CRISPR Therapeutics AG (CRSP) Earnings Call Transcript & Summary

All right. Thanks, everybody, for dialing in. My name is Raju Prasad, I'm the Research Analyst at William Blair who covers CRISPR Therapeutics. I'm required to inform you that for a complete list of research disclosures or potential conflicts of interest, see our website at williamblair.com. And with that, it's a pleasure to have Sam Kulkarni, the CEO of CRISPR Therapeutics, with us for this fireside chat. Thanks, Sam, for joining us.

Thank you for having me.

So maybe just to set the stage for our discussion, you could maybe provide just a quick overview of the pipeline as it stands today and maybe just a few of the upcoming catalysts that investors can expect in '21.

Happy to do that. A decade after the CRISPR/Cas9 platform was elucidated and developed by Dr. Emmanuelle Charpentier and Dr. Jennifer Doudna, we're very pleased to be at the forefront of leveraging this exciting platform for groundbreaking therapies. In a very short amount of time as a company, in about 6 years, we've gone from starting with a platform -- research platform to having multiple candidates in the clinic. Our lead asset, CTX001 in hemoglobinopathies have shown remarkable data and could be potentially curative for patients suffering from sickle cell disease and beta thalassemia. And we'll talk more about this program, but we continue to make progress in that program to get that program to patients in a widely accessible manner through -- by getting to filing and approval. With our oncology programs, we have 3 different CAR-Ts, these are allogeneic CAR-Ts. That means that they're made from healthy donor cells, healthy donor T cells and designed using the CRISPR platform to target the cancers and kill the cancers in patients suffering from diseases like lymphoma and even solid tumors like renal cell carcinoma. Those programs are all in the clinic. And we will have additional data for CTX110 this year as well as initial data for CTX120 and CTX130. 110 being targeted towards CD19, 120 being targeted towards BCMA and 130 being targeted towards CD70. Beyond that, we have a very rich pipeline, starting with our diabetes program where we take artificial -- we create artificial pancreas from iPS cells using CRISPR, and that should go into the clinic end of this year and a number of in vivo programs that are also moving towards the clinic rapidly. So very full pipeline. We're very excited with everything that's going on. We're over 450 people now as a company and expect to keep marching on, especially as our own manufacturing facility comes online next year.

Great. Thanks for that. Obviously, with EHA coming up next week and the data update in sickle cell and beta thal, maybe provide just a little bit of context on what to expect in terms of data updates. Obviously, you provided updates on enrollment recently within the trial. And then maybe after the ASH data, if you could provide any color on how physicians are looking at the data set to date and how enrollment has proceeded since the data update at ASH last year.

Yes. I think ASH last year was a very important milestone for the program. I think it was truly seen as a proof-of-concept, or POC point, for thalassemia and sickle cell. We presented data there for 10 patients, 7 thalassemia and 3 sickle cell patients, and all 10 patients were symptom-free. In the case of thalassemia, those patients didn't require transfusion anymore within a couple of months of being treated with CTX001. And all the sickle patients were free of hospitalizations or vaso-occlusive crises. And that's a remarkable difference for these patients that were in -- living with serious disease their entire lives. So that was seen as a big sort of proof-of-concept point. And subsequently, what we've disclosed is that we've dosed more patients in our EHA abstract. There is a greater number of patients. We have 14 patients, 10 thalassemia and 4 sickle cell patients. And we also said that we dosed 30 patients now. So I think the program is getting more and more momentum. Both trials are designed to enroll up to 45 patients. But we don't even think that we may need 45 patients worth of data for approval if the data continue to bear out and hold out. So I think we look forward to providing continued updates as we go along at this conference and next.

Great. And then there's obviously a lot of development in the ex vivo HSC space with sickle cell. Maybe just provide a little bit of color on how you're viewing CTX001 in the context of the clinical development landscape. Obviously, a bunch of different modalities looking at HbAT87Q, HbF and HbG-Makassar, for example. So just would be interested to think about, as the leader in your particular modality, how are you thinking about your program as well as potential competitor programs that might get advanced in the clinical trials in the future?

Yes. There are a number of programs in this space. But I think the advantage we have at this point that positions us as a key -- as a clear leader in the space is the fact that the data of CTX001 is quite remarkable. I think every patient so far has been free of symptoms. As you compare that to lentiviral approaches, the data look better. And when you combine that with the fact that CRISPR is a notionally safer approach relative to random integration with lentivirus, I think you'll have a huge advantage in the marketplace. So I think you have 2 players now neck and neck at the front. But we believe that CTX001, especially with the capabilities that Vertex brings to the table in terms of commercialization globally, we would have a significant advantage. I think there are a number of players that are following in our footsteps. But I think in this market, time is an important component. I think it's going to be difficult for players to get a commercial foothold if there's been a player existing already for 4 or 5 years with very good data, right? I think this is like the medical device space. And shares are sticky because there are certain centers learn and train themselves on a certain product, and it's not very easy to switch. So I think while it's -- it won't be difficult for people to enroll patients because there's a lot of demand for gene editing in sickle cell and thalassemia, I think commercially, we are well positioned to take on that leadership mantle and maintain it over time.

Great. And you mentioned Vertex, and I want to kind of drill into that a little more. I think it's a very innovative partnership and obviously, the recent deal that you guys did to amend the partnership provided the company with significant upfront capital for fairly minimal economic terms. So maybe can you just talk about how the Vertex collaboration started? And then with the most recent deal with the negotiations over the 10% and the control of the launch, how you were thinking about it from a CRISPR's perspective?

Yes. It all started with ASH conference last year. We presented data and we said, "Oh my God, look at the response from physicians, from the patient community, the patients themselves," while we had exciting data with one patient in thalassemia or 2 patients in thalassemia, 1 in sickle earlier, having 10 patients worth of data made a big difference. I think everyone was looking at the program very differently and saying, "Gosh, this can be a huge advance in the field of medicine." And I do think that 20 years from now, we are going to look back and say that was the moment, ASH 2020, when these data were presented that marked the arrival of a new class of medicines that may change the face of -- change both delivery of care with curative therapies and change the way we think about diseases and amelioration. So I think as we looked at both Vertex and I said, "How do we make sure we execute very quickly and get to a global launch?" And in the original construct, we had CRISPR as the commercializing party for the U.S. with Vertex for ex U.S. But in this context, as you look at the data, the trials are global. We're looking at the market in a way that there's a lot of shared responsibilities from a central global marketing, I would say, versus regional. It makes sense to have a coordinated launch, to have one company lead it, whether it is CRISPR or Vertex. And I think just looking at it from a capability standpoint, it made sense to align the capabilities in a way where you can leverage all of what Vertex have to get this globally coordinated launch and bring their best practices to bear from cystic fibrosis in other markets to ensure that we can reach as many patients as we can. In the meantime, I think CRISPR's capabilities are best harnessed thinking about what's sort of the next horizon, which is how do we come with gentler conditioning agents to further expand the market? How do we come up with improvements in process and analytical capabilities to that so that we can further streamline the patient experience and improve outcomes for patients? So I think it aligns capabilities well. The capital does make a difference for us as we further expand the rest of our pipeline. And most of all, I think it makes sense for patients suffering from sickle cell disease and thalassemia because this is the best chance of making sure that this program gets wide access to all these patients that need and deserve the therapy.

Yes. And obviously, you touched on this a little bit, but the global manufacturing cohesion that you have, can you maybe just describe a little bit about how that -- how to view that in the context of the rest of the pivotal -- the rest of the current clinical trial as well as approaching the agency just given some things that we've seen in the space recently with regards to regulatory plans with the lentivirus procedure? It would be interesting to kind of hear how you're going to be approaching it, learning from some of the things -- some of the aspects that the first mover has had to go through.

Yes. I think one of the advantages we have is, right from the get-go, we said we're going to do 1 global trial. We're not going to separate our trial for U.S. and Europe. We also said from the get-go, we're going to have 1 manufacturing process that can be scaled into commercial whereas just starting with something that's more of an experiment, right? So I think that, combined with the fact that the regulators are quite closely in touch across the U.S. and Europe, it gives us that ability to sort of advance this as 1 global trial ultimately with the notion that the filing package would be similar or same across U.S. and Europe. Now I think the rest of the world and Asia is a different story. But at least at this point, that plan seems to hold true. We have the RMAT designation in the U.S., which gives us the ability to have frequent dialogue with regulators in the U.S., and PRIME designation in Europe, which also gives us the same ability to speak with EMA folks quite regularly. And I would say that everyone has been very supportive. Now ultimately, when it comes to commercial and reimbursement, I think that will be different by region, right? I think you'll have a different way of looking at reimbursement for maybe Germany versus Italy versus the U.S. And there, we have to have a more nuanced and bespoke strategy. But otherwise, I think this notion of global trials makes a lot of sense. It gives us -- it allows us to move faster and allows us to make sure that we have a very coordinated package.

Yes. No, that's helpful. If we could switch gears a little bit into the oncology pipeline. Obviously, going to be 3 separate readouts for 2021 from this pipeline. With regards to CTX110, you presented some initial data there, seeing a 50% CR rate, pretty impressive proof-of-concept in T cells now building on the HSC platform. What should we expect in terms of updates on the 110 program? Obviously, it's going to be a focus on -- more on durability now from those initial patients, but maybe you can set the stage on what to expect from CTX110, any update, and then maybe you can touch a little bit on context with some of the other players in the space.

Yes. I think data from the different allogeneic therapies is good. It just basically signals that allogeneic therapies are here to stay. You're seeing response rates and CR rates that are similar to autologous therapies, right? I think you're -- that's something that's important. And in fact, you're seeing some notion of durability. It's -- we have to -- the trial is still early where we can't really compare apples-to-apples, but there is a notion that patients can be in CR for a long time based on allogeneic therapies. And the big switch, I think people are trying to understand how allogeneic therapy is different from autologous therapy. I think we still get a lot of questions at CRS and ICANS. I think that's -- not a lot of people understand that, that may be more from an autologous phenomenon than allogeneic because you just don't have the same kind of expansion. I think you saw something yesterday in the news around ICANS with autologous therapies, but you may not necessarily see that with allogeneic therapies, even if you have the same potency of killing, right? I think you have cell expansion relate -- as the allo-CAR-Ts go in there and kill the cancer cells, but it may not be the same profile as an autologous therapy, right? And in fact, even as you look at autologous therapies, there's correlation -- there's some correlation or expansion to CR, but it's not a perfect correlation. And so we're learning more about CAR-Ts in general and we're also learning more about allogeneic versus autologous therapies, and the same sort of metrics and lenses that you apply to autologous may not apply to allogeneic. And what we've learned is a year ago, there were probably 2 schools of thought. There's like this notion that you're going to redose every time you progress, and that's how you're going to ensure durability. And now there's this notion that you can redose preemptively as a consolidation dose, and that's the way to get durability because you've completely eliminated the cancer. And I think -- I'm glad the field is pursuing both those options to see what's better. But in all eventuality, you're going to get allo therapies approved in the lead line settings. And once you're getting to approval, it's going to leapfrog autologous therapies because it's going to move much faster. It's hard -- easier to enroll patients in allogeneic therapies versus autologous therapies. Imagine trying to expand your autologous cell therapy trials to community settings. It's just very slow. You're not going to get there. Now all that said, I think as we look at the data for ourselves versus other companies, there are many different ways to look at our data. Eventually, when we disclose the data, you'll have a basis for comparison. But I think the beta2M strategy gives us that persistence that's important for killing the cancer cells. And I think ultimately may be a safer approach with Flu/Cy conditioning relative to adding a CD52 antibody. I think those are all things that will be important to compare or contrast as we go along. But it's less about us versus another company in allogeneic, it's more about allogeneic versus other modalities. And I do think the sheen's worn off some of the bispecifics. If you think about ASH last year or where we were last year at this point, there was a lot of excitement about bispecifics. Bispecifics have the same toxicity issues that autologous therapies have. And I do think allogeneic therapies are well poised now to becoming a very important part of the treatment landscape in lymphoma and other diseases.

Yes. One quick question on 110. I mean you mentioned the consolidation regimen. Is that something that you might look at with 110? Or is that something that you would need to add an increase in grafting window to do something like that?