REGENXBIO Inc. (RGNX) Earnings Call Transcript & Summary

Good afternoon, everyone. My name is Gena Wang. I'm SMID-cap biotech analyst at Barclays. Welcome to our fifth Gene Editing and Gene Therapy Summit. It is my great pleasure to introduce our next speaker, Ken Mills, Chief Executive Officer from REGENXBIO. Ken, I will hand over to you.

Gena, thanks very much, and thanks to you and the Barclays team for inviting us to this event. We always enjoy spending time talking about REGENXBIO and things happening in the field. And a few slides that I'm going to bring up here to give a quick overview, and then I know we'll transition into a discussion-based format. I'll get my technology working. Thanks. Before I get into the background, I just want to acknowledge the forward-looking statement disclaimer here on the second slide that there may be some discussion of factors that relate to forward-looking statements on my part during this quick talk and discussion. REGENXBIO is an AAV gene therapy company that's mission is to seek to improve lives through the curative potential of gene therapy using AAV technology. Many of you know us, but just at a high level, we're advancing a really broad pipeline of different clinical stage programs using multiple different routes of administration in AAV technologies to target different tissue types and diseases. In one area, eye care, we announced just a couple of months ago, a global strategic partnership with AbbVie to commercialize gene therapy treatments that we've had in development. We're going to be excited to talk more about that. We have what we believe to be the industry-leading AAV manufacturing platform that cuts across all of our clinical programs, and even as part of the AbbVie commercial partnership is beginning to establish itself as sort of the pre-commercial platform for supporting gene therapy treatments in eye care. Our team has been involved in AAV gene therapy for -- in some cases, across multiple decades, with expertise in drug development and technical operations and manufacturing and commercialization of products. To augment that, we think we have one of the strongest teams in the space. And our manufacturing capabilities extends from the underlying technology, which is our NAV technology platform, which is technology that we licensed in from the University of Pennsylvania, the lab of Jim Wilson in the early 2000s. When the discoveries were made, we really pioneered the evaluation and use of the NAV technology in the clinic and in some cases, all the way through to commercialization, like with our partnership around the ZOLGENSMA product for spinal muscular atrophy, which is marketed by Novartis worldwide. We've ending 2021 having accomplished a tremendous number of milestones this year, including notably the AbbVie partnership advancement of our clinical development in multiple areas, including recent clinical updates on our RGX-314 programs using suprachoroidal delivery at the AAO Conference just this past week. So we're excited about what the future holds as we head into 2021. This is a quick overview of our internal pipeline. As I mentioned, we're focused on many different therapeutic areas and routes of administration. In retinal diseases, we're using subretinal and suprachoroidal delivery to focus on anti-VEGF indications as well as inherited disease indications, such as in Batten disease. And recent data against the background of these programs, we'll be talking about, I'm sure, more today because we just had some presentations as recently as last Friday. We're planning for the filing of an IND, our first in our neuromuscular disease area, which would be an intravenous administration of an AAV encoding for a truncated form of a functional microdystrophin, or Duchenne muscular dystrophy program, RGX-202 is focused on advancing that neuromuscular disease franchise, again, as kind of our first foray into that space. Our neurodegenerative disease programs are active in the clinic, 2 programs we've reported clinical data on where we, with a onetime gene therapy treatment, introduced the gene therapy into the cerebrospinal fluid of a patient in order to access the full complement of the central nervous system to get changes made in many, many different types of cells in diseases that have a somatic basis and need gene replacement. And we've reported data in our MPS II program, Hunter syndrome as well as in our MPS I program in that space. And lastly, we continue to look at liver-directed programs as an additional part of the platform overall, including a preclinical stage program looking at hereditary angioedema. The partnership with AbbVie is a recent evolution for us, one we're very excited about. We announced this back in September, but we also announced just last week that this deal has now officially closed. So the strategic partnership really combines REGENXBIO's expertise in AAV manufacturing abilities and development with AbbVie's capabilities in the development and commercialization of products in eye care overall. Details of the partnership included an upfront payment of $370 million premade to REGENXBIO before the end of the year. Additional milestones to be earned through the development and regulatory execution of RGX-314 across multiple of our programs and routes of administration. And then transitioning into the commercial phase of the partnership will be leading manufacturing of RGX-314 for both clinical development as well as commercial supply with AbbVie having responsibility for substantially ex-U.S. supply. Outside of the U.S., REGENXBIO will receive royalties on product sales. Within the U.S., we have an equal share of profits. I mentioned our manufacturing capabilities. I wanted to highlight this today because as we complete '21 and come into '22, where we'll be bringing a new full-scale capability online in our new headquarters building here in Rockville. This is based on deep knowledge of sort of process development and vector characterization in manufacturing that's been going on within REGENXBIO for years, working with a number of important suppliers end-to-end in our supply chain to support all of our clinical development to date, but bringing in a flexible large-scale GMP capacity directly into our building as a major enhancement and advancement of our capabilities. We'll be able to manufacture here in Rockville at up to 2,000 liter retail using suspension free bioreactor capabilities. We'll continue to use processes that we've already installed in our supply chain network but have additional integrated process optimization and sort of end-to-end research and development candidate selection to clinical material type time lines to shorten substantially, we believe, because of this internal end-to-end capability. We've always maintained a strong priority of analytical capability here within the company. That will continue to maintain its residence here with us. And finally, I mentioned partnership and ZOLGENSMA, but this is just another perspective about one of the chapters and the history of REGENXBIO in the future of where REGENXBIO is going in terms of the field overall. Our NAV technology really through licenses and enablement and partnership and in some cases, company formation, has really created a whole landscape of different AAV gene therapy products across a variety of different disease areas and at various stages of development. Of course, one commercial product, but also many late-stage products that are in development and new early-stage research and preclinical and even early clinical development ongoing with companies, both large cap companies as well as strong SMID-cap partners that we've entered into license agreements with over the course of the last 5 or so years. So really pleased about the progress that we've made so far this year, a lot that's been accomplished in 2021. The focus of the company is really on executing on the mission about the curative potential of gene therapy, our retinal disease programs, our GMP capabilities, our Duchenne IND and the next steps in process of milestones with our neurodegenerative programs, especially for Hunter syndrome and Hurler syndrome are major priorities for the company that are coming up in the next several months and look forward to a little bit more discussion on some of these topics, Gena. Thanks.

Thank you, Ken. Okay. Good. So perfect. So maybe the -- you presented the second cohort suprachoroidal data 314 in wet AMD over the weekend -- last Friday, actually. So I got -- I mean, to me, the data looks encouraging, that the safety looks good, certainly did not -- wasn't worsening with the inflammation rate. But I do get some pushback regarding the efficacy data. So some pushback is why we didn't see a clear dose response regarding the cohort 2 versus cohort 1? If we look at the injection fee rate, we did see some improvement, like from last time the cohort 1 was 20 -- sorry, I'm blanking out now, 29% -- yes, 29% to 40%. However, the injection burden basically almost no change, largely the same, and it's around in a 70-ish range. So maybe that's the first question I will start.

Yes, great. I appreciate the question. We've also, as you know, got Steve Pakola, our Chief Medical Officer, here as well to chime in. I'm going to start with an introduction to the fact that we -- in initiating clinical trials with respect to our suprachoroidal delivery approach, as you know, we had the ability to leverage and learn from a lot of pharmacodynamic exploration of the RGX-314 product using our subretinal delivery, which we established over multiple dose levels and many patients at different cohort levels for long periods of time, right? We have some patients out over 3 years from that original study of RGX-314 subretinally. When we initiated the suprachoroidal studies, therefore, we were able to come in at a part of the dose curve from the subretinal studies that was higher than where we started with subretinal. And so we had an understanding and an expectation that pharmacologically, RGX-314 could be active, show biological activity, safety and clinically meaningful benefit within that range. We actually moved into sort of pivotal phase of development. And so when we made that bridge over to suprachoroidal, I think that we were looking to assess whether or not we were continuing to be within that range of biological activity. And I think cohort 1 established when we reported that data just less than 1.5 months ago that we were in fact there. The move from cohort 1 to cohort 2 was the first time that we've ever done any sort of dose escalation and presentation of dose escalation with the suprachoroidal approach. First, let me just pause on one point that you just made, which is 40% of patients in cohort 2 at 6 months were injection free. That's a phenomenal outcome from my perspective. We've been working with gene therapy in the subretinal and more recently in the suprachoroidal space for a while. We've approached the opportunity space for AAV gene therapy as a onetime treatment for wet AMD and other anti-VEGF treatment option diseases. When we get to the 6-month time point and see 40% of patients who have been coming in receiving regular treatment go for that period of time without injections, we're very pleased with that outcome. We believe that it maps on nicely to the opportunity that exists for RGX-314 in wet AMD. And in addition to that, we're seeing a reduction in injection burden of over 70% at that dose level as well. So the combination of those 2 things, along with safety profile that we feel comfortable about as well tolerated and supporting the ability to sort of advance the higher dose levels at this stage in the development is really outstanding. And we're proud to have investigators involved in the study standup again, just about 1.5 months ago and then again at AAO on Friday and present that type of data. I think that -- again, I would say that we coming into the assessment of suprachoroidal delivery, which we're using this device and this approach for the first time, we're the first company to be using this for AAV gene therapy, had a notion that if we were going to come in to the first dose with some kind of biological response, then we were going to have to see where we were on the dose curve. The other thing that we've learned from our experience with the subretinal delivery approach is that more time is better to assess whether or not you see substantive changes between different dose levels. And so usually, our first time point for sharing data in the wet AMD studies has been at 6 months, we may find that there continues to be some separation between dose level 2 and dose level 1 as we get out to later time points, for instance, at 9 months or 12 months. But to be at a place where we're seeing reduction in injection burden at over 70% and a full 40% of patients at this stage who have gone injection-free is a real excellent starting point for cohort level 2, dose level 2.

Okay, Ken. So I also got pushback. I think also EyePoint over the weekend also present some data, but that's a different mechanism. It's a sustained release format of the TKI. So they were able to share like over 80% or 90% -- sorry, 90% but there's not a clear dose response there, the [ bell shape ] activity. But at certain dose point, you did have over 90% treatment of the injection burden reduction. So any thoughts there, what you can add? This is -- certainly, we are talking about onetime gene therapy versus the, in the end, you still need a recurrent treatment and just to reduce the improved treatment interval. So any thoughts there comparing the injection burden reduction, the benefit to their comparison?

I don't know that there is...

Steve?

Yes. Steve, I don't know if you want to comment further. Gena, again, I want to emphasize that pharmacologically, we've done a lot of study of RGX-314 and have moved it, in fact, into pivotal phase at 2 doses with an understanding of the contributions that it can make to reducing injection burden in wet AMD patients, a safety profile, all along with our subretinal route of administration. The fact that we have that drug candidate, that pharmacological agent in a pivotal phase of study, and we're looking at it in Phase II studies to me, is evidence of a real mature understanding of the pharmacology overall. So when we're starting to read-out initial data from a Phase II study using the suprachoroidal delivery approach, it's giving us confidence to stand on the historical demonstrations of RGX-314 subretinally. I don't know that there's a way to compare it to orthogonal treatments that are either tyrosine kinase inhibitors or other biologics directly because there may not necessarily be that level of maturity in terms of the clinical data profile that sits behind that. But what I can say about our own data is that foundationally, it's the RGX-314 has established itself to be strong enough to move into a pivotal phase of development for the subretinal approach. And we're just now showing some of the first data in the suprachoroidal approach, and it's giving us very similar profiles and early understandings of the safety, tolerability and quality of the biological activity that's occurring here.

Yes. And I would just add that fundamentally sustained delivery via a onetime gene therapy is in a different category than any sustained delivery approach that involves giving a dose and then planning for retreatment once that existing bolus, although sustained, goes down below a certain level. And I think that's really important when you look at any data. So if you think about it, if a drug, a sustained delivery repeat dosing platform wants to ultimately get to every 3, every 4, every 5 or even every 6 months, they're going to have to show a certain stability over a certain time frame but you would anticipate that the injection free is going to go down over time, and you ultimately know that you're going to be retreating those patients. And that's what you see in any of these kind of other data sets. If you really look at apples and apples and watch out over time. So if you know it -- if a clinician knows, okay, I'm 5 or 6 or 9 or 12 months out with the gene therapy, that's one thing versus, okay, I'm holding on with this given patient knowing that I'm going to have to retreat. So I think, Gena, you hit the nail on the head when you pointed out that these are really different approaches altogether. So if you can have 70%-plus reduction in treatment burden and you can have something like 40% of patients not needing any injection in a setting where it's based on a onetime treatment with sustained delivery via gene therapy approach, that's where we get the excitement and that's the excitement we hear from the retina community.

Okay. Thank you, Steve. So since you are on the line, I wanted to ask you, when we look at the one pushback on the burden, the treatment burden reduction, I think that the other one reason when I look at the patient baseline that cohort 2 was not able to show the meaningful clinical benefit is to me is that some of the patient had -- are very relatively new to the treatment and then also has a relatively low treatment burden and therefore, actually hurting them later on. That you would not be able to see a similar or like a magnitude of the benefit that you would see otherwise in the more severe patient that will be easier to show. So given that as a background, like could you just remind us the rationale to include less severe patients and also relatively net new patient into the study?

Sure. So you'll recall, Gena, from our first-in-human subretinal program, that being first in human, it had a more heterogeneous population, including very chronic and also refractory patients or relatively refractory patients. So we enriched in this trial by excluding patients who have very chronic disease and also patients who are not responsive to anti-VEGF. Now fortunately, that still allows you to maintain most of the patients that you would want in your trial, but you exclude the very founding minority of patients who may not do well for reasons totally unrelated to the type of treatment you give. So we have a less mean duration of prior treatment. And within that range, as you point out, we have some patients who have only had 1 or 2 prior treatments before they get their screening Lucentis injection where we confirm that they respond to anti-VEGF. So it's almost like at that short end, it's a patient who is getting through their monthly bolus loading doses, if you will, with existing therapies. And that's certainly within the range of where, especially with a nonsurgical, in-office onetime treatment that patients and their doctors would be thinking about whether a patient ultimately might be someone they would consider for gene therapy. And the fact that these patients are actually enrolling into the study actually confirms that. So that's what our inclusion/exclusion criteria allowed for, and we're seeing that investigators are enrolling and patients are eager to sign up across that spectrum of fairly recently diagnosed to patients who've been on treatment for a little longer. And we still have the opportunity to see treatment response and assess within the trial. I think you raised a good point though, this is where looking at treatment burden reduction you can have a little variability based on that between what the prior average and range of treatment burden was for individual patients within 1 cohort versus another. And that's one of the reasons that we look at the totality of the data, not just the treatment burden reduction, but also how many patients were able to go injection-free and also how stable the anatomy and the function are.

Okay. And then so for cohort 3 and a cohort that -- the next few cohorts, if we think about the data. When we look at the cohort 2 versus cohort 3 and cohort 4 versus cohort 5, basically 3 is the same dose as cohort 2, but in one injection, higher concentration and you also include a patient with existing neutralizing antibody. So should we expect cohort 3 and a cohort 5 would not do better than cohort 2 or cohort 4 because of these reasons?

So we believe the one variable of number of doses administered. So we think 1 is better than 2. And scientifically and clinically, we think double the concentration over 100-microliter and still able to cover about half of the circumference based on what we know of suprachoroidal spread. There's as much a reason to believe in that for optimal efficacy as there is to more diluted concentration of a product over a broader range. But the beauty of this first-ever suprachoroidal delivery study is that already through 3 cohorts, having completed dose level 2 cohort 2 with the 2 injections and also dose level 2, but administered across 2 administration -- or 2 injections of 100 microliters each in cohort 3, we're going to be able to actually answer that question and assess that. And in dose level 3 in cohorts 4 and 5 which are enrolling now, where we'll double the dose again to 1e12, those dose cohorts will be with 100-microliter single injection. So we'll be able to assess that. But certainly, we're excited at the opportunity that we can look at a very simple 1 injection, 100-microliter injection across these dose ranges and across NAV negative and NAV positive patients. That other variable, Gena, that's why we're so excited to be at this stage. We started stepwise, looking first at NAV negative patients now having established a very good safety tolerability profile at 2 doses and also having looked in not only wet AMD but also DR, that's what gave us the confidence to advance into NAV positive patients. And having completed enrollment in cohort 3 in those NAV positive patients in August, yes, we're really excited to be able to get longer-term follow-up in that treatment setting to assess for that.

Okay. I know we are running out of time, but I do want to quickly ask. We know there is no underlying disease differences could cause different inflammation profile. Now we have 3 cohorts. We have so far 2 cohorts from wet AMD and 1 cohort from DR and we saw the inflammation range between 0 to 27%. So what could be the reason causing the differences?

I think the overall aspect is probably the small ends per group. And so you can almost think of with random chance seeing anything from 0 to 15 to 3 or 4 for 15, if the true underlying rate is lower. I think the key factor, and this is what we hear over and over from our investigators and our thought leaders, is the key aspect is not seeing any concerning findings in terms of higher intensity or patients who are refractory to treatment or any negative sequelae. And so the key thing is that these have all been asymptomatic, all mild and all easily treated. So that's what gives us the confidence that whether in wet AMD or DR, whether at dose 1 or dose 2, we're seeing a very good safety and tolerability package.

Okay. Well, thank you very much, Ken and Steve. Thank you, and I will certainly talk with you in the future and certainly in the panel discussion later today. Thank you.