Great! I think we're ready to go. Our last company session, welcome everyone. I'm Josh Schimmer from the Cantor Fitzgerald Biotech Equity Research Team. Very pleased to introduce from Design Therapeutics, we have Pratik Shah, Chief Executive Officer. Design doing some really interesting work in protein translation efforts in genetic diseases. Pratik, maybe give us a quick snapshot of Design Therapeutics, as well as some of the milestones we have to look forward to.
Yeah. Thank you. Great to be here. Design is focused on a new class of small molecules, that have this very unique profile, which is the ability to dial up or dial down the expression of an individual gene in the genome with a small molecule. And we're focusing our therapeutic efforts on monogenic diseases, where we know exactly what the single gene driver of pathology is. And there's an opportunity to develop either first-in-class or best-in-class molecules that go after this root cause with a small molecule, which would be intended to restore the desired natural state of transcription in a cell, despite the presence of repeat, without any genome editing, without any, you know, gene therapy type approaches. And, small molecules have just an inherent advantage of distributing widely, being, more sort of amenable to pharmaceutical type products.
We're working in four major areas: Friedreich's ataxia, Fuchs' corneal dystrophy, Huntington's disease, and myotonic dystrophy. Each of these are very large opportunity areas, and success in any one of these areas could drive tremendous value for patients and shareholders. And we have a cash runway that supports the generation of a clinical proof of concept on at least one, if not more, of these four important areas.
Maybe give us a very quick snapshot of what the GeneTAC platform is, 'cause I think ultimately the best way to understand it is gonna be kind of walking through the Friedreich's ataxia program. But maybe before we do that, as I said, like a snapshot of what GeneTAC is.
Yeah. So GeneTAC is short for Gene-Targeted Chimeras, and that acronym is meant to refer to these small molecules that are non-oligonucleotide compounds, that are designed as heterobifunctional small molecules. One end of the compound is designed to recognize specific DNA sequences, much like a transcription factor would. And then, that moiety is linked to a ligand that would attract or interact with the necessary transcriptional protein or machinery, in order to drive a restorative state to either dial up or down transcription.
All right. Let's put this into practice with the Friedreich's ataxia programs, and starting with what, what is the genetic defect?
Friedreich's ataxia is a really debilitating condition that is driven by a single mutation in a single gene, and that gene is called frataxin. Patients get a mutation in which the cells are not able to make normal levels of frataxin, and that occurs because the gene mutation is a GAA nucleotide repeat that is expanded quite dramatically in Friedreich's ataxia. While a normal individual would have less than 30-34 GAA repeats in their frataxin gene, somebody with FA could have, you know, 400 or over 1,000 such GAA repeats. What those repeats do is essentially slow down the transcriptional process, such that the level of mRNA is low and the level of protein is low, and that's what drives the condition.
Got it. So we have missing protein, it's a mitochondrial protein. How does that lead to pathology, and what are the symptoms?
Yeah. So Friedreich's ataxia is often diagnosed in teens, and it's you know highly debilitating. Patients get... It's a systemically expressed protein. It's expressed at low levels, so it's not entirely missing. And the low level of expression causes malfunction in a number of different organs. So there's hypertrophic cardiomyopathy, which is actually the primary cause of mortality in these patients. There's a progressive deterioration of the patient condition. There's ataxia and other neurological consequences. There's also metabolic dysfunction in these patients. Surprisingly, one in a hundred people are carriers of the FA mutation, and so it's when two carriers have a child that the child ends up with a one in four chance of getting the mutant allele from each parent, and it's when you get the biallelic mutation that the protein levels are low.
Carriers have about half normal frataxin, and carriers are asymptomatic, so we know that getting down to about half the normal level is still okay, but it's when you get two bad copies, you drop to maybe 20-25% of normal levels of frataxin, and that's what drives the pathology.
All right. So maybe we can talk a little bit about the process of mRNA transcription and what's happening with the GAA repeats that's breaking down that whole process?
Yeah, so the remarkable thing about the GeneTAC molecules is that they're able to restore normal levels of frataxin RNA expression from this cell type, even though the gene has this mutation, which is a really striking phenomena. So, in order to understand what drives the mechanism of low levels of frataxin expression, we start with these GAA repeat expansions. Think of the GAA repeats as speed bumps. So if in a normal gene you have, you know, less than thirty, the polymerase can get through that gene normally. But it's when there are, you know, hundreds of speed bumps all next to one another, like is the case with these GAA expansions that are sitting in intron one of the frataxin gene, that it slows down the efficiency of transcription through that region.
The GAA repeat presence lowers the level of active transcription through the gene. Active transcription regions in the genome, in chromatin, have these characteristic hallmarks in the chromatin. This DNA that's being actively transcribed is sitting in chromatin. Chromatin includes DNA that's wound around nucleosomes, and these histones have characteristic marks that the subset of which are really hallmarks of active transcription regions. The presence of these GAA repeat expansions lowers the level of these histone marks of active transcription sites.
Does that mean the DNA can't effectively unwind from the histone? Like, I'm just trying to better understand, like, the mechanics by which these repeats really interfere with that transcription process.
Yeah, so when you don't have as much of the active marks of histones, that means the transcriptional normal elongation process is impaired, so in normal transcription, these histone marks are recognized by a class of proteins called BET proteins, and they go to these active marks at the histone and serve as the nucleating point for the assembly of a transcriptional elongation complex, and so when you don't have the marks, you don't bring in these BET proteins normally, and transcription occurs, but the efficiency of transcription is poor.
Got it. What is the elongation complex?
So the process of transcriptional elongation occurs, you know, after the polymerase has initiated transcription at the gene. But transcriptional elongation involves making RNA based on the DNA template. So every nucleotide of RNA that's added to this growing chain of RNA is the process of transcriptional elongation, and so the polymerase has to, you know, go through that region and keep adding the RNA. So the absence of these, you know, active marks of transcription slows down or makes that transcriptional elongation blocked, which is why this pathology occurs. So what we've been able to do with GeneTAC DT-216 is come up with a small molecule that recognizes those GAA repeat expansions in intact double-stranded DNA that's sitting in the chromatin.
And the other end of the molecule mimics the natural histone tail, and so it attracts this key player, BRD4, to that location, which then starts to look a lot more like it should for an actively transcribed gene. And so BRD4 is specifically brought in by DT-216, and now, once you've brought in BRD4, it serves as the nucleating point for the assembly of the other proteins that are required for normal transcriptional elongation to occur. And lo and behold, once you bring in BRD4, all of the other proteins assemble. The polymerase now sees this as an actively transcribed locus, and it gets through the transcription elongation process much more efficiently. And that's how you relieve the fundamental block, get back to normal levels of pre-mRNA production, despite the presence of that mutation.
Are there normally rules around the interval between elongation marks? Is it just simply a matter of we need the regular elongation marks in DNA for the transcription process to occur, and you've just really spread them out too far, or is it more nuanced than that?
Yeah. So, the beauty of these GeneTAC molecules is that they bind to the GAA, and then they all localize next to one another to these co-located contiguous binding sites. And so we've seen experimentally that the presence of GeneTACs, which cooperatively assemble at this site, brings in sufficient BRD4 without needing to rely on histone acetylation marks in order to solve the elongation block. So essentially what we're able to do is get back to normal levels of transcription, and all of the other control mechanisms, the promoter, the transcriptional control, the post-transcriptional control processes are all intact. And so what we see is a restoration of normal levels of frataxin with all of its isoforms, as you would in a gene that didn't have the mutation.
I guess just conceptually, to understand this, is it accurate to describe it as you're kind of artificially creating histone marks to recruit the complex because they're not where they should be?
Exactly.
So you just compensate by putting-
Exactly
Tons of them in?
That's a great way to think about it, yeah.
Okay. So describe a lot of that. So there are a number of potential factors to recruit as part of the elongation complex. Why BET specifically?
You know, it's a natural choice because in nature, there's a, you know, wide literature base to support that this is sort of a key nucleating factor. And so once you bring it in, all of the other assembly is just a downstream natural consequence once you bring in the key player.
Right.
We've got designed ligands that specifically interact with this bromodomain protein with, you know, high specificity and selectivity, and so we can recruit it to the site in a form that is amenable to pharmaceutical development.
Got it. So now you wind up with an mRNA that has all these repeats in it, but they. Are there any issues in terms of the translation of the mRNA into protein, or do they all just get spliced out and-
Yeah, the repeat is in intron one of the frataxin gene, and therefore, the repeat that's transcribed ends up in an intronic region of the RNA, which is just naturally spliced out. And we know that patients make normal, finely processed RNA and normal protein. And so essentially, what we're doing is just increasing the quantity of that normal endogenous RNA, and therefore, protein. And all of that, all of the downstream steps, once you've solved the elongation block, are all natural.
Maybe we can walk us through some of the preclinical findings, the models that you evaluated the program in, and then we can move to the clinical observations.
Yeah. So, this observation has been seen in a very wide variety of cell types. So we've looked at, you know, various, cell types from blood. We've looked at terminally differentiated neurons that are derived from primary patient cells. We've looked at terminally differentiated cardiomyocytes. And really, in all of these cases, the effect of the compound is the same, which is to relieve this transcriptional block, and you restore RNA expression and then protein expression. We did verify with a prototype molecule that this activity was also seen in a transgenic model where the frataxin gene is inserted in a mouse. But really, what we've been able to do is go well beyond that at this point.
We took DT-216 into the clinic, in patients, in FA patients, and we were able to see very clearly that within about two days, as measured by muscle biopsy, the presence of about eight to 10 nanomolar of drug led to a clear increase in frataxin RNA expression, and that was fantastic because now we've been able to verify in patients with FA that the pharmacology that we saw in cells and in preclinical models works in the clinic. The issue that we observed in the last clinical study is that the duration of drug exposure was much shorter than we had wanted, and therefore, the duration of the pharmacology was shorter than we wanted.
So we saw it at day two, but by the time you get to day seven, the drug levels had dropped off to one nanomolar in the muscle, and therefore, it's not surprising that the pharmacology dropped off. So the challenge we took on was to be able to see if we could increase the duration of exposure, without changing the molecule, 'cause we now know we have a molecule that has demonstrated pharmacology in the clinic. And, thankfully, we were able to develop a new drug product, a new formulation, with the same molecule that we took into the clinic, and we've seen data, and we've shared this in our deck, a substantially increased duration of exposure and level of exposure.
That sets us up well to be able to then go back into the clinic and see if we can extend the duration of pharmacology and get to an increase in endogenous frataxin RNA and protein, which has been, for the field, you know, a long-desired profile that's been really impossible to achieve without a mechanism like this.
Can you share a little bit more about those formulation changes that you're able to make, that really changed the profile?
Yeah, we, in the prior drug product, we had just used off-the-shelf, excipients. And we found that there were limitations of that, of that excipient. Not only did we see the short duration of exposure, we also saw some, potentially, limiting injection site thrombophlebitis events that would prevent us from increasing frequency of dosing. By going into novel and proprietary excipient space, we were able to generate data that we believe solves both of these problems. So, this new excipient really just does the job of an excipient more effectively, and as a result, we get a much extended exposure profile, much extended duration of exposure, and we now have seen this drug product be available by sub-Q injection as well as IV injection, which gives us an alternate way to increase the duration of exposure.
And so all of those changes have put us in a position where we have not just an incrementally better exposure, it's a dramatically better exposure profile that we're verifying safety with in GLP studies so that we can go back into the clinic.
Will you be measuring frataxin by mass spec or IHC? And I guess that'll determine what kind of levels of exposure you think you need to hit.
Yes. So, the frataxin measurements have been widely done in the literature. There are lots of reports looking at, frataxin expression, both by, antibody, you know, not really immunohistochemistry, it's more just an ELISA or by mass spec. I think the field has, in general, moved to using mass spec as the sort of gold standard for detection of frataxin protein.
Right.
That's the direction that we're exploring.
So what kind of increase in frataxin mRNA do you think you need to show to kinda I think it's maybe around the 5% frataxin level of normal, of protein. Do you need to hit 5% of normal mRNA? Like, how do we think about where you are from moving from that first generation to the second generation, and where you ultimately need to be there?
Yeah. So, one of the sort of touchstones to guide us is that carriers who have about half the level of normal frataxin are clinically completely asymptomatic. And so I think that gives us guidance of, you know, in an extreme case, what can one do to address the underlying cellular health restoration? Now, having said that, we've heard pretty uniformly from key opinion leaders that any real increase in endogenous frataxin could in itself have therapeutic utility. And so where we need to sit between the baseline levels of patients' frataxin and carrier levels is something that we'll have to investigate, but any measurable increase in endogenous frataxin is thought to be, you know, highly beneficial.
Okay. How do we think about potential off-label kind of marking of DNA with GeneTAC? Do you kinda cover every GAA repeat throughout the genome, or are there other parameters that direct DT-216 to the intended-
Right
Site of action?
So long GAA repeats tend to drive genomic instability at the repeat locus. So there is essentially a selective pressure against having long GAA repeats across the genome, so there's really not that many long GAA repeats to begin with, as a result. Secondly, the effect of the GeneTAC is only in, functionally in cases where there's already an actively transcribed gene. So transcriptional initiation needs to have occurred for an elongation block to have any functional effect. So when you layer in the uniqueness of long repeat stretches with the active transcribed genes, it makes sense that the DT-216 seems to have a highly selective effect at the frataxin locus. Far selectivity over, you know, other portions of the genome. This is actually published in our Science paper, and you can look there at how exquisitely selective this is.
Now, of course, ultimate test of that is in all of the safety studies that are required for off-target effects in, you know, in the typical evaluation of pharmaceutical compounds. And since we've been in the clinic before, we have a lot to... a lot of data showing that DT-216 has the selectivity to actually be suitable to go into the clinic, and we're repeating those studies with the new drug product.
Right. Maybe a final question on this program, and we'll turn to DM1. Maybe just lay out the clinical development program and milestones we should be looking for.
Yeah. So the rest of 2024 is to complete the formal confirmation of the preliminary tolerability and safety we've seen with DT-216P2 in doing GLP studies that would be necessary to go back into the clinic. Our first objective is to verify that this increased exposure that we're targeting with DT-216P2 is, in fact, seen in humans. And the way we plan to do that is to evaluate DT-216 initially in normal healthy volunteers, confirm the pharmacokinetic profile, confirm injection site tolerability, so that we have that data set to then inform subsequent studies.
Yeah.
Those subsequent studies would then be in patients, where we'd be certainly looking for, you know, safety, tolerability, but really importantly, pharmacodynamic effects. Those studies are also slated to begin next year.
Got it. Well, as we turn to myotonic dystrophy, so the goal here, very different than in Friedreich's ataxia, where you're trying to read through these, these repeats. You're now trying to shut down the transcription. So maybe help us understand how you're applying GeneTAC for that goal.
Yeah. So the repeat in the myotonic dystrophy case is not a GAA, but a CTG nucleotide sequence. And in the myotonic dystrophy case, really you only need one allele that is mutated in order to get the disease pathology. So the mechanism of disease in myotonic dystrophy is that the DMPK gene has these CTG repeat expansions in them, in the untranslated region. And those repeats are read, and you make an RNA with these CTGs, and the Cs and Gs fold over on themselves, they form hairpins. And because there are so many of these repeats, the RNA literally looks like an RNA hairball, and you can see it, and you can stain for it in cells from patients. When you look under the microscope and stain for you know either the repeat, you could see it as intranuclear foci.
And what these RNA hairballs do, these Cs and Gs, they look like splice sites. So splice proteins go in, and then they get caught and sequestered in these toxic RNA, and as a result, there's a spliceopathy across the cell, across a variety of genes, and that's what drives the dysfunction. So the therapeutic objective here is to dial down the expression of this mutant allele and the mutant RNA. And we've been able to do that quite remarkably in cells from patients, where treatment with the DM1 compounds causes these foci to essentially completely go away, which is a remarkable thing 'cause these are, you know, trapped in the nucleus.
The GeneTACs that we've created there recognize these CTG expansions, assemble at that locus, and recruit repressive machinery, so in this case, that dial down the transcription, and as a result, these toxic RNA, you know, go away over time, and that's what restores normal splicing and restores normal cellular health. The field is very excited at the success of, you know, other companies in this field, which is very encouraging because it shows that even a modest reduction in DMPK levels has been observed to have clinically measurable consequences. And so we feel that we're positioned here with a potential best-in-class molecule that is able to really go after making these toxic RNA go away.
Why, why do these repeats not interfere in the same way as in Friedreich's ataxia with the elongation process?
They're in a different part of the gene, and there's a different genomic context.
Yeah.
And so CTG repeats seem to get transcribed totally fine, whereas GAA repeats, you know, slow down the efficiency of transcription. It's just the nature of the sequence expansion. And so knowing that you have toxic RNA that has to get dialed down, you know, creates a different therapeutic objective, but thankfully, we've been able to show that we can make molecules that can do this, and they have allele selectivity. That's the other really neat feature of the data, is that we get selectivity for the mutant allele over the wild-type allele, and the wild-type allele is fine, and so, you know, all things being equal, would certainly be preferred to leave the wild type, you know, alone.
What are the next steps for this program?
So our next milestone there would be to declare a development candidate. We're working actively on that, and as soon as that is declared, we'll have a path and visibility for when we'll be back in the clinic. But again, given how well others in the field have been able to see a DMPK lowering result in clinical. In fact, the path to clinical development is more clear. And you know, we'll be able to lay out a plan that should fit well within our cash runway to get to a clinical POC in DM1.
Are these small molecules with limited oral bioavailability? Like, what are the prospects to develop something that can be taken orally?
Yeah. The advantage of small molecules is that they distribute widely across a wide variety of cells. There's no antibody conjugation, there's no selectivity to just one, you know, organ type. But they do need to be injected. So, you know, we haven't explored the oral option very much because we have a sense of urgency to, you know, bring these forward to meet the, you know, unmet need in patients, and injectable products in this type of condition would be, you know, completely acceptable, and, you know, given the fundamental nature of the mechanism.
So we don't have time to go through the Fuchs' program, but maybe just at a very high level, what is it you're looking to accomplish? Is it more proximal to Friedreich's ataxia, or closer to myotonic dystrophy?
Fuchs is more like myotonic dystrophy, where we're trying to dial down the transcription of TCF4. We have an IND cleared. We're in phase, you know, one development, setting up for phase two, and the goal in Fuchs is to then be able to conduct a-