Sangamo Therapeutics, Inc. (SGMO) Earnings Call Transcript & Summary

Welcome, everyone. My name is Gena Wang. I'm SMid Cap biotech analyst at the Barclays. It's my great pleasure to introduce our next presenting company, Sangamo Therapeutics. On the call with me, we have Sandy Macrae, President and Chief Executive Officer; Sung Lee, Chief Financial Officer; and Aaron Feingold, Head of Corporate Communications. With that, I hand over to you, Sandy.

Thank you, Gena. And let me share my slide, share my screen. It's wonderful how we've all become our own tech in these days. So Gena, thank you very much for having us. It's a real pleasure to be here. I'll just get rid of this. So I want to talk to you about Sangamo. And of course, during today's presentation, I'll be making forward-looking statements, so please refer to our releases filings with the SEC. We're Sangamo Therapeutics. And for us, it's about translating our groundbreaking science into genomic medicines that transform patients' lives. We have wonderful sites and a rich heritage of cutting-edge publications and discoveries. But now we have to make them into genomic medicines. And these genomic medicines can only be applied to diseases that will really make a difference to how the patient lives and survive their disease. We are known as a zinc finger company, but that technology allows us to become experts in gene therapy, cell therapy, genome editing and tumor genome regulation and gives us an array of technologies that have waves of possibility. Gene therapy is about now it's tractable, and it's a valuable near-term opportunity. By taking the cells out to the patient's body, you can edit them ex vivo, and that allows us to move beyond the challenges of delivery. But the future is about genome editing and genome regulation, and we are so excited with our partnerships we recently enjoyed with Biogen and Novartis, which speak to their recognition of the unique technology that Sangamo owns. And these technologies become medicines. They become assets. They become potential to make a difference to patients' lives, which leaves us with the pipeline slide that becomes richer and richer. And I would point to certain things for you. I would point to Pfizer, and they're moving into Phase III for hemoglobin A -- for hemophilia A. I would point to our own proprietary-owned Fabry disease, which is now in Phase I/II. And I would point to the range of preclinical assets that are moving forward steadily, reliably moving towards the point where they will become medicines. And I think many of these are partnered. We are very proud of our relationship with the blue-chip companies within our industry, Biogen; Gilead; Novartis; Pfizer, twice; Sanofi; Takeda. And each one of them has come to Sangamo has looked at our technology and decided that we were the right company to partner for genomic medicines, that we had a unique technology that could be applied to important diseases. We have raised approximately $815 million in upfront from these partnerships. But more importantly, they have brought in expertise in biology, translational medicine and moving these genomic medicines forward into the clinic. Of course, Sangamo will maintain its own proprietary platform. But we do recognize the unique advantage we have from these partnerships. So let's talk about our pipeline. And as I said, gene therapy is known gene therapy is tractable, and hemophilia A is our lead asset. Our friends at Pfizer have released data at the Investor Day in September 15, which shows the levels of hemophilia A, but more importantly, to patients. These patients are not requiring extra factor, and they're not having bleeds, and they're safe, and it's been well tolerated. So we think this is what patients really look forward to. Pfizer have guided that they will show data from longer-term follow-up at ASH. And my view is until we see that data and until we see the Phase III data that will be published when Pfizer have completed the study, we can't really tell the relative advantages of the current players in the hemophilia A field. And so we suggest patients because the data is what will show the benefit of our product. And that moves me then into Fabry disease, which is the wholly-owned Sangamo asset, which has just moved into Phase II. It's an excellent monogenic disease caused by mutations in the GLA gene. And patients have accumulation of Gb3 and lyso-Gb3, which causes damage to their kidneys, to their heart and shortens their lifespan. We think ST-920 offers a potentially onetime treatment for Fabry, delivered as a onetime IV infusion with no preconditioning regime. It will provide them with long-term expression of endogenously expressed alpha-Gal A. With this, we believe, has the potential to the preserve renal function and reduce CAR-T [ hemorrhage ]. The clinical studies that we published recently demonstrate strong expression of alpha-Gal A and Gb3 substrate reduction across all tissue times. The study has started. We have dosed the first 2 patients in cohort 1, and it's 3 cohorts with a low, middle and high dose and will be helped to observe safety by safety monitoring committee because the prime objective of any of these studies is to ensure that the patients are safe and the medicine is well tolerated. We will review the results of this study when the study's dose escalation process is complete at the end of next year. And the kind of things we'll be able to share with you is the pharmacodynamics, the impact of ST-920 and ERT administration, and we'll start to look at renal function. But things like biopsy will come later. And again, this is one where the results of the study will be the most important thing. Moving now to ex vivo gene additive cell therapy in 2020. Our lead assets are in beta-thalassemia and sickle disease with Sanofi. But behind that, we have a partnership with Kite-Gilead who have guided that they should complete the IND for 037, which is the CD19 asset by the end of this year and move into the clinic next year. There are other assets that we are aware of that they're driving forward that aren't disclosed. And then behind that is Treg program, which I think is a very exciting future for Sangamo. Sanofi continue to screen in all patients in the PRECIZN study for sickle cell disease. And together, we've agreed that we will share the data from the long-term follow-up of our beta-thalassemia patients and Sanofi's sickle patients in 2021. We have a very good relationship with Sanofi, and John Reed is fully behind this program, and we're excited to be able to show that data towards the end of next year. Kite-Gilead are moving forward with the CD19. This is a competitive field. And we are very grateful that we have an oncology company leading this. We can do the editing. We can manage the cells. But really, the secret of the success of medicines such as these will be a company like Kite-Gilead that has a good relationship with oncologists and can understand what it is the patients require and move it forward as medicines to patients. Once we had the Kite-Gilead deal, we realized we had a capability in cell editing and we looked for what the next thing was, and we are very clear that T-regs have an enormous potential. And CAR-Tregs, maybe even the next wave of them. Recent work published from the one study and reviewed in an editorial even this weekend in the American Journal of Kidney Disease emphasizes the potential for this kind of therapy. What we like about CAR-Tregs is they're tissue-targeted, antigen-activated, and they give multiple mechanisms of immune regulation. You don't need to know the causative antigen. You need to know the localizing antigen. You need to know the thing that gets you to the kidney or the myelin sheath or the gut rather than what causes multiple sclerosis or Crohn's disease. So our first study is with TX200 for solid organ transplantation. There are about 80,000 renal transplants in the U.S. and Europe. Of these, up to 20% to 25% of them are HLA-A2 mismatched. So an HLA-A2 negative patient gets an HLA-A2 positive kidney, which means that the only piece of their body that is HLA-A2 positive is that transplanted kidney. And so in the STEADFAST study, we'll be giving them HLA-A2-targeted CAR-Tregs that should be localized in that kidney. And then we'll regulate the immune system, promote tolerance and help preserve graft function and reduce graft loss. So study is very simple. Pretransplant, the patient has their T-regs apheresed, and then we edit them to give them personalized CAR-Treg therapy. They then have their HLA-A2 mismatched kidney transplant, and then we return to them their cells, which are personalized for CAR-Treg therapy. This is an important study. The renal transplant patients are carefully monitored. They have biopsies of their kidney. And so that give us a number of pieces of information for the renal transplant patients. They will give us details in safety and proof of concept, but will also answer critical questions from CAR-Treg pharmacology. It will show that the CAR-Tregs are localized to the kidney. It will show that they are activated. It will show that they're -- that they remain and retain that function, and it will act as a gateway to multiple autoimmune indications with large patient populations. And that's why I'm so excited with this because it takes us out of the squabble in the liver for ultra-rare diseases and moves us into a place where we are treating large patient populations, multiple sclerosis, hepatitis, systemic sclerosis, Crohn's disease, rheumatoid arthritis. All of these diseases may be tractable with CAR-Tregs. It really is an exciting opportunity for Sangamo. And let's now talk about genome regulation. We signed significant deals with Biogen and Novartis earlier this year. But what's remarkable about those deals is that both Biogen and Novartis saw the unique capability of zinc finger transcription factors, which are the normal natural form existing in the body. The line to near the promoter of a gene and either interfere with the promoter function, turning down transcription of the gene or encourage that function, and that depends simply on what you attach to the same finger. Biogen has partnered with us an array of targets for neurodegenerative diseases where turning down disease is important. In contrast, Novartis has sought to attack neurodevelopmental disorders, such as autism spectrum. And for them, they want to turn on the gene. In both of these cases, the transcription factors do not require double-stranded breaks, which makes them particularly suitable for use within the CNS. Within the brain, we have a number of ways that we can use our technology to address CNS diseases. What we're talking about with Biogen and Novartis, we call pan-alleleic, which is ZFP-TF for single gene expression and activation and that takes us into Tau, synuclein autism spectrum disorder and many others. We have shown results in the past about allele-specific ZFPs for Huntington's and for ALS, where remarkably, they can turn down the mutant allele and leave the wild type functioning, which is important in some diseases. An exciting thing, we're now moving into epigenetic editing, Rett syndrome, fragile X, where we think we can demethylate and reactivate chromosomes for diseases that have been turned off due to abnormal epigenetic editing. But our CNS portfolio goes further than that. I'd like you to think of our multiple sclerosis with CAR-Tregs as part of that portfolio. And last year, we published a paper with a group in Cambridge to look at mitochondrial disease where CFMs have a unique advantage, they get them into the mitochondria and opens a whole range of mitochondriopathies such as the ataxias and Leigh syndrome that may be tractable to ZFPs. It truly is a remarkable set of opportunities ahead of us. While we've been focusing on the science, my team in Brisbane have been ensuring that we have the infrastructure and manufacturing capability to move Sangamo forward. By the end of this year, which is only a month the week, we will have GMP-approved facility in Brisbane to allow us to manufacture AAV. The team have done a remarkable job to keep us on budget and on time line for this throughout the COVID chapter. But more than that, in Brisbane next year, we will open a cell therapy facility. And in our facility in France, in Valbonne, later in that year, we will also create a cell therapy manufacturing facility. This is important because the CMC process for cell therapy requires a close alignment between the scientists and discovery and the process development scientists in our technical operations group. We can't do this alone, and we're very pleased with our relationship with Thermo Fisher as well as Brammer Bio. And we have dedicated access to AAV capacity there up to 2,000 liters. We're preparing to be a commercial company. And to do that, we need to plan long time in advance so as we can leverage their manufacturing know-how and have a seamless transition between what we do in Brisbane and the early clinical trials and what they will do when medicines meet patients, so it's very important we have this long-term planning and capability. So in conclusion, what I hope I've shown you is that we are a genomic medicine company. We can do gene therapy, ex vivo edited cell therapy, in vivo genome editing and genome regulation. And we're applying each as appropriate to the appropriate disease. Our ZFNs are precise addiction-specific and that we have moved from being ultra-rare disease to a broad portfolio of rare and large indications across metabolic diseases, immunology, CNS, hematology and oncology. We have the manufacturing facility and dedicated CDMO capacity. We have a strong balance sheet and 6 validating biopharma partners. So now it's about delivery. We have the science, we have the capability, and we have the vision and urgency. And I look forward to answering your questions.

Thank you, Sandy. That's a very comprehensive overview and very helpful for a lot of the investors who are not familiar with the stock. So maybe I would just quickly ask, starting with Pfizer's partner program. I promise to only ask one question on that program. So how much we -- based on the data so far, I know it is very early. Sandy, what component you can think of that could make your program, the clinical profile could be different from BioMarin in terms of durability and the [indiscernible] as well.

Gena, I know how important a question this is, not just for you but for patients that have to choose whether they wait for the Sangamo-Pfizer product or make an earlier choice based on the data they've seen. What really pleases us is all with our patients, and it's only 5 patients who one has to be careful and humble about it, but they are not requiring factor, exogenous factor, then they're not having any bleeds. Until we see the Pfizer Phase III data, I think we won't be able to make a complete comparison. And for a time, we show more data. It takes a little longer. And you, I hope, will get more confidence in it. But it will only be the clinical data that we'll turn.

Okay. That's fair. And what kind of learning you can take from hemophilia A program to a Fabry program?

Good point. We know that our vector's well tolerated. We know that you've got to get to a certain level. And it's somewhere about 1e13 that -- 1 to 3e13, I would say, before you start to see good transfection, and that gives us hope. Now the agency will always want to balance the efficacious dose with a safe, well-tolerated dose is the first one. And gradually, I think as we get more and more experience of the -- some particular -- us with AAV6, we hope we will be able to persuade the agency to start at higher and higher doses so as the more patients can get of them.

Okay. And then the data readout end of next year, can you give a little bit color on what kind of data we will be seeing and from how many cohorts? I know it's all data-driven. And also, what level would you consider as the clinical meaning -- what will be your goal to achieve?

So we haven't declared a clinically meaningful vector. I think -- and part of the reason is watching what's happened with others. I think if you look at AVROBIO and life of GLA, they got, it wasn't too impressive, but yet they showed real benefit on Gb3. And I think it says that we don't quite understand -- the field doesn't quite understand what level business is necessary. We're very pleased with the preclinical levels we've seen. We will show data at the end of next year from 3 cohorts, each with 2 patients. And we'll show biochemistry data and basic clinical data. The biopsy data will come later.

Okay. Very helpful. And my last question is regarding the beta-thalassemia sickle cell program. Since ASH update, last year ASH update, what optimizations have you implemented to the zinc finger technology and the procedures to improve durability of the fetal globin levels, especially after we've seen a CRISPR data, like pretty impressive with a similar approach, what you actually pioneer targeting? So like any additional improvement you've done regarding the -- before next data update?

So there's a lot of work going on between us and Sanofi that we can't speak about. We have no worries about ZFNs and the editing capability. We see how well they edit very similar levels to what CRISPR has described. And we think that the focus is around the whole process of apheresing the patient, looking after the cells, making sure that we grow up the cells appropriately and then the conditioning regime afterwards. So there's a whole range of things you can do to maximize the chance that the patients get as much of the edited cells as possible. There is no question in my mind this is not a problem with editing. This is an understanding of the process. And if you look at how long it took our friends at bluebird to get their process to the levels that it is now, it's not surprising that it may take some improvements once you understand the response in patients.

Okay, great. Well, thank you very much, Sandy. This have been very helpful and looking forward to our panel discussion later today. Thank you.

As do I, Gena. Thank you.

Okay. Bye-bye.