Solid Biosciences Inc. (SLDB) Earnings Call Transcript & Summary

Welcome, everyone, to the 40th Annual JPMorgan Healthcare Conference. My name is Anupam Rama. I'm one of the senior biotech analyst here at JPMorgan. I'm joined by [indiscernible],Carol Smith, Malcomcuno and Priyanka Grover from the team. Our next presenting company is Solid Bio. Representing on behalf of the company, we have CEO, Ilan Ganot. [Operator Instructions] With that Ilan, take it away.

Thanks, everybody, for joining today. Thanks, JPMorgan. Thank you, Anupam, for hosting us. I'm excited to review solid progress in 2021 and discuss our key priorities for 2020. We'll also share some new technologies that we're excited about and have been working on to help improve the lives of patients. On Slide 2, please note that we will be sharing some forward-looking statements, and I highly recommend a thorough read right after we wrap up. On Slide 3, we're looking at a quick history of the company. As many of you know, my wife, Annie and I and our partners founded the company in 2013 after our son Eytani was diagnosed with Duchenne muscular dystrophy. Because of this personal connection, the patient experience is especially important to us, and we collaborate closely with the patient community and many experts in the field. In 2016 and '17, we established our focus on gene therapies, created our lead candidate, SGT-001 and built a meaningful preclinical package. In 2018 and '19, we initiated IGNITE DMD and dosed our first 6 patients in a dose-ascending study. In 2020 and 2021, we released our first clinical data and formed new collaborations that leveraged core areas of expertise to broaden our reach into Duchenne and beyond. We've come a long way, and I'm excited to talk about our priorities for 2022 and where we go from here. Slide 4 highlights our key activities for 2022. First, SGT-001 remains our top strategic priority. We will continue to safely dose patients advancing towards an end of Phase II discussion with the FDA. We will also release new biopsy, clinical and functional data from patients treated with SGT-001. Second, we will move our next-generation construct, SGT-003, closer to our goal of an IND submission early 2023, beginning at pre-IND discussions with the agency and releasing new preclinical data. Finally, we plan to expand our pipeline and launch another program later this year. And all of this will be supported by the strong financial position with more than $200 million in cash, a runway extending well into next year and the right team and infrastructure to execute our strategy and support the expansion. Now I've given you the big picture, I want to take a deeper dive into SGT-001 and IGNITE DMD. Slide 6 provides a short introduction to Duchenne. As you may recall, the dystrophin gene, which plays a critical role in stabilizing muscle, is not present in our patients. We, therefore, deliver a functional shortened version of the dystrophin gene known as microdystrophin, seen on the bottom half of the slide. Our version of microdystrophin is differentiated because it retains key dystrophin functional domains and also includes our proprietary nNOS binding domain, which is associated with preventing muscle injury. To get a bit more granular, on Slide 7, we highlight that based on both animal and human data, the role of nNOS is to increase blood flow to muscle, helping muscles recover from injury. You can see on the left-hand side of the slide, images of nNOS expression and localization in muscle. And on the right-hand side, data suggesting improved Becker muscular dystrophy phenotype in the presence of nNOS expression. We believe nNOS brings a meaningful additional benefits to patients and is a key differentiator of our gene therapy construct. Turning now to Slide 8 and IGNITE DMD, our Phase I/II clinical trial. Many of you are familiar with the trial, so I won't go into a lot of detail on the inclusion criteria and endpoints. To date, we have treated 9 patients with SGT-001, our ninth patient was safely dosed last November. The trial was designed as an ascending dose study and we are currently planning to dose all additional patients at 2 x 10 ^14 vector genomes per kilogram. I'm going to start with safety on Slide 9 because it's our number one priority. To date, the most common drug-related clinical adverse reactions were nausea, vomiting and fever, all of which appear in the days immediately following the gene therapy administration and are not unexpected with such a treatment. We also saw complement activation in all subjects, resulting in three serious adverse events, all of which are fully resolved. We continue to monitor our patients. They're all doing well, going up to 3.5 years after dosing. Slide 10 highlights the work we've done over the past 18 months, taking multiple steps to enhance patient safety. We've worked very closely with our Data Safety Monitoring Board, many experts in a number of related fields, including Duchenne, gene therapy, complement activation and more. Most recently, we introduced an updated risk mitigation strategy, prophylactically administering eculizumab, to inhibit complement activation and increased post-treatment patient monitoring. We also introduced a second-generation manufacturing strategy that reduces total viral load by nearly 50%, while ensuring high product quality. We did that by eliminating nearly all the empty capsids from the drug product. I'll now share our efficacy data from patients treated with SGT-001, starting with Slide 11. We've now collected significant amounts of data on SGT-001. And we believe the data are not only compelling, but also suggest sustained, meaningful long-term benefit across a variety of biomarker and functional outcomes. Here, we're looking at the results from biopsy samples taken from the vast lateralis muscle. Due to COVID, some of our biopsies were delayed, and we are now in a unique position of being able to present an expression and localization of microdystrophin up to 24 months after administration. What we're seeing here are significant levels of expressions for patients 4, 5 and 6 measured by western blot and immunofluorescence as well as better sarcoglycan expression and nNos localization in patient 5, which is representative of all. We'll now switch to clinical and functional outcomes in our study. Slide 12 shows data from the 6-minute walk test and the North Star Ambulatory Assessment for those same patients 4, 5 and 6 were on average 8 years old at the time of their dosing. Our data compared to published natural history studies as well as our own age-matched controls. In both 6-minute work and North Star assessments, our patients are seeing general stabilization compared to natural history out to 1.5 years post dosing. The data on Slide 13 demonstrates consistent improvements across pulmonary function tests compared to baseline and natural history again. This is important because pulmonary function impacts nearly all Duchenne patients, patients often succumb to cardiopulmonary failure as muscle cells in the diaphragm and the heart deteriorate. At 1.5 years post dosing, patients in IGNITE DMD saw, on average, a 16% higher forced vital capacity compared to natural history and nearly 19% higher peak expiratory flow compared to natural history. Finally, on Slide 14, we look at patient-reported outcome measures. PODCI is a validated outcome using questionnaires that are completed by patients, parents and caregivers and try to capture day-to-day outcomes and behaviors. Again, we saw improvement in patients 4, 5 and 6 that support the potential benefits in an ambulatory and pulmonary functional assessments. Compared to natural history, patients dosed with SGT-001 scored an average of 18.6 points higher on a PODCI scale, covering a range of activities from transfer, basic mobility, sports and the like. To summarize, these are early data, but it's promising, and we think our drug is working. Slide 15 shares our plan for this program in 2022. We will continue to dose patients and IGNITE DMD to learn more about risk benefit profile of SGT-001 with the updated risk mitigation strategy we recently implemented. At the same time, we're beginning to look at additional patient populations as well as a pivotal trial to support registration in the U.S. and Europe. We're also planning our all natural history study to improve our clinical understanding of Duchenne. And finally, we're exploring alternative immunosuppression strategies for future clinical studies. We look forward to sharing more details as those become available. Let me now turn to our second Duchenne pipeline program, SGT-003. I'm excited to report that this next-generation program is moving rapidly to the clinic. You can see on Slide 17 that we are leveraging learnings from SGT-001. We packaged our differentiated microdystrophin with the nNos binding domain in one of our novel capsids, which, when compared with AAV9, has demonstrated increased by distribution to the targeted muscle, along with decreased levels of expression in the liver. The goal is always to increase delivery to the muscle, while reducing total viral load and the overall immunological burden. As I will show you in a moment, early preclinical studies suggest that SGT-003 can do just that. The product will be manufactured using transient transfection with our partner in Ohio, Forge Biologics. We're using this process for the first time because we believe it's the fastest way to get to a human proof-of-concept with SGT-003. Slide 18 shows the early preclinical data I referred to a moment ago. Mice, that received SGT-003 with the novel capsid, had significant increases in biodistribution to targeted muscle with decreased levels expressed in the liver compared to mice treated with AAV9. These improvements correspond to similar increases in actual microdystrophin expression evaluated by immunofluorescence. As you can see, mice dosed with the novel capsid also have the lowest CK levels providing further evidence of increased muscle stability. IND-enabling studies and manufacturing activities are underway, and we will begin discussions with the FDA this year to support an IND submission early in 2023. We'll now switch to discuss our new platform technologies, starting with our novel capsid library, from which the vector behind SGT-003 was selected. On Slide 20, we show that our goal with the novel capsule program was to improve muscle expression and reduce total viral load. Our team spent years trying to improve on AAV9, and this is the result of those efforts. As you can see on the right-hand side of the slide, biopsies from the novel capsid show considerably more expression than traditional vectors. Not only that, but the results we saw compared to AAV9 appear across multiple DMD salines. With these results in hand, on Slide 21, we wanted to see if we could replicate this data outside of the microdystrophin construct or a muscle disease. To look at that, we packaged the reported gene [indiscernible] into our novocapsid and administered it to MDX and wild-type mice alongside AAV9. Our CSO, Carl Morris, called this the glowing mice experiment. In the novel capsids, we saw a significant improvement in muscle propism, the amount of vector getting to and expressing in the muscle, along with a decrease in amounts that go to deliver. This is important because a lower viral load in the liver could have safety benefits. These differences in expression in wild type and MDX mice, create an opportunity to use these capsids in other indications in addition to Duchenne. We will continue to research to better understand the potential of these capsids and expect to initiate our first NHP study later this quarter. On Slide 22, we share a technology that we've never spoken about before. In multi-organ system diseases, such as Duchenne, there's an opportunity to address more than one problem with a single treatment. So we developed a technology that allows us to package 2 transgenes into one vector. We call this dual gel expression or DGE -- Here on the right-hand side are two of the multiple ways this technology can work. First, you can have 2 transgenes each with their own promoter or you can have a single promoter that activates both transgene. Slide 23 is an initial proof-of-concept study using a well-established antifibrotic microRNA. You can see some of the data on the left-hand side of the slide. We developed a DGE construct, again, dual gene expression construct that packaged our microdystrophin and the micro RNA into a single vector and administer it to separate groups of MDX mice. As you can see on the right-hand side, we saw levels of expression with our microdystrophin and the antifibrotic expressed by the DGE similar to those you would see if you administer these two therapies separately. While it's early, we're excited about this technology and the data that we've generated and the potential to address more than one challenge with the same administration. Overall, we intend to use these technologies to expand our pipeline as well as consider additional partnerships to bring meaningful treatments to patients. And so we are excited about the future for solid and most able for patients and their families. On Slide 25, we summarize progress made in 2021. We advanced our lead program, SGT-001. dosing patients 7, 8 and 9 and presented long-term biomarker and functional data. We launched SGT-003 and supported our collaboration with We developed promising new technologies that will enable us to further expand our pipeline. And I also want to mention an exciting public private partnership we launched with REGENXBIO the Pathway Development Consortium. The PDC was created to bring together some of the best experts in industry, academia, research and regulatory bodies to advance therapies to patients with rare disorders as quickly as possible, making use of the accelerated approval pathway, led in part by Annie Ganot, Solid's Co-Founder and Head of Patient Advocacy. The PDC has already published two white papers and is working on a third, which will be focused on Duchenne. These types of public-private collaborations are important for the entire field and they help us create healthy dialogues to better understand and more successfully advance therapies for patients. We're proud to be a part of this effort. On Slide 26, I want to close by reiterating our catalysts for 2022 and beyond. SGT-001 remains a top priority. We will continue dosing patients with the goal of closin IGNITE DMD this year to enable an end of Phase II discussion with the FDA. We look forward to releasing additional biopsy, clinical and functional data from IGNITE DMD. We plan to move aggressively with SGT-003 to an early 2023 IND submission with the release of additional data as well as pre-IND discussions with the agency. We're focused on expanding our pipeline and plan to launch another program this year, and we're going to achieve all these priorities with our strong financial position, our team and our infrastructure are in place. We're excited about 2022 and look forward to sharing more in the months ahead. With that, my colleagues and I will take your questions. Thank you very much.

Ilan, if you want to take just a quick second and introduce the broader team on the line, we can get started.

Absolutely. So joining me today are Roxana, who is Head of Clinical Development; Carl Morris, who is the Chief Scientist; and Joel Schneider, a solid Chief Operating Officer. All doctors, of course, except for me.

So Ilan, I wanted to clarify a point. You said that additional patients, I think the guidance was to start dosing at the end of last year. And then I think in your presentation, you said those four more patients, is that right?

No, we did not quantify how many patients we are planning to dose. We did resume dosing in November with patient 9 and will continue dosing patients in 2022.

Okay. Got it. And so maybe you can walk us through some of the time lines here in terms of you broadly guided to 2-year data and functional data from four patients -- 4 thorugh 6 and some biopsy data from 7 through 9. Are those going to be independent disclosures? Or is it going to be a totality of the disclosure at some point in '22 at a Scientific Congress or otherwise?

Joel, do you want to take that?

Happy New Year. Fundamentally, we'd like to provide a holistic overview of how the program is developing as possible. And you can imagine that similar to our previous disclosures, our idea will be to inform as many stakeholders as we can at a single point. So while today, we can't commit to whether or not the biopsies and functional data will be shared together or whether or not it will be a scientific conference. If you look back at our previous disclosures over last year, where we had four different clinical presentations, you can imagine we may want to follow a very similar trend.

One of the quick questions that we get is kind of where this nNos differentiation with SGT-101 ultimately plays out in the [indiscernible] as now you're getting more and more longer-term data, how do we think about that?

Fundamentally, we're really excited by the totality of the clinical data that we've shared so far. And in fact, we are still the only company developing a systemic microdystrophin gene therapy to share some novel outcomes like pulmonary function now up to 1.5 years post-dosing as well as patient-reported outcomes. When looked at collectively, all really reinforced the benefit that we see. But I'll hand it off to Carl to walk you through a little bit about how we think about nitric oxide production and differentiation based on what's been observed in the clinic with other populations and how we think about moving forward. Carl?

Anupam, so what we've been able to show so far is on the slides and the histology we've been able to show that we have active nNOS activity with the appropriate localization. So what that means is that physiologically, we should be able to increase blood flow through nitric oxide production. And so what we're working on in the background really is to identify both in Becker's populations as well as look at novel methods to identify physiological changes associated with nitric oxide like blood flow and other things. There are many activities going on in some of the academic groups where some imaging techniques are evaluating different aspects of blood flow. And therefore, and how that translates into fatigue reduction of fatigue in this sort of functional ischemia. So we're looking to identify those physiological changes and sort of present those at the appropriate time.

We have a question in the question portal is, do you have any views on, given the similarities of Pfizer and your construct about the patient death that they observed and it doesn't seem like they're enrolling patients, is that a risk to your guys' program essentially that there may be safety concerns that derail the program in terms of another clinical hold or something like that?

So we think, of course, that the death that happened in the Pfizer study was incredibly unfortunate. And I think if anything, over the last few years, we've seen how adept and how nimble and flexible we need to be as we think about how to ensure patient safety throughout dosing. Of course, it's early following the patient death and Pfizer hasn't yet shared a lot of information. But we feel confident that we continue to reinforce the safety of our program through some of the novel strategies that we're using in the clinic and feel very confident in our path to continued dosing this year towards the lens of an end of Phase II discussion.

Yes. And I'll just add. I'm not sure if the relationship between now transgene and Pfizer's is that unique. I think they're all quite equivalent. So there would be sort of an overall evaluation needs to happen by all programs. I don't think that ours is any closer to advisers than anyone else.

You talked about in your presentation an end of Phase II discussion this year, right? And you've also talked about 003 IND being filed next year. I guess, competitively, given where Sarepta is, given where Pfizer is, and -- why not bring 003 forward as kind of the lead? It's a molecule. It doesn't have any history behind it with clinical holds or anything like that and just bring forward a new, let's call it, the next gen or 2.0 here and bring that forward strategically.

We're really excited about SGT-003. And I think that the early stage data demonstrates that it's a very promising novel capsid and that the preliminary in vivo data supports meaningful differentiation from SGT-001. At the same time, as we aggressively move forward through preclinical development, IND-enabling studies and all of the process development that's associated, that program still needs to be derisked, as you can imagine, despite the excitement and the confidence we have in it. We think SGT-001 has already shown meaningful differentiation in the clinic. We're now sharing 1.5 years long and will share 2-year functional follow-ups, showing that the construct is meaningfully active in patients. And we think it's the fastest drop forward for the company. It doesn't mean that SGT-003 won't benefit from all the learnings associated with SGT-001. And as that program advances, we'll continue to be nimble and flexible, but we are excited by SGT-001 and we look forward to continued dosing. And we do think it's a meaningful path forward towards the BLA.

With what you've learned from 001 and -- 9001 from Sarepta and the Pfizer compound, which has a super long name and numbers behind it. What are the pockets of unmet need, you think that a next generation could really try to address?

Well, Carl, why don't you talk a little bit about the biology that we've seen so far and Roxana perhaps you can tie it into total viral load and overall safety assessments?

Yes. I mean, I think there are a lot of patients out there that will need the heavier patients we sort of need to be treated as well. And so getting in with a differentiated constructs like SGT-003 would allow it with a lower dose, potentially to get in and treat those patients as well. I think all three constructs appear to have some biological benefit, and we are very sort of happy and comfortable with what we're seeing now after 18 months. So we continue to dose and collect more data as will every other company. And then as we sort of transition, we'll look at SGT-003 mid next year when after our dosing and we'll see what happens with that. Roxana.

As Carl and Joel mentioned, I think there's still a huge unmet need and being able to advance a program that would give us the opportunity to maybe reduce the dose, and therefore, the total viral load would be of great benefit in terms of the safety profile. So -- and in terms of the unmet need in Duchenne, obviously, there is all these other populations that haven't been included in gene therapies peridental now. So multiple opportunities to expand and look into older [indiscernible] connections, even as your positive patient took a different new suppression regimen. So a lot of other opportunities and unmet need in the [indiscernible] to be looking at.

And bob, maybe I'll just jump in with one other piece, which is not often discussed, which is the cost of manufacturing of these products. There are some economies that can support the kind of pricing that is going on right now in gene therapy. But, as companies, we always believe our duty is to continue to innovate and to try to drive a number of improvements, including lowering the cost of production and improving the technology to manufacture these things. There's many more patients than just in the United States and some parts of Western Europe. And even Europe is struggling right now with some of the gene therapies that are trying to enter. So I think something like SGT-003 novel capsids and a lot of other colleagues of ours also working towards kind of better transduction into different target tissue, could be the evolution off of the cost curve. That's really important long term for distribution and access to these treatments.

Perhaps for lasting on, I'm sorry, we think a lot about this program. The capsid library that is supporting SGT-003, for us, is a bit of how we think about our flagship corporate expansion and how we think about tackling additional adjacent diseases with severe unmet need. And so as we think about the SGT-003 program and the derisking that it's going to go through throughout this year, it's going to open up a lot of significant avenues for us to begin to test the waters and expand our overall pipeline. It's the same with our dual gene expression platform where we're going to meaningfully use that to begin to think about how we expand our corporate view.

And maybe a final question for me here which is, $200 million plus in cash, what milestones are covered with that cash and in terms of potentially moving into a pivotal after your Phase II -- end of Phase II discussion?

So our cash takes us a really long way. It takes us through concluding IGNITE DMD. It takes us through all the process development and manufacturing efforts to ensure that we have a Phase III appropriate manufacturing strategy that will also be used initially commercially. It also takes us through bringing SGT-003 into the clinic, and it also helps us accomplish our other strategic priority, which is continued pipeline expansion. So we feel confident that right now, our cash will get us through these key important milestones, and we'll continue to look for catalysts that drive continued strengthening of our balance sheet.

All right. Ilan and team, I want to thank you guys so much for the time. And thanks so much for a super productive session.

Thank you, Anupam.

Thank you.

Thank you.