REGENXBIO Inc. (RGNX) Earnings Call Transcript & Summary

Welcome, everyone. My name is Gena Wang. I'm SMID-cap biotech analyst at Barclays. It's my great pleasure to introduce our next presenting company, REGENXBIO. At the Zoom meeting with me, we have Ken Mills, Chief Executive Officer; Vit Vasista, Chief Financial Officer; and also Steve Pakola, Chief Medical Officer. With that, I will hand over to you, Ken.

Thank you, Gena, and thanks to you and your team from Barclays for hosting us today. I'm going to start off with a quick corporate overview of REGENXBIO, and then circle back with Gena for some questions-and-answer session. Starting my screen share. So my presentation this morning may include some forward-looking statements. The details behind the legal ramifications of this can be found in our SEC documents and filings. REGENXBIO is a company that's seeking to improve lives through the curative potential of gene therapy. We have multiple ongoing clinical studies using our AAV-mediated antibody delivery and focus on rare genetic diseases, including clinical studies in ophthalmology and neurodegenerative diseases, rare lysosomal storage disorders as well as earlier-stage programs in neuromuscular and liver-directed transduction indications. Our NAV Technology Platform that includes worldwide rights to over 100 AAV vectors, including AAV vectors like 8, 9 and Rh10, has enabled the development of commercialized therapies and numerous gene therapies in clinical development, notably ZOLGENSMA, the first FDA-approved gene therapy using NAV technology. The company has a new GMP facility that's expected to allow for the production of our NAV vectors at scales of up to 2,000 liters to support late-stage clinical development as well as commercialization of products. We have an amazing team, experts in gene therapy, biologics drug development and manufacturing, preclinical and clinical development for the advancement of all of our internal development programs. Now this is a look at our broad pipeline, which includes programs across therapeutic areas using our NAV technology, as I mentioned, broken down into 2 different technology categories, AAV-mediated antibody delivery for chronic diseases as well as AAV-mediated gene transfer focused on monogenic gene replacement. We've initiated 2 Phase II trials recently of RGX-314, which is our suprachoroidal route of administration for delivery of our RGX-314 pharmacological candidate. This includes approaches for indications in both wet AMD and diabetic retinopathy. Recently, we've broadened our clinical pipeline to include treatment we call RGX-381, which is for the treatment of the ocular manifestations of the CLN2 form of Batten disease. We have a very, very exciting and progressive clinical-stage pipeline, and I'm going to take you through a few high-level elements of it on the next series of slides for what's going to be coming in front of us for the remainder of this year and into 2021. Before I get to that, just a quick reminder of the NAV Technology Platform. It's a significant advancement in technology and capabilities over earlier generations of AAVs in delivering genes to cells. Our portfolio of patents includes fundamental AAV compositions, including over 100 patent and patent applications worldwide. This is a clinically validated platform that includes differentiating features like broader and novel tissue selectivity for the delivery of genes, improved manufacturability, evidence of higher and longer-term gene expression. And the pipeline of programs in development using NAV technology has been widely adopted, enabled by us in our own pipeline as well as partners who are working on best-in-class gene therapy across a wide variety of disease targets, including, as I mentioned, ZOLGENSMA, targeting spinal muscular atrophy type 1, marketed currently by Novartis in multiple geographies. We believe that these programs provide further validation of the versatility of the NAV platform and additional data that's going to collectively drive the advancement of AAV gene therapy as a field. Now I'm going to get into our pipeline programs. RGX-314 for the treatment of wet AMD is our most advanced program. It uses the AAV8 vector to deliver a gene that encodes for an anti-VEGF antibody fragment. That is the current standard of care for the treatment of wet age-related macular degeneration. But in our case, the treatment profile is a onetime treatment that turn cells in the eyes into anti-VEGF drug factories, potentially eliminating the need for repeated or chronic treatment with injected therapies. We're using 2 approaches to get gene therapy to the back of the eye to transduce cells into these factories for drug delivery. Our subretinal delivery is well known and an established route of administration clinically and commercially. Suprachoroidal delivery is a new approach for gene therapy and one that we are pioneering. It's an in-office and nonsurgical approach. We have several ongoing trials. Our most advanced was our first look at RGX-314 in the human eye, and it uses the subretinal route of administration. The data from this trial has provided us with evidence of compelling clinical profile for the treatment of wet AMD in a broad range of patients. It is generally well tolerated in patients with no inflammation. Patients in cohorts 3, 4 and 5 from this study have demonstrated stable to improved visual acuity and retinal thickness as well as meaningful reduction in anti-VEGF burden out to 1 year. We also have data from cohort 3 out to 2 years, which gives us confidence in the long-term durability of this gene therapy. We'll continue to use this data and other learnings from our first-in-human study to inform the design of a pivotal program, which we expect to initiate in the second half of this year. In September... [Technical Difficulty] In September, we announced the first patient dosed in a Phase II trial of RGX-314 delivered suprachoroidally. The initiation of this trial was an important milestone for the company as well as the field as it's the first clinical trial to evaluate the delivery of gene therapy to the suprachoroidal space. We're excited about the potential of the targeted in-office suprachoroidal approach which may provide additional RGX-314 delivery options for patients beyond subretinal delivery. Based on the work from our wet AMD studies and preclinical work, we also believe that a onetime suprachoroidal delivery of RGX-314 can be a treatment option for patients with diabetic retinopathy. Sustained long-term anti-VEGF delivery may reduce the severity of diabetic retinopathy and prevent vision-threatening complications, such as diabetic macular edema or neovascularization that can lead to blindness. As I mentioned, our pipeline has evolved into the overlap of 2 important areas of research. One has been our focus on CLN2 disease, a form of Batten disease that affects young children, normally with neurodegenerative complications. Building on our understanding of gene therapy in the eye, we're also bringing forward a new program, RGX-381 for the treatment of the ocular manifestations of CLN2. Now RGX-381 is designed to use our AAV9 vector to deliver a gene directly to the retina. Like we do in our RGX-314 programs, we believe that a onetime administration of RGX-381 could provide a durable source of retinal cells that may correct the deficiency, thereby potentially preventing visual decline in children with CLN2 disease. And we plan to submit an IND for this program in the second half of this year with enrollment to begin in a new clinical trial first half 2021. And to that end, we do continue to advance programs in our neurodegenerative disease franchise with gene therapies in development: 121 for MPS II or Hunter syndrome; RGX-111 for MPS I or Hurler syndrome; and RGX-181 for CLN2 form of Batten disease. RGX-121 is currently in a Phase I/II trial, and we've provided initial data for these patients, have expanded the program. Recently announced, we have additional data and details on this program also expected by the end of this year. Importantly, we have deep in-house knowledge of AAV production and manufacturing, which provides us with the ability to scale production of our gene therapies while ensuring high quality for patients, both the clinical and emerging commercial requirements. We maintain a strong network of contract manufacturing organizations while we're building out a new production facility in our future headquarters here in Rockville, Maryland, which will support GMP manufacturing production at bioreactor scales up to 2,000 liters. And that is all that I have for this moment.

Thank you, Ken. So I will start with the questions. Maybe start with the 314 program in wet AMD. So it seems that both subretinal pivotal initiation and the suprachoroidal AAVIATE Phase II first cohort data has some delay from like year-end '20 to first quarter next year. Just wondering what was the reason. Was that some impact from COVID-19? Or was there other reasons?

Gena, our original guidance was that these trials will be starting at the end of 2020, and we feel that we've been able to continue to hit the milestones internally that we had expected as of our last quarterly update. But we also saw a pretty change in the background of COVID-19 from the summer to this point in time, and I think we're being cautious right now about plans overall, given what may be in front of us over the next couple of months. But I think this change in guidance was meant to acknowledge that these programs are on track. It may be that they fall very early into the beginning of next year in terms of some of the literal execution versus the very end of this year, and we wanted to be transparent and conservative with shareholders and stakeholders on that.

Okay. Great. Very helpful. And regarding the suprachoroidal AAVIATE Phase II trial, wondering -- is the trial open label? It is a placebo-controlled study, but is it an open-label study?

Steve, do you want to answer that?

Sure. Great. Gena, yes, so it's inherently open label for study site members involved in the care of the patient or administering the product, for example. But importantly, it's masked for a lot of the key variables that we care about. So for example, BCVA, best corrected visual acuity, is done by a masked assessor. The CRT, the main anatomic endpoint and any other anatomic endpoint determined by a central reading center, that's masked. And even the retreatment assessment, which is based on the masked BCVA and the masked CRT, is, therefore, also done based on the masked assessments.

Okay. That's very helpful. And at the earnings call, you mentioned that no inflammation so far since the first patient dose back in September. So just wondering, were these placebo patients or were they in the drug arm?

So it was in all the patients that have been dosed to that time point, so whether placebo or active. And just to clarify, our announcing of first dose, so that was not a placebo because they were actually dosed with RGX-314. And we've moved with recruitment since then. So it's a 3:1 randomization with 15 active and 5 control arm standard of care.

Okay, okay. That's very helpful. And based on your prior experience, is it fair to say at the first quarter data update, we should see like, say, 3 months biopsy data with protein level and also, we should see the visual acuity, retinal thickness on top of the safety profile?

Look, one of the reasons we wanted to do the update in early 2021 as opposed to late 2020 is we're still definitely targeting and planning to complete recruitment this year, but then that inherently means a lot of those later patients enrolled wouldn't have very much follow-up at all. So even in early 2021, there won't be a lot of follow-ups. So really, realistically, the main focus is safety. But even from a safety standpoint, you would care about things like BCVA and CRT. So I think inherently, those you could envision as being rolled up in terms of evaluating how the patients have done early on even from a safety perspective. The protein levels is another issue because there's a certain lag of -- you get the clinical assessments right away that we can aggregate and analyze, but the protein samples just take longer in terms of doing batch analysis and the time for that.

Okay. That's very helpful. So at the AAO presentation last week, on Friday, Dr. Dante Pieramici, I hope I pronounced his last name right, he basically noted that rescue injection was conducted for your subretinal trial with basically 2 to 23 micron increase in the central retinal thickness, which is a very stringent criteria. So in your SCS Phase II study, so what -- can you elaborate your rescue injection criteria in terms of thickness and also the visual acuity? And the -- any fluid buildup?

Yes. So Dante Pieramici presented that slide which is the first quantitation of what we've been saying for quite a while, to your point, that in that trial, investigators were reinjecting or giving rescue injections for very little change or, in some cases, no change at all in the underlying anatomy. And yet, we were still seeing a dramatic reduction in treatment burden. So going forward, we've qualitatively talked about for our upcoming pivotal study and then also for this suprachoroidal delivery study, AAVIATE, that we would use more standard criteria so that it's not so easy to be giving reinjection, and therefore, we might see potentially even clear demonstration of reduced need for reinjection. So to answer your question, yes, we will have standard -- we do have standard criteria in here that the patients need to have either a significant increase in their CRT, like 75 microns over recent visits or 100 micron over baseline; and/or visual acuity decrease of kind of standard levels that you kind of see across the different studies. So just in summary, yes, very -- more typical criteria that you expect in the later-stage development.

Okay. Steve, actually, I wanted to ask you -- you mentioned 75 micron. That to me seems a little bit loose. So like what is -- I know we did see across the board different criteria. Some could be like 75, 10 letters, and then others could be 50 micron, 5 letters. So like is yours more in line with 50 micron, 5 letters or even would be more loose for the Phase II trial?

Yes. Actually, what we've seen, like if you look at the PDS history, for example, an Archway is more the 75-micron cut. I'd agree, going any more in the other direction of, say, 100 micron, that's too much of a change to be requiring from a clinician standpoint, but we've had no problem with the 75 micron and/or a certain letter decrease.