Sangamo Therapeutics Q2 2023 Earnings Call Transcript

Quartr
Provided by Quartr
August 8, 2023

There are 15 speakers on the call.

Operator

Welcome to the Sangamo Second Quarter 2023 Teleconference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Louise Wilkie, Vice President of Investor Relations and Corporate Communications. Please go ahead.

Speaker 1

Thank you. Good afternoon. I'm Louise Wilkie, Sangamo's Vice President of Investor Relations and Corporate Communications. Thank you for joining us on the call today. On this call are several members of the Sangamo executive leadership team, including Sandy MacRae, Chief Executive Officer Mark McClung, Chief Operating Officer Patricia Durababu, Chief Financial Officer Jason Fontenot, Chief Scientific Officer Natalie DuBarr Stringfellow, Chief Development Officer and Lisa Roy Care, Chief Medical Officer.

Speaker 1

Slides from our corporate presentation can be found at our website, sangamo.com, under the Investors and Media section of the Events and Presentations page. This call includes forward looking statements regarding Sangamo's current expectations. These statements include, but are not limited to, Statements relating to the therapeutic and commercial potential of our product candidates, the anticipated plans and timelines of Sangamo and our collaborators for regulatory submissions, initiating and conducting clinical trials, screening and dosing patients and presenting clinical data, advancements of our product candidates, anticipated feedback from and interactions with the regulatory agencies advancement of preclinical programs to the clinic our strategic reprioritization and the anticipated benefits thereof, the sufficiency of our resources, cash runway and plans to seek additional capital, our estimated financial guidance for 2023 and estimate of 2024 operating expenses, upcoming catalysts and milestones and other statements that are not historical facts. Actual results may differ materially from what we discuss today. These statements are subject to certain risks and uncertainties that are discussed in our filings with the SEC, specifically on our annual report on Form 10 ks for the fiscal year ended December 31, 2022, as supplemented by our quarterly report on Form 10 Q for the quarter ended June 30, 2023 filed with the SEC.

Speaker 1

The forward looking statements stated today are made as of this date, and we undertake no duty to update such information except as required by law. On this call, we discuss our non GAAP operating expenses. Reconciliation of this measure to our GAAP operating expenses can be found in our press release, which is available on our website. Now I'd like to turn the call over to our CEO, Sandy Macrae.

Speaker 2

Thank you, Louise, and good afternoon to everyone joining the call. The Q2 has been a busy one for Sangamo, and I'm pleased to Some exciting clinical and preclinical progress as we advance our mission to translate groundbreaking science into genomic medicines that transform the lives of patients afflicted with serious genetic diseases. Our visionary culture has been a key driver in our success to date alongside our innovative approach to genomic medicines, both which I believe will continue to drive Sangamo forwards towards the future. Starting with our clinical programs, we continue to make good progress in our Phase III STAR study for Fabry disease, having now dosed a total of 22 patients. Importantly, we recently received productive written feedback from the FDA on our post Phase 3 trial strategy.

Speaker 2

While we're seeking some specific clarifications, it's as it stands Today, we feel we have a regulatory path forward to a potential Phase 3 trial. I'm enormously proud of the team for the work to get us to this point. We're refining our trial strategy and expect to submit a proposed Phase 3 protocol to the FDA as early as the end of 2023. Needless to say, our operations team is driving forward with the logistics of these studies in parallel. We have also made good progress advancing our wholly owned clinical asset TX200, our CAR Treg cell therapy candidate for renal transplant rejection.

Speaker 2

Based on the encouraging safety data to date, we received endorsement from the safety monitoring committee to progress to the next dose cohort. We are encouraged by the rate of patient enrollment we are seeing in this study and are pleased to be receiving initial from European regulators for an updated study protocol that we believe will enable us to accelerate more quickly through the dose escalation phase. The underlying value of Sangamo is our zinc finger platform, which we believe is at the cutting edge of genomic medicine. Jason will share more context on the importance of our science and our neurology pipeline shortly, along with some of the exciting scientific advancements We presented this quarter on our 2 lead neurology programs, our AAV capsids and our platform. These scientific advancements are at the heart of the 3 business development deals that we recently signed and that Mark will elaborate on shortly, all of which underscore the important role Sangamo plays in helping to progress the broader cell and gene therapy industry forward.

Speaker 2

We are proud to be part of the important collaboration that is necessary within the field in order to best serve patients and are happy that our genome editing and payload delivery technology is being recognized by the broader industry. Lastly, I'd like to take a moment to welcome Doctor. Lisa Roycare as our new Chief Medical Officer. Lisa joins us with strong experience as a physician and a drug developer. I'm delighted to have her as a strategic member of the leadership team focused on advancing our clinical and preclinical programs.

Speaker 2

And I am confident she will continue to bring great value to Sangamo as we progress our potential medicines closer to patients. We are proud of the strong progress we have made this quarter. Nevertheless, we recognize the importance of bringing in additional funding, as well as further reducing our operating expenses. This is a top priority for me and the rest of the leadership team and remains at the forefront of decision makings each and every day. While we stay committed to execution in our prioritized clinical and preclinical activities, We look forward to providing updates in these areas at the appropriate time.

Speaker 2

I'd now like to turn the call over to our Chief Development sir, Natalie, who will share more on our clinical programs.

Speaker 3

Natalie? Thank you, Sandy, and good afternoon to everyone on the call. It is my pleasure to provide an update on our clinical program over the last quarter, beginning with Fabry disease. In May, we announced that the U. S.

Speaker 3

FDA granted Fast Track Designation for ST-nine twenty, our oleone gene therapy product candidate for the treatment of Fabry disease. Fast Track definition is intended to facilitate the development and expedite the review of new therapeutics and reflect the substantial unmet medical need for patient with Fabry disease. Receiving this important designation to provide Fabry patient with improved treatment options. The Phase III STAR study continued to advance With 13 patients now dosed in the expansion cohort for a total of 22 patient dosed overall, we're making good progress in enrollment With strong demand from site internationally, we anticipate presenting additional Phase III data in early 2024. This quarter, we submitted the briefing book describing our proposed Phase 3 trial strategy to the FDA and recently received on something which is increasingly common with the agency.

Speaker 3

We were pleased with the clarity of the feedback and feel encouraged that we have a regular path for potential Phase 3 trial and for Fabry disease patients. While we cannot disclose full detail of the trial strategy at this time, I can share that we are currently designing a trial that is intended to maximize the potential addressable patient population for ST-nine twenty across 2 studies. Based on the FDA feedback received, we do not expect We're seeking additional information from the FDA on specific point and on some specific point, I expect to submit a protocol Phase 3 protocol to the FDA as early as the end of 2023. We hope to be able to provide further clarity on next step in the coming quarter. Moving to the Phase III steadfast study of our OLEON TX200 CAR Treg Cell therapy candidate for the prevention of immune mediated rejection in HLA A2 mismatch kidney transplantation from a living donor, We made some significant progress this quarter.

Speaker 3

A total of 6 study sites across 4 countries are now open and actively enrolling patients with strong interest being seen across our study sites. The Safety Monitoring Committee met in May to review data from Cohort 1, and I'm pleased to share that the ENDORSE moving to the next higher dose level based on the encouraging safety data from the 3 dose patients and the 2 control patients. Preparation for the next dose cohort actively progressed. We have successfully manufactured the product candidate for patient 4, the first patient in the second cohort and the patient has received their kidney transplant, Dosing is expected in the Q3 of this year. In parallel, we continue to pursue opportunity to accelerate dose escalation with regulators.

Speaker 3

Based on the encouraging safety data to date, we feel it is best for patient to accelerate as safely and quickly as possible through to the highest dose cohort, where the dose can be more than 20 times greater than the one used in cohort 1, we have received scientific advice and submitted an amendment study protocol to regulatory authority in Europe. We are thrilled to have already received our first full country approval. We intend to share initial data by the end of the year. Finally, Purectocochin FITERALPOWERVAC, our investigational gene therapy we are developing with Pfizer for patient with moderately severe to severe hemophilia A currently in Phase 3 continues to progress. As we outlined last quarter, dosing required for primary analysis incomplete and Pfizer continued to work towards a pivotal readout expected in mid-twenty 24.

Speaker 3

Pfizer anticipate potential BLA and MMA submission in the second half of twenty twenty four. I will now turn the call over to our Chief Operating Officer, Mark, who will discuss business development update from the quarter. Mark?

Speaker 4

Thank you, Natalie, and good afternoon, everyone. A core component of the Sangamo business strategy is to drive value by advancing our wholly owned pipeline while simultaneously strategically leveraging partnerships that create additional value. We have made a deliberate decision to provide biotech and pharma partners with access to our technology when they are working in areas outside our strategic focus or when they can bring added value of their own expertise or proprietary technology. This advances medicines towards patients more quickly and this is our priority, but it also accelerates learnings that we can apply to our own programs and technology and brings important non dilutive funding to the company. The partnership world is opening back up in Biotech.

Speaker 4

And as a result, our business development team has seen an uptick in interest. In the last 2 months, we have been excited to announce 3 strategic partnerships that not only highlight the potential value of our technology, but also the incredible work going on with the related fields. These transactions reflect continued interest in our technology And importantly, both genome editing and payload delivery are being perceived as something Sangamo can offer. We feel encouraged by this progress and feel honored to be part of such innovation for the betterment of patient lives. As outlined at the last quarter earnings, Our neurology platform is at the heart of our prioritized strategic focus and we're very proud of the progress that we're making through our own AAV capsid engineering platform called SIFTer, the advancement of which is essential to solve the current challenges of delivery.

Speaker 4

Capsids are critical to unlocking the therapeutic potential of gene therapies and our entire genomic engineering platform. Last month, we granted rights to Prevail Therapeutics, a subsidiary of Eli Lilly to access certain Sangamo proprietary cerebral spinal fluid administered capsids for the evaluation of neurologic targets, which we are not planning to study ourselves. Sangamo earned an upfront payment and if Prevail exercises its option for all targets and a Prevail product is approved in the U. S. And Europe for each target, Sangamo would also become eligible to earn exercise fees as well as developmental and commercial milestones of approximately of $1,200,000,000 in addition to tiered product royalties.

Speaker 4

This agreement highlights the potential value of our AAV capsid engineering program, not only for our wholly owned programs, but also as an opportunity to work with partners to broaden the scope of our diseases addressable by AAV gene therapy. We are thrilled to work with Preval and evaluate our cerebral spinal fluid administered novel capsids for neurological targets and are pleased that the other genomic medicine companies recognize their potential value. Each target indication is its own specific BRAIN coverage requirements. So there's no one size fits all capsid to address all indications. That's why at the end of June, we also shared that we entered into a license agreement with Voyager Therapeutics in connection with our epigenetic regulation treatment of prion disease.

Speaker 4

We are combining Voyager's intravenous administered delivery capsid with our zinc finger transcriptional regulators that we believe can specifically and potently block expression of the Prion protein, which is the pathogenic driver of Prion disease. Our goal is to bring this potential treatment to patients With this devastating disease as soon as possible and based on the animal data, we believe Voyager's capsid is the right one to target the specific parts of the brain that we believe are relevant to Prion disease. This agreement reflects Sangamo and Voyager's shared commitment to addressing unmet need of neurologic diseases and gets us one step closer to our anticipated IND submission in 2025. Given the rapidly progressing and fatal nature of Prion disease, We and Voyager felt that it was important to work expeditiously to bring a potential new medicine to patients. This mutual sense of urgency led to the decision to move forward with Voyager's capsid for Kryon, while our own significant efforts to discover capsids with broad brain delivery or will be advanced for other Sangamo programs.

Speaker 4

Finally, last month, we announced an agreement with Chroma Medicine, under which Chroma will evaluate select zinc finger proteins for epigenetic editing. Leveraging our technology platform in combination with Chroma's Sangamo will be providing Chroma for evaluation specific zinc finger proteins designed to target the specified collaboration genes, which are outside of the central nervous system and our strategic focus in exchange for upfront technology access payment. If Chroma exercises its options for any or all targets, Sangamo would become eligible to earn an option We're combining our zinc finger technology with Chroma's capabilities and believe this work will further validate the importance of zinc fingers as an ideal platform to support epigenetic editing. The importance of these partnerships stretches beyond potential monetary returns. They are also crucial and critical to unlocking the full value of our scientific assets.

Speaker 4

We remain committed to our shareholders and will continue to seek strategic collaborations that enable us to leverage our technologies in order to support our future plans. I will now turn the call over to our Chief Scientific Officer, Jason for an overview of the preclinical pipeline. Jason? Thank you, Mark, and good afternoon, everyone. It is great

Speaker 5

to have this opportunity to highlight the work from Sangamo Research and our preclinical pipeline in the past quarter. Today, I will specifically focus on the exciting progress we've made in advancing our neurology focused in vivo genome engineering therapeutics pipeline. Our strategy to focus on developing transformative medicines for neurological diseases was born out of a decision to maximally leverage The core strengths of the Sangamo Scientific team and the most differentiated aspects of our science and technology platforms. Our goal is to develop transformative genomic medicines that are both safe and efficacious. To achieve this goal, Our AAV based genomic medicines require 2 critical factors for success, a highly precise and potent cargo, namely our zinc finger epigenetic regulators and an AAV capsid that can deliver this cargo safely and effectively to the relevant tissues and cells.

Speaker 5

Both are crucial for success and we believe Sangamo is uniquely positioned with this combination of cutting edge technologies. Innovating in these areas is a major focus of Sangamo's research engine. And as evidenced by the data we presented this quarter at ASGCT and elsewhere and by the recent agreements with Prevail Therapeutics and Chroma Medicine, we are making tremendous progress. This progress is bringing us Closer to potentially transformative genomic medicines, this progress is also being recognized by both the scientific field and by others in the biotech and pharmaceutical industry. The cargo component of our AAV based genomic medicines are from our zinc finger genomic engineering platform.

Speaker 5

Sangamo's genomic engineering platform has a set of unique properties that in combination allow us to create potential therapeutics That would simply not be possible using CRISPR based systems. Our zinc finger transcriptional repressors are derived from naturally occurring human genes, are compact enough to be delivered or to be packaged and delivered and even multiplex complete with cell type or tissue specific promoters in AAV viral vectors and are able to exert their therapeutic properties without cutting, mutating or otherwise damaging the genome. I'm excited by the progress and the new data we are seeing in our preclinical neurology pipeline. Our recently Announced Nav1.7 program aims to develop a transformative genomic medicine to treat neuropathic pain using our zinc finger based epigenetic repressors targeting the NAV1.7 gene. We are particularly excited about the number of patients that might benefit from this potential medicine.

Speaker 5

There is an estimated prevalence of at least 43,000 patients in the U. S. For our lead indication for NAV1.7 associated small fiber neuralgia, and we believe that there is significant opportunity to expand into other areas. This quarter, we presented a comprehensive package of data evaluating our zinc finger transcriptional repressors in this program. This work demonstrated potent and specific repression of NaV1.7 We have also identified human specific lead candidate zinc finger transcriptional repressors that demonstrate potent repression of NaV1.7 gene expression in human iPSC derived neurons.

Speaker 5

Importantly, we have found essentially no off target activity, including no repression of any of the closely related NAV channels. I'd like to highlight this amazing selectivity versus other NAV family members is a major differentiator of our program and why we believe it has the potential to be both Consistent with this, our most recent data from non human primate models with human specific lead candidates showed significant repression of nav1.7 gene expression in the dorsal root ganglion and all analyses continue to support progression to IND enabling non human primate studies. We are on track for an expected IND submission for this program in 2024. In animal models of prion disease, our other lead preclinical program, we have shown that our zinc finger transcriptional significantly reduce expression of the prion protein in the brain safely extend the lifespan and limit formation of toxic prion aggregates. The final selection process for human therapeutic lead candidates is in progress and plans for IND enabling studies are well underway.

Speaker 5

And as Mark mentioned earlier, our recently announced license agreement with Voyager provides a capsid that we believe will help us advance this important program forward as quickly as possible. For our NAV1.7 and Preon programs, we've chosen capsids that are available to develop today. To maximize the delivery of our epigenetic modulators to the appropriate sites in the nervous system for future programs and some of the most valuable neurology indications, A new and improved generation of AAV capsids is needed. Identifying such capsids has been a focus of paramount importance for the entire AAV field in recent years. Leveraging our long standing commitment and experience in the AAV delivery, we are focused on solving delivery to the central nervous system for a multitude of neurologic targets that need both convenient and broad delivery to the brain.

Speaker 5

Specifically, we have developed a multiplex transcription dependent directed evolution capsid engineering platform called SIFTer. Using this unique selection platform, we are seeking to generate and identify novel AAV variants that exhibits significantly improved either widespread or region targeted transduction and expression in the CNS when delivered by either direct injection or through the blood brain barrier when delivered via the blood. In this last quarter, we presented data describing of multiple novel AAV capsids exhibiting characteristics consistent with enhanced blood brain barrier transit and showing substantial improvement over AAV9 when delivered via blood circulation in non human primates. Also this quarter, we presented new data describing performance optimization experiments that identified 2nd generation variants of our Cerebral spinal fluid administered STACK-one hundred and two capsid that mediate an additional 5 to 10 fold increase in CNS delivery in non human primates. I would also like to highlight that based on our real world experience bringing AV based therapies from bench to bedside, We recognize the importance of including considerations related to scale up and manufacturing early in our discovery process.

Speaker 5

In that regard, analyses also presented this quarter demonstrated improved manufacturing yields for some of these novel capsids when compared to our benchmarks. We are evaluating the 2nd generation capsids individually and believe that they are promising candidates for future potential therapies. As Mark outlined earlier, There may not be a one size fits all capsid that could address delivery to all potential indications. That is why we continue to devote significant resources to developing and characterizing novel AAV capsid variants with enhanced CNS tropism. We believe that this work will drive significant long term value for Sangamo by allowing us to expand the addressable indication space for our epigenetic engineering technology to include major diseases with high unmet need including Parkinson's and Alzheimer's disease.

Speaker 5

We feel a great responsibility to patients to apply our technology to as many potential medicines as possible, and this is reflected by the announcements that Mark spoke about earlier. The recognition we are receiving from other companies and how we are deploying our Zinc Finger technology to be combined with the unique capabilities of our partners is a testament to our commitment to our mission. From taking forward our own internal programs to enabling our partners, we continue to advance the field of epigenetic editing. I will now turn the call over to our Chief Financial Officer, Prathyusha, for an overview of the financials. Prathyusha?

Speaker 6

Thank you, Jason, and good afternoon. We ended the quarter with approximately $182,000,000 in cash, cash equivalents and marketable securities, which represents a net decline of $59,000,000 from the prior quarter. We believe our available cash, cash equivalents and marketable securities as of June 30, In combination with other potential cost reductions will be sufficient to fund our planned operations for at least the next 4 months. We have made some great progress in our business development efforts this quarter as mark our clients and we continue to proactively through a range of options to raise additional capital. Non GAAP operating expenses, which exclude impairment charges and stock $67,000,000 for the same period in 2022, primarily due to the restructuring expense related to the reduction in costs announced this quarter and higher operating costs as we advance our clinical trial.

Speaker 6

As a reminder, Our current investments are being directed towards our 3 prioritized areas of focus: advancing our Fabry program to a potential Phase III trial Progressing Tx200 to Phase III as quickly and safely as possible and the development of our prioritized CNS pipeline. Our detailed financial results for the quarter are available in the press release and 10 Q issued this afternoon, which can be found on our website. Turning to our full year 2023 guidance, we expect our full year non GAAP operating expenses, which excludes certain non cash impairment and stock based compensation expense, remain unchanged and to be in the range of approximately $240,000,000 to 260,000,000 As a reminder, the restructuring we announced at Q1 earnings is expected to result in annualized savings of approximately $31,000,000 going forward. We expect our 2024 operating expense to reflect these savings and to be significantly lower as we further focus our resources in line with our strategic priorities. The readout from key programs will continue to drive decisions and investments in the coming months.

Speaker 6

We will provide further insight into our 2024 guidance and our 4th quarter earnings as per our regular schedule. I will now turn the call back to Sandy for closing remarks.

Speaker 2

Thank you, Prathyusha. As you've heard today, Sangamo continues to execute in a focused strategic manner, driving forward our clinical and preclinical programs with focus and determination. The business development deal signed this quarter demonstrate the broader recognition of our technology and show the importance of both our genome editing and payload delivery capabilities to our wholly owned programs and to potential partners. The productive interactions we've had with the regulatory authorities on Fabry and TS200 continue to further strengthen our faith in these important clinical programs. While we remain dedicated to advancing Fabry and TX-two hundred through the clinic, we're focused on advancing our wholly owned neurology genetic regulation pipeline.

Speaker 2

And I'm very pleased that we've been able to share more of our promising preclinical data in this important area. Importantly, we continue to operate with a strong focus on fiscal discipline and prioritization and recognize the importance of continuing to seek ways to bring in additional funding through a variety of potential channels. Our focus will continue as we reach Operator, please open the lines.

Operator

And wait for your name to be announced. Please standby while we compile the Q and A roster. The first question comes from Maury Raycroft with Jefferies. Your line is open.

Speaker 7

Hi. Congrats on the progress and thanks for taking my questions. For Fabry for some of the Fabry feedback, Can you elaborate on what the 2 studies in the proposed plan for the Phase 3 would entail in terms of patient populations? And are there any other details you can share on size, scope and timing of the two studies? And as follow-up, given you don't think that a head to head versus an ERT is Necessarily, what would FDA use as a comparator?

Speaker 2

Good afternoon, Murray. So thank you for your questions. So I'm going to get Some help from Natalie here, but we're really pleased with the interaction we had with the agency, aren't we Natalie?

Speaker 3

Yes, absolutely. I think we had a lot of clarity on our proposed design and very optimistic about Submitting a clinical Phase 3 protocol optimistically by the end of the year. So very happy with the progress. In terms of your question, we are studying the entirety of the patient population. As you know, the patient population in Fabry disease is heterogeneous both in symptom and treatment.

Speaker 3

And we are our strategy is to address the entirety. So we had proposed 2 studies. They address both the naive and pseudo naive population and the patient on ERT. We are seeking additional clarification on some of the feedback we received Just to finalize our Phase III strategy, but we can share that we do not need to do an ERT comparator with the naive to the patient and that we will share additional detail on the detail of the Phase 3 protocol at a later date.

Speaker 2

And Maria, I know you know this, but the whole process of getting having these interactions with the So it is very normal for us then to go back and make sure we fully understood what it is we believe they've said. So this the response from the agency only came very, very recently and therefore we are still in the middle of that process.

Speaker 7

Got it. Makes sense. And so for those two studies, would they start at the same time or be staggered? Anything additional you can say

Speaker 2

We're doing our very best to get them both going as quickly as possible and we'll give you more details on that at the right time.

Speaker 7

Okay, sounds good. Thank you very much.

Operator

Please standby for the next question. The next question comes from Luca Izzai with RBC Capital. Your line is open.

Speaker 8

Great. Thanks so much for taking my questions. Maybe a follow-up on more questions there for Fabry. It sounds like you have Great alignment with the FDA on naive and pseudo naive patients, which is great news. However, what's the plan to go after patients that are actually on ERT?

Speaker 8

What is the FDA asking there? Again, any color would be much appreciated. And then maybe on hemophilia A, can you just give Excited about their subcu monoclonal antibody, marsizumab, and maybe a bit less focused on gene therapy, but would love if you have A different view here and maybe related wondering if you have any plan to monetize that royalty stream? Thanks so much.

Speaker 2

Thank you. There's a lot to answer in that single question. So I'm going to suggest we do it in reverse order. So Mark, can you talk about hemophilia? And then can you maybe reflect on the epidemiology of Fabry about the patients that are on and the patients that are not on ERT?

Speaker 2

And then Natalie, perhaps you can comment on the ERT patients. So Mark, if you start with hem

Speaker 4

For hemophilia A, Pfizer has not changed their guidance. They anticipate having the Top line data sometime in the first half of twenty twenty four and they are still guiding on submitting a BLA in the second half of twenty twenty four. The interactions that we have with them are consistent with the fact that they're continuing to move that program forward. So we're Very excited about the continued progress on that. We're not going to comment right now in terms of any monetization of the royalties.

Speaker 4

We've guided on what the royalties and milestones are in the past. And if something changes, we'll provide an update. But as we've talked about, it is an option for us should we need to extend our cash runway. And Mark, do you want to fabric? Yes.

Speaker 4

Yes. So as I think we've talked about before, Luca, if you take a look at the database that we had on Fabry patients, there are about 4,000 patients that have got a diagnosis of Fabry in this particular database. What I find striking is that there's At the best case scenario, there's only about 1800 patients that are engaging at any given time with over the course of the year with the healthcare providers And that's measured by at least 2 to 3 visits per year. But at the low end, sometimes it's as low as 1300. So the way I sort of triangulate that is, There's roughly 4,000 patients that have had a diagnosis.

Speaker 4

Clearly around 2,000 have not And prescribed any therapy right now, so they're probably just being monitored by the physician. There is probably about 1800 that have been put on enzyme replacement therapy. Those are the ones that are regularly going in. But when you take a look at the compliance rates, There were kind of all over the place. And so you've got in any given month, you've got as low as 1300 patients that are going in on a regular basis.

Speaker 4

And so when you think about the pseudo naive and naive population, a substantial number of the patients All into that particular category, the number of patients that are compliant with their regular enzyme replacement therapy is A fairly small number of the totally diagnosed population.

Speaker 2

And Natalie, how are we going to so you've Said that the naive pseudo naive will not need a comparator study, which is great news. And for the those are On ERT?

Speaker 3

So we're seeking clarification from the FDA on some specific question in order to finalize our proposed Phase 3 trial protocol for the ERT patient. But needless to say that we really have An exciting potential passport for both population naive, pseudo naive as well as ERT patient on ERT.

Speaker 2

And look at the ERT patients are important because we believe that gene therapy will be a much better Patient proposition for them avoids them having to go every 2 weeks. In the studies that we've done the patients that come off of ERT, their quality of life goes up, they feel better, they're staying off ERT, we're over a year and some of these patients are that we're on in ERT and so we feel an obligation to address them. We need to ask some more questions of the agency and we'll let you know as soon as we can What the DESIGNOLAP study will look like.

Speaker 8

Thanks so much. Very helpful.

Operator

Please standby for the next question. The next question comes from Greg Harrison with Bank of America. Your line is open.

Speaker 9

Hey, good afternoon. Thanks for taking the question. For the Fabry Phase 3 trial, What would you expect the timing to be on the turnaround after you submit your protocol to FDA? And how does the initial demand for patient enrollment look like?

Speaker 2

We have great engagement with the patient support groups. The patients in the current clinical trial are coming to us very eagerly to get this medicine. So, Nathalie, if we Submitted the end of the year, what are we guiding to?

Speaker 3

So the FDA will have 30 days to review the protocol And then give us some comment or go ahead for the Phase 3. And then needless to say, we are preparing our operation team for having a start as soon as possible after we have agreement with the FDA on the final protocol.

Speaker 9

Got you. And then if I could sneak one more in, what assumptions are baked into your cash runway guidance over the next 12 months? And would you consider partnering any of your wholly owned programs that's on the road to take the partner?

Speaker 2

Patricia, can you take that one?

Speaker 6

Sure. So our cash balance at the end of the quarter was 182,000,000 And we are projecting that it would fund our operations for at least 12 months. As far as what assumptions, I mean, you have to keep in mind that The guidance for the it's for 2023, the $240,000,000 to $260,000,000 And the restructuring that we did in Q1 we announced in Q1 and we've executed is expected to result in at least $30,000,000 of savings. So we haven't shared our guidance yet for 2024, but along with these savings, we expect The spend for 2024 could be significantly lower. And as far we're looking at as Sunny alluded to In the call, right, we're looking at several options, both from a funding perspective and we're really encouraged by the partnership market opening up.

Speaker 6

And also we're looking at how do we further streamline our OpEx.

Speaker 9

Great. Thanks again for taking the questions.

Operator

Please standby for the next question. The next question comes from Jenna Wong with Barclays. Your line is open.

Speaker 10

Thank you for taking my questions. Just want to clarify The FDA specific additional clarification question from FDA, that's only regarding the ERT Phase 3 trial design?

Speaker 2

Thanks for the question. It's We have the opportunity to clarify everything the agency tells us. And It's important to take this opportunity because it's such an important piece of information. So We were able to go back and ask across the whole range of things they commented on.

Speaker 10

Okay. Is there any Preclinical data or clinical data clarification or request from the FDA before the Phase 3 trial

Speaker 2

Nathalie, I think we can answer that one.

Speaker 3

Yes. So, no, there is no preclinical Data that needs to be added and we have a clear path forward on the data for starting the Phase 3. So I think we have clarity on both of those.

Speaker 10

Okay, great. And then very quickly regarding the AAV capsid, can you elaborate a little bit like a Voyager's IV administered CNS target AAV compare contracts to your own internal CNS target AAV capsid.

Speaker 2

So let me pass over to Jason. But just before I do that, we are very careful to keep The team's clear that they're working either on a Sangamo capsid and Voyager capsid. We are very grateful to Alan and the team at Voyager for Put the information from them together, it's a very important partnership point to make. Jason?

Speaker 5

Yes. So regarding the Voyager capsid and that partnership to develop a therapy for prion disease, We've been extremely excited about the data that we've generated through our collaboration with the Broad Institute and MIT in animal models of prion disease. And we've received really uniformly Positive feedback from the community on the potential there. And when we saw the progress that Voyager had made in their IV administered capsid, We believe that it was really the best way to get that drug to patients in the quickest way possible. And if you Understand the need in prion disease, I'm sure you'll appreciate why we felt it was so important.

Speaker 5

This is a devastating disease where Where people can die extraordinarily quickly. And so our motivation there was really around getting that to patients as quickly as And we thank Voyager for their partnership there as they also recognize that. Nonetheless, we also have a major effort in developing our own capsids And we've seen a lot of progress there. I mentioned the work that we've shown at ASGCT. We continue to make lots of improvements and we're very optimistic that over the course of the next year or 2, we're going to see some major developments from our own programs.

Speaker 5

And so as we look at our pipeline, we reflect on when we need to commit to a capsid, what capsids are available, And we make choices in a strategic manner to advance the pipeline, recognizing that we have to combine capsids with a cargo and each case could be unique and we need to maximize our probability of success, but also maximize our potential to move things forward in a reasonable amount of time. So it's a multifactorial decision, but we believe that we've got our own capsids. I think the partnership with Prevail and Lilly emphasizes that others in the community are recognizing the strength of our own capsid development program, but at the same time, if there's a need to move something forward more quickly, we're always open to doing that.

Speaker 10

Thank you very much.

Operator

Please standby for the next question. Our next question comes from Anvita Gupta with Cowen. Your line is open.

Speaker 6

Hi, guys. Thanks for taking our questions. Firstly, on the Fabry program, how many more patients are you planning to dose in the Phase III And does the FDA want to see any additional data from these patients before possibly signing off on the Phase 3 To the 2K3 designs and I have a follow-up.

Speaker 2

Natalie, can you deal with that?

Speaker 3

Yes. So we are continuing to enroll patient and dose patient in the Phase III study, But we do not depend on this data to start a Phase III plan and protocol. Is there any additional data that we need for starting the Phase III trials It's something we are not sharing at this point, but we'll provide clarification at a later point.

Speaker 2

I think it's important to realize that this Could be a Phase III study of up to 30 patients and it will be incredibly supportive when we file the BLA from the Phase 3 data because those patients will be showing benefit we believe for years And that will give that longevity data that the agency, I'm sure, will be very pleased to see.

Speaker 3

Yes, they will be part of the durability and safety database for BLA filing.

Speaker 10

Got it.

Speaker 6

And then secondly on TX200, could you give us some sense of what to expect from the initial data guided for year end? Will there be any biopsy data? And if so, What are we looking for? Thank you.

Speaker 2

Lisa, can you take this one?

Speaker 11

Sure. Thanks for the question. So as it is a primarily a We would be presenting some of that data at the end of the year and we're not going into details about What additional data we may present as well?

Operator

Please standby for the next question. The next question comes from Nicole Germano with Truist, your line is open.

Speaker 12

Hi, good afternoon and thanks for taking my question, and congrats on the progress. So just two quick ones on the CAR Treg platform. So a couple of investors have expressed some concern that the immunosuppressive agents given to Patients may suppress IL-two production. Can you help us understand the use of immunosuppressants in the study after TX200 infusion? And my second question is on, there's a lot of interest in the IBD space from big pharma and several companies with CAR Treg platforms are partnering off their IBD programs to big pharma.

Speaker 12

Can you just remind us the progress with your CAR Treg program in IBD and potential timing for IND?

Speaker 2

So I'm going to suggest Liza takes the clinical technical question. Mark, do you want to talk about how The interest there is in Tregs in general, but if Liza goes first.

Speaker 11

Yes, sure. Thanks for the question. So you're we are using standard immunosuppressive therapy regimens in the study And following the adaptation in those regimens over time. So we haven't actually heard that there have been any concerns related to the related to the regimen that we're using because it's standard of care, standard of practice. So we're following In terms of the clinical outcomes, looking at evidence of rejection as well as the patterns of immunosuppressive therapy used by the investigators.

Speaker 4

Mark? Yes. So In terms of interest in Tregs, we've had a lot of inbound interest from potential partners for the Tregs. And I think as we've communicated before, We have a lot of investors that are looking for opportunities to create a mechanism for them to invest directly into the CAR Treg platform because of the potential and obviously our leadership in that. And so we are looking at Both of those we're having conversations with partners, but we're also taking a look at mechanisms to allow for And we'll provide an appropriate update at that time.

Speaker 4

But yes, there is a lot of interest in the CAR Tregs and the progress that we're making. And At this point, we still feel that we're the furthest along in terms of the dosing of patients. And as Natalie commented on, we'll hope to provide an update in terms of what data or actually Lisa said, what data will potentially be able to show by the end of the year.

Speaker 2

And that's what we hear From the people that come and talk to us about it that we are the furthest along. We're the only one that's talked about being in the We're the only one with GMP manufacturing in Valbonne that allows us to control the process. We're the only one with an editing capability and we are the one that's got the experience of doing INDs and cell and gene therapies. So that's why They like what they're seeing at Sangamo in the Tregs and we do look forward to sharing the data. As Lisa says, this is a safety study 1st and foremost.

Speaker 2

This is the first time CAR T regs have been given and it is remarkably well tolerated.

Speaker 12

Great. Thank you so much.

Operator

Please standby for the next question. The next question comes from Union Zhu with Wells Fargo Securities. Your line is open.

Speaker 13

Hi. Thanks for taking the question. This is Quan on for Yanna. So two questions from us. The first one is on battery.

Speaker 13

So for the Phase onetwo STR, do all the ERT withdrawal patients remain off ERT? And then the second one is on TX200. So besides safety, what does the company need to see to move The program forward and how many patients of data would be required for the company to make that decision? Thank you.

Speaker 2

Thank you as always for your question. Natalie, Fabry, an easy one.

Speaker 3

So yes, all the patient in on ERT in the Phase III that have withdrawn ERT remain off ERT. So I think that was the first question. And the second question was?

Speaker 2

On Tx-two hundred.

Speaker 11

Okay. Yes. So your question was about what safety data do we need to see to move the program forward. Well, thus far, as Natalie mentioned, we've already dosed The first three patients in the first dose level and there were no DLTs and we were had a clean Opinion from the SMC to open the 2nd dose level and now we're expecting to dose that patient within this quarter sorry, within the next quarter. And I think that I can say that we've been very encouraged by the safety data that we've And this has also allowed us to move forward with the protocol amendment to potentially advance patients more quickly through the different dose levels.

Speaker 11

So these are all encouraging. In terms of long term, we'll have

Operator

Please standby for the next question. The next question comes from Patrick Trujillo with H. C. Wainwright. Your line is open.

Speaker 14

Thanks. Good afternoon. Just a few Follow-up questions from me. The first one is just that you can discuss what remains to be completed in the NaV1.7 program, particularly on the manufacturing side of the Location ahead of an anticipated IND submission in 2024. And then, secondly, just Comments early in the call regarding increased interest from potential collaboration partners.

Speaker 14

I'm wondering if you can discuss what aspects of the platform you're receiving the most interest on and what form Potential future collaborations could take and if there are specific programs in earlier stage development that you might look to partner.

Speaker 2

So Natalie, can you talk about what's left to do in NAV 1.7 and then Jason will talk about his passion for the platform?

Speaker 3

Yes. So we're really excited about the 9,117 and really gearing to our IND in 2024. The two things that are the two main things that remain to be completed is the GLP talks to be able in a non human primate and this is well planned and underway to be completed for an IND next year. And in term of the manufacturing component also, we are underway to manufacture, the clinical lot to be on time for the 1st patient in the trial. So at this point, the team is working fiercely To stick to this time line, but we foresee no delays.

Speaker 2

And Natalie, although we still have Through the GLP tox, we've already done the dose ranging study.

Speaker 3

Yes, we have done the dose ranging study. So this is the normal development path where we need to have this

Speaker 2

And the talks was there was no issue?

Speaker 3

Absolutely. It was beautiful.

Speaker 2

Okay. Thank you, Natalie.

Speaker 5

Jason? Yes. So in terms of inbound partner interest, it covers a wide area. We've already talked about our Treg platform. We've seen lots of interest from many Different potential partners in our advances there and particularly around the capabilities that we've built There that go all the way from designing cars to manufacturing cells and then running the trials in patients.

Speaker 5

So Lots of interest around Tregs. There are a variety of indications there, some of them very large and we recognize that we can't We run all of those studies ourselves, so we're always in discussions on that front. I'd say the next area where there's been quite a lot of discussion is around our zinc finger platform. One of the interesting things about ASGCT this year was that there seemed to be kind of a renewed discovery of something that I think we at Sangamo kind of have always known is true and that is the value of the Zinc Finger platform for developing therapeutics based on the real tunability, the specificity, the compact nature of the proteins. And so we've really had a renewed interest from lots of different companies with different platforms that want to pair Their technology is with our zinc finger programs.

Speaker 5

One way that we kind of evaluate those programs or those collaborations is how they fit into our strategy. So, as we've talked about a lot today, moving forward, we have a strong focus on in vivo Genome Engineering in the Neurology space. So, one of the first places that we are always very open to platform always very open to partner is to enable companies that are working outside of the neurology space and providing them with the cargo, our zinc finger Cargo for their programs. When things get into the neurology space, we have To think through in a smart way, what areas do we really want to focus on? Where can we execute the soonest to drive value for the company?

Speaker 5

And if there are areas where we feel that there are other companies that can move things forward quickly and that would ultimately benefit both patients and Sangamo, And we're always open to those types of collaborations. And then I would say the last area, also That has been highlighted by the deal with Prevail is the work that we've been doing on our Capsid Evolution platform. This is an area that over maybe the last 2 years, we've been seeing lots of really great data from the team And things are progressing very fast and we're very excited about it. And it's an area of that as we mentioned earlier, the whole field is looking for these types Because there are lots of diseases that need the right delivery platform. And if there's an indication that we're not going to to ourselves, but someone else is interested in doing it and we have a capsid that's able to facilitate that and we're happy to have those discussions.

Speaker 5

So really, I'm tremendously proud of all of the work that's going on in the research and preclinical teams to To move our Zinc Finger platform forward, our capsid evolution platform forward, the Treg platform, lots of advances And I think we're getting inbound interest in all those areas.

Speaker 2

Well said, Jason. I know you spend a lot of your time talking to prospective partners And are always talking about how excited they are by the science they see.

Speaker 14

Great. Thank you so much.

Operator

I show no further questions at this time. I would now like to turn the call back to Louise Wilkie for closing remarks.

Speaker 1

Thank you once again for joining us today and for your questions. As a reminder, you can access the earnings release and presentation on the Investor Relations section of the Sangamo website. We look forward to keeping you updated on our future developments. Thank you.

Operator

This concludes today's conference call. Thank you for participating. You may now

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Earnings Conference Call
Sangamo Therapeutics Q2 2023
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