Welcome to the second day, the afternoon sessions of the BofA Healthcare Conference. I'm Geoff Meacham. I'm the Senior Pharma Analyst here, and we're thrilled to have Sana Biotechnology, President and CEO, Steve Harr. Steve, welcome.
Thank you, Geoff. It's super fun to see you and people in person.
Yes.
It's been a long time.
It has been a long time. Well, to start off with a sort of a 30,000-foot view, you guys, there's a lot going on, different technologies. I know you can be a little long-winded, so I'll just say.
I can be.
Too mad for left.
Yeah, too many.
Give us that.
Yeah, first of all, we will make forward-looking statements, and we spend a bunch of time writing our 10-K and 10-Q, so take a gander at it and to see some things that we think could go wrong. The company was built on the fundamental belief that one of the most important transformation that will occur in medicine over the next several decades is the ability to modify cells. Basically modify genes in new cells as medicines, and we call that engineered cells. Our goal is our aspirations, we won't do these, are pretty simple, and it's to be able to repair, you know, any cell in the body and to replace cells that are too far damaged or missing. We've built three platforms around that.
When you take a step back, you wanna make cells at scale that will engraft in the body, that will function as opposed to that will persist. The biggest challenge has been cellular persistence, and in particular, overcoming immunologic rejection. The core platform and technology the company has been building is around cloaking or cells or making them hypoimmune, hiding them from immune attack. Making them at scale. We've also built a lot of capabilities and platform around stem cell biology and stem cells.
In order to be able to repair cells in vivo, you know, really simplistically, I think what everybody's trying to do is deliver some gene modifying payload, and then alter the gene or gene expression. It turns out it's relatively easy to do the latter, and you can do basically anything you want to a cell in a Petri dish or in vitro, and the hard part's been delivery. We really focused a large effort as well on in vivo delivery of payloads. The goal is to be able to deliver any payload, DNA, RNA, protein, to any cell in a specific and repeatable way. We started with a platform around cell specificity in what we deliver, so just to a T cell or just to a hepatocyte, for example.
We've made real progress. We hopefully will have a couple of INDs in this year. We'll kinda know, you know, pretty quickly if the platforms are performing as we think they should. It won't take us too many patients to figure that out. We've set up a pipeline behind that, where we think we can deliver, you know, at least two INDs per year for the, you know, near to medium term. Our biggest challenge in getting there is actually just capabilities and technical operations or manufacturing. We just can't get more than two or three through a year. We're about 400-some people. We've got a nice, strong balance sheet.
We have capabilities really across a host of areas, and so hopefully we're in a place where we can move from, I think, doing some wonderful things to the models where we induce some type of a disease to really doing wonderful things for people who unfortunately have a disease. That's our goal for, you know, the coming years.
Perfect. Well, one of the platforms you guys developed is called Fusogen.
Yes.
Maybe just give us a quick, you know, tech background or to that for those that are not familiar. It is a newer modality when you look at, you know, sort of ex vivo cell therapy. It is a lot that you could add on to that, and there's a lot of different indications you can go after. Help us with kind of the technology itself, and then where you think you could go.
Yeah.
Beyond just, you know, the same targets that other folks are working on. There's some novelty.
Sure. I think the way we approach problems was if we were faced with a complex biologic challenge, see if Mother Nature solved it herself. When you look at delivery, actually, Mother Nature is actually quite good at delivering certain payloads in vivo to cell-specific way. A great example that we all know is COVID, right? Where it only delivers its genetic payload to cells that express the ACE2 receptor. Really what we did, the Fusogen platform is. I'll use two words, Fusogen and Fusosome. Fusogen is the targeting moiety, and the Fusosome is the whole medicine, right? With everything in it. The Fusogen, what we do is we basically reprogram a viral Fusogen so that it will no longer recognize its target.
We can put on some other cell surface, or I should say, cell-recognizing moiety, like a scFv or VHH, a little antibody. We can go after, let's just say, CD8 cells or CD4 cells, or you can go after hepatocytes with certain things or HSCs who do it. We're really pretty good at doing this. And if you give us a cell type, we'll probably be able to target it in a specific way in a Petri dish. The real challenge is then scaling that and getting it potent enough to turn it into a medicine that is, you can make at scale in vivo. We then take that Fusogen, we put it on a Fusosome, and the Fusosome is basically any...
I think it was anything with a lipid bilayer. It could be a virus, a virus-like particle where you have or a cell, are great examples. We do them all. We put some type of gene modification machinery in there. We could do, you know, simple things like using viral integrases. We can do a bit more complex things like using gene editing machinery. You can do really complicated things like, you know, I don't know, prime editing or base editing, deliver those as well. All of that can be delivered within that Fusosome. A lot of it is basically about getting payloads to a specific cell efficiently, and then we have to work on getting the right payload into the cell.
We're applying that first, really simplistically, 'cause it's the most straightforward to make. We target CD8-positive cells to deliver the payload to, and we'll just insert a CD19 CAR. The rationale for that from our perspective is when you're developing new platforms, you have platform risk, disease biology risk. Like, does it intervene in important biology? Clinical development risk. Can you prove it? We wanna isolate the platform risk so that we're not... If it doesn't go well, we know what to fix. If it goes well, we get the privilege of taking on more disease biology. That will hopefully... The first medicine using the Fusogen platform should hopefully have an IND this year.
One of your first INDs is gonna be on CD19.
Yeah.
That's a field that, you know, a lot of folks, people have used it as sort of a proof of concept of their respective technology. Are you guys looking at it that way, or is it more, you know, you feel like you can meaningfully beat, you know, the assets out there.
Yeah.
With the improvements that you've made with the technology?
As I think you know, I had the privilege of being part of the CAR T-cell space from, you know, some of its inception. One of the more frustrating elements to me is like there's not much I can think of that I'm as confident about scientifically is the fact that lymphoma and leukemia should be like hepatitis C, where we should be able to cure the vast majority of patients with these diseases with a single shot. You know, we're at a place right now where a couple things are true. First off, you know, around 80,000 people a year die of lymphoma and leukemia in the U.S. and Europe alone. In the history of humanity, only a few thousand people have gotten a CAR T-cell.
We have a lot of work to do to ensure that we are able to really get these to patients. The second is, of those who get one, maybe a third benefit. A number of patients don't respond, and of those who do, many relapse. I think, you know, we have really clear pathways to improve upon all three of those aspects: on-time scaled delivery to patients, higher response rates, and much higher durable response rates. I look at this as we're still in the era. Like, just like trying to say that hepatitis C was done when someone got, you know, launched Intron A. It was important, and it made a really big difference for people. But we can do so much better. I look at it as much more as like, yes, it's yes and.
Yes, we would love to have that prove on our platforms. We have two different ways of targeting it right now. We really think we can make important medicines as well.
Right. Given that this is your first IND, you know, obviously it'll improve the execution piece of it, but just help us with all the steps that have gone into this that you've lined up with respect to, like, manufacturing and
Yeah.
Clinical regulatory. A lot of people, you know, and processes that you've had to sort of forward integrate.
Yeah. We have two INDs that hopefully will get done this year. There's a lot that goes into both of them. I'll give you, like, a really great example of the complexity of this. Our allogeneic CAR T-cell has six different GMP manufacturing steps. We have to make starting cells, we have to make guide RNAs, mRNAs, plasmids for that you insert to use a viral integrase to the virus itself, and then the end product itself, all of which require GMP manufacturing. It's not like an antibody where there's one, right? The beautiful part of it is that allogeneic CAR T-cell, I think we make really great cells, and we make them at a scale that I'd be totally comfortable commercializing the drug with today, let alone for phase I.
I think the Fusogen is much more complicated to scale. You're obviously right. We're still in the process of scaling the manufacturing and doing all of the preclinical pharm tox studies. It's a novel platform. You know, we will need to scale this process meaningfully more for it to be at a stage where I think it's commercially really exciting, right? But that's different than an antibody, except with an antibody, you know exactly what to do now. It's more like an antibody in the nineties, right, where there's some challenge ahead of us. The other things around, you know, building clinical operations, building the development, putting the regulatory infrastructure in place, we have the great fortune of a really experienced team who's done this multiple times, and we'll get it done.
That's not the part of Sana that should, you know, force you to lose sleep.
Right. Well, the other indication too is, myeloma, right? BCMA.
Yeah.
Kinda the same question a lot. I mean, there's a lot of companies have gone after this, again, as a proof of concept as well. There's, you know, very similar. There's, you know, there's multiple therapies that are approved. They're not always, you know, highly effective. Is there an argument for you know, raising the bar on this indication as well?
Yeah, well, I would say a couple of things. One, you know, it's just amazing what's happened in myeloma over the course of the last 15 years. And there are still a number of people, unfortunately, will die of, not with myeloma. I also think it's a much more complicated clinical and competitive landscape to navigate, in particular. And by the way, if we, if we sat here three or four years ago, we probably would have said the same thing after the launch of the, you know, of the CD38 antibodies, you know? Since that time, I think the data from J&J and Legend in particular are just spectacular and really set a high bar for all of us that wanna come in the field.
The flip side of that is, you know, these are, you know, it's very difficult to scale autologous CAR T-cell manufacturing. If these are gonna move into the first or second or even third line setting in that disease, somebody's gonna have to crack the code around scale manufacturing. I'm optimistic that, you know, we can, we can do that. We have to prove two things to you. One is that our technology, which in animals, you know, and non-human primates hides our cells from immune recognition and rejection, translates into humans. Like, I don't think anybody's ever shown this in non-human primates, but we certainly haven't shown it yet in humans. If we can do that, I firmly believe that cellular persistence will translate into durable, complete responses, right?
We, in the BCMA's case, have to ensure we have a CAR which is as efficacious and potent as what the standard of care is today. We licensed a program from a company in China called IASO, expressly because the data are so compelling. You know, we have to always be careful. It's about an 80-patient study done in China, where there are some different characteristics of patients, but they have similar to what we've seen, you know, from the leaders in this field an over 90% MRD rate, you know, similar complete response rates. We don't have two-year efficacy data yet, but I think MRD, or minimal residual disease negativity, is the greatest predictor of durable responses. I think we're quite optimistic that we can get there with both, right?
Which is both a great CAR itself and really great cells that are hidden from the immune system. We'll see.
Right. Yeah, along those lines, you know, when you think about the, you know, CD19 and BCMA both as, you know, having approved therapies already out there today, is there a regulatory challenge, do you think? I mean, you're obviously not going to run a head-to-head study, but, you know, you're. You have to compare yourself to a standard of care that well accepted, you know, you know, KOLs and everyone, you know, everyone knows. Is there a special sort of hurdle that you have to kinda get over?
I'll start with in phase I, I don't see anything from a regulatory perspective, but I do see a risk that's come back to you. I think from a registration study perspective, I don't think we can honestly answer that question, right?
Yeah.
We're not there yet. The world could certainly change from where we are today.
Yeah.
I think we're in the middle of a double-edged sword as you're watching, for example, the CD19 space where you know we just had an approval in second line, and I think there might be a second one coming up shortly. That's a wonderful and big expansion of the potential market. I think it also makes it more complicated to enroll patients in a clinical study.
Yeah.
I think that will be something we have to work through without a question. It's what, you know, we need to really kind of have our operational chops in order. It's from a regulatory perspective, I don't think it's an issue.
Gotcha. Okay. Let's switch gears to the other programs that you have, you know, in preclinical for broad diseases, diabetes, CNS, cardiovascular programs. Give us kind of a sense of how you can match larger scale indications with some of the technologies.
Yeah.
that you feel the most enthusiastic for.
Certainly didn't set out to build a CAR- T company, right?
Right.
It's turned out that that's been a wonderful place, a great place for us to show, I think to really prove the platform and as you said earlier, hopefully make a big impact. But the goal of the company is much broader. I think that, you know, the next place that you can really see, you know, progress if we're successful in hiding cells in the immune system is type 1 diabetes. Type 1 diabetes, I think as people know, is very simplistically, the immune system has knocked out a single cell in the body, the beta cell, and we need to replace that, and we need to replace it in a way where two things are true. One, you have insulin, I should say glucose-sensitive insulin secretion, which is great.
Many cells in our body, pretty much anything else, trying to define exactly what you need is complicated, right? Like, what is a T-cell? What's a heart cell? What's a neuron? Actually, we know what we need here. We need glucose-sensitive insulin secretion. And the second, Well, so we need to hide things from the immune system, right? If we can see that, we'll be in a really great place. What have we learned? First off, we've shown now in non-human primates across multiple cell types that we can transplant cells in vivo, allogeneic cells with no immunosuppression, and these cells will engraft and live with no immune recognition. It's hard to, you know, overstate how excited our team was when they saw that. I think the second thing that we've tried to do is really understand.
There's allogeneic rejection of foreign cells, right? That's problem number one. Problem number two when you're going into this space is autoimmune rejection. The immune system that's already there and attacking beta cells. That's a harder one for us to test with animal models. But we've done it as best we can. We've taken human samples and, you know, exposed them to our cells. I think we have a lot of reason to believe that we can hide cells from autoimmune rejection. The third thing we need to show is that you can take stem cells and make them into beta cells at scale. I think Vertex did a wonderful thing for the field by first off showing that that's possible, right? In the setting of immunosuppression.
You know, we know that at least as we look at these cells, we can do it in a way that really works well, again, in animal models. The fourth is we now need to put together our GMP supply chain. That's really complicated, right? It's hard to understate the complexity of understanding genomic variability in stem cell-based products. There aren't great examples of companies. Many companies have made gene-edited stem cells that they then grow up. So it will take us some time. I think if things go well, this is when we file an IND next year. I think many people inside of our company would say this is the most valuable asset that we have by far.
You know, you know, it's one where, you know, you don't really have to worry about competition or things like that. I think the disease is such a problem that if we can get this right, we'll do something really important for patients.
Steve, from a regulatory perspective, you know, what do you see as the rate limiting step? What, you know, do you have to show sort of pre-clinically to give you more confidence in like a seamless path in an area like type 1 diabetes?
Well, I think that the question in the field as we've gotten to know more is how do you define an acceptable level of genomic heterogeneity in cells that you're, first of all, dividing multiple times and then differentiating. As you do that, your genome will wander a little bit, and you will have definite gene expression changes. We measure the genome, we measure gene expression, we measure epigenetic regulation in all of these cells and all the way through that. Understanding what is signal from noise, I think is really important. You have to do this at a scale that will allow you to attack relatively rare variants. Right? You're doing a lot of single-cell sequencing and interrogating these cells. That's the timeline. There's nothing.
Regulators don't know what to do with that information yet, just like we don't. I don't think this is more of a regulatory question as much as it is, us getting, you know, having a high bar and getting comfortable and then partnering with them. I would say whenever you're thinking through like an unknown, we try to divide into some simple things, define and limit the scope of the problem, so we're doing that. Be able to monitor inside the human if something goes awry, so making sure we have really good ability to catch things like if something did turn into something bad. Third is to be able to intervene and put in a suicide switch, something like that.
I think that because we have, you know, suicide switches and really great abilities to monitor, we'll be able to get ourselves comfortable with some unknowns here. I'd expect, just like what you've seen in CAR-Ts or in gene editing, that, you know, the regulatory bars were much broader than they are today, and regulators have tightened things as they've learned more. We'll start, you know, both of us from a stance of learning and, you know, the bars will get more challenging over time.
Yeah. I hear you, and I think from a regulatory perspective, if you look at, you know, some of the more orphan indications, say, you know, sickle cell. If you look at, you know, the hemophilia program, there's a lot of gene therapies that are in development today that are, you know, smaller indications and not large scale studies. But nobody is formally addressing the cardiovascular disease, type 2 diabetes. Do you think there'd be some flexibility into what you're assuming basically is the question as you move forward from phase I into a bigger.
I think sickle cell and hemophilia are pretty big diseases and compared to most things that we're doing. You know, one of the things I sometimes am frustrated with and what we've been able to accomplish as a field to date is that most of the diseases that we've been able to create, you know, really great medicines for are things that most of us haven't heard of. You know, I think one of our real challenges and a real challenge is to turn this into a field where we're affecting the diseases that most of our loved ones will suffer from. I don't think there's anything that, you know, regulators have against more prevalent diseases, right?
Right.
I do think as you get into less sick patient populations, your safety bar has to rise, right? You know, it's one of the questions that we always ask as we're going in with a new technology. Are the patients sick enough to justify the risk of the unknowns of a novel technology, right? I think that's a really important question to keep asking. I think where it comes in. You can't go forward and price a drug at a place that will bankrupt the system, right?
Therefore, it behooves us not only to learn how to manufacture things at scale as we're trying to tackle more prevalent diseases, but to do it at a cost that allows us to price in a way that society, you know, can both afford and probably wins, right? Society needs to win, not just the company.
Right. Yeah. If you look at the level of investment you've already made in the business, maybe talk about, you know, 'cause you're addressing some big questions, right? Do you want to do this alone over the long term? Like, what are the considerations that you could have for partnering with others that may offer something unique, right? Either capital or scale or expertise.
Yeah. A couple things. One, I don't think anybody in our industry has ever built a company with a sustainable R&D engine and globally launched their first product. I think companies who've launched their first product globally have relied upon M&A and licensing, and companies that have had wonderful pipelines have had to partner, in particular ex-U.S. Moderna may be the rule that proves the exception, right? I think we recognize that we have to partner globally to be successful. A lot of this has to do with just bandwidth. It's hard to build this, all these capabilities from scratch. You know, I always think that big companies should be little companies in every single attribute, except we can make faster and better decisions 'cause we're focused.
When I think about what's most important in a partnership, it's you would love to have big company resources and little company decision-making. Often you end up with big company decision-making and little company resources, right?
Right.
That's bleeding out value. I think the most important element for us is both capabilities that a partner brings and also you know decision-making and control. All those things are true. You know the other is you know none of us can live in a vacuum and not pay attention to the external markets. You know I think anybody who you know will have a very different view of their ability to finance their company alone today than they might have a couple of years ago. I you know I think capital is something that is in any development stage company has to be thinking pretty hard about and we certainly are as well. Those three things are true right?
We want decision-making, we want capabilities. A big part of that's ex-U.S., or global development and commercialization. You know, capital's scarcer than it was not that long ago. It's the reality we live in.
You still want to be, you know, on the offensive side of things, right? And if you see a newer technology or a newer, you know, skill set to, you know, to be on the lookout for bringing that in-house and, then the IASO deal is an example of that, right?
You'll see us do a few more things. Some things we've done and haven't disclosed that we will over time. Some things we will do around bringing in some different technologies, and we're definitely still looking. I would also say one of the more. You know, companies are always just like, I think, man, we're nature. We're battling with dying from starvation or indigestion. You know, given kind of the throughput right now in our pipeline, I think we run much more of a risk around indigestion than starvation. I don't think we can have the same voracious appetite we did at this, you know, a few years ago.
All that being said, you know, this is a field, cell and gene therapy, where the pace of innovation is so great that all of us run the risk of disintermediation, right? We have to be on the lookout for novel technologies in our core fields all the time and be ready to act.
Right.
It's a kind of a core part of what we built the company around. We are still investing in something we call SanaX, run by Richard Mulligan, which is an internal effort to kinda go off and create some of those novel next-generation technologies.
From a capital perspective, just kind of remind us of the cash after your successful IPO last year that you have and maybe some of the considerations as you start to hit critical mass, you know, from INDs this year and in the following.
You know, I would hate to be exactly wrong, but a little over $660 million or so as of what we reported yesterday. You know, it's plenty of cash to keep us going for a while. You know, we recognize we're a public company and probably always wanna keep 12-18 months at the minimum, right, in cash. We have enough of a runway to ensure that we can get, you know, understand what our drugs are in the clinic that are, you know, going forward later this year. You know, we'd always love to have a longer runway, as I think most would.
There's no doubt this company will need more capital over time, but we can play the hand out or at least understand the hand that we have. I don't think we played all that. We can understand our hand a bit better before we need to raise more cash.
Right.
Right.
Partnerships are not, at this point in the company evolution, probably not a great source of non-dilutive capital.
You know, I think that you never really know when a right great partner is gonna come around with something that makes a bunch of sense for both of us. You know, if you call us, we'll pick up the phone. We won't tell you to go away, but we also aren't, you know, making a bunch of outbound calls trying to find things.
Right. Gotcha. Perfect. All right. With that, we're out of time. Steve, thanks so much.
Thank you, Geoff, and thanks, everybody, for your time. Enjoy Vegas.