Morning session. We're on second day here at the 2025 Global Healthcare Conference, and welcome to Miami, everyone who arrived this morning. I'm Mani Foroohar, Senior Analyst at Trek Medicines. I'm here at Leerink , very happy to have both Mitchell Chan and Curran Simpson from REGENXBIO. How was the trip down, guys?
It was good. I was hoping the pilot would divert around the thunderstorms, but he went straight through, but got us here quicker.
That sounds very much like Miami International Airport. I've had that experience.
All good. Happy to be here. Happy to be warm.
We're always happy to have you guys. Before we dive in, let's take a quick minute. You had the close, the 121 deal. Do you guys want to do a quick review of what that means for where you guys are balance sheet-wise, OpEx, economics of that deal, just for those who aren't super close to the details?
Sure. Mitch, do you want to take?
Yeah, I could definitely start off with the 12-1 deals. First and foremost, we're very excited to have Nippon Shinyaku as a partner, just because it's not your typical household name to some, but I can reassure everyone, it's actually a very good partnership because they have a strong presence here in the US, especially in the rare disease space. I think when we were evaluating a partnership, we really wanted someone who could hit the ground running as our MPS II or Hunter Syndrome RGX-121 comes online. From that standpoint, that is great. The deal economics, we received an upfront of $110 million. That would actually extend our cash runway well into the 2026 timeframe. On top of that, it comes with additional regulatory and development milestones. We said it was up to $40 million.
In addition to that, we also could receive more than $600 million from commercial sales milestones. That also includes royalties as well. What we have said publicly is that it's a meaningful double digits. All in all, this is a very good deal. If you actually read the press release all the way to the bottom, I know some people just always focus on the top, we actually retained full ownership of our PRV for both 121 as well as 111. 100% of the PRVs, and we could debate how much these PRVs go for these days, but we're very happy to retain both of them. All in all, this is a deal that we're very excited about.
I think it also has a strategic element to it as well, that we'll have an FDA inspection of the facility this year. We've obviously gotten very close imminently filing the last module of the BLA. All of that work and all of that in terms of having a commercial supply chain will play into the Duchenne program really nicely. We'll be prepared to move as quickly as possible on 202 based on what we're learning for 121.
Let's talk a little bit about that overlap because I think the manufacturing nuance gets lost. Presuming that we, as our model presumes, I think you do as well, that you proceed to launch with Nippon as expected, and there are no hiccups in manufacturing, et cetera, all the inspections go as expected, I think everyone upon this panel expects. To what extent does that de-risk manufacturing and eliminate some future potential inspections, et cetera, for DMD? And to what extent are we talking different lines, different facilities? It does not quite overlap. How much de-risking/simplification of an eventual DMD filing does that actually give you on the manufacturing side?
I think it's two things. It certainly de-risks any findings that could be part of the 121 inspection. We'd have plenty of time to address. We've done an enormous amount of prep for 121 facility inspections as well, brought out outside inspectors that are either US or EMEA based, and the facility audits really well. I would argue it's low risk. Having said that, I think it means a lot to prep for the 202 piece. The nice thing as well is we run a platform process. 121, if you looked at that process versus 202, you wouldn't see a significant difference in the way the process is operated. Sort of validation that 121 is acceptable will have a significant de-risking effect on subsequent review of the 202 process.
Great. While we're having this conversation, I'm going to jump a little bit deeper in the pipeline, if that's OK, to DMD. Obviously, there's been a lot of excitement about competitor data. It's been a tough capital market environment. From the perspective of scientific interest in DMD, that remains as high as ever. Talk to me a little bit about how you think about commercial positioning versus approved agents, as well as those that are close to pivotal data/close to entering a pivotal study. Where do you guys think, how do you guys think you fall? How do you subdivide the market? What metrics do you think will be important for deciding who gets how much share?
I think a lot of it plays into sort of the design of the study. We are enrolling patients in our pivotal one and older. From the very beginning, we are anticipating the opportunity to have a broad label for the program. One of the things that we are thinking about as it relates both to the commercial setting and also to accelerated approval is, I think, in order to achieve that, you need to have data that supports an improvement in the benefit-to-ris k ratio. To date, what do we have as evidence that we are on the right track? First, I think our safety profile is absolutely impeccable to date. Knock on wood. We feel really positive that this unique immune suppression, immune modulation regimen that we have is really leading to great outcomes as it relates to safety for patients so far.
That's the base of the benefit- to- risk ratio, is having really, really clear and positive safety signals. The second is then the functional aspects of it. I keep thinking, if we just simply can repeat the early functional data that we've already got in the five patients we disclosed in November to a larger data set of 30 across a broad age group, we have a really, really positive, not just outlook for an accelerated approval, but in a commercial setting, I think we already see it. There's a ton of interest from the patient community in the sense that their perception is that the product that's on the market may have modest benefit. That's what we hear. Our goal is to show that we have consistent functional outcomes that relate to the high microdystrophin levels we're seeing.
Let's talk about when we're going to see what in terms of functional outcomes, in terms of pool of data as well, because there's a lot of quite small pools of data floating around DMD land that are hard to interpret.
Yeah, so if we think about the data, we dosed three patients in dose level one. That's not our pivotal dose. I think that data will be instructive because we'll be out to two years at a point during this year. We can show, even at our lower dose, hopefully, some level of durability, which I think is one of the issues that we keep hearing from the patient community. They're concerned about durability. We may have some supportive data, even though it's not at our pivotal dose there. We dose seven patients in our phase I-II study at dose level two, which is our pivotal dose. That data set is going to mature all the way through this year. We're trying to bundle as much of that data together rather than piecemeal results over the course of the next month or so.
I'd say in the near term, we'll be able to report additional functional data for the two patients we already reported on out to 12 months. We'll see the other five patients as they get to nine months and then certainly out to 12. We don't typically report anything at six months or so because we want to make sure the immune suppression is washed out. We'll also report on additional microdystrophin level. We're really interested to see and should report at MDA on additional biomarker data from the younger patients we've treated. We'll give updates on enrollment through the course of the year, hopefully something at earnings, just a start to that. Probably mid-year, we can be much more pointed on when we think the full enrollment of the pivotal will occur. It's going to be a busy year.
We're trying to package data as much as we can rather than piecemeal it. We want people to know what our timeline is because we know the timeline to our BLA still remains firm in 2026.
From there, let's pivot over. We'll bounce around a little bit. Let's pivot over to the late, I guess equally late, later stage pipeline, when AMD partnered with Allergan, part of AbbVie. Talk to me a little bit about what we're getting this year and how you think about commercial opportunity, given this is a market that's evolved a bit, right? Certainly since we first started talking about this with you guys in 2018.
Yep. Yeah, certainly. I think three main events this year on the 314 program with AbbVie for the subretinal side of that, which is the OR-based delivery. We expect to fully enroll both Atmosphere, which is a large 600-plus patient study being recruited in the US And just as a reminder, that's against Lucentis. We have Ascent, which when AbbVie became a partner to us three years back, they enlarged that study significantly. It initially was 300+ patients. Now it's above 600 again. Also, they globalized it, meaning we're recruiting patients in Europe now. Both of those studies will enroll this year, which will set us up for top-line data next year. It's a 52-week endpoint, plus or minus a few weeks. We think that's really exciting.
Early in the year, we talked about going through regulatory advice on the diabetic retinopathy program, which is administered differently. That is an in-office suprachoroidal administration. We are just getting through global regulatory advice now. That will enable AbbVie and us to finish the pivotal protocol. We want one protocol that is used globally because the trial will be recruited that way. We are expecting to dose a patient likely second half of the year as a first patient in. I think that is meaningful. There is a $200 million milestone associated with that. I think even more meaningful is that the global regulatory advice we have gotten to date is against a sham control. I think that explains the standard of care. There is not really an acceptable standard of care for diabetic retinopathy.
That just magnifies how we feel and how I think AbbVie feels about the opportunity that this is a perfect fit for gene therapy in our view.
When we think about the universe opportunities for 314, it's a little more complicated than a typical single gene therapy, single defined gene. There's X number of patients, and there's nothing for them. It's a little bit of a different animal because you have two presentations in suprachoroidal and subretinal. You got a fairly diverse set of markets, an extremely well-served one that I'm not the one getting a needle in the eye every six weeks, so it's easy for me to say wet AMD is well-served, and then an extremely poorly served one in diabetic retinopathy. How do you think about which presentation of 314 is best suited? Could you see are there tension in terms of pricing and value between those markets? Because obviously, the unmet need in wet AMD is different than the unmet need in diabetic retinopathy.
I think that one thing for SC AMD is keep in mind that it's at least two to three years behind subretinal. We'll have established a strong foothold with subretinal in the OR-based setting. All the feedback that we get, if wet AMD is an $18 billion market today, all the feedback we get is that that may double in the next five years or so in terms of how many patients are out there with the size of the business. Even if you can convince yourself that only 10% of patients would take a subretinal injection, that's still a huge opportunity in the context of gene therapy.
Patients that we think, and that you've just heard Roopal Thakkar at AbbVie speak about, patients who are really heavy, quote, frequent flyers in terms of monthly injections, those are ones that we think are very likely to value a subretinal approach. I would point to our recent study with the fellow eye treatment as an indicator that these are patients that have already done one eye in a subretinal injection in our studies. Now they're coming in to treat the second eye, the fellow eye. I think that speaks volumes about the benefit they perceive and also the fact that that may not be possible with other gene therapies because it's immune privileged with SR injection. I think you'll see over time, though, if SC AMD comes on the market, that could be considered a life cycle improvement.
You will see more of the business moving that way because it is an in-office procedure.
While subretinal delivery and certainly intravitreal, which is the most simple and sort of standard of care currently, these are procedures that retina surgeons, as part of their residency and fellowship training, do innumerable times. Suprachoroidal delivery is a little bit more novel, certainly than IVT. Yeah, talk to me about the device component. Talk to me about the training and how much comfort retinal surgeons out in the community have with doing suprachoroidal delivery at the vast volumes implicit when you're talking about wet AMD.
Yeah, we use the Clearside device for the suprachoroidal administration. Certainly, in our hands, in a clinical setting, we have trainers that go to site and perform the training there. The fact is that that's now a commercial device, and the training has already been accomplished in a commercial setting with another drug. I don't feel like that will be a significant bar in utilization down the road. By the time we would be on the market with diabetic retinopathy, I think the use of that device will be pretty well understood. I think most importantly, from our clinical setting, we use thermal imaging, for example, to judge how well the administration was done. We see very high success rates. We feel confident that that will be adopted well in a commercial setting.
While we're talking about sort of commercial dynamics, let's zoom out. I don't think it's a surprise to anybody to say that market sentiment on the commercial opportunity for gene therapies is pretty poor, by which I mean capital markets, not clinicians and not payers. That's a separate debate. When investors reach out to me, and certainly your investors will reach out to you and your team, and they talk about, well, how do you get paid for a one-time, or we'll say highly durable, highly durable therapy because you can do fellow eye for a highly durable therapy in a market where the incentives are aligned for chronic dosing, obviously buy and bill, et cetera. How do you get paid for that? What durability of data do you need to have in a pivotal? How do you justify price?
How do you capture share and cash flow in a real way? How do you push back on those arguments?
I think one aspect of that is I wouldn't look at it as because this new therapy is available, it takes away from the rest of the business. The fact of the matter is most retina centers are overburdened. I don't know if people have tried to schedule at a retina center lately, but it's a challenge. I think the PIs that are in our study, we have 100 sites that are activated. A good number of them, large enrollers in our study, will say, I can't keep up. The subretinal administration in an OR setting only adds to my business. It doesn't subtract from my business. I think that's one of the ways we think about it. We've looked at the reimbursement landscape for a subretinal injection in terms of how people will be reimbursed, how the centers that perform these vitrectomies will be reimbursed.
We think it's a win-win in terms of where we are. We've spent a lot of time making sure our cost of goods for a sort of non-rare gene therapy are in line. I feel like the value proposition for something where we're showing durability out to three and a half, four years now on some patients is very much in hand. Certainly, we're going to leverage the commercialization muscle of AbbVie along the way with this. That is just another thing that I think has us feeling like this will be a successful launch and a really important therapy as part of the many options that are out there.
Let's slide down the way down epidemiology glyph back towards DMD, a place where that argument apparently doesn't exist at all and no one argues that something's not going to get paid for. Clearly, reimbursement in that market is fairly robust and continues to be robust, almost independent of data quality. The debate there becomes access to patients and to what extent is there a pool of patients that are either A, not yet treated by a one-time viral therapy, or B, not eligible. We think about the opportunity set. This is a little bit of a follow-up to earlier question. The opportunity set is driven by those ineligible to a competitor that is approved ahead of you? Do you think the larger opportunity set is patients who are choosing not to take the approved therapy for reasons of efficacy? How should we size those?
What are you tracking in the market to confirm your hypothesis?
We are doing studies on the prevalent market that's out there. We can also look at the consensus estimates as well for, with a potential launch in 2027, how many patients would be out there just within the prevalent market, and then how many of them are eligible for our therapy. It's a significant number. It's at least half of the prevalent market that should be still available to us at that point. I think the drive for broad label and making sure that in our clinical study, we have enough exposures across those age categories, if you will, to enable that. I think the second part of it, the reason we opened up one to four cohort in terms of age, was that over time, that'll move to an incident population where off-newborn screening patients will likely be treated early should durability be demonstrated.
We will have the data to support that as well. We are trying to prepare for making a significant inroad to the prevalent market, but also being ready to challenge on an incident market basis. The decision that we see a lot of parents of boys diagnosed with Duchenne's often related to their disease progression. For parents of children where they know their child is declining, there is more of an urgency to go on to the commercial option. For patients where they were maybe newly diagnosed or they are continuing to see functional improvement, they are willing to wait for these new class of microdystrophins. There are plenty of them out there in terms of if we segment the market, this is a significant 30% to 40% of the market are patients in that sort of category.
Those are typically patients that are in the four to five range where they've been newly diagnosed, not through newborn screening, obviously, but traditional methods. There is a lot there. I think one of the things that is different for our programs than others, we're going to begin stockpiling commercial material next year in-house. We have control of the manufacturing. We have control of the fill finish. We can stockpile 2,500 doses a year. We will not just launch in 2027. We are capable of coming in really heavy in terms of supply availability to really make inroads to the market.
Let's talk a little bit about, oh, hello. We've talked about positioning for that market. Let's talk about how to compare data between gene therapies for DMD. Every time a data set comes out, I and all of my colleagues at other banks write a note with about a paragraph talking about how unreasonable it is to compare across trials and how it's statistically fraught and completely unjustifiable. Then we spend 16 pages comparing across trial. When we think about functional metrics, what caveats would you apply as we compare your data in the future with what's on label for the approved therapy in a somewhat different population of patients, to be fair, versus some of your competitors? Should we be mostly focused on baseline functional outcomes? Should we focus on age?
How should we think about not letting ourselves be sort of confused by the variability amongst this patient population? Because while DMD is universally tragic, it doesn't progress at a universal speed.
Yeah, I think you pointed out one of the main aspects because we know people are going to make comparisons. We try to avoid it from our standpoint, but we definitely want to guide people correctly. I think making sure you're thinking about age as part of those comparisons is really critical. Certainly, the younger patients, as our data set expands, we can see that the microdystrophin levels expressed in patients that are younger is typically higher. As those patients are older and treated, you're not quite able to get the same level of transfection as you might expect. Having said that, we're really excited that in our older patients, we're seeing roughly three times the level of microdystrophin. We're seeing no patients that are coming in at zero, which I think is incredibly important.
If you look back to the Adcom data for Elevidys, seven or eight patients that you can see from Peter Marks' graph were at zero. I think that really factors heavily into the decision-making of a parent who knows, I could treat my child. It's a one-time treatment. You would be precluded from other gene therapies likely. I might end up with no microdystrophin as a result. We haven't seen that. Every single patient we've treated is above the threshold level that we have as our primary endpoint. I think that's an important way to think about it is consistency above a certain threshold is maybe more important than 35% versus 45% in a five-year-old. I would just caution. I think we're really interested that we're seeing benefit in the NSAA score versus baseline and certainly versus the matched external controls that we use.
People had given up on NSAA. I am hoping that that is evidence of a stronger drug effect on function. Time will tell as our data set grows. We know it is early. We are just looking forward to updating people through the year on additional functional outcomes.
That makes sense to me. I think one of the other debates is, as people consider the decisions being made by Duchenne parents, and this is largely obviously as one would expect a parent-driven decision, what are you seeing in terms of reticence to enroll in current competitive agents or take current approved agents? How much of a backlog of parents is there waiting for what's next? Because it's a heartbreaking decision these parents have to make. You have an approved therapy, many agents in development, but they are running against the clock, unfortunately. Talking about how we should think about, is there a warehouse of patients? Are those patients the very youngest? Are they the oldest and most severe and therefore not eligible for some of the existing therapies? How should we think about the population of patients who you'll be able to serve first?
Yeah, the day after approval.
Yeah, I think that it's all of the above. The patients that we enrolled early in our study were a bit older. It was, as you mentioned, an outcome of they weren't eligible for other studies necessarily. They were interested in our program. I think as time has gone on and the data has come out on the biomarkers and now the functional data, it's different. The willingness to wait for 2nd generation therapy is increasing. In many cases, we hear, at least in the clinical setting right now, it's easier to enroll in a clinical study than it is necessarily to be treated with a commercial product due to the wait time on reimbursement, et cetera. Eventually, it comes, but it takes time. As you said, the patients may not be there or the willingness to wait may not be there.
Down the road in a commercial setting, I think this is all going to come down to function and the perception of, is this one-time treatment going to likely lead to a functional benefit for my son? I feel like our data, again, if it reproduces in a larger data set, is going to be extremely compelling to a patient or a parent of a patient diagnosed because that's what they care about is can they play sports that they could not play before? Can they ride a bike that they could not do before? This is what we hear from every investigator, that microdystrophin is, I think, a surrogate for propensity for functional benefit. Ultimately, the functional benefit has to be there. We intend to back that up with our data. We think we have a unique differentiated construct.
We think that that can lead to better functional outcomes than what's available today.
I do want to touch a little bit on, obviously, there are some reimbursement hurdles, though relative to the cost of these therapies, relatively modest, but real, as you mentioned. Talk about what you can do as now in development and also in the early days of launch to position yourself to have the lowest hurdles reasonably possible for what is admittedly still a complex therapy. This is not a pill.
I think this is where being a fast follower is a huge advantage. One of the initial constraints were just these sites were normally running clinical trials. They were not delivering commercial material. Now there will be two years of experience delivering commercial material. I think really just working through the logistics of supply, working through reimbursement, all of that ground will have been paved. We can take advantage of those learnings and incorporate them into our launch to be as fast as possible. I think also having a really, really significant inventory of product available at the time of launch. Again, the prevalent market from Sarepta's own statements will be available until 2030. There has to be some constraint in there. Drug supply may be one of them. We are not sure. We are intending to make sure that is not a factor.
Great. We have run over time. That's my fault. Thank you again. It's been a really great conversation.
Thank you for having us.
Looking forward to a lot of news this year.
Appreciate the time. Thank you.
For having us.