Good day, ladies and gentlemen, and welcome to the Sarepta Therapeutics First Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen only mode. As a reminder, today's program is being recorded. I'd now like to introduce your host for today's program, Ian Estapan, Senior Vice President, Chief of Staff And Corporate Affairs. Please go ahead.
Thank you, Valerie, and thank you all for joining today's call. Earlier today, we released our financial results for the first quarter of 2019. The press release is available on our website at www.sarepta dotcom and our 10 Q was filed with the SEC earlier this afternoon. Joining us on the call today are Doug Ingram, Andy Mahatme, Boatumbo, Gilmore O'Neal, and Louise Rodino Playpack. After our formal remarks, we'll open the call up for Q And A.
I'd like to note that during this call, we'll be making up both a number of forward looking statements. Please take a moment to review our slide and the webcast, which contains our forward looking statements. These forward looking statements involve risks and uncertainties, any of which are beyond directly controlled. Actual results could materially differ from these forward looking statements and any in such risks and materially and adversely affect the business, results of operations and trading prices throughout its common stock. For a detailed description of applicable risks and uncertainties,
we encourage you to review
the company's most recent quarterly report on Form 10 Q filed with the Securities And Exchange Commission as well as the company's other SEC filings. The company does not undertake any obligation to publicly update its forward looking statements including any financial projections provided today based on subsequent events or circumstances. With that, let me turn the call over to Doug Kingram, our CEO, who will provide an overview of our recent progress.
Doug? Thank you, Ian. Good afternoon, and thank you all for joining Sherpa Therapeutics on its 2019 first quarter results and corporate update conference call. In 20172018, We defined our ambition and then gathered the tools necessary to achieve that ambition. Our vision was audacious, but also very specific.
As a fully integrated commercial stage biotechnology company with a multi platform approach, we attend on being among the world leaders in precision genetic medicine. For our RNA platform, that means advancing our PMO technology to treat greater segments of the patient population with our exon skipping therapies, advancing our next generation PPMO technology, which is successful, could be a significantly more efficient version of our PMO technology. And bringing our RNA platform and expertise to new therapeutic diseases that could benefit from our steroid blocking technology. And for our gene therapy platform, it means building out our durable gene therapy model by focusing on 2 interrelated exercises. 1, advancing our multi therapeutic gene therapy engine already producing the broadest late stage gene therapy pipeline in biotech and 2, advancing our hybrid manufacturing model with the goal of having the most robust capacity available in gene therapy coupled with the ability to quickly transition constructs from proof of concept to commercial process supply.
The elements we built in 20172018 to fuel that vision are these. First, pipeline. Through internal development and external collaborations, we built what is currently a to none. That includes 11 gene therapy programs, 14 RNA programs and a gene editing collaboration. It also includes multiple therapeutic areas from Duchenne to 6 Limb girdle diseases to Charcot Marie Tooth MPS IIIA multiple additional CNS applications and the list goes on.
2nd, re sources. We entered 2019 with $1,200,000,000 in cash, and we raised another $375,000,000 in the first quarter to sure that we fuel our aspirations and we meet our very specific near term goals. And third, talent, When I joined Sarepta, we had about 200 employees. We have increased the number of employees against chemists, biologists, genetic experts, regulatory professionals, manufacturing experts and the like. By some 300 300% since then, and we are, in fact, tracking to about 850 employees by the end of this year.
Moreover, the sophistication of our talent is second to none, including our gene therapy center of excellence in Columbus, Ohio, headed by Doctor. Louise Rodino Klapac and our very talented Head of R&D, Doctor. Gilmore O'Neill. When one assesses our ability to achieve our goals, it should be done with reference to the tools that we have gathered, and that's assets a gene therapy manufacturing platform, our balance sheet and our talent. Now having gathered the tools to fuel our ambition, I noted at the inception of this year, that 2019 would be the year of execution as it is our goal to build our reputation, not only on the breadth of our ambition and the quality of our science.
But also on our operational excellence to drive performance and to execute. And I am very pleased to say that in the first quarter, Our team executed brilliantly. Let's start with our RNA franchise. In our 3rd year of launch, EXONDYS 51 continues to perform with sales standing at $87,000,000 and quarter over same quarter last year, growth of an impressive 35%. In early 2018, I represented that we would build a positive relationship with the FDA, and we would define an accelerated approval pathway for the bulk of our RNA platform.
I'm pleased to say that in first quarter of 2019, FDA accepted our next PMO therapy Golodirsen for filing, gave us priority review, set up a newFA date of August 19, 2019, and informed us that they do not intend to impact on an advisory committee at this time. In the first quarter of 2019, we announced positive results from our 3rd PMO candidate, and that's casimersen. If successful with Golodirsen and casimersen, we will have 3 therapies serving by the first quarter of 2020, representing nearly 30% of the Duchenne population and more than doubling the coverage that we have today. This is particularly impressive when one considers that in the entire history of biotech, there are less than 15 companies that have commercially launched 3 or more internally developed therapies. And we are progressing our next generation PPMO technology as well.
To remind you, our PPMO is a proprietary peptide conjugated version of our PMO RNA technology which in animal models has robustly increased cellular penetration, greatly enhancing exon skipping and dystrophin production. In the first quarter, we transitioned from our single ascending dose study to our multi ascending dose study for our first of 6 candidates SRP-five thousand and fifty one. We have screened our first patient in the study and we should have insight on dosing levels by the end of 2019 to first quarter of 2020. Moving next to our gene therapy franchise, we have made very significant progress in the first quarter. Having fulfilled our commitment to commence our placebo controlled microdystrophin gene therapy trial By the fourth quarter of 2018, we have now made great progress on enrollment, having now dosed 18 patients thus far we are comfortably on track to complete all dosing of the trial in this quarter, the second quarter of 2019.
And we are on track to commence a multi center trial with commercial supply by year end. In the first quarter, we also announced very positive results our first cohort of Limb girdle 2e. That's our first program. Mean protein positive fibers was 51%, some 250% of the predefined milestone of success of 20% in the study. Mean intensity was an impressive 47% and Western blot quantification was a mean 36%.
Creatine kinase enzyme, the marker of muscle damage, dropped by an unprecedented 90%. These results are particularly telling since they come in a quarter of the dose of our micro dystrophin program. Given the lack of expression of another recent neuromuscular program in the space in five times E to the 13th. These results suggest the elegant design of our construct with potential positive read through to all of the other limb girdle programs in our pipeline and also back to our micro dystrophin gene therapy construct which not only shares the same vector and promoter, but the same designer Doctor. Louise Rodino Klapac.
Commercial process supplied for the Limb Girdle 2E pivotal trial will be available in the first half of twenty twenty. We have decided to use the available time to dose escalate with clinical supply from the Nationwide Children's facility. We plan to dose 3 patients in cohort 2 at 2e14th. This strategy will inform the dosing regimen Not only for the 2E pivotal study, but it should also inform us selection for all 6 of the limb girdle programs. We have planned to initiate dosing in this cohort in the middle of this year.
Going on, as we announced earlier today, we continue to build out our gene Therapy Engine, this time with an additional partnership with Nationwide Children's Hospital and Doctor. Zarife Sahenk for our 6 Limb girdle therapy Limb girdle 2a otherwise known as Calpainopathy. We are excited to deepen our relationship with Doctor. Sahenk, the inventor of and the principal investigator for our Charcot Marie Tooth program. And we are pleased to add a gene therapy treatment for Calpainopathy to our pipeline.
Calpainopathy is an autosomal recess lingrural disease that results in very serious muscle degeneration and wasting. It is also the most prevalent form of limb girdle accounting for about 30% of all in girdle muscular dystrophy. Doctor. Sahenk's approach relies on R874, and elegantly replaces the missing native protein from the calcane 3 gene, the root cause of the disease. Going on, with our partner Lysogene, in the first quarter, we commenced dosing in our Phase IIIII gene therapy program to treat MPS 3a also known as sanfilippo disease, a devastating neurological disease that often robs the life of children before the age of fifteen.
In the first quarter, we also made great strides toward the build out of our gene therapy manufacturing plan. We are near completion of our process development and yield optimization efforts and have advanced our analytical development for micro dystrophin commercial process. Our goal is to complete all process analytical development and to be in a position to commence our commercial process supply trial by year end. As many of you know, 2 of our CMOs were recently acquired in multibillion dollar transactions. Both of their investments further validate Sarepta's programs, and our approach to manufacturing in so far as we are the most significant long term customer of both Brammer and Paragon.
Our hybrid manufacturing approach is a purposeful strategy designed to allow us control of the most differentiated the aspects of the manufacturing process, while affording us the speed, the scale and the risk mitigation to match our goal of rapidly safety and efficacy of our first program and bringing it to the community. Our strategy includes building internal talent and ability around high value, differentiated process development and analytical development in early stage manufacturing and entering into long term partnerships from large scale supply. The goal then is to control the high the highly differentiated parts of manufacturers, those that will allow us to move rapidly conception and commercialization. And to partner and outsource those portions that will become the commoditized aspects. Of manufacturing.
Towards that end, we are near completion of a seventy five thousand square foot dedicated Sarepta gene therapy manufacturing facility with Brammer Biosciences and its parent Thermo Fisher in Lexington, Massachusetts targeted for commercial manufacturing beginning in late 2019 this very year. We also have dedicated supply with Paragon, and as recently announced by Paragon and its parent Cavalent, we are in discussions for a deeper commercial supply relationship, including a second dedicated site for Sarepta supply. We set very ambitious targets for ourselves for 2019. And I am proud to say that the Sarepta team has so far in 2019 executed well against those targets. And yet again, we must remind ourselves that there is much left to be done in 2019 an enormous number of important milestones and inflection points left to achieve.
We will complete dosing of our placebo trial for micro dystrophin in 2019. We will dose additional limb girdle patients in 2019. We will report out on progress of our first 2E cohort of patients later this year at a medical meeting or a scientific conference. We will continue the dosing of our trial for MPS IIIA or sanfilippo disease. We will commence dosing of our first Charcot Marie Tooth gene therapy.
Cholar. We intend to obtain our 2nd PMO approval this time for golodirsen and to launch golodirsen, in 2019. We expect to submit an NDA for casimersen in 2019. We will execute our multi ascending trial for our next generation PPMO in 2019. We intend to complete our process development, build commercial supply for micro dystrophin and commence our commercial supply trial before the end of this year of 2019.
And we will very likely find additional attractive assets to fuel our gene therapy engine this year. The remainder of 2019 will be busy, but it will certainly be consequential. If we achieve our goals, we will profoundly improve the lives of countless patients living with and otherwise dying very young from rare disease. We will build an enduring genetic medicine powerhouse designed to live all of us. And we will certainly create enormous shareholder value.
And with that, I will turn the call over to Sandy Mahatni to provide an update on the financials.
Chedi? Thanks, Doug. Good afternoon, everyone. We are pleased with our financial performance for the first quarter of 2019. Some of the highlights include $87,000,000 of net product revenue, flat operating expenses compared to the prior quarter and approximately $1,400,000,000 in cash, cash equivalents and investments on hand as of March 31, 2019.
Continue to see attractive opportunities to expand our portfolio of products, leveraging our business development expertise to accelerate this expansion and augment our progress
in internal research. This is
further evidenced by this morning's announcement around our agreement with Nationwide Children's Hospital that added a candidate or lingered muscular dystrophy type 2a to our pipeline. We feel that with the capabilities and expertise we have internally, the directed nature of genetically targeted therapies, we can identify programs that have a high probability of success that we have the expertise to efficiently move through clinical development and thus fit into our commercial portfolio. Our recent Limb girdle muscular dystrophy 2E clinical results provide additional support for the strategic path that we are on. Solidify our position as a leading gene therapy company. This agreement brings our pipeline to 26 products and development, 11 of which are in gene therapy.
We expect to continue our current pace of expansion, maintaining a selective approach around both the science and financial metrics. Investments in developing our pipeline will grow in 2019 as we continue to add programs and advance programs from smaller early stage trials into late stage development. We will also continue to invest in our Gene Therapy Center of Excellence in order to internally identify new targets for development. The expansion of our pipeline must be fully supported by investments in manufacturing capacity. Shortly after Q1, we secured the remaining suites at Brammer Bio and as a result, their site in Lexington, Massachusetts is not fully dedicated to Sarepta's DMD Therapy programs.
We also purchased more Isolation units at Paragon to build additional capacity for commercial supply in anticipation of commercial launches of both our plan and invest in our business. We maintain a very strong balance sheet, which allows us not only to invest appropriately in our current pipeline, but also to secure opportunities such as a limb girdle muscular dystrophy 2a agreement that have a higher probability of success than traditional business development deals. Now moving to the financials. This afternoon's press release provided details for the first quarter of 2019 on a non GAAP basis as well as a GAAP basis. The press release is available on Sarepta's website.
Please refer to our press release for a full reconciliation of GAAP to non GAAP. I'd like to add a quick reminder here that our 2019 non GAAP financials exclude net interest expense, depreciation and amortization expense, well as one time expenses and stock based compensation. Net product revenue for the first quarter of 2019 was 87,000,000 compared to $64,600,000 for the same period of 2018. The increase primarily reflects increasing demand for EXONDYS 50x-fifty one in the United States. We reported a non GAAP net loss of $53,800,000 or $0.75 per share, the first quarter of 2019 compared to a non GAAP net loss of $17,900,000 or $0.28 per share in the first quarter of 2018.
The first quarter of 2019, we recorded approximately $12,100,000 in cost of sales compared to $5,600,000 in the same period of 2018. The increase was driven by higher inventory costs and royalty payments to BioMarin primarily related to Q1 in 2018 and into 2019. On a GAAP basis, we recorded $90,000,000 or $46,200,000 of R and D expense for the first quarter of 2019 2018, respectively, which is a year over year increase of $44,400,000 The year over year growth in GAAP R and D expenses was driven largely by increased manufacturing activities related to gene therapy increased patient enrollment in our early and late stage clinical trials as well as higher employee related costs due to significant hiring in 2018 and into 2019. On a non GAAP basis, the R and D expenses were $81,400,000 to the first quarter 2019 compared to $43,300,000 for the same period of 2017, an increase of $38,100,000. Turning to SG and A, on a GAAP basis, we recorded $60,600,000 $43,300,000 of expense the first quarter of 2019 2018, respectively, a year over year increase of $17,300,000.
On a non GAAP basis, the SG and A expenses were $47,800,000 for the first quarter of 2019 compared to $33,700,000 for the same period of 2018, an increase of $14,100,000. The year over year increase was primarily driven by continued expansion to support our commercial launch plans globally, and 20 therapies in various stages of development across therapeutic modalities. On a GAAP basis, we recorded $200,000 in net interest expense for the first quarter of 2019 compared to $4,500,000 of net interest expense for the same period of 2018. The decrease in interest expense is primarily driven by payoff of certain debt instruments during the fourth quarter of 2018 as well as high return on investments over the first quarter of 2019. We ended Q1 with approximately $1,400,000,000 in cash cash equivalents and other investments.
This was an increase of $175,000,000 in our cash position from the prior quarter was driven primarily by the equity raise of $365,000,000 of net cash offset by $54,000,000 related to manufacturing initiatives and other net cash from operations. With that, I'd like to turn the call over to Bo for a
commercial update. Bo? Thank you, Sandy. Good afternoon, everyone. As you can see from our revenue of $87,000,000 for Q1 of 2019, physicians continue to be committed to helping patients start and stay on EXONDYS 51.
Duchenne patients the Duchenne community continue to be the core of who we are and what we do. Our work will not be complete, and we will not rest until we've helped the broadest number of Duchenne patients in the quickest amount of time, providing a clear path to access for these potential life changing treatments. We continue to focus on genetic testing As you know, we have with PPND many years ago, which focuses on the U. S. Patient populations.
Since then, decode Duchenne has genotypes more than 1000 DMD patients. And as a result, patients got into care or on a treatment or entered into clinical trials We've now started supporting genetic testing in other areas around the world, and we'll continue to bolster opportunities to help the community by supporting genetic testing in certain regions. Rounding out our RNA franchise are 2 other chemo based therapies for Duchenne currently in development in golodirsen and casimersen. As Doug mentioned, the FDA granted golodirsen priority review status with a PDUFA date of August 19, 2019. In response, we will be will be tailored to reaching those individuals in the Duchenne community, who are exon 53 skip amenable.
We will leverage our knowledge and expertise in EXONDYS 51 to assist patients accessing this medication as fast as possible. Sarepta's commercial and medical teams are prepared for the potential approval of golodirsen. We remain on track to submit our NDA for casimersen in 2019, with a target approval in the first quarter of 2020. If approved, Kathimersen will serve approximately another 8% of the Duchenne community. With that said, our goal by early 2020 is to have 3 approved drugs born out of our RNA platform for individuals living with Duchenne.
While the majority of the commercial and medical teams are focused on EXONDYS 51 and ready for the potential launch of Bill Rederson, We have already begun planning for a successful launch with micro dystrophin.
As part
of that plan, we've already begun to build out our core microdystrophin launch team and are preparing for commercial site readiness to ensure multiple clinics Not only in the U. S, but globally, can identify and treat patients safely with our microdystrophin gene therapy if approved. While the core of the As Doug mentioned, we're excited about the addition of our limb girdle 2a program. Based on our market research, limb girdle muscular dystrophy 2a has the highest frequency in the United States, Europe and Brazil. We're excited to have this opportunity to partner with a new community where there's such a high unmet need.
In support of the immense opportunity for us, we've started meeting with the leading KOLs around the world to have a deeper understanding of the Limb girdle muscular dystrophy disease safe. We will continue our educational initiatives at Global Congress to build a foundation of knowledge on how vectors, promoters and RNA chemistries fit into various disease states. In the coming quarters, we will report on the progress we've made on these initiatives. In addition, We have recently hired genetic testing professionals who have a background in rare disease and will focus on our 6 limb girdle muscular dystrophy programs, as well as our many other gene therapy programs, such as MPS IIIA and a few other programs yet to be named. We're also thoughtfully building out our global infrastructure to enable us to launch RNA therapies if we have approvals in other regions.
Or prepare for potential launch, global launch in the coming years with our micro dystrophin and Limb girdle muscular dystrophy programs. With the hope of gene therapies before us, we must ensure access and reimbursement is top of mind There are structural hurdles to access and reimbursement of a single dose transformative gene therapy, And as a leader in genetic medicine, Sarepta is working to play a leading role in resolving those hurdles. So that if our We do not believe that prove and extend the life of those with devastating rare genetic disease, even the most conservative cost effectiveness models, will support a multimillion dollar proposition. Isor itself has noted Health Technology Assessment models can often justify prices for gene therapy in the $20,000,000 to $25,000,000 range. Far above the actual price that an innovator would actually charge for therapy, which means the vast share of value will benefit society and patients.
A good example of this are the recent statements by Novartis, that is SMA gene therapy Zolgensma. Is cost effective at a price of $4,000,000 far from the issue of price. The fundamental issue is the structural impediments that come from the unintended consequences of a healthcare reimbursement system that has for many decades been built around chronic symptomatic therapies. Sarepta has been in detailed engagement with private and governmental payers to find solutions that would provide early access to waiting patients provide to the innovators the value that justify investment in gene therapy and that ensures that payers, both public and private, can absorb the cost of a transformative therapy without overwhelming the system. For Sarepta, no solution is off the table.
We are exploring payments over time, risk based contracting so that Sarepta shares in the outcome and durability risk with payers, subscription models that can provide payers with more certainty and flat or per patient pricing over weight based pricing. We're also working those who are focused on legislative changes that would allow states and private payers to negotiate these sort of access empowering relationships. And are beginning the process of working with CMS and take Medicaid to ensure that our therapies are equally available to private and Medicaid patients. We have created a dynamic internal team government affairs, national accounts, distribution professionals and other key functions to collaborate with healthcare, healthcare leaders and stakeholder groups. To work together and truly address new models for reimbursement.
Sarepta has already initiated multiple exec to exec meetings with major commercial and Medicaid health care leaders in addition to influential stakeholders within the federal government or leading reimbursement working groups around the country. To date, we've already held numerous meetings with key decision makers to help inform a path forward so that the promise of gene therapies and new models around pricing and reimbursement can be realized. Sarepta fully appreciates this goal in this conversation and that if we are to remain true to our mission of placing human health central to all that we do, Then we must, as innovators and drug developers come to the table with not only solutions and ideas, but actual plans to execute on. We appreciate all the payers and thought leaders who are already engaging and partnering with us on these efforts. We look forward to finding a solution together.
Our mission is to be the global leader in precision genetic medicine, and all it all started with EXONDYS 51. We have broadly expanded our pipelines to potentially treat tens of thousands of patients in need and could have patients being dosed with gene therapies in Duchenne, limb girdle muscular dystrophy, MPS IIIA and Charcot Marie Tooth, as well as have 2 approved RNA therapies for Duchenne in the coming quarters. This is truly an exciting time for all patients living with rare and debilitating diseases. All of us have wrapped up look forward to the future of precision genetic medicine. I will now turn the call back over to Doug.
Thank you, Beau.
Our first question comes from Althea Young of Cantor Fitzgerald. Your line is open.
Hey, thanks for taking my question guys. I was just curious in light of the Pfizer data readout and obviously you guys have a lot of experience with gene therapy. Can you talk about maybe potentially what you might expect to see with this data set at the current dose they're at And just any other kind of observations from being an MDA, just around the competitive landscape would be helpful as well. Thanks.
Okay. Thank you for that question, Alethia. So a couple of things. Just to bring everyone up to speed, it's our understanding now that Advisor has confirmed that it is going to do a data release at a patient advocacy conference in late June of this year. At the PPMD conference.
I believe it's down in Orlando. So a couple of things. First, of course, we're very interested in seeing the data because we can't obviously speculate on what that data will look like in advance of the meeting, but we look forward to seeing it. We'll obviously be there. There are a couple things, however, to consider as we wait for and review that data.
So first of all, I think based on where we are in development, and our Pfizer's most recent public statements, we are in the lead on development. Our best guess is we're at stands right now about a year ahead of Pfizer in our development program. I would remind you that we will be done dosing our placebo trial this quarter. Obviously, that could change, but as it stands now, I think we're about a year ahead of Pfizer. And there are some other things to consider as we consider what we'll see at PPMD.
1st, to evaluate the results, I think it's important to consider their dose. So just so everyone understands, we use different titers. So comparing dose requires some mathematical adjustment between us. Sarepta uses suprcoiled QPCR. And we understand they use something that's called linearized QPCR.
And you have to do a conversion. And that conversion between those 2 titers based on our analysis is about 2 to 1. That means that on an apples to apples basis, Pfizer's current dose is about 300% of our current dose, about 300%. There is a truly staggering dose and an enormous viral vector burden for the patient. So when one eventually sees their expression data, you will need to judge that expression data against the viral burden to which the patients are being subjected.
Subjected. And that does implicate safety, not merely in those first three patients, but also in patients across the entire spectrum of the disease, ages, weights and the like. Obviously, we take no position on their dose selection, as we are not privy to their preclinical data or otherwise. But one would assume that in light of their dose selection, they will need to show a very impressive, concomitant expression benefit to remain competitive. In fact, at 300% or so of our dose, if they are unable to show expression levels that are greater than our expression, It raises at least the question whether they have a viable program from a risk benefit perspective.
But we'll see what they have when we see them in June. And there is one other thing. It'll be interesting to see how they quantify dystrophin. As you will recall, Sarepta was very transparent when we announced our data last year. First, of course, we provided quantification of dystrophin using Western Block.
Western Blot has been the gold standard and he only measured at the FDA as he had accepted as a basis of approval for a dystrophin producing therapy. And second, we used immunohistochemistry. We did both dystrophin positive fibers and we did intensity. And we went so far as actually is to show images. We not only showed is for the immunohistochemistry actually showed images as well for Western blot.
So you can see we were essentially doing our math for you. This is extremely important immunohistochemistry because all of the literature for now decades on Duchenne has been done on immunohistochemistry and disciplined positive fibers and intensity. So judging expression without IHC would be impossible. It would be impossible to make meaning of data. And third, you'll know, we provided genome copies for nucleus, a very important metric for gene therapy coverage and transduction.
Now so we're clear Pfizer is a credible company. And so they should, and we will assume they will transparently provide Western blot district and positive fiber intensity and genome copy data for their data release as they clearly should have this data. We know that they also looked at an experiment. They're looking now, I believe, at an experimental new measure using mass spec. They had never been used before, but this cannot possibly take the place of the measures that allow for a meaningful analysis and a comparison of expression with reference to the great body of literature and prior trials in the life, all of which rely on western blot and immunohistochemistry.
Transparency demands Western blot, dystrophin positive fiber data, it tends to be bad at genome copies. And the level of this transparency will become extremely important for a number of reasons. Obviously, it'll be impossible for an investor and analyst or a physician to make any meeting of their data in the absence of these measures. But there's something far more important than this. And that is an issue of patients.
Gene therapy is unique. It has a particularly unforgiving treatment in a sense because it has unique bioethical considerations. If a patient is given a gene therapy, they will likely be unable to get any other gene therapy literally for the rest of their lives unless the science on that changes. Patients choosing to participate in clinical trials and their physicians deserve accurate information that can inform that decision maker. Now we're going to assume that Pfizer knows and understands this and will do the right thing.
We have no reason to believe they won't. But given that Pfizer has chosen to make his data disclosure at a Duchenne patient conference, it would be particularly unconscionable for them to hide western blot IAC data and we will that will not occur. So I think we don't know the data. It'll be very interesting to see it in June. When we review the data, as everyone says, we can review it in the context that they're dosing And we'll certainly like to take a careful look at their western blot data, varying in his detention data, dystrophin positive fibers and intensities of we can make meaning of the data that we see in Orlando.
Our next question comes from Tuberl of Cowen. Your line is open.
Hey guys, thanks for taking the question. Question for Bo. You mentioned that you're putting together your strategy for the micro dystrophin gene therapy even now What are your high level thoughts on treating the prevalent population? How are you looking at the low hanging fruit, age wise, mutation wise, baseline function wise, what percentage of that prevalent population is an ideal candidate out of the gate, especially with how you're thinking about pricing?
Well, I mean currently we think that the entire population based off the clinical trial design that Gilmore and the team is putting through will be eligible. So if there's is not a low hanging fruit. I think what we're going to find is there's going to be a mad rush coming in. Matterback, when you start talking to physicians, And Doug sort of mentioned this on clinical trial improvements about how patients are literally trying to bang down the doors to get in. If you start thinking about clinical, I mean, commercial readiness.
The physicians are telling me that patients are already lining up. They're already trying to identify whether they're going to be eligible or not. So really it's about site readiness, making sure that we have enough sites that can dose the drug immediately after approval, making sure that they are up to speed and safely, administer the therapy in a very quick time. I think the biggest thing that I want to do beforehand is work on access and reimbursement, making sure in sort of the incentive and speech making sure that the system is ready for these once in a lifetime transformative therapies, and that we can get to to the patients as fast as possible. So I'm putting a lot of emphasis on access reimbursement and site readiness over the next couple of years.
This will be globally, especially not only in the U. S, but some of our large markets, such as Brazil, Germany, etcetera.
Thank you. Our next question comes from Ryan Abrams with RBC Capital Markets. Your line is open.
A question on limb girdle 2E program. Can you talk about how you chose how you selected the dose that you're going to be moving to Will you be doing any additional monitoring or supportive treatment to monitor for LFTs and manage LFT elevations?
Then can you talk about the
type of patients that you're going to include in this next cohort? Should we assume these new patients with the more severe phenotypes, mutations at exon 34 just to enable the most apt comparison to the low dose? Thanks.
I will turn the question to Doctor. Luis Rodino Vipa.
Sure. The dose selected was based on our non clinical data and it was predefined in the protocol already for dose escalation. We will the enrolling a population as in the same first cohort of 4 to 15 years of age. For continuity between them. And I think there was one more question.
Sorry.
I think Exxon's including investments to make sure that there's an
apples to make sure that there's an apples to represents the majority of the population, any way between these exonzo-three, the COM-three twenty six.
And the one thing I'll just remind is that that we're in a luxury position in one sense. We've seen great results thus far with our 1st cohort But to get to commercial supply, which we will need to do to our pathway to, getting to the community, we have some time work over paragon working on that as we speak. And so we should dose escalate during this period of time and test a higher dose. See if that higher dose provides a better benefit to safety, perspective that are current. But the good news is we're already sitting in a really good position to remind us on, protein positive fibers, we were at 51%, which is, 2.5 times higher than what the predefined level of success was for the trial.
So we're already in a good position and now we have a luxury of those escalating without having to worry about any kind of delay.
I think there's other parts of the question as well. I mean, this is Gilmore here speaking had asked also about monitoring liver functions. And we are obviously keeping a close eye on that, is our working hypothesis now. And I think supported by the data we've seen to date that these liver enzyme changes are amenable to prednisone management, and we are continuously updating and amending and adjusting or optimizing our, steroid regime. So we will be keeping full time on that, but, our hypothesis is that we will be able to control that well with steroid use during that initial dosing period.
Thank you. Our next question comes from Tazeen Ahmad, Bank of America. Your line is open.
Hi, good afternoon. Thanks for taking my question. I'm wondering if you could give us a little bit more color on LGMD2A. How does that compare pathologically to the other subtypes that you've studied. And, being that you're adding, presumably, you've mentioned the 30% of LGMD patients?
How does that change any manufacturing constraints for Paragon? Thanks.
Well, we're in the couple of thoughts, and I really should turn this over to Doctor. Rudi and I'll let, I've gotten a good primer on it. So you're at serious risk of me just answering the question. All right. So, under the manufacturing issue, first, we really are in the process of Gantt charting out the pathway from a manufacturing and clinical program perspective across all of these limb girdle programs, which you're right.
We now have 6 Limb girdle programs and little to no competition here, notwithstanding the fact that we have little to no addition, we need to move with enormous sense of urgency to bring these therapies forward. We're really excited about QA. I think we mentioned earlier, This is about 25% or 30% of the Limb girdle community. That means that we are just about there's some error bars around this, but probably 70% maybe higher than 70%, maybe even 80% of the Limb girdle patient population that could be served by our 6 programs. And then as Luis will tell you about that, obviously given the largest one, this presents itself a little later because it relates to, essentially an issue associated with the inability to properly repair muscle as it gets damaged as opposed to what things like, our beta sarcoglycan does, like our micro dystrophin program does.
But with that said, I'll turn this over to Louise to answer it properly.
I think Doug set it up well. If you think about our Limb girdle programs, they roughly fall into 2 buckets, which is the sarcoglycan and, as well as now Calpain fits in quite nicely with our Dysferlin and Noximin-five program. Just thinking about the mechanism of action of these important proteins, calpain, as well as Dysferlin and anoctin fiber involved in the repair regeneration process and muscle. That's generally why you see a slightly later onset in the mid teens for these. So as far as the mechanism, over time, you just lose that regenerative capacity and that leads to this really devastating disease.
As far as read through or using same rh74 vectors. We are for the other 5 programs. We're using the same promoter, the TMCK promoter that we're using in 2 of our other programs. As lgmt2D and lgmt2L or Noximod5. So there's been a lot of shared learnings.
We've obviously had a collaborative with doctors to Hank over the years and there was shared development of these programs. So we're really excited to be continuing to work with the Per and move these programs forward.
Our next question comes from Matthew Harrison of Morgan Stanley. Your line is open.
Hi, this is Maxwell Skor on for Matthew Harrison. Just a quick question on the progress you're making on manufacturing. I believe you've executed tech from Nationwide, but have you started to produce vector at any of Brammer's facilities? And can you comment on how many lots you'll need to produce of GMP vector? Thank you.
So I'll give you the this is Tom. I'll give you the broad strokes, but thank you for asking about manufacturing. It gives me an opportunity to mention something that I had intended to mention in the opening. I didn't. I would like to brag a little bit about what we're the people at Sarepta, I mentioned that we have Doctor.
Louise Rodino Klapac and dot or Gilmore O'Neal, and we've got a great folks. But as you think about our hybrid model, it's going to be talking about that. One of the things we're doing is gathering to gather X Sarepta expertise around process development and analytical development and early GMP Manufacturing because that is going to allow us to hold all of this brexiating aspects of manufacturing and also as we keep bringing in assets to move them rapidly through the preclinical to the clinical stage to the commercial stage I'm really proud in relation to that to talk about, Doctor. Reed Clark. Doctor.
Reed Clark is now a Sarepta employee. Is a pioneer in the field of process development and AAV biology. He actually is the person that developed nationwide children's hospitals, III process. And he actually collaborated with Doctor. Louise Rodino Klapac on early development of the micro dystrophin and limb girdle programs every time I mention his name, Luis Smiles, so I know it's positive.
We're building under Doctor. Doctor. Clark a formidable team focused on process and analytical development. And just so we understand what that all means, by the end of 2019, we will have 200 employees dedicated to manufacturing at Sarepta, that's manufacturing process development and analytical development technical quality control of all the insurance, regulatory CMC operations, we have folks in Cambridge and Burlington. We have a 38 acre facility in Andover that we own.
And of course, we have our gene therapy center of excellence and some manufacturers out in Columbus, Ohio. And we'll be spending $600,000,000 to $650,000,000 on manufacturing in just the next 15 months or so to make sure that we're ready fully service community. And now where are we with micro dystrophin? Yes, we certainly have some time ago tech transferred over to the Brammer facility from the, from Nationwide Children's Hospital. And as we stand right now, in the broadest of strokes, we are in the latter stages of process development we are just about done on yield optimization and we are deeply in analytical development.
There's going to be a lot of assay work that has to get done in the next couple of months, but we are deep in that as well. And we are very fortunate to have Doctor. Reed Clark on top of that as well. So we're in good shape right now. We have done runs.
I'm not going to give you a number of products, but we have done runs. We have my sellers units up and running. We've done early runs, and we've got good data from that. And we're tracking. And our goal now, there's a lot of work to be done, but we are on track as it stands today.
To meet our goal. Our goal is to have our next commercial supply trial fully vetted with the agency and then our commercial process fully vetting with the agency and to commence our commercial supply trial before the end of 2019. Thank you.
Our next question comes from Debjit Chattopay of H. C. Wainwright. Your line is open.
Hey, good afternoon. So given the price point that you mentioned and the reappears are alluding to, how are you thinking about non ambulant patients, especially in the commercial supply study in the microdiscipline program. Also have you had any additional dialogue with the agency regarding the design for that study?
We have not had direct discussions, further discussions with the agency on the design. Obviously, we're tracking to do that in the near term. We will be burdening the agency with a lot of discussions across our programs over the course of 2019. That will be one of the The short answer on non ambulatory patients is that there is no way that Sarepta is leaving them behind this remind us of where we are, the vector that we have, not only robustly, expresses in skeletal muscle and cardiac muscle, it actually over expresses by about 120% in cardiac muscle, which means that there should be no child our young adult, who is beyond the ability beyond the place where our micro dystrophin program, if it is successful, would help them and benefit them and extend and improve their lives. So we don't want to leave them behind, and we will ensure that the design of our next their or next trial includes sufficient focus on older and non ambulatory patients that we will not only get a label for that, which of course is our big goal.
But also puts us in a place where we can get to the fullest extent possible rapid access post approval from payers.
So just have a follow-up on the PPMO program. Again, given the investments that we are seeing from peers, how important is this PPMA program to the overall franchise, especially focused on rescuing the non ambulant patients? And thank you so much
Yes, thank you. Well, we're very excited about the PPMO program. We don't we try not to talk a lot about it because we don't want to pump it right now. We're in the middle of a multi dose. We've had a very successful single ascending dose trial.
We're starting our multi ascending dose at 4 gigs per kid. We need to get a lot higher. We'd like to get a lot higher than that. One of the things we know when we're in the PPO is just to remind people, I'll remind people once again to this extent that people are otherwise unaware. PPMO program, which is our RNA therapy, it is the same backup as PMO.
We've conjugated a peptide that allows Number 1, the molecule then becomes positively charged. It allows much greater penetration into the cell. And in preclinical models, if we can get up to high enough doses, we can see as much as an order of magnitude or expression and therefore more benefit than our PMO technology. So we're really focused on that. And so it is a very big part of our thesis.
It's a big part of our thesis for, for patients with Duchenne muscular dystrophy, both frankly ambulatory ethyl ambulatory patients. And it will be an important part of our platform going forward beyond Duchenne muscular One of the things that Doctor. O'Neil and his team and research are working on is target selection, both from our PMO or PMO plus and our our PPMO programs that target selection beyond Duchenne in areas where, our RNA technology would make brilliant sense sometimes even sometimes in ways that draft gene therapy couldn't actually address places where, for instance, the gene is so large. It's not easily packaged in AAV and the like. So the PDMO program is important.
We're tracking to get inside by the end of this year and then the first quarter of next year. Have 6 constructs in the PPMO program that cover about 43% of the Duchenne community, and we'll certainly provide additional update on that. At the end of this year, early into 2020. Thank
you. Our next question comes from Christopher Marai of Nomura. Your line is open.
Hey, good afternoon. Thanks for taking the question. Just regarding your Limb girdle 2a program, wondering if you could further elaborate on how you might be testing that in the clinic. It looks like patients with this disease express normal levels of the protein, if I'm not mistaken. And I guess there's another option perhaps to measure something like proteolytic activity.
How do you look to, I guess, to study this this gene therapy relative to the others as it seemed a little bit different? Thank you.
I would although I'm dying to answer the questions. There's a person that were much better than me at this, and I'll let Doctor.
Thing I just want to clarify, there's a variety of mutations that you can have complete lots of functions, but you can also file the mutations. That's your point. Do lead to normal levels of calpain, but is non functional. This is an enzyme with kind of like activities. To your point, measurements of the Gene that we're transferring the wild type version of the proteins will be important.
So that will be part of our development plan is to make sure that we are accurately measuring, not only the quantity of the protein, but then we're, the wild type version that we are delivering.
And we will be this is Gilmore. We are mapping that out and we will actually be working on the design of these teams and programs and refining them in parallel with the non clinical work
that we're undertaking right now. But in some ways, this might, although on the face of
it, one might look at
this and try to compare it, for instance, the dystrophin expression. I wonder if you if that's the way to look at it, maybe this will be challenging to deduce success, but this actually might be easier in some ways because enzymatic activity might very well. Show that there's a very strong direct correlation between proteolytic enzymatic activity and phenotypes. So actually, in many ways, it may be more relevant. Maybe, but
I think the key point that Luis has made also is what that is the fact that it is not universally a expressed. The only permutation associated with, a high level of protein expression for others, which are associated with an absolute lump. So let me clear that that nuance is correctly understood. Thank you.
Our next question comes from Martin Auster of Credit Suisse. Your line is open.
Hi, this is Mark on
for Marty. Thanks for taking my question and congratulations on the progress. So with Novartis gene therapy is expected to be approved this month at which time we would expect the company to announce its pricing scheme. With payers you talk to, do they see your DMD gene therapy in a similar light as SMA gene therapy in terms of potential value to patients? And how should we think about potential read through from Zolgensma pricing?
Thank you.
We'll wait to see it before we can really comment on it. Obviously, we're doing a lot of work. We haven't given precise information externally on where we're looking at the pricing initiative. We're building up significantly with structural issues. Think one of the things you hear, if you wouldn't have been survey on payers right now, you'll hear a lot of the, a lot of payers talking very positively about Sarepta and its program in a couple of ways.
1, they'll just, I think you'll hear from people because you can do a poll, you know, a Google search and I think you'll find people saying positive things about our proactive outreach. We have, I think, more aggressively than most companies in gene therapy have been reaching out to payers and to begin to begin a dialogue about the structural And I think they're also well aware of the early results that we've seen with our program. And many of them have made the point that we have to find solutions together to ensure that patients get access and they see the value here. So I do think I think if we don't really go into depth and be able to compare and contrast with other programs, but I suspect that they're probably excited about SMA as well. For a host of reasons, I think there may be reasons why our, pricing model might be different than SMA kids, which are smaller.
Smaller kids, either the younger age than our program. But we're going to wait and see what Novartis does and then we'll We'll come back at a later date, talk more about some of the structural issues and the work will go and his team are joining there. And then we'll also at some point start talking about the pricing issues, but we're a little premature on that right now.
Thank you. Our next question comes from Gena Wang of Barclays. Your line is open.
Thank you for taking my questions. I will follow Alicia's question regarding the Pfizer data. I know Doug you comment a lot on the biomarker data. Just wondering what would be your thoughts on the NeuroStar data. I know we all know they are patient slightly older than your patient.
How how would that data read through to your program? And a quick follow-up question regarding the micro dystrophin gene therapy 102 study. For the 3 months biopsy data, which if you complete enrollment in second quarter, then it should be ready by 4Q. So I know it is a placebo controlled study, double blind, but wondering would you be able to see the data what would be the earliest time you would be able to see the data?
Well, first of all, no, so you've answered the question for me. I appreciate it. The latter part. This is a placebo controlled trial. We're not going to, risk the blind.
So we will see the data when all the patients have aided to 1 year. So, that's when you go to the bottom cc data. So we're really excited about the program. It's going really well from a, from a dosing perspective. Doctor.
Joyman Dowell It's been a real hero and the work that he's done. He's our principal investigator and for our, for this trial, sole investigator. Going back to the Pfizer data, the thing look, I have always been, or at least I hope I've been careful in talking about the functional data for a few patients in open label. We are very excited about the mark that what we're seeing, the signals that we're seeing, From a functional perspective, with respect to our micro dystrophin program, as I think everyone knows, we've seen very good results. All of the kids are improving at all the time points across all of the measures with very significant reductions in CK, which gives us a lot of hope, the danger in all of that, of course, is that it's a small cohort and it's a open label study.
What we really need to see there from a functional perspective is, is the results of a low control for legal trial and we're doing that right now and
we feel confident about where we
are and where we're going to end up there. So what I would say is we look across to the Pfizer data in June, I think it would be nice if they had some data on functions that just said that there was some benefit they might be seeing their kids, but we would all understand together that that is, open label that there's motivational issues associated with it as well and who knows what they're looking at for actual perspective. And if the real thing that we all need to look for and the real thing we need to consider is expression level. What kind of expression are you getting? The biggest issue with these gene therapy constructs before we said our data was whether we could actually do this.
Could you actually do full body infusions and get significant first get significant transduction across the entire skeletal muscle and cardiac muscle. And then could you create a, a gene construct that was clever enough to be able to show rate expression once there? That's the big question of these early studies. Obviously, we're very excited about the fact that the answer was a resounding yes to both of those questions for us. Last year, and that's going to be the question that one needs to look to in June.
And it may very well be the case that the answer is yes to those as well with Pfizer. But given the fact that it's 300 percent of our dose, I hope it will be a resounding yes with a good quantification. And then on function, I think the answer is really just getting some comfort as you track into a better controlled study on function.
Thank you. Our next question comes from Brian Skorney of Baird. Your line is open.
I guess just to start just jumping off of your answers to Alethia's questions on the upcoming Pfizer data. Do you happen to know the the tighter comparisons between their 3 to 14th dose? I don't know if dentists use 3 either 14th dose that they had just reported the other week. Is there anything you would read into the safety events, from the Audentis program that we're seeing particularly around the thrombus cytopenia and cholestasis? And then just as a follow-up, I heard you said that you're pretty much done with the yield optimization for the commercial manufacturer.
Can you tell us what the downstream yield you're getting on a single Icellus 500 run Thanks.
I'll answer the last question because it's a non answer. We're not going to give yield information yet. So we're a little early on that. Going back to Audentes, a couple things. I don't know.
We don't know enough about the tittering between the 2 to make grant comparisons between those 2. I will point out one thing when you evaluate the safety issues associated with the Pfizer construct. The Audentis construct. Just remember that the those Audentis patients were almost all, not all of them, but almost all of them new ones. So while it is still a big dose, it's a big, it's not an actual big aggregate dose.
These were think the great majority of these were newborns and then newborns and wedding rolls were almost all of them. And that's going to be very different, obviously, than you just send us to the district. And then of course, there are a lot of different vectors different promoter in the world.
Thank you. Our next question comes from Salveen Richter of Goldman Sachs. Your line is open.
Hi, it's Ross on for Salveen. Thanks for taking the question. I just have to the first one on the limb girdle muscular dystrophy 2E program. You're going to start the cohort 2 in the middle of this year. When can we expect an initial read on that data?
Do we have an answer to that yet?
No. I
apologize. We'll give you an update as we we start getting it closer to dosing. And we know the exact timing of the dosing. I'm not attempting to be elusive here, but, we don't have the full answer. Did you have a second question?
Our next question comes from Vincent Chen of Bernstein. Your line is open.
Great, thanks for taking the questions. A couple of quick ones from me. The first one is given your commentary on Pfizer's dosing, I was wondering if you could comment on whether you have flexibility to go up on dose for your micro dystrophin gene therapy and whether you have any plans to do so. Or if there are no plans on whether you might potentially choose to do this, but depending on what you see from the Pfizer readout?
Okay. So I'll answer that first. The preclinical perspective, so first from a preclinical perspective, there is headroom on those escalation for our construct. And certainly in the first four patients that we've seen, there's nothing about that that would contra would be inconsistent with that viewpoint actually. And just to remind everyone, in the first four patients, It was very well tolerated.
There was some mild nausea for a couple of days in 3 of the 4 patients had levered elevated liver enzymes, but all of them rapidly responded to, a bump up in steroids and resolve back to baseline very quickly. So we could dose up. We don't currently have plans to dose out for the simple reason that we're seeing significant expression. One of the things that one of the reasons we chose the dose that we chose is we did we do have a belief that it is inappropriate to to under dose patients in gene therapy. For all the bioethical reasons that we talked about earlier, we can't use children as guinea pigs.
We've got to try to find a dose that provides efficacy benefit from the very beginning. 2 times 8 to 14 is frankly a fairly significant dose, even using suprcoiled QPCR. As a measure. And then in the preclinical models, while there's there was significant headroom, some significant headroom on those ability to dose up, when you see the kind of level we're getting, you know, 90% expression level on western blot, it isn't quite clear whether we would get a concomitant benefit from dosing as it stands today, we're not considering dosing up. We're very interested to see what Pfizer has.
It's an interesting experiment to run, and we'll look at it we see it. But as it stands right now, we know where we're going. Thank
you. Our next question comes from Danielle Brill of Piper Jaffray. Your line is open.
Hi guys, thanks for the question. Just another quick follow-up on Pfizer's data. We also heard that they may present expression data measured by mass spec. I'm curious if you guys have generated data using assassay just to allow for some level of comparison in the event that they don't provide Western blot and IHC measurements?
So no, we don't have any data on mass spec. Mass spec has never been used. It's never been accepted by the agency as a measure for dystrophin It's an interesting experimental measure. And we certainly love them for thinking around the corner about other, interesting measures. I know there are scale from our cardiac MRI and a lot of other things that people are thinking about.
But if one wants to try to find a way to make meaning of expression, either against all of the literature that exists on, dystrophin positive fibers and correlating that with functional issues or looking at a prior therapies or prior trials or other programs, one has to use a combination of western blot quantification immunase to chemistry, quantification and localization, including dystrophin positive fibers and intensity And they have that data. They might have that data. They certainly have done western blotts, and they certainly would have done immunohistochemistry. So while it might be very interesting to see their mass spec experiment, what would assume if they really want to be, want to have a meaningful discussion about their program, they're going to have to show Western blot and I see that. And genome copies, predominately, which is also equally interesting.
Thank
you. Our next question comes from Joel Beatty of Citi. Your line is open.
Hi, this is Sean Egan on for Joel. Thank you for taking my question. 2 for me today. The first one's kind of a high level strategy question. Kind of as you consider building your gene therapy pipeline, now with an established vector promoter combo, already in house.
Can you help us understand kind of the factors that go into the decision process to either pursue an external partnership like the one that was announced today? Versus developing these in house that the transgene is 100 percent homologous? And my second question is also on the kind of Pfizer competitor data. You help us frame how important the biopsy location is? I think you guys have kind of pulled from the gastro while five is pulling from the upper limb.
Is there a lot of difference between those muscles and how they could express the transgene?
I'll let Luis answer the second question. I'd like to the first question, we are, we will, we are moving to a place where we're going to be agnostic about pulling from external or developing internal. So we are at least lease, when she came over to, to Sarepta brought with her, I'm proud of to say, trying to get her entire lap with her, And we're building from there. I think I've mentioned before, we have about 80,000 square foot facility in Columbus, Ohio, which is our gene therapy center of excellence. And we are looking to, we are in the middle of target identification beginning to build constructs there.
We've got some pretty significant ambitions to to don't hold this to this because obviously the discovery process is as it is, but our goal is to look to identify and elevate as many as two targets a year internally over time and we're building that. But at the same time that we do that, going to be looking externally as well. The 2A program is a perfect example of that. We have enormous regard for saying that's one of the reasons we entering to our agreement with her on January 2. And she's advanced, in this 2a.
And so the idea that we can work with her with 2a take the construct that she's already built and advance it and accelerate the program is very meaningful. So we're going to be looking above an internal and external and frankly, where it will, it's going to be sort of best athlete from a construct perspective that's going to win out over time. And then as it relates to the other question.
Sure. So your question based on upper limb versus lower limb, speaking for our nonclinical data, we looked at every single muscle and we saw no significant difference in micro dystrophin levels across those muscles. So whether it was triceps biceps or lower length like gastro on the TA. So there was no difference. So theoretically, there should be no difference to where you take the biopsies that you should get consistent results.
Thank you. Our next question comes from Anupam Rama of JP Morgan. Your line is open.
Hi guys. This is Ted for filling in for Anupam this evening. Thank you for taking our questions and congratulations from us on all the progress. One from us on what your latest thinking is on the commercial apply trial and what the gating factors are to finalizing design here, what are the key components we should be considering and how will that impact timeline to market? Thanks so much guys.
I'll answer the broad strokes. You know, the broad question is where we engage in factors and where are we with the commercial supply trial. So we are finalizing the trial, and the arms on that trial, even as we speak, we're pretty close to getting it done. In broad strokes, it remains very similar to what we talked about before, which is it will be a trial that will ensure that we have good data from a commercial perspective, both on ambulatory and on net mandatory, patients, it'll have the largest breadth of inclusion of Exxon that is possible as well. And we will have a multicenter multisite trial, both in the United States and there will be some sites ex U.
S. As well. And it will be a larger trial than the current placebo trial that we're doing And it is in the minds of the numbers I've given before kind of the 50s, 60s, 70s ratings. We haven't nailed that all down yet. We're doing some work on that.
And then on the gaming items to that, obviously, one of the things that we're going to want to do is share our views with the agency and through the agency is agreement with the path we're taking and the target profile that we would envision that path would get us. Including a broad label across all age groups, for instance. The other big gating items are manufactured. So getting this, the manufacturing process up and done and getting, all downloadable work done, the process development finally finished, the deal application finally complete, getting agency bought in on all of that. And then getting some runs done is a big gating item.
But we're on track for all of that. And our goal is to be in place, as I said, and by the end of 2019, we'll commence that trial. And then one other feature of that trial, at least as we early vision, it is an interim analysis on that trial on 3 months biopsy data. So we have the opportunity to look at biopsy data on the interim basis and compare that when we're when we actually open our placebo trial, compare that to the expression levels we're seeing in the the placebo trials so that we can confirm the comparability of our commercial supply to our clinical Have I missed any big features there?
No, I think you captured everything and obviously the site engagement is something that we are already So the site engagement is something that we're actually already doing around the world, and obviously talking not just to FDA but other agencies around the world. Thank you.
Our next question comes from Lisa Bayko of JMP Securities. Your line is open.
Hi, there. Thanks for taking my question. Perhaps a simple question, perhaps one that's more complicated. But could you, based on just your assumptions at this point, and I know there's a lot of details to be worked out give us a sense of how many patients you think you'll be able to treat from a facility such as Brammer?
We are so I can give you the broadest stroke cancer, which is our goal is to be in a position that when we launch. So Wonderful to the divisional world in which we couldn't because if everything worked brilliantly, being in a position by the end of 2020, the launch of therapy. Now I will
tell you there are a lot
of good reasons why that could slip. So I don't want to envision that that has some hard gantt chart view, but you could imagine a world that was set the case in We are building commercial supply with the most aggressive assumption of launch states so that we're in a position if everything goes well for launch then. And if we did that, we want to be in a position that, starting with our 1st commercial launch with the United States and then moving rapidly ex U S, we can completely serve the community, with therapy. So that's the short answer. And that's we want to be in a position where we're able to robustly support, the community.
And what that means is we're going to mention all of those gaining items to getting commercial supply ready for a commercial supply trial by the end of this year. And then what we're going to be doing once we get there is building supply and inventory over the course of 2020 in advance of the commercial launch of the therapy. That's why we're spending in addition to everything else over $600,000,000 in the next 15 months. And, and as I said, I hope it didn't in past, I've noted in my opening remarks, we have a 75,000 square foot facility dedicated to Sarepta that we're building with Brammer Bio science as an its parent company, Thermo Fisher, even as we speak, that's just about done in the next couple of months and should be ready for commercial supply before, obviously, before the end of this year because we'll be using that supply to commence our trial.
Thank you. Our next question comes from John Don of Danni. Your line is open.
Hi, thank you for taking the questions. So, The question is on the comparison between your micro dystrophin program versus the other 2. And specifically, on patient enrollment period. I believe the initial Phase III study had the specific requirements for patients to have frame shift or premature stop codon between exon 18 58, is the does the 24 patient study still have that criteria? And if not, why was that removed and what about the commercial scale study?
The short answer is that the current study 2 has that background exclusion in it out of an abundance of caution. There is good reason to believe that is an overly abundance of caution. And we are going to some work so that in the next trial, we are expanding the inclusion criteria significantly And we are removing the exclusions that are unnecessary and there is almost certainly many of the exclusions from an Exxon perspective are unnecessary. So our goal is to get to as close as is possible, without creating undue risk. To as close as possible to all of the exon mutations in the next trial.
Okay. And then on the age of the patient, the 24 patient study still have patients between the ages of four and seven. And that will be expanded in the commercial skill study as well.
Yes, but there'll be more there'll be other age for you as well. Now I understand this. There's been a bit of a, I think people, let me be very clear about this, and I think it will, from a surprise to people It is not our goal to have a therapy that works brilliantly in four to seven year olds alone. That is not the reason we have what is a fairly tight range. The reason we have it is that across the journey of Duchenne muscular dystrophy, there is your phenotype is going to change as you grow.
And in fact, the measures won't keep in The NSA that we're using in four to seven year olds would be inappropriate for younger children to help you something on your baileys. And then when you get past about 7, NSAs begins to become more difficult, you have to start using some other functions like
Well, actually, Fred, you can actually use it. The reason that we have port syndrome is that's the point when they are gaining or the majority. They're coming up to a plateau, so around that age six to seven. But then after seven years old, what you begin to see is those young boys are now in a stage to try. So combining the same study, it actually creates a problem.
The goal here is to confirm an effect in a small group of people. The next study was going to have different arms. So we will explore, dosing in older patients, as well as we will be exploring dosing in even younger patients, very likely. So, so our, and again, altered for 2 goals. The goal number 1 is, of course, the label and either label as we launched this therapy that allows us to fully serve the community across all age groups.
And of course, the second one is to ensure that we have a robust package for access and reimbursement that when there's therapies available to the community, patients can get there without having to wait more than an amount of time.
Thank you. Our next question comes from Timothy Lugo of William Blair. Your line is open.
Hi, Miles on for Tim.
Thanks for taking the questions. Just back on the market dystrophin gene therapy, I'm wondering whether you do actually have internal data or this data out that suggested expansion of the coverage of the exon mutations would actually be safe you said it was overly cautious to exclude earlier, but I'm wondering what's changed now? And secondly, what's your advice to patients that you've currently screened that has an Exxon mutation outside of your current gene therapy programs. Calvin to go seek therapy? Do you go to another additional gene therapy program or standard of care?
Love to know what your advice is for those patients? Thanks.
I'll answer the second one
and then I'll answer the second one and then I'll let Louise answer the first. So the point of your advice, we're not giving specific advice to patients. Along this with the specificity that you're saying, what we are saying and recommend to all patients is that they should actually pursue the standard of care, optimal standard of care and should not be concerned about that and its pursuit, while our trials are ongoing and, being designed. So we're actually quite frank about that advice to patients where possible standard care of what they should pursue, whether or not they're eligible for studies or awaiting to see if they're eligible for, for studies. And then what I've had to do is we have what's changed in our philosophy.
One final thing just to clear on that, particularly as it relates to symptomatic therapies, steroids and our PMO and those cancer therapies. There's a different issue with the gene therapy, as I mentioned before, and that you should talk about, often as a group, there is an unforgiving nature to gene therapies. You came out multiple gene therapies. You might be thoughtful about it. The symptomatic therapies don't have an issue.
But one of the things you definitely do want to do is protect yourself there are gene therapies coming. If these gene therapies are successful, there is a potential to have a transformative moment. The likelihood that one can rescue and bring back function that's long been gone, I think it probably, a bridge too far. It's probably asking too much of the therapy. Protection is the biggest issue, which means you need to protect yourself while you're waiting for a therapy.
If you have an opportunity to protect yourself with an existing therapy your physician agrees, you should be on it, you should be fighting to stay on it, protects yourself, while companies like Sarepta and Pfizer and others, work like that, to advance therapies that might be truly transformative and rescue future damage. And with that, I would turn it over to Elise to answer the question about the excellent
Sure.
To see if I could, as Doug mentioned, this was really instituted as an overly abundant with an overabundance of caution. Really based on what I would call a case study, in a earlier trial with a patient with a very large deletion and terminus And really what it shows is there's a potential theoretical potential to recognize that area of deletion. But really the implications of that were unknown whether there was even any consequence of that. So based on that, 18 to 58, mutations are not found within the micro dystrophin transgene. That's where that number came in.
So it's very, It's very conservative. And so we feel very good about expanding beyond that just based on mutations that already have a a normal amount of the or a trace amount of the protein. So we are definitely expanding in a rational way. We think that we have a very good reason to do so.
Thank you. Our next question comes from Tim Chang of BTIG. Your line is open.
Hey, thanks. Doug, when I was at the MDA conference, you know, the Catalyzer So they've gone up to 3E to the 14 on the dose and then they had come back down to 2E to 14 of the dose. Is that something that you guys have heard as well? And then also, on limbgirdle 2a phenotype, Louise, could you compare and contrast 2a phenotype to 2b phenotype? I mean, are there very clear distinct differences?
Obviously, a different gene you're delivering But, I guess, what, the 2b phenotypes, it's a dual vector. Could you just confirm the 2A, a single vector that you'd be delivering on the chain?
To answer your question. So with the lgMD2 fee, the Dysferlin, that's a dual vector, and the, calcium program, we're living in the calcium gene. That's a single vector. In both cases, we're delivering the full length gene. There are to your point similarities, between the phenotypes there's We know there's interactions between these two proteins, so it's not surprising, but there's a, there's similarity in the disease.
Okay. And then so let me answer on this. So the answer on I really had reticent to to sort of pass along rumors. There has been a lot of talk about this drop down just for those to make sure everyone's on the same page. Recently was this, it was revealed by Pfizer that they have a protocol that's an interesting protocol on unusual I think where it dosed that they are one times either 14.
So I will remind you is probably about the same as our 2 times either 14th given the tires. And then they chose to go to 3 times E to 14, which again, is probably something like 6 times E to 14 using our measures And then they have what they recently discovered was, that we've discovered is that they have this constant dropdown where they could drop back down to some middle dose between the 2, at 2 times, if they are 2 times either 14, which again would be our 4 times. The, that was Steve, you
get my point. I was
not reading that for you. Most recently, we've heard that they are saying that they have not yet dropped down in between those 2. So what we're envisioning right now is we're going to see on in June. And what we understand at least from mean, investors is we're going to see 2 cohorts, 1 cohort of 3 patients at one times, even 14th, and then one cohort of 3 patients at three times each of 14th. And then I don't know how they've made a final decision about what they're trying to drop down.
I will know that we're this is we don't have anything like that. So for instance, with respect to our 2E program, as we've mentioned, our protocol provides we are dosed at five times E to 13th and we're now going to dose at a higher dose to explore at two times E to 14th. And then as when we're done, we're going to make a decision about the risk benefit and the efficacy and safety of those 2 doses and make a decision between And the good news is that we don't have good expression in five times E to 13. So if we don't see a significant benefit going higher, then obviously we're not going to put these kids under unnecessary amount of viral
So this is Gilmore here again. I just wanted to follow-up on that when you asked the question, you talked about, the 2 programs micro dystrophin, our micro dystrophin and Pfizer. I just want to follow-up on the mass spec question, because I know you're all sophisticated thinkers and would be very careful about comparing apples and oranges Western versus mass spec. I think there are certain things that you should actually look on into methodology to be very clear about the methodology being used not least of which is that in developing our Western blot, we and Louise Nationwide optimize that methodology to ensure that the Western blot was measuring monomer. The is an issue potentially, and you look at how the mass spec actually pulls down the peptides because mass spec doesn't actually use the full protein, it actually digests the protein and then actually measures peptide fragments.
And then essentially computes them together. So one has to be very careful in understanding how much or how the specificity is of the mass spec methodology for identifying and quantifying monomer. So I think it'd be very it's very important for everyone that's looking at mass spec to actually consider the methodology and the details of that and take, be very cautious about comparing across methods. Thank you.
Our next question comes from Joseph Schwartz of SVB Leerink. Your line is open.
Good afternoon. Thanks for taking our questions. This is Digon dialing in for Joe and congrats on all the progress. So I had 2 broad questions, one on manufacture and one on the competitive landscape. And no, that's not Pfizer.
I don't want to go into Pfizer data. But briefly on manufacturing, The recent ASGCT, there was a lot of presentations and talks on manufacturing and the various methods. So looking at your press release, you have the 75,000 square feet at Brammer. And so I just wanted to get your take on question 1. What kind of conversations or interactions and feedbacks have you received from the FDA with regards to systematizing multiple iCELLis units to make your material?
And the second question is, as it pertains to manufacturing, we've heard a lot about how the downstream and the analytical message are a huge opportunity for optimization. So can you briefly comment on where you stand with those, analytical and downstream recuperation yield?
So in the broadest of strokes where just to remind everyone, we've chosen, we were at, we're using clinical supply formation wide and that's in the 1,000,000 adherent process in hyper stacks. But it's not a very scalable process because it's a 2 dimensional process. I sell it to very similar to the adherent process as well. It's a 1,000,000 as well, but it's a three-dimensional process, which allows more scale. We're an ongoing dialogue for the agency and on issues and questions, we're likely to do, the Astellas units and analytics and the like.
The good news, just so we're all clear one comforting aspect of all this is that there is even though gene therapy is, in many ways, nascent, there is good precedent for this one thing, which is moving from, hyper stacks to iCELLis units and systematizing iCELLis units. And the reason for that is because this is exactly what the large is doing adds up. Novartis' program was a sister program in a sense to our program over at Nationwide Children's Hospital. Their program started at hyperstacks and mammalian and transitions over to commercial supply at, at, Icellus units with the same 1,000,000 of hearing process with Icellus units. So while there's a lot of work to be done, we're confident that the pathway has been trodden, with Novartis, which we understand should be getting approved sooner.
So I think we're in good shape there. Got a lot of work to do on the downstream side, but a
lot of work to do on
the analytics side. And certainly there is optimization to be done on the downstream side and the groups looking at that. Even as we speak, a mutual way a big part of that as well.
Thank you.
I'm showing no questions at this time. I'd like to turn the conference back over to CEO, Doug Ingram, for any closing remarks.
Thank you very much. First, I want to thank everyone. For joining us this evening for our conference call. Hopefully, we'll come away with the understanding FirstNet at least so far this year. The team that I have gathered around me at Sarepta has been doing a very good job of executing.
I'm very proud of all of them. And then beyond that, one would understand that we have a lot more to execute on in 2019, and that this will be a very consequential year first for patients and then for Sarepta and our long term goals. And certainly, if we're successful at all that, for our shareholders and the, and the, shareholder value. As we look forward over the course of 2019, not only executing, but bringing more updates to the investment community. So thank you and have a good evening.
Thank you. Ladies and gentlemen, discuss does conclude today's conference. Thank you for your participation and have a wonderful day. You may all disconnect.