MeiraGTx Holdings plc (MGTX) Earnings Call Transcript & Summary

Thank you for joining us today as we give an update of our AAV-hAQP1 program for the treatment of radiation-induced xerostomia. Before we begin, please note that we'll be making forward-looking statements as part of this presentation, which are subject to certain risks and uncertainties that may cause actual results, performance or achievements to materially differ from those forecast. Certain of these risks are described on Slide 2 of today's presentation and in our most recent filings with the SEC. I'm Zandy Forbes, the President and CEO of Meira. I'm joined by Dr. Robert Zeldin, our Chief Medical Officer; and by Dr. Michael Brennan, Chairman of the Department of Oral Medicine and Director of Sjogren's Syndrome and Salivary Disorders Center at Carolinas Medical Center in Charlotte, North Carolina. I will turn it over to Robert to first provide an overview of radiation-induced xerostomia with some insight into the unmet need of this patient population.

Thank you, Zandy. Radiation-induced xerostomia is a serious condition resulting from the reduction in saliva production that occurs when salivary glands are damaged by ionizing radiation. Salivary glands, particularly the water secreting acinar cells are exquisitely sensitive to ionizing radiation. Immediately following treatment, almost all patients treated with radiation for head and neck cancer suffer from reduced salivary gland function and xerostomia that is often debilitating. In the years after radiation treatment, while there is some reduction in severity of the initial xerostomia symptoms in many patients, approximately 85% of patients report persistent xerostomia, 2 or more years following treatment. For about half of those, the symptoms are mild or grade 1. The other half report moderate that is grade 2 or severe that is grade 3 xerostomia, which is life-altering and debilitating. These patients are candidates for our current gene therapy studies of AAV-hAQP1. The remaining 1% to 2% have fully fibrosed glands and grade 4 xerostomia, which is unlikely to be responsive to restorative therapy. There are currently over 170,000 patients in the U.S. alone who are at least 2 years out from radiation treatment with intractable grade 2 or grade 3 xerostomia. We have received orphan drug designation from the FDA for this indication. However, it is a relatively large population, particularly for a gene therapy treatment. In addition, with around 54,000 new cases of head and neck cancer diagnosed annually in the U.S., we estimate between 5,000 to 10,000 new U.S. patients eligible for treatment each year, all of whom are in the health care system with some form of healthcare coverage having been treated for head and neck cancer. These patients are seen at least annually for follow-up by their physicians to check for cancer recurrence, and their #1 complaint while cancer free is debilitating xerostomia. As a result, we have a lot of interest in our potential treatment for xerostomia from those specialists whose patients have been treated for their cancer but are left with the intractable symptoms of chronic xerostomia. This is an easily accessible population with a serious condition and no treatment available. Grade 2 and grade 3 xerostomia is an extremely debilitating condition with multiple severe sequelae resulting from the lack of lubrication and loss of the antimicrobial effects of saliva. In addition to difficulty eating, chewing and swallowing and taste alteration, affected patients suffer from tooth decay, inability to wear dentures, [indiscernible], throat symptoms, changes in oral flora, burning mouth syndrome and other effects that have a very significant impact on their daily lives. Current options for the management of radiation-induced xerostomia are few and are of limited benefit. Nothing is available to improve salivary gland function, and there are no disease-modifying treatments. None of the over-the-counter approaches or prescription medications shown here that are currently available, address the needs of patients who lack adequate residual salivary function. This population has persistent intractable grade 2 and grade 3 xerostomia with no effective therapies available. No drugs have been approved for xerostomia in the past 20 years. The last was cevimeline in 2000. In August of this year, [ Meira ] sponsored an externally led patient-focused drug development or PFDD meeting on xerostomia. The goal of FDA's PFDD initiative is to systematically obtain the patient perspective on specific diseases and their treatments. The FDA considers the patient perspective to be critical in helping to provide context to inform its regulatory decisions regarding new drugs. The meeting provided a forum for FDA to hear directly from patients, their families, caregivers and patient advocates. The meeting was attended by 16 members of the FDA and more than 150 patients and caregivers. On this slide, you can see a few quotes from patients with xerostomia, who spoke at the meeting, describing in their own words, the severity of the condition. The ultimate deliverable of the PFDD is a compilation document entitled the voice of the patient that will serve to guide FDA in making regulatory decisions about new treatments for xerostomia. We will continue to work closely with the patient community, our clinical investigators and the agency to maximize the insights provided in this document, which is expected to be published early in 2022 to advance the clinical development of AAV-hAQP1, a potential onetime treatment for grade 2 and 3 radiation-induced xerostomia. I'll now speak about our Phase I AQUAx study. The AQUAx study is an open-label, multicenter dose-escalation study of a onetime administration of AAV-hAQP1 to one or both parotid glands in patients with radiation-induced salivary hypofunction and grade 2 or 3 xerostomia, 2 or more years following radiation treatment for head and neck cancer. The study is being conducted at 6 centers, 5 in the U.S. and one in Canada. All participants are to be followed for 1 year post-treatment and will then enter a long-term follow-up study so that all participants are followed for a total of 5 years per U.S. FDA guidelines. The study's primary endpoint is safety. Secondary endpoints include change from baseline in patient-reported measures of xerostomia symptoms. The AQUAx study has completed the planned enrollment of all unilateral dose-escalation cohorts, and as of the cutoff date of November 30, 7 participants have reached their 90-day assessment with 3 participants completing 12 months. To date, treatment has been well tolerated with no dose-limiting toxicity or serious adverse events and improvements seen in validated patient-reported assessments of xerostomia symptoms. The favorable safety and tolerability profile and the preliminary efficacy signals that we have seen to date in the unilateral dose-escalation phase of AQUAx have led us to expand the scope of this Phase I study to incorporate bilateral dosing. The protocol has been amended to add 4 dosing cohorts of 3 participants each wherein both parotid glands are treated. The first bilateral dosing cohort has already been treated, and we expect to complete enrollment in the remaining bilateral cohorts in the coming months. With the encouraging preliminary safety and efficacy findings from the Phase I AQUAx study, we are excited to move forward with a Phase II study that we'll initiate in the second half of 2022. We are designing this randomized, double-blind, placebo-controlled Phase II study to obtain efficacy and safety data for more than 1 active dose. The sample size and doses to be included in the Phase II study will be finalized based on the results from the unilaterally and bilaterally treated subjects in the current Phase I study. Based upon regulatory precedent, we anticipate the study's primary efficacy endpoint will be the change from baseline to 12 months in the McMaster global rate of change, patient-reported outcome measure. We expect change from baseline to 12 months in the symptom-specific xerostomia questionnaire will be a key secondary efficacy endpoint. With that, let me turn it over to our CEO, Zandy Forbes, to discuss some of the preliminary data from the AQUAx study to date.

Thank you, Robert. I will briefly describe the mechanism of action of AAV-hAQP1 and then discuss some of the preliminary data from the ongoing AAV-hAQP1 study. In radiation-induced xerostomia, the normal architecture and function of the salivary glands are significantly disrupted, water flow through healthy salivary glands requires a polarized epithelial layer of the water-conducting acinar cells. When salivary tissue is destroyed and acinar cell polarity is disrupted, water permeability is lost and the glands can no longer secrete saliva. Our approach to addressing this lack of permeability is to use an AAV vector to deliver a non-polarized water channel, human aquaporin-1 into the salivary glands. When AQP-1 is expressed in the duct cells and any remaining acinar cells in the disruptive glands, these cells become permeable to water and water flows down the concentration gradient into the salivary duct and then into the mouth. Our AAV-hAQP1 vector expresses the human AQP-1 gene delivered using the AAV-2 capsid. AAV-2 has been shown to transduce human salivary glands effectively and is one of the stickiest of the AAV series types, which means that is it only transduces cells locally with minimal spread into the serum and the rest of the body. We deliver a small local dose of AAV-hAQP1 into the duct of the parotid gland, avoiding systemic exposure and minimizing potential safety issues. As salivary gland cells are very slow dividing, this AAV-hAQP1 therapy is expected to be a onetime treatment. The primary endpoint of the AQUAx study is safety. With dosing completed in all unilateral dose-escalation cohorts and one bilateral cohort to date, there has been no dose-limiting toxicity reported, and there have been no reports of a serious adverse event. Local delivery of AAV-hAQP1 all doses tested appears to be safe and well tolerated. Turning now to efficacy endpoints. When considering approval of new drugs, the FDA emphasizes demonstration of a clinically meaningful change where the benefit to the patient is clear. Previous drugs for xerostomia have been approved based on patient-reported outcome measures and visual analog scale. The last drug to be approved for xerostomia cevimeline was approved based on the McMaster global improvement tool. The McMaster global rate of change questionnaire is a rating system that can be applied to different disease states, and a specific version of this questionnaire has been validated as a patient-reported outcome measure for xerostomia. The McMaster questionnaire includes 2 steps. Step 1 asks the subject to state if their dry mouth is better, worse or about the same following treatment. If the patient reports better or worse, they're then asked to rate the degree of change on a scale from 1 to 7, with 7 being the greatest change and 1 being the smallest. A score of 2 or above is meaningful to the patient. The approval of cevimeline was based on a significant difference in the number of subjects achieving better in Part 1 of the McMaster Questionnaire in the treated group versus the control group. The degree of change for the better was not stipulated. Participants in the AQUAx study completed the McMaster global rate of change questionnaire at baseline and the specified assessment time points following treatment. Preliminary data from this assessment are presented in this slide. At day 90 following treatment, 6 of 7 participants who reached the 90-day assessment, reported that their symptoms of dry mouth were better than before treatment, and all of them rated the degree of change as important or very important with a score of 2 or more. The one patient who did not report an improvement in those xerostomia symptoms had no measurable saliva at baseline. All patients with some saliva production at baseline, even if quite minimal, reported a meaningful improvement in their xerostomia symptoms, no patient reported a worsening of symptoms. Of note, of the 3 participants with data out to 1 year, the improvement in symptoms increased over time, with 2 participants rating their symptoms as a great deal better and very great deal better respectively, with scores of 6 and 7. The first patient treated patient 1-1 who achieved the highest possible score of 7 at 12 months, has just now completed the 24-month assessment in the long-term follow-up study, and the McMaster Questionnaire score of 7 was maintained, indicating durability of the effect of hAQP1 treatment. Participant in the AQUAx study also complete a symptom-specific xerostomia questionnaire, XQ. This is another rather different patient-reported outcome measure, consisting of 8 symptomatic specific questions where the patient rates each of the different symptoms from 0 not present to 10 worst possible. The overall sum of all ratings for all symptoms is then added, so the sum of the responses ranges from 0 to 80 providing an overall measure of disease burden. The xerostomia questionnaire is a refinement of the xerostomia inventory, which consists of 11 questions and for which an improvement of 6 points has been defined as clinically meaningful. A 6-point change in the xerostomia inventory or the xerostomia questionnaire is considered a relatively high bar to achieve as drugs approved based on positive McMaster assessment have failed to achieve this endpoint in registrational studies. In the AQUAx study, 6 out of 7 of the participants who had reached the 90-day assessment reported decreases in disease burden of 10 points or more on the XQ at 90 days, indicating a clinically meaningful alleviation in disease burden. Even more dramatic reductions of 19, 25, 26 and 41 points were reported by 4 of these participants. In subjects who have reached additional time points, the xerostomia questionnaire scores improved and stabilized over time, with 1 subject reporting complete resolution of xerostomia symptoms at 12 months, scoring 0 for all symptoms on the xerostomia questionnaire. This participant has now reached 2 years post-treatment, and the complete alleviation of symptoms has been maintained, still scoring 0 on the xerostomia questionnaire in the long-term follow-up study. Both the response rate and the effect size that we're seeing in this initial group of participants in the AQUAx study is encouraging, particularly as the McMaster questionnaire is an accepted endpoint for approval by the FDA and the signals of efficacy that we are seeing here appear to exceed improvements demonstrated in some studies supporting improvement of medications for treatment of xerostomia. In summary, AAV-hAQP1 appears safe and well tolerated at each dose tested to date. Improvement in xerostomia symptoms and disease burden were reported using 2 different validated assessments of xerostomia, the McMaster and the xerostomia questionnaire, in 6 out of 7 of the participants reaching 90 days following treatment with AAV-hAQP1. The responses reported to date are clinically meaningful with early signs of durability. We are very encouraged by this preliminary safety and efficacy data from the ongoing Phase I AQUAx study, and we look forward to continuing the development of this potentially transformative treatment for this debilitating condition as we move forward with our Phase II study in the second half of 2022. Now I'd like to hand it over to Dr. Mike Brennan, who will provide his clinical perspective as the investigator who has treated many of the participants in our AQUAx study.

Good morning. I'm Dr. Mike Brennan from Atrium Health Carolinas Medical Center in Charlotte, North Carolina, and I'm the lead investigator for Meira's AQUAx study. Today, I'm going to speak about my experience caring for patients with grade 2 and 3 xerostomia, administering AAV-hAQP1 to patients in the AQUAx study as well as my patients experience receiving the therapy and the responses to treatment. As someone who has taken care of patients with xerostomia for many years, one of the most frustrating things is the extremely limited set of options available for their treatment. The current mainstay of therapy is a class of prescription medications known as sialagogues, specifically cevimeline and pilocarpine, which are the 2 medications approved for treatment of dry mouth. I prescribed these drugs for hundreds of patients. And while they can improve symptoms in some, major drawbacks are their very limited duration of action and the many side effects that come with stimulating the entire parasympathetic nervous system. Flushing, upset stomach and sweating are the most frequent side effects that limit the use of these medications. Many patients stop these medications because they cannot tolerate the side effects. Additionally, these medications don't change the fundamental functional capabilities of the gland to produce saliva. So the more damage a patient has, the less effective they will be. Importantly, these medications do nothing to restore the function of the salivary gland. In summary, these patients are in desperate need of a new solution to their chronic disease and my oral medicine colleagues and I have not seen a new drug approved for the treatment of patients with xerostomia in about 20 years. Gene therapy with AAV-hAQP1 offers the promise of a durable disease-modifying restorative therapy for patients with grade 2 and 3 radiation-induced xerostomia. Gene therapy for radiation-induced xerostomia is a very different treatment paradigm from that employed in the past and that involves delivering the vector directly to the salivary gland to affect functional restoration. Importantly, the clinical skills required to deliver AAV-hAQP1 are relatively routine for oral medicine specialists and oral maxillofacial and ENT surgeons. The procedure of infusing the vector is straightforward and noninvasive. It includes the intraoral insertion of a very small catheter into the main duct of the parotid gland and then infusion of the vector through the catheter directly into the gland. My patients have tolerated the procedure very well. And to date, there have been no serious adverse events reported. To date, I have treated 9 patients with AAV-hAQP1. Among the patients I've treated so far, most report a positive change within several months of treatment with continued and sustained improvement subsequently. Importantly, all changes that my patients have reported have been positive with none reporting that their dry mouth is worse or reporting side effects related to the treatment. A number of the responses are more dramatic and impressive than anything I've seen in my career. Patients describe life-changing improvements such as being able to enjoy their favorite foods for the first time in years, sleeping comfortably through the night and getting back into social situations they have shun. Interestingly, we have also noted that some of the patients have been able to start being more active and exercising again. For example, I have recently seen the first patient I treated in this trial for his 2-year follow-up. This is a patient who has been affected by xerostomia for over 10 years. Consistent with his year 1 evaluation following AAV-hAQP1 treatment, this patient continues to describe complete resolution of the symptoms with a disease burden score of 0 on the symptom-specific xerostomia questionnaire. In the context of a debilitating disease that has no adequate therapeutic options, the potential of a durable disease-altering treatment would be nothing short of a game changer. With the preliminary responses that I've seen in this first AAV-hAQP1 dose-escalation study, I'm excited to see a potential treatment for so many of my patients. I would now like to send it back to Zandy. Thank you.

Thank you, Dr. Brennan. In summary, radiation-induced xerostomia is a serious debilitating condition with a severe impact on health and daily living. There's a large unmet need with over 170,000 grade 2 and grade 3 xerostomia patients in the U.S. currently and 5,000 to 10,000 new patients annually. These patients have been effectively treated for head and neck cancer and are in regular care of physicians. There are no effective treatments available for their xerostomia and no competition in this area that we are aware of. So this is a very large market for a gene therapy product as well as having a significant annual population of patients. AAV-hAQP1 is administered as a small local onetime dose with easy noninvasive delivery. In the AQUAx study, AAV-hAQP1 appears safe and well tolerated at all doses tested. We see preliminary signals of efficacy using 2 validated patient-reported outcome assessments of xerostomia symptoms, endpoints that have previously supported FDA approval. Response rate and effect size following treatment in the AQUAx study are clinically meaningful and compare favorably with already approved drugs for the treatment of other forms of xerostomia, such as cevimeline. Based on the safety and efficacy data from our Phase I program, we look forward to initiating a double-blind, placebo-controlled, multi-dose clinical study of AAV-hAQP1 in the second half of 2022. We're very excited to see the preliminary safety and efficacy data from the aquaporin-X study and to move AAV-hAQP1 forward through clinical development with its potential to provide a onetime treatment for this severely debilitating disease that may have a significant and durable impact on patients' lives. With that, I'll open the call up to questions.

At this time, we'll begin conducting our question-and-answer session. [Operator Instructions] Great. So the first question comes from Geulah Livshits at Chardan.

Congrats on the data. A couple of quick ones on my end. Firstly, can you elaborate a little bit on what you hope to learn from the bilateral cohorts beyond what you've seen in the signals thus far? And then after that, I believe this study had also been collecting some data on salivary output. And I think some improvements on that front were reported last year. Can you comment on the degree of benefit there?

Yes. Thank you, Geulah. So one of the things that we're looking for in the bilateral treatment is a greater understanding of the effect size of what the actual treatment in patients will be. So the current study that we've reported only treats one gland and was a safety study. And in that particular study, we collected saliva using these little cups, an unvalidated method for using these tiny cups that you put over the end of the salivary duct. And this was a very problematic and unreliable way of collecting saliva because the cups fall off, they're on for different durations. It did not give reliable actual saliva volumes. The way that you get saliva volumes in general in xerostomia studies is whole saliva, you spit into a tube. So we are doing a bilateral study to get a better idea of what will happen in a Phase II with respect to efficacy. We want to treat bilaterally because we want all of the gland material that's available that is subsequently -- is available after you've got damage from radiation to actually receive aquaporin-1, and then we will collect saliva from the mouth as whole saliva as is usually done in xerostomia studies. We did collect saliva in -- as much as we could in this current study, and we did see improvements in saliva volume in those patients that responded. Does that answer your question? There were 2 related questions actually.

Yes, exactly. Yes. And then just one last one regarding the patient baseline characteristics and potential enrollment criteria. So you mentioned that one patient that didn't seem to see benefit had 0 saliva production at baseline. Is that something that can be incorporated to adjust enrollment criteria in the Phase II study?

Absolutely. That is exactly. So that will be incorporated. You can't have patients with -- it appears that you can't have patients with very, very, very low saliva.

The next question comes from Chris Raymond at Piper Sandler.

Congrats on the data. Just a couple, I guess, from us. So I guess, first, on the safety, you guys noted no DLTs or SAEs, but can you maybe talk about the most common AEs that you've seen to date? And anything that you guys are looking out for as you -- with some of these higher dose cohorts, that would be great. And then maybe a question on the market, yes, I see that you guys are saying that the incident population in the U.S. is 5,000 to 10,000, I think that you might have had a different number the last time you guys were describing this market. Maybe just talk a little bit about what kind of work is going on right now to refine that and some of the puts and takes that you're seeing in that estimation?

Okay. First of all, on safety, I'm sorry, I don't have the AEs in front of me, but this was extremely safe. This isn't something where we saw any particular safety as far as I'm aware. I just don't have the whole list of AEs in front of me. But there was no SAE, there was nothing alarming. There was no dose-limiting anything. So I'm sure we'll put them eventually in the publication. This is preliminary data. So on to the market and that the number 170,000 comes from our FDA discussions around the orphan status that we have. Obviously, it needs to be under 200 to get orphan status. So there's -- in that document, there's a discussion of how many patients are out x number of years from treatment? How many patients have the different levels of symptoms that have been persistent. So that's where the 170,000 comes from. The 5,000 to 10,000 is a ballpark estimate of the percentages of patients, we've told you the percentages of the annual head and neck cancer patients that would using those same metrics come to 2 years post-treatment each year. So those -- that's how we calculate those numbers.

Okay. Got it. And then maybe just a follow-up. So just -- you have a lot of evaluations going on with this Phase I. And I know you guys are talking about the next big event, obviously, moving into Phase II in the second half. Can you -- is there any way to put maybe some brackets around the timing and what we should be expecting between now and the Phase II initiation, just given all the additional evaluation that's happening?

So this is obviously preliminary data. We've completed enrollment of the dose-escalation phase, where we've decided to treat with the bilateral treatment. That's ongoing now. And by the end of this week, we'll have completed the first 2 cohorts. So hopefully, in the coming month or so, we will be able to totally shut enrollment and close the data. We'll then have 12-month data, right, at this time next year from this current Phase I study. But between now and then, we will be manufacturing the material and preparing for the initiation of a Phase II, which may easily come before the final data in that Phase I.

The next question comes from David Hoang at SMBC.

Congrats on the data. So a few for me. I was just wondering in terms of -- from the clinician perspective post-treatment, if you were to visually inspect the oral cavity, is there any way to kind of see any, I guess, macro differences or changes of post-treatment, maybe compared to the patient's baseline or [indiscernible]?

I will pass that over to Dr. Brennan as I believe that in some of the patients, he was able to see a difference. So Dr. Brennan, if you can comment on the difference that you as a physician see in your patients, that would be great.

Yes, certainly. So some of the things that we're seeing is you can see more moistness in the oral cavity. So you could look at the wetness of the mucosa, and you can actually see differences with the patient. So that's really one of the main things that you can tell. And it's -- patients have -- they report that the quality of their saliva is improving too. I mean, we measure the flows of -- as far as how the saliva is doing. But people actually report that the quality of their saliva feels better too. So there's a lot of things, really positive things that are happening with these patients.

That's really helpful. I also had a question on, I guess, expectations as we think about the bilaterally dosed cohorts. If there is more saliva production, I guess I'm just wondering how closely does saliva correlate with improvement in symptoms. Is this sort of a linear relationship? Or was there some maybe kind of ceiling to the symptom improvement?

So if I can just take that -- we go back to what xerostomia actually is. So xerostomia is the symptoms of dry mouth, which result in these somewhat devastating problems like loss of teeth and pain and all of those things. Now clearly, xerostomia is a consequence of having less saliva. However, even the definition of xerostomia is not completely linked to an actual amount of saliva. So saliva volume is not a supposed biomarker for xerostomia because every patient has a different volume of saliva that results in a dry mouth. Now that can be influenced by the size of someone's oral cavity, the absorption from their mucosa, the way they breathe, the amount of exercise they do, the speed of their breathing, right? So while increased amount of saliva reduces xerostomia, there is no actual volume that across all patients changes xerostomia by a particular score level. Now xerostomia can be defined as below a certain amount of saliva per minute, whatever that may be, or it can be defined as a halving of a patient saliva, so in a sense, you're right that is a correlation between saliva volume and xerostomia symptoms, but it's not, in any way, a linear -- a linear, I suppose, in a population, it's not a linear correlation. And one more thing about bilateral is bilateral allows us to treat all of the saliva ducts and acinar cells available in a patient with damaged glands. So you should be able to get a lot more saliva because you're treating a lot more glandular tissue. In some patients, both glands will have very little tissue. But maybe in other patients, there'll be an imbalance, and you'll have a large difference between the 2, right?

Again, really helpful. If I may just slip in one last question. With the Phase II upcoming with the placebo-controlled design there as we talk about that. I was just wondering if we look at the natural history of each patient, over time, is there -- I guess, any -- is there ever any kind of spontaneous recovery of gland function? Or do the patients maybe become more accustomed to their baseline, so to speak, and so have the potential to report improvements in symptoms? Just trying to think about kind of expectations for 0 response.

I'll give an answer, and then I'll ask Dr. Brennan to comment as well. So as we've stated, these patients have grade 2 or grade 3 xerostomia that's persistent for 2 or more years post radiation treatment. Every -- let's just say most people, once they're treated with radiation for head and neck cancer have xerostomia. And 60 or so percent of them recover sufficient salivary function in the subsequent 2 years to be able to not have grade 2 or grade 3 xerostomia. Some patients, a very small number have grade 4. So they have no production of saliva, they've completely fibrosed glands. But the grade 2 and grade 3 patients are those patients who have been stable for 2 or more years and have not been able to get better than that. Over time, xerostomia tends to get worse, incrementally worse with age. So this -- the natural history of this condition is not to have improvements over time. And in this study, we didn't just have patients 2 years post xerostomia, we have patients, 2, 5, 10 years post their treatment. And in fact, I think the patient that we've mentioned, who's out 2 years, one of Dr. Brennan's patients, had grade 2, 3 xerostomia for 10 years and then was treated. So it doesn't seem to be a condition where you get spontaneous response or get used to it in a way that you no longer have symptoms reportable. So Dr. Brennan, can you comment on your experience with your patients, you've treated many, many of these.

Yes, so absolutely. So what -- let me go back to the -- we -- I run a large NIH-funded perspective study of cohort of head and neck cancer patients treated with radiation. And what we found from the data is that we have baseline salivary flow measures. And at 6 months, you're at 40% of the baseline, and you get a little bit of recovery by 18 months, 60% of baseline, but it doesn't go back from this study and also from other studies, it doesn't go back to -- it doesn't go back to 100% of where you started. So that continues on. And we also sent out as far as that same cohort. It's about 570 patients. And 75% at 4 years still have a report xerostomia. And it's their main symptom that they're reporting by at least -- the next closest symptom was about almost like 35% of patients reporting a symptom. So it's the highest reported symptom. And so patients continue on the ones that -- I see patients in the oral medicine practice that -- and I might see them every 5 year or at -- after 5 years, I'm seeing them maybe once a year just to deal with some of the oral complications of their radiation. And it continues on. The dryness continues on. And we try -- we'll try certain products, and it just kind of stays on the status quo, and that's pretty common as far as in this patient population.

The next question comes from Gena Wang of Barclays.

I have 2 questions regarding Phase II trial design and then one question regarding market opportunity. So for the Phase II trial design, first, like, how do you assess baseline residual parotid gland to have a controlled patient baseline characteristics? And the second question is, you will have 2 active doses. I assume those will be bilateral 2 active doses. What kind of a score improvement you will be looking for, for xerostomia questionnaire and also McMaster global rate to select these 2 doses? And then my last question is regarding the market opportunity. This is more like regarding to the pricing. So we know gene therapy usually can charge like 3 to 5 years of cost of standard care. So any benchmark you can provide for annual cost for standard care or cost of living?

Okay. Thank you, Gena. I'll first go to the Phase II study design. We're designing this study to be placebo-controlled and to have 2 active doses. You're right, both parotid glands will be treated. So it will be bilateral. And it will be double-blind and randomized. The endpoints are the endpoints that are used by the FDA for approval. So we will be having a primary endpoint, will be the McMaster. A secondary will be xerostomia questionnaire, and then we'll have exploratory endpoints, which includes saliva collection. Saliva will be collected in the standard method that is used in xerostomia studies, which is whole saliva. So the patients spit into a tube for a 5-minute period of time, and that saliva volume is weighed. I will say that saliva volume is a good exploratory endpoint. However, it is not something that's likely to be acceptable by the regulatory agencies as it's not a validated biomarker and it's clinical meaningfulness of a particular amount of saliva is not -- has not been validated. The validated endpoints in xerostomia are McMaster and Xerostomia Questionnaire. For the McMaster, if you look at cevimeline, that was the last drug approved, this was approved based on a difference between placebo and treated groups in step one of the McMaster questionnaire. That is patients are asked, are you better, worse or the same? And for approval, what was required is more patients in the treated arm said they were better than in the untreated arm. And there's no effect size required for improvement. Now if you look at -- so everyone could have answered, one on Part 2, which is there's a small improvement, but it may not necessarily be important. The McMaster second step is a range from 1 to 7. One is it's improved, but it's not so important. And any score above 2 means that the patients have an important to extremely important change in their symptoms. Now all of the patients that we've treated in just one gland at this stage in the study, when they report positive in the McMaster and all 6 out of 7 did, they report 2 or more and some report 6 or 7. So that's a very high effect size compared to the endpoint that's been used for approval in other xerostomia studies. So we're not looking necessarily for a particular point change. In the definition of McMaster, anything above a 2 is important. And that's what the FDA wants to see. They're very focused on what is the benefit to patients and what has been demonstrated and published to be a clinically meaningful change. In the xerostomia questionnaire, the xerostomia -- generally in the xerostomia questionnaires, of that [ 80 ] point scale, a change in 6 has been determined to be clinically meaningful. As you can see, we, in 6 out of 7 had a change in that overall score of 10. So that's a good effect size with 4 of our patients having extremely big changes up to 41. So again, that endpoint is a validated endpoint in xerostomia. And in fact, cevimeline did not hit that endpoint in the pivotal studies, but it was still approved. So we will be looking at those endpoints in the same way that is done for other xerostomia studies and the data that we see today, where single glands were treated, suggest to us that the effect size we're seeing is significantly greater than the types of effects you see with already approved xerostomia drugs for other types of xerostomia indications. To answer your question, it was a bit long, Gena.

Yes. Regarding the baseline residual parotid gland, how do you assess that? And then also, how do you control the patient baseline characteristics?

Through entry criteria. So we work with physicians like Dr. Brennan. We look at the Phase I study, and we go through the entry criteria that are required for someone to come into the study.

Yes. So I'm sorry, like maybe my question wasn't clear. So how do you assess the residual parotid gland? Will you just look at the salivary gland volume? Or will you just kind of analysis to see if they still have a residual life parotid gland exists?

So the entry criteria involve the degree of xerostomia on xerostomia rating scales as well as a whole saliva. So whole saliva is collected, right? So you know people are not producing X amount of saliva, and yet they do produce an amount of saliva above the baseline. That's the same entry criteria for the current study. And we'll look at the data from this study and really make sure that we set those entry criteria to encompass the largest patient population, which we think will have the biggest response.

Follow the question Zandy like for the whole saliva, you do include other gland -- salivary gland like sublingual or the others, and those also meaningful component, like how would you identify that -- how much is actually related to parotid gland?

So number one, we're not doing a study to show that parotid glands increase saliva. We're doing a study to show that in this patient population, whatever glands are affected, when we treat the parotid, we improve xerostomia. So that's what we're showing in the study. With respect to the baseline saliva and how we collect it, this is stimulated. And stimulated saliva is largely from parotid.

Okay. That's fair. And then last question regarding pricing?

We're not going to talk about pricing specifically -- other that...

It's more like the current standard of care, like how much big cost that will be, if you can just give a benchmark. It's not like about the gene therapy price, it's just like what is cost of current standard of care annual cost and/or if we don't have a good number, what is the cost of living?

So we're currently doing a big analysis on this market and the cost not only of care because none of the drugs, as you've heard, particularly work. However, we can look at the cost of those drugs. But really, the cost to the patient in terms of dentistry and health and multiple aspects of their life. So we're currently doing that. With respect to an overall view of what one could charge potentially in this sort of market is, remember, we have -- this is a low dose, locally delivered. So it's very, very small cost of goods. So we could envisage treating and having a durable effect for 5 years to 10 years potentially, and we could charge the price of a specialty drug, for benefit in this sort of intractable disorder. And that if you look at the size of the population, that's a very large market. So we don't have to charge hundreds of thousands per dose of this. It would be charged like the cost of a drug for a 5-year to 10-year period.

The next question comes from Alec Stranahan at Bank of America.

Two for me. Maybe first on manufacturing, actually. Could you just talk about your in-house manufacturing process and what you're doing to prepare -- to produce a gene therapy for an indication with a large prevalence such as xerostomia and what you think your ultimate COGS could be in this indication? And then obviously, this doesn't seem to be a problem yet, but I'm curious on your thoughts around redosing given it is AAV-2, upfront efficacy is not enough or maybe wanes over time, or is the focus really on getting strong responses upfront maybe through the bilateral technique?

So I'll go -- okay. I'll go backwards. So I think that we've seen just with the treatment of one dose with one parotid and just obviously one patient that's got to 2 years. We've seen a maintenance of an unprecedented response in these patients in that one patient. We do expect this to be a onetime treatment. A previous study that used adeno to deliver to the salivary gland showed benefit. And I think out to 5 years, they even did a biopsy and showed expression in the salivary gland. And that was delivering with adeno. It was meant to be a 45-day study. So we really do expect this to continue to look durable. And we think that even at the lower doses or all of these doses, we're seeing benefit that is really impressive. We -- with respect to redelivery and pre-existing antibodies, this is a salivary gland, which is somewhat immune protected in that -- even with adeno, when they looked in that study with a highly immunogenic virus, there didn't seem to be a correlation between safety or a lack of response and pre-existing antibodies. So it does seem that you can deliver to the salivary gland. And it does -- it does somewhat evade already existing antibodies. Is redosing something that is possible after 5 or 10 years? Is it necessary? I don't know. But remember, we could always use an AAV5, if needed, but that's not something we're thinking about at the moment because this does look like it's something that's going to be durable. And with respect to manufacturing, you're right, we have in-house process development and manufacturing, which is both flexible enough to allow us to manufacture for all of the studies we're doing in this year and next year. And in addition, because we use a single-use philosophy, each of those suites in our manufacturing facility can immediately be scaled overnight basically from a minimum of 100 liters all the way up to 500 or 2,000 liters for 1-, 2- to 3-week batch. So we have a process that we can manufacture material that could potentially be commercial grade. It doesn't have to change for commercialization. We have our own facilities that are also scalable from clinical side batches all the way through to quite large commercial batches. So manufacturing for this commercial market is currently potentially in-house already at Meira with single-use philosophy and our scalable suites.

The next question comes from Luca Issi at RBC Capital Markets.

Great. Can you guys hear me okay?

Yes, we can.

Terrific. So I have 3 questions. One on biomarker, 2 on dosing and 3 on regulatory. So maybe on biomarker, any plan to actually show gene expression. I think that Zandy, as you mentioned, the NIH study did a core needle biopsy after gene therapy in some patients actually to show person expression. So wondering if your plans to do the same here. And maybe the second on dosing, it looks like you're dosing patients up to [ 3 E to the 12 ], which is roughly 500 times higher than I think prior study tested the NIH with AAV5. I think that trial went to [ 5.8 E to the 9 ]. So wondering if you can remind us why such a big difference in doses between this and the prior study? And then the third one, maybe on regulatory. Have you had any interactions with the FDA recently. Wondering if you can comment on whether you think the Phase II trial that you will start in the second half of 2022 can potentially be registrational?

Okay. Thank you. So we -- in the protocol, we do allow for biopsies. You can't force people to do biopsies. So yes, we do have that in our protocol, and we will, in the Phase II study as well, but that's something that people elect to do. I think 3 subjects in the NIH study did biopsies of those studies. We don't have current biopsies, but it's in our protocol. #2 is the NIH study did not use AAV. It used adeno, completely different virus, the published NIH study. So it's just the...

Great.

Okay? So it's just a completely different dosing. And with respect to regulatory interactions, we haven't had a pre-Phase II meeting with the agency about this yet. We don't have full data. And -- but we have obviously had a lot of regulatory interactions around our other programs. And we know the FDA has been clear across the board in all of our programs and interactions that the most important thing to support a BLA is to have a study that is well controlled to see controlled if possible and if not sham controlled, that has multiple doses, if it's gene therapy, and that is randomized and blinded. So we are initiating the Phase II to be designed with the patient numbers, the endpoints and the design in order to produce data that covers all of those things that the FDA wants to see in general. So this will not be defined as initially a pivotal or registrational study. However, we are designing it with the expectation that the data, if it's positive, could potentially be used to support a BLA. Would that mean we need 1 or 2 or no pivotal studies to apply for approval? We can't say until we have -- we've got the data in hand. But we're certainly taking into account everything that the FDA has spoken to us about all our other studies to make sure that we provide data that, if positive, could support a BLA.

Excellent. This concludes today's Q&A session. I'll now turn the call back to Zandy for concluding remarks.

Yes, thank you, everyone, for joining us today. We're very excited about this preliminary data in this really horrible and difficult indication. And I think it's very encouraging, and we're excited to move forward next year with a Phase II study. So thank you for joining.