REGENXBIO Inc. (RGNX) Earnings Call Transcript & Summary

Hey, everybody. Good morning. I'm Marty Auster. I'm one of the Smid Cap Biotech analysts here at Crédit Suisse. Thanks for joining us this morning at the 29th Annual Crédit Suisse Healthcare Conference. I'm pleased to be joined right now by Dr. Steve Pakola, Chief Medical Officer of REGENXBIO, who's going to kind of present REGENX story. Thank you very much for joining us this morning. Steve, good to see you. I'll hand it over to you now.

Hey, Marty, good to see as well this morning. And thanks for the opportunity for us to present. So REGENXBIO, we are a leader in AAV gene therapy treatment. You can advance to our forward-looking statements. So our company, our mission is to improve lives through the curative potential of gene therapy. And we're excited to have the opportunity to do that due to our NAV Technology Platform, which has allowed us to advance into multiple ongoing clinical step [Audio Gap] in not only our lead program in ophthalmology, RGX-314, but also neurodegenerative diseases, secondary to rare lysosomal storage diseases with additional earlier-stage programs in neuromuscular and liver indications. This NAV Technology has enabled the development of commercialized therapies and numerous gene therapies in clinical development across a range of therapeutic areas, being pursued by REGENXBIO and our partners using the AAV9, AAV8 and AAVrh10 vectors, including ZOLGENSMA. New cGMP production facility is expected to allow for production of NAV vectors that scales up to 2,000 leaders using REGENXBIO's platform suspension cell culture process. And we have an amazing team of experts in gene therapy manufacturing, preclinical and clinical development for the advancement of the internal pipeline programs. Our pipeline has advanced just this year. We have initiated 2 Phase II trials using suprachoroidal space, or SCS delivery approach, in wet AMD and diabetic retinopathy. And we broadened out our CLN2, or Batten program, to include RGX-381 for the treatment of ocular manifestations of CLN2. And you can see from this internal pipeline slide that our program is really organized into different big buckets of targets, both retinal disease in which our lead program RGX-314 for treatment of wet AMD and diabetic retinopathy as well as the new indication CLN2 ocular manifestations are included. But also these other areas where we can apply our NAV Technology with different routes of administration to hit other very big areas of unmet needs such as neurodegenerative diseases and also other systemic diseases as well. So let's dig in a little more into our internal pipeline. If we start with our lead program, RGX-314, we believe that this program has the potential to profoundly impact all aspects of clinical management for patients with wet AMD and diabetic retinopathy and could be a onetime gene therapy treatment option for a broad range of patients. We used the AAV8 vector to deliver the gene that codes for an anti-VEGF antibody fragment that is the current standard of care, turning cells into basically an anti-VEGF drug factory or biofactory and [Audio Gap] the need for repeated treatment with injected therapies. Now we are evaluating 2 approaches to deliver RGX-314, and those are shown on this slide, Slide 7. So the first approach, subretinal delivery is well-known and established as the most validated route of delivery for treatment of retinal diseases with gene therapy and that's due to the minimal exposure that you can achieve to the vitreous. So there's a much lower risk of inflammation for treatment with this route of administration. And another very strong positive for this route of administration is given the immune privileged status of the subretinal space. We can enroll patients and treat patients independent of whatever their baseline or pretty existing neutralizing antibody status may be to AAV. Now we're also quite excited about another route of administration that could broaden the optionality for treatment with RGX-314, and that's suprachoroidal delivery of 314. And this is exciting because this would give the option of an in-office surgical approach. And again, there is minimal exposure to the rest of the eye, so continued low risk of inflammation. And we are exploring the use of this approach in -- initially in patients who do not have high neutralizing antibody titers to AAV8. And that, in part, explains our enthusiasm and advancing aggressively with both of these routes of administration. So first, in terms of RGX-314 subretinal delivery, we have our ongoing study where we have administered RGX-314 subretinally to 42 patients. And we've been following these patients, and some of these patients in our earlier cohorts have progressed to beyond the 2-year time point. In the next slide, you can see the basic design here of the ascending cohort approach, typical for a first-in-human study, where we've dosed these 42 patients across 5 different dose levels. And these patients are followed at monthly intervals with assessments that allow us to look at whether we're actually getting protein expression and, importantly, whether we're seeing that translate into potential benefit for the patient in terms of noninvasive imaging of disease activity and also how well the patients are doing in terms of visual acuity. Next slide. So starting with safety. This slide gives a broad overview of what we've seen to date on long-term follow-up in these patients. Importantly, there's been no reports of clinically determined immune responses or drug-related ocular inflammation or postsurgical inflammation beyond what is expected following a routine small gauge vitrectomy. Now this is important from a patient management perspective, given that any type of sub acute or long-term inflammation would bring a lot of challenges for the patients and their caregivers and also the treating physicians in terms of potential issues such as need for ongoing corticosteroid treatment, including topical drops, for example, where you have a case where you're trading one set of issues for another in terms of potential complications and compliance. Next slide. So I mentioned the ability and what we took full advantage of in our first-in-human study was to see with gene therapy, can we actually demonstrate that we're getting protein production of our transgene product? And we have the ability to do that in ophthalmology trials by relatively noninvasive sampling of the aqueous humor, the fluid in the front of the eye to actually measure RGX-314 protein, and what you can see from the slide here is that we've clearly shown a dose-dependent increase across all 5 cohorts in level of RGX-314 protein measured. And we've seen that this has been quite durable, as you can see here with -- for all 5 cohorts where we have data out to 1 year. Next slide. This slide digs a little more into this aspect of durability, where we can see in our cohorts where we've seen the intended clinical effect Cohorts 3, 4 and 5, these happen to be the cohorts where we see very high levels of protein expression. And we see that it's quite durable over time when we look at month 1, month 6, 1 year. And in the case of Cohort 3, where we have protein measurement out to 2 year, we see rock-solid durability out to that 2-year time point. So how does that translate into what matters for the patient? And first, we're going to look at really what has been the biggest unmet need and what's really been a driving force in the field in terms of how can we advance care of patients with wet AMD and other VEGF-driven retinopathies. And that is the significant treatment burden that these patients undergo, given current treatments that require very frequent anti-VEGF injections. So in this slide, if you first focus on the gray bar, this represents the average number of injections that these patients received in the year prior to receiving RGX-314. And you can see that this is a very anti-VEGF needy population in that these patients need a lot of injections, and they still have evidence of disease even with these frequent injections. If you next look at the light blue bar, this shows the annualized injection rate based on the year of follow-up after the patients received RGX-314. And you can see that in Cohorts 1 and even 2, where we saw very little protein expression level, not surprisingly in early cohorts within a dose-ranging initial study, we see that these patients continue to need very frequent injections. But this all changes when we advance to Cohorts 3 onward where based on 1-year follow-up, we see that there's a dramatic reduction in the patient's annualized anti-VEGF injection rate in the year after treatment compared to the year before their onetime RGX-314 treatment. And again, taking advantage of the longer follow-up that we have for Cohort 3, we see this decreased treatment burden is very durable, extending out to the 2-year time point, the end of the main study duration for this initial study. If we go to the next slide, another way we like to present this data is in a typical swimmers lane plot where you have the opportunity to look at each individual patient's treatment burden. So each of these lines represents the individual patient in each of these cohorts. And each of these filled in dots represent visits where the patient actually received or needed an anti-VEGF injection. And if you look at the left side of the figure, to the left of RGX-314, you get a very nice visual snapshot of how many anti-VEGF injections these patients -- these chronic wet AMD patients are needing. And as we look to the right, and again, we're focused here on Cohorts 3, 4 and 5, where we've seen a clinical effect in terms of our different measures, we see that there's quite a dramatic decrease in the number of anti-VEGF injections these patients are needing, ranging anywhere from 60% to 85% reduction in treatment burden with also a sizable number of patients needing absolutely no injection. Next slide. So next, let's look at how the patients have done functionally and anatomically since the goal is to reduce the treatment burden for these patients while at least maintaining the control of their underlying disease. And that means at least being able to maintain their visual acuity and at least be able to maintain the health of their retina in terms of how much edema or thickness exists there. So first, let's look at visual acuity for these patients. And what you see on this slide is our Cohort 3 patients that have actually been anti-VEGF injection free for at least 9 months, out to our 2-year time point. And one reason we like to show this kind of the data is it gets rid of any potential confounding influence of any rescue injections that patients may have needed. And what you can see here is that in these patients who have not needed anti-VEGF injections for a long time, even without any supplemental anti-VEGF injections, they're able to maintain stable anatomy as measured by central retinal thickness and actually show an improvement in visual acuity of almost 3 lines of vision in Cohort 3 with a gain of 14 letters. Moving on to the next slide. If we look at mean BCVA over 1 year in Cohorts 3 through 5, you can see the positive increase in visual acuity that we achieve for Cohort 3, and we see stable visual acuity for Cohorts 4 and 5. And one key point here is, although we were certainly encouraged to see Cohort 3 that we have an improvement in visual acuity, keep in mind, these are chronic wet AMD patients where coming into the study, they'd already gotten pretty much maxed out on anti-VEGF therapy. So the real goal is to maintain visual acuity while being able to decrease treatment burden. If we go to the next slide. Here, we show the visual acuity in patients in Cohorts 3 through 5 who have not needed anti-VEGF injections over 1 year after administration of RGX-314. So very similar to what we showed for Cohort 3 earlier. And we can see here again that we see a favorable finding in these patients where we're able to have at least maintenance to improve visual acuity even without the need for rescue or supplemental anti-VEGF injection. The other piece of the puzzle is anatomy that retina specialists follow in terms of thinking of retreatment, along with how patients are doing in terms of acuity. And here again, we see what we were hoping to see and what's really part of our target product profile, which is at least being able to maintain stability of anatomy for these patients while dramatically reducing treatment burden. So we can see all 3 cohorts have a nice anatomic response. Cohort 3 demonstrates stability of retinal thickness and Cohorts 4 and 5 demonstrate an improvement of retinal thickness over 1 year from baseline. And it's again, important to remember that these visual acuity and retinal thickness changes are in the backdrop of a reduction in anti-VEGF treatment burden across these 3 treatment group cohorts. So based on the totality of this data and the durability of the findings that we've seen, we're excited to continue to guide that we'll be initiating our pivotal program for subretinal delivery of RGX-314 in the near future in the first quarter of 2021. So in September, moving on to suprachoroidal delivery of RGX-314, we were excited to announce the dosing of the very first patient in our AAV8 study, which is evaluating RGX-314 suprachoroidal delivery for treatment of patients with wet AMD. The initiation of this trial is an important milestone for our company and really as well the field in general, since this was the first ever delivery of a gene therapy to the suprachoroidal space in a clinical setting. And so we're excited about the potential of targeted in-office suprachoroidal delivery, which may provide additional RGX-314 delivery options for patients beyond subretinal delivery. In the next slide, you'll see the basic design of the study, which is an active control arm for evaluation of this onetime administration of RGX-314. Importantly, patients in this trial will not receive prophylactic immunosuppressive corticosteroid therapy before or after RGX-314 treatment. And to date, RGX-314 in this trial has been well tolerated, including no evidence of inflammation. And we remain on track to complete enrollment of the first cohort by the end of 2020 and report initial safety data from the first cohort in early 2021. Based on the data from our wet AMD study and preclinical work, we also believe that onetime suprachoroidal delivery can be a treatment option for patients with diabetic retinopathy. Sustainable long-term anti-VEGF delivery may reduce severity of diabetic retinopathy and prevent vision-threatening complications, such as diabetic macular edema and proliferative diabetic retinopathy that lead to blindness in these patients. DR is the leading cause of blindness in the working-age population and affects approximately 8 million people in the U.S. alone. Most patients with nonproliferative diabetic retinopathy often go on treated. And the current standard of care is actually just watchful waiting until vision becomes threatened. And the reason for this is that although we know anti-VEGF treatments like Lucentis and Eylea can actually regress diabetic retinopathy and prevent development of vision-threatening complications, this form of repeated injections into the eye indefinitely, we're seeing is just simply not sustainable or really even something that most clinicians and their patients are interested in starting. However, the ability of a onetime in-office treatment option that could address the underlying disease is something that we believe would really make a difference in terms of being able to address this unmet need. So the reason for this is that we know as the disease progresses from nonproliferative DR in which patients are often asymptomatic to proliferative DR, these patients have a clear increased risk of going blind from the complications of diabetic retinopathy. Importantly, we have a very well-validated noninvasive way of measuring diabetic retinopathy severity and correlating that to risk for patients. And we also know that looking at advancement or improvement on the scale and particularly 2-step improvement on DRSS is an accepted primary endpoint, and there is a clear precedent for use of this as an endpoint with regulators, for example, with the approval or label expansion for treatment of DR for Eylea and Lucentis. So our initial Phase II trial for suprachoroidal delivery for treatment of DR is the ALTITUDE study, and you see the basic design shown on this slide. This trial, we also were excited to begin -- activate this study, and we look to begin enrolling patients by the end of this year. The next slide shows the basic design of this trial, where we will enroll 40 patients with DR across 2 dose cohorts. Patients will be randomized to receive RGX-314, suprachoroidal delivery [Audio Gap] observational control. And again, we expect to begin dosing across leading U.S. retina centers by the end of this year. And we plan to report interim data from this trial in 2021. So building upon our understanding of gene therapy in the eye, we are bringing forward a new program, RGX-381 for the treatment of ocular manifestations of CLN2, a rare disease also known as Batten disease. We've been working on gene therapy approaches for CNS manifestations of this disease. But as we've worked closely with the community and gotten to know many of the patients and families, we've really been struck by the tremendous unmet need for therapies to address ocular manifestation of the disease as we know that these patients are inexorably going blind over time. Now RGX-381 is designed to use the AAV9 vector to deliver tripeptidyl peptidase 1, or TPP1, gene directly to the retina. We believe onetime administration of RGX-381 could provide a durable source of TPP1 activity in the retina, thereby potentially preventing visual decline. We plan to submit an IND for this program before the end of the year and initiate enrollment in the first half of 2021. We continue to advance the programs in our neurodegenerative disease franchise as well with gene therapies for the treatment of MPS II, MPS I and CNS manifestations of CLN2 disease. Each of these programs uses the AAV9 vector, and we are using the intracisternal pathway to deliver them to the CNS. Currently, we are conducting a Phase I/II trial for RGX-121 for the treatment of MPS II. And we're looking forward to building on a lot of the data that we've already presented, where we've shown clear proof-of-concept in terms of biomarker measurement in the CSF and also available data in terms of neurocognitive endpoints within this trial. For example, if we go to the next slide, in September, we announced the expansion of the RGX-121 program for the treatment of MPS II, including an amendment for our ongoing Phase I/II study to allow for additional patients in an expanded Cohort 2 and we recently announced that we've already dosed 2 more children in this cohort, which will provide us with additional data. We so far provided early data from the first dose level Cohort 1, which was well tolerated and demonstrated consistent and sustained reduction in heparan sulfate in the CSF. Additionally, early [Audio Gap] stability were observed. We anticipate further updates from this trial by the end of 2020. We also recently announced our plans to initiate a new observational trial designed to provide detailed characterization of neurocognitive development and key biomarkers in patients with severe MPS. We believe this study will provide critical data about the neurocognitive development of young pediatric patients with MPS II, and we look forward to sharing the data from this observational study with the patient community. Similar to the RGX-121 study, we are enrolling patients in a Phase I/II study to understand the effects of RGX-111 based on biomarkers and neurocognitive evaluations. This is a look at our study design of the Phase I/II study that is open for enrollment, which is evaluating 2 dose levels similar to those in the RGX-121 study. Separately, we have already reported data from a patient with severe MPS I who was dosed intracisternally under a single patient investigator-initiated IND at CHOC Children's Hospital. At week 12 after administration, an increase in IDUA enzyme activity was detected as was a sustained decrease in heparan sulfate in the CSF. In addition, neurocognitive evaluations indicated that the patient continued to acquire neurocognitive development skills at a normal rate at week 32. So now that we've reviewed our internal pipeline, let's take a step back and look at our NAV Technology Platform, which is really the basis of our company and what we've been able to achieve to date. One important aspect is the CMC and production side for gene therapy in general and AAV production. And here, we, as a company, are quite thrilled with the advances that we've made and really the deep in-house knowledge of AAV production and manufacturing, which provides us the ability to scale production of our gene therapies while ensuring, of course, quality for patients. We continue to maintain a strong network of well-known CMOs, and we are building on our own production facilities at our current headquarters in Rockville, Maryland. This facility, we expect to be operational in 2021, and this is going to provide cGMP production space at bioreactor scales up to 2,000 liters, importantly. Additionally, we've invested in innovative process development and analytical capabilities and use an established robust suspension cell culture based manufacturing process. Our NAV Technology Platform is the significant advancement over earlier generations of AAV vectors and delivering genes to cells with significant differentiating attributes. These unique benefits have been demonstrated in our clinical studies and animal models using our NAV vectors as well as third-party clinical trials and animal models using our NAV vectors. Our broad portfolio of certain fundamental AAV gene therapy patents and patent applications, including more than 100 patents and patent applications worldwide, covering our NAV vectors as well as sequences that are at least 95% identical to NAV capsid sequences. We also have composition of matter claims for AAV7, AAV9 and rh10 as well as methods for manufacture and therapeutic uses. Our NAV Technology Platform has been widely adopted, and you can see that from this slide of many of the programs that are in development or have reached commercialization across the different platforms. And this has really enabled us and our partners to develop best-in-class gene therapy candidates for a wide range of disease targets and this includes, of course, FDA-approved ZOLGENSMA. We believe that these programs further validate the versatility of NAV vectors and provide additional data that collectively drive the advancement of the AAV gene therapy space. Of course, you need more than science and a plan, you need people. And our CEO, Ken Mills, and the team have built this over the years, where we have a deep bench of very experienced drug developers that span expertise across gene therapy manufacturing, preclinical and clinical development that will help us advance our internal pipeline programs. And I'll end quickly with a glance at our financial guidance that Vit can speak to in the Q&A. But given our current cash position and the anticipated milestones going forward, you can see we're going to be -- we've been very busy, and we look forward to get even busier in 2021. So thank you, and we can open for questions.

Thank you, Steve. We're actually, I think, up on the end of time, so we'll wrap it there. But I wanted to thank you again for attending and making the presentation this morning.

Great. Thank you, Marty.

Have a great day, everyone.