Capricor Therapeutics, Inc. (CAPR) Earnings Call Transcript & Summary

Good day. And welcome to the Key Opinion Leader Call on cardiac complications of DMD hosted by Capricor Therapeutics. I will now turn the call over to A.J. Bergmann, CFO of Capricor Therapeutics. Please go ahead, Mr. Bergmann.

Before we start, I would like to state that we'll be making certain forward-looking statements during today's presentation. These statements may include statements regarding, among other things, the efficacy, safety and intended utilization of our product candidates; our future research and development plans included in our anticipated conduct and timing of preclinical studies; our plans to present or report additional data; our plans regarding regulatory filings, potential regulatory development involving new product candidates and uses of existing cash and investment resources. These forward-looking statements are based on current information, assumptions and expectations that are subject to change. They involve a number of risks and uncertainties that may cause actual results to differ materially from those forward-looking statements. These and other risks are described in our periodic filings made with the SEC, including our quarterly and annual reports. You are cautioned not to place undue reliance on these forward-looking statements, and we disclaim any obligation to update such statements. With that, I'll turn the call over to Linda Marbán, CEO.

Yes. Good day and thank you for joining us for this very important webinar on the impact of the cardiomyopathy in Duchenne muscular dystrophy. Let me remind you that while we are all preoccupied with the COVID-19 pandemic and the fear that comes as a result, for those boys and young men and their families with DMD, risk and fear is a regular part of their lives. Let me remind you that as DMD progresses, they see their lives changed and become more restricted with the continued loss of function from this devastating disease. It is with these thoughts in mind that Capricor maintains its focus on DMD and developing CAP-1002 as a potential therapy for this disease, with our goal of bringing this therapeutic to these patients as quickly as is possible. As you know, we have the 12-month data coming very soon for HOPE-2. We expect to have it available by mid-May now that all patient visits have been completed. Importantly, study patients who received CAP-1002 will have received up to 4 doses of 150 million cells intravenously over the course of 1 year. One of our goals with CAP-1002 is to treat the cardiomyopathy associated with DMD. While we also have seen improvements in skeletal and respiratory function, to our knowledge, we are one of the only therapeutic that has shown a direct and relevant impact on cardiac function in DMD. And as you may know, the heart disease is often the cause of death in these boys and young men. Should gene therapies or other dystrophin replacement therapies work, there will be an even greater load on the heart as the patients will likely be more active. So therapies to treat the heart may even be more important than previously thought. We, at Capricor, have been laser-focused on this treatment paradigm. To remind you, the therapeutic we are using, known as CAP-1002, is a unique cell known as a cardiosphere-derived cell which originates from the heart. The cells function by releasing exosomes, otherwise known as nano-sized vesicles, that are taken up largely by macrophage and T cell and begin a cycle of repair. At this point, we have treated several hundred patients to date across a variety of clinical trials. Now we also recently announced the emergency and compassionate use program for CAP-1002 for the treatment of patients with COVID-19. I will provide you an update on that program at the end of this call. But for now, I would like to turn your attention to Dr. Michael Taylor, who will be speaking to you about Duchenne muscular dystrophy and the heart. It is my pleasure to introduce you to Dr. Taylor. Michael Taylor, MD, PhD, is a pediatric cardiologist at Cincinnati Children's Hospital Medical Center where he directs the Cardiac Magnetic Research -- MRI program. In collaboration with the Cincinnati Children's multidisciplinary neuromuscular center, his group has performed over 1,000 cardiac magnetic resonance studies in DMD patients for both clinical care and research investigation. He has published papers on cardiac function, myocardial injury and response to therapy in Duchenne muscular dystrophy cardiomyopathy. Dr. Taylor joined the Heart Institute in 2010 as the Director of Advanced Imaging Innovation and cardiac MR. He has expertise in cardiac magnetic resonance imaging of acquired and congenital heart disease in children and adults. He has a dual appointment in the Cincinnati Children's Hospital Medical Center Imaging Research Center, an interdisciplinary center dedicated to research MRI. Dr. Taylor's primary interest include cardiac MR and myocardial characterization, animal models of cardiac pathology and novel MR techniques. He has an MD and a PhD from the University of Wisconsin, the PhD in physics and postdoctoral training in pediatrics and cardiology at Baylor College of Medicine. It is my true pleasure to introduce you to Michael. Michael, take it over.

Good afternoon. I would like to thank Linda and Capricor for the opportunity to talk to you about Duchenne muscular dystrophy and its effect on the heart. I'll go over some background about Duchenne muscular dystrophy. And then I'll talk about the cardiomyopathy of DMD, particularly what we know about the pathophysiology, the natural history and our use -- our clinical paradigm as a framework for discussing evaluation and treatment. Finally, I'll talk about the current therapies that we have, one in HOPE-2 trials, and finish with a few words about how to think about DMD cardiomyopathy therapies going forward. So as most of you know, Duchenne muscular dystrophy is a devastating, progressive x-linked muscle wasting disease that affects, we estimate, around 200,000 boys and young men worldwide. It's the result of a mutation in the dystrophin gene. And as a result of this mutation, muscle cells are replaced by a combination of fatty and fibrotic cells in skeletal, diaphragmatic and cardiac muscle. The most striking aspect of the phenotype is loss of ambulation usually by age 12 to 15, you can see the young man here in the wheelchair. Premature death from respiratory or cardiac failure is seen starting in the late teens with average life expectancy now with current therapy somewhere around 27 years of age. There is no current curative therapy, but glucocorticoids or steroids do prolong ambulation and seem to provide some benefit to the heart. And I'll talk about this data as we go along. The causes of the death and their frequency are seen here. The data is a few years old. And as of now, we actually think cardiac failure is responsible for closer to 50% of the known causes. Additionally, it's likely a primary or an important contributor to patients who die of respiratory infections or respiratory insufficiency. So as you can see, finding a therapy for -- that can be used in all Duchenne patients regardless of mutation that either stops or at least slows the progression of the cardiomyopathy would be a tremendous clinical benefit. So Duchenne muscular dystrophy is actually categorized as a neuromuscular disease. And there's a whole range of neuromuscular diseases, as you can see at the table on the right. And some of them are associated with cardiomyopathy. In particular, Becker muscular dystrophy is actually also due to a mutation in dystrophin. The skeletal muscle phenotype is clinically milder in presentation. And most -- obviously, externally, they don't lose ambulation until much later. However, the cardiomyopathy in Becker's tends to start a little earlier and is more aggressive. And the bottom line for the discussion and why I bring it up is that the evaluation and treatment is the same for us for both of these. The only exception would be therapies that are specific for a particular mutation. So essentially, we treat them both as dystrophinopathic cardiomyopathy. So the Duchenne muscular dystrophy itself, the incidence is somewhere around 1 in 3,500 males, up to 1 in 5,000. And as I mentioned before, it's a result of dystrophy mutation. The top diagram on the right is a schematic of a muscle cell. You can see the muscle cells are made up of fibers, and each fiber has a membrane that's responsible for the structural integrity as well as transport into the cell. Dystrophin, shown here in yellow, is a long tubular protein that connects the cell membrane to the contractile apparatus of the cell, specifically actin. So in the diagram below, which is a slightly more detailed picture, dystrophin is shown actually in green here. And it highlights the complex nature of the protein itself and its interactions with multiple proteins that are either on or near the cell membrane, which is important because as we go forward, you'll see that much of the pathology that is -- results in Duchenne cardiomyopathy as a result of membrane disruption. As the dystrophin, the -- goes away and the patients age, dystrophin muscle, the cells progressively die and are replaced. And by somewhere around 18 years of age, about 70% have detectable heart dysfunction. They all have heart dysfunction of some sorts, whether we can detect it by our imaging or not. From a historical perspective, we've known about the pathology for quite some time. This is actually an interesting paper from 1966 from Los Angeles long before we knew anything about dystrophin, showing the gross fibrotic changes of the heart on the left and the histology on the right that shows, just like we see now, multiple areas of what we call fibrosed adipose tissue or fibro-fatty replacement of the myocardium. This diagram, I think, is a nice illustration of how we go from a single gene mutation to myocardial dysfunction and clinical heart failure. So if you start at the top within a normal -- abnormal dystrophin, it results in 2 primary pathologic processes, both of which have to do with the cell membrane. First, we have the dysfunction of the membrane. Here, we call it the sarcolemmal membrane or cell membrane that causes dysfunction of ion channels as well as destabilization of what is termed the dystrophin-associated protein complex. So it's that group of proteins that are associated with dystrophin that increases membrane permeability. Both of those results in abnormal calcium regulation. And it's this abnormal calcium regulation that eventually results in cardiomyocyte death and apoptosis. And as the cardiomyocytes die, it induces a marked inflammatory response with fibrosis formation and replacement of the myocardial cells, thinning of the regions of the heart that were -- with the fibrotic tissue. As the heart cell dilates, the first thing you start to see is problem with the heart relaxing. And then as the muscle cells die away further and you have more and more fibrofatty replacement, you get areas of the heart that are dysfunctional. Then the whole global -- the global function of the heart starts to decrease. And then the heart starts to dilate. And as the heart dilates, then the valves stop to work -- working, and it becomes a vicious cycle. Why I like this diagram is it actually points out that there are multiple things along here besides just replacing dystrophin that you can address with therapies, including the inflammatory response, the abnormal membrane permeability, the calcium regulation. You'll see as we go forward, many of the therapies that we have don't directly affect the -- don't try and replace dystrophin but, in fact, attack some of these other areas of dysfunction. So let me talk a little bit about how this shows up clinically. So this is a diagram with 3 phases. So this is from 0 to 10, showing what we would call the preclinical stage of the disease. And before age 10, we see almost no overt cardiac dysfunction. We can see very subtle ECG abnormalities. Almost all of the patients develop sinus tachycardia, which is essentially an accelerated heart rate but with a normal rhythm. There's some subtle abnormalities in relaxation, but none of which are really clinically important. Between ages 10 and 18 is where we see the most dramatic changes. Patients lose ambulation at this time. [Audio Gap] actually says subendocardial fibrosis. It's actually sub -- it's epicardial fibrosis that progresses to the subendocardium. The first change in the contractility that we see is actually regional changes in thinning the wall of the lateral and inferior or the bottom of the heart changes first. And then as that progresses, then you can go to global changes in the function and then finally to dilation. Actually, chamber dilation in this disease is a very late finding, and we don't typically see it until the next phase. So between ages -- starting somewhere in 18 to 20 and older, nearly all of the patients will have some amount of detectable systolic or pump function -- dysfunction. They will all have some amount of fibrosis that we can detect by cardiac MRI. About 60% of the patients or so will have symptoms. Eliciting symptoms from this patient population is very difficult because they are non-ambulatory and don't exert much -- or don't have much energy expenditure. So the classic NYHA heart failure classifications are very difficult to use here. We actually have particular ones for Duchenne but again can be very difficult and then finally, when you get to end-stage heart failures where we start to see the actual arrhythmias cause a problem. But we're getting better. So this is just looking at survival by era. So on the right is the 60s. And as you work up your way -- you work your way to the left, the current era where we have active ventilation and spine surgery, and the survival is much better. This is a survival curve showing the same data. But you can see that the dark line is the previous eras, as you work your way up into the current era, where if you look at this, you can see that somewhere, as I said before, about 50% of the patients are alive and well at 27 years of age. And we have lots of patients that are in their 30s and even some in their 40s as well. And people are clearly living considerably longer with better respiratory care and cardiac care. So let me move on to the way we evaluate and treat these patients. This is a very detailed diagram, and the point of it is not to look at all of the details. But what I want to get across is the very first thing that we do in terms of evaluation is an ECG and some sort of imaging test. And based on the imaging test, we bifurcate the therapies. So I'd like to talk a little bit about the evaluation first, and then we'll talk about the therapy. So the first thing we do is ECG. And it turns out in looking at nearly 440 ambulatory monitors, we found the percentage of significant arrhythmias is pretty small. So the total percentage was only about 3% if you take all comers. Patients with normal function had very few arrhythmias. When you get severe dysfunction, the arrhythmias get a little more prevalent, but the bottom line being that treating for primary arrhythmias in this patient -- these patients is pretty rare. It's a little bit of change in paradigm because if you read some of the older literature, it talks about really significant arrhythmia burdens. But that seems to be much better now. So moving on from ECG. We have to do some sort of imaging. Again, I said the symptoms are not easily discernible in these patients. And so the original sort of the way we start with imaging is using echocardiography. The problem with echocardiography in these patients is that the pictures are often quite suboptimal. So this is a typical echocardiogram from a patient who is wheelchair-bound with Duchenne muscular dystrophy. And you can maybe make out a heart in there and if -- you can imagine, it doesn't get any better. So we've actually gone in a lot of places how -- now have gone to doing cardiac MR. We find it replaces echo. And after about age 6 to 8, we use yearly exams without sedation. The typical exams last about 30 minutes or so. We have an abbreviated noncontrast follow-up exam version that's about 10 minutes, and we have -- we've done somewhere in the order of 2,200 exams now since 2004. And let me show you why we like it so much. So this is actually -- on the left is the cardiac function stack. So this is a stack through the heart, so short access through the heart with the left ventricle here and the right ventricle here. You can see this is an advanced case of cardiomyopathy showing the thinning of the wall, the free wall, the lateral free wall. If you could see it playing, you see that the function is actually quite poor. And it's particularly pronounced up towards the top of the heart. If you look over to the image at the right, this is actually a post-contrast evaluation looking at scar or what we call fibrofatty replacement. Everywhere that you see white in the myocardium, tried to highlight with the yellow arrows, is evidence of this fibrofatty replacement. So normal myocardium should be dark black in the scan. And you can see this is extensive replacement, particularly in the free wall of this patient, again, in a very advanced case. So between these 2 studies, it gives us some idea of what's going on actually in the myocardium histologically as well as a very accurate assessment of the function. So taking some of this data and looking at it going forward, what do we see in terms of function as patient’s age? So on the left here, you can see shortening fraction, which is just a measure of function by -- we can do by echo or MR. And on the x-axis is age. And so you can see the black circles, they're patients that are on steroids, and the open triangles are patients that are not on steroids. Everybody's function declines as you age, but you can see that the steroids seem to have a protective effect. And just for reference, on the right is the respiratory function. And so you can see that there's an inexorably progressive decline in the respiratory function even as the cardiac function for some patients is maintained. Similar data using a slightly more sophisticated cardiac MR. So again, we have age on the x-axis and ejection fraction now on the y-axis. And I must mark what was normal and what was abnormal for a function. You could see very little dysfunction below age 10. So you really don't start to see dysfunction until you get into early teenage years. The blue diamonds are patients who had no scar on their MRI or no fibrosis noted on their MRI. The red squares are actually patients who had fibrosis. So you can see that it's very rare to have dysfunction and not have signs of that fibrosis. And what -- so a few interesting findings. One, you can see how bad the function gets in some patients, even when they're teenagers with ejection fractions down in the 20s, which is severely depressed. But interestingly, we have patients that are in their late 20s or even early 30s who have evidence of fibrosis but have maintained their ejection fraction, which is a phenomenon that was thought to not actually -- thought to be extremely rare, but now we see it more and more with better care. This is a similar study, but what we -- this study looked at, if you take the same patient and you image them for 5, 6 or 7 years, what do you find? And everything in green on the left is ejection fraction changes before you get positive fibrosis on your MRI, and then everything to the right is after you have positive fibrosis. And what we found is that on average, the ejection fraction doesn't change until you see fibrosis. But then once you see the first scan with fibrosis, the ejection fraction declines around 1.5 percentage points per year. So a progressive decline, but not until after you can see it, which is -- so the reason that we are so interested in doing those studies is to be able to get an idea of when we anticipate patient's function is going to decline. So let me go back to our algorithm just to point out some of the things that we do for therapy. So you can see that the first decision point for therapy is the ejection fraction. So it's the other reason we really like cardiac MR. It's the most accurate way to assess the ejection fraction. And if you're going to make a decision based -- for a therapy based on this, we find this to be the most -- to be important, if possible. But you can see that if you go to the left, even for patients who have a normal ejection fraction, which we're going to call 55, everybody at age 10 or older gets put on a ACE inhibitor. And I'll show you data for this in a minute. And then if they have LGE, which is the MR term for having that fibrosis, then we put them on spironolactone, and I'll show you the data for that in a minute as well. If you go to the right now, where you can see that the ejection fraction is less than 55 where there is dysfunction, we actually start in ACE inhibitor as well and then add a beta blocker just based on the some -- the heart failure literature, and then again, add spironolactone if we see fibrosis on the MRI. So these -- this is sort of a schematic of what we have evidence for in terms of cardiomyopathy. All the patients that we see in clinic will have been started on steroids shortly after the time of diagnosis to -- because based on some really good data, this is just one example, it actually prolongs your ambulation. So based on steroids, it prolongs how long you can walk. And it turns out that, as I showed earlier, it also prolongs your survival, so -- and your cardiac function somewhat. So this is survival data from Montreal proving that patients on steroids live longer than patients [indiscernible] but some of this is due to cardiac effects. Some of this is obviously due to other effects, primarily pulmonary effects. So then what's the evidence for ACE inhibitors? So it's pretty good. This is just one example. So this is a study [Audio Gap] it's in the pink circles, and the red circle are patients that are on ACE inhibitors. And the black circles are patients that were [ seen ] after 60 months, so almost 5 years. That very few of the red circles had abnormal function. The line here is 45%, which would push the mildly to moderately depressed function. So normal function, we see at 55%. So even if you use 55%, very few of those patients decline as opposed to the patients in the black circles where quite a few of them declined. So based on this data, we actually use ACE inhibitors quite often in these patients or anybody that can tolerate an ACE inhibitor will be on an ACE inhibitor. More recent data for the mineralcorticoid receptor. So this study was using eplerenone [indiscernible]. It's essentially the same mechanism, but this is an example that showed that the ejection fractions on eplerenone stays about the same, and patients on placebo in this trial, actually, the ejection fraction went down. More detail from that base study is shown here. The study of between 3. You can see that the ejection fraction for the eplerenone, again, states the change was 0 as opposed to a small change here. But what -- the other thing that was impressive was the LGE actually -- it's a small change. But in the eplerenone group, it actually didn't change much, and the placebo had progressed a little bit. So a little bit more scar and the function is slightly better but very small effects on both sides. So let me now move on to the Capricor CAP-1002 technology. As Linda mentioned earlier, it's a biologic agent of allogeneic cardiosphere-derived cells. It doesn't act as a stem cell in the sense that it's not actually replacing myocardium but has multiple -- it's thought to have multiple mechanisms of paracrine effect or essentially effect -- including inflammatory, thought to act, at least in part, to 3 microRNAs. And again, it's been studied quite extensively. The first HOPE study enrolled older patients who had severe -- or moderately to severely depressed function and included a onetime intracoronary delivery of the cells. All these patients were on stable corticosteroids. And at this point, there's limited options for these patients because the function -- the cardiac function is pretty well -- has pretty well declined. And so much of the therapies, ACE inhibitors and things that we do, don't make a big difference here. What we saw was a reduction in scar at 6 and 12 months, measured by cardiac MR or fibrosis, and an improvement in cardiac function, measured by systolic wall thickening at 6 and 12 months. And interestingly, even though this was an intracoronary delivery of these cells, we showed improvements -- or the improvements were shown in upper limb strength. Here, that's what the PUL here is, upper limb strength, mostly in the first 3 months. And this study was published back in 2019 in Neurology. This is just 4 diagrams from that paper. The upper left shows the example of patients -- again, the white signal is scar, showing that the scar improved from baseline to 12 months. You can see that the scar size is documented below in that bar graph. If you go to the bottom right, that's the wall thickening. And again, patients who got the drug are shown in red, and so slightly better wall thickening. And the same is true, you can see that the month 3 PUL scores are considerably higher than the placebo -- or the patients with usual care. So moving forward, HOPE-2. Again, the Phase II study of DMD patients but this time delivering the cells intravenously over 3 months, 9 sites now with a mean age, again, of 14. So about 80% of them are non-ambulant, and all of them are on corticosteroids, looking at the effects of both upper limb strength but more importantly to me, obviously, looking at their effects on the cardiac function. The interim results at 6 months show an improvement in ejection fraction, which we consider to be the gold standard in improving pump function. It's a robust measure and it -- even though it's an old measure, it actually is probably with the -- it's easier to measure than other things when you're talking about pump function in these patients. So I wanted to spend just a minute or so talking about advanced heart failure therapies. So in most patients now with pediatric cardiomyopathy who have severe dysfunction, we would move aggressively to a left ventricular assist device or to transplant. This is a recent study looking at 43 Duchenne patients with severe dysfunction, and only 4 of them ended up on a ventricular assist device and only 1 with a heart transplant. There's a myriad of issues of why this is true. A lot of it has to do with by the time you develop enough dysfunction, that you can actually -- that you meet criteria for an LVAD, that, in fact, you have too much pulmonary disease, the patients are on a trach or they're requiring a ventilator and that they are no longer candidates for VAD. And there's ethical issues with heart transplantations that always come up in terms of transplanting patients that we know have this much systemic disease. The bottom line is that both of these therapies are probably underutilized. We'd certainly like to fix this before it got this far. It is an unfortunate character of these events. So finally, I just want to touch on how we think about therapies in this realm. So this -- on the right is a diagram that I borrowed from Craig McDonald from a talk that he gave. But the way to think about DMD therapies is not just replacing dystrophin, which is up at the top. It's actually all these other approaches can have some therapeutic benefits, such as steroids, we know it decreased inflammation. And again, we think that the CAP-1002 does some decreasing inflammation, probably helps mitochondrial dysfunction and may actually help in calcium handling as well. So different modes of getting -- at how we treat this disease. So again, in summary, Duchenne-associated cardiomyopathy is an inexorably progressive disease with variable onset. The current therapies provide marginal therapeutic benefit. These patients need a transformative therapy that prevents -- either prevents the replacement of cardiac muscle cells with fibrous and fatty cells or somehow provides new muscle cells. And with that, I'll close and I'll be happy to answer any questions.

Thank you so much, Dr. Taylor. We've been working together for years now. And each time I hear you speak, I learn something new. So I hope that our audience did as well. Now for a quick update on our COVID-19 program, as promised, and then we will take questions on either that or on the cardiomyopathy issues from Dr. Taylor. As of today, several patients who are in the ICU and on life support have been treated with CAP-1002. All the patients we have treated have shown improvements with no safety issues with infusion. We are currently working with our colleagues at Cedars-Sinai Medical Center in preparing a manuscript for submission to a peer-reviewed journal, which will provide further clarity on the potential impact of CAP-1002 on patients that were critically ill with COVID-19. However, what I can say today is while that it is very early in the process and that we are only looking at a handful of patients, we are very excited by the results that we have seen so far and have submitted an expanded access protocol IND, or investigational new drug application, to the FDA to continue the evaluation of CAP-1002 in patients with COVID-19. We are also attacking COVID-19 from another front. We are also continuing our work on a unique exosome-based vaccine with Dr. Stephen Gould, who is a professor of biological chemistry at Johns Hopkins University and who is working directly with Capricor on these efforts. And let me just tell you that this program is moving even faster than I anticipated. If you haven't had a chance to listen to the replay of the webinar that Dr. Gould did for Capricor on March 26 on why exosomes may be a unique and more effective vaccine candidate, please do. It is very enlightening. It is on our website at capricor.com. I look forward to providing updates on that program as details emerge. However, I want to end this call where we began, focusing on DMD. We will have the 12-month data very soon, as I said. We will provide updates as to our plans and the results of the trial very soon. Please stay tuned for those updates. Okay. Thank you. Let's just open up the line for questions.

[Operator Instructions] Our first question is from Joe Pantginis from H.C. Wainwright.

Thank you for all the details, Dr. Taylor. Two questions first with regard to HOPE-1. Just wanted to get maybe a little more detail with regard to your impressions of the impact on the scar size and inferior wall improvements that were seen, and the level of clinical relevance, not necessarily just the statistics around them, but the actual clinical relevance, sorry. And when you translate that to the 12-month data, obviously, you have different delivery, but also why you think the multi-dose should show further improvements?

Yes. Thanks. So the clinical relevance of the scar size, I think, is a little tough because the question is, are you -- we are pretty sure we're not replacing the scar with new muscle cells at this point, that we're somehow improving the function of what's there. So I think that's probably -- again, I would leave it as I'm not sure about the clinical relevance of the scar size. The thickening, I think, has some -- it's certainly -- I think it's a clinically relevant change whether you could see it externally. I mean it didn't change the ejection fraction. So clearly, it didn't change the cardiac output. But it certainly was something that visibly you could see. And so you could actually see that, that part of the heart actually worked better. What that means going forward, 5 years from now, 10 years from now, should we continue the infusions? I'm not sure I know. In terms of the 12-month data for HOPE-1, again, it was -- that's a little bit far removed from when we gave the cells. So I think some of the thought is some of the effect wasn't -- it wasn't as prominent 12 months. And it's one of the reasons in the HOPE-2 for redosing. Obviously, the biggest change is not having to actually cath somebody to give the cells, which is a huge benefit. You can only imagine how much work it was to cath all these children to get them the cells that we were testing. It was one of the more impressive trials I've ever been involved with. I don't know if you want to add anything, Linda.

No, thank you. That was really helpful. Joe, do you have any more questions?

Yes, I do, actually. Wanted to go a little broader to talking about the regulatory landscape. So maybe if you could pontificate a little bit. Obviously, the knowledge base that you just described today is very, very broad with regard to the impacts of cardiomyopathy in these patients. So maybe first, what are the -- obviously, there's an unmet medical need still. So even though you see effects with ACE inhibitors and beta blockers, et cetera, it's fair to say, I'm assuming that there's still an unmet medical need. And based on the knowledge that the cardiac impacts are so prominent in this disease, why do you think the regulatory landscape has lagged thus far? Is it just because there just hasn't been a lack of adequate new type of therapy or anything else you'd like to share?

I don't know of anything else besides the fact that we haven't found anything yet that's profound -- that provides a profound effect. I mean nothing for the heart has provided as much benefit as the steroids have for the skeletal muscle, as you're probably aware. I think the one thing for the heart that seems to be the best is providing better pulmonary care right now. So I mean I don't know of any other issue on the regulatory front. I mean we seem to be able to get trials going with these patient populations pretty quickly. It's a -- as you probably are aware, it's a very involved patient population. So patients are really enthusiastic about joining trials. And so that certainly has never been an issue.

Michael, can you add to that for a moment? This is Linda Marbán. I wanted to know if you could describe the FDA's approach to cardiac end points as an approvable end point in Duchenne. Because one of the things that we've heard is that it's very hard to get an approval for cardiac based on some of the adult cardiology work and clinical trial design. Could you just provide a little update on some of that thinking?

Yes. Well, some of it's a little opaque to me, I'll start saying. But I think some of the secondary end points that we would like to see like strain and -- particularly strain, I think, have been met with some, I think, some criticism by the FDA in terms of whether if you show changes in strain, is that adequate for an end point. The other -- I think the biggest problem for end points for us has been that just showing the fact that something doesn't change, so if you just show that the ejection fraction stays the same over 2 years, it likely probably shows a benefit. But in fact, it's difficult to -- it's been difficult to convince the FDA by just showing stability of ejection fraction that, that is adequate. We know that, again, this is -- as we tried to show with that MR -- that longitudinal MR data, once you have scar, the ejection fraction always gets worse. And so I think that's been the other issue in terms of what is an adequate end point for a cardiac trial. I mean the thickening is not -- although I find it compelling, has not been met with wide, I don't know, wide respect, I guess, from the FDA.

Thank you. What do you think about ejection fraction as a potential end point or volumes? Do you think that some of those global measures could be important in Duchenne as far as results...

Yes. I mean even though ejection fraction is old and we've been measuring it for a long time, when you measure it with MR, the error bars in that measurement are really small. And it's a stable measurement, and we -- in terms of stable for measuring it. Even in noncooperative patients who can't hold their breath, we get really pretty images, much more so than we do on echo. And the test, retest for something like ejection fraction and a 10-year-old Duchenne is probably less than 5% the variance. So it's probably the best measure, but it's also probably one of the later measures. So if you're going to show just -- if you want to show changes in a regional -- so let's say, you just want to show that the lateral wall contracts better, it's not going to change the ejection fraction, which is why I think things like -- if we could convince people that strain -- regional strain was actually a viable outcome measure, I think it would be helpful. But again, when you start talking about regional measures, the error bars go up a little bit.

Thank you. That was very helpful.

That would explain -- okay, yes.

Any more questions?

[Operator Instructions] Our next question is from Chen Lin from Lin Asset Management.

I got in a little bit late in the conference call. And quite a few you were discussing on the end point. So you had various discussion with the FDA. Is there any -- what's the agreement you have for your trial end point that will be acceptable for them for -- to determine the outcome?

I'm sorry, end points, did you say?

Right, right. Those...

Yes.

Yes. You talk about the scar, those reduced cardiac scars. Those are -- you discussed also with FDA, what's their input on those?

Michael, go ahead.

So for cardiac function, I think reduction in scar is an adequate end point for the FDA, but that's not the primary end point for the trial. It's a secondary end point, I think, for the HOPE-2 trial -- it's actually not -- we're not giving gadolinium to those patients, I apologize. So it's going to be regional function for the HOPE-2 trial. But the...

So thank you for the question. Yes, I didn't realize that you -- I thought he was asking globally about regulatory landscape. But for -- specifically for the HOPE-2 clinical trial, Mr. Lin, the answer is that we have multiple cardiac end points built in to this exploratory measure of modification of the cardiomyopathy. The trial was originally powered against the mid-level performance of the upper limb. However, we're focusing hard now on working with all the end points, skeletal, cardiac and potentially respiratory to build an approval package for CAP-1002. So stay tuned for the results of the trial and also our plan to move it forward with the FDA.

Okay. Great. Yes. Again, I missed the early part of the conference call. Did you finish all the trial, you're collecting the data coming back, you're analyzing the data right now? Or where are you at the HOPE, the trial?

Yes. We expect to have data in this quarter, the second quarter of 2020 for the full 12-month data analysis. And so we'll be providing updates on that data when it's available, and our plan's moving forward for the clinical development of CAP-1002.

Okay. Great. So there's no impact from the COVID-19 cases, right? So...

No, we were very lucky that our last few patients got in right before the pandemic really took hold and had significant implications for clinical trials for other people and companies. So we are grateful that we were able to finish. We were 1 MRI short, but we were able to finish the study.

Great. Congratulations. Looking forward to the results.

We are as well. Thank you so much.

And our next question is from Tim Revell from Duchenne.

This is Tim Revell with CureDuchenne. I actually have 3 questions. First of all, I think you've kind of answered it. So are there not going to be any further trials beyond the collection and results of the 12-month 1002? Is the next step truly just going to FDA for approval based on the results?

Yes. Thank you for that question. So we're going to put this into a multipronged approach. We are going to look at the data first. If the data is as good as the interim data was or better, we will then likely develop a very strong regulatory approach, where we will go and ask for approval for this therapeutic for many reasons, not the least of which being that conducting clinical trials perhaps for the next 6 months and/or longer could be quite difficult due to the COVID-19 crisis. And we want to get this therapeutic if it works as well as we think it's going to, to the patients as soon and as easily as possible. Having said that, there's a long way between us and approval. So we're not saying that it's the last trial with CAP-1002. There may be another trial that would be required by the FDA, a Phase III trial. We're hoping that's not the case, but we reserve that as one of the possibilities or the other possibility if we're successful in gaining some version of approval, whether accelerated or full, we fully expect that there will be a confirmatory trial on the back side of that, which will be likely longer in nature and following both the skeletal and cardiac over the course of time. So for now, we're excited to see the data, and we plan on providing updates to the Street as they become available.

Okay. Next question, I think that I had heard an opinion that potentially you guys might be looking to try to get the exosomes filtered through the cell process, meaning you would be, in the future, injecting more exosomes versus the cell therapy. Is that an accurate statement? Or is that something that you would potentially look at doing for future -- the future of the treatment?

Yes. So over the last 5 years, we've been able to elucidate that we believe the mechanism of action of the cells is the release of exosomes. So once the cells are infused into the patient, they're trapped in the small blood vessels. They don't cause a safety issue because there's lots of small blood vessels, and they're primarily in the lung. And then from there, a stress cell releases a lot of exosomes. So we think a lot of exosomes are released, taken up by activator cells like macrophages, and that's why they're so immunomodulatory. We've been able to isolate out, without a lot of study, the exosomes made by the cells and then look inside them for the active components. And so what we're doing now is a multipronged approach with the exosomes. We are, first of all, looking at those wild-type exosomes as the potential therapeutic, either potentially in COVID-19 or other indications such as Duchenne. But we're also looking to capitalize on the biologic ability of the exosomes to be the messenger of a cellular communication and using an engineered exosome, either, for instance, as a vaccine, that's what we're working on with Dr. Gould right now for COVID but also in the future for diseases like Duchenne, where we can custom load the exosomes with a bioactive molecule and deliver some type of impact to a cell that would change function down the stream.

Okay. Last question. The dosing regimen. So just my history, my oldest son participated in [ HOPE-101 ], the first one. And we went through control and then received 2 dosings. I can confirm the PUL increase after both dosings, but then we slightly went back to normal state. So in the future, what would be the initial suggested regimen that we would -- or you would present to FDA for potential patients?

Yes. So we're very excited with the data that we've seen in the performance of the upper limb. And what we've decided to do based on previous work with HOPE-1, where we were able to track 1 dose over a year and see the biggest increase at 3 months, and then we went to a 3-month dosing regimen in HOPE-2. And we believe that, that would be what we would propose as a quarterly dose moving forward as long as possible. We do seem to see a bump in function that does seem to recede over time if they're not redosed.

So with the initial -- or I guess all of the quarterly treatments, would those be -- would they be deemed to process in a local clinic where the patient would live? Or would you have strategic locations that people have to travel to?

Yes. Our goal is to provide it locally on a clinic near where a patient lives. Currently, our plan would be an infusion center just to make sure that the patients are maintained and safe. And if there's anything that happens, that they can get the best medical care there is, but as close to people's homes as possible. That's one of the reasons why we're going to go for accelerated approval because we don't want people to have to travel in this current climate.

Correct. My last question, and this is completely open. You won't necessarily have a straight answer, but I will ask it because I haven't got an answer. After my son received both dosings of the 150 million cells, he had 6 hours later pretty substantial allergic reaction, which included pretty severe vomiting after both treatments. So any idea why he had kind of that reaction and vomiting? Nobody really gave me an answer for that.

I'm really sorry to hear that he wasn't feeling well afterwards, that's unfortunate. We don't really know what causes responses in patients. What I can tell you is that there have been no long-term sequelae. Sometimes people's bodies respond badly when something is infused into it that contains proteins, which our cells contain proteins. And if he was in the 150 million cell group, then we don't know if he got cells or if he was a placebo patient. We will understand that pretty soon. So let's hope it's something that was just temporary and will be resolved over time. And hopefully, he felt better soon after.

And there are no more questions in queue over the phone line.

Okay. I'll have one more question that's come in through the web chat. And Dr. Taylor, I know we've kept you a long time. But just very briefly, if you could give a little bit of an explanation as to whether it's thought that the gene therapies that are being used currently or in clinical trials may have an impact on the heart of Duchenne patients?

I assume we're talking about microdystrophin gene therapy? Is it or...

Yes. I think -- I believe that's it, yes.

Okay. So just in general, I would say the short answer is we don't know yet. I mean I think hypothetically, it sounds -- I think it sounds good to replace the dystrophin, and it would be ideal if we could start replacing it shortly after birth or as soon as we make the diagnosis. But at this point, I don't think we know whether it's going to -- whether it's a viable solution long term for these patients or not. I mean certainly, we have seen some good data from both mice and from the golden retriever dogs. But whether it's going to be viable in humans, I just don't know.

Well, I'll stay hopeful for those impacted patients.

Yes. For sure.

Surely, we want the best for them.

We hope so. Yes.

All right. Are there any more questions? I see no more coming in from the web quest.

Great. There are no more questions coming in from the phone line.

Well, thank you. Thank you for joining us on our call today. Please stay well. And let's hope that we and others can make a difference in this pandemic, so that we all can go back to our lives as we knew them just a short time in the past. Please look for the HOPE-2 data coming soon. We look forward to providing those updates and our plans to move that therapeutic forward. And thank you for your time today. Thank you, Dr. Taylor. It was wonderful.

Thank you.

All right.

And this concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.