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

All right. Welcome, everybody, to the JPMorgan Healthcare Conference. My name is Anupam Rama. I'm one of the senior biotech analysts here at JPMorgan. I'm joined by my squad, Priyanka Grover, Malcolm Kuno and Rati Pinge. Our next presenting company is Solid Biosciences. Presenting on behalf of the company, we have CEO, Bo Cumbo.

Thanks. So just forward-looking statements. Please take a moment to look at the forward-looking statements on the website -- on our website, the deck is live. We make a number of forward-looking statements, and so please take your time to take a look at it. Before I dive into it, I'll tell you a story that's happened in the last couple of weeks. So 2 years ago, we set out on a very bold mission at Solid. Two companies merged together. We wanted to create what was the one of the best and largest precision genetic medicine companies focused on neuromuscular and cardiac diseases, really putting together -- as well as change delivery for gene therapy forever with the tools, with the capsids, promoters, enhancers, manufacturing purity and then get those tools out to the world. And the first call I got 2 years ago -- actually, it was 2 years and 1 month ago was from this man sitting right here, Anupam. Well, I was sitting on the airplane when he gave me a call. He was really excited about the merger, and I told him about what we were going to try to do. And he said, that's great. Can you hurry up and do this and this and this? I said, I need 2 years. And that's where we left it. I need 2 years. Last week, we announced our second IND for Friedreich's ataxia, an IND that I believe is going to change Solid as well as the FA community forever. And Anupam called me and we talked a little bit, and I reminded him of our conversation 2 years ago, and he said, yes, Bo, but that was 2 years and 1 month ago, and so you missed guidance. And I was like -- and that sums up the market and where everything is. But we're very excited. I'm very excited to tell you about the company. I think it's one of a diamond in the rough that's really -- has a fantastic opportunity not only to change patient lives and help numerous people, but also for investors for a great opportunity. As I mentioned before, we're really in three areas: cardiac, neuromuscular and delivery, delivery is capsids, regulators, promoters. We will talk about immunomodulation. We're going to spend a little bit of time on that today. And we're very excited. We have Duchenne drug that's in the clinic, and I'll go to the second slide here. Duchenne drug that's in the clinic. We believe this is the next-generation Duchenne program that I'll talk a little bit about. And then we have FA, and FA is a revolutionary drug. And what we're trying to accomplish is leave no patient behind and spend some time. But the cardiac pipeline is really coming on as well. And we're very excited. We're going to have another IND by -- hopefully, by midyear, if everything goes well, knock on plastic here. And we'll talk a little bit about that. But then the emerging pipeline behind that is really pretty robust. For a little company, $130 million market cap company, this has got to be one of the most robust cardiac and neuromuscular pipelines in the business. So let me just give you the top highlights of the company, some corporate update, and then we'll dive into the details. We've dosed 4 patients now, and we've dosed them all safely, no SAEs, very excited for these families and these little boys and they're doing well and hopefully being normal little boys running around and playing in. Very excited about this program. We've now opened up, changed our INSPIRE Duchenne trial protocol. So we're dosing kids anywhere from age 4 to less than 12. We're going to really focus on the clinical benefit from the 7 to 12 years of age, but we're going to gather patient safety data and expression data in the other population, so 4 to 12. I mentioned our Friedreich's ataxia program, very excited about FA. I'm going to talk a lot about this. The IND was announced last week coming into this conference. And I do think it's going to be a game changer, not only for patients but for Solid. Our cardiac pipeline is emerging as -- and I believe it's one of the most robust cardiac pipeline in precision genetic medicine in biotech period. And we can talk about this. We just did another deal with Mayo Clinic as our partner of choice. We have 6 additional programs coming on with Mayo Clinic. But our first program is right around the corner, CPVT, and I'll spend some time there. And we have TNNT2. We've now put a line in the sand on TNNT2. And that's going to be our fourth IND in really the next -- in 2 years, 2.5 years. So we're excited. And I talk about our capsid library. Really, it's not just our capsid library, it's all the delivery tools that we have coming on. And this year we'll have multiple capsids coming into our hands that we plan on getting out to all the small biotechs who want them as well as all the academic labs. So let's dive into our neuromuscular programs, and we'll start with INSPIRE Duchenne. This is our next-generation Duchenne microdystrophin program. We are now in 6 clinical sites in North America, 5 in the U.S., 1 in Canada. And we've also filed our CTA that's approved in the U.K. We filed our CTA in Italy. That will be -- should be up and running first half of this year as well. We are now an international company, really for the first time. And by the end of this month, we will have dosed our first international patient. And that's very important because when we start talking about Duchenne and we talk about accelerated approval, we are going to be going for accelerated approval in the United States, we also want to have a confirmatory trial, double-blind placebo-controlled trial ex U.S. up and running at the time that we're going to the FDA to talk about accelerated approval. So being an international company and having our first site and having our first patient open and dosed, I think, is very important. And that is a milestone for all the Solid individuals who are listening to the call today. Congratulations to you. We are now an international company. And by the end of this month, we would have dosed our first patient ex U.S. We've dosed 4 patients as of January 1, and all patients are doing well, no SAEs, and they're acting like normal little boys and more to come on that. We're going to look at our initial safety and expression data and biomarker data in Q1 of 2025. To be more specific, it's about 6 to 8 weeks from now. And that's where you should expect that data roll out. All the tissue for the 3 little boys, they were batched, they're now being shipped out. We took the biopsy for patient #3 early January. And -- that's because his biopsy was originally scheduled on December 25, which was Christmas. Obviously we pushed that out to the first week in January. We took the biopsy. All the tissue from all 3 little boys are now being shipped to third parties to do the dystrophin analysis. We'll have the data 4 to -- 6 to 8 weeks, we'll release the data. Solid has redesigned its INSPIRE Duchenne trial, and we'll talk a little bit about that. We'll spend a lot of time with that with Gabe when we get into question and answers. But let's talk about our program, and I'm going to give a little insight to where I believe we can take this program that might surprise some people. First, let's just talk about why we think this is a next-generation program. We believe it's because of the transgene, the capsid as well as the manufacturing process, which I believe is the best manufacturing process from a purity standpoint period in biotech and gene therapy. But first, we'll talk about the optimized transgene. This transgene is very unique. We have R23, R24, so we involved. So when we do create the protein, it's called a phased-in protein. There's data out there that suggests when you have a phased-in protein versus a phased-out protein, ambulation is longer. Then we have R16, R17. That's the domains that are very critical important for a protein called nNOS. But when you -- enzyme called nNOS. When you actually see R16, R17, you have to have alpha-syntrophin first. You can have a C-terminal domain and you think you can recruit for alpha-syntrophin when you have the C-terminal domain, but realistically you have to have R16, R17 for that alpha-syntrophin to bind and localize. Then nNOS comes in, it localizes to alpha-syntrophin. And when you have nNOS, the hope is for better resilience, better rebound because there's the vasodilation, there's blood flow. And that's why -- and there's data out there, there's papers out there that suggest that nNOS is critically important for these little boys, especially for rebound and rebound and reduction of exercise fatigue. And then we have 2 hinges, what we believe is the most flexible protein -- micro protein that's out there. So when these kids are moving around, the protein moves with it. Now second part of this next generation is our capsid. And I'm going to spend a little bit of time talking on the capsid in a different way because it's data that is unique. Now we've spent a lot of time over the last couple of years talking about why this capsid is so unique. We've modified this capsid manually, and we've added DRG peptides inside the capsid, all around the capsid. And that DRG peptide really helps an enhanced biodistribution. When you compare it to rh74, when you compare it to AAV9, it's dramatically different, whether you're looking at distribution or expression, it changes. Now one thing we didn't realize is what else comes with these modifications, what else happens to these capsids. Now let's think about a world of what we're trying to accomplish right now. We're trying to bring a next-generation program to patients that have not been dosed. And everyone is focused on a couple of other companies that are in the space that are commercial, and like what is the market that's available. And unfortunately, in the United States, there's going to be about 200 to 300 children each and every year that are born with this disease. That's roughly $600 million to $1 billion of revolving revenue that's unfortunately going to be born into the United States. And we have an opportunity to help those kids that are born. But what about kids that have already been dosed with other drugs or maybe naturally occurring antibodies. It's an idea of how do we take a $30 billion market and turn it into a $50 billion market. How do we create help for those children that need a second dose or need the ability to get a drug that already have neutralizing antibodies. So we saw some interesting data, and we took a look at it. But one of the -- you need three things to happen if you're going to redose. Number one, you have to have a capsid that has neutralizing antibodies at a low enough threshold post dosing of another drug or exposure to another virus, where you can get low enough antibodies, neutralizing antibodies to -- so you can do plasmapheresis, I think like Sarepta is doing or IDS like Sarepta is doing to lower down to a certain moment. The other thing you have to do is you have to have binding capacity. And binding capacity means that when you are able to lower antibodies below a certain threshold, you know those antibodies are going to come back over time. Typically, they come back if you use an IDS after 7 days unless an extended period of IDS or plasmapheresis after maybe 5 to 7 days, you have to have a capsid that has binding capacity that you can dose, transduce and express in that window of time. And there's only one capsid that can do it, and that's this SLB101. This is data that we have released before, but I want you to take a look at the heart. This is day 4. So picture a time when you have neutralizing antibodies to down below a threshold and you're able to lower it, but you know those antibodies are going to come roaring back. You have to have binding capacity to the endocrine receptor so tight, so quick, you can dose, transduce and express in that week. There's only one capsid that can do it. That's SLB101. We've tried it with all the other capsids. You're not going to see it. I'll even show you data in slides down the road on CPVT that's using AAV8. You don't see expression come on until later. Now what about the neutralizing antibodies. The common theme out there is neutralizing antibodies go sky high after you dose another gene therapy. Well, that doesn't seem to be the case with SLB101. Preclinical studies are showing a very low cross-reactivity between SLB101 and rh74 for neutralizing antibody titer. On the left-hand side was mice. Each group is roughly 5. And you can see the SLB, this is after dosing rh74 capsids, you can see the neutralizing antibodies stay extremely low for SLB101. So we went -- that was a very interesting data. So we took it into nonhuman primates, and we said, can you replicate the same thing in nonhuman primates. On the right-hand side is 6 nonhuman primates, you can basically see the exact same thing at day 30. So you're dosing with rh74 and then you're looking 1 month out, what are the neutralizing antibodies. And that's great. So we have preclinical data to suggest that this is possible. But then the question is, can you do it in humans? Do you see low levels of neutralizing antibodies in humans? Well, these are 3 patients from ELEVIDYS. These are 3 boys that have been dosed ELEVIDYS. And the time frame ranges anywhere from 5 months post dose of ELEVIDYS to 5 years post-dose ELEVIDYS. And you can see once again that the neutralizing antibodies are very low. And they're low enough that you can take a plasmapheresis or an FcRn or an IDS with the data that's coming out from the degraders, you can apply it to this drug, and we believe we're going to get to a threshold where we can dose and transduce and express. And remember, you have to have a capsid that can dose, transduce and express in that week time. And there's only one capsid that can do it, and that's SLB101 that I just showed you. Very exciting data. So is the market truly closed? I don't know if it is. And we're going to find out. This is something we're going to explore. Meanwhile, we're going to continue on with our trial in the United States. We've already dosed 4 boys. We know it's safe. Let's see what happens. Now our manufacturing process, I'll talk more about it in the end. I think the manufacturing process is the best in the industry in Duchenne, in FA and -- well in CPVT, in BAG3, TNNT2, et cetera. And we'll talk about full-to-empty ratios. It's got the highest full-to-empty ratio of any company that I know in the space. And why that matters, I'll talk about it at the end. So our safety profile to date is looking like our GLP tox study did. It was well tolerated. We don't have any SAEs. We achieved this with steroids only. I do think that, that really matters from a commercial standpoint. Once you get your BLA open commercially, steroids will just make it easier. To date, that's all we've had to use is steroids, no other third agent with no SAEs. We have now multiple sites open internationally. We're also filed the CTA in Italy. That should be opened up in the first half. And so we'll be conducting not only trials there for accelerated approval in the United States, but also a trial for full approval ex U.S., which that will be a double-blind, placebo-controlled trial. The great thing about that double-blind, placebo-controlled trial that will be ex U.S. We can use that for confirmation in our FDA discussions for accelerated approval. It's going to give them a lot of comfort that we are doing a double-blind placebo-controlled trial ex U.S., and we'll get an answer for them on how well this drug works. Now the design and endpoints, just for time, I'm just going to say, Gabe can answer the questions during the question-and-answer session, but the design is pretty straightforward, multiple cohorts, ages 4 to 7, looking at safety and microdystrophin expression and other secondary endpoints. Now let's talk about FA. FA is, this is a revolutionary program, one that we have been working on in one way, shape or form with multiple collaborators for years. And we all know how devastating FA is. We talk about Duchenne. We obviously realize that Reata made it to the end with FA. We're hoping that we can bring a game changer to this disease state as well. But we know it's a very complex disease. Patients range from having CNS-only manifestations to CNS and cardiac disease state. And we're trying to leave no patient behind. And that was our mission. It was a big mission. It was a bold mission that many people did not believe we could get across the finish line, but we did. It's a revolutionary drug. And we're doing this by dual route administration. Why are we doing this dual route administration? We know that you have to get to the deep part of the cerebellum and the dentate nuclei to really make a difference on the CNS aspect. But early in your lifespan, you also would like to get to the DRGs in the spinal column before they're destroyed. You also understand that patients have this cardiac manifestation of the disease and how do you treat all of that. Our goal, our vision from day 1 of trying to build this program was it did not -- it should not matter if you're a 40-year-old man with just CNS manifestations, I hope we have a drug for you. If you're 20 years of age and you have CNS and cardiac manifestations of this disease, I hope we have a drug for you. And if you're 2 years old, just diagnosed, you have no idea what your journey is going to be, you have no idea how -- what organs are going to be affected, I hope we have a drug for you. It was bold. We got it approved. We're going to be in the clinic later this year. Now I'll just quickly highlight some of the data. We had extensive data. We have two different mouse models because we're trying to combat two different areas of the disease. From a Neuroscore and a RotaRod, you can see that we can get right back to very close to unaffected controls in both the RotaRod and Neuroscore. And the cardiac manifestations with a different mouse model, whether you're looking at cardiac expression, mitochondrial function, how healthy is that mitochondria or the left ventricular mass, we can restore hope for cardiac patients. We can show, and I'm -- we have an elegant, elegant way of getting drug right to the cerebellum, and I'll talk about that in a second. Actually, I'm going to go back and talk about that real quick. This is really game changing. How do we get drug. And from an investor standpoint, you're going to love this. How do we get drug right to the area? Because there's other capsids that are going to come at this, neuronal capsid and they're going to say we can do IV only, but you're not going to get to the deep part of the cerebellum that you really need to get to. And we're doing this by administration with this convection-enhanced delivery catheter that takes it right to the -- it's MRI-guided. It takes it right to the dentate nucleus. But we also use gadolinium. And so what -- from your standpoint, from an investor standpoint, you're going to ask, did you get the tissue, the drug to the target tissue. We're going to know the moment we dose it. Because of gadolinium, we're going to know the moment we put this drug in the deep part of the cerebellum, and it's going to light up like a Christmas tree. And we're going to be able to come to you and say, not only -- knock on wood, not only did we dose multiple patients in -- multiple patient safety, but look where the drug went. And I'm hopeful that, that's going to make a big difference. It least should give you comfort the drug is in the right place, not scattered all over the place because you're pushing drug through an IV. Now this is the picture. This is that on the right-hand side. This is the nonhuman primates. This is looking at frataxin, that's properly localized right in the dentate nuclei. And that's what you're going to be able to see, well, slightly different with gadolinium, but that's the point of trying to make sure that we get drug right to the area. Now unfortunately, we dosed a lot of nonhuman primates. And we had to do 9 different nonhuman primate studies. We had 4 different drugs. We worked with the University of Florida on 201, 202, 203, and then we worked with the University of Penn with 211. And we dosed a lot of animals to make sure that we were doing this. We know exactly how much gets to the cerebellum, gets to the heart because of this. We dosed IV, IT IDN, IV IT and IV IDN, all different ways to really categorize this. And we know more than most people in the world on expression due to this. Once again, I'll let -- we'll talk about the clinical trial design with Dr. Brooks once we get there, question and answer. The cardiac programs, if you don't want a game-changing Friedreich's ataxia program or a next-generation Duchenne program, you say cardiac is where it is, and we believe cardiac is one of the areas in the future. Then catecholaminergic polymorphic ventricular tachycardia, this is a drug. This is a disease that you need to pay attention to. This is highly, highly fatal. For those of you who follow Rocket and you follow Danon, well, this is fatal, young and about 15x the size of Danon. You die from arrhythmias. We just heard from a family just recently. You get the adrenaline surge, and I'll talk a little bit about this. You get this adrenaline surge, because the RYR2 channel makes it more sensitive to calcium levels. And it can result in these abnormal release of calcium and diastole, which leads to delayed afterdepolarizations. That causes the actual arrhythmias. And we heard about a little boy 10 years of age, got on a diving board, climbed to the top of the diving board, a high dive, adrenaline started surging, the next thing you know, he had a ventricular arrhythmia and died. And what we're trying to do is restore this channel by increasing calsequestrin augmentation, soak up the excess calcium, restore normal rhythm. We can look at the mouse models. Top is a normal mouse, then you have this RYR2 transgenic mouse. You really hit them hard with epinephrine and caffeine, and you can see this polymorphic and bidirectional arrhythmias in the middle. And with our drug, you can restore rhythm back to normal. It is pretty elegant. We have 2 different mouse models. We have a CASQ2 mouse model, which you can clearly see here, the arrhythmias are eliminated on the far right-hand side. Once you take away the transgene and you're just using a GFP-treated mouse arrhythmias come right back. For RYR2, roughly 20,000 patients in the United States. These are juvenile mice. And we were able to dose juvenile mice and eliminate all arrhythmias. But the FDA likes you to also dose older mice, older mice so they have been -- they have the disease for a longer period of time, we've dosed older mice as well, and you can see a very, very, very nice dose response. We also looked at protein. And remember, I went back and I talked about redosing with SLB101 and you said -- I said you can't really get expression with other capsids in a week period of time. Well, this is another example. That's a completely different disease. But you're looking at protein expression using AAV8. So our program in CPVT is AAV8. And so you can see here in another disease state, you really don't start seeing expression, the protein expression until about day 42, that a little after 1 month, but it stabilizes for CPVT. So we know now we might be able to see decreased arrhythmias or hopefully help in these patients in as little as 6 months, but I'm sure the clinical trial design will be out to a year. This is just GLP tox. It's easy -- it's clean. All the animals are doing well. The FDA wanted a 6-month arm. We're doing that. We have about 1.5 months or so a month before we have to take down the 6-month arm for nonhuman primates, but all the animals in life are doing greatly. TNNT2 is going to be our final IND in the next 1.5 years or so, in 2026. It is coding for cardiac troponin T, regulates cardiac contraction, huge population, no competition in the space. Our data looks fantastic. It gets right to the heart. It doesn't go anywhere else. You can actually see on the right-hand side, we're able to basically replace mouse TNNT2 with human TNNT2. That's exactly what we want to see. In the mouse model, when you look at ejection fraction, you can see clear changes in ejection fraction on the mouse, on the arms that have been dosed. And for the arm that hasn't, you see the drop in ejection fraction, the animals are getting worse. This is going to be a fantastic another program, really wide open space as well. FA, CPVT, TNNT2, we can own this space. Now our delivery platform, we focus on purity. Why do we focus on purity? We believe it matters for not only safety, but expression. And of course, for those of you who care about COGS, and I think everyone does, obviously, if you're having to dose up because your empty-to-full -- your full-to-empty ratio is low, you're going to have increased COGS. But our platform is some of the purest drug that's out there in the gene therapy space, whether you're looking at Duchenne, CPVT, BAG3, TNNT2, full-to-empty ratios matter, and we are here to tell you that we have the best in the business. And the last slide, anticipated near-term milestones. I think the one everyone is focused on is the data for Duchenne. 6 to 8 weeks from now, we're going to release it, and we'll go from there. Everything else, we're going to be dosing FA patients at the end of the year. We'll be filing our IND for CPVT in short term and hopefully dosing patients later. Very excited. This is a great little company that I think you all should pay attention to. Thank you very much.

Thanks, Bo. I just want to remind folks that there are three ways to ask a question. You can raise your hand and I'll call on you. You can submit a question in the question portal or you can e-mail me. I will start. Bo, there's a bit of a controversy out there related to the DMD program from a regulatory perspective and if accelerated approval is still open to players in the space after the approval of ELEVIDYS?

Yes. I mean we believe it is. We've had conversations with multiple members of the FDA. They've told us that they're going to evaluate each and every program independently. But publicly, they've made statements. I mean if anyone wants to go to the Broad Institute website, there's YouTube page and Peter Marks talked on during this redosing, actually it was a redosing conference. And he said each and every individual program will be judged independently and the accelerated approval is on the table. We feel that it is. Regenix has also had meetings with the FDA. They've made those public statements about the comments that they gleaned from the meeting, and we're going to follow suit. So I think it's wide open. Every signal has been wide open. Public statements have been said wide open. Obviously a private meeting with Regenix and the FDA looks like they have a path forward. I don't believe that the FDA -- and this is just my belief, this is my opinion, not fact. Duchenne is a terrible disease. Kids are dying. They do -- families want choices. I think MDs want choices. I think the FDA will want choices as well. But that's just my opinion.

And then just thinking about some of the biomarker data that you're going to be getting expression, what would you focus the Street on, maybe like quantify what would be a benchmark for success?

Well, I'm going to turn it over to Gabe, Dr. Brooks, in a second. I just want to say, look, biomarkers are important. We actually learned a lot from Duchenne. We made a lot of mistakes of how we think about clinical trial design. But fundamentally, you want to understand if your drug is shoring up muscle. And there are biomarkers that look at chronic and acute damage, and that's what we're going to look at, not just CK but also multiple ones. But I'll turn it over to Gabe.

So thank you, Anupam. So Gabe Brooks, CMO here at Solid Biosciences. And so we're taking a comprehensive look at the integrity of the muscle. And so that includes, yes, CK, which interrogates the membrane and muscle health, but also titin, which is an emerging biomarker. There was just recently a Nature paper that showed the utility of looking at titin as a marker of muscle integrity. We're also looking at muscle metabolism with LDH and AST-ALT as well. So from this data set at 90 days, we're going to say how much microdystrophin did we express. And then what is the biologic relevance. What's the biologic impact in using multiple different perspectives.

Questions from the audience?

I think you previously stated that all the patients that -- the 3 patients where we're going to get efficacy on are going to be around 5 years of age. And I think you've stated one of the patients may have some baseline underlying cardiomyopathy. What should we be looking for in that patient? And what could that mean in terms of differentiation for you?

Yes, I would turn this over to Dr. Brooks. I mean the only thing I'll say is, look, these kids, some end up more severe than others, they have a different LDL path, and that's how Duchenne and FA and all these other terrible diseases are. It's a very heterogeneous population. And you can get early signals that tell you what their path might end up being. And we've taken a little bit of risk here, but I'll turn it over to Gabe Brooks.

So I'm a cardiologist, so full disclosure, but let's not forget in Duchenne muscular dystrophy that there is a dilated cardiomyopathy that's part of the disease process. That remains cryptic before you start seeing cardiac dilation, but we know that there's fibrosis that attacks those hearts. And we can see that there's muscle -- ongoing muscle damage because there is high-sensitivity troponin or troponin that's leaked from those cardiomyocytes indicating muscle injury. In this case, it's cardiac muscle injury. We're acutely aware and look at that marker because with any AAV gene therapy, we want to make sure we're monitoring for myocarditis. But also by looking at that marker, we are looking at the prospect of potential benefit in these patients, in these boys where they have ongoing troponin elevations. And we know that this is a disease state where you do see in this population elevated troponins because of what we just discussed.