Rocket Pharmaceuticals, Inc. (RCKT) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen, and welcome to the Rocket Pharmaceuticals Conference Call, discussing the Phase I data results for Rocket Pharmaceuticals Danon disease program presented today at the Heart Failure Society of America Annual Scientific Meeting. As a reminder, this conference is being recorded. I will now turn the call over to your host, Ms. Jessie Yeung, Rocket's Vice President of Investor Relations and Corporate Communications. You may begin your conference.

Thank you, operator, and good morning, everyone. Thanks for joining our call today to discuss the Phase 1 results of our Danon disease program. This is Jessie Yeung, Vice President of Investor Relations and Corporate Finance at Rocket Pharmaceuticals. With me on the line today is Dr. Gaurav Shah, CEO of Rocket Pharma. We also have Kinnari Patel, President and COO of Rocket; and Jonathan Schwartz, our CMO, for the Q&A session. Before we begin, I would like to briefly discuss the use of forward-looking statements on this conference call. Statements made on this call may include forward-looking statements, and these forward-looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from the statements made. Factors that could cause actual results to differ as described in the disclaimer and in our filings with the U.S. Securities and Exchange Commission, including the risk factor section of our 2022 annual report on Form 10-K filed with the SEC. As a reminder, the call is being recorded, and the press release and slide presentation regarding today's results is available on the Rocket Pharmaceuticals website. There will be a question-and-answer session at the end of this call, in which we will all participate. I'll now turn the call over to our CEO, Gaurav.

Thank you, Jessie, and thank you, everyone, for joining us today on what we feel is a momentous day, not only for the company, but for the field of cardiac gene therapy. Today, we are incredibly excited to announce positive Phase I clinical updates from our much anticipated gene therapy treatment for Danon disease. And let me just say at the outset that the results have exceeded our own internal expectations. Let's start with Slide 3. Before we get into the details of the study results, let's spend a moment on Danon disease itself. Danon disease is a rare X-linked inherited disorder caused by mutations in LAMP2, which is an important mediator of autophagy, which is like the recycling center of the cell. This impairment results in heart failure and, for male patients, frequent death during adolescents or early adulthood. And we estimate that there are approximately 15,000 to 30,000 patients with Danon disease in the U.S. and Europe. Slide 4. Danon disease is a devastating disease with a high unmet need, and heart transplant is the only current standard of care. But heart transplant is associated with an approximately 50% mortality rate over the first decade post transplant. Males typically have a median survival of 19 years, while females can live at least 2 decades longer, but will still suffer from very poor quality of life in the interim. Slide 5. The symptoms of Danon disease usually start showing around age 8 or 9 for male patients, and patients develop symptoms of cardiomyopathy in their early teenage years. If they do not receive heart transplant or gene therapy, they will not even live into their 20s. The patients on our gene therapy trial are now living and actually thriving into their early 20s after receiving gene therapy. Slide 6. This slide shows how elegantly RP-A501 links together the pathophysiology of Danon disease with this mechanism of action into patient impact. Very briefly, the pathogenic LAMP2 mutation turns off the cells recycling center. This causes the accumulation of autophagic vacuoles, which leads to myocardial disarray and thickening, and this results in impaired cardiac function and ultimately heart failure and death. Slide 7. Today's Danon disease results are the most comprehensive gene therapy data set for any cardiac condition, and they demonstrate robust efficacy in adult patients in what I would call highly promising early results in pediatric patients. We feel that this gene therapy may ultimately result in freedom from the devastating effects of Danon disease, both for pediatric patients and for adults who would otherwise face heart transplantation or premature mortality. Phase I enrollment is complete, and there are 4 points that I would like to make. #1, the enhanced immunomodulatory regimen appears well tolerated and effective in the pediatric cohort at 6 and 11 months post-treatment, respectively. #2, the early LAMP2 expression data and clinical outcomes from the pediatric cohort are encouraging and consistent with what's seen in adult patients at the same time points. #3, the early clinical trends for the pediatric cohort are encouraging and consistent with the sustained clinical responses seen in adults at 24 to 36 months post treatment. And #4, study design and endpoints have been identified for a planned Phase II potential pivotal study and have been endorsed by an international scientific and clinical advisory board pending regulatory feedback. Slide 9. So taking a look at the current Phase I study design, which is the nonrandomized open-label trial. These results include early efficacy data with updated safety data as well from the low-dose pediatric cohort as well as updated efficacy and safety data from young adult and adolescent patients in both the low dose and high dose cohorts. Of note, 1 point in data integrity and assay centralization as we view this data set, pre-dose baseline values here onward will be defined as a mean value from visits prior to the infusion and all assays such as echo, labs, expression, et cetera, are going to be based on central core assays in preparation for pivotal trials. Slide 10. So far, we've dosed 7 patients across 3 cohorts. We now have a modified and final immunosuppressive regimen, which we successfully implemented with the low-dose pediatric cohort. This is the combination of rituximab, sirolimus and steroids with rapid taper. RP-A501 was generally well tolerated with a manageable safety profile across pediatric and adult patients. Slide 11. In the pediatric cohort, RP-A501 was well tolerated in both patients with 6 and 11 months of follow-up, respectively. The patients were observed to have normal range platelets, minimal complement activation and no complement related adverse events. The 2 patients received preventative treatment with a modified immunosuppressive regimen. We have learned from our prior experience that with each patient, we can institute what we've learned for the next patient. We believe that this new immune modulation regimen, combined with the lower total viral load for pediatric patient, mitigates; #1, the risk of thrombotic microangiopathy through Rituxan plus sirolimus; #2, immune rejection through T cell suppression; and #3, steroid-induced myopathy through induction of a rapid steroid taper. Slide 12. Here is the key slide for a pediatric efficacy update and a summary of improvements from baseline for both patient 1008, who has 9 months follow-up for efficacy now, and patient 1009, who has 6 months of follow-up. These numbers actually just came in earlier this week, and we see improvements across every single biomarker and potential endpoint. LAMP2 expression, troponin, BNP, Kansas City Cardiomyopathy Questionnaire and New York Heart Association Class all improved. In 1008, first patient at month 9, BNP decreased from a baseline value of 1,837 to 406 picograms per milliter and troponin from 1.89 to 0.28 nanograms per milliliter. In the second pediatric patient, # 1009, and month 6, BNP decreased from 297 to 113 and Troponin from 0.67 to 0.07. I want to highlight that both patients improved from NYHA Class II to Class I. NYHA class is a physician conducted evaluation of the extent of heart failure. There are 4 classes in Class I corresponds to no limitations in physical activity or signs of cardiovascular disease. Class II corresponds to moderate but notable limitations in physical activity and objective signs of minimal cardiovascular disease. Patients with Class II are typically comfortable at rest, but ordinary physical activity results in fatigue, palpitations, shortness of breath and findings of disease and physical exam. So basically, these pediatric patients went from having symptoms of heart failure and having no symptoms. I also want to point out a new measure that we disclosed today, which is the Kansas City Cardiomyopathy Questionnaire. This measures a patient's perception of their health status, including heart failure symptoms, impact on physical and social function and how their heart failure impacts their quality of life. We already see large improvements in the KCCQ score for both patients, and this complements the NYHA data set and provides more confidence that we're potentially seeing improvements in how a patient feels and functions for the pediatric cohort earlier than expected. Recall that changes for adults in NYHA class typically took a year or more. Slide 13. In the pediatric cohort, LAMP2B protein expression by immune histochemistry was 21% in patient 1008 at 6 months and 35% in in patient 1009 at 3 months. Here, we have shown the same method that we've shown previously in adults and this used Qupath, which is a bioimaging software that can be used for whole slide analysis. This was performed at UCSD using images derived from our Core Lab Texas Heart Institute. It's important to note that the analysis from Qupath was previously done by an academic assay, and as part of the evolution of this trial, we are moving towards third-party independent blinded assessment of IHC at the Core Lab, which also now qualifies for more robust regulatory discussions. Moving forward, we will report these centralized results. The results we've seen demonstrate that pediatric efficacy data is consistent with or better than the initial improvement seen in adult patients at a similar time frame. Slide 14. Here are the endomyocardial biopsy EMB images for patient 1008, first pediatric patients at baseline, month 3 and month 6. And you can see LAMP2B expression in brown and IHC as well as a significant reduction of autophagic vacules across both H&E and electron microscopy. At the top, the IHC here is graded using the Core Lab centralized method as mentioned previously, and here, we see patient 1008 reaching Grade 2, which is 26% to 50% expression, with the midpoint in the 30s by month 3, sustained at 16. The middle panel H&E is new to our story. Dr. Danon himself identified Danon disease initially in 1980 through simple H&E stains that demonstrated large vacuoles such as these on the left here. We see a reduction over time, and we have now been able to quantify the vacuoles using an automated method, which I'll show you in a minute. The yellow arrows here indicate the autophagic vacuoles, and you can see clearance of these vacuoles at later time points. Move to Slide 16. We achieved evidence of durable cardiac LAMP2B gene expression of Grade 1 or higher in all patients across both pediatric and adult cohorts using the Texas Heart Institute method as a core centralized lab. We also seen sustained LAMP2 by vector copy number starting at 6 months in the pediatric cohort out to 36 months in the adult cohorts. The trends in the pediatric cohort appear similar to trends in the adults. Of note, these VCN values are conservative and assumed binucleated cells, which likely represent only approximately 10% of cardiomyocytes in humans. Most cardiomyocytes are polyployed and multinucleated so comparing apples-to-apples with other cell types, a doubling of these VCN numbers would make most sense in estimating how many vector copies are present per actual cardiomyocyte. And this is how we have reported in the past before introduction of this more conservative method that you see here today based on binucleated cells. Slide #17. Here on the left, we see a reduction in vacuolar area from baseline using an automated method based on H&E staining. And this represents autophagy at the largest visible level we can see. There is an elegant link between protein expression and reduction in vacuoles, which can be objectively, automatically and independently qualified and quantified it. On the right, we see the overall vacuole area decrease over time from pre-dose using a population-based bar graph. And here, we're seeing 50% to 70% reductions in vacuole area that's durable out to 3 years. These data are exciting because they indicate that even modest LAMP2 levels equivalent to Grade 1 or greater on IHC enable quantitative reductions in vacuolar area, i.e., increased autophagy in myocardial tissue. And this increased autophagy is likely the key disease-modifying effect of RP-A501. Slide 18. Patients in the adult cohort demonstrated significant decreases in troponin that were durable. Specifically, the 4 adult patients were observed to have a mean reduction of greater than 75% in troponin from baseline through month 18 to 24. The 4 patients in the adult cohort also show sustained improvements or stabilization in BNP from baseline. Note that both pediatric patients also had major reductions in both troponin and BNP as early as 6 and 9 months, respectively. Slide 19. Here, we see that remodeling of the heart begins at month 12, and we continue to see sustained reduction or improvements on LV posterior wall thickness and LV mass across all patients from month 18 to 30. Slide 20. In the pediatric cohort, improvement from Class II to Class I and NYHA class was seen in both patients, and this improvement was observed in the first pediatric patient in 9 months and then the second patient in 6 months. In hypertrophic cardiomyopathy, and especially in Danon disease, it is a typical for patients to see improvements in NYHA class. But remarkably now, all 5 of 5 patients treated with a monitored immunomodulation regimen have now improved their NYHA class from 2 to 1 as early as 6 months and durable through 2.5 years and the 6th patient who did not have observed immune suppression still had, still has stable NYHA class at Class II out 3 years from treatment. Slide 22, summary. So for the pediatric cohort, RP-A501 was well tolerated. There were no drug-related SAEs. There is no worsening of skeletal myopathy. Increased LAMP2B protein expression was associated with early signals of improved cardiac histology and lab biomarkers, early improvements in NYHA class and KCCQ was seen for both patients. For the adult cohort, the low dose is well tolerated 2 to 3 years post treatment. Increased LAMP2B expression was associated with clinical benefits such as durable disease stabilization or improvements in KCCQ, LV wall thickness and mass, biomarkers and cardiac histology. All patients are alive and thriving in their early 20s. Slide 23. We've now achieved multiple improvements across different parameters, and we can now collect these endpoints together in preparation for our FDA discussions around the pivotal study. With regard to molecular expression, LAMP2B expression can be seen as early as 3 months. Reduction in vacuolar area can be seen as early as 3 to 6 months. Improvements in troponin and BNP can be seen as early as 3 to 6 months. Then improvements in wall thickness, left ventricular ejection fraction and LV mass can be seen as early as 6 to 12 months, alongside improvements in NYHA class and overall KCCQ scores. Slide 24 shows some patient anecdotes, which complete the story here. Focus on the bottom 2. These are the 2 pediatric patients. Patient 1008 couldn't even walk for a few minutes without being out of breath. And recently, he went to summer camp on his own for the first time and is no longer out of breath even walking upstairs. The second pediatric patient, 1009, even walked at 10-K with a spotter in the months following treatment at [indiscernible]. Slide 25. So our Phase I enrollment and treatment are now complete. We've shown a tolerable safety profile and positive efficacy across all parameters and across multiple possible endpoints. And we anticipate that these findings will be highly supportive of a discussion with the FDA around the potential pivotal Phase II trial, including a discussion around endpoints and study design. With that, I'll now open the call to your questions. Thank you very much for your participation.

[Operator Instructions] Our first question comes from Josh Schimmer with Evercore ISI.

Very encouraging data update. Do you have a question about patient 1001, who looks, like they lose expression of the LAMP2 protein. But with subsequent follow-up, there does seem to be a pretty impressive reduction in vacuolar area of the myocardial tissue. They do have a robust reduction of troponin. What do you think is happening in that particular patient that you're getting some mixed signals?

Yes. So great question. This patient, 1001, as a reminder, was treated without a closely monitored immunosuppression regimen. This was the first patient we treated, and since then, we've learned a lot about how to mandate immunosuppression as we move forward. So nevertheless, he continued to have reasonable protein expression at Grade I for quite some time. It may be that the assay that we're measuring doesn't quite capture the very low-grade protein expression that may be present in these cells. We do see positive vector copy numbers. We Have seen positive Western blots in this patient as well for quite some time. So it may be that this particular assay doesn't capture protein, but there could be protein there. And -- but, to your point, you answered yourself, there is decrease in vacuolar area that's very similar to some of the other patients. There is decreases in lab parameters. And from a quality of life viewpoint, the patient is also doing well. He is alive and thriving. So we think that this represents an example where even very small amounts of protein expression may confer stabilization of disease and certainly, this is the best example of that.

And just to add, Schwartz here. It may also be that as this patient is at steady-state autophagy after having cleared all the vacuoles, the actual autophagy requirements and LAMP2 protein expression are quite small in that steady state.

Yes. And no more patients will be treated without appropriate immunosuppression, right? So this was a one-off learning, I would say.

So is there any reason to think that maybe some of the inflammation that was caused by the procedure somehow may have ameliorated parts of the disease pathophysiology?

Unlikely that the inflammation would do that.

Our next question comes from Mani Foroohar with SVB Securities.

Congrats on a nice clean data set. Now that we have a reasonable follow-up in the pediatric cohort, a pretty long follow-up relatively speaking in adult cohort, can you walk us through exactly what next steps are in terms of your interactions with the FDA? Are we waiting for minutes for meeting? Just when -- what sort of venue do you think you'll give us some detail on what a pivotal Phase II might look like?

Kinnari will answer that.

Thanks, Mani, for the question. So this data package has been submitted to the FDA, and we have requested an end of Phase I meeting. At this point, we're expecting evasive action to take place before the year-end. And as soon as we have the agency buying on our proposed Phase II pivotal study design will definitely inform investors and the public.

Okay. And as a follow-up, you've noted there's been some differences as discontinuity between the speed with which you saw improvement on some endpoints in the pediatric patients and the somewhat longer time point in some of the older patients. recognizing a lot of [indiscernible] in the disease, but within either age group. Should we be thinking of these 2 populations as requiring differently label study, or is the right answer, just to pitch a study that's long enough to have a single cohort of patients across all ages?

Yes. Great question. So when we're enrolling patients, we found a much larger number of patients in the younger age group. It was more difficult to find patients in their late teenage years because they're progressing towards heart failure. So most of our patients are likely going to be in the 10- to 15-, 16-year-old range, just like the 2 pediatric patients here. So we think that, that's a better predictor of what the trial would look like and how their endpoints might shape out over time, Mani?

Great. That makes sense. And is it reasonable to assume for ethical reasons that there will unlikely [indiscernible] a placebo arm?

Yes. So Danon disease is a disease with early mortality. And although there is some heterogeneity amongst male patients, very few patients are alive and thriving in their 20s, right? So it really is a median mortality of 19 pretty consistently. And if you think about it, if we're enrolling a patient on a trial who's 12, 13, 14 years old, and this patient is likely to go to heart transplant or at least get on the list in the next couple of years, we feel here at Rocket and with our partners that it's not ethical to offer a placebo arm to those patients when a -- what seems to be a promising therapy is available. And I think that would be difficult for patients and families to accept as well. So we think the likelihood of a placebo arm is low, but we're open to doing whatever it takes to get these therapies across the finish line as soon as possible.

Our next question comes from Tyler Van Buren with Cowen.

Congratulations on the impressive data. As we think about the potential proposed Phase II pivotal study design, I'm curious to know what biomarker and functional endpoints you feel are more clinically significant, sensitive and reliably measured? So whether that's BNP or component on the biomarker side, or wall thickness or perhaps KCCQ on the functional side, especially given the striking rises in KCCQ scores in compliant patients.

Yes. Great question. So maybe I can refer folks to the staircase slide to have a visual here, which is Slide 23. So we've always talked about 4 buckets of endpoints. And I think it's important to identify 1 endpoint per bucket that makes the most sense. So in the biopsy-based endpoint, we think that grade of immune histochemistry expression is the most important surrogate marker. In the lab endpoint, we feel that BNP is the most reliable surrogate marker. In the echo imaging-based findings, we feel that maximum posterior wall thickness is the best marker. And then on overall clinical function, we feel that NYHA class is most representative. Now I do want to emphasize that moving from NYHA Class 2 to Class 1 is pretty rare in the field of hypertrophic cardiomyopathy, moving from 3 to 2 is 1 thing, but 2 to 1 moving from symptomatic to asymptomatic from many of the cardiologists that we've been working with is a pretty good deal. And to see 5 out of 5 patients with appropriate immunomodulator moving from 2 to 1 is -- was a surprise for us, a pleasant surprise. And obviously, we'll see data over time, but those are the 4 surrogate and clinical endpoints that we're going to be focusing on in our FDA discussions.

Okay. That's helpful. And the second question is just can you briefly talk about how many of these patients are currently identified or diagnosed what you're doing to increase that identification and what pivotal trial enrollment might look like moving forward?

So the true prevalence of Danon disease, we continue to remain confident that it is 15,000 to 30,000 U.S. plus EU. This is a new disease. Genetic testing for cardiomyopathies is still also new. And we feel, based on several partner conversations that the actual number of diagnosed Danon patients right now in the U.S. is probably in the low single-digit thousands range and similar in Europe. So over time, there will be a gap that needs to be filled between known diagnosed Danon and the true prevalence. There's not even an ICD-10 code yet for Danon, right? So there's work to do there. However, out of that pool of known diagnosed Danon patients, we've made some pretty significant headways in recent months through a bottom-up analysis and identifying these patients 1 by 1 in the U.S. and Europe so that by the time we start a Phase II trial, we'll be -- we're confident that we'll be able to enroll it with 0 issues.

Our next question comes from Greg Harrison with Bank of America.

Congrats on the data. So the expression numbers that you've reported, they look in line with or a little higher than the adult cohorts at the same time. What does this imply to you in terms of benefit of earlier treatment?

Yes. I think that we've seen in other programs anecdotally that pediatric patients tend to respond a little bit more favorably in general versus adults who are receiving gene therapy. Some of the adults may have onset of fibrosis already and pediatric patients probably aren't as far progressed with regard to fibrosis. So we may be seeing on the higher end of protein expression. I think remarkably the lab values that have markedly dropped in the early months, combined with the improvements in NYHA class and KCCQ scores was not expected in the pediatric patients. And that might be a trend that we continue to see as we enroll more pediatric patients. Obviously, this is and equals to, and comes with that caveat. But we'll see what happens in the Phase II trial. But we're optimistic that, based on this data set that we can be confident and even somewhat aggressive about proposing relatively shorter endpoints for a Phase II pivotal trial with a relatively modest-sized trial focused on key surrogate biomarkers.

These patients also received likely a much more optimal immunomodulatory regimen, which may also enhance transduction capacity. I believe there is some unpublished data from University of Florida regarding that, and we'll stay tune to review that further when it becomes available.

Got it. That's helpful. And then just 1 more, if I can. How are you thinking about the trend in the LAMP2B grade for the adult patients who were treated early on? It looks like it's decreased and some at the later follow-up. But the trend in vector copy number is less clear. How do you interpret these results? And what does that mean for your expectations for durability?

Yes. So first of all, one thing I did want to point out on this independent centralized grade-based evaluation of immune histochemistry is that this only captures the extent of -- the extent of tissue that is staining positive for LAMP2B. If we incorporated LAMP2A and C, then these numbers would actually be about 0.75% -- sorry, you have to divide these numbers by 0.75, so you get a bigger number. In other words, a -- do some math here. Like a 20, you'd have to -- if it was 20%, you'd have to divide by 0.75, which gives you -- David will tell me the number in a second. So these numbers are probably underreporting the true staining and the true extent of cells. 20 would be a 26.66, right? So that's 1 thing to keep in mind. And if you correct that factor, some of these numbers do come a little bit more in line with the Qupath That's #1. Now why are we seeing variations and fluctuations here? The thing to remember with LAMP2 is that this is a metabolic process. Autophagy is a metabolic process. It's not a secreted protein. It's not a structural protein. So the metabolic process is affected by fasting state of the patient. There's other post-transcriptional and post-translational changes that cause protein expression to vary over time. So I think it's important to look at all of these parameters in conjunction with 1 another. You got protein expression here, you've got vector copy numbers. We've also done western blot on all these patients. And in fact, some of the IHC numbers that are stable or decreasing are associated with increases in western block. And I think the question to ask here is not what is the exact number for protein expression because I think we can get stuck on something that makes some sense, but it's not the most important point. What's more important is, what is the minimal amount of protein expression that you need to see this array of clinical outcomes? And the answer to that question is, you only need Grade 1 protein expression based on this assay to see clinical benefit. That's the way that we look at it. That's the way that we've interacted with the FDA, and they've discussed with us that, that's how they look at it as well, right? When you have a clinical outcome, what is the minimal biomarker that produces that clinical outcome, not the other way around. So that's the thoughts here.

Our next question comes from Gil Blum with Needham & Company.

And let me add my congratulations for pretty impressive results. Given the data in adults, it seems it would be pertinent to develop it -- develop the program more broadly. I'm just curious as to what kind of age restriction should we expect in an upcoming pivotal?

Thank you for the question. This is Kinnari. We expect the Phase II pivotal study to remain 8 and older. The reason for that, you're absolutely correct. We could broaden it. We want to make sure there are so many patients waiting for therapy that we want to make sure that we can get the drug quickly submitted and approved to the agency, both in the U.S. and the EU. And in order to do that, we figured if we have the population consistent with our learnings from Phase I, we can really rapidly develop this into a Phase II in an accelerated approval pathway. And for life cycle management, we will expand it to even a younger age group as well as expanding it into the female population.

Also touching upon a topic that was discussed earlier, it really does appear that there's rapid functional improvement. So I'm assuming this could affect potential timing for a pivotal study, if you have any comments around that?

It could potentially have that benefit. We are hopeful for that. We do anticipate the pivotal Phase II study to be biomarker-driven [indiscernible] approval pathway. That's our proposal to the agency with the follow-up of anywhere from 12 to 18 months to get a confirmatory efficacy to be seen as well as consistent benefit risk. More to come on that once we have the agency end of Phase I meeting.

Our next question comes from David Hoang with SMBC.

And again, congrats on the what looks like a very promising update here. So I had 1 question just here on this NYHA class improvement looks pretty impressive to me. I was wondering if you had perhaps looked at 6-minute walk test test in these patients? And if you had -- was there any kind of something that might correlate to the early NYHA improvement? Or would you plan to potentially report that in the future?

Yes. We have done 6-minute walk test for all these patients. We have not emphasized 6-minute walk test because it is limited by muscle weakness in muscle pain, which is also a hallmark of Danon. So a patient could normalize their heart function completely and still have a impaired 6-minute walk test because of their myopathies. Nevertheless, when we have looked at the 6-minute walk test across all patients, except the most recent pediatric patients who has 2 short of a follow-up, we see stabilization or even modest improvements in 6-minute walk test all the way out to month 36 in these patients. And we'll report that at a later time. It's a great question.

Great. That's great to hear. And then I just had on the regulatory and the question. So given it sounds like you do, in fact, intend to propose accelerated approval in the Phase II study. Do you already have some thoughts about what the confirmatory trial design would look like? And are you going to also propose that to the FDA and you're in the Phase I meeting?

Yes. Typically, we -- by the time we submit the design of the pivotal Phase II, we want to have some discussions around what a confirmatory trial would look like. But most of the agreement on the conformity trial, those discussions are had closer to your BLA for the accelerated approval. So confirmatory trial is something that will develop as our natural history develops in the next months and years.

And just 1 thing to add to that. What we've done for programs like Fanconi Anemia, we hope to do for this program as well is just to follow the patients longer in the duration of the study. So it's not necessarily that we would have an additional study being added. But following these patients longer to see the NYHA class and some of the more clinical functional components to be aligned for a conversion of the excelled approval into a full approval at a later date.

I see Okay. Very helpful. And maybe just 1 last one, if I can sneak it in. I believe you do have a natural history, natural history cohort that you've been assessing as well. Can you just talk a little bit about the size of that group and how well characterized is it? And are you looking to [indiscernible] the control arm for the pivotal?

Yes. So we have a 3-step approach for our natural history. We've done a retrospective literature that was already published. We have a U.S. registry based on chart reviews that actually dates back to 2006 with more than 100 patients in it. We have a prospective natural history that has 10 patients at the moment, but it will grow. And we also now are starting to look at our EU natural history, which will likely have more than 100 patients there as well. So we'll be sharing this data with the FDA. We'll be updating the natural history as the program progresses. And I think natural history will form an important backdrop for the study design, especially if we are going with a single-arm trial, as we've discussed.

Our next question comes from Colin Bristow with UBS.

I'll also add my congrats. Really great progress here. A few things to expand on from my side. Just on the adult BNP data, I mean, obviously, you highlighted this has been the best lab biomarker. We touched upon it a little bit already, but we've seen sustained lowering in 2 patients, but 2 patients saw the level rise back up above the baseline. And then obviously, when there is [ once ] or no improvement in the NYSA classification. Could you just -- yes -- what are your thoughts around these trends? Second, just sort of more of a housekeeping question. On your vector copy number data, it looks like some of the numbers have changed versus your 2021 update. Just wondering what the reason is for that? Is the -- have you changed your quantification method, or is it due to your assay centralization?

Yes. Let me answer the BNP question first and then the vector copy number questions, both good questions. So on the BNP, first of all, patient 1001 is the one who did not get closely monitored steroids or immune suppression and has the lowest protein expression. So on patient 1005, this patient -- we don't know exactly why there's fluctuation there. But I think it's important here that BNP remains stable. Stabilization here is a win and -- versus a natural history where we've seen in about 20 patients already that the BNP increases over time by a certain number, which has a relatively small standard deviation. So when we designed the study, we would look for BNP in the natural history going one way and at least stabilization or improvement in the patients who have BNP post-gene therapy. That delta is how we think about the size of the trial and the power of the trial, right? So stabilization here is a win. There's going to be fluctuation in patient to patient, and that doesn't concern us. We have to look at the totality of data, which will include protein expression, BNP, wall thickness and some clinical functionality as well.

Great. And on the [indiscernible] copy number disparity.

Great. So this new VCN methodology is now validated and is ready for setup for a pivotal trial. And we have shown numbers in the past that were higher, that were basically double. And by the way, earlier in the conference, I said binucleated. What was meant is deploy cells, mononuclear deployed cells. That's how these numbers here are reported. In the past, we've demonstrated data that was consistent with multinucleated polyploid cells, and those numbers typically were double what you saw here. That's why you've seen changes from before. And in reality, less than 10% of cardiomyopathies tend to be mononucleated and deployed. So these numbers here are likely under estimates of the true number, but we're being conservative.

Our next question comes from Patrick Dolezal with LifeSci Capital.

And congrats on the data. So in a scenario where FDA doesn't provide a clear-cut acceptance of the use of a surrogate endpoint, do you believe that an argument for accelerated approval on this basis might remain kind of down the line, for example, after clinical study enrollment, but ahead of some of these longer-term functional or symptomatic assessments? And then kind of given the relatively rapid and consistent improvements that we're seeing, especially in these pediatric patients, which include symptoms and function, do you think a biomarker-focused approach is even completely necessary at this juncture?

That's a great question. And as the data study emerges, I might have the same question. I think why a surrogate marker makes the most sense, and I'm not saying that this is the only path forward for us. But for example, if we use protein expression, we know that the natural history of protein expression is zero, right? So it sets us up for a lower bar than any other measure. And as long as we know that the protein expression correlates with the clinical outcomes that you just mentioned, Patrick, then it could certainly be 1, or 1 of the endpoints that we can use for an accelerated approval. Yes. But if we use a clinical endpoint, look at the totality of evidence, that could certainly be supportive. We're not in a position, however, to design a very large cardiology style trial here using a long-term clinical output, such a 6-minute walk test. That's just not in the cards here for a rare disease, especially given that we have pretty remarkable biomarker and clinical efficacy elsewhere.

And then as a follow-up, could you just speak to the presence of patient advocacy groups for Danon disease? And kind of whether these groups might have a role in advocating for the use of surrogate endpoints as part of the pivotal design?

Certainly. So the Danon disease patient advocacy group before we started doing the research was really just the facebook group with a few months starting up with a few hundred patients around the world linking up to talk about science and symptoms, early diagnosis and where they're the best cardiologist available. This has really evolved over the last few years into becoming a Rocket Foundation -- Danon Foundation with support of Rocket, connecting them to national organization for rare diseases, NORD, or other nonprofit organizations. Our thinking is really simple. We -- before we've been designing a Phase I study and putting an IND together, we spent a lot of time with the patients to understand what's important to them from a clinical perspective. So patient voices have always been part of the drug doing paradigm and the thinking that we do. So our goal is to really have patients engaged with help authority and other stakeholders' discussion in order to make sure that we have the most consistent and meaningful clinical study design so we can, 1 day when they get the drug approved, it's labeled in such a way that it actually makes a difference to the patient lives. So they're absolutely part of the equation, and they do get represented and their voices do get represented in help of early discussions, along with other discussions we have broadly with the stakeholders.

Super helpful. Congrats again.

Thank you.

I just wanted to add 1 thing on the prior question, I think it was from Colin around BNP, if I may. I wanted to point out that the drops in BNP you're seeing are in patients who had highly elevated BNPs at baseline and the stabilization you're seeing tends to be more in the patients who had near-normal range BNP at baseline, right? So if you're normal, then you don't need to improve your BNP. So the ones that you're seeing that decrease are usually the ones with the highest BNP at baseline, including 1 of the new pediatric patients. Just wanted to point that out.

Our next question comes from Timur Ivannikov with Raymond James.

So just wanted to clarify in terms of NYHA class improvement, the timing of it. Did the pediatric patients, did they improve after 3 months only? And how does that compare to the adult patients?

Yes. We start seeing improvements in the pediatric patients as early as 3 months. I would say that the adult patients, the earliest we saw improvements was 6 months, but more commonly around 1 year. So it seems like what happens in the adults at 12 months happens in the pediatric at 6 months. But again, the numbers are very small. And I would take all of this with that caveat.

Right. Remember that it may be because they're younger and easier to transduce. It may be because they had a more comprehensive immunomodulatory regimen. It may also be because the pediatric patients had a lot less steroids and a lot faster steroid taper than the adults, which may also enable much earlier recognition of improvements. Either way, we'll keep doing the things that we've done in the pediatric cohort for all subsequent Phase II patients, whether they be adolescent on the younger side or closer to the 17, 18, 19 year old range.

Okay. And then just a quick question about the weights of the patients in the study. I think your pediatric patients are somewhat heavier than 1 would expect for a 12-year old. I mean I think the average weight for 12 year old is about 40 kilograms. Do you think later patients would have any differences? I think you wanted to enroll patients age 8 or older. So those patients would be substantially lighter. I don't know if you've had any discussions with the FDA about this? Or is it normal for Danon disease patients to be a bit heavier than healthy individuals?

Dr. Rosano, I believe, is on the phone. If you were able to hear that question, you can answer since you're closest to the patients.

Yes, sure. I think sadly, they're typical of the general population of children that are more overweight and there's a lot of obesity. So I -- they were, I would say, kind of typical size for what we'd expect for their ages. And so, no, I mean, I personally don't have a concern about smaller children getting dosed or I guess the that they would be underdosed, but I don't -- personally wouldn't have that concern.

Yes. And with regard to the FDA, we've agreed upon a path to be able to dose patients as young as 8 years of age.

Our next question comes from Dae Gon Ha with Stifel.

Congratulations on the data as well. Two quick housekeeping questions and then a regulatory Phase II trial design one, if I can. On the Slide 16, the 2 housekeeping questions are: #1, can you provide a little bit more color around your rationale to providing the grade-based IHC data versus the actual number? I understand it's done by a Core Lab, but the grading system, I guess, is new. And the second housekeeping is on LAMP2. Going back to Colin's question about the VCN, recognizing you're pursuing a more conservative estimate here, but looking at patient 1001, 1002, the numbers are more conservative. But if you look at 1006, you're still at -- I guess, 1.1 compared to the last time you reported month 12 VCN number. So if you can circle that out for me, that would be great. And then maybe for Kinnari, as you think about the surrogate endpoints, again, the rapidity of improvement is noteworthy. So can you maybe speak to how strong the correlations are between the biomarkers that were presented in the staircase slide? Which 1 has the strongest correlation that could, I guess, be most attractive from a surrogate endpoint standpoint? And then if there isn't so much of a gap between the surrogate endpoint improvement and the clinical function, would it even be possible to do like, I don't know, a troponin based surrogate endpoint and then do you like a PDUFA extension type of data supplementation to get 1 swoop of a submission to get the full approval? I hope that makes sense.

Yes. So on the grading, this grading is not just counting cells with positive LAMP2. This grading is an assessment of the distribution and the extent of distribution of LAMP2 across the cell, with the understanding that broad distribution here is what matters. So the grades reflect distribution and extent of protein expression. It's not looking cell by cell and seeing if there's protein in or not, which is how some of the other more detailed quantified assays that have done it in the past. And we think, after having looked at all of the various methodologies, Qupath, which we presented in the past,this grading score, which is centralized in a Core Lab at Texas Heart Institute, and at least 1 other methodology, this one is we think most representative of what happens in Danon disease and most representative of clinical outcomes. So that's the rationale behind the grading system here. And in our discussions with the FDA, this categorical grading system, aligning with the clinical outcomes, sets us up to a relatively simple path for study endpoints and for design.

Yes. Regarding the regulatory component, I think what I would have to say is the Phase I study was really comprehensively designed by our Chief Medical Officer, Jonathan. And what it allows us to know as you've seen the data from today, even a pediatric patient follow-up of 3 to 6 months, we've seen, not only molecular expression, meaning LAMP2 expression change, but we also see an NYHS class change, which tends to happen later and more sustained. So whether it's because of the pediatric patient population or the combination of us getting better and learning with the immunomodulatory regimen that we're providing to the patient or the closely followed activities that are happening at clinical study sites like CHOP, we believe that we can see these changes really link up together. So while our goal for Phase II pivotal study design will be an accelerated approval pathway based on something like a LAMP2 expression or troponin, what we want to do is collect similar type of comprehensive data. And our goal would not be to extend the [indiscernible]. Our goal will really be used in an openable single arm study is continuously evaluate benefit risk in comparison to the natural history. And when we see a change to be dramatic and consistent, we would like to approach the FDA to see if we can submit this product for additional approval pathway.

I wanted to come back also to the VCN point, Dae Gon. The 1002, patient 1002 has had the most dramatic drop in wall thickness over time. And that's associated with these conservative VCN numbers long term of only around 0.5 to 0.6. I would estimate that this patient probably has 1 to 2 copies per cell for cardiomyocyte based on these numbers, right? You have to double that. And I think as long as we're in this range and it's sustained, there is high likely put a benefit to these patients.

Our next question comes from Raju Prasad with William Blair.

Can you just discuss the measurement of LAMP2 expression by IHC versus Western blot? And did you perform the Western blot in the biopsies for the pediatric patients? And if so, what do those look like directionally? And then maybe just -- maybe answer that and I will ask another question.

Yes. So we have performed Western blot where we can. I would just want to remind folks that we have 1 shot at a septal tissue extraction. It's a very tiny piece of tissue. We have to prioritize. We prioritize IHC. We prioritize vacuoles. We prioritized vector copy numbers. Those are the 3 most important. And whatever is left over, we use for other assays like Western blot. So we don't always get Western blot. It was difficult to get Western blot in at least 1 of the pediatric patients because of the paucity of tissue. And that's been true for other adult patients in the past, as you know as well. We don't have multiple shots on goal for these septal biopsies with these children under anesthesia. So that being said though, for the adults, we have gotten longer-term Western blot values and they continue to be positive. In some cases, they even continue to increase over time, and that's an assay that like 6-minute walk test and others, we will probably put out in the future and publish, but it's not instrumental to the thesis here today. And then sorry, the second question, Raj?

Yes. Can you just discuss some of these cardiac structure and function parameters under a transplant setting either NYHA class or some of the BNP and troponin levels maybe at 2-year post transplant. Just curious to know how the data you're seeing stacks up against standard of care at this point?

I think that we don't really have precise BNP or troponin data post transplant. Most of the cardiac transplant patients are going to be Class I or Class II. But it's going to depend very greatly on the degree of complications that they've had from the transplant. I think the most important thing to recall is that for pediatric hypertrophic cardiomyopathy. Heart transplant, you have about a 50% 10-year survival. Transplant is associated with a tremendous number of early, intermediate and late complications. You have a lot of early rejection and arrhythmic problems. And then in the later stages, these are patients that end up with a lot of atherosclerosis, multiple other organ problems. They're on long-term immunosuppression. So it's -- the transplant is not a walk in the park. Typically, after a transplant BNP is going to be low or normal. Troponin isn't usually followed. But the real thing to think about post heart transplant is all of the different illnesses that are conferred by that procedure and the fact that this is not necessarily a long-term cure either of the cardiac or other components of Danon disease.

Our next question comes from [ Cian Hang ] with JPMorgan.

This is [ Sean] on for Eric Joseph. Congrats on the data. So just 1 for -- first 1 for the patient's data presented to date, are they likely to contribute to the efficacy analysis in Phase II registration study? Just want to clarify on that.

Yes. I think that the process, the CMC process is basically the same. We're not changing cell lines. We're not changing the very basics of the process. So we hope to leverage as much of this data set as possible for the pivotal trial. Certainly, the safety, but these are the patients we'll be able to see long-term efficacy as well at the same dose that we're using for Phase II. So absolutely this will ultimately become part of the BLA submission as well.

All right. All right. So on CMC, can you speak to your current planning in production capacity to support the pivotal trial and the commercial rollout.

Certainly. So our CMC, first and foremost, I think a few months ago, a few weeks ago, we had announced that we did have a discussion with FDA on our change from our CDMO Phase I product to what we're doing from an analytical comparability to transfer it to Cranbury, New Jersey, facility. So we have received FDA alignment on that plus potency assay work. Our goal is really -- at this point, we have started our first GMP run in activities. We will have more than sufficient product for patients to successfully be treated throughout the entire Phase II product, both in U.S. and Europe coming out of the Cranbury facility. And then we will be doing stockpiling essentially to get ready for commercialization.

All right. So there is not a number yet, but -- if you do, that will be good to know too.

Definitely. We will have that available leader. I think we see Phase II data will have that available.

There are no further questions. I'd like to turn the call over to Gaurav Shah for any closing remarks.

Thank you for all the questions today. I think that we're sitting on something truly remarkable here for cardiac gene therapy and specifically for Danon patients. And I think this is the first time that we're able to link protein expression at grade 1 with a mechanistic visualization of improvements in vacuoles, together with lab improvements, imaging improvements that ultimately lead to clinical improvement. So there's -- the story here is positive on every single parameter, and that was not what we expected when we started this program with Eric Adler several years ago. So it makes me extremely happy. And I think the next steps here are very clear for us, and we look forward to continuing to hear from everybody here. Talk to you soon. Thank you for coming today.

This concludes the program. You may now disconnect. Everyone, have a great day.

Thank you.