Tenaya Therapeutics, Inc. (TNYA) Earnings Call Transcript & Summary

Thank you to the -- and welcome back to our next session of the Global Healthcare Conference here in sunny Miami. I guess I'm hosting everyone in more than one way in my adopted home. And with me I have Faraz Ali from Tenaya Therapeutics, who had -- you guys had some interesting data this morning that you put out already out. The press release is out so can have a chat about it.

Talk to me about what this data adds to the pool of evidence we have so far, and then we'll go to the strategic and scientific implications afterwards.

Yes. Great. So a lot going on at Tenaya. Just thanks, Leerink, for the opportunity to be here today. We have 3 clinical stage programs. So I know we'll spend a certain amount of time on the 2 gene therapy programs, which have been traditionally mostly in focus, TN-201 and 401. And indeed, that's -- our focus remains there and achieving milestones that we'll talk about later. And then 301, also clinical stage small molecule, highly specific HDAC6 inhibitor. And we completed a first healthy human volunteer study in the past, clean, good, nice data, no dose-limiting toxicities. And then the question has always been what next? So limited resource in the last couple of years, we were focused on the gene therapy program, and that was the right thing to do. And now we're in a very good position that this year that we can generate data that might support pivotal studies and pursue regulatory alignment. But in parallel, we never sat still on this front. And so we continued to generate preclinical data on this program and mechanistic insights on this program. And so today, the data that was presented was at the muscular dystrophy or is being presented in a poster at the Muscular Dystrophy Association meeting. We've shown that this molecule also has a positive impact in DMD hearts and DMD skeletal muscle. Why is this important? Is Tenaya going to become a DMD company? No. What we have done with this data set to put it in a broader perspective, is confirmed in yet another preclinical model, the potential for in vivo efficacy with HDAC-specific inhibition. We've demonstrated that by now in HFpEF. We've demonstrated this in genetic dilated cardiomyopathy. This is our own molecule in our own hands in peripheral arterial hypertension -- sorry, pulmonary arterial hypertension as well as now in DMD, skeletal muscle and cardiomyopathy. This is verifying the broad clinical utility of TN-301 in a range of attractive indications and a true pipeline and a target or pipeline and a pill potential of this molecule. Now why is that the case? The other thing that we're verifying is this multimodal mechanism of action. Like how is it possible that one molecule against one target is having a benefit in many different things. One, we verified this from the outside. Other people have also demonstrated data in cardiac indications and cardiac adjacencies, including in some of the indications that we're interested in. So that verifies our data. But also collectively, the field is beginning to understand with HDAC6 inhibition, you can get anti-inflammatory effects antifibrotic effects, improvement in protein quality control, improvement in metabolic dysregulation, just improvement in autophagy. It's that multimodal mechanism of action on very common pathways that seems to have an effect in multiple disease animal models. Now animals are great. We can all cure mice, right, including multiple mice. One interesting thing that also happened in parallel over the last 2 years is the approval of a pan-HDAC inhibitor, givinostat brand named Duvyzat. So Italfarmaco, a company out of Italy, private company, so not a lot of people know about it, they quietly executed on a pan-HDAC inhibitor clinical study in DMD, showed statistically significant benefit versus placebo in decline of muscle function, got an approval in the U.S.A. and Europe and have a launch. And rapid uptake in hundreds of patients have been dosed, hundreds of millions have been generated in revenue. And this is -- and some people are using it on top of gene therapy. Now why is that relevant? Our data shows that the benefits or suggests at least that the benefits that Duvyzat has demonstrated in DMD patients leading to an approval is due to HDAC6, not the other HDACs, right? And so we've shown that we have superiority with -- when we did a head-to-head comparison with HDAC6 and pan-HDAC inhibition, we are getting better results in both the skeletal muscle as well as in the cardiac engineered heart tissue. So that suggests that HDAC6 is the source of the efficacy, but without the liabilities associated with pan-HDAC. So they have QT prolongation risk, we do not. They have thrombocytopenia in their clinical experience, we do not. And so overall, that gives us some clinical relevance and translatability of what we're showing in the mice because otherwise, who cares about like curing mice. It's that clinical relevance of HDAC6 specific inhibition that we're excited about. And again, this just is validating the target, validating the mechanism of action that we think also will derisk HFpEF and other attractive cardiac and cardiac indications, cardiac adjacencies because it's the same multimodal mechanism of action that's responsible for all this. So that's why we're excited about this development today. We are moving this forward towards clinical development. We are not hurting our cash runway in the process of doing that, right? So we're doing enabling work that will support future proof of mechanism, proof-of-activity studies. And so it all fits within our current cash runway. A little bit of CMC and formulation development, a little bit more toxicology, but we're building on the existing IND that we have open for the Phase I. And so we're excited about this. It's adding another leg to the Tenaya story. So TN-201 gene therapy, TN-401 gene therapy, now TN-301 small molecule and the exciting announcement of the collaboration with Alnylam.

Before we get to that clarification we will sort of the cross-franchise medicine crossover. Let's talk about this data in the context of the guidance you've given for cash runway, OpEx, et cetera. Just so we can think about what the incremental spend is, which clearly doesn't change the runway. But people think about how this fits into your existing infrastructure. That's a lot of programs to prosecute simultaneously with a relatively small absolute spend rate.

Yes. We've always been actually quite efficient, remarkably efficient. We do a lot with a little. But -- so the enabling work is not very capital intensive. That's first and foremost. That's why there's no impact on the cash runway. What would become capital intensive is once we start doing studies, right? And so we have to be clever about the selection of the specific indications and the design of those studies to be capital efficient there. Now initial studies would not be -- we're not looking at large outcome studies here quite at this stage, right? These are smaller proof-of-activity studies that would be the next logical step here in this program. That could be executed on by our company. Now you did raise an important point, with so many potential indications in play, are we going to do this all alone? Are we going to do this as a partner? We think we'll continue to explore partnership opportunities. We do think that there are people who are quite interested, and we know this from direct engagement, quite interested in what we're doing. We also know that a lot of value and a lot of derisking will be achieved and a lot of value will be created by generating this -- the data in disease populations. And then after that, clearly, we're never going to do HFpEF on our own, large indication, large outcome studies required. We will need a partner for that. However, the data we generate from proof-of-activity studies can actually, I think, result in a lot of people interested in the molecule, not only for HFpEF or DMD, but potentially many other indications.

So let's talk a little bit about how you think about what should be useful for what from a strategic perspective because there will be a universe of investors who will argue, shouldn't this be your primary in-house focus rather than a primary partnership. And that's not...

You mean 301...

Yes. It's just how you -- you talked about being nimble, rational, data-driven is actually how you've called it in previous calls. How do you think about that? When is it appropriate to pivot, tack, since we're in a port city? And when is it not?

Well, I mean, one thing -- so we're not pivoting. This is -- I just want to be clear here. This is not a -- it's important to say out loud. This is not because of any lack of conviction on our TN-201. TN201, TN-401 for which we raised money last year, we are very pleased with where we are, very pleased with where we're going, maintaining our guidance, data in the first and second half of the year of both programs and potential for regulatory alignment. Our conviction in those gene therapies have only gone up in terms of sort of the data set and what we think is possible there. So this is not a oh s****, we might pivot here. This is not a pivot. This is an and, not an or. Now yes, choices have to be made in the future, what to do ourselves, what to partner, which one to prioritize. Today, for this year, we don't have to make those choices. Today, for this year, our capital substantially is going on 201 and 401 gene therapies, right? Then when we come in the second half of this year and on the other side of catalyst, as we think about the next round or the next raise, then it could be that at that point, we have to make some choices about what do we want to -- where do we want to allocate capital in the future prospectively. But for now, 201, our conviction is high. And for now, we would like to -- we own it completely. We still don't have a partnership for that. And if today, somebody wanted to just take us off our hands for little dollars, we wouldn't do that because we just see too much value here right now. So we'll continue to own this and drive this forward. And either a very, very attractive deal will materialize that will take us off our hands or from which we can meaningfully still codevelop and collaborate or we will drive this. We see a very capital-efficient way to get to clinical data in one or more indications through possibly multiple proof-of-activity studies. We'll give a little bit more updates as we get further into the year. And that could just transform the profile of the company. That could just completely transform the profile of the company that in addition to gene therapies, now we've got another entire value driver with multiple horizons of opportunity, and then those will be good problems to have.

Those are good problems to have.

Yes.

Let's -- I'm going to take a step back to the -- what we think of as sort of the base gene therapy business. Let's talk a little bit about where we are in HCM, having navigated a pretty deep engagement with the agency. We can touch base on the status of your conversation with the agency separately. What is the data pathway from here through the next 18 months in that indication? And what are some of the key events that unlock clinical value now that we're sort of -- now that we're back on the runway?

Yes. Yes. So look, I mean, we were very pleased with the data that we shared at the AHA meeting last year that was published at the same time in Circulation Research. And for those who are not familiar with it, just as a reminder, that included improvement at the very first dose, which is a relatively low dose, 3e13, the first 3 patients treated, all of them with sufficient follow-up dramatic reductions in circulating biomarkers like cardiac troponin I, dramatic reductions in measures of hypertrophy, including LVMI and posterior wall thickness and all patients at New York Heart Class I. This established a very good base from which we're operating. Now we're dosing more -- we have completed dosing of the second dose cohort. And now we, in fact, had initiated dosing in the expansion cohort. So dosing more patients, mostly at the high-dose cohort. That data will mature. So over the course of this year, we're going to see a few things. We're going to see the Cohort 1 patients now approaching the 2-year mark. So do we see the persistency of that data? Do we see a deepening of the effect? That's Cohort 1. And then Cohort 2 will come into focus. Do we see deeper effect, faster effects? What do we see with the higher-dose cohort. So that will help address multiple things. One is the product working at both doses? What's the right dose to take into pivotal studies? And what does the safety and efficacy profile look like at both doses. So that is all going to come out with the patients that we already have, plus the new patients we're dosing. But substantially, actually, most of the data from the patients already dosed will help drive this decision. Of course, we're going to be dosing more patients and we'll generate data for that in the second half of this year as well. So very important derisking of the program, very important opportunities to generate yet more positive data and use that data to engage with the regulatory agencies about what's the right path forward here. What are approvable endpoints for full approval, what are the approvable endpoints for accelerated approval? What's the right population to advance this in? Is it adults? Is it severe pediatrics? So a lot will come out over the course of this year.

So let's talk a little bit about those conversations with the agency. I had this discussion with a few companies over the course of days, as you can imagine.

We love the FDA, yes.

I hear you. The agency has had some volatility and leadership. Talk to us about how much change, if any, you've seen, an evolution you've seen in terms of your counterparties for your particular filings or filings in terms of who you're working with at the FDA, infrastructure, resources, morale, how has that evolved?

I can't speak to anything about what's going on at the FDA. We just have our interactions with our own group, and I don't have any new data points to suggest that anything has changed with the specific groups that we're working with right now. We just have -- we hear the same rumors and reporting from everybody else, but I can't say anything specific about the specific teams that we're working with. Yes.

That makes sense. So hopping back into the pipeline. There's been a lot of discussion around...

But I will just say on the regulatory side, one thing that we like to remind people about, there has been this whiplash of like, wait, they said this, then they said this, they said this and then they said that, REGENXBIO, uniQure have probably been the 2 worst hit in terms of that regulatory uncertainty. But we do like to -- on the HCM program in particular, so the TN-201 program, over there, our best precedents are from Lexeo and Rocket, right, on their respective lead programs, Friedreich's ataxia and Danon disease. And for both of those companies, they had an alignment with the FDA about protein expression and improvement in hypertrophy of greater than 10% as co-primary endpoints for accelerated approval. They had established that under the old FDA regime, and they reaffirmed it last year under the new FDA regime. So I think that's good that the current -- their teams, whoever their teams are, those teams under the current FDA reaffirmed what the previous team had said. So that, I think, hopefully will reduce the likelihood of unpleasant surprises on the HCM side because they've already reaffirmed the guidance from the previous, and that's a good thing. So we have to prove that those could also be applicable to us, protein expression and improvements in hypertrophy as a base of accelerated approval. We have to prove that for ourselves, but we're glad to see that the guidance did not change for those 2 companies who are the best comps yet for us on that program.

I think that's useful to hop back on the pipeline exactly that topic. Obviously, Rocket is a comp for the lead program, also a competitor, teammate, depending how you want to think about it from PKP2, et cetera. How do you think about the universe of data you've seen across companies? And what should be the endpoints we consider as meaningful, maybe eventually registrational for PKP2, recognizing there was a debate around Lexeo's data around NSVT versus PVCs. Is that debate meaningful in your mind? Or is it sort of a Wall Street splitting hands on 2 things that are very closely related biologically?

Well, we're glad that Wall Street cares. We're glad that they're paying attention to these programs. We are super excited about our TN-201 program. And for a while, we had to like get interest going on TN-401 that we're past that. People are interested in TN-401 as well, and that has very much come into focus. So we're glad with the attention and partly perhaps the competitive dynamic has contributed to that. Look, there is a continuum of things that contribute to the disease in these patients, right, on the electrical and stability side, PVCs, NSVTs, sustained ventricular tachycardias, ventricular fibrillations all the way to sudden cardiac arrest and death, right? The PVCs are more frequent, sudden cardiac arrest, thankfully, less frequent, but very severe. We have clear data that suggests that -- and the risk calculator that has been produced not by the companies, but by third-party academics who are experts in this field, that reductions in PVCs and NSVTs are both -- and then also T-wave inversions. They are part of a broad -- gender, a couple of different factors that contribute to risk calculations. Both PVCs and NSVTs are included there. So we don't -- I do think it's trying to zoom in and saying this is it. This is the perfect endpoint. I think everybody is going to have to make their own case with their own review team. We like what we're seeing with our early data that we've seen improvement -- clinically meaningful improvement in both PVCs and the one patient who had high NSVTs came down to 0. We think our -- those data, while early, are differentiated. They are sort of more consistently robust. And we're not going to pick a winner here that it's PVCs or it's NSVTs. So that's -- I think it's splitting here. It is part of a common mechanism. These things both get -- if you look at antiarrhythmic medications like flecainide and amiodarone and others, they tend to benefit not just one, but both. So it suggests that there's a connection between those 2. And so trying to say like, no, it's NSVTs. We say that it's PVCs, I don't want to get into those kind of arguments. I think we will make the argument with the FDA about what is the right endpoint for clinical development, right? That's -- even though those 2 may go in tandem, maybe one is up, one is down, but what's the right endpoint that you pick for clinical development? That is exactly the discussion we're having right now among ourselves. Those are the arguments we'll make with the FDA. I would say that one thing that is underappreciated by the field is that we have the largest natural history data in the world -- data set in the world with a RIDGE study. So there's more than 185 patients from 21 sites in 6 countries that have been enrolled prospectively into that study, representing like more than 2,000 patient years of patient data. That gives us access to a very rich data set. That allows us to look at PVCs and NSVTs and what remain -- what's the level of variability with or without different doses of different medications. There's just a very rich data set that we think, in addition to our own clinical data, allows us to approach the agency, hopefully, with better arguments about why one endpoint versus another or a composite or whatever is the right way to go with this -- as you're coming up with endpoints for whether full approval or accelerated approval. So that will come into play as we have our negotiations with the regulatory agencies. I think that data set is -- in an indication with a lot of variability, having a larger data set matters.

I think in thinking about the sort of pathway towards an eventual pivotal, I'm be showing my colors here who trained me in this business. But I think of things a little bit like a matrix of who you are dosing and what you're trying to show. And we talked about what you're trying to show and the decisions people have to make around endpoint. As the question of who you are dosing, obviously, at the top of the funnel and this indication is vast, then you have incomplete penetrants, patients who are symptomatic or not, patients who have been instrumented or not at which point they are protected from immediate death, although shocks are extremely unpleasant and like quite distressing and like terrifying to some patients. Where along that funnel from everyone with a genotype everyone with a phenotype all the way down to the universe of patients that are instrumented but are experiencing extreme nervousness and painful shocks, like where should we be dosing patients for potential gene therapy application for PKP2?

Yes. So look, I believe this is the case for every one of the companies. All of these patients are already on ICDs. So we're -- that's off the table. We're already enriching for patients with higher severity. At least we are, I can't speak for the others, but we're enriching -- you must have more than 500 PVCs a day to even enter into our study. Now that -- not everybody shares that. If you look at the Rocket, the first 3 patients they dosed, they have a patient below -- I think that's down to 100 or 200 PVCs a day. That patient wouldn't even have entered our study. So we're enriching for a little bit more severity, right? Obviously, we're enriching for patients who don't have the neutralizing antibodies, et cetera, et cetera. All the patients are on background medications. And clearly, they've failed. At some level, virtually every patient we're treating, they're on standard of care background, whether it's flecainide or amiodarone or something like that, many of them have already had ablations. And so despite surgical intervention like ablations, despite medications, they still have these elevated PVCs and NSVTs and therefore, risk of severe ventricular arhythmic events, including shocks. So I mean, I don't think there's any further enrichment that we're going to be doing now. Now having said that, connecting the dots with my previous comment, if we find through our data sets or engagement with the agency that enriching for a particular population for a particular endpoint would be advantageous for clinical development, Again, the natural history study puts us in a better position because we have 185 patients to draw from. So if there is a stratification to be done and say like, let's get patients with this threshold of PVCs or NSVTs or some other attribute, right, and that will likely result in a better clinical outcome or a better study for us, we have the data. We have the patients to draw from if there's further substratification to be done. But right now, I wouldn't say that there's anything else that we have to do. The patients have the mutation, they have severe disease despite standard of care therapy, and we're demonstrating that we can make a dent in that electrical instability of a kind that wasn't being achieved with surgical interventions and standard of care medications. Remember, none of these patients are washing out. They're staying stable on their dose of their existing therapies. So anything that we are achieving any of the 3 companies, I believe, is on top of what they're already getting.

So -- and I think we're coming down to the end of time, but I don't want to like leave this unspoken. We've talked about the dynamic on patient selection, endpoint selection. What is the pool of data we're going to be seeing in this indication from you over the next 18 months? And how will you be strategically digesting and responding to whatever we get from Rocket's engagement around pivotal trial, the design with the FDA?

So the data we'll be generating is -- so the early data release that we did, it was the first 3 patients at early time point. The first 2 patients were at 6 months. The third patient was not at 6 months. So first things first. First half of this year, we're going to get all 3 patients in the first dose cohort close to 1-year time point or at the 1-year time point plus early data from Cohort 2. Second half of the year, we'll have further data from Cohort 1 and Cohort 2, all at the 1-year time point. So meaningful full cohort data sets. So that's what we've committed. That is consistent with our guidance. How are we responding to others? Well, we didn't have a chance to talk about like Lexeo's update in January. There's a lot of noise there in the protein as well as in NSVTs and the PVCs, right? So that says something about the disease, says something about the therapy, says something about their protein measurement methods. Rocket, whenever they release data that will provide to get more information, I'm sure the data release, we did inform them as well. So I think this is an exciting and dynamic time for the companies and for patients where there's 3 companies advancing 3 programs, and it's too early to declare winners and losers yet. But I think this will be a year where there will start to be some separation on the basis of safety and/or protein consistency and/or markers of electrical instability and/or announcement of alignment of pivotal studies. So we're watching them. They're watching us and you're watching all of us.

Can you talk about the Alnylam partnership, the near-term milestones [indiscernible] and earn additional capital from that partnership this year?

Yes. Great. So first, we're super excited about that. World leader in RNA siRNA therapeutics, perfect marriage. They've got an established cardiovascular franchise now, including a TTR. And then we've got these differentiated capabilities. They like what we have. We like what they have. So it's a perfect marriage that way. And then in terms of the actual capital, so we get the $10 million upfront, we get research reimbursement for 2 years and then about $1 billion and change, $1.1 billion in biobucks. Are there -- so those biobucks include payment for different milestones as they're achieved on a per target basis. But we're not going to provide guidance at this time of what could be achieved in the coming, say, 12 to 18 months of our runway. But yes, there are milestones that are tied to -- there are payments tied to more near-term milestones and, of course, higher payments for the longer-term milestones, but we're super excited about this collaboration. Deep validation of our research capabilities, true to our modality-agnostic approach to the cardiac disease, gene therapy, small molecule and now a partner with deep expertise in siRNA. So we're just continuing to execute on the original vision of the company and hedging our bets with a lot of different modalities. So we don't just -- we're not just a gene therapy company, which is how some have come to think of us over the last 2 years. We've got a lot more going on here. And I think if you look at a company like us, we have multiple horizons of opportunity. Right now, we have a horizon of opportunity with gene therapy, 201 and/or 401. That's a this year thing. 301 is going to provide the next horizon of opportunity in the coming nearish future. And then right behind that now, then we'll have the opportunities with Alnylam and the pipeline there, not to mention our own homegrown pipeline product candidates. So there's a lot going on at the company. It's an exciting time for us and it's an exciting time for investors. And it seems like the market is reacting well to both the Alnylam announcement as well as the announcement that we're moving 301 forward, and that's a little bit of the flavor of the dialogue we've had with investors here today. People like what they're hearing. Sorry, I didn't -- I can't specifically answer your question, but I'm going to answer the question I wish you had asked, which is what is exciting me about where Tenaya is today, and all of this is exciting me. It's a great -- it's going to be a great year for us.

All right.

Thank you.