REGENXBIO Inc. (RGNX) Earnings Call Transcript & Summary

Good morning, everyone. Thanks for being here today. My name is Ranveer Gathwala. I'm a Vice President in the Healthcare Investment Banking Group at JPMorgan. It is a great pleasure that we have REGENXBIO today here with us. We're joined by Curran Simpson, CEO; Mitch Chan, CFO; and Dr. Steve Pakola, CMO of the company. I will hand it over to Curran shortly to run through the presentation, and afterwards, I'll moderate a Q&A session with some questions. With that, I will hand it over to Curran.

Okay. I got a little bit of buzz there. Okay. Well, thanks for spending a little bit of your Wednesday morning with me. Really pleased to present the company overview, to start by having a look at the forward-looking statement slide. I will not read it to you, I'll spare you with that. This is a really transformational year for the company. For those of you that may not know us well, we've been in AAV gene therapy for roughly 15 years. So a long legacy, first is out-licensing company, if you will, products like Zolgensma emanating from our original IP and technology. And then in the last 8 to 10 years, really taking new programs internal and developing them ourselves. In NAV technology, there's 100-plus vectors that are within that NAV family. And we have five licensees, primarily via AAV8 and AAV9. And I'm proud to say that our technology, we've got over 5,000 patients dosed over the years.

We're going to mic you up so that [indiscernible] audio issues.

Okay. Thank you. This is a really pivotal year for us. No pun intended. We have a BLA under review for our Hunter program. I'll go through the pipeline and show you that. And we have top line readouts for two late-stage programs. One is the Duchenne program first half of this year. and then a very large wet AMD program readout with AbbVie late this year. So it's a real exciting time. And as a result of that advancement, we're gearing up, you'll hear about manufacturing today. for commercial readiness, developing that some on our own and some in collaboration with our partners. I'll just touch at the end of the conversation about new capsid development. So we have AAV8 and 9, those have been our base platform for years and years that our current programs are based on. But within our research team, we've been developing new capsids as well because we want to continue to evolve our technology and in effect, widen the therapeutic window for products. You'll hear a lot from AAV companies. I thought I'd start with what makes us different. As I mentioned, we have a capsid discovery and engineering team based on originally AAV8 and 9, we now have new capsids that we're working on preclinical that could be used in the suprachoroidal space, liver-detargeting, capsids, all of these really to be more tissue-specific and again, widen the therapeutic window for AAV create better efficacy, better safety and that's the long-term vision. We have a clinical development engine. Steve Pakola's team this year enrolled the two largest gene therapy trials ever run. And we're looking -- that's the top line data for the wet AMD study. And so we can scale significantly in our clinical development team and run very large trials very effectively. Last but not least, close to my heart being an ex chemical engineer. I'm just a paper pusher, but we have industry-leading manufacturing. So we adopted a lot of the advancements that were made in biologics and brought that into gene therapy. You've heard for years, FDA talking about how gene therapy manufacturing needs to mature beyond an academic setting. And we're definitely, I think, on the cutting edge of that scalable processes, high-purity capsid and great cost of goods in the future. just walk quickly through our pipeline. We have a rare disease overview. We also have a retinal disease overview. In rare disease, we get a lot of attention because of our Duchenne program. I'll show a little bit of new data later on that program, which is advanced. We've been fully enrolled our pivotal for RGX-202. And from a milestone perspective, we're pointing to top line data for RGX-202 in Q2 2026 and also pointing towards a BLA submission mid-2026. And it's not just the clinical aspects that we're getting ready. We're getting the CMC piece and the nonclinical sections ready. We have experience now filing our first BLA with the Hunter program, which is next and that program is in the late stages of a review with a PDUFA date of February 8 this year. I'll skip ahead to Sura-vec, which is the anti-VEGF program partnered with AbbVie. As I mentioned, fully enrolled pivotal studies, 600-plus patients in each study. And those patients, that top line data will read out late this year for both studies. So look forward to that outcome. And that's going to kick off pre-commercial planning in a much more significant depth with AbbVie than we've done before. And we feel super confident that us together with AbbVie in terms of commercialization readiness, this is going to be something to watch. It would potentially be the first non-rare gene therapy approved. So we're really excited about this indication. Equally exciting is a late-stage study will start a Phase IIb/III study for diabetic retinopathy first half of this year. That's going to a different space. So the wet AMD study is a subretinal injection, the diabetic retinopathy indication is into the choroid region of the eyes. So suprachoroidal administration. And then -- so -- and then we'll start that. And that, interestingly also has with it upon dosing the first patient in the Phase IIb study, a $100 million milestone associated with it. So a very comprehensive portfolio, a lot of late-stage catalysts for this year, a lot going on for a company of only 400 people. We're really proud of the progress we've made this year. I'll start with the Duchenne program. Most of you know that the long-term goal in Duchenne is very simple. We want to provide functional benefit to children who usually around 5 or 6 years old experienced a pretty significant decline in function. And so what we've been able to do with the program, and I'll talk a little bit about the specifics of RGX-202 is develop a novel construct. So our construct, if you go all the way back to the Elevidys AdCom, one of the reviewers spoke pretty candidly about microdystrophin containing a C-terminus makes it much more like natural full-length dystrophin. So that was one of the clues we had in development to say we should include the C-terminus. It's important in muscle repair, and we think that would potentially deliver a better functional outcome for patients than microdystrophin devoid of that. And that's what we aim to prove in our clinical studies. This week, we reported an extension of the 12-month data that we had already reported for our Phase I/II study, showing durability of effect, in fact, improvement of effect out to 18 months. So getting closer to a 2-year time point for some of these patients. And we'll have continued updates through the year on long-term durability as our functional data evolves. What's different about 202? I mentioned the construct. So it's based on AAV8, it's well known. We have a lot of experience with that vector, we can make a lot of it in manufacturing, which is important for cost of goods, and it includes the C-terminal domain, which differentiates in performance, particularly in our preclinical studies, mdx mouse studies, we saw a huge difference in functional benefit at the 2E14 dose, and that's what we've carried forward into our pivotal program. We get a lot of questions about our immune suppression regimen that's been consistent from the first patient dosed. We called it DL2, now we call it our pivotal dose. And we've had a proactive approach to immune suppression implemented from the very beginning of our study. And that has been one of the main factors in the safety profile that's evolving from our Phase I/II data. So we'll get into a little bit more detail on that, but that's definitely a differentiating aspect in which other companies in the Duchenne space have migrated closer to what we're doing in the clinic. Manufacturing, we talk about, we specifically targeted 202. It's a very high vector requirement because it's systemically delivered. And so focusing on high yields suspension bioreactor process, and importantly, high purity was the target of that program. And we're happy to have a process with really positive cost of goods outlook but most importantly, an 80% full capsid level in the batches we produce. It's one of the areas for our future BLA filing we pulled forward. We've already completed our process validation lots that would be part of the submission. And so we're really excited and very prepared to be a commercial player in this area. So the new data on the next slide I'll show is that, number one, all participants demonstrated microdystrophin levels above 10%. That's our primary endpoint. And so in Phase I/II, we got a good indication that we have a high probability of success in our pivotal program. We've -- to date on our Phase I/II patients had no SAEs or SAEs or AESIs observed. And I think what we're seeing as well we do patient reported or caregiver reported outcomes. It gets lost sometimes in numbers and data, but what we're seeing are children able to do sports, ride bikes, as you see here that never could before. That's an absolutely critical element of this. So we don't want to lose the human aspect of this. We're really thrilled that the kids are able to do all kinds of things that they never could before. And we're recording and logging those activities as part of the program. So just something that we're very excited about. We're recruiting ambulatory patients aged 1 and older. So very broad age inclusion criteria. We've completed, as I said, the pivotal trial enrollment. We immediately went over to enroll another 30 patients for the confirmatory study, and we're pointing towards having substantially all of those patients recruited by the time we file. So we'll have roughly 50 to 60 patients dosed by midyear. So it's really exciting. We're seeing a lot of growing interest in the program as we report more data. So to get to data, this is what we reported at the World Muscle Society at 12 months. So you see four patients here. And you can see that -- in each case, at least three out of the four cases, we have a substantial improvement in NSAA versus the natural history control analysis and also CTAP, which is a new analysis that we're starting to utilize. And so we were really excited about that. The overall change is 6.6%. And I think important, we get asked the question, what's clinically meaningful? A change of about 2.5% is considered clinically -- minimally clinically meaningful. So at 6.6%, we're well above that. And here's the exciting new data at 18 months. Now we're looking at a larger change. So patients continue to improve in function on NSAA above where they were at 12 months, now at 18 months. And you see even more separation now in the fourth patient as well. So first indications, and this is something we're very interested in because early data, we reported really high vector copy numbers from our initial biomarker data. And that gave us a clue that maybe this could actually contribute well to durability of effect. And so this data is starting to support that. We need to go further, but at 18 months, we're seeing continued improvements. So now we're at a delta of 7.4% in aggregate, which is roughly 3x what's minimally clinically important. And so NSAA is one where, I think in the Duchenne community, people had walked away from that as saying it's unreliable. It's not as specific. We like time to rise better because it's more easily performed. But I think the fact that we're seeing big differences in NSAA in our patients tells you that the drug effect is very pronounced. And I think that's super important. So when I look at the program and I think about where we are, and I think about future conversations with the FDA, I think safety is incredibly important. We're seeing really, really good safety outcomes in our patients. But just as importantly, we're seeing the functional benefit as well. So the benefit to risk ratio we feel of our product is really something that is going to move this program forward quickly. I love fireman's thermometers. So I requested the team build me one of these, I don't know, maybe I'm too old to know what a fireman's thermometer is. But just to check off some things that we've done and things that will be coming. So we've already manufactured batches that are eligible for commercial supply. As I said, we completed enrollment of 30 patients and we're continuing to enroll. We pointed to, again, a substantial number of those patients being recruited ahead of our filing date. In March, we'll have an additional data update on our Phase I/II data at MDA. Early Q2, we'll have top line pivotal data. Along the way, we'll have additional FDA and EMEA interactions. And then all pointing towards a BLA submission midyear. And I would say that one reason that I feel great about this is we did roughly this level of execution in 2025 and delivered on every one of targets that we had set. So I feel like operationally, and as a company, when we say we're going to do something, we deliver. And I think that's been demonstrated and set up as well for this year. What are we doing in terms of demand? We're obviously thinking about broad ambulatory access. We've been treating patients, as I said, from 1 to 11, might have had a 12-year old in the study to date. So a broad inclusion criteria. We have full control of our drug supply. So we can produce up to 2,500 doses per year in our Rockville facility and we can also fill drug in our Rockville facilities. So both bulk production and fill finish. We're activating additional sites, not just for clinical development, but also seeing that when our investigators get experience with our program, they become champions for it. So we want to expand sites that we're at to get that experience and continue to let investigators see for themselves how the patients are doing. And then we also are looking at expanding globally. So plans for ex U.S. studies as well. So a lot going on, but a lot of energy moving this program forward. As I mentioned, for the Hunter program, we're in the middle of a BLA review now. So I won't speak to a lot of specifics about that, but it's a very active review. Hunter, I don't think there has been a new treatment in Hunter for 20 years. And so there's a huge unmet need here. We deliver directly to the CNS. And there's roughly 500 patients in the prevalent market per se for the U.S. And on an incident basis, it's ultrarare, so it's roughly 50 new patients per year. There's been a lot of advance in newborn screening for MPS and we want to come in synergistically with that with a treatment that we feel our data demonstrates, number one, really good reduction of biomarkers. So I'll show here that the reduction of D2S6 which is similar to heparan sulfate, is roughly 80% after treatment at week 16 and then all the way out to a year. And that's commensurate with improvements that we see in neurocognitive development for younger patients. We see normal neurocognitive development or more normal. And then for patients that are older who have already experience neurocognitive decline we're seeing stabilization or slight improvement. And that was really what we were targeting. Over time, I would expect this will move to treating younger patients. We want -- we don't want to treat patients later because you can't reverse the degradation that's happened. So I would expect over time, and that's why in our study, we included some very young patients as well. So we're really excited about this data. We're, as I said, in an active review. We have a PDUFA date, February 8, and we have really exceptional clinical data. We published in September additional full year data on the program as well for you to see. So looking forward to kicking off the year with a positive outcome. Sura-vec. So back to the retina franchise, as I mentioned, the first potential gene therapy for chronic retinal disease. Wet AMD is the program that will read out later this year. There's a lot of excitement in AbbVie. They pay 2/3 of the development cost. So you imagine 1,200 patients. These are big studies. And it's wonderful to have AbbVie with us on that because it takes a lot to stand that up. But now we're in the data collection mode with the patients and as I mentioned, pointing to top line data. We think there's a really meaningful place in the market for subretinal injection. I think there's been skepticism about that. I understand the skepticism. But what we see is a real strong adoption of programs that extend intervals between treatment. And you can't get, as shown by this data, better extension of treatment than some patients here that are 4 years out without supplemental injections. So we have long-term durability already demonstrated from our Phase I/II studies via the subretinal injection. And very importantly, for retina, we also have really incredible safety demonstrated because of the -- we're going to an immune privileged section of the eye. And so we're really looking forward to this data. I think there's a lot of excitement growing in the field for this. And we see very high interest of the retinal specialists in a gene therapy coming to market. So all eyes on this. And then last, I'll talk just a little bit about diabetic retinopathy. You can see here, again, trying to treat diabetic retinopathy early to avoid these vision-threatening complications is the real goal here there's a proven -- we know Lucentis works in this, but we know the adoption is very low. And why is there very little adoption because people don't want to get a monthly injection at 45 years old, to control it or maybe they don't even have symptoms at that point. And so again, this is a perfect solution for gene therapy. We have already 2-year data showing dramatic reductions in [indiscernible] and also lack of events occurring. So we've prevented disease progression. So we think that this is a case where gene therapy is an ideal fit for a market that really has never experienced much penetration. Because already going into a Phase IIb/III study, we've established 2- to 3-year durability. And so that's well within the target product profile we've described before. Last, I'll follow up with manufacturing. We have beautiful anybody that's in the room that wants to come to Rockville, you have an invite to see our manufacturing facility. I didn't -- I'll tell my manufacturing head later, I said that. But we're really, really proud of it. It's a beautiful facility. It goes up to 2,000 liters in capacity, and we can dose -- we can create 2,500 doses per year of RGX-202. We have a second side of the facility that can produce up to 350,000 doses for Sura-vec. So we have -- this is for Sura-vec, that was one of the real strong basis of the AbbVie relationship was our ability to manufacture. So we're really excited about that. This facility was inspected in the summer by FDA for the first time, no observations. And I'm really proud of that as well, the ability to put this together, put it together a gene therapy platform that's scalable and then have FDA come in and say you're doing it the right way was really gratifying for the team and for the industry, I think. Productivity is important. I think there was a statement years back by FDA that said, if you don't have above 50% full capsid, you really shouldn't be going into the clinic with that product. And we took that to heart. As I said earlier, we're up to about 80% full capsid, in particular, on the high-dose Duchenne program. And I think that contributes positively to the safety profile. And this is actually the last slide, sorry. I just wanted to mention, we have a couple of new additions to our pipeline diagram, and they are based on -- in this particular case, new capsids that we've developed that are specifically developed for suprachoroidal. And what has that enabled us to do. We're able to get either the same amount of transgene expression with a much lower dose. Or we're able to get to the same dose and basically produce maybe 8 to 10-fold higher transgene levels. And that's really important for the eye because, again, it widens the therapeutic window that you have to work in without getting to a high dose where you start to see inflammation and things like that. So this is a case of our research team being really smart with development, knowing what to look for, what to manipulate on our existing vector platform to improve performance. So unmatched in-house end-to-end capabilities, leadership in gene therapy. We've been doing this a long time. We've gained a lot of experience not always the best experience, and we've corrected that. And this is the culmination of years of learning that we want to bring really great therapies to patients that are safe. Exciting near-term catalysts. This is a big year for us, pivotal readouts. And obviously, the main goal here is creating long-term value for patients. So letting patients get off of weekly infusions of enzymes, for example, letting patients get out of going to the doctor every month to get an injection in their eye. So these are really meaningful outcomes that we hope to bring to the market. And with that, I'll stop.

Thanks so much, Curran. That was fascinating presentation. I think it's amazing that there's so many shots on goal in different areas, too. So that's what makes it very exciting. Maybe I'll kick it off with some questions focused on each part of the pipeline, starting off with 202, and thanks for joining us, Steve. Thinking about 202, when you first started the program, you must have been fourth or fifth to market. And since then, a lot has changed. So maybe could you speak to how the competitive landscape has evolved, how you're thinking about what role 202 could play for patients and how that ended up happening.

Yes, I think -- can you hear me okay?

Let's try again.

Test 1, 2. Yes. That's okay. Yes. Great. Thanks. It's a great question. Yes. When we started, there were other entrants ahead of us. And that was, I think, a driving force for why we chose differentiation. It's not making something that was the same as that was out there, but actually trying to look forward and say, what are things that we see in the field that we could do differently to end up with a differentiated product that might take a larger place in the future commercial market. And as you said, a lot has happened. Programs have gone away that were intended late-stage programs. And our program has accelerated. We completed pivotal enrollment 3 months ahead of when we had planned. And we're on the cusp of top line data. I do think that no one could have predicted some of the things like the safety issues that have been found, liver enzyme elevation, things like that. And that's where the proactive approach we've taken to immune suppression has really helped with that. The main goal with Duchenne is to deliver as much product as you can to maximize the chance of functional benefit. But in trying to do that, you take risk, right? And what we're finding is that the combination of the high purity and the immunosuppression regimen allows us to deliver at a high dose. And that's where we're starting to see these really remarkable functional outcome. So I think, ultimately, I think we have a really meaningful place in the future commercial market as a result of that, not the least of which is we can make enough doses in 2 years to cover almost the whole prevalent market.

That was the immunosuppression regimen that you started off with, maybe if you can comment on that in a little bit more detail. We've seen when that first happened, people were questioning it. There were a lot of how is this going to work? And now we're seeing competitors or other folks kind of adopting a similar strategy. So could you maybe walk through what that suppression regimen looks like and maybe why that's so important to the success of the program?

Sure. Thanks for having us, first of all. Curran really hit on the aspect of early on what we did not just with the immune regimen but high purity. And that's really based on our expertise in this area and really having been leaders in the gene therapy space overall. So we did a lot of investment upfront and really thinking about how do we get to an optimal dose safely. And A lot of people don't realize this, but though I think they're realizing it more and more that a key part of efficacy is the safety because if you don't have the safety, you're not going to be able to get to the right dose. So the triple regimen. So we have the increased steroids that is traditionally used. We've also included two other agents that importantly are very targeted to what's been seen with other programs. So this is our learning from other programs, not something we've seen with ours, but safety first for the reason we mentioned getting to an optimal dose that -- and a dose level that others have not been able to do. And this is before some of the unfortunate effects for the community that have been seen for other programs. So one aspect, obviously, liver injury that you mentioned that with existing therapy can be quite extensive. So we have Sirolimus and we also have Soliris or eculizumab. So another category that's been an issue is complement activation, which can lead to thrombocytopenia, but also more serious TMA. And what we've seen as clinicians have taken this up. It's sort of a paradox because -- but that actually makes sense when you think about it is that by having a little more effort upfront, you actually decrease the monitoring and reactive steps that are needed. So if you don't have 40% liver injury because of your regimen, you're not having to have more treatment and more visits, more blood draws. So we're really set up to not need things like relocation of patients for 3 months with excess levels of monitoring to have to retreat reactively.

Amazing. And looking ahead for top line data coming up in the second quarter, what types of data should we be expecting as far as disclosures? And what would the benchmark for success look like from your lens?

Yes. So for top line data, we expect to have obviously, an update on safety for the pivotal group. We'll have full microdystrophin data on all 30 patients. And we'll have functional data for a subset of them that have gotten out to months is where we tend to first look at this in a pivotal setting. So I would expect to see those as the key elements of the top line data.

And you mentioned in the presentation that you're going to have a discussion with the EMA as well. Maybe if you could talk about your strategy for outside the U.S. and how you're thinking about the program globally?

Yes. I think globally, there's still a need in EMEA to have a placebo-controlled study as part of your overall approach. We have some designs that we've worked through that we want to get feedback on and then start to implement. So it is part of a longer-term strategy to go beyond just U.S.-based development.

Great. I'm going to switch gears to -- just to make sure we have time to cover all programs to 121. You mentioned that we're getting closer to the PDUFA date. To the extent you can comment on how that process is going? And any additional insights? Is there anything that you have to do between now and when you expect approval?

Yes. I think we've had the customary information requests along the way. We've had nicely face-to-face meeting in White Oak with the team, review team, which I think was very productive. It's the first face-to-face. I think we've had in 2 to 3 years now. So I think that was very helpful. If you think about the sequence of review, we had nonclinical review quite early. CMC with the facility inspection was midyear. The last submission was the clinical module as part of the rolling BLA. So most of the recent dialogue has been around the review of the clinical module. Again, we showed some of our data here. We think it's extremely compelling. And I would characterize is we haven't gotten an information request. We didn't feel like we could really adequately respond to with our data set.

Amazing. And I think people are also looking at Denali's MPS II program as well with, I think, a PDUFA set for April of this year. So maybe could you comment on how none compares and if there's any overlap or competitive positioning?

Sure. I think they're both using accelerated approval approach using a surrogate biomarker. So that's similar. And both, I think, of us have shown really substantial reductions of that biomarker. I think in a commercial setting, something that's a true differentiator is it's a onetime gene therapy. So you have a choice between a weekly infusion which seems very effective from what I've seen or a onetime gene therapy treatment. That's why we're really bullish about our prospects that even if people go on to enzyme replacement therapy, for example, over time, because of the burden of treatment, they're going to want to consider gene therapy, and we think we have a really strong value proposition.

And that program is partnered with Nippon Shinyaku. Maybe if you could comment on the terms of the partnership and what each -- what role each party plays as part of that partnership?

Yes. So they are in charge of the overall commercialization. They already have an existing rare disease sales force in place, and we're in charge of the manufacturing and supply chain aspect of it. And then we have -- in terms of the financials, I would say, meaningful double-digit royalties that come to us as a result of sales. And they do -- there could be an option to expand other countries beyond what they initially partnered with us on. So opportunity for growth in the program.

Amazing. I want to have some time for 314 as well. So for the wet AMD program, I feel like the slide largely under the radar for the most part, but it's kind of coming into the spot right now. Can we maybe chat about what the clinical hypotheses were and how the partnership with AbbVie came in place and why you ended up pursuing this so far.

Yes, I could start and then maybe Steve can talk a little bit about the studies themselves. I mean the partnership for AbbVie, I think, materialized roughly 3.5 years ago. And I think the upfront view that we had was REGENXBIO wasn't going to build a sales force for retina. And so this is where AbbVie came in as an obvious candidate that they have an existing large sales force. They have a franchise in ophthalmology. And so it was a very good partnership. It's been a good partnership in terms of our relationship with them over the years and -- but they do think big. And so the reason these are big studies is they're developed for global purposes. We've recruited roughly 100-plus patients in Europe as part of the ASCENT study. And so they're powered for broad submissions and filings that would support a global program. So I think we're really excited for next year. I think those watching gene therapy, looking at the first non-rare indication coming to top line data will be exciting to see how does that fit in a commercial setting. And I'm really optimistic that AbbVie can really exceed people's expectations on subretinal administration.

Sure. So over the last few years, it's really been great to work with AbbVie. The really allow us to do what we've always wanted to do, which is to get 314 to as many patients as we can. So -- and also what a great validation to have a company with the experience and expertise globally also in eye care. So it's really worked out the way we've hoped. And it's not just for wet AMD, but of course, for DR, we both see the unbelievable untapped potential for a onetime treatment to address that really massive unmet need.

Thank you so much. I think we just came up on time, but a great presentation. Thank you for the Q&A. Thanks so much.

Thanks for having us.