Editas Medicine, Inc. (NASDAQ:EDIT) Morgan Stanley 20th Annual Global Healthcare Conference Call September 12, 2022 10:30 AM ET
Company Participants
Gilmore O’Neill – President and Chief Executive Officer
Mark Shearman – Executive Vice President and Chief Scientific Officer
Baisong Mei – Senior Vice President and Chief Medical Officer
Michelle Robertson – Chief Financial Officer
Conference Call Participants
Matthew Harrison – Morgan Stanley & Co.
Matthew Harrison
Great. Well, good morning everybody. Thanks for joining us for the next session. I’m Matthew Harrison, one of the biotech analyst analysts here at Morgan Stanley. Very pleased to have Editas with us for the next session.
Just briefly, before we get started, I need to read a quick disclosure statement. Please note that all important disclosures, including personal holdings disclosures are available at the Morgan Stanley public website at morganstanley.com/research disclosures.
Question-and-Answer Session
Q – Matthew Harrison
Now, with that excitement out of the way, we can get down to the real business. So really pleased to have the team here with us. I thought maybe a nice place to start is just there’s so much innovation in gene editing going on. And I think from an investor standpoint, there’s a lot of different modalities now in gene editing. So, can you talk a little bit about how you think about your underlying technology versus some of the other CRISPR companies versus the base editing companies versus the prime editing companies, et cetera, and just give us a context for how you think about technology and where your strengths are.
Gilmore O’Neill
Sure. I’d be delighted to. I have been at Editas now as CEO for just the last three months. But this is one of the things that I really addressed in my diligence before joining the organization and spent a lot of time looking at this. And one of the things that stands out to me, and I’ll ask Mark to comment as well, was that in the CRISPR space, Editas has an AsCas12a enzyme. In fact, it is the nucleases enzyme that we use to carry out specific EDITs in our 301 program, for example. And many of our discovery programs used the same enzyme. Why does that matter? It is actually distinguished for several reasons from the Cas9 enzyme, which is at the core of many of the technologies within the CRISPR, including prime and base editing.
And the key thing is, is that it is an engineered enzyme that we have worked on to increase both this fidelity and efficiency. And why would that matter? Well, I think I’ll pass it to Mark, just to take a little bit through about what really distinguishes AsCas12a.
Mark Shearman
Great. Yeah. So, the engineered version of the enzyme combines both high on target activity and specificity, together with a guide RNA that we can synthesize in a very high fidelity and pure way. And so, I think what this means is that we essentially can very carefully control on target editing and with a suite of bioinformatics and computational biology software know exactly where the editing is occurring and basically to define any potential off targets where in many cases by design eliminate them. So, this has been particularly important in our cell therapy based approaches Edit-301 being the ex vivo autologous therapy for sickle cell disease. We have very high levels of control, exactly what’s going on. And we’ve got the data to prove that in both sickle TDT and control patients.
Gilmore O’Neill
And either are a number of factors that actually drive the specificity and efficiency, one, the innate properties are of the nucleases itself. But in addition, there are certain differences with regard to the guide, RNAs used. The AsCas12a uses a smaller 41 mer on average guide, whereas the Cas9 uses a 90 to 100 mer. That in itself matters from a quality and purity point of view. And also the AsCas12a guiding or targeting sequences three prime, which is where synthesis initiation starts. Whereas the Cas9, which again, is at the core of most of the CRISPR technologies, uses the guide sequencing of the RNA or the targeting sequences of the five prime end.
Mark, you may want to explain a little more about that.
Mark Shearman
Yes. I think where that becomes really important is the synthetic chemistry around the guide and the ability to control that. I mean, by the nature of the technology, there are some errors that can be introduced, but those errors tend to be amplified at the five prime end. So, when you are comparing the technologies, we have a greater control over the exact specificity of the guide. As Gilmore mentioned, the binding of that guide to the enzyme and then the location of that guide next to the PAM sequence in the targeting — in the targeting region that you want.
Matthew Harrison
Okay. Okay. Great. That’s very helpful. And I think good context for everybody. So, Gilmore, you mentioned that you recently joined as CEO and maybe I should have started with this. But you talked about Cas12a is one of the things that led you to the company. Can you just broadly talk about, why you’re excited to be here and what led you to the company?
Gilmore O’Neill
Absolutely. So, the technology itself, just in general, the ability to doable or programmable genome editing just has enormous potential. And I wanted very much to be part of unlocking that potential. Editas specifically drew me in. AsCas12a was one differentiator, another important set of elements included a significant investment and resourcing and expertise, which I would call core differentiate expertise in guide RNA chemistry and synthesis.
In addition, on the CMC side, the organization has actually capabilities, both internal and through external collaborations and capacity growth to synthesize a number of different technology platforms, but very importantly had — again, a significant resource commitment to analytics and quality, which I’m sure as you watch the space, particularly when you’re talking about innovative therapies in line with CRISPR like technology, is incredibly important to make sure one can make clinical scale material that is frankly acceptable to regulators and quite particularly the FDA.
In addition, I was drawn by some significant scientific expertise within the organization, some wonderful scientists here and obviously a great executive leadership team. I was also drawn by the challenges/opportunities, every challenge and opportunity. And one thing that really Editas was — is — has been very open about, is really doubling down on clinical execution. And I saw that as an enormous opportunity, both with my past experience of bringing actually six compounds across the finishing line and at multiple global approvals, but actually also an opportunity to bring in some real talent, which is, I was so happy. I think within six weeks of joining to have recruited Baisong as our Chief Medical Officer, somebody who has brought four compounds across the finishing line for global approvals and actually has a broad experience across the value chain from discovery, CMC and clinic, a rather unique skill set and indeed has invented no less than two compounds, one of which has been approved. And the other of which has actually going through review.
So, the combination of the opportunities and the challenges, such opportunities and the differentiated capabilities and technology, really what drew me in. And since I’ve been there, I’ve been happy to confirm those impressions, and at the same time work with the executive team to really think about reevaluating, refocusing, reprioritizing strategy, which we are planning to share in the coming month.
Matthew Harrison
Okay. Great. Great. I guess, probably just the last sort of overarching question is just, people are aware that there’s a lot of IP back and forth in this space. And over the last, I would say year or so, you’ve been able to sort of solidify your IP position in this space. So, I think the question is less about freedom to operate and more about from a business standpoint. Do you think about monetizing that IP? Do you think about that being a potential revenue stream at that part of a potential business plan as you think about the company?
Gilmore O’Neill
Yes. We do. We do think about it, amortizing from a revenue point of view. We look at it from an upside point of view, but notwithstanding clinic and upside, we are actually very confident about our position. We are exclusive license holders from the Broad Institute for the IP around Cas9. And we believe as a result that any sponsor commercial or bio sponsor planning to launch a therapeutic using Cas9 will have to come to us for a license.
You talked about the back and forth. There are two elements to back and forth. The first is that we have — the IP has been reviewed by PTAB twice, where Broad and thus ourselves have prevailed. It has been viewed once already by the federal appeals court. It is now in the federal appeals court for one final time where they are focusing on the application of the law by PTAB. There is no dispute around the facts. They would not be reviewing the facts. And so, we remain very confident that when the decision reads out mid to late next year, we’ll prevail, that’s one back and forth.
I think the other piece I want to be sure is, is that I think there’s been talk we’ve heard of sort of quid pro quo there. We don’t believe there’s quid pro quo. Not least of which, because we believe the United States is the dominant market for innovative medicines. And we also believe that our 301 program is differentiated and not at stake here because it uses AsCas12a. We do have Cas9 in our autolo programs, but those are smaller indications. And so, where we actually see sort of a dominant or important source of potential value sits with our Cas9 IP within the United States.
Matthew Harrison
Okay. And maybe just to follow-up on that just to clarify a couple things, just for everybody’s benefit. When you say quid pro quo, you mean that you might have to license somebody else’s it? Is that what you were talking about or …?
Gilmore O’Neill
Yeah. So, sorry, just because I think people have talked about like, quid pro quo for U.S. versus rest or EU, we have claims in the EU, but we believe certainly for Cas9 that we may need to actually have some other licenses. However, the important point is when you actually look at our 301 program …
Matthew Harrison
You’re saying for 12a.
Gilmore O’Neill
And we do not need it.
Matthew Harrison
Yeah. Okay. Okay. Perfect. Now that’s helpful. Alright. Good. So, you talked about sort of doubling down on the clinic. You’ve got a couple clinical programs, so why don’t we flip to them and make sure we go through them in detail.
So, I guess the first one is, is BRILLIANCE. Just sort of remind people where you are with that study. What we — what you think you know about that program so far, and then the update that we’re expecting here on the second half, what should investors expect to see?
Gilmore O’Neill
Absolutely. And I may actually ask Baisong to add some to that, but I think the first thing I’d like to do is just pause for a second and actually make two important points. One is that BRILLIANCE is an interventional Phase 1 study. We also have a natural history study with nearly twice as many patients, and we’ll return to that, because that’d be important for contextualizing the BRILLIANCE data.
The other key point is that the BRILLIANCE study is a Phase 1 study designed to do much more than many studies are, largely because we are targeting and intervening in a rare, largely undescribed study clinical disease, which is LCA10. And the objectives of the study, beyond just looking at safety, of AV targeted Cas9 in the retina is to helps identify a segment or a subsegment of the patient population that is most likely to respond. And that is a patient population that we could identify at priority using baseline characteristics, including genotype, clinical structure or physiological parameters, as well as to identify endpoints that are meaningfully useful in a pivotal study; and finally, determine the magnitude effect and move beyond proof-of-concept and look at proof-of-product is there actually a path forward, not just more regulatory from a commercial point of view. And all these elements we pull together ultimately to help us design a pivotal study that we could bring to regulators.
But maybe Baisong you could add a little more.
Baisong Mei
Yeah. Yeah. Thanks. Yeah, Gilmore. I think just continue what Gilmore mentions. And this is like a Phase 1 study. Of course, we have a focus on the safety, but we actually have a lot of endpoint to look into the efficacy of this EDIT-101 in those patient population. So, we’re looking from license sensitivity to vision — visuality, as well as the vision function navigation score and all those in there too.
Another important piece is actually the quality of life and portion report outcome, because some of the subtle difference can be translated to that daily life difference in there too, from quality of life there.
I think another important piece is we actually have a significant size compared to the size of population of natural history study. This will really allow us to contextualize to see, okay, what this BRILLIANCE study mean after the treatment versus what has been in the natural history. We actually have a 12-month perspective observation of the natural history over 20 patients on that too. So, those will be the important piece for consideration as Gilmore just mentioned.
Gilmore O’Neill
Thanks Baisong. And I think there are two key points, we will be sharing. We’ll be sharing data in the October/November timeframe. And I think just to remind everyone that this is not a diabetic retinopathy DME or AMD study, that is because these — vast majority of LCA patients, not surprisingly congenital amaurosis, have profound visual impairment by the time they’re two or three. And so, what is meaningful to them is the ability to live an independent life, to navigate a room as dark as this or as bright the rooms, where without injuring themselves.
And so, one of the points that you probably heard, I just want to make sure to emphasize it is beyond visual acuity as a clinical outcome measure, we look at things like a visual navigation of course and quality of life actually also helps us anchor those outcomes together. And we’re looking at supportive measures such as OCT to look at structure, both at baseline and after treatment, as well as physiological parameters and psychophysical such as the full field sensitivity test as a measure of restless sensitivity.
Matthew Harrison
And so just to remind everybody, you, obviously, will have more dose levels than the previous data. And you’ve also dosed different age groups than the previous data, any differences to think about either of those factors? And I guess, the ultimate question here is like, given what you’ve described, right, this is not a study where you can have sort of one very clear output, which tells you whether or not the therapy is clearly working. So, how are you defining success for this study?
Gilmore O’Neill
So, just so people know what to expect from what are the data, we will be providing data, safety data from all low dose, mid dose, high dose adult, mid dose pediatric. Our efficacy data will focus on 12-month data from the mid dose adult cohort six month data from the high dose adult cohort. And what we will be looking for from a success point of view is identifying a segment of that patient population that response. And we’ll be looking to determine if we have a congruency of the number of parameters to actually show a benefit, a meaningful benefit to patients.
The one other point I would just make is, is that we are being very — we’re using our precision measures if you will, including genotyping structure physiology, et cetera, to really be as precise in describing patients as possible. Age is a good if somewhat crude surrogate, but we really want to actually understand is the nature of the substrate that patients have preserved for us to rescue, as well as other elements of function that could again, help us at baseline determine going forward at priority a kind of patient or subsegment that’s going to respond.
Matthew Harrison
Okay. Okay. Great. And then, probably a question you get a lot, obviously, there was a gene therapy treatment in this space, which didn’t sort of meet its primary endpoint in a study. What’s the impact to you of that? I mean, is that relevant, or is that not relevant because of the mechanism of action?
Gilmore O’Neill
I think there are a couple of elements. I think, first of all, I under — BCVA was chosen as the primary outcome measure, which I think there’s some risk associated that when you’re talking about a congenital amaurosis, whereas I said patients profound visual impairment before, particularly because even though you can measure BCVA costs, a wide range of log mars, the precision and the dynamic range with the ETDRS, which is frankly, the card. Well, based on your age that most of us looking, certainly few of us up here look at, maybe others down there don’t, is very precise. Once you move beyond that, the dynamic ranges get a little more challenging. So, I think that creates the challenges from behavior. In addition, it’s meaningfulness to patients, is really something that we would question.
And then finally, obviously, the mechanism of action. Targeting the transcript as opposed to targeting the genome are very different and the delivery challenges are different between the two therapeutic modalities. So, design, modality, mechanism, I think all probably played a role, which is why we would separate that from what we think. And in many ways, I think the only point is, is that there are now, frankly, more patients who unfortunately are still waiting, but then actually are patients to whom maybe we give some hope.
Matthew Harrison
Okay. And then, I guess, just more broadly as we’re talking about the eye before we move on to hemoglobinopathies, what’s the level of commitment to investment in eye diseases, obviously when the — when a couple years ago, right, I mean, that was sort of the major theme. I think you you’ve got a broader pipeline. Now, there are other options and maybe that’s part of what your reviews going to talk about later on this year, but maybe if you can comment.
Gilmore O’Neill
Well, without going into too much detail, I think it wanted to look at the big picture or a vision for a company like ourselves, which is bringing an innovative and novel therapeutic modality and you’d hear this I’m sure from others, is to actually, first of all, have an ambition to scale to where you can treat genetically determined diseases in large populations, because that’s truly transformative. But the best way to start, a prudent way to start is to start with small populations in people where you can optimally manage the risk while you fully understand the risk of a new modality, particularly one where you have to think about off target editing, etcetera.
And so, the eye actually was a very good and interesting approach to actually determine that. And we have other programs which we haven’t disclosed yet, which actually are in the eye, but actually also the eye we see as a stepping stone to beyond in the in vivo space. And we’ve talked about in the past about expanding beyond the eye for therapeutic indications and beyond AV for delivery.
Matthew Harrison
Okay. Great. So, why don’t we jump to hemoglobinopathies. And probably the first question people will ask is, there obviously a couple programs, there’s gene therapy programs in hemoglobinopathies, there’s another CRISPR program. As you highlighted at the beginning, you’ve taken a different approach from the Cas, from the location of the site that you’re editing. I guess, why because there’s obviously a handful of reasons for that.
And then, a second, how do you think that might play out clinically, as we start to see some of the initial data herein?
Gilmore O’Neill
So, I’ll kick off and then I’ll pass it to Mark and Baisong to take it through more granular detail on the science and the clinical implications. But the key answer is, is that we believe we have a differentiated approach, not just because AsCas12a, and it’s higher fidelity and higher efficiency. But in addition, we are targeting not the BCL11A directly, but the binding site for the BCL11A suppressor on the promoter for the gamma globin genes 1 and 2. And that is because, as Mark would explain, expression of gamma globin through this approach is independent of stress apheresis as well as we believe potentially better erythroid health.
And we base that on both — you asked the why did we choose that? We base that in empiric experiments in the lab, as well as published literature from other labs around the world. Why does that matter? Because in the end, we believe that we’ll translate into more robust, fetal hemoglobin expression and more durable fetal hemoglobin expression. Why does that matter? In the medium to long-term, we would expect to have an impact on quality of life, exercise tolerance, for example, as well has long-term and organ health around cardiac, renal, brain function.
But I’ll ask Mark to talk a little more about the elements of the science underpinning that, and then Baisong to talk about the clinical pull through.
Matthew Harrison
Great. And Mark, just as part of your answer, could you maybe comment a little bit on whether or not you think that could also lead to differentiation in safety as well on the site that you’ve chosen.
Mark Shearman
Sure. To answer your first question, the choice was really made on data. We did the head-to-head comparison and in our hands, we felt that editing, what we call the capsid box of the promoter, was superior to editing the BCL11A itself. And in particular, we’re — the approach we’re taking is substantiated or supported by natural human genetics, right? So, we’re essentially trying to recapitulate a condition called hereditary persistence of fetal hemoglobin, where these are sickle cell patients who fortunately for them sort of coinherit another mutation, which increases hemoglobin combats for sickling phenotype. And so, using AsCas12a, which has a staggered cut at that site, we introduce changes, which very effectively recapitulate the hereditary persistence because of fetal hemoglobin mutations and therefore elevate HBS in a very consistent way. So, that’s, the sort of the primary.
And then your second question was around …
Matthew Harrison
Safety. There’s any reason to think as opposed to primary lighting BCL11A if you have a different — whether short-term or long-term data as well.
Mark Shearman
Yeah. So, there’s some direct effects that you could imagine on editing BCL11A directly since it’s a repress approach that’s known to be involved in BCL leukemias. But specifically for us, again, going back to Cas12a, we know from our own work that we are only editing on targets. So, we’re only editing the exact sites we want to, and we fully characterize that profile, which is actually recapitulated very effectively in both sickle cell disease, TDT and human, TD 34 cells. So, we have a very precise editing approach that introduces the changes that we want that recapitulate the naturally occurring disease, naturally occurring recovery that we would want to see.
Matthew Harrison
Okay. Perfect. And sorry. So, you obviously answered safety for you. I guess, I was asking to compare potential safety of other methods that directly edit BCL11A versus yours. And if you think there could be potential for whether short-term or long-term differential safety by that approach.
Baisong Mei
Yeah. Maybe I can pick up from clinical perspective. So, as Mark mentioned earlier that our Cas12a, one of the factor mentioned that is actually we have a shorter guide on. And that shorter guide, I not only that is, is shorter and have high fertility from synthesis perspective, but also the binding side is on three prime end, because the synthesis is actually also from three prime end, this give us high fertility of that. They will have the potential — we will not do clinically, but always have the potential on it and we see the data that to have much less potential for off target. So, that’s kind of one thing from safety perspective, right? So, of course, then we have the clinical data.
And the other thing is that we are targeting the promoter region of the HBG 1 and 2, that is a nature process being validated in the nature occurrence in there. And then, also that have — do not require the stress anemia for the expression of the fetal hemoglobin. This could also be from clinical safety perspective. There’s another aspect of that too.
Since I’m on this, maybe on top of that is to see we — from differentiation perspective, we are hoping that with this combination of Cas12a as we as finding manipulating in the promoter region, we will have higher and sustained and durable fetal hemoglobin expression. And this will hope will train translate to better quality of life and minimize long-term organ damage from that perspective, from clinical outcome side.
Gilmore O’Neill
If I might close the loop, just your question around the differentiation in sort of the family or the pathway of CRISPR approaches, obviously looking beyond just sort of an INDEL approach, which we are using along with, for example, CRISPR. Again, the key differentiator I would — sits with the AsCas12a. When you go to a targeted base editing approach, for example, there are a number of things that are important highlight, which where AsCas12a differentiate, first at the core of that fusion is a enzymatically dead or kinetic dead nuclei or Cas9 nucleases to guide.
In addition, there is a conjugated deaminase, which while tied to, or fused to a targeting, is a little promiscuous from the point of view of which an example of an adeno deaminase, if it is in proximity adeno, it will edit it. So, those are elements are important differentiating elements. Obviously, we will see how they pan out in the clinic. But as I say, ultimately from a differentiated benefit risk, we believe that the parameters that we have designed based on both empiric data from our lab and others could translate into long-term benefits from patients from quality of life and organ health.
Matthew Harrison
Okay. Great. And Maybe just to round us out, because we’ve got about a minute left. Maybe Michelle can just comment on your capital position. I know there’s a lot of other pipeline, but unfortunately we’ll, we’ll save that for other questions for another time.
Michelle Robertson
Sure. So, we ended Q2 with just over $500 million in our cash runway. That’ll take us into 2024 with our current programs, and we’ll continue to assess financing opportunities, both dilutive and non-dilutive the rest of the year.
End of Q&A
Matthew Harrison
Great. Great. Well, thank you very much for being here. Appreciate the time.
Gilmore O’Neill
Thank you very much.
Mark Shearman
Thank you.
Baisong Mei
Thank You.
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