CRISPR Therapeutics AG (CRSP) Earnings Call Transcript & Summary

Hello, everyone. My name is Gena Wang, and I'm SMID cap biotech analyst at Barclays. Welcome to our Second Virtual Global Healthcare Conference. First, I wish everyone stay healthy, and I would like to thank all the participants, investors, companies and especially our event team and corporate access team to make this virtual healthcare conference possible. With that, I would like to introduce our next presenter, Sam Kulkarni, Chief Executive Officer from CRISPR Therapeutics. Sam, hand over to you.

Yes. Thank you very much, Gena. It's a pleasure to be here at your conference in this virtual format. It was, I recall, 5 years ago, one of the first public corporate presentations we did as a company was actually at your conference in 2016 in Miami. And in that time frame, we've made quite a bit of strides in going from a small pre-IPO company to where we are today, which is to be as the leading gene editing company, translating the power of the CRISPR/Cas9 technology platform into transformative medicines. For those who are new to the story, CRISPR/Cas9 is a powerful technology that was elucidated by Dr. Emmanuelle Charpentier and Dr. Jennifer Doudna almost a decade ago now. And we...

Sam, I just wanted to -- if you have a slide to share, I think you will need to share at this call so the investor...

Yes, I will. I will share slides.

Okay. Sounds good.

It's a powerful technology platform, which won the Nobel prize last year for the development of CRISPR/Cas9 as a gene editing technology, which shows the power of the technology platform, and it has quickly become sort of the dominant gene manipulation and gene editing technology that's being used out there in research settings, but also in drug discovery. So as a company, before I go any further, I'll just make -- I'll make the statement that we're going to be making forward-looking statements today, and I encourage you all to go to our website for a complete list of risk factors associated with our programs and our company. But overall, I think where we stand today, 6 years out as a company's journey, we've grown dramatically and rapidly. We have over 450 employees today, most of whom are based in our operational headquarters in the Cambridge area in Boston. And we have a number of programs that we're advancing. Most notably, we're advancing CTX001 in beta thalassemia and sickle cell disease, where we had quite a promising data, early data, and we'll discuss more about that data here shortly. We also have a wholly owned next-generation platform in immuno-oncology, where we make allogeneic CAR-Ts. And this platform is very powerful, where we have 3 different CAR-Ts in development. CTX110, 120 and 130 across a number of indications, and I'll describe those programs more. And beyond that, we've enabled a regenerative medicine platform which utilizes CRISPR/Cas9 to make genetic edits to iPS-derived or embryonic stem cell-derived cells to create a whole host of applications which utilize allogeneic cells to regenerate organs, whether it's the pancreas or the liver or other organ systems. And finally, we're advancing the use of CRISPR/Cas9 in vivo, which means that we're taking the CRISPR/Cas9 editing tools and applying that directly inside the patient's body to create the edit of interest in the right organ system. And this is through a mix of in-license technologies, platforms and strategic partnerships, which I will describe as well. Here is a look at our portfolio. I think we have our lead program, beta thalassemia and sickle cell, where we're enrolling patients. I'll talk more about this program, but we're partnered with Vertex Pharmaceuticals on this program, 50-50. And we're jointly advancing this program in what could be the best-in-class medicine for these patients suffering from severe thalassemia and sickle cell. With our immuno-oncology programs, all 3 of our CAR-Ts are enrolling across more than 3 indications. And I think those programs are progressing nicely. They're all wholly owned. We had initial data disclosure for CTX110, targeted towards CD19-positive malignancies late last year, and we hope to provide additional data this year. I think for our CTX120 and 130 programs, we will have data this year -- initial data this year across both those programs as well as they continue to enroll patients. And regenerative medicine, as I said, is a very broad and powerful platform. Our first foray into regenerative medicine is with type 1 diabetes. And here, we're partnered with ViaCyte in a 50-50 collaboration. We hope to file an IND or CTA later this year and begin clinical trials with this program. And finally, with our in vivo programs, we have a number of programs. GSD Ia is wholly owned. And then a few programs that utilize viral vectors for delivery like DMD, myotonic dystrophy and cystic fibrosis, where we're partnered with Vertex, and we use AAV vectors to deliver the CRISPR/Cas9 gene editing mechanisms to the right organs. A few words on hemoglobinopathies. These diseases are devastating blood diseases, both sickle cell disease and beta thalassemia result in significant comorbidities and early death. In the case of sickle cell disease, what you have as a root cause is a mutation in the beta-globin gene. In the case of thalassemia, there's a mutation in many parts of the gene, which could result in a deficiency of beta-globin, which is a subunit of adult hemoglobin. And in both these cases, you have significant morbidity and mortality. But not only that there's a very heavy burden of patient care, the cost of managing severe sickle cell patient in the U.S. is over $300,000 per year, as shown by recent publications release from CMS. In these indications, what we're doing is recapitulating nature. There have been a number of studies across populations around the world, which showed that if patients or people, I should say, have high fetal hemoglobin, even if they have the genetics of sickle cell or thalassemia, they don't -- they're asymptomatic or their symptoms go down the higher the fetal hemoglobin. Now what's happening here? We have 2 copies or 2 forms of hemoglobin. One is adult hemoglobin and the second is fetal hemoglobin. We're all born with fetal hemoglobin. And within 6 months of being born, our body has a regulatory mechanism where the fetal hemoglobin is down regulated and the adult hemoglobin takes over. In some people, because of existing mutation or some of the regulatory element, their fetal hemoglobin has never turned off. And they have higher levels of fetal hemoglobin. And even if they have the genetics of thalassemia or sickle cell, they can overcome that with the high levels of fetal hemoglobin. These studies of patient populations led us to this approach where we actually use CRISPR/Cas9 to recreate the same mutations seen in nature to elevate fetal hemoglobin and overcome the deficiency or defectiveness of beta-globin gene. This was all supported by a number of preclinical studies that went into our IND and CTA filings. And then we started these 2 trials, CLIMB-111 and CLIMB-121 trials. And these were the pioneering CRISPR trials where we've dosed more than 20 patients across both of these indications. The trials are designed in a way where -- while they're Phase I/II, there could be registrational trials for patients with transfusion-dependent thalassemia and severe sickle cell disease. We started these trials in patients of age 12 to 35. But we've indicated that we've expanded this or trying to expand this into pediatric populations as well as we see effect -- efficacy and safety in the early patients that we've treated. I'll talk more about the patients in each of these. But essentially, we showed data first in November of 2019 and then subsequently at EHA and ASH Conference last year. And these data on Slide 8 showed data from TDT, transfusion-dependent thalassemia. And what you're seeing in these data are that within a couple of months of being treated with CTX001, you're seeing significant elevation of HbF, which is fetal hemoglobin. And what you see in this chart as dark blue is HbA. This is adult hemoglobin from the transfused blood that these patients have, and that decays over time. But then the fetal hemoglobin takes over and becomes the majority of that compartment. And what you're seeing are very high levels of fetal hemoglobin expression in these patients that render them transfusion independent. So you have patients coming in, and the first patient that was treated was a 19-year-old female at the time who came in with requiring more than 1 transfusion a month, significant burden on quality of life, significant anemia, all the risks of organ damage from severe thalassemia. And after that patient has been treated, they have normal hemoglobin levels on account of the elevated fetal hemoglobin and that's gone out now over 18 months. So this is a very durable therapy as well. So this is -- these are striking data, albeit early in only 7 patients, the same pattern has been seen across these patients, regardless of genotype. And on Slide 9, we show the different genotypes here. And what we show are the time for which they've been transfusion independent, which indicates the durability of therapy that utilizes CRISPR/Cas9. And this -- to get these kind of data with the first foray for CRISPR/Cas9 into medicine is truly remarkable, and we're quite bullish that these effects can be seen with patients across all genotypes and can help every patient that's been treated with CTX001. I have to remind you that -- before I go into sickle cell, that what we're doing here is a onetime procedure. This is not like traditional medicine where you're taking chronic medications. These are patients that come in, have myeloablative transplant procedure to receive CTX001. And that does come with some side effects. So far, all the side effects that we've seen with CTX001 are all consistent with busulfan conditioning and nothing related to the drug that's an SAE. And I think we continue to monitor carefully all the SAEs and effects on patients, particularly in light of some reports from other approaches that utilize these transplants like the Bluebird approach, where there have been reported cases of MDS in these patients. So we haven't seen those SAEs in our patients, but safety is foremost for us as we approach these studies in these patient populations. We saw equally remarkable data for sickle cell disease. And in these data on Slide 10, what we show for 3 patients are the elevation of fetal hemoglobin after transplant with CTX001, that's shown in light blue. And early on, the hypothesis based on natural history studies was that if you have more than 20% fetal hemoglobin, you're likely to cure sickle cell disease. Here, we have more than 40% fetal hemoglobin in the first 2 patients. And on patient 3, while it's 31% at month 3, that was still climbing. So I think we're well above that bar, that could be a curative effect for these patients. And what's most important is for these patients, as we look at durability, these were patients that came in with a very high VOC burden over the last 2 years before coming into the study. And the -- the first patient is out more than 15 months and have not had a single VOC after treatment with CTX001. And all patients, for those who are getting into specifics of these data, have detectable haptoglobin and improved LDH, indicating no evidence of hemolysis in these patients. Let -- I'll move on in the interest of time to our allogeneic CAR-T platform. We have probably best-in-class and the most powerful allogeneic CAR-T platform out there on account of the fact that we have CRISPR/Cas9 gene editing. With CRISPR/Cas9, we can make edits to 5, 6 to 7 different edits to these CAR-Ts to make them more powerful, make them more stealth and ultimately improve both efficacy and safety. We all know the advantages of allogeneic CAR-T relative to autologous CAR-T. And I think at this point, we've advanced our first-generation CAR-Ts, which have 2 different types of edits. One is we disrupt the TCR locus, insert the CAR in that same locus, and we also disrupt the MHC Class I complex by editing beta2M, which should allow for these cells to have greater persistence in patients. CTX130 has an additional edit, that we have not disclosed yet, but that also allows the cells to be more potent. All of these constructs are done using CRISPR/Cas9 in 1-step process and the cells are relatively healthy and robust from a cytotoxicity standpoint before being introduced into the patient. We have the CARBON trial where we disclosed data for CTX110 late last year. And here, what we do is we treat the patients as soon as they're screened. Unlike autologous procedures where you have to manufacture the cells, here, you can lymphodeplete the patient and start CTX infusion right away. And what we show were very encouraging data for patients that were severe, and this is a dose-escalation study, CARBON, that's gone from dose level 1 all the way to dose level 4. All these patients were DLBCL patients with significant disease burden, and were either -- some of them were refractory to previous treatments and all of them had a number of prior treatments, which had not worked. So for these patients, which they were -- they don't have many other options, we showed data for 11 patients, that's shown on Slide 16 here, were above -- at dose levels above DL1 and above DL2, you had significant response rate and a significant complete response rate at that. Now we did have an event with the dose level 4 patients. I'll talk about shortly here. But to get this level of response rate at the 1-month mark with the allogeneic therapies is amazing. And I think it shows that we have an active drug. We did see that these CAR-Ts expanded in the patients. You can see that the expansion after treatment as they recognize the cancers. And then more importantly, we saw the evidence of the CAR-Ts detected as late as 6 months out in one of the patients that we -- where we looked at it. So really good response rate. We do need to look at the durability of response to make sure that these indeed can provide the 9-, 12-month durability of response in these patients than autologous CAR-Ts have and that's something we're observing. What's also remarkable is the depth of response. And you saw very deep CRs in these patients at high dose levels. And here's the swim lane chart that we showed back when we did the data disclosure. And we have patients going out. One of the patients that was going out almost 6 months there, even at low dose levels. And we're hopeful for the patients at higher dose levels to show durability beyond -- month 3 and beyond that we show here. In terms of safety, the drug was very safe below -- at DL3 and below. At DL4, we did have a patient death related to the administration of the drug, but it wasn't clear if it's related to the drug itself or the -- or other factors. What we did find was that this patient had HHV-6 reactivation. It was initially suspected ICANS, ended up being HHV-6 reactivation and subsequent encephalitis that led to the patient's debt. But even in that patient, there was a complete response at DL4. In the interest of time, I'm going to skip forward, but what I just want to say is our allogeneic CAR-T pipeline is growing. Right now, we have 4 different clinical trials. We have CTX110 in CD19 malignancies. We have CTX120 in multiple myeloma. And CTX130, we're starting trials. We're conducting trials in both heme malignancies as well as renal cell carcinoma. And they're all enrolling rapidly, and we'll provide updates as we go along. We won't have time today to talk about our regenerative medicine programs and in vivo programs, but we're quite excited that our ViaCyte partnership with our type -- in type 1 diabetes is maturing, and we hope to file an IND or CTA by the end of this year. And we continue to make meaningful progress with our in vivo programs. So I will pause there. I think -- and I know Gena has some questions to ask, but we're trying to build the leading gene editing company. And in fact, beyond that, it's the leading cell therapy company at this point. Across a number of indications, we've built capabilities that are world-class. We have our own manufacturing facility that will come online next year. We have new headquarters that will -- that can hold up to 1,000 people as we expand our capabilities and our workforce, and we're quite excited for what 2021 has in store for us and beyond. So thank you for the opportunity to present. And Gena, I'm happy to answer any questions you may have.

Thank you, Sam. So maybe I'll just quickly ask about the beta-thalassemia sickle cell, the CLIMB-111 and 121, these are potential to be registrational trial. So what would be that condition for this to become a registrational trial? And what kind of feedback from FDA regarding the signing off for this to be registration?

Yes, our intention all -- right from the beginning was to make these registrational trials. With that comes the territory of making sure that you're doing this -- these trials in a manner where we have all the assays qualified, all the manufacturing qualified in a way that's robust and high quality that's typically necessary for a registrational trial. I think our -- we've received RMAT designation from the FDA and the PRIME designation from EMA, which allows us to have very frequent communication with the regulators and work collaboratively with them. So we're continuing to have good discussions. I think at the point where we have full confidence, and we have a clear path to registration, we will update the street on that. But we're confident that we can move these fast. And given the pace of enrollment and the fact that we are ready from CMC and all other perspectives, we should be able to provide regulatory guidance this year.

, Okay. Great. And then you're also mentioning a [indiscernible] event, although we do not expect much [indiscernible] programs. But any additional -- like have you discussed with FDA, any additional concern or additional safety monitoring or data requirement from the FDA?

Yes. Thank you for that question. And I think you're one of the analysts who delve the deepest into this -- into these events that were observed for Bluebird, and we appreciate that. We have had no impact in terms of any of our regulatory communications or any requirements for our programs. That said, I think we are watching very closely. We've seen a number of publications where there's data for 1,200 or so or 19 -- one publication, 1,900 patients where sickle cell patients got allogeneic transplants, and you didn't observe these kinds of events in such a big data set. So we don't think this is caused by busulfan, especially if we get into the target range of conditioning that you're required to in these patients. So you fully myeloablate them. But that said, I think we want to hear from Bluebird and other companies -- from Bluebird and what's happening with these patients. And something that's top of mind for us to ensure safety of patients in our trials. And ultimately, those that are going to be treated commercially.

Okay. And just quickly on the allo CAR-T program. You mentioned that the CTX130, you have additionally added. Just wondering what is the reason or purpose for that? And is that because like any concern about current generation that the efficacy or safety or anything you wanted to improve to the next level?

No, it's not because of concern. I think these choices, by the way, of what the design is of a product you make well beforehand, right? I mean you quick go on a design of a product 1.5 years before you -- before you start clinical trials or maybe more sometimes. So the reason for the additional edit is for ease of manufacturing and also to improve the -- to prevent exhaustion in solid tumors. Because we're taking CTX130 into solid tumors, and we know that in solid tumors, one of the reasons CAR-Ts don't work is because they get exhausted in the tumor microenvironment, we wanted to make an edit that prevents some of that exhaustion.

Okay. That makes sense. And lastly, quickly on the BCMA. Allo CAR-T data expectation, we know allogene -- autologous CAR-T set pretty high bar. On the other hand, we do not see very impressive data from allogene program. So where do you see your program -- or your goal is for your program?

Yes. I mean I think the bar is very high from the autologous program. With Legend, you've seen relatively high response -- near 100% response rates, relatively high VGPR and CR rates in those patients. I think there will be some tolerance around the efficacy you would need around the Legend bar, if you will. Because this is allogeneic, and it's easier to administer, and there are a number of patients that can't avail of autologous therapies, but it's plus or minus, 10% from a CR rate perspective. So we do need to hit the very high bar. I think -- but I think we'll disclose data on where we're coming out in our initial data release with BCMA. And don't forget that with allogeneic therapy, there's always ways to improve on the data, right, because you can make changes to lymphodepletion. You can make changes to cell dose and everything else that you cannot do with autologous therapies. So if we're within range of Legend data, plus or minus 10%, then we're in the game and we can improve and be equivalent or better than autologous therapies over time.

Okay. Great. Thank you very much, Sam. Looking forward to our continued discussion.

Great. Thank you very much, Gena.

Okay. Bye-bye.