Hello, everyone, and thank you for joining the HCWainwright Fourth Annual Ophthalmology Conference. My name is Vivian, and I am an analyst on the corporate access team. HCWainwright is a full-service investment bank dedicated to providing corporate finance, strategic advisory, and related services to public and private companies across various sectors and regions. We have a total of 24 publishing senior analysts and over 650 companies covered across all sectors. If you would like more information, please visit hcwco.com. From a logistics standpoint, please make sure to reference your virtual conference online portal that provides your individual links to your meetings and all presentations. With that said, we wish you a productive and enjoyable day. Now, I will hand it off to Brian Culley, the Chief Executive Officer at Lineage Cell Therapeutics. Brian?
Thank you, Vivian. A pleasure to accept the invitation to present on this conference today. We always enjoy the support and research coverage that we have with HCWainwright. As a public company, of course, I will refer everyone to our forward-looking statements in case I make some such statements. You can learn more about our risk factors through the website sec.gov. All right, so just a brief level set on Lineage. Yesterday was our quarterly call. We updated our financial position at approximately $38 million. That will provide support for our planned operations at least into the fourth quarter of next year. The company has about 75 employees, principally located in Southern California, and we also have a manufacturing facility located in Israel.
As this is an ophthalmology conference, I'm really going to focus only on our lead asset, OpRegen, which is an RPE cell transplant to treat dry AMD. So we are manufacturing RPE cells, which are an integral cell of the retina, and transplanting them to the patient eye in order to replace and restore the activity that is lost and try to prevent the blindness that occurs from this condition. Dry AMD is a massive unmet need. There are two forms of it. They are called wet and dry. The wet form of macular degeneration actually is very well treated. There are $12 -$13 billion in sales for products that address the wet side of macular degeneration, but the dry form of the condition, which is eight times more common, only has a couple of recently approved therapies, and they are woefully inadequate.
They do nothing to stop the disease, and so we see a great opportunity here to help millions of people around the world. Our approach is quite simple. On the left, pre-transplant, this is a cross-section of a person's retina. As you age, the RPE cells, which provide many important functions for the retina and for your ability to see, they die off. And so if you can manufacture brand-new RPE cells and deliver them to a patient, you may be able to either slow the progression of this disease or, or halt it, or hopefully bring back vision, and we actually have seen that in clinical studies to date. How we do this is we start with a pluripotent cell line. So pluripotent cell lines have two remarkable capabilities.
One is that they can self-renew, so you can continue to grow the cells. They will not change, so you can have enormous numbers, many, many billions of cells, as a starting material because, again, they are self-renewing. The other incredible property of pluripotent cell lines is that, by their definition, they can become any of the more than 200 cell types of the human body. They don't require genetic editing to do this. You can just provide them with biological instructions, and if you want to manufacture T cells, or you want to manufacture lung cells or any cell of the human body, that information is within those cells. So we provide those cells with the information to become RPE cells, specifically one mature form, one very specific cell type, and that's the cell that's lost in the setting of dry AMD.
Now, if you want to be in the game in cell therapy, it's more than just making the cells. You have to have control of your process. It must be reproducible. You can understand quite easily that the complexity of manufacturing a specific human cell type is vastly beyond the complexity of manufacturing a small molecule, or even an antibody, or even a complex biologic, because the entire cell has, of course, billions of different positions and component parts that you need to consider. You also need to be in control of your purity and identity. Potency is an important component of the material you make, and of course, the scalability in order for it to be commercially viable. We have accomplished all of these things with our RPE program. There are many companies that work in cell therapy that really struggle with the manufacturing.
We have nailed this. We have excellent control and reproducibility of our material. The purity and identity has been exhaustively characterized, and we have multiple potency assays to understand how the cells perform, and we have scaled. Even within a 3-liter bioreactor, we can make 2,000-3,000 clinical courses, and that's by harnessing the power of the self-renewing capability of pluripotent cell lines. We are using these in an allogeneic form, so this is off the shelf. We never go back to source new donor material. The cell line that we use is and will be the same cell line forever and ever and ever, and because these cells are self-renewing, you can drive down the cost of goods far lower than what you may be accustomed to in the oncology cell therapy world, where you have a bespoke or a custom therapy.
One individual is donating cells for their own purposes.... This technology that we have used is one of the very rare cases where a cell therapy company had attracted interest from Big Pharma. And not just any Big Pharma, I would argue the best ophthalmology company in the world, which is Roche, and in particular, the very innovative side, the Genentech side. So we signed a $670 million biobucks deal with Roche and Genentech. It had a $50 million upfront payment, and they and we are working to try to demonstrate that by transplanting cells, you can get much greater clinical outcomes than just by adding a small molecule that might only hit one pathway, or an antibody that might target one signaling transduction pathway. When you replace the cell, you're replacing every pathway simultaneously.
That's incredibly powerful and incredibly exciting. After we had entered into this agreement, and after Genentech had initiated a clinical study, approximately a year and a half ago, we actually entered into an additional, a new and additional agreement with them to further expand the work that's been going. So while we have not had any, any data updates from the ongoing trial, I think it is notable that that trial has been running, data has been collected, and we have seen presentations, from Roche and Genentech of this program, and we have expanded the alliance. And that's really encouraging because this is an environment where Big Pharma, in particular Roche, have been reducing and prioritizing their program. So we seem to be being treated in the opposite direction. There's investment in our program. So what did Roche and Genentech see?
Well, we completed a phase I study in 24 patients. The first 12 patients represented on the left, they were all legally blind. They had very advanced disease, just a safety component. We weren't expecting to see any sort of efficacy. There was a small amount of improvement. Patients really didn't lose vision after 12 months, but these are very injured patients. The area of damage in their eye is extensive, and we don't emphasize anything other than the fact that the therapy was well-tolerated, and there were no reports of rejection. And these are patients that have had their cells in their eyes for years now. But then we moved to cohort four, and these were 12 patients that had. They looked more like customers to us.
They had areas of atrophy that were good, rich targets for therapy, very comparable to the Syfovre and Izervay patients that were treated in those clinical trials that led to their approval. And what was seen in a handful of these patients, patients that received our cells right on the area of atrophy, it was quite exciting that those patients had a restorative feature. The retinal architecture of the key layers of their retina appeared to have improved. The reason why that's incredible is that that never happens naturally. Human beings do not have the capability to regrow or heal or restore their retinal tissue. So we were transplanting cells in that were making the visual appearance of the retina look more normal. At the same time, these patients were enjoying an increase in their vision. Again, that should not occur.
The normal course of therapy for these patients, let's say over two years, is they should lose seven, eight, nine letters of visual acuity. These patients, as a group, had increased five and a half letters at two years, and the five patients that received our cells fully across, a really nice coverage of the cells across, they did even better. They had increases of more than seven letters. So you're talking about, about a 15, 16-letter difference between patients that got our therapy in the right place and patients that were untreated or were treated with the best available therapy. So these are extraordinary clinical outcomes. Visually speaking, the way that you can observe this is to look at a number of different layers by using high-resolution OCT imaging.
And I know that very few of you are going to be experts in the you know nine, 10 layers of retinal tissue, but you can colorize these, and you can see the before and after on the right. Baseline would be looking at the outer plexiform layer, looking at the RPE-drusen complex, and you can see it breaks down. I mean, literally collapses down or is incomplete. But after treatment with our cells, after transplant of normal, healthy RPE cells, those areas of retina have been restored. This is data that has been reviewed multiple times using multiple different technologies and using a masked reading system and including proprietary reading systems from Genentech. And time and time again, this is clear, independent, objective, visual evidence of improvement in retinal structure. And it didn't just happen in one patient.
As I said, there were five patients in particular who got full coverage of our RPE cells, and they all exhibited these improvements, sometimes happening in just days or weeks, but always happening within three months. So this was very exciting to see that this was a reproducible effect, an effect that never happens naturally, which means you will never have this occur on a control arm in a clinical trial. No one will be, unless it's an error, no one will ever regain retinal tissue on a control arm in a study of OpRegen versus untreated. The technology that's used to visualize this is not limited to just an OCT cross-section, but you can actually quantify and make these density-based maps and actually measure how much of the RPE-Drusen Complex, or how much of the External Limiting Membrane is present.
And as you work your way through, 'cause you're not being selective and choosing just one data point, but as you work your way through the area of atrophy, what you can see is this restorative phenomenon can occur in 360 degrees. And again, it's durable. It's lasting for years. So there is a durable improvement and gain in retinal tissue, which cannot occur naturally and is being accompanied by increases in vision. The interesting point of extensive coverage of our cells versus more limited or adjacent positioning of the cells, because I should point out that when we first started doing this, we tended to deliver the cells away from the area of damage. It was just a safety study, but a happy accident where the cells covered the area of atrophy led us to pursue that area of investigation.
So we intended to deliver the cells across the area of atrophy in a handful of patients. There are five for which that was successful. This is a very nice data, again, coming from our partners, Roche and Genentech, looking at the RPE-Drusen complex and showing that those patients who received extensive coverage, that study eye had an increase that was sustained of the RPE-DC complex compared to their untreated eye, which, as expected, lost tissue. This phenomenon was not as profound when there was limited coverage. Perhaps there's some trophic factors of these cells, but it really helped refine the point that delivering the cells right to the area of atrophy is important. You can find this also with the external limiting membrane. Again, another critical and necessary component of your retina.
In the study eye with extensive coverage, it was increase in tissue area compared to an untreated eye, and then again, it did not occur when there was limited coverage or adjacent coverage of those cells. So the lesson here is it is very important to deliver the cells because this is a transplant. This is not arm's length cells secreting trophic factors and, you know, doing magical things in the eye. This is a lot more like, 80 years ago, when it was discovered that you could do a bone marrow transplant and rescue an irradiated mouse. This is providing brand-new tissue to an injured area, and as long as it is durable and as long as it is not rejected, it is retained and functional, and you can provide function to the patient. Here's a case study example.
What I really look to highlight here is even just visually looking at the area of atrophy in the bottom panels, those five signs of GA. It's an aerial view of the GA. You can see it expanding, it's getting larger, it's really well defined. Whereas in contrast, the area of GA that was treated, this is a patient you can see almost like a dissolution. It's like melting away the area of atrophy, and this patient has had very stable visual acuity in their study eye, compared to losing 30+ letters in their untreated eye. That is a remarkably striking difference between a treated eye and an untreated eye over four years of follow-up. As I said, these patients were enjoying visual acuity improvements. This is the whole cohort of 10 patients.
This is a comprehensive and proper way to show the data. You can see 7 letters gained at 1 year and 5 letters gained relative to a control eye. This is the patient's contralateral eye, which, by the way, is always the eye that's in better shape at baseline. So we're handicapping ourselves, as is standard in ophthalmology, by treating the worse eye. But if you go further from this blue line, these patients had an increase in vision that persisted for a long time relative to an untreated eye that typically did not have as severe disease. If you look at the patients that had coverage right on the area of atrophy, they gained 12 letters at 12 months and 7 letters at 2 years. They did even better. Safety summary looked very encouraging, things that you would expect from an ocular surgery.
This is a surgery that takes about 30 minutes. I do want to emphasize that there have been zero cases of rejection. We probably have crossed over 100 years of patient exposure with these cells. Patients in our hands were doing 90 days of systemic and local immunosuppression, and then immunosuppression was ceased. We believe that the systemic immunosuppression was excessive and not, not necessary, so we think that the attribute of the eye being a compartment that is not loaded with white blood cells allows it to accept human cells without rejecting and without high doses of immunosuppression, or without having to edit into a hypoimmune cell line. These are non-native cells that are transplanted, and they're being tolerated for four, five, six years in these patients without immunosuppression continued.
The study that is being conducted today through our partnership with Genentech and Roche is an approximately 60-patient study looking at the proportion of patients that receive cells to the target area. We discovered late in the phase I/II study that we did that delivering the cells right to the area of atrophy was an important and probably necessary action in order to get the best possible clinical outcome. So we were not able to determine what the hit rate or the success rate of delivering cells to that area is. We tried two different attempts: going into the front of the eye with a retinotomy and going around the back of the eye, up below the retina, using specialized equipment. I can tell you the standard, ordinary, and common way of going in through the front of the eye was successful four out of four times.
So we do think that this is a very accessible and achievable surgery. When we use specialized equipment, I recall we only were successful one in three or one in four times. But there are trade-offs, and this is part of the partnership, is to understand and determine what's the best way to deliver these cells so that you can have the best possible profile of safety while also driving these clinical outcomes that are far beyond what is available for FDA-approved therapies today. This study is currently enrolling. There are five sites open. I actually announced publicly yesterday that a sixth site was just recently opened. It's another experienced site. It's our first ex-US site. We're very excited about the continued progress with this program.
OpRegen, thus, this RPE transplant is a radically new way to treat Dry AMD, where you can address all of the problems of the cell, not just one pathway like complement, but everything that's going wrong. Because frankly, by the time you're 80 years old and you've worn out your RPE cells, there's a lot more going on than just inflammation. So this approach is a multi-billion dollar opportunity. We have shown that we can improve the retinal structure of patients, which never happens naturally. We have reduced, and we hope to continue to reduce, the immunosuppressive burden, but we've had zero cases of rejection. This is not a therapy that's limited to monogenetic, monogenic deficiencies. So if you think of gene therapy, and you say, "Oh, is this like gene therapy? One, 30-minute surgery, and you're done for the rest of your life," we believe that to be correct.
But unlike gene therapy, that can only fix one gene at a time, we are, again, fixing all genes simultaneously by providing you brand-new RPE cells. We saw durable increases in vision at 12 and 24 months, which were exactly contrary to what you'd expect over 24 months with an untreated or anti-complement-treated patient who should be losing seven, eight, nine letters. You can read about that in the Lancet article that came out describing that. So we're seeing massive divergence in the functional assessment of visual acuity that is joined by the anatomical improvements. We think there are additional retinal diseases this could be applied in. We have excellent patent coverage for this program, fast-track designation, and of course, we stand almost alone with, well, at the time, the largest non-cancer cell transplant deal that's ever been done.
I want to conclude by saying that our approach that we are pursuing in ophthalmology is just the beginning. We have very few competitors in this space, but there have been a handful of companies out there, very large companies like Vertex and Bayer, that have embraced and invested in the idea of manufacturing replacement cells for other major indications that have unmet needs. These are things like Parkinson's disease, things like type 1 diabetes. We are a leader in this space, and we are going to continue to pursue this approach of replacing cells and restoring function.
As a last note for you, I want to point out that our overall neuro-focused pipeline not only includes OpRegen, which has our partnership with Genentech and Roche, but we also have 30 patients treated with a spinal cord program, where we manufacture replacement cells of the spinal cord to help people who have been paralyzed regain function. We have a new auditory neuropathy program, where we aim to help millions of people who have lost their hearing due to the loss of their auditory neurons. We're now manufacturing auditory neurons to replace those cells. We have a photoreceptor program, and we even have an undisclosed new program in connection with an editing partner that we think can introduce cell engineering.
So now we're talking about not just regular cells that are replacing what's there, but we're talking about putting in cells that have enhanced properties. This is the future of this new breakthrough field of medicine for which we are on the frontier. So thank you so much. We always keep the patients in the forefront of our mind, and we're working for solutions that are going to be revolutionary for them, and you can actually see and hear from some of those individuals on our website. And with that, I'll conclude today's presentation, and I hope to hear from some of you at your convenience. Thank you so much.
Great. Thank you, Brian, and thank you to Lineage Cell Therapeutics for leading a very productive and informative presentation. The HCWainwright team is grateful for your presence at the Annual Ophthalmology Conference and for your efforts in preparing for your session.