Sana Biotechnology, Inc. (SANA) Earnings Call Transcript & Summary

Welcome, everyone, to the 42nd Annual JPMorgan Healthcare Conference. My name is Tessa Romero, and I'm one of the senior biotechnology analyst, here at JPMorgan. Our next presenting company is Sana and presenting on behalf of the company, we have CEO, Steven Harr. Steve?

All right. Well, thank you, Tessa, and thank you, JPMorgan for having us. I appreciate everybody in the audience. So I'm sure everybody recognizes, we'll make a few forward-looking statements. So please do refer to our 10-Q. We spent a bunch of time writing our risk factors. In 2024, I think, really promises to be an exciting and potentially hopefully transformative year for the company. We spent a lot of 2023 preparing ourselves for a bunch of clinical data. And at this time last year, we had no programs in clinical testing. Today, we have four across seven indications. We'll treat something like 40 to 60 patients in clinical studies this year. We'll have data available from every one of them. And during this talk, I'm going to give you a little bit of information that we haven't shared before and why we're so optimistic about where this will take us. We've really focused the company's effort in the near term around a platform of overcoming allogeneic rejection of cells, meaning you put my cells in you, your body is going to reject them. And hopefully, with the technology we have and the progress we've made, we can transplant cells more broadly. And we're doing this in three different broad therapeutic areas today in the clinic. One is in B-cell cancers like lymphoma and leukemia. The second is in B cell-mediated autoimmune disorders, lupus, lupus nephritis, ANCA vasculitis and a whole host of others over time. And finally, in type 1 diabetes. We have a number of drugs coming behind that, which we'll tell you about some other time. And hopefully, we have the balance sheet to allow us to really read out all that we're doing. So this is just a little bit of more detail around our portfolio. The lead drug or the first drug in the human testing is a drug called SC291. It's a hypo immune modified that you're going to talk about in a second, allogeneic CAR T cell targeting CD19. And that trial has been up and going, and I will show you a little bit of data from it. Just last week, we had a drug called SC262 allowed by the FDA. It's target CD19. It's a CAR T cell targeting CD19 is for patients who failed a CD19-directed therapy previously, a big unmet need. In some places, we expect to move quickly. Over the course of the last 18 months, there's been a lot of excitement in the field to get into around the potential to even have curative intent with autoimmune disorders. And we have a drug, SC291 that we're taking forward in a number of these disorders. The IND was allowed in the fourth quarter. And again, you can expect to see data later this year. And finally, we're moving forward in type 1 diabetes as we speak, and we'll get into that. So a little bit around the problem. Since the advent of transplant medicine, the rejection of allogeneic cells has really been a big part of the limitation around broad implementation. And the time is true as we move into cellular therapy. Most have tried to get around it by substantial immunosuppression. That both limits the number of patients who can do this, but has -- and has a lot of long-term toxicities. The fields try to move into autologous cells. They work in some cases. There are only a handful of cells where that's possible and scaling it has been complicated. And all of the efforts to really gene modify allogeneic cells haven't been complete and haven't worked to date. So what's our special sauce? If you take a step back, there are two big arms of the immune system. There's the adaptive immune system of B and T cells. Dealing with that has been relatively straightforward and known for how to do for a while, and knocking out Class I and Class II MHC. Unfortunately or fortunately, tumors and virus has figured that a long time ago. And so we've evolved innate immune system and particularly natural killer cells. And so overcoming the rejection of natural killer cells has been the real challenge of the field. And what we've discovered -- our team has discovered, is that expression overexpression is CD47 in the context of knocking out Class I and Class II gives you the potential to completely evade immune detection, transplant cells with no immunosuppression and hopefully have them live as if they were the patient's own cells. So we've done a lot of work in the preclinical setting. And I'd go so far as to say we've proven that we can overcome allogeneic rejection in mice, humanized mice, nonhuman primates amongst others. And these data are published across multiple journals, including things like science and nature journals over the course of the last 12 months to take a look if you want to go more deeply. On the right-hand side, what you see actually is the transplantation into a nonhuman primate of a pancreatic islet cell. And the goal of doing transplants of pancreatic islet cells is to overcome type 1 diabetes. Our team wanted to do one more experiment as we were waiting for humans, and I want to share that with you. And the goal here is to figure out, can you create type 1 diabetes in a nonhuman primate, never share these data. Transplant allogeneic cells with no immunosuppression and normalize the outcome for the nonhuman primate. So that's the goal. Can we survive and function? Will we get long-term glucose numerization? And actually, at the end of it all, can we eliminate these cells, which is both -- we could do that to validate both our mechanism and a safety switch. So this is with the experiment work. And this is a look at the animals' glucose in their blood. And the green is normal. The white is a little abnormal for first meals, and red is abnormal to give the drug STZ and that eliminates the pancreatic beta cell. And you can see the sugars are -- in the animal are all over the map. Over the course of the next two months, we were able to stabilize the animal with insulin. And at that point, the veterinarians allowed us to try to transplant allogeneic cells with no immunosuppression. And what you see is for 6 months, the animal remained euglycemic, off insulin with no immunosuppression. This is spectacular outcome. The animal was able to, at that point, reinstitute itself in with the colony around it and was thriving. We decided though, there is some risk that maybe the liver -- the pancreas had regenerated. And so our mechanism of overexpressing CD47, we can give an antibody to that and see what happens. So what you'll see is when we gave the antibody CD47, the beta cells were killed and the animal became diabetic again. And on the right-hand side is what you see C-peptide, the measurement of insulin, which goes right along that functional outcome. So a great outcome and about is all you can do now non-clinically. So it's time for us to move into people. As I mentioned earlier, we're going after big markets and large unmet needs. With blood cancers are over 100,000 people per year die in the U.S. and Europe alone. B-cell mediated autoimmune diseases where you have over 5 million patients suffering and type 1 diabetes, which is a global endemic and something where we think we can have a large impact. I'll start with blood cancers. And I think most people here recognize that with the advent of autologous CAR T cells is doing the possibility of curative intent in treating patients. And we've also seen a number of companies try to really scale the capability with allogeneic CAR T cells. The challenge with the autologous has been just patient access in many regards. And despite the fact that 100,000 people die per year, what you see here is this yellow little circle is the number of people who get them per year, around 11,000. And unfortunately, the light blue is the number who benefit from them. So there's still a very large unmet need. Allogeneic CAR T approaches to date have shown that you can get a pretty good early response. But unfortunately, as the patient's immune system recovers and reconstitutes, the cells are killed and they're not around long enough to really lead to a durable complete response. So we're moving forward with a drug called SC291. And what we've done here is we've gene-modified donor-derived CAR T cells using Cas12b. And you see -- we knock out three genes. We disrupt MHC Class I, MHC Class II, and then we stop TCR functions that I can get in right in a minute. We then overexpress the CAR and overexpress -- so we expressed the CAR and we overexpress-ed CD47. And so that's what we do. The real goal is to figure out do we have a drug here. And the first part of understanding do you have a drug is can we overcome allogeneic immune rejection. If we can do that, that's probably 80% on the risk of the program and 80% on the risk of the company, right? That is something that we've seen in nonhuman studies that we are really quite good at. We want to make sure that the animal data translating to people. If they do, can we make great CAR T cells. And that's measured by safety and efficacy of the program early. And then we want to see how does that translate over time into durable complete responses. And finally, we need to make sure that we have a real scale manufacturing process. So these are the data for the first time we've shared. We've enrolled six patients, we enroll about one a month. That's just what you have to do during this time. And on the right-hand side, what you see is that, importantly, the drug has been very well tolerated. To dose escalation study, we started dose level 1 of 60 million cells, are now at 120 million, next will be 200 million. We've had no dose-limiting toxicities. In fact, we've also had not even any grade 1 CRS or ICANS. What you can see is that three of the four patients have had at least a partial response even at these low doses. And two of the four patients are in an ongoing complete response. So the drug is working as we hoped it would on the safety and efficacy side. Stay tuned. We'll have a lot more data as we get through dose escalation, and we're able to enroll patients very -- and treat patients very rapidly, and we'll have a lot more as the year goes on. But as we go through that, the real key question is how does that early data that we've seen in animals translating to people? And one of the bugs of the drug is that when we take donor-derived T cells and we gene edit them, we're really good at it, but we're not perfect. And so the drug is a little bit of a gamish. We have all of the HIP CAR T cells, which have every single gene edit we want to make. But we also have some cells that just express CAR. They don't have -- they haven't knocked out Class I and Class II. And we have some cells where we've knocked out the Class I and Class II MHC, but we don't overexpress CD47. And what's been seen in the field to date is when patients get an allogeneic CAR T cell, they first get lymphodepletion chemotherapy and as their immune system reconstitutes, the CAR T cell is killed, limiting efficacy. So what we want to see here is what we -- on the right-hand side outline is that as the patient's immune system reconstitutes, our fully hyperimmune cells live. And we'll know the immune system is reconstituted because you will generate an immune response against the partially edited cells. So this is the test of doses really work in humans. So what we see is -- what we hope we would see. I'll start with that. On the left-hand side, what you see is in patients who don't knock out their Class I and Class II MHC or not in patients. In cells that aren't knocked out. And this is real patient blood, right? They generate T cells over the course of several weeks that we'll recognize and kill the allogeneic CAR T cell, non-gene modified. What you see in the middle panel is if they knock out Class I and Class II, as you'd expect, T cells don't recognize these cells. And what you see is our fully gene-modified cells. Again, there's no T cell response. T-cell recognition to them and they can live. So next question is antibodies. So how would B cells do? Again, patients will generate an antibody response to cells where you have an intact Class I and Class II MHC expressed, but they will not, if you've knocked it out and they do not to the -- or fully gene-edited cells. The field has seen this broadly. So you've seen a number of companies that have knocked out Class I and Class II, but the drugs haven't worked as hoped. Because the key has been, as you mentioned, natural killer cells. So this next slide is in many regards my favorite slide in the whole presentation. So it's kind of the killer slide. It's a picture of what happens. So this is actual. These are NK cells from patients 28 days after being treated. And what you see is when you have double knockout cells. This is what a lot of the field has done with Class I and Class II, the green cell is the CAR T cell and the rest is the NK cell and very rapidly, the NK cells who are recognize and eat and destroy the CAR T cell. We're often asked, well, what happens if you knock out Class I and Class II and overexpress HLA-E. So we can try that system for you. And again, the patient's NK cells will rapidly recognize and destroy those cells. And what you see here on the right-hand side is what happens to the NK cells and our fully modified CAR T cells. And they bump up against it, but there's absolutely no killing. And this is the most important slide in many regards because it tells you that with real patient blood, real patient samples, we've overcome the large challenge in the field, which is NK cell recognition of these cells. And just to be sure, we said, "Hey, what if there's something else in the blood that might kill these cells." And what you see is against wild-type CAR T cells, as expected, they're dead. Again, that's just an allogeneic cells, my cells into you. If you knock out Class I and Class II, the blood from the patient will kill those cells. But what you see on the right-hand side is our fully gene-modified cells, they really do work. So the drug is working exactly as we hoped it would. And the immune evasion that we saw in the preclinical setting seems to be translating into people. So stay tuned. The early data suggests that we have the safety, the desired immune evasion and the clinical impact that we're hoping to see. We'll have a lot more data as the year go forward, and we'll share it across all of these different parameters. So we're unlikely to do it at another investor conference. It will most likely be at medical meetings. So stay tuned. I want to move next to autoimmune disorders. And over the course of the last 18 months or so, the field has really begun to understand the potential of CAR T cells in this space. That being said, if you go back over the last several decades, people have been targeting B cells with autoimmune disorders, with a number of different drugs. And there are around 70 different indications today, where at some level, there is evidence that depleting B-cells or knocking down B cells will have a clinical impact. Unfortunately, with the antibodies, what you see in the middle point is they're really pretty good at knocking them down in the blood, but they're unable to get to tissue-resident germinal centers. And that's where a lot of the problematic B cells reside. And what we know is that the depth of B-cell depletion across multiple studies really does predict the efficacy in all these diseases. So to date, the best B-cell depleter man has created is actually a CD19 targeted CAR T cell. And about 18 months ago, and I'm sure many of you are familiar with this, Dr. Georg Schett published data showing that you can see rapid improvement and actually just complete responses in patients with lupus. He's now at [indiscernible], presented about 15 patients. You have follow-up over 2 years. And patients are living basically with a complete remission and they are off of all drugs. So it looks to be a durable -- for the first time, you have the audacity to talk about potentially curing autoimmune disorders. And so what we know is that the depth of which you deplete B cells is the imperative factor in making these drugs work. We've actually used this exact same drug, SC291 in cancer patients. And so we can look at the B cells in the cancer patients. And what you see here is that very rapidly, we can completely deplete the B cells. And it's a reason why we're so optimistic about what we're going to be able to do in the autoimmune setting as we go forward. So the trial is going to be across three different indications to start. You can see that between lupus nephritis, extrarenal lupus and ANCA-associated vasculitis is over 500,000 patients in the U.S. and Europe. This SC291 is an allogeneic CAR T cells, the first one in human testing and autoimmune disorders. And it has a number of benefits versus autologous therapies. Probably the most important one when we talk to clinicians, is when a patient has an autologous, it's an autologous therapy, all of them are on some time in immunosuppression. They have to taper off of that before they can get an apheresis. They have to be put back on their immunosuppression why they make the drug that has to be tapered back off. That's very complicated to manage in a clinical setting. Here are the drugs available. We've got a scale manufacturing process where in every batch, we can generate hundreds and hundreds of doses for patients and we can have consistent T cell quality across the program. So this trial is ongoing. The first dose is actually at 90 million CAR T cells. That's higher than where we started oncology. That was something where I think the safety data really allows us to accelerate. That dose is consistent with the dose in the autologous setting, where Dr. Schett saw data in his studies, which is at 1 million cells per kilogram. We have the potential to go beyond these indications rapidly over time. It's a flexible protocol where we can add multiple indications and expect to see some data across multiple of these, where we will hopefully see early safety and tolerability as well as what are the early response rate looks like. And what we're looking for is not partial response. We're looking for complete responses and really seeing the disease go away for these people. So optimistic about where we can go. I mentioned at the beginning, this drug SC262 where the IND was allowed last week. This is a -- as CD19 targeted CAR T cells and CD19 bispecifics are becoming a bigger and bigger part of the treatment paradigm, unfortunately, the number of patients who have failed the CD19-based therapies is growing. And if you look out in a few years and just look at a reasonable estimate for CAR T cells, you can see 7,000, 8,000 patients per year, which would be an addressable market. When a patient has failed a CD19 CAR T cell, they have about a 5- to 6-month expected survival. So this is a bad place to be. Our drug SC262 targets CD22, it's -- and it's a platform. What you can see here is the little blue part. All we -- the only difference between this and SC291 is that little blue part change. It's -- and so we make one change in our DNA plasmid and one change in the release assays, and we're able to really kind of move forward rapidly across multiple drugs, we hope. The CD22 we use has actually been studied in a number of different academic studies at both Stanford and the NCI in the autologous CAR T cell setting. And what it's shown is in CD19 failure is about a 50% durable complete response rate across lymphoma and leukemia. So we're starting the VIVID study is what we call it. It was -- the IND was just allowed last week to give us a little bit of time for site activation. The dose again will be a bit higher than where we started with CD19 at 90 million cells. That is actually consistent with the dose that is used in the -- efficacious dose used in the autologous setting. The primary end point is the dose escalation will always be safety and efficacy -- sorry, safety and tolerability, but we do expect to be able to share data on early patient responses as we move through this year. So that's the next study. I wanted to just switch text for a second and go to type 1 diabetes. Type 1 diabetes is a disease caused when the patient's own immune system knocks out their beta cells. It's a big unmet need with over 8 million people around the world suffering from it. And they have really difficult lifestyle, both in terms of managing the short-term hypo and hyperglycemic episodes but also the long-term complications of the disease. And our goal is really simple. A single treatment with no future insulin, no immunosuppression and normal blood glucose for like, simple to say, hard to do. But it's actually something we believe where the field is teaching us it's possible. So we know and people have been doing this for 10, 15 years that somebody can transplant primary cadaveric islets from a donor into a type 1 diabetic. And in the context of immunosuppression, that patient can remain off of insulin with normal glycemia for years and years. Patients have been out over a decade with this. Unfortunately, product quality is very variable. It's not a very scalable source. And there aren't that many patients for whom lifelong immunosuppression is better than lifelong insulin. The field is beginning to teach us from others that there may be a better source for these cells. And that, that is you can take pluripotent stem cells, make them into pancreatic islet cells in the context of immunosuppression and again, see normalization of blood glucose off of insulin. But again, the problem is, there aren't that many patients for whom lifelong immunosuppression is better in lifelong insulin. So the key to really understand and can we cure patients, we think is can you eliminate the need for immunosuppression. So there are two elements of the immune system we have to overcome. There's allogeneic. We showed you these nonhuman primate data earlier. I think that's something where -- and we've shown you the human data that from the -- another setting that seemed to indicate that the nonhuman primate and preclinical data are translating to people. So the real question now became, can we overcome autoimmune rejection? And this is where the patient's own immune system recognize islet cells. It's difficult to study because there are no islet cells left in the patient. So our team, what they did is they took blood from a type 1 diabetic and did two things, took some of that blood and made a humanized immune system in a mouse. So now you have a mouse that has the B cells and T cells of the patient. Then they gave that mouse STZ to knock out its pancreas. So now it's a diabetic mouse with a human immune system. We took that same patient's blood and reprogrammed back into pluripotent stem cells. And then divide it into two groups. One, we gene-edited with our hypo-immune cells and the other we didn't and then grew them into islet cells to transplant into this mouse. So now you have a mouse that is receiving its own islet, what you have is a person's islets and that person's immune system inside of the mouse. And what you see on the right-hand side is the system works as it should. This is unmodified cells and within a couple of days, the mouse's -- the human immune system will kill those cells and there's Florid diabetes. And what you see on this slide, is that actually, with our gene-modified cells, it works as we hope it will. And so what you see is for the life of the study, the islet survived. They functioned. It's a measure peptide and you can see glucose control from that. So now we've shown in the preclinical setting that we can overcome both allogeneic and autoimmune rejection with absolutely no immunosuppression. So next up, is people. And so just in the fourth quarter of last year, we had a CTA allowed through an investigator-sponsored trial where we will gene modify primary islet cells and transplant them into type 1 diabetes patients with no immunosuppression. And this is a study we're really excited to see the data from. And it's -- we just got our manufacturing license to move forward this morning. So now there's nothing stopping us, and we're ready to go. And what will happen here is they'll take donor cadaveric islet cells. They will be gene-modified and placed into the forearm of the patient. It's a Phase I study. So the first thing we want to see is safety. But really, what we're trying to see is cell survival and immune evasion and the best marker for that will end up being C-peptide level. So all patients here -- so the way our beta cells make insulins to make pro-insulin. And it's secreted in the blood, you secrete insulin and C-peptide. All patients here have no detectable C-peptide. All of the islets or other beta cells are gone. So if you see stable detectable C-peptide over time, you will know that we have survival of these cells in the context of no immunosuppression. At that point, all three of those boxes will be checked right, around what you need for a curative therapy for type 1 diabetes. That saying will nail it. It may take us time. But from a scientific perspective, it's all done. So our goal, what we're doing over time is we're trying to make a hypo-immune islet cells from stem cells. We call that drug SC451. We'll manufacture that at scale and deliver as a single therapy into the arm. And stay tuned that's coming at us quickly. And I think that this program is the one that is probably the most transformative for the company. And it really could change the way we all think about the ability to treat a host of different diseases, cell replacement with no immunosuppression at scale. So 2024 is going to be a lot of fun. I hope it will be very value-creating. We'll see clinical data have a way of playing out, and we're optimistic based on what we've seen. We have a couple of different ongoing studies in different indications in blood cancers. We have a study in B-cell mediated autoimmune disorders across three different indications. And we'll get our first data in type 1 diabetes as the year progresses. And we'll share hopefully information from all of them in the not-too-distant future with you. So look forward to seeing you. And with that, we'll take questions and answers. I think I will be joined up here by a couple of people, Doug Williams, who's our Head of R&D, Sonja Schrepfer, who runs this hyperimmune platform. So much of what you see comes from her brain enhance and her team's brain enhance and Nate Hardy, our Chief Financial Officer. So with that, questions. If you have a question, use the microphone because it is being webcast, and I'm deaf. So those are both problems.

I have a question. So it's a good target, good science. So in -- I have two questions. So in the CD19 CAR therapy, so what's the dose you issue -- in the slide that you issue 20 million, 60 million. This is total dose or the per kilo dose?

Can you say the last part again?

The cell dose you issue in the slide that's 20 million, 60 million. So these are total dose in a single injection or is this per kilo dose?

So the dose is based upon CAR-positive cells.

Okay. So it's total positive cells.

Yes. So it's total dose of CAR-positive cells. It's how all CAR T cells are dosed, right? And so if you look, most of the approved CD19 that -- all the approved CD19 CAR T cells, the dose is somewhere between 100 million and about 150 million cells. When you start with these donor-derived cells, these are healthy individuals who give them to us. So they could be more potent. They may not be. So we started at 60 million for safety, went to really the range of 120 million, which is kind of in the range of the approved cells, and we also have 200 million cells around that. Doug, anything to add to that?

No. I think you covered it well.

Okay. The last question is what's your manufacturing time for to make those cells?

I'm going to start that question doesn't really matter, right? Because you're used to the autologous CAR T cell where the patient takes -- has an apheresis, I think the patient has the first -- there's a pen, right? The doctor says, I'd like to give you the drug. They then try to find an apheresis center where they take off the white blood cells, send them to a factory, manufacture them, test them and send them back. What we're doing is we make these off the shelf. So the patients -- these -- the product is available today. If the patient comes in and says they're ready for a prescription, it is on the shelf and ready today. And so the manufacturing time lines are generally pretty similar to an autologous cell, but it doesn't matter because we can have 1,000 or 10,000 patients of drug products sitting in the background. We do do a bit more testing because we do a lot of gene editing than what's done on an autologous cell. And so I think we can hopefully offer physicians and patients more comfort around the predictability and the safety of ourselves. But just to give you a sense at that middle dose, 120 million cells from a single manufacturing run, we make enough drug to treat about 500 patients. And to put that into context right? Yes. So if you make 100 doses of an autologous CAR T cell, you can treat 100 people. If we do 100 doses of our drug, we can treat 50,000 people. And that's a totally different scale. We'll go here and then there's one in the back after that.

How do you compare the kind of editing efficiency of Cas9 versus Cas12b in your early research?

Do you want to take that, Doug?

Sure. Can you hear me okay?

Yes.

Okay. I think 12b, one of the advantages is that the editing fidelity that we're seeing is actually quite high. Relatively, I'd say, probably higher than Cas9. And I think we've now had the benefits of being able to actually make several batches of drug and be able to go back and do the analytics on that. So we're feeling actually quite good about the editing fidelity that we're seeing with the reagents that we've developed, and we've now got a data set that continues to grow to back that up.

Okay. Doug, when we did this, we had four criteria. We wanted potency or efficacy, specificity, which gets to safety GMP manufacturability and freedom to operate, right? Those are kind of before you got to deal terms. So one of the unique features of Cas9 versus -- so one of the big problems on specificity, there are impurities in your guide RNA for Cas9 because they're manufactured from 5 Prime to 3 prime and it's the 3 prime end biased DNA. So that last bit can be a little unstable. And when that's not quite exactly what you think, it could bind anywhere in a patient's genome. The way CAS9 works is flipped. And so it's the initial part that binds to the patient's DNA. And so if it doesn't -- if you have impurities in the product, you end up just not binding the Cas. So that gives you a much higher level of specificity. But the second element that Doug didn't get into is the Cas9 intellectual properties that I think, as most people recognize, it's kind of messy, right? And it sits in different geographies in the world with different entities. One of the nice things about the Cas12 intellectual property state is it all resides in a single party. We license it from that single party. And that gives us, we hope, global ability to take these drugs everywhere in the world over time.

And my second question is, so for like CD19, I think CAR T treats resistant patients, some lost CD19, how do you like deal with those patients? They lost the target.

Screening for the antigen upfront. And certainly, in the CD22 case, there's evidence of that happening in that situation as well. So we'll obviously confirm that the patients have the antigen first.

There's a question in the back.