All right, great. Welcome, everyone. I'm Yigal Nochomovitz, one of the biotech analysts here at Citi. This is the second day of our virtual Oncology Leadership Summit. It's my pleasure to introduce the CEO of CRISPR Therapeutics, Samarth Kulkarni. Sam, welcome. Thank you so much for taking a few minutes to chat in your, of course, very busy schedule.
Thank you very much.
Obviously, you just reported the quarter, last night, so it's a great timing. Maybe just if you could just hit maybe a few highlights from the release last night, and while you're doing that, just give a quick overview, of the company's pipeline and strategy. Obviously, most people are very familiar, but it would help just to set the scene a little bit. Thanks.
Yeah, happy to do that. You know, I think at a very high- level, I think we're exploiting what's fundamentally one of the biggest advancements in biomedical research in the CRISPR-Cas9 technology. This is the biggest breakthrough we've seen in the last 40 to 45 years. The strategy for the company, I mean, you know, I think we have grand visions of what we can make with, you know, with this technology and how we can impact medicine. We'd like to be, you know, a $100 billion company in the next five to seven years, on the back of medicines that can truly transform the lives of patients with serious diseases. We have four platforms. One is sick...
You know, hemoglobinopathies, and we'll talk about sickle cell disease and beta thalassemia, where we're on the cusp of getting to market, hopefully in the next period of time, the not- too- distant future. That can be a very impactful medicine for these patients. We have our immuno-oncology platform, which we'll talk about a lot today. Again, there we're making good advances. We also now have a Regenerative platform where we are going after Type 1 diabetes, and this is with pluripotent stem cells that are differentiated into islet cells to create organs off the shelf. Finally, I think we announced in our earnings yesterday that we will be entering the clinic this year with our in vivo program targeted towards ANGPTL3, a key marker in cardiovascular risk reduction.
We're, you know, moving forward across a number of platforms or pillars, as we call it, which diversifies us from a risk standpoint, but at the same time expands the aperture in terms of the opportunity for treating not just a few, but tens of diseases over the next several years. That's as a very high-level overview.
All right. Perfect. Well, let's start with exa-cel for beta thal and sickle cell. The EU filing is in, and the BLA you've indicated will be finished by the end of the quarter. Just give us a quick update in terms of what's left to do on the BLA, and what are your expectations for the timelines for approval as well as, you know, your vision of what the label would look like, hopefully.
I think you know, everything is on course with the BLA filing. I think we, you know, we're proud to have completed the European submissions and, you know, submissions were validated by both the EMA and the MHRA recently, which we disclosed with our partners, our partner, Vertex, and us disclosed. On the BLA, I think, you know, we're marching forward. You know, as you know, with these BLAs that have for medicines complexes, the one we're developing, it's gonna be a pretty extensive file, and there's a lot of work being done to complete the filing. I wouldn't point to anything in particular that's outstanding. I think it's just routine course what we need to finish and complete to get to a complete BLA filing.
We hope to do that through the course of this quarter. I mean, not that much time left in this quarter. I think at the same time, I think we're, you know, we continue to think about how the franchise can expand. You know, in our earnings release yesterday, we talked about a conditioning agent, a gentler conditioning agent that can, you know, expand the population that's treatable with exa-cel tremendously. All in all, we're very committed to sickle cell and thalassemia. We're in pole position as the leading gene-edited or gene-modified therapy that's gonna get to patients, since with sickle cell disease, obviously, there's other players in the, in the space as well. For gene-edited product, we'd be the first, and we have a significant lead over other players.
I think, you know, this product can be very transformative, for patients, but also transformative for the company, from a runway standpoint and sustainability standpoint.
Okay, we'll talk about the conditioning agent in a moment, but just in terms of, where your partner is with regard to the commercial efforts, can you just give a quick update there with regard to, manufacturing, availability of the product and also in terms of what you've learned from your competitors with the launch of Zynteglo. You know, how do you see that aspect in terms of, preparing yourself most effectively, for commercial?
Yeah, I think, you know, we're pleased to have Vertex as a partner leading the commercialization efforts. They have tremendous experience with rare diseases, given what they've done with cystic fibrosis. They have a global presence. They have capabilities, spanning all commercial functions. This is a top priority for them. I think, the preparations for launch or commercial preparations are going really well. I think, the key part of the success here is to make sure that the centers that are gonna do the transplants are well qualified, they're well-trained and ready to accept patients and provide them our medicine. That's no easy task, but I think that's something we're on top of in terms of establishing teams that are dedicated to these centers, both in the U.S. and Europe.
There's very encouraging discussions across the board with payers. You know, I do think there's support from the politically, there's a lot of support around providing a medicine for sickle cell disease. I think, you know, all in all these things need to come together to successfully launch what would be the first, potentially be the first approved CRISPR therapy in the world. I think, so far, we're very encouraged by all the developments. In terms of Bluebird and the Zynteglo launch, you know, I think it's, you know, there are some learnings there, but I wouldn't superimpose too much. I think it's a different situation, a different type of product. You know, although it's a cell-based product, I think it's using different technology.
You know, it doesn't have all the tailwinds that a CRISPR-based therapy would have from a visibility standpoint, and from the standpoint of the data, it's very strong. I mean, our data we presented at EHA and ASH are remarkable for these patients. We feel very good about how everything's coming together. Vertex will talk more about what they're doing on the commercial front in the coming months. Needless to say, I think this is a top priority for both companies.
In terms of the commercial strategy in the United States versus Europe, are those fairly similar, or are there some notable differences? When you think about the launch, you know, people are wondering in terms of whether it's more of a bolus effect or you think it'll be more of a measured launch initially.
I think the, you know, obviously there are some nuances that are very different about U.S. and EU markets, particularly from a payer standpoint. Ultimately from us, from having qualified centers to treat the patients and how we bring the patients in, how we schedule the manufacturing, how we supply, all that's very similar. I think we have a redundant manufacturing network with manufacturing capacity both in the U.S. and Europe that would be able to meet all the needs and demands of the patients as they come into the program. I, you know, we're not, you know, while we haven't scaled to thousands of patients yet on manufacturing, we're at a sufficient scale just to meet all the demand as we anticipate it.
In terms of, you know, how we bring this all together at the center, again, I think it depends on, you know, how we train the centers, how we support all the patients that come into the program, et cetera. All that's in a good place.
Okay. Let's talk about the kit ADC. Obviously, that's very interesting in terms of expanding the addressable population and moving away from the busulfan . Can you just expand on that and why that's so important to the strategy?
Yeah. You asked the question about the bolus. You know, it's hard to say, but I think what I would say generally is the demand for this therapy is likely to be far greater than a lot of people anticipate right now. I think, personally, having been involved in discussions at various forums in D.C. and other, you know, organizations that support patients suffering from these diseases, these patients are tired of living with sickle cell, and they wanna have some option that would restore normalcy to their lives. It's hard to differentiate whether it's a bolus demand or if it's just a start of something that could be a lot larger, but I do think the demand equation is gonna be pretty strong.
Now, you look at 25,000 patients or so with severe sickle cell in the U.S., you know, it's hard to say which patients come forward first. I think those that obviously have a lot of VOCs every year, those that live with a lot of chronic pain, those are the ones likely to raise their hands first and opt for a therapy like this. If you have a gentler conditioning agent, I think you're talking about an addressable population that's triple the size. More importantly, the launch trajectory, it becomes a lot steeper because you'll see more patients come through early on. You know, again, our conditioning agent is in early stages, so it's not like it's we're gonna have that approved tomorrow.
Both Vertex and us are putting a lot of effort into developing a gentler conditioning agent, which may come into play three, four years after initial launch. That'll provide real tailwinds around the addressable market, but also how quickly the trajectory changes upward.
How would that work in terms of an... You would need to seek a separate approval for the ADC, presumably? Or just how does that work from a regulatory perspective?
I think, I think again, it's early days right now. I think, you know, you would need a separate approval. I think there are indications where you can get approval very quickly for an ADC that's conditioning-based. You know, take example of rare SCID as indications, for instance, where if you can show that you can use a conditioning agent and do an allotransplant successfully and get sufficient chimerism. You could get approval for a conditioning agent at the same time while you're establishing that agent in the context of sickle cell and thalassemia. You'd have to have a two-pronged approach to, one, get the agent approved, but then also show that it has benefit in the indication with exa-cel. All those...
We can talk more about that once we get to an IND or get into the clinic, but there are strategies to fast-track a conditioning agent.
I don't know if you can comment on pricing at all at this point. If not, that's fine. If you can provide any general comments relative to the competition from Zynteglo, that would be great.
Yeah, I mean, it's too early to say, I think, you know, but what we're seeing from the agencies that, you know, have a say in pricing, for instance, ICER or other bodies, you know, all the analysis is coming out pretty favorable in terms of the ability to price in a certain range. The Zynteglo price will have an anchoring effect to a certain degree. You know, overall, we live in a regime where I think the pharmacoeconomic benefits alone, not to mention the value to the patient overall, justify a reasonably high price. Again, it's a price, even at that price that Zynteglo has, the benefits to the system far outweigh what any payer would pay for that drug. More to come on pricing.
Again, Vertex will lead the charge in disclosing the pricing strategy and will come out on launch. Again, I think what I'm encouraged by is the support from various payer bodies around such a pricing model.
Then with regard to the labels for Europe and the U.S., I mean, I assume that they're basically gonna be similar or if not identical. Are there any notable differences that we should be aware of in terms of the way the labels will be structured in the two regions?
We don't think there should be any difference in the label. I think that we have to just go through the process with each agency and see if there's any, you know, any small differences that may be there between how they interpret the data. By and large, the, you know, our trials were global trials that enrolled patients across both the U.S. and Europe, and beyond. I think, the data, you know, are kinda the same for all these patients, so we don't anticipate major differences.
Okay. Well, unless you wanna make any other comments on exa-cel, let me know. Otherwise, we can move on and talk about the IO and CAR T franchise.
No, I think the only comment I'll make, [Dallas], which is, you know, we've created a franchise, I think, you know, from a business standpoint as well. We've navigated this really well in terms of, you know, what you need to spend to launch it. Ultimately, I think, how do you create a profitable franchise that can then help us, you know, expand our portfolio efforts even beyond hemoglobinopathies? A situation where I think, you know, there are a number of competitors who wanna go after sickle cell with cell therapies, and I think it's gonna be very hard for them to catch up to us. That's because we've moved very fast between Vertex and us, you know, in a responsible fashion, but moved much faster than other companies have been able to move.
I think we look forward to additional updates on the program, but we feel good about the pole position we're in.
Do you wanna just briefly touch on the, I believe, somewhat a slight restructuring of the agreement with Vertex that was favorable to you, I believe, for the long- term?
Yeah, no, it wasn't a restructuring per se, but when we, you know, I think the key decision we made along the, along the journey of the program, you know, it started as a 50/50 program, but I think it made sense for one party to take the lead commercially, globally, given it's one similar product and it's a similar launch. We converted that arrangement to a 60/40 arrangement with Vertex-
Yeah
... last year. That came as a significant upfront payment to the company. But also, I think there are some advantages in terms of how the costs are recognized and some costs that we're able to defer until later, for when we're profitable. You know, that restructuring I think was very helpful for us, in managing our own burn rate, and our own sort of, sustainability as a company.
Okay, perfect. All right, let's talk about, start with the CTX110. I believe there's gonna be another update later this year. Can you talk about that? As far as the filing strategy for that asset, where do you stand?
Yeah, I think, you know, we feel very good about competing in the CD19 franchise. I think the conventional wisdom out there right now is CD19 is too crowded, and it kind of reminds me of the Yogi Berra saying, you know, "That restaurant's too crowded, no one goes there anymore." You know, it's a market where there's significant unmet need. I mean, you know, there's even with where Yescarta is with the autologous CAR Ts, there are a lot of, you know, patients who don't get autologous CAR T for various reasons. Bispecifics data have been good, but I think they're still gonna face some challenges in moving to a community setting.
Particularly as you think about nine or 10 courses of treatment, and the infections that go with it, the CRS and ICANS that potentially you could still have. Allogeneic CAR T has been shown to be very safe, you know, a single course of treatment, either one or two doses. I think, you know, you could have major debulking of the tumor and get CRs, durable CRs at that, from a single dose. What we showed with, you know, CTX110 was the, you know, was data that shows that about one in five patients get to a durable six-month CR. You know, 19%-20% six-month CR rate. Now we have a follow-up where these patients have gone close to two years with a single dose of CTX110.
These are patients that had, you know, didn't respond to four or five lines of therapy, and it's absolutely remarkable. What we're now doing is a consolidation dose, a second dose, which in all likelihood is gonna make the data even better. You know, if we end up at, say, one in four patients that have six-month durable CRs or long-term durable CRs, that's getting very close to autologous, which in the real world is somewhere in the 30% range of durable CRs, from an intent- to- treat population standpoint. You know, the benefits, I don't have to talk about the benefits of an off-the-shelf and, you know, the fact that you can do this in community settings, you can do this without having all the costs of CRS and ICANS, gives us tremendous benefits.
I think CTX110, in its current form, with the consolidation dose, can be a competitive product. I wouldn't be surprised if it could be, you know, the data hold out that it could be a billion-dollar product, in the not-so-distant future. You know, what we're doing is we've obviously started our pivotal trial. You know, we've designed an interim analysis or interim checkpoint on the trial. It's hard to say based on enrollment speed, et cetera, that, you know, interim analysis point could be at different points. It's really gated by enrollment speed and what the data look like. We'll provide an update.
The strategy is to file off a single-arm study, you know, it'll have to be followed up with randomized controlled trials, et cetera. But at least you can get to market with a single-arm study, given the data as we see it today. That's our plan with CTX110. We do have a next- gen version of our CAR T called CTX112, that where the IND is approved, and we're gonna start dosing patients in short order. That program, you know, I think can be even more potent. You know, we believe that program can be better than auto CAR Ts in terms of efficacy, in terms of durable CRs.
We have to do the work in those patients and see where the data come out and make sure that it continues to remain safe. We feel very good about that program as well in the CD19 space.
What, just, can you kinda go through the differences with 112 versus 110, and why you believe that one has a higher potential?
Yeah. You know, in this world of AI and machine learning and everybody talking about how that's gonna change the face of biotech, we did a, you know, very simple set of experiments with, you know, a robust fashion, which is to take, you know, thousands of different edits without any bias and do pairwise edits to see what's gonna increase the potency of our CAR Ts. We came upon this particular pair of edits. One of them is TGF-beta R2, which is a well-known sort of marker in cancer, and the other one is Regnase-1. Regnase-1 is a novel edit. It's an RNA- binding protein that is a transcriptional regulator of cytokines, and it generally restricts a pro-inflammatory environment with the CAR Ts. If you knock out Regnase, you get a more inflammatory environment.
It's, you know, it's a combo of various strategies like a cytokine backpack, or other edits that release the, you know, make it a more pro-inflammatory environment like OX40, et cetera. That combination of edits in preclinical testing, is at least tenfold better, if not more, from, in mouse models of tumors. Not just the first one, but upon re-challenge as well. In our manufacturing process, I think the expansion of these cells is a lot greater. We've also seen with flow experiment that they retain a greater proportion of central memory phenotype CAR Ts. Now, you know, when we start dosing patients, we'll know very quickly what the PK/PD profile looks like for CTX112 and CTX131.
If the expansion at dose level one, let's say, is tenfold higher for these CAR Ts, we know they're gonna be more potent and they're gonna work better. In the next six to eight months, whether we disclose the data or not, you know, we'll have an indication of how these CAR T are performing.
Okay. Just the CTX131, just so everyone's clear, is the CD70 CAR T that also has these two edits that you've referenced, correct?
Absolutely, yeah. There it's even more important. The potency is really more important. What we saw is the first evidence of a complete response in a solid tumor setting with our COBALT-RCC trial. You know, with 1 dose of an allogeneic CAR T CTX130. What we saw was a complete response in our RCC patient that had failed multiple lines of therapy. That gives us a lot of confidence that the target is working. Not only that, we saw a number of patients that had stable disease that went on for a long time. There was disease control in these patients. We saw a competitor present data as well, and they had PRs or partial responses with the same target in RCC, which all leads us to believe that CD70 is a very good target in RCC.
We need to turbocharge the cells because in a solid tumor setting, the tumor microenvironment secretes various factors that dampen the response of the CAR Ts and also exhaust these CAR Ts. If you can add some gasoline to the fire on the CAR Ts, I think you're gonna see a lot more encouraging data. You know, something like CTX131 in RCC, in third-line RCC, if that starts working, that's gonna completely change the trajectory of our company.
You referenced the efficacy boost, I think, around 10x to go when moving from CTX110 to CTX112 with these novel edits. Is it a similar situation on the RCC side of the equation with the CTX130 versus the original one?
Absolutely. The same effect. In fact, the expansion effects are even better in the RCC context, as you see more antigen in those solid tumors in a localized fashion. I think, you know, the, our investigators and all the doctors have figured out how to manage the safety profile of these CAR Ts, even if they're more potent.
In terms of managing the strategy for these next- generation constructs, I mean, obviously for 110 you're very far along the road, I'm assuming that you're going to launch that product, but, and then follow with 112 eventually. For RCC, is it different where 131 might just eclipse the older one, the 120, and then you take the 131 forward and not the 120? Is that a fair way to characterize it?
Yeah. I think. Yeah, 130. I think what we've done is, you know, we had 1, 130, CTX130, we had a trial in T-cell lymphomas and in RCC. What was intriguing is we saw responses across both, but what was intriguing is in T-cell lymphomas, where the cancer is spread out, it's in the skin, et cetera, you know, I think what we saw was the CAR Ts were doing their work, and they weren't easily getting exhausted. Part of that has to do with the CD70 knockout in that construct. In the solid tumor setting, what we saw was while the CAR Ts were around for a month, you know, they were getting exhausted around day 12, day 13, day 14, as we measured it.
What we've decided is we're gonna continue developing CTX130 in T-cell lymphomas. By the way, that product in itself could be a billion-dollar product, and shift over to CTX131 in RCC. The T-cell lymphoma, the comment I made is, you know, it reminds me a lot of what happened with Seagen in the early days with CD30. You know, everyone thought this was gonna be a tiny product, you know, didn't know what the prospects were, and more and more patients started emerging, coming out of the woodwork as the therapy is available. Now it's a relatively attractive commercial product. CD70 in T-cell lymphomas could be something akin to that, given there is over 3,000 patients that suffer from T-cell lymphomas in the U.S. alone per year.
Yeah. Just going back quickly, just going back to 110, with respect to the consolidation dosing, is that when are we gonna actually get that data? I think you sort of referenced the one in four durable CRs would be the bogey or the goal. Can you Is that something that you expect to get in the initial label for the product, or would that come later?
Well, I think, you know, I call it a bogey or anything like that, but what I said is, you know, we do think that the current data, which is a 20% six-month CR rate, we do think the product is approvable, based on the discussions we've had and it's a competitive profile based on the market research we've done. Anything that's better than that makes it even more competitive. You know, if, for instance, we move from 20% to, you know, something higher, let say 25% on the six-month CR rate, we're dramatically increasing the competitiveness of that program. That's, that's the data we're watching. We don't have the data in hand because for durability, you do need to follow the patients for a longer period of time.
What we're encouraged by, and we said that at ASH last year, was the second dose with the second consolidation dose, we do see conversions of PRs to CRs, right? If you, if you're converting a partial response into a CR, you're just increasing the number of patients that are in response and that have the potential to have a durable CR. So that I do think, you know, it does give you a bit of an efficacy boost, and the safety profile remains the same.
Okay. Very good. You wanna move on and talk a little bit about the Regenerative Medicine franchise? So you have several programs there for diabetes, 210, 211, and 212. Just for the purposes of reminding everyone of the differences, if you could just clarify how they're different. And what the plan is to share the updates. I think you're gonna share the updates for the 210 soon, that's completed dosing.
Yeah. I think overall, I think we're gonna be talking about organs off the shelf quite a bit in the next few years. You know, I bet if we're sitting here five years from now, doing this fireside chat, Yigal, we'll be talking about not just diabetes, but several indications where you can use organs off the shelf. I was looking at the data for kidney donors the other day, and there's like 95,000 patients waiting for a kidney donor, and it takes years to get one. You know, why are we not moving forward with artificial or organs off the shelf in a more meaningful way? I think this is the first step in that direction.
You know, we're taking pluripotent stem cells and directing their fate to generate islet cells or islet cell precursors. We're implanting that into the patient. Now, this concept works because the Edmonton protocol, which was developed 22 years ago now, has patients that have had meaningful diabetes control over years with implantation of cadaveric islet cells. The only downside is you have to put these patients on heavy immunosuppression, the cells don't get rejected. Now, with CRISPR, you can make these cells stealth, you don't need the heavy immunosuppression to make these cells stealth. That's something that's gonna be, you know, really important concept, the use of CRISPR to make these organs stealth, you can mass produce organs off the shelf. We started with diabetes, where we have, you know, VCTX.
This is in partnership with ViaCyte. VCTX210, 211, and two, you know, versions beyond. The notion was, let's iterate very quickly, given we're working with a pluripotent stem cell, and we can make edits consecutively to show the value. VCTX210 was designed, primarily as a safety run-in. This has edits to, the beta-2-microglobulin, for instance. We make edits to incorporate HLA-E, and insert PD-L1. You know, we wanted to make sure that there is, that this therapy is safe in terms of implanting into patients.
In partnership with the regulatory authorities, we designed the study in a way where we use a relatively low dose of these cells and did a run-in, safety run-in with patients to make sure the procedure is safe and that you can actually put edited cells inside the body and not have any adverse consequences. That data, you know, I think that trial or that safety run-in is complete, which leads us to VCTX211, which is a more optimized dose and an optimized clone with additional edits as well that increase the cell fitness. These are two additional edits, non-obvious edits, by the way. A20 and MANF are the genes which came out of large empirical screens to improve the cell fitness for this next clone.
That trial is dosing as we speak, and we announced that yesterday in our quarterly release, or 10-K. We said that we've begun dosing patients with VCTX211, and we should have that data this year. I think we're gonna discuss with Vertex, who acquired ViaCyte, as to the right paradigm for data disclosure, but we're very bullish on that program. Then two twelve refers to anything that's beyond two eleven. We continue to experiment with different edits, whether it's to control fibrosis within these cells, to prevent immune rejection of other forms, whether it's NK cells or anything else. We continue to add edits and that just shows you the power of editing in a pluripotent stem cell.
We can, you know, progressively make these cells more sophisticated and better as we bring them to patients.
Okay. For 210, what should be the expectation from investors with respect to the type of information that you'll share there? I mean, I think the focus is obviously on safety, but everyone will, of course, be interested in some of the potential signals of efficacy in terms of glucose control and things of that nature, insulin dependence. Is that something that we should expect or no?
Well, it wasn't designed for glucose control, insulin independence. You know, the number of cells we put in. You know, I think you wanna get at least half of 0.5 nanogram per or picomoles per milliliter of C-peptide production. C-peptide is the best marker for insulin production because these patients are all taking insulin, right? How do you differentiate insulin that's produced by these cells from the insulin they're injecting themselves? That's by measuring C-peptide. The insulin that's produced by these cells is in the form of proinsulin that gets cleaved to produce insulin, and a byproduct is , and you measured that.
Yeah.
I think what, you know, what we're watching for in VCTX210 was, you know, one, the safety of the procedure, the safety of the cells, but also to see if the cells are getting rejected right away. You know, in the case of immuno-oncology, for instance, we put our CAR-Ts in, you know, within about one month, they're rejected, right? Or they're eliminated by the patient's own immune system. We wanna make sure that's not happening. That's all around safety and immune evasion, which gave us confidence to move into VCTX211.
211 is designed such that, the clone is optimized, but also the number of cells are optimized to produce a level of insulin that's meaningful from a glucose control, perspective in these patients.
Tell us a little bit more about the way they're delivered. It's these cells are in a matrix. I'm not sure if using saying device is the right word, but it's in a matrix. Is the idea that this would be a one- and- done, or would there be some requirement for, you know, quote-unquote, recharging of the cells over time? Those are questions which I guess maybe we don't know yet.
Yeah. I mean, ultimately, we wanna get to a one- and-d one. Even if you get to a profile where, you know, you can recharge every two years, that's an acceptable profile from a market competitive standpoint. These are very simple sub-two devices or, you know, It's a device that's, you know, can harbor the cells inside them. It's a relatively flat, you know, device that's half the size of a credit card. They can just be removed and a new one inserted in the same space, under the skin. It's relatively easy to do. Even if you get a two to three-year life on these devices with cells, that's a pretty attractive profile.
The 211 which you just announced during the clinic, that's, if I'm correct, that's in Canada. Are you thinking about a U.S. study there as well, or not necessarily right now?
Yeah. I mean, ultimately, we wanna do that in the U.S. as well. I think, Canada has become a center of excellence around these cell therapies and diabetes because, you know, the Edmonton protocol was discovered there or elucidated there, in the early days. There are a number of investigators that are quite, you know, the experts in the field, and that's why Canada makes sense to start. Then we'll bring it to the U.S. as well.
I mean, then to the concept of walk before you can run, I mean, this is Type 1. We wanna prove everything. Do you have visions of broader to go into Type 2 or what are you thinking about?
Absolutely. I mean, if it works in Type 1, there's no reason it shouldn't work in Type 2. I think that'd be very interesting in Type 2. Obviously, you start with the very severe patients, versus the patients that are, you know, moderate diabetes. But eventually, as you get longer and longer life from these devices, you know, you could imagine artificial pancreas for Type 2 diabetes. Once we get to that point, by the way, it's even more scalable because if you figured out how to make these cells in a stealth fashion and remain in the body, you can express other factors in these cells. You know, take an example. You could express GLP-1 in these cells in patients under endogenous regulation.
You know, right now, all the GLP-1 drugs are there's a lot of excitement about it, but, you know, these patients still have a lot of nausea, and it's not an easy drug to take forever. If you're doing under endogenous regulation that's controlled, that's based on glucose levels, that's a very attractive profile.
Yeah. Let's talk about in vivo, where you've just announced that you're about to start a phase I for the ANGPTL3. Tell us a little bit more about that target. You're going into a new vertical in cardiovascular disease. I think this was initially announced, if I recall, back in last summer at the Innovation Day. Talk about that and what is the design of this study.
Yeah. We're in the clinic this year with ANGPTL3, which is our first target in cardiovascular disease. The whole notion is, what are some of the key markers of cardiovascular risk reduction? ANGPTL3, LPA, and PCSK9 are the three most or most notorious ones, I would say, in terms of being proven markers of cardiovascular risk reduction. We decided to go with the ANGPTL3 first. This is a target which directly impacts the lipoprotein lipase. You know, you generally see with ANGPTL3 knocked down, close to 60% reduction in triglycerides and anywhere from 40%-50% reduction in LDL. There is a antibody that's approved that targets ANGPTL3 from Regeneron.
You know, the reason we're going for ANGPTL3 first is it's a more straightforward development path. There are patient populations that have very high triglycerides that can be good candidates for treatment. You get both the triglyceride reduction and the LDL reduction. There are surrogate markers like pancreatitis, which can be measured in these patients to know whether the drug is working or not. I think with smaller population or smaller trials, we could get on label with this target. LPA is a very interesting target that a number of pharma companies are going after as well and siRNA companies. I do think it's gonna be a major target in cardiovascular medicine. We'll have data coming out this year and next year around some of the siRNA trials.
I do think a one and done approach, though, compared to siRNA, is still much more favorable. Not just from a convenience standpoint, but from a disease prevention standpoint, because you don't have the ups and downs of LDL levels as you go from 1 dose to the next. You have a continuous and consistent reduction in these cardiovascular risk factors.
In terms of the delivery, can you talk about that for in vivo? What strategy are you adopting for the ANGPTL3 for delivery?
Yeah. Yeah. We're using a lipid nanoparticle, LNP strategy that's now with the, you know, over the last three years with the COVID vaccines and all the work that's been done on lipid nanoparticles, largely been de-risked. For delivery to the liver. We're using a lipid nanoparticle that we have access to for delivery to the liver, and we show that this LNP in NHPs can give you significantly higher editing rates in the 60%-80% range of hepatocytes. That shows that it's working well. That's the delivery vehicle for liver targeting.
Are you gonna use AAV for anything else or?
We are using AAV with our neuromuscular programs. Now recall that we have, you know, a partnership with Capsida, where we're working on ALS and Friedreich's ataxia, where we have capsids that are optimized for neural delivery. We have a partnership with Vertex on DMD and DM1. Those programs in DMD and DM1, we have been making good progress, where we have capsids that are tropic to the muscle. I think for liver targeting, where it's LNP is the best approach right now. I think for other organ systems, we're attempting both viral and non-viral.
Okay. Just going back to the ANGPTL3 for a moment. For that study, you mentioned the Regeneron antibody. Are you specifying that those patients that are enrolled need to have tried and not succeeded with that antibody or not necessarily?
Not necessarily. I don't think we need to go out for a piece of failures. I mean, a lot of patients that don't take it, don't have the antibody or the benefit of the antibody right now, and control disease. I don't think you would need to show that given it's, you know, it's still early stages in that disease indication as opposed to something like a PCSK9, where there's gonna be approved agents that are around for a while.
If you achieve early success with the phase I for ANGPTL3, obviously you're gonna be thinking about the bigger picture and the large development. As you know, those are potentially very costly programs to do large phase III studies in cardiovascular. How are you thinking about that aspect in terms of managing the spend for what could be obviously substantial cost on that front?
I think, you know, either ANGPTL3 and LPA, I don't think they're gonna be very expensive trials. You know, LPA may be slightly more expensive than ANGPTL3. Outcomes trials do take a while, and we have to support those. You know, we can easily partner with pharma. I think there's a lot of interest from pharma right now around these targets. There's a major resurgence and interest in cardiovascular and diabetes among pharma companies, so we're well-positioned around that. We could always partner in terms of doing the trials, but we wouldn't do an Ionis type model where we give up the upside. You know, I think we do wanna, you know, we do wanna take some of the risk ourselves and support, you know, support that development.
One, to, you know, participate in the upside, the other, to make sure we have control on these assets and we can develop them, you know, in the appropriate way, with a nimble and flexible approach. I do think. We have the ability to finance. We have a very strong balance sheet, you know, close to $2 billion. Our hemoglobinopathies franchises, you know, in a way, are already kind of profitable for us because we have a large milestone payment that covers any remaining expenses we have. That's gonna be a profitable franchise. I think our IO franchise will be a profitable franchise in the next four to five years.
I think, you know, that's our goal, is to have a new franchise, you know, towards a path where we get to on file and get to profitability. Then expand into new franchises. I'm confident that we can find a way to finance these medicines, and actually continue to move aggressively when a lot of other people are slowing down right now.
I wanted to give you a chance just to comment on the IP. I mean, when I first started covering you guys a long time ago, obviously there was a lot more controversy on that front, which seems to have pretty much waned. Is there anything left on that, on that aspect to be concerned about? Or just how are you feeling now about your IP positioning relative to some of the other competitors in the CRISPR space?
Well, Yeah, I think, you know, several million dollars spent later from all the different parties involved in the IP battle. I think what's clear is there's no clear winner. You know, I think there's gonna be IP that we have, that's gonna be important and foundational. There's claims to other IP from other parties that, you know, is still standing. Eventually, I don't think any of this is gonna get in the way of medicines being commercialized. There will be a way to settle this. You know, in many ways, I think the academic institutions are not as fast-moving with selling these types of disputes and matters, but I'm sure the companies will find a way eventually. I don't think that's gonna be a major issue.
I do think that, you know, people don't do kind of forget that all this foundational IP is necessary for all the next gen gene editing that's out there. You know, whether you're doing RT-based editing, reverse transcriptase-based editing or base editing or whatever else, you're gonna need foundational access to CRISPR-Cas9. There is significant value to this estate, even beyond what's visible right now in the pipeline. By the way, it gives us a big trading chip as we access new technologies. A lot of my effort right now is on our group called CRISPR X, where we are doing all forms of next- gen editing, well beyond base editing, for instance. You know, I think we're gonna...
You know, there's indications ex vivo and certain in vivo indications where CRISPR-Cas9 in its classical form is gonna be most effective, and we're gonna pursue that. There are gonna be some indications of, for short corrections or long gene insertions where we're going to the next-gen editing systems. We have some of our own proprietary systems, and that's all gonna come into play, and that's all gonna need IP that we have, which is the foundational IP.
You wanna talk a little bit about manufacturing and how you're thinking about investing on that front? That's something which would be obviously important as you expand the pipeline and you bring more products to the market.
Absolutely. I think we've established our internal manufacturing system. You know, I think, contrary to a lot of typical moves that biotech companies make, we didn't pick Puerto Rico or, you know, some other far off place to do our manufacturing. It's literally right here in our backyard in Framingham, Massachusetts. We have a manufacturing facility that can do cell therapies, can manufacture. In short order, we'll be able to manufacture mRNAs, lipid nanoparticles, et cetera, the whole spectrum. You know, obviously, you asked about our CapEx trends and everything else. Those were all one-time spend items that we did during the pandemic in the 2021, 2022 timeframe, and we're past that now.
I think gives us tremendous leverage from an efficiency standpoint, but also tremendous flexibility from a speed standpoint as we move forward. So we're eventually gonna have a full service, you know, manufacturing setup that can do cell therapies, mRNA, LNPs, and potentially AAVs as well.
Sam, you mentioned obviously a very strong balance sheet, I believe close to $2 billion. How much dry powder do you have in terms of continuing to expand the footprint, expand the portfolio, bring new assets into the clinic, to maximize your leverage on development?
Absolutely. I think we're pedal to the metal right now, but in a responsible fashion. You know, if you look at our... We've tried to keep everything very efficient as well. If you look at what we're doing, you know, we're doing all of what Bluebird's doing in sickle cell and thalassemia. We're doing all of what a company like Allogene Therapeutics were doing in IO. We're doing all of what some of the in vivo companies are doing and doing Regen Med, all with the burn rate that's not dramatic. You know, I think less than, you know, half a billion dollars a year. Plus we have a number of milestones that are coming in the future that are gonna reduce our net burn going forward. In fact, this current interest rate environment helps us a lot on that as well.
You know, we don't have a dilution risk, and we have dry powder to do business development deals if we see assets that can be attractive and adjacent to our core strategy. We're, you know, as busier than ever at CRISPR right now, and we continue to move nimbly, and we wanna move smarter than others so that we can further expand our lead in the space and carve out our preeminence.
All right. Perfect. Unless you wanna add anything else to close out, this was great. Thank you so much. I really appreciate the time.
Thank you, Igor. Appreciate it.
Welcome.