Editas Medicine, Inc. (EDIT) Earnings Call Transcript & Summary

Good afternoon. My name is Gena Wang. I'm 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 a corporate access team who made this virtual health care conference possible. With that, I would like to introduce our next presenting company is Editas. With us today, we have Jim Mullen, Chief Executive Officer; Lisa Michaels, Chief Medical Officer; Michelle Robertson, Chief Financial Officer. With that, I hand over to you, Jim, for a brief overview of the company.

Thank you very much, Gena. We're very happy to be here today. Thanks for hosting us. So let me give just a high-level overview, and then we'll go right to the questions and answers. I think as most people know that are on this, Editas Medicine is really based on gene editing technology with several enzymes, the Cas9, Cas12a, et cetera. In addition, on top of that platform, we're really working in 3 different areas: in vivo editing, ex vivo editing and cellular therapy. Within the in vivo editing, we are really the first company to be -- do in vivo editing. We've got a program in the eye. We have a series of other programs that we're working on to bring forward to INDs to continue that platform. On the ex vivo side, we just -- we will initiate trials this year in sickle cell disease, and we will file a follow-on application for beta-thalassemia. And then in the cellular therapy area, we're working with iPSCs that we edit, clone differentiate into various cell types. In this case, our lead programs are in iNK cells, which we think have exciting potential in immuno-oncology settings. And with that platform, we would be able to do multiplexing editing and really create a series of products. So at a very high level, that's what we've been working on. And I like to think of the next few years is really reducing to practice in the clinic, each one of these platforms and beginning to show the power of gene editing. And also the clinical benefit of gene editing. So with that, I'll turn it back to you, Gena, for Q&A.

So maybe wanted to ask big picture questions just recently become CEO, of course, you being involved in the company for pretty long time. You're a Board member. So now as a new role, what is your vision for Editas for the next, say, 3 to 5 years?

Well, first, why am I involved? It's a very exciting area, and it's sort of rare. I got -- I was involved in maybe the first and a half wave of biotech back in the late '80s and the '90s, and of course, spend a lot of time with Biogen and started there when Biogen was actually smaller than Editas. And so I've seen this movie before, how you really develop a company. And this technology is particularly compelling. It both -- it's compelling in just the sheer breadth of the potential applications of the technology, but it's also a little humbling in deciding where to start first. So when you -- when I look at the next 3 to 5 years, it's going back to those 3 big platforms, not so much contained to the therapeutic areas that we've started with, with each one of these platforms, but looking how do we actually take these platforms, the in vivo, the ex vivo, the cellular, and reduce it to practice, create really interesting products that we can deliver and manufacture and deliver clinically and show clinical benefits. And if we can do that on one or more of these platforms, I think the number of areas that we can think about are enormous. Now along the way, because I've been in biotech and pharma long enough, everybody needs partners for different reasons. And each one of those areas has a different set of characteristics that caused us to think about how we would partner those eventually. And of course, if you need partnering for both expertise and development expertise, commercial expertise and all the rest, but also capital. These companies at this stage are -- require a lot of capital to move from this stage to a really successful commercial stage company with real revenues and dare I say profits.

Okay. So maybe go to specific technology. So any -- how do you see Editas CRISPR/Cas line or Cas family, where we do have a Cas12, versus the other CRISPR companies?

Well, we're really the only company that's working with both Cas9 and Cas12. And while the Cas9 family, if you will, of IP has have some of its challenges with who's going to end up with the dominant IP, the same is not true about Cas12. And so we're working on both of those platforms. And they have their pros and cons, and I'm -- what you really need to talk to on the -- detail the pro and con, really somebody a bit more scientific than me and maybe Lisa can add something to that.

No, just simply I'll add is that one of the real values of having both of the editing platforms allows us to get various different genetic targets that wouldn't have actually been approachable. I think one of the real challenges that we face with the sickle cell program is really wanting to get a more physiologic edit in place. The one that actually is a little bit more similar to the normally occurring hereditary persistence of fetal hemoglobin mutation. It's actually not approachable with the Cas9, and it was really the Cas12 that allowed us to be able to get that particular target. The other one is also with our in vivo applications because we have a different platform based upon staph aureus versus pyogenes. Actually, it's a much smaller construct. So consequently, it actually enables our in vivo editing programs. So there's real differences across the different editing platforms that can be exploited, but we think we differentiate in terms of specific targets as well as the enzymes that we're using.

Great. That's very helpful. So also maybe continue with the big picture question. Jim, any thoughts on the business development or partnership strategy?

Yes. So let me sort of go, again, sort of my in vivo, ex vivo and cellular therapy because I think each one of those have a different characteristics. So if I just start with the ocular space. We had the partnership with Allergan. I think that was progressing fairly well. As you know, they were absorbed by AbbVie. And this was not in AbbVie's interest area. So we were actually quite happy to reacquire all the rights in the ocular space. And I think there's nice synergy from one program to the next in that space. So I think there'll be a lot of learnings that we can really -- learnings and technology that we apply program to program. It's also a space that I can imagine, you can actually take all the way to a commercial market as a company like Editas, at least in the U.S. If I look at the sickle cell area, that's going to be -- that's quite competitive. As we all know, there's a number of programs in the clinic. We think we have a quite differentiated approach. Lisa can speak to that later. But I think that's also going to be a market where multiple players are going to appear. And we'll see what all these products look like in terms of their efficacy, durability and their safety profiles as the clinical data unfolds, but there's going to be room for multiple players. And I think that's probably going to be a relatively slowly unfolding market based on the patient population and the history there. If I then go over and look at the cell therapy and our initial focus being the NK space, immuno-oncology is extremely competitive in discovery, in clinic and clinical development and commercially. There, we will certainly want to have partners along the way for both development expertise and commercial access. It's probably too early to want to do that, right this month, if you will. But we'll certainly want to look in their directions. And then that's also a quite expensive place to do development. So I think we want that also for derisking and capital access. So from a business development, I sort of think about those as 3 big things, and we'll continue to look at bringing in and accessing additional technology to broaden out our technology base. So we'll continue to keep that in our focus as well.

Jim, full suite approach, any indication, you will more -- focusing or versus some other indication you try to avoid?

Well, we have enough progress in all 3 of these fronts. I think we're going to continue moving forward on all 3 of these fronts. Obviously, EDIT-101 is in the clinic, the challenge in that it's a quite rare disease. It was a bit challenging, particularly in COVID because some of the original patients that we'd hope to enroll were going to have to move across international borders, which became impossible. In fact, just getting people to move around at all. Whether it's within the borders or across international borders became very difficult. So we're beginning to build momentum on that. And I'm pretty happy we'll see data this year from that. And hopefully, we'll see some positive outcomes there. The -- I think in the sickle cell area, the concept of autologous cell transplant and the preconditioning regimens and all that, that road has been pretty well walked. So I think that's more of a question -- while it's a complex manufacturing and delivery, if you will, people have successfully done that. So I think it's really now a question of, will we get the editing efficiency? Would you have the durability? Did we pick a differentiated and better area to edit? But I think that's -- you'll get pretty clean readouts from those clinical trials based on what we've seen from other people. iNK is trickier, right? It's also a very powerful platform if we can reduce that to practice to say I can take an iPSC, I can edit it, I can clone it and I can differentiate in cell types. iNK is a place to start, but it's not the place to stop, if you will. I think that's trickier, but a very potentially powerful platform.

Okay. So I'll go to the specific program, EDIT-101 and LCA10 for year-end update. Is it fair to say that we should have data from both patients in low dose and for patient in the mid-dose and potentially -- or even some patient at the high dose?

So I'll jump in on that one because I think that's my question. But I think at the end of the day, it sounds like a lot of people are doing very good finger counting at the moment. So we had 2 patients who've completed cohort 1 for -- who were dosed in cohort 1. The first of those patients was dosed in February of last year, and we're just looking at the 12-month follow-up visits with her at the moment. She's been a real challenge, getting back and forth because this is a patient who had to travel from Southern California to Oregon and COVID has not been kind to that part of the world in terms of having open borders. But she is due to come in for her 1 year evaluation. The second patient wasn't treated until September of last year. He's coming in also now for a 6-month visit, which will give us the first opportunities to have reproducible visits after he's gotten through the first treatment. So we had visited 3 months now for 6 months. Meantime, the first patient of cohort 2 has been treated. And after the modifications we made in the protocol at the end of last year, it looks like we have a fairly clear path to it, at least get through the second cohort of patients. So if I'm optimistic, I hope we will be able to provide data both on cohort 1 and cohort 2 after some reasonable follow-up period on all of those. As for getting to the end of the year, I'm willing to leave myself open as to the total data set that will be presented. But at the moment, I'm feeling fairly confident and we hope I will remain optimistic regarding the ability to have some meaningful readout on this middle cohort because it is the one where we're expecting to see the best -- the first good chance for a real signal of efficacy.

Okay. And for the data, clinical data, you did listed quite a lot of measurements, vision acuity, mobility, macular thickness and et cetera. So like, how frequent do you collect these data points? When you share with us, that would be a very clear trajectory of a patient data or like -- yes.

So the first -- so the way the protocol is written is all the patients undergo very close observations, primarily for the purpose of safety and dealing with adverse events related to the injection procedure. And that's over the first 4 to 6 weeks of follow-up. We do have baseline and measurements at baseline as well as at the end of that 6-week period of time. But the expectation is the first real clinical data that will not be impaired by any adverse events related to the procedure. It's probably a 3-month visit. And then after that, we're following them every 3 months for these measurements at this part of the protocol up to a year. So the primary readout really is at 1 year follow-up. What we know from the nonclinical data as well as experiences from LUXTURNA is that you might see the earliest signals of activity as early as 6 weeks. But what you're looking at in that particular setting, it's probably more physiologic measurements, such as any changes in retinal anatomy, responses to light. All of these patients have significantly impaired pupilar responses to light. But those don't necessarily translate into meaningful vision. At the end of the day, probably the most important outcomes are the ones that translate something of actual value to the patients. And in that particular setting, what we're probably looking at is whether there's any improvement in the visual fields, best corrected visual acuity or even their ability to maneuver between obstacles and different levels of light. So all of these things that are the types of observations that we're collecting and it really is going to be the full body of evidence that will help tell us whether or not we've achieved meaningful edits.

Okay. That's very helpful. And then I assume you would not collect the human -- would not be able to -- at the human editing data, right?

No, we have to interpret that on the basis of the predictive nonclinical data, which we have from both a mouse model, nonhuman primate plus fairly good evidence that we have, we're able to get very good editing efficiency in human fibroblast. But at the end of the day, it still comes down to patient-reported outcomes. And that's going to be what -- I would love to be able to come back and say we achieve 60% editing. But at the end of the day, the clear readout has to be on what the patients report to us in terms of the changes in visible -- and vision.

Okay. Good. Now quickly on the sickle cell. How many patients can you dose under the [ partial clinical hold ]?

So the way the -- Yes. So the protocol was written with basically a safety run-in portion. And in that protocol, there are 4 patients and they are dosed sequentially. One patient, treat him, make sure that we have engraftment, make sure that we start to have the improved function that we expect to see. After a designated wait period in the protocol, we then dose the second patient and go through the same exact exercise. And then once we get to patients 3 and 4, we're actually able to do them in parallel. But the protocol always require the measurements and the observations in those patients before we moved on to the full treatment study, which we actually think potentially could be a pivotal study. But clinical hold does not stop anything related to those activities. It doesn't actually impair our ability to treat patients, and it hasn't made any differences in terms of the plan and the progress that we were expecting to do. So we have that almost 2-year period of time for dosing patients in order to provide the FDA with the additional evidence that they need. In the meantime, the FDA did provide us with a little bit more clarity as to what the specific questions were, and we're planning to go back to them this summer with a little bit more detail so that we can actually have an agreed-upon path to lift that hold before we get to the second part of the study.

Okay. Lisa, so maybe like, several questions here. First, what is the waiting period for the first 4 patients? It seems like it will be a few months, right? You engraft, you wait for them to engraft and then -- okay. So any particular time you can provide the waiting here in between the patient?

No. I think at the end of the day, it really is that 6 weeks to 3 months period of time in which engraftment is expected to take place.

Okay. So 6 weeks plus...

It's going to be depend on the patient. We can only extrapolate from what we see across other programs. It's -- that's basically up to a 3-month period of time that we would expect the patients to have full engraftment. And then after that, remember, all these patients actually had to undergo hyper transfusion regimens, so then you need to watch them over the next several months as the hemoglobin drops off so that you can actually see that they're producing hemoglobin F instead of hemoglobin A that they were transfused with.

Okay. So basically, the safety phase will take quite some time. Just...

Well, I remember I took it -- if I extrapolate also from CRISPR, it was 1 year from their IND until the first patient was actually given dose. So we're trying to be more aggressive than that. And it was a longer waiting period before they reported on their first 2 patients. We're trying to be more aggressive, but I think that gives a fairly good time line for what would be expected in this space. Yes.

Okay. That's fair. And then the second part of the question is if you get a little bit more color from FDA, what additional requests do they ask? And then also I recall the initial quotes on the potency assay. Can you give a little bit of color on what additional feedback you get? I assume you already had at least 1 round of interaction with FDA that's going to get some feedback.

That's the plan for this summer. So like I said, the FDA will give us a little bit more clarity with the IND letter on basically what they're looking for in that particular area. And what it really translates to is our ability to show it to them that every single time we do this, that our product that is released to the patient is consistent from patient to patient and batch to batch. And because of this concierge medicine, every patient is the process. So what -- basically, what they're looking for is our ability to show to them that we are consistent over time and from batch to batch. We provided already to them a list of various different assays that are part of our release. And the real question really comes down to is, is it really just 1 test? Or is it our ability to show across multiple difference tests? And it's mostly the ability to be able to show consistency across multiple difference tests as well as with the release assays. So this was always something that was expected as part of our development program, and it can only really be validated in the patients. So other than the terminology from the FDA, this was exactly what we expected we would have to do.

Okay. Okay. Okay. And then those should be -- you should have some meaningful data package by mid this year you can get back to the FDA.

So we're going to go back to them with the nonclinical data that supports our position, and we expect that we will probably be able to provide them the data from the first patients in time to start the main level -- the main part of the study.

Okay. And then given -- I think it's this morning, blue hosted [ core ] and then hopefully -- at least I think in one part they mentioned conditioning regimen should not be an issue. So any thoughts regarding your -- the conditioning regimen because of the events? Any modification or any additional safety check you wanted to proactively putting? Or would there be any feedback? Or any thoughts there?

All I could say is I'm happy for bluebird that they didn't find a rental viral integrated in some part of the genome that they could easily attribute it to AML. So I'm happy for their results. I'm not convinced that they're completely done with their evaluation yet. But I think at the end of the day, they encountered a challenge that is probably true for anyone operating in this space is if you, by chance, enroll and treat a patient who has some sort of pre dispositions to developing AML or myelodysplasia or has been on a group of medications potentially like hydroxyurea that could predispose them to it, then it does identify one of the known risks in this area. Can we blame it entirely on the conditioning regimen? I do think it identifies that this probably is the next step in the incremental improvement of treatment of patients with these ex vivo techniques because it's the busulfan conditioning and the period of time after transplant while you're waiting for engraftment that really presents one of the highest short-term midterm risks of the patient. So I think it really just identifies more of the fact that the standard of care in autologous transplant probably can be improved over time. And we'll be certainly watching very carefully to see what other potential consolidation regimens might be reasonable to use in the future as part of the overall development.

Okay. And then regarding the clinical data. So CRISPR set a pretty high bar data. Well, actually, their data looks also good efficacy-wise. So what is -- how do you think of the edit? How you will differentiate it?

I think at the end of the day, we're looking at incremental improvements for safety across all these different programs as well as efficacy. You're absolutely right. CRISPR has actually set a very high bar. We think we can at least match that. We think we have a better physiologic target going after the beta-globin locus over the BCL11A locus. And from my experience in treating patients with sickle cell disease, even though they've achieved very nice high levels of hemoglobin F, there's a lot of evidence that small incremental improvements can make a difference in terms of either long-term complications or -- and organ disease. So I still think that the jury is out as to which of these will be the better treatment. But I also think that sickle cell patient population is large enough that more than one player can exist in that space.

Okay. So my last question is for Michelle. You do have quite lots of cash, $716 million as of 4Q. So first, how long do you think that, that will last, it all depends on the expense? Maybe how would you allocate the capital? And how long do you think that the cash could be assisting in operation?

Sure. So yes, we ended 2020 with just over $500 million in cash and then we recently raised an additional $250 million to extend our runway. So that cash with our current plans would take us well into 2023. As far as how we allocate from our R&D program perspective, it's pretty much equal 1/3, 1/3, 1/3 on the 3 therapeutic areas: the ocular programs, sickle cell and oncology. And in the coming next 12 to 24 months, spending will increase, but in primarily the areas around clinical ops supporting the clinical trials as well as our investment in manufacturing.

Okay. Great. Well, thank you very much for participating, and we look forward to the data later this year.

Thank you, Gena. Take care. Bye.

Okay. Bye.

Thanks, Gena. Bye.

Bye-bye.