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

My name is Maury Raycroft, and I'm one of the biotech analysts at Jefferies. I'd like to introduce Sandy Macrae, the CEO of Sangamo. Thanks so much for joining us today, Sandy.

A pleasure to be with you.

And for those who may be new to the story, can you provide a 1-minute intro, highlighting your main products and key catalysts.

Delighted to do so. So we have compelling story of clinical products and a remarkable future to come. We're going to talk, I'm sure, about our 3 clinical phase assets, which are either in Phase III or about to go into Phase III in the coming year. We have fabry disease wholly owned with really interesting data that I think is a leading product in Fabry disease now. We're in Phase III Pfizer for hemophilia A. And we are completing the Phase I/II study for sickle cell and hope to take that into Phase III next year. And on top of that, we've already dosed the first ever CAR-Treg patient in renal transplant, a very exciting moment for the company. But behind that, we have portfolio of Treg products and CNS capability with our zinc finger platform that makes us prepared for the future. And all of that is underpinned by wholly owned manufacturing, both here and in France and a platform and an editing capability that we think is second to none.

Got it. Yes, I think that's a great intro. Maybe starting with your Fabry program. So it's your first quarter earnings update, you said you completed Fabry Phase I/II dose escalation, and that additional data is going to be expected in the second half of '22. But we won't see kidney biopsy data until early '23. Can we expect to see alpha-Gal A activity in lyso-Gb3 for subjects 5307 at the 313 dose in patients 8 to 9 at the 5e13 dose, and also longer-term data for patients 1 and 4 -- 1 to 4.

So we're really excited to show whatever data we can. We've now dosed 9 patients, and we're up at 5e13, and that's the top dose. We're not going to escalate further. We only started the biopsy process when we had clear line of sight that biochemically was working. So that was only possible from Cohort 3 at 3e13. We also only do biopsies on patients that are either naive or pseudo-naive because in patients that go ERT, the results will be conflicted. Cohort 3, both patients were on ERT. So the first patients to have the kidney biopsy were the 2 patients in cohort 4. So they've had the biopsy. They then need to come back, they turn the year to have the second biopsy that then needs to be analyzed, which is why we're guiding that, that data won't be available until the start of '23. But I think absent that data, you look at the overwhelming story from the alpha-Gal, from how the patients feel and the safety of this product is really is compelling data. So we have shown between 2 and 15-fold increase above normal for alpha-Gal in these patients. We have no adverse events of any significance at all. The patients feel better, and they say they're sweating again. Now that sounds like it's something trivial. It's not for Fabry patients because it limits what they can do and where they can go, but more important, as a clinician scientist, what it means to me is that the gene therapy, the alpha-Gal is getting into the tissues and resolving some of the tissue problems or damage from the Fabry disease. So I think it's a really good indicator that this is getting into tissues and having its effect. We have anecdotal stories from the patients and their physicians of them feeling better and their cardiac measurements from an MRI are booking, but they're at least stabilized in some cases, improved. So I think this is a very compelling story. When you sold what out their Avrobio did, they were able to show kidney clearance of the Lyso-Gb3 with much lower lysosome than we are showing. So it gives us great hope to be able to talk about this next year.

Got it. And just to clarify for the biopsy. So at least 2 biopsies based on what you have so far and potentially more in...

Potentially more in future patients.

Right. Okay.

And we've also removed 3 -- sorry, 2 patients from enzyme replacement therapy. And just hopefully, other patients will start to be taken off over the coming weeks and months, and will show that data as well.

Got it. And can you say what you're going to be looking for in the biopsies then specifically?

We want to show the clearance applies of Gb3. Now there is a [whole] subspecialty of which cell type that the lyso-Gb3 has been cleared from, that is a deeper expertise, and we look forward to showing that detail next year.

Got it. Is there more you can talk about now as far as the difference all types?

I'm not going to commit myself to that.

Okay. Okay. And recently, you added cohort for at the 5E13 dose. Can you remind what the efficacy was in preclinical models for this equivalent dose relative to the 3 lower doses? And how did the safety compare for 5E13 versus the 3 lower doses in animal models?

So let's start with the safety. The safety in 5E13 has been unremarkable, there's nothing happened at all. We've already dosed patients with [AAV6] in 5E13 in previous studies. So we know that this is a sick dose for our capsid. It's hard to get direct correlation between animals and humans. And I think one has to realize, I confess that only 2,000 patients have been treated with gene therapy across all of the capsids against all of the programs. So there isn't a real clear animal scaling system yet. What I can tell you is in the GLAKO mouse, which is the animal model of Fabry, the higher doses are better. So the higher you go, the quicker there is clearance of the lyso-Gb3 from a variety of tissues. So that's why we wanted to go to the highest dose that we feel is our normal high dose. And we got there through [0.51, 3e and then 5e13]. So we have a body of evidence that's growing for Fabry.

Got it. And can you remind us of the mechanics of how these patients qualify to come off of ERT and how you're going to monitor them since they're of ERT? And are there criteria in place determining if the patient should go back on ERT?

They sold down to their physician because the relationship these patients with -- between a rare disease patient with a lifelong disease and their physician is a very precious one. So the -- we took ironically patient 4 of the RT first and Patient 1 has only been off since the first quarter of this year. And that was because patient 1 was a more fragile patient and the investigator wanted to see the results of this study and hear about the other patient of ERT. But now they've got confidence and they're preparing to take other patients of ERT. When do they go back home, if the investigator has any concern about their health or they see the changes in the results. And so far, so good, no patient has been requested to put on back on ERT.

Got it. Okay. And is there a timeframe that would be meaningful for keeping patients off of ERT. Do you view that as like a 3- or a 5-year timeframe?

I think every month that the patient doesn't have to go to get an infusion. I mean, it dominates their life. They have 5 to 7 hour infusions, perhaps every second week. And it isn't really a pharmacokinetic way that they should be getting the enzyme, they get a first of a bolus of it and then it fades from the system. It is much better to get it as a chronic infusion from the gene therapy. So our patients are showing benefit out to 15, 18 months. And we're delighted by the steadiness of the enzyme levels that we've seen. And I think that [augers] very well for this being a long-term treatment for these patients.

Got it. And that makes sense. And can you talk more about feedback you've gotten from FDA at your recent Type C meeting? And are there scenarios where an expansion phase could then be expanded into a registrational phase, and what will FDA consider in terms of sample size, duration of follow-up and health of patients for accelerated [indiscernible].

I always feel like an advertising agency for the FDA because I think they do a great job and they -- we had a very constructive educated meeting with them. They understand Fabry, they want to make medicines for Fabry. They gave us great advice, which were -- the team are now digesting and planning the Phase III and the plans for that are well advanced. You had the second part of that question.

Well, I guess for the Phase III design, can you talk about some of the specifics for that?

We'll talk about that later. But the other -- the thing you asked was, is it likely that we will do a kind of adaptive design and move the expansion cohorts into PC? I think that's less likely. I think it's most likely that this will be a new Phase III study structuring next year. But we look forward to collecting that data from the expansion cohorts because they give us long-term safety, long-term efficacy and they go into new cohorts. So we're talking about women because women have mosaic form of Fabry, but an important one when you look at cardiac disease and when you look at renal disease.

Got it. And then what are the latest insights from FDA and what endpoints would be required for accelerated approval? And how important is alpha-Gal increase versus lyso-Gb3 decrease? And does FDA have specific thresholds they've disclosed?

They've been very informative in the discussions with us.

Okay. Okay. And I guess, are you seeing anything additional on what those [indiscernible]

No. It's one of the advantages of having had that meeting, it's all the preparation you go for. So that information is precious, and we tend to keep it to ourselves.

Makes sense. What work do you have to do to make sure that you're assessing lyso-Gb3 decrease appropriately, so you can appropriately design the study with the right competence?

Well, I think if you look across all of the programs, lyso-Gb3 only goes down if it was up in the first place, both in our study and in [Avrobios 4D] I believe, the only patients that show a reduction in lyso-Gb3 are those that were already high at the time of entry. So it's a complicated thing. It's a thing we have to remember how few Fabry patients have been dosed with gene therapy. So we're learning with every patient, and we look forward to showing more data later in the year.

Got it. And can you say how FDA is going to weigh clinical measures like improvement in sweating, quality of life and neuropathic pain.

I'm trying not to see what the FDA told us, but I think the essence of what the agency told us is clinical benefit is important. They really want this to be about the patient. They don't just want it to be about a number.

Makes sense. And can you talk about steroid use for the study and for the higher dose cohort 3 and 4 patients. What are you doing to monitor safety? And what dose -- what does the protocol say in case immunosuppressive cytokines.

So we haven't given any of our patient prophylactic steroids. I remember in the hemophilia A initial days, that was prophy steroids was the most commonly asked question. We started dosing our Fabry patients in the time of COVID and made it a decision that giving people in the time of COVID steroids wasn't the wisest thing to do unless you absolutely had to. So none of our patients have had either prophylactic steroids or steroids triggered by a liver function event. So, so far so good, but we continue to monitor the patients closely and measure the liver function frequently.

Got it. And are you saying how often you do that?

No. But we do it frequently and the patients are all well.

Okay. Okay. And what are your latest insights into the optimal patient type you'd enroll into the Fabry Phase III?

I think it may not be possible to have one study to bind them all. I think there are so many facets of Fabry. You have men versus women, you have European treatment versus U.S. treatment. You have patients who are more renally focus some are more cardiac focus. So I think the Phase III protocol will be a carefully crafted program.

Okay. Would you keep the different patients in different cohorts or...

All of those are possible.

Okay. Okay. And in thinking about competition, it seems like you, 4DMTs seem to be moving at a similar pace with enrollment. What are your thoughts on investigator enthusiasm for your program, 4DMT and then freeline's program.

So I don't know what their investigator enthusiasm is, all I can talk about is ours. We -- since we showed the results, it has been an overwhelming number of patients have inquired about the study. We're very pleased we have several women that are preparing to come into the study, we've line of sight of the next patients. It really talks about how different recruitment is once you have good results. These patients are making a big decision. They can only get one treatment with a gene therapy, they have to choose which one they want to go to, and that's why it's very pleasing that they're coming to us.

Makes sense. And for the different competitors out there, including saying, can you remind how programs differentiating from a mechanism standpoint?

So they have different capsids, which I think is important and 4D believes you have to put the capsid into the heart, which we don't believe -- we don't think that's necessary. There's no indication from the animal study sets necessary. And going into the heart, as Freeline found gives you the risk of myocarditis, which I think is most likely to be a capsid thing rather than anything to do with Alphagan. We wish them well. The world needs treatments for Fabry, but we feel that the established safety record of AAV6 both in the MPS studies and in the active hemophilia studies give us a solid workhorse for delivery. Every time you go into a new capsid, you run a risk of things happening. Freeline get myocarditis, 4D get haemolytic uremic syndrome. So safety is the most important thing, and we are delighted with the profile that we've shown so far.

Got it. Makes sense. And then for hemophilia A, wanted to ask a question there. Just on your first quarter earnings, Pfizer Sangamo announced FDA lifted the clinical hold on hemophilia A Phase III and anticipate resuming the Phase III in the third quarter. There was the one DVT event, which you talked recently, but at a competitor event. But I'm wondering if there are any other protocol or monitoring changes that are being implemented when the study restarts in the third quarter.

Yes, and Pfizer are putting that together, Pfizer, preferred that they talk about it rather than their partners, and we understand that. But they are very confident. You have to remember those 2 unusual things over the study. One is the other 50% of the patients to complete the study already known. So Pfizer we're preparing for that in the run-in study. And then most unusually, I can't think of a clinical hold where the patients are still getting benefit. So normally when you get on clinical hold, you lose all the data from the patients that were previously treated here. They still have the gene therapy, they're still being monitored, they're still doing well, they're still getting the benefit of the treatment. So we're accumulating months going into years of data from these patients. And I think that will help us in the long run.

For sure. And BioMarin has had a couple of updates recently. What are your latest thoughts on what FDA needs to for hem A gene therapy approval for Octavian? And if you could speculate what do you think is the key issue that is delaying approval?

I try not to speculate on my competitors. This is an important moment when this drug is approved because it's the largest gene therapy, I think, that has been approved. It's for a significant number of patients that are alternative treatments, and therefore, the FDA needs to take the time and do it well. I'm sure they'll be being asked about the same kind of questions that Pfizer is currently addressing in the amendments that they are putting together.

Got it. And can you remind if Pfizer is going to do another data update from [indiscernible] this year.

That's for them to guide to.

Okay. Okay. And for sickle cell disease, I just wanted to check on that one is the transition from Sanofi is complete or near complete, and you plan on repartnering this program in Phase III?

The transition is nearly complete. We have a great relationship with Sanofi. We have dosed the 5h patient who have guided that we'll dose patient 6 and 7 in Q3. And then look at the data from this new process, which is an increased number of long-term progenitor sales at the beginning of the year. Our intention is to say this forward, this is one of our zinc fingers. It's got a new process. But until we see that data at the start of next year, we won't know how to drive it forward. As always, we have interest in our programs, but we believe this is bite-size as Sangamo sized, and we're trying to get forward ourselves as possible.

Got it. And so patients 5, 6 and 7 has the new product.

They have the new product, and it's nothing dramatic. The process is the product in cell therapy. So the editing remains and remains good. It's just how you look after the cells and the various constituents that treat them and expand them. And Sanofi did some great work on that, and we hope that will result in a clinical benefit.

Got it. Okay. And moving on to your CAR-Treg program and platform, you recently announced you dosed the first patient with a low-dose CAR-Treg. Is there a status update on the patient? How is the patient doing? And what's the next step for dosing the second patient by midyear?

So the patient is doing well, it's remarkable, I mean it really is remarkable what they've done. This is the first time that anyone's taking a Treg, put a CAR on it and put it back into a patient and the patient is doing well. We look forward to sharing results of the patient as the year goes on and into the new year. The patient will be biopsied to part of the normal renal transplant. The patient -- the next patient were guided, yes, to be dosed this year. We hope even to complete the cohort, which would be 3 patients this year. And then we'll talk about this data. We have a whole portfolio of Treg, CAR-Treg type behind that, that are all learning from this program and benefiting from it and benefiting from the safety experience from it.

Got it. And yes, very interested and for the biopsy, can you say if you've collected it yet? And could that be an update by the end of this year?

We think that the biopsy is most likely to be at the beginning of next year that we update you on.

Got it. Okay.

You can't believe the excitement. I have people who have been working at Tregs for 10, 20 years. I have a team in France that have done this nonstop for 5, 6 years, and they are so excited to see that biopsy data and to share it with the world and hopefully show that CAR-Tregs are a new form of treatment for autoimmune disease.

Makes sense. And you have the second patient enrolled and what guides your decision, and when and how to dose the second patient?

Though the process, it's all about their transplant. That's the most important thing is and what governs the timing of when they get dosed. So we have to work around when their transplant is going to be to make sure we [wait] for reason sufficiently early. And then 3 months after the transplant is when we give them back the [cells]. So the timing of it is really down to when their help the donor transplant is. So you can imagine that is something that is out of our control.

Right. Makes sense. But you're anticipating maybe a year [indiscernible].

We've guided that they'll be dosed this year, and I think we see in the third quarter. Okay.

Okay. And let's see. So for competitors in this space, it's definitely picked up over the last year and half or so. How are you positioning your Treg platform versus competitors?

Yes, it's fascinating because when we acquired TxCell, there weren't any other Treg companies. Quell was just a kind of sparkle in his fathers eye, and we -- there's now 15 Treg companies, I believe, 9 CAR-Treg companies. It's great that the field is waking up to the amount of private when they going into this really speaks to how important this is. There are many things that make a great Treg company. One is having great scientists that know about Tregs, and you can look at some other companies like Sinoma, they have people that have done Treg [indiscernible] like, but we have Jason, our CSO, who's really written some of the fundamental work on Tregs, has been working on them for years. But you need other things. You need editing capability, which we have in-house, and none of the others have. You need GMP manufacturing, and we now have cell therapy GMP manufacturing in France and in California. And you need experience. You need to know how to put in an IND. And I think that's the unique advantage that Sangamo has is having all of those things in-house and applied to this important problem.

Got it. And you've mentioned in the past that moving from autologous to allogeneic by editing healthy donor Tregs are creating Tregs from IPSCs. What are your latest plans for this?

Those remain our plans. Now we've -- for the renal transplant study, we've separated the [2 bits]. So the first study is with autologous, but we have an allo to, we call it program, which will be an allogeneic bone. And so we're trying to edit healthy donor Tregs into an allogeneic form. Beyond that, we also have another group, largely based in California that is taking iPSCs and changing them into Tregs, it's wonderful, It's incredible science, and they're making great progress. And that would allow us to pick a single clone make sure it's got all the edits that we want and also reduce the cost of goods and increase the accessibility of the medicine to as many patients as possible. So autologous is something that will be the first wave of TReg treatments, but I think it's very important to prepare for allogeneic.

Got it. And for base editing, can you talk about next steps for that one we can get another update.

That was an exciting surprise, wasn't it? So it speaks to this capability of zinc fingers. So the zinc finger bit is a bit that gets you to the right piece of DNA, and we can target any bit of DNA and give hundreds of options. But then you add pieces on to it and the [indiscernible] did a fantastic job in converting zinc fingers into base editors. Why do you want to be base editor? If you want to imagine it's going in and correcting a mutation [indiscernible] I don't think that's what they'll be used for, because most genetic diseases have a variety of mutations, and it isn't as easy as just correcting one or another. Mostly, they will be used for creating stock [indiscernible]. And knocking out a gene without causing a double-stranded break. So I think that's a useful technology to have. We have other ways to stop aging, and that was another paper we showed at ESGCT, where we can put 3 zinc finger transcription pressers into lentivirus, drop it into a T cell, for example, and we can make it allogeneic by not causing any form of break, but just switching off the genes. And we showed we can switch off, we can create an allogeneic and switch of PD-1 and put in a CAR. So that's the advantage of Sangamo, if you want base editing or a small CRISPR or a Cas12 or someone with IP, you have to go to a different company, and there's now 20 separate CRISPR companies with different things. If you want base editing repression, enhancement, epigenetic recombines as you come to Sangamo and we have the expertise and ability to do all of those. And that's why we do the partnerships with big pharma because they like that they can come and find the right tool rather than having to bet on an individual company.

All makes sense. Sandy, I think we're out of time, and thanks so much for joining us today.

My pleasure.