REGENXBIO Inc. (RGNX) Earnings Call Transcript & Summary

Good morning, everyone. My name is Gena Wang, and I'm a SMID Cap biotech analyst at Barclays. Welcome to our seventh Gene Editing & Gene Therapy Summit. It is really nice to have this event happen again. I would like to thank all the participants, investors, companies and especially our event team and corporate access team who made this event possible. And with that, I would like to introduce our next presenter, Ken Mills, President and the Chief Executive Officer of REGENXBIO. Ken, thank you very much for joining us today.

Good morning, Gena. Thanks for having us.

Okay. So I think we will start with -- can you hear me? Okay. We will start with, say, the DMD program, your DMD gene therapy program. So maybe start with like now given the evolving dynamic of the DMD gene therapy space, so how would you -- how do you see your construct -- and also especially after, say, Ad Comm that we saw 2 weeks ago, the FDA's view and in today's announcement, how would you see your program? I know you have a differentiated C-terminal domain. And how do you see your program will be differentiate from the competitors? And what could be the development path for your candidate?

Sure, Gena. And yes, thanks. So obviously, there's been a lot of information and sort of knowledge that we've all been able to gain in the last few weeks, especially with respect to FDA and their considerations of the accelerated approval pathway for an AAV gene therapies in the microdystrophin. Just to remind everyone, our RGX-202 is also an AAV gene therapy one-time for the treatment of Duchenne. It does have, we think, a highly differentiated product design. It delivers a transgene for a novel microdystrophin that has similar elements to other candidates that have -- and are being explored in the clinic, but it also includes functional elements that are not part of other reagents that have been in the clinic. And Gena, you set me up, I think, a bit by referencing that the C-terminal domain, which is found naturally in occurring full-length dystrophin, and FDA pointed out it's also found in sort of partially translated products in Becker patients, which is, I guess, we would consider an attenuated form of manifestation similar to Duchenne, in that our scientists, and I think Olivier Danos, our 2 Chief Science Officer, among others, had thought this an important aspect of making improvements to microdystrophin reagents that are being explored clinically. So we were pleased to hear a little bit of discourse about that at the FDA Ad Comm. I think talking about the C-terminus, its function, its function in terms of stabilization of fully translated product, but also its involvement in the functional recruitment of other proteins to stabilize the cell membrane, was actually highlighted in a meaningful way. And we do think that, that's an important differentiation. It looks like one that would be considered by the FDA, right, in terms of searching for evidence to justify processes for accelerating different types of microdystrophins using AAV. But in addition, we've made a lot of investments and put a lot of focus into our manufacturing around all of our programs. But specifically, our Duchenne program, I think we, as a group and a class, still understand that microdystrophin products that are being studied in a clinic are among some of the highest levels of viral titers that we're seeing delivered systemically. And so that puts pressure on supply, and supply chain puts a lot of focus on quality and purity and scalability. And so we've chosen to invest in that early to invest in a scalable -- commercial scalable process, used that out of the gate in our clinical development plan so that when we transition from sort of first-in-human work putatively to pivotal work, we're not going to be making material changes to process. And I think, again, something that was meaningfully highlighted and emphasized at the recent Advisory Committee discussion was, what can happen when different types of processes along the way are used in development and how that may impact consideration for things like accelerated approval or approval in general? And finally, I think, for us, the biggest takeaway recently, and again, it's something that squarely overlaps with our approach, is that the agency is obviously and seriously considering the use of microdystrophin as a surrogate biomarker that's reasonably likely to predict clinical benefit. And I think that that's the universal statement for all companies and the community at large about the emphasis. I mean there were obviously some opinions that were raised about the sort of benefits, considerations of that. But I think, in general, both the outcome at the panel level [ will vote ] itself. And I think where we've understood and taken away -- and I think we've seen -- like we are probably both digesting data, Gena and your team, from just about an hour, 1.5 hours ago as well, to further emphasize that point, in fact. And for us, that had a bigger read-through than just our microdystrophin program. Because we certainly expect, and would want to apply for, the opportunity to use accelerated approval with our microdystrophin with the C-terminus and an improved manufacturing platform, which means probably fewer patients that are going to be required for sort of pivotal phase and more consideration that can go into all the things that would support acceleration. But we just love that there was a public Ad Comm about accelerated approval for AAV in general. This is something that we've been very focused on as a company, as leaders in this space, and it's something that we're emphasizing and applying it in other parts of our pipeline, including, but not limited to, our treatments for Hunter syndrome and Hurler syndrome and the CLN2 form of Batten disease, all of which are rare diseases with high unmet need that involve sort of clinical pathologies that, at times, can result in very quick progression of disease. And in other cases, it can be slower and more progressive, can be heterogeneous in small populations, sometimes hard-to-design powered clinical studies to sort of capture in a reasonable amount of time clinical functional effects. But there are really good biomarkers, things that are natural substrates of the full-length genes that we're expressing, therefore, that, in support, a very strong argument for biological possibility. There's also a lot of natural history data that supports evidence of when there are -- and these are different than microdystrophin cases, where we're expressing full-length genes, full-length proteins, exactly how they exist in nature. And we're observing their interactions with their natural substrates and seeing changes in those substrates that represent normal function. These are things for us that are squarely in focus for why and how accelerated approval should be applied. And FDA has, I think, given us a lot of evidence in the last couple of weeks that they're open for business in terms of receptivity to those things. So for us, BLAs are coming for ongoing clinical trials that we've announced. And hopefully, more to come, based on our pipeline and use of the accelerated approval pathway and key differentiators, both to support rapid development, but also, I think, important improvements and innovations in science and manufacturing and quality that can be difference makers in the marketplace as well.

Great. Ken, so maybe a few questions, quick questions here. So first, what is the percentage of -- like your manufacturing, you have also your internal manufacturing process. And what is the percentage of your full capsid? I think that was one part raised by the FDA. And there was a 50% full capsid. What is your percentage of a full capsid?

Yes. We have really stringent requirements that capture a whole host of things that are a focus of both quality and purity for RGX-202 in our manufacturing process, Gena. So I wouldn't limit it to just what is the percentage of full to sort of empty capsids as a ratio, as it was highlighted in the Ad Comm. There's a lot of important things, some of them are sort of derivatives of that concept and some of them are extensions of it. Anyways, we've had a really healthy and important dialogue with the agency for what they think the bar is for those requirements. And we view that we're above that in meaningful ways in terms of focus on both quality and purity. And importantly, again, we're starting there. These are not things that we're planning to improve on over time and hoping to get there, where they're certainly not things that we think are going to become at risk of falling below the bar between the beginning of first-in-human through the plans for commercialization. And I would emphasize, too, that we obviously have some large and late-stage -- 2 large adequate and well-controlled studies happening in wet age-related macular degeneration for RGX-314 program. Same platform, same concepts. We're currently in the process this year of running sort of qualification runs in our facility to support BLA filings. And so this has been a multiyear, multi-program dialogue and investment on our part and with the FDA, planning for multiple different types of BLAs and being well above the line of what's expected in terms of quality and purity, really being -- playing a role in setting that standard.

Okay. And another quick question is regarding -- for your Phase I/II study, you will share a 3-month biopsy data, right, the second half of this year. So now we saw -- actually, FDA drew a linear correlation of protein level and the North Star. And when we look at the 40% to 50% protein level, that would translate to 2 score North Star improvement. So what will be your goal for your protein level, say, second half this year when we see the data?

Yes. Again, Gena, I think that -- the discussion at the public Ad Comm about one microdystrophin reagent that's being studied in the clinic is foundational for, I think, a more broad public understanding. I think we started off talking when you asked the question about what's different about our microdystrophin, though, than what -- others? And inclusion of a domain that is known to be important in microdystrophin, rather full-length dystrophin function, is a major differentiator that, in our view, is going to be something that is exposed at later time points and more based on assessments of clinical functions. So looking at North Star at one year or even beyond one year is where we would expect the role of the C-terminus domain and its responsibility to helping to sort of stabilize and reinforce dystrophin function, but translating into longer-term clinical function for cells and muscle tissue and so forth. What I mean, basically, if I were to distill it down, is that I think you have a microdystrophin product that includes the C-terminus. It has the ability to -- probably in drug development parlance, to be more potent. And that potency, therefore, is something that, at the same level, same dose levels, would have more of a functional effect. So now I might submit to you that we're coming in starting with doses that are similar, if not identical, to where pivotal phase doses are being explored by people like Sarepta and Pfizer. And we expect to achieve levels of microdystrophin expression, therefore, that are similar, within the same range of what they've achieved at those doses. However, we expect that our microdystrophin construct is going to be more potent than that. And so you might translate that into better outcomes with respect to things like North Star function at one year and beyond. So I think that the connection is -- we've shown preclinically that we have that type of differentiation. We think that we can, at least, get the same number of microdystrophin molecules expressed on a per cell or per tissue basis at the same doses. But we expect our microdystrophin to be something that's more functional, exhibits more function than some of the things that even FDA was highlighting might be missing in some of the microdystrophin constructs in the other reagents.