Precigen, Inc. (PGEN) Earnings Call Transcript & Summary

Good morning, everyone. Thanks for joining us for another session at the 43rd JPMorgan Healthcare Conference. I'm Brian Cheng. I'm one of the senior biotech analysts here at the firm. I'm also joined by my associate, Sean Kim and Mariam Waggeh, who are also in the audience. On stage, we have Precigen. I will now pass the mic to their CEO, Helen, for a short presentation, followed by a live audience Q&A. Helen, the stage is yours.

Thank you very much, Brian, and thank you for having us at the conference. It's great to be here today and presenting on behalf of the Precigen team. So let's get into the bulk of our presentation, and we look forward to also the discussions afterwards. I will be making some forward-looking statements. So please make sure that you read the SEC-required slide. With that in mind, I think this slide, I just want to point out to a seasoned leadership of the Precigen, which for the past 40 years, have advanced a very, very exciting portfolio forward that I will be talking about, and one of our major assets, PRGN-2012, which in a matter of 3 years, have been advanced to the rapid accelerated path, and we just submitted BLA. With that in mind, let's go through what we have really accomplished and what we are talking in regard to the Precigen and how Precigen has been advancing in the past year, especially from last year at JPMorgan. We currently have really de-risked the highest-priority asset, PRGN-2012, which will be, if approved, the first therapy for recurrent respiratory papillomatosis. And this -- the pipeline is as a result of a very differentiated gene therapy platform of the gorilla adenovirus platforms, which I will be speaking about. Mainly, this platform is really applicable to all gene therapies. But specifically, we have focused on HPV-related, the rare diseases such as RRP or in cancer diseases. We also have built the capacity and manufacturing facility, both GMP and now cGMP, to further scale up for commercial manufacturing if drug approved. And also at the very end, I will be discussing our revolutionary truly paradigm-changing UltraCAR-T, which is the only autologous overnight CAR-T that does not require a viral or antiviral platform. And it can be done at the hospitals with a much lower cost assumed and a very rapid basically manufacturing. And with -- we showed the safety and efficacy, which I will be discussing. And finally, as we have communicated lately, we have now starting the January with approximately $100 million at hand, which we believe it puts us well and after the -- hopefully, the approval of the PRGN-2012 and to commercialization well into 2026. So with that in mind, let's just start with the platform that PRGN-2012 is based on. This is our proprietary gorilla adenovirus platform, which is unlike any other adenoviral platforms that it's known, including the chimpanzees. And why do I say that? It's very simple. These gorilla adenovectors, which they transfers the genes or the epitopes of interest, they basically have a very large capacity compared to other Ad5s that they're at best around 5, you're looking at 12 kb. So you can put much more genes and epitopes in them. But more importantly from that is that you can repeat those. Why can you do that? And you cannot do that with other AdenoVerse is because the individuals humans don't have either any pre-immunity or seropositivity or very little, so you can repeat dosing this. And as a result, generate a very, very high specific CD8 responses. And we have shown that in our clinical trial, and I will show some of the data today as well. And we have repeat dosed this number of times, not 4 times, but sometimes up to 16 times in some of our other trials. And we have seen a kb enhancement of the T-cell responses. And finally, we do have the highly productive manufacturing cell line, which is, again, we have a full IP around that and our own GMP facilities that it produces the material and allows us to very rapidly move. On the left-hand side, you see the portfolio that we have built based on our gorilla adenovector platforms. Of course, our lead asset is PRGN-2012 in RRP, which I will go through more comprehensively. But we also have built the PRGN-2009, which addresses the HPV-related cancers, both in head and neck cancer, cervical cancers, which is in a Phase II clinical trials currently, and we have reported data on that at ASCO. In the checkpoint inhibitor failure patients, we were able to show 30% objective responses in this patient population, which is quite significant, and we are very excited about that. So let's go to PRGN-2012 and the treatment for recurrent respiratory papillomatosis. This slide, I think it really points out what a devastating disease this is. Recurrent, as the name, it's obvious. It's recurring benign tumors in these patients that they can be infected with HPV 6 or 11 from childhood as they pass through the birth canal or in the adult through a sexual transmission. Now the root cause of this disease is the infection of HPV 6 and 11 and leads to recurrent benign tumors developing in trachea and on vocal cords. There is no current approved therapy for this patient. These patients were diagnosed some more than half centuries ago. So this disease have been there for a long time. But -- and it's not the lack of basically investigators trying to come up with a treatment. None of the treatments have worked. And can you imagine for a patient in order to be able to breathe or speak, they have to go to recurrent surgeries? And some of our patients, and I show that per month, they had required a surgery and -- in order to be just functional or can breathe. So you can imagine what a devastating disease it is. It's a rare disease with a unmet needs. And as I mentioned, surgery is not curative here. It just basically -- it removes the tumor and the tumor comes back again and again. Unlike other surgeries that usually, surgeons are very successful by removing the -- if various tissues, this is not the case here. So I want you to keep that in mind, and this is the progression of our program at Precigen that we started the discovery in 2020 in the midst of actually COVID. In 2021, we had approved -- started our IND in March, April of '21. By the December of '21, we finished the Phase I, and we had the data on safety as well as the dose, and expanded to 12 patients at dose level 2. And as you see, in January of 2022, we started a single-arm Phase II, very similar design, exactly the same design. And in 2023, based on the data from our Phase I, the FDA actually awarded us the breakthrough designation and received the FDA accelerated approval pathway, so which was very exciting because this is the first drug product that received that from the FDA. And in 2024, we reported at ASCO at the breakthrough basically presentation, the data from the pivotal Phase I and Phase II single arms, positive significant data that met all the endpoints. And currently, as we already have communicated by the end of December of 2024, we submitted our -- and finished submission of the rolling BLA, and we are very excited and hoping to receive the PDUFA date and the approval by second half of 2025. So with that in mind, what have we -- if we look at the pivotal data, our pivotal data as was presented in a late-breaking presentation at ASCO showed significant efficacy with a very, very favorable safety, which I will take you through that. As I mentioned, we have submitted the BLA. And now our commercial organization has been put together under the leadership of Phil Tennant, which today I will have on stage with me, and really preparing for the launch in the second half of 2025 if drug is approved, and we are looking forward to that. And finally, the cGMP under the leadership of our manufacturing head, Dr. Butman and Dr. Shah, the Chief Operating Officers, that it have moved from the perspective of being just a GMP facility now to the cGMP facility that if approved, it has all the ability to scale up on a drug substance level and have done so for the commercial path. So a little bit about the mechanism of action of our gene therapy drug, PRGN-2012. This is basically a drug product that you inject subcutaneously, does not require any kind of a device or anything else. It's very easy to administer. And upon administration, it basically -- you are training the T-cells of the patient to basically train to see the HPV 6 and 11 infected cell, which is the root cause of this disease, and destroy them. And that's what you are basically building an internal army to go around in a systemic fashion and anywhere that they see these infected cells that leads to the benign tumor destroying them. The clinical trial that we started, both on a Phase I and Phase II, and the design has been exactly the same thing. It's basically the patient we brought in, the most severe patient population, which was defined as having at least 3 surgery in the prior year, prior 12 months. They came in, and because they needed a surgery for either being able to breathe or speak, they did the debulking, and then they receive 4 injection. This is a course of PRGN-2012, 4 injection over approximately 3 months. And then they were followed at their own -- by their own physicians and centers of the excellence for minimum of 12 months. And of course, we have been following them even for much longer, and it's quite interested -- interesting data on the durability. On the right-hand side, what you see is basically the patient population characteristics. And I'm not going to go through all of that, except saying the patients that, obviously, we have been treating, they have been adult patients. But you can see that more than 1/3 of these patients, they had the disease from their childhood. Can you imagine some of these patients from an age of 1, they have been requiring surgery, some of them on a monthly basis even, just to be able to breathe and what they have gone through. So safety, I think this data were presented at ASCO, very simple. There is really very favorable safety, Grade 1, Grade 2, which is basically the rash at the site of the injection, maybe a little bit of fever. And by next day, usually it resolves, and this is extremely important because the patients, it's very easy. The physicians, they describe this as getting a flu shot. That's how they look at it. Now the data, this is a combined data, patient by patient, and this is what it was presented at ASCO. As I mentioned, the FDA had agreed that the single-arm Phase I, 12 patients, plus the single-arm Phase II, 23 patients, can serve as a pivotal, and we didn't need to do a Phase III or placebo-controlled trial. Based on that, gray bars is showing you all the patients 12 months prior to joining the treatment and the number of surgeries that they require. You can see on the top part of the graph, some of these patients, they require 10 surgery, 8 surgery, practically every month requiring a surgery. And then the zeros points out to the 12-month follow-up. Our endpoint was very robust, and it was no surgery to be done, not reducing the number of surgery, but no requirement at all for surgery. And not only we have met that, but we exceeded the endpoints that we had. And we have been following these patients and some of the patients from our Phase I. They have passed more than 32 months and approximately some of them 36 months now, that they have not required any surgery whatsoever. So this is the first time that any therapeutic -- and by that, everything has been tested in these patients, including checkpoint inhibitors and they have failed, that these patients, they have not required any surgery for a very durable timelines. Now on the -- this slide, what you see is the picture of the vocal cords and trachea of some of these patients prior. And after then, of course, we have this for all of the patients. And you can see the clearance of these tumors from the throat or from the vocal cords. And this directly corresponds to the Derkay score, which measures the number of these benign tumors, that they now reduced significantly or to none, and also the voice quality index, which is very important when these tumors are developing on the top of a vocal cord. And on the right-hand side, the blue dots that you see, it's from the responder patients. And these are the patients that now you can see they have developed a very significant immune response, which goes to the root cause of this disease, which is the clearance of the infection in the tissue and not allowing the benign tumors to reoccur. And from -- as I mentioned, we see PRGN-2012 as the -- to have the possibility to be the first and the best in the class, not only based on the safety efficacy data, but the ease of the administration. We have established the mechanism of action and shown that the directly response is related to that. And there is a lack of meaningful antibody -- neutralizing antibody, which is associated with other adenovirus platforms. And the reason for that is these vectors directly push toward the CD8 responses. They are quite differentiated than others. We have started our confirmatory trials, which is, again, single-arm 35 patients, exactly the same design, and this has been in agreement with the FDA, and we are currently enrolling in that. And we also, as I mentioned, we are very excited that by the end of 2024, we submitted our BLA, and we are waiting for the BLA review and acceptance and then a PDUFA date that is given. And obviously, we have asked for a rapid review, which it puts it at 6 months review period. So commercial opportunity, later on, Phil, will be speaking more to that. But one of the things that always comes out is the prevalence of RRP. And we have done the analysis, and we have shown that the prevalence of RRP is not expected to impacted by the GARDASIL for the span of drug treatments that we have for PRGN-2012. And this is based on the very detailed research analysis that we have done, and we can speak to that. And one of the other aspects that has been somewhat always different numbers has been put forward over the years. The original studies that they were done in 1990s and looking at the number of RRP patients, they pointed out some studies between 14,000 to 20,000 patients that -- in U.S. And we have done now a very detailed study that has gone to the electronic patients data. And we always -- and from what we have heard from our investigators, that the idea was that they were much higher, and these were -- the 20,000 were underestimation. And our data now shows that actually in the U.S. alone, it's 27,000 patients. And this is with a stringent criteria. And then ex U.S., we are speaking about more than 125,000 patients. And with that, this makes the -- basically the value of this drug in a multi-billion dollar globally. Now what is very important, I want to take a few minutes just to speak, it's -- what does this mean for a patient? And what does it mean for the investigators that they have been treating these patients? This is a quote from the president of a patient advocacy group. And I'm just going to read the first part, "I think about what it would be like if there is a therapeutic option. I could go to my laryngologist and get an injection. Even if I had to do that every single month, I would do that 1,000 times over rather than having a surgery." Now imagine that our data on the efficacy side, in a span of 90 days, you receive 4 subcu injection, and we had 51% complete responses in this patient population. On the other hand, a lot of people, they think that surgeons, they really like to do this. But one of the things we should always remember are surgeons have been trained to go in and eliminate the issue with the surgery. Their purpose is never to go in and keep going back in there. A good surgeon see themselves by curing whatever the problem is. And unfortunately, in this disease, that is not the case. And this is a quote from one of those surgeons, "Nobody wants to operate on these patients over and over again, because that leads to further scarring, complication and risks." And nobody wants to do that, and you can imagine the patients don't want to go through that, and that's the importance of this drug for this patient population. And with the PRGN patient drug product that we have, the profile, the safety, ease of administration, efficacy of 51% response and having no treatment, of course, you can see the possibility of this drug product for this patient population. GMP readiness. We have our own cGMP facility, and this is very important because that has allowed us not only to produce the material for our clinical trials for our confirmatory trials, but also has allowed now for -- to be ready for commercialization and scale up at the DS level if drug approved. And finally, I'm going to take the last few minutes before we go to the question, talk about the other side of Precigen and cell therapy, basically platform that we refer to as an UltraCAR. Our UltraCAR truly is the overnight autologous CAR-T that you can produce -- the basically, they take the T-cells from the patient overnight and put in a CAR-T plus a switch that in the case that you want to eliminate T-cells, you can activate that switch and a membrane-bound IL-15 that continues the manufacturing directly within the body of the patient and allows these cells to persist and grow when they need to, and they just survive when there is no antigen around. This process that you see, this happens in the hospital and has been done at Moffitt Cancer Center, Mayo Clinic, Fred Hutch, and also University of Washington. And what you see is the patient's basically T-cells, they come in, they're freezed, frozen. And when they need, they basically take that. You can now, in a nonviral way, using Ultra plasmids, transfect by using the UltraPorator, which we have developed this device, is a semi-closed system that, under 12 minutes, you can transfect 4 billion T-cell. This is important for scalability, but also generate autologous CAR-Ts now. The next day that are not activated, they are not exhausted, it's QC-ed at the hospital and reinfused back to the patient. This is not fast CAR. This is not possibly overnight CAR that some other companies have been referring to. This is truly the only platform that allows you to do that. And why is this important? Brings down the manufacturing cost because there is no lentivirus. You can repeat dose. You can do this at the hospital, so the turnaround time to the patient is truly overnight. And no other system allows you to do that. And if patients need, and it includes a safety mechanism. And now in the next generations, we have even mechanism that down regulates the checkpoint inhibitor in the CAR itself, which reduce the cost further down and also the, say, toxicity. And this is truly paradigm shifting. And we are very excited about that. This is the portfolio of our CAR-T that both in hematological as well as the solid tumors have been advancing at various sites. And August of 2024, we -- because we were pushing and we continue to push our PRGN-2012, we pared our portfolio, but we finished the most advanced through the Phase Ib for AML. And we have decided and have communicated that the best way moving forward for this part is through strategic partnerships, which we are currently in discussions. So with that in mind, let's just take a few minutes on our AML. This AML, it's UltraCAR-T that focuses on a CD33 plus having a safety switch and a membrane-bound IL-15 in an AML patient Stage IV that they really have known. The Moffitt Cancer Center pioneered, they started with this, and then Mayo as well as the Fred Hutch and they have joined this, so it's a multi-central. And the first set of data from a Phase I was reported by Dr. Sallman at ASH. Very exciting data, 28% complete responses in a patient population that they have few months to live. But since then, we also have analyzed further our data and the expansion data that we have. And this is the first time that we are showing this data. The translational group have identified specific biomarkers that you can stratify the patient population upfront and now drive that efficacy portion to a much higher percentage. What you see in that green bars, these are responders, and they are showing a specific biomarker B versus the nonresponder, which is the red. And now you can basically, with simply as the patients come in and looking at the test of the blood test that we have, identify and we can identify the patients that are going to benefit with that characteristic. And can you imagine transferring that 28%, doubling or tripling the efficacy? And this is what we are in preparation now after submission of our BLA for PRGN-2012 to go to the end of Phase Ib, meeting with the FDA and the discussion for a pivotal strategy, hopefully, for approval. So again, I think I'm not going to repeat all of this, but we believe our UltraCAR is a paradigm shifting, which is truly overnight, has a much lower cost associated with it because it doesn't use a lentivirus has -- can address all the safety, has a favorable safety. We have never seen a neurotoxicity, no DLTs in these patients. And with a much lower actually concentration of cells, you can achieve objective responses. And going into autoimmune disease, and we have shown this data at SITC now, that actually, we believe has the possibility to be the best first and the best in the class in that setting. So with that, I'm going to thank all of you and thank Brian and JPMorgan for having us here, and we go to the question and answer. Thank you.

Great. We're going to start the Q&A. Maybe, Helen, it will be great to maybe just kind of maybe anchor on just the upcoming potential. I mean, there's a regulatory timeline to the BLA that you filed for 2012. Just can you walk us through how the review process and the time line towards your first potential BLA approval?

Yes, absolutely. So as mentioned, we have -- we submitted our BLA by end of December. We have received the -- basically from FDA that they are in possession of this BLA. And the process of their review, which is for 60 days, has started. Upon the 60 days review, the FDA then officially gives you the basically BLA acceptance and a PDUFA date for possible approval. And we are looking at the second half of 2025 for start the commercial launch, hopefully, after receiving the approval.

And can you talk about just how the ongoing enrollment has been in the confirmatory trial? And as we think about the requirement of the confirmatory trial, is it required to finish -- do you need to finish enrollment first for the approval?

Yes. No, absolutely. Great question. So we started our confirmatory trial that based on the alignment with the FDA. It's exactly a single arm with 35 patients exactly, as we have done in our Phase I, Phase II, with no placebo requirement and arm, and this started already in the third quarter. And we have currently enrolling patients to the confirmatory trial in a number of sites. And what is also very important to understand, when you have the basically breakthrough and rapid approval path, FDA only requires that you start the confirmatory trial. You can receive your approval without finishing the enrollment or the data readouts, and I think that's very important because it's just the initiation of confirmatory trial that we have done so already. And basically, different sites are in the process.

Okay. And how are you thinking about the potential BLA label could look like? I guess, what kind of language do you expect to see? Because there is a spectrum of patients that require surgeries a lot. So how do we think about just the requirement from a label standing on that point? And then also, is -- as you pointed out, your -- you had experience in a relatively wide range of age, right? And I think you pointed out one -- there's someone at the age of 1. So how should we think about just the language around age as well?

Absolutely. So currently, the label would be for adult RRP patients, and that's covering all RRP patients. And the reason for that is, obviously, we have run our trials and we have basically recruited the most severe patient population. And that was done on design because if you can achieve the results that we have achieved on a more severe patient population, it is logical to basically assume that with the less severity, the patients would respond. And why would we say that all RRP patients, adult RRP patients at this point? And the reason for that is we're investigators. And the surgeons that they treat these patients, they are of the belief, and these data have been shown that, as the patient, they start the surgery, the surgery is not curative. And as a result, it doesn't lead to the cure. So this patient, after the first surgery, they're going to require more and more surgeries. And these surgeries are damaging and highly risked -- sort of provide a high risk for these patients, so the surgeons don't want to do that. And when you talk to them, they -- and actually, one of the investigators was asked this question, and they said, "Who would you give this to?" and they said, "Anyone who has RRP." So the label that we are seeking is, of course, for the treatment of RRP patients in, we believe, in adults. Of course, there are plans for a pediatric in the later as we achieve the commercialization of the adult therapeutic part. And I think that also would be very beneficial to go to the patients that are below age of 18.

Maybe just turning to commercial. I think just going on the same point is that the label could be broad, but have you had any engagement with payers to get a sense of how they're thinking about what the bar is in terms of patient characteristics? And yes, maybe let's start with that point.

Yes. And we have had that, and I think best would be I give that to Phil, the Chief Commercial Officer of Precigen, to answer that based on the studies that has been done.

Yes. We've had extensive interactions with payers, and we continue to do so as we get towards launch. We've covered the disease, the unmet need. They -- there's a few things that have come through those discussions. Firstly, they recognize the high unmet need here. They recognize the inappropriateness of surgery to deal with this chronic infection in the long term. And in terms of discussing the value of our medicine and the innovation that it delivers, we've used that as the anchor point for discussions on price and value. We can expect there to be prior authorization when we launch, and that could be a mixture of trial, inclusion/exclusion criteria, treat to label, and an extreme medical exception. Now at the price points that we're discussing with the payers, we believe medical exception will not feature prominently, and it will be a mixture of treat to label and/or inclusion/exclusion criteria.