Good day, and thank you for standing by. Welcome to the REGENXBIO Inc. First Quarter 2023 Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Patrick Christmas, Executive Vice President and Chief Legal Officer. Please go ahead, sir.

Good afternoon, and thank you for joining us today. Earlier this afternoon, REGENXBIO released financial and operating results for the first quarter ended March 31, 2023. The press release and data presentation are available on our website at www.regenxbio.com. Today's conference call will include forward-looking statements regarding our financial outlook in addition to regulatory and product development plans. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted and can be identified by words such as expect, plan, will, may, anticipate, believe, should, intend and other words of similar meaning. Any such forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties. These risks are described in the Risk Factors and the Management's Discussion and Analysis sections of REGENXBIO's annual report on Form 10-K for the full year ended December 31, 2022, and comparable Risk Factors section of REGENXBIO's quarterly reports on Form 10-Q, which are on file with the Securities and Exchange Commission and available on the SEC's website. Any information we provide on this conference call is provided only as of the date of this call, May 3, 2023. And we undertake no obligation to update any forward-looking statements we may make on this call on account of new information, future events or otherwise. Please be advised that today's call is being recorded and webcast. In addition, any unaudited or pro forma financial information that may be provided is preliminary and does not purport to project financial positions or operating results of the company. Actual results may differ materially. I would now like to turn the call over to Ken Mills, CEO of REGENXBIO. Ken?

Thank you, Patrick. Good afternoon, again, everyone. Thanks for joining us. I'm pleased to begin today's call or continuing today's call with a recap of our recent business highlights as well as an update on our corporate goals. Dr. Steve Pakola, our Chief Medical Officer, will then provide an update on our clinical programs, and VittalVasista, our Chief Financial Officer, will provide an overview of financial results for the first quarter ended March 31, 2023. At the end of the call, we will open up the line for questions. At REGENXBIO, our mission is to improve lives through the curative potential of gene therapy, and we're focused on developing therapies for diseases that have significant unmet need. We continue to be a leader in gene therapy with thousands of patients who have been dosed with AAV therapeutics derived from our NAV Technology Platform. There has been meaningful progress in the gene therapy industry lately, including growing understanding of gene therapy pricing models and the FDA validation of surrogate markers as viable clinical endpoints. REGENXBIO continues to work closely with our regulatory partners to help advance and accelerate the development of gene therapies, particularly for rare diseases. Today, I'm pleased to discuss how REGENXBIO remains a leader in gene therapy as we share with you how our 5x'25 strategy is on track for advancing 5 AAV therapeutics from our internal pipeline and licensed programs into pivotal stage or commercial products by 2025. Our end-to-end capabilities continue to set us apart as a leader with our in-house manufacturing innovation center running scalable, commercial-ready batches of our AAV therapeutics and our research and early development experts continuing to advance what's possible in gene therapy. In fact, this week, we announced a summary of around 15 presentations at the upcoming ASGCT conference, which reflect…

Thanks, Ken. I'll begin with an update on 314. 314 uses the NAV AAV8 vector to deliver a gene encoding of therapeutic antibody fragment to inhibit vascular endothelial growth factor or VEGF. Building on what Ken shared, I want to share more about 314 for the treatment of wet AMD using subretinal delivery and the program we are running to support new global registration plans. REGENXBIO and AbbVie have expanded enrollment in the ongoing ATMOSPHERE and ASCENT trials, the 2 pivotal clinical trials evaluating 314 in patients with wet AMD using subretinal delivery to include patients in the U.S., Europe, Japan and Israel. ATMOSPHERE and ASCENT will enroll approximately 540 and 660 patients, respectively. This action will increase power of primary and secondary endpoints to enable these global regulatory submissions and labeling options. Additionally, we shared interim data updates in February from the Phase II BRIDGING study. This study is designed to evaluate the same dose levels being used in the 2 pivotal trials. In this trial, material from our proprietary NAVXpress platform manufacturing process was well tolerated with patients demonstrating stable to improved BCVA and central retinal thickness and meaningful reductions in anti-VEGF burden. The majority of patients were injection-free following treatment with 314. Lastly, we also announced today that a fellow eye treatment study has been initiated as part of the pivotal program using subretinal delivery. This study will evaluate the safety, efficacy and immunogenicity of subretinal 314 administration in the fellow eye of patients from ATMOSPHERE and ASCENT who have bilateral disease and previously received a subretinal injection of 314. Data from patients enrolled in this study are expected to further support global regulatory submission plans. We also continue to advance 2 additional 314 programs for the treatment of wet AMD and diabetic retinopathy using in-office suprachoroidal…

Thank you, Dr. Pakola. REGENXBIO ended the quarter on March 31, 2023, with cash, cash equivalents and marketable securities totaling $474 million compared to $565 million as of December 31, 2022. The decrease was primarily driven by cash used to fund operating activities during the first quarter of 2023. R&D expenses were $59 million for the first quarter of 2023 compared to $56 million for the first quarter of 2022. The increase was primarily attributable to personnel costs as a result of increased headcount and laboratory and facilities costs driven primarily by the activation of the REGENXBIO manufacturing innovation center in mid-2022. We expect the balance in cash, cash equivalents and marketable securities of $474 million as of March 31, 2023, to fund our operations into 2025. This cash runway guidance is based on the company's current operational plans and excludes the impact of any payments that may be received from AbbVie upon the achievement of development or commercial milestones under our 314 collaboration. With that, I will turn the call back to Ken to provide final thoughts.

Thanks, Vit. We continue to perform at a high level as we execute on our mission of improving lives through the curative potential of gene therapy. The updates from our Eye Care collaboration with AbbVie today represent a serious and continued commitment to the innovation involved in addressing unmet need and bringing a paradigm shift to the treatment of major retinal diseases worldwide. We're focused on optimizing the value of the opportunity for 314 by expanding that global reach and supporting the profile of this potential onetime treatment. Steve did a great job of summarizing a lot of the progress we've made here in the first quarter. And looking ahead to the remainder of the year, we anticipate a number of key milestones that are going to continue to highlight the potential of our onetime AAV gene therapies. The interim updates expected in the second half of the year for AAVIATE and ALTITUDE suprachoroidal trials, the initial data from the AFFINITY DUCHENNE trial in the second half of the year, completing enrollment in the first half of the year in the CAMPSIITE trial for 121 to support the BLA submission in 2024 using the accelerated approval pathway and sharing additional updates on program plans for 111, 181 and 381 for Hurler syndrome and Batten disease are all important upcoming milestones. We have a lot of important value-driving catalysts ahead of us this year with a balance sheet to fund our mission and operations into 2025. With a focused and a high-performing team, strong collaborators and the trust of clinical and patient community partners, I believe we have a clear and definable path to achieve our 5x'25 vision and continue to lead what's possible for AAV therapeutics. And we look forward to providing you updates as we continue on this path throughout the upcoming year. With that, operator, I think we are ready to transition to Q&A.

[Operator Instructions] First question comes from the line of Gena Wang with Barclays.

I have 2 parts of the question. First one is regarding the ATMOSPHERE and ASCENT upsizing by AbbVie. So wondering, can you remind us the assumption for the 3 cohort study. And with increased power, what secondary endpoint will be important for regulatory submission? And related question for manufacturing process from the in-house NAVXpress platform. What percentage of patients need to be dosed in order to clear regulatory requirement? My second question is regarding the DMD, second half this year to update. I assume the safety also will be very important update there. What kind of a safety profile will warrant the removal of the prophy SOLIRIS treatment?

Thanks, Gena. I'm going to let Steve address the first question and circle back on the last 2.

Gena, thanks for the questions. Taking the first part of your first question, basically, the powering concepts for the 2 pivotal studies. We have always a reasonably standard powered for the primary endpoint to have at least 90% power. As we've informed in the press release, now that we have a global partner with AbbVie, we can think beyond the U.S. and really think of the tremendous opportunity we have to globally develop to reach more patients. And that's really the aspect where with more patients, we can increase power for also the secondary endpoints. That can be particularly important when thinking of labeling and associated health technology assessment negotiations that, for example, occur in Europe. So for that reason, we're very excited about increasing the sample size. As far as which endpoints, secondary endpoints we achieve greater power for, of course, with more patients, there's greater power across the board. But some of the ones that are potentially particularly interesting are the value drivers of decreased treatment burden. So with more patients, we can look across all these different cuts of treatment burden, for example, what's the supplemental injection rate of patients after treatment with RGX-314, what's the reduction in that treatment burden, what proportion of patients required no injections, what proportion of patients require less than certain other thresholds. And that's just to name a few. But again, we're well excited at the opportunity that we have greater power across the board for these to help us in our [indiscernible] plans. The second part of your first question, I think, related to the -- was it the fellow eye?

No, it was about manufacturing and just...

Oh, okay.

I don't know, Gena, that we have a cutoff for the percentage of patients that are required across the different global regulatory agencies. I think there's generally a perspective, and we've already started to adopt the use of the process in the pivotal trials as well as the other global expansion trials like the fellow eye work. And obviously, the bioreactor study is a direct comparator of the original process to the new process. We've also, in the case of suprachoroidal, actually been using bioreactor process almost out of the gate in AAVIATE and ALTITUDE. So I think we feel like we're in a great place. Really, what we're focused on right now with respect to the manufacturing work is the qualification lots that will support commercial inventory, which will begin in 2023. And with respect to RGX-202, we're early in the process of obviously evaluating safety and tolerability. We said we'll have our first updates in the second half of this year. And I think we're looking forward to reporting on information that would inform us not only about how to continue to navigate forward with respect to dose expansion or dose escalation, but also to potentially make some more informed decisions with respect to some of the protocols that we have in place in the sort of early safety assessments right now. It's too early to predict until we see the data, Gena, exactly how things will navigate forward from here. But we'll be relying on internal expertise and experiences, as well as the people that in the field guided us for the implementation of the use of the immunosuppression protocol, including eculizumab from starting point, I mean, this was, I think, a very important sort of multi-stakeholder process that we went through to begin with. And I think we'll continue to sort of inform forward-looking decisions on the same basis.

[Operator Instructions] Next question comes from the line of Dane Leone with Raymond James.

Congrats on the progress. Could you just maybe clarify for everyone whether there was actually an alteration in the agreement with AbbVie? I think some of us had thought that there would be a transfer of the regulatory responsibilities as the cost shift occurred in '23. So just trying to understand the nuance of what may have changed in the agreement. And then secondly, could you just opine a little on some of the poster presentations that you have coming up at ASGCT? Curious to know how serious we should take the GA program that's being presented there. And if you do have a view on terms of bringing that into the clinic, what the timeline might be for that.

Thanks, Dane. Appreciate the question. I think on the agreement side, I think the message is landing the way we intended it. I mean, we've said since the beginning of 2023 that under our original collaboration, AbbVie has transitioned to taking on the majority of cost for the program overall and that it was also originally expected for the IND transfer to occur that happens to now be overlapping with the announcement today of the global expansion work that we're doing with respect to ATMOSPHERE and ASCENT. But this is not anything that was new with respect to the original collaboration understanding. These are all sort of programmatic things that are being implemented now that we're about a year or maybe over a year into the collaboration that, of course, took time between the teams to execute on. And with respect to the ASGCT presentations and posters, we're excited to -- I will always be able to share a lot about the research that goes on within REGENXBIO across multiple different therapeutic areas. We've been and continue to be focused on targets that have significant unmet need in our significant populations. Obviously, we have a curiosity and a strong interest with respect to indications that can extend into areas that we already work in, including in and around retina. So I don't think that we're saying anything more than that right now. It's just that we have a really strong research engine with respect to work that's led by Olivier and his team is very much in contact with work that we do in the clinic, both on the device side, on the technology side and on the clinical experience side. And we've said all along that we're going to continue to look for high-value indications to add to our pipeline. And this is an opportunity for us to show some of the basic research that's going on but certainly not any specific guidance about any new INDs that we're announcing today.

If I could just add one follow-up to that. I was excited to see the addition of the bilateral cohort being run. Is that an endeavor that would actually need a separate study? Or is the cohort that you're going to be exploring fellow eye treatment in could suffice for actually having a label at the end of ATMOSPHERE and the pivotal program to allow bilateral treatment?

Dane, yes, this fellow eye protocol allows patients who've been treated in either ATMOSPHERE or ASCENT to have their fellow eye treated with RGX-314 or 314, sorry. This actually is as per plan from way back our end of Phase II meeting discussions with the FDA, where this was certainly part of the package that we have some exposures in fellow eye so that we've treated both eyes so that, that would be allowed in the label.

[Operator Instructions] Next question comes from the line of Vikram Purohit with Morgan Stanley.

This is Gospel on for Vikram. So we have two questions. So the first one is how does the decision to expand enrollment in ATMOSPHERE and ASCENT impact your thinking on the registration pathway and all pivotal studies for the suprachoroidal delivery of wet AMD? And then the second one is for the RGX data expected in the second half of this year. Would you expect to release this data to a top line release? Or is there a medical conference or venue that would be suitable for it?

Yes. Thanks, Gospel. I think I can hit these, and then Steve has more to offer. But I don't know that we see a direct impact with respect to the regulatory path. We're very advanced with subretinal. And I think as we were just talking with Dane about including things like fellow eye studies and sort of preparations for qualifying lots for supporting commercial manufacturing. I think we're -- our view is that we're hurdling towards important milestones for regulatory approvals that we've given guidance on now, both in the U.S. and outside of the U.S. for the subretinal approach. With respect to suprachoroidal, we're going to have -- we're still in sort of dose-ranging mode in Phase II. I think the -- of course, it's strongly influenced by the same pharmacology. I mean, RGX-314 , obviously, its activity, its ability to show biological activity and treatment effect in a kind of first product with the subretinal delivery, I think, has a strong indirect influence. But right now, I don't see any direct relationship between our forward-looking plans for how we complete the work to support the filings and approvals of subretinal and where we are with suprachoroidal. And again, they're related, they're tethered, of course, because of the same pharmacological agents. But otherwise, they're as we've been guiding for the last year or so. And with respect to AAVIATE and ALTITUDE, usually, those are decisions that are made closer to the point in time when team has reviewed the data and is able to sort of assess opportunities for presentation. I think our practice and our view has been to do these at medical conferences. And I think that AbbVie generally shares that view when we come together on these topics. And I think that's the most meaningful guidance we can, in addition, give there right now.

Okay. One more question, please, for the RGX-202 data for Duchenne. I was wondering, so what did a release, is it going to be a top line release or a medical conference?

Haven't decided yet. So I think, again, it will depend a little bit on the timing. Certainly, we keep our eye on conferences that would be appropriate venues for that just as we do for the retina work. But we will -- that will be a decision that will be made up again a little bit closer to, frankly, in the second half of the year, Gospel.

[Operator Instructions] And our next question comes from the line of Alec Stranahan with Bank of America.

Just two from us. Appreciate all the color on 314 and the updates on the AbbVie partnership. Any additional details on the thought process that would go into moving 314 into pivotal studies for suprachoroidal delivery or in DR? And as this go, no-go now under AbbVie's full discretion? And secondly, on DMD, given that you're preexisting patients into AFFINITY BEYOND, is there an expectation that a subset of DMD patients could have preexisting AAV8 antibodies that could lower efficacy of 202? And a refresh on any of the mitigation steps that went into the design of 202 would be helpful.

So thanks, Alec. So on your first question on 314, so for suprachoroidal in-office delivery, we're making great progress in our Phase II evaluation with these dose escalations in both of the studies for wet AMD and DR. And we're learning a lot. We've already learned a lot with these first-ever suprachoroidal deliveries of gene therapy. And we're excited that we have the opportunity to evaluate a short course ocular steroid treatment to further mitigate any risk of inflammation. So it's really going to depend on readouts from these existing cohorts that we're going to disclose at least initial results later this year. I think the process we and AbbVie go through, and it is a joint process with our joint committees, where we collaborate very closely on evaluating any new data cuts that come out. And it really comes down to at what point do we feel we potentially could be meeting target profiles for either of these indications that then triggers when we believe we could go into pivotal development for either of those indications.

Yes. I think that we have a view that we're well aligned with AbbVie at this stage in terms of being incentivized to move as judiciously and as quickly forward as we can based on the data that we see. And we're in the process, having just fully enrolled both ALTITUDE and AAVIATE with the expansion cohorts to have opportunities to look at new data from those cohorts as well as continuation of data we've already reported. So I think it will be a good point in the second half of the year to revisit that question and sort of establish where we are with respect to that process overall. On the 202 side, I think I understand your question, which was we've got this AFFINITY BEYOND study going on, looking at incidence or prevalence of preexisting AAV8 antibody titers in patients. And absolutely, I think as a class, AAV microdystrophin products, I think this is a focus for all of us. We know this from other experiences and other trials that we've run, including our AAV8 intravenous trial in HoFH. And our peers are all generally in clinical phase, screening out patients with measurable or certainly above a certain threshold titers of preexisting antibodies to their specific capsid. And I think we're all looking to be able to characterize that and evaluate it commercially. There's a lot known about AAV8. It actually is already from studies that have been published and that we've worked on, knowing that it's a relatively low prevalence with respect to our preexisting, but we want to study it specifically in this disease basis, too. But I know that if you're working with AAV9 or another AAV8, you'd focus on the same thing. So right now, our trial is excluding patients who might have antibodies to AAV8 for purposes of enrolling in the treatment study. We're building this body of evidence to understand more, both clinically and commercially, how we keep navigating this program specifically with AFFINITY BEYOND.

[Operator Instructions] Our next question comes from Ellie Merle with UBS.

Just a little bit more color on the Phase III modification. Maybe can you just comment on any FDA and EMA recent interactions and just the latest feedback that you've gotten from them, particularly any feedback on the Phase III expansion as well as the latest feedback on manufacturing after the bridging study? And then just a broader question on the Phase III trials. I guess just according to the protocols, I guess, what kind of like data monitoring or interim analyses that you have ongoing in the study? I'm just kind of curious, have there been anything in terms of the data review such as, say, an interim that may have prompted the decision to increase the study sizes?

Ellie, so as far as any regulatory FDA or other interactions, this opportunity and the action to increase the sample size was not driven by any FDA interaction, though, of course, with any protocol amendment, these get submitted. So this is in line with the protocol and has been submitted to the FDA. So there's no issues there. As far as the monitoring, I remind this is a mass ongoing study. So there's certainly no opportunity to be looking at any efficacy results in this. And there's just really the standard medical monitoring that's applied in this kind of study.

Understood. And then just a question in terms of DMD. Can you maybe just comment how many patients you've enrolled and dosed so far?

We haven't updated on that today, Ellie.

[Operator Instructions] And our next question comes from the line of Luca Issi with RBC Capital Markets.

This is Lisa on for Luca. First, maybe one on the fellow eye study. And Just wondering, is the bilateral dosing going to be done at the same time? Or is there going to be a stagger between the doses due to the subretinal administration? And if there is a stagger, what gives you the confidence that the fellow eye will not have high levels of neutralizing antibodies against the vector? And I have another follow-up.

Yes. So as part -- as you can imagine, as part of clinical trials, we don't want to confound the parent study evaluating the study eye by having a fellow eye treated in any type of proximity. So in the fellow eye study, this will generally be patients who are getting their fellow eye treated sometime later, maybe a year or 2 years after having their study eye treated. In the real world, we know, for example, historically with LUXTURNA, totally different disease setting and other considerations, the concept of timing them closer together, which can have the added safety consideration of at least theoretically, minimizing induced immunogenicity. Though one of the benefits of subretinal, of course, is the relative immune privilege status. So we anticipate good safety and tolerability in the fellow eye. But you raised a good point. We have to actually demonstrate that given that treatment even with subretinal delivery, you can have at least the asymptomatic antibody response. So this will be our opportunity to evaluate that.

That's helpful. And then just maybe on DMD. Given your competitor as a gene therapy that's close to approval, how do you think this will impact the regulatory path forward for your program? Will it still be possible to go after the accelerated approval pathway with microdystrophin as a biomarker if a full approval ends up being granted to your competitor? Any color there would be helpful.

Yes. Thanks, Lisa. I mean, I think it's really hard to speculate too much, especially in these rare disease areas and including in gene therapy where it's going to be known that there are kids that are going to be excluded from the potential to receive certain of the gene therapies because of the topic that we were talking about with one of the analysts before that certain patients are going to be excluded for accessing certain therapies, especially systemic therapies because of preexisting immunology. And then they may be able to receive an alternative therapy that's up for approval or in development. So -- and in general, I think we've seen a great interest on the part of regulators and the community to support many product alternatives in those types of circumstances where you might see populations that have access issues or just generally with respect to responsiveness. We're really excited and encouraged about the views that the agency taking on concept of accelerated approval and the use of surrogate biomarkers to predict clinical benefit. And we like the position that we're in with respect to being in a class of medicines that is under review because we are going to learn a lot in now days, not even weeks or months anymore. But I would say that we view that there's a lot of options, and they will be informed by some of the process and the decision. But my sense is that it opens more doors than it closes.

[Operator Instructions] And the next question comes from Mani Foroohar with SVB Securities.

This is Lillian [ph] on for Mani. Just a question in terms of the partnership on 314. So regarding the development and regulatory milestones, could you provide us some update maybe of where we are in terms of what's potentially to be received in terms of subretinal versus suprachoroidal as well as wet AMD and DMD?

Yes. I don't think we've given too much specific guidance since we announced the collaboration. I think we emphasized that there's about $1.3 billion or $1.4 billion of potential outstanding development and commercial milestones that remain with, I think, around half of that potentially being associated with development milestones for transitions into later-stage development for new indications or including the suprachoroidal platform. So I think those would be the things that would be opportunities for nearer-term access pre-commercial, in particular with respect to development milestones. And I think as we get into periods of time where those evaluations are ongoing, we sort of update interpretations of data, we can perhaps give some more clarity. But at this time, we -- as I think Vit spoke to with respect to even our cash guidance, we're not including any of those milestones right now in any of our plans. It's very not typical for us to do that. So we're being very conservative about the cash guidance that we're giving even though we have known upcoming data readouts with respect to certain of these programs that could inform these things.

[Operator Instructions] Next question comes from Caroline Palomeque with Berenberg Capital Markets.

I think Ken, at one point, you mentioned that RGX-314 had a durability of over 4 years. So you have some patients that have shown that level of durability. And I'm just wondering, is there a certain patient profile, I mean, aside from NAV negative that you can speak to that tend to show higher durability. And then as a follow-up to that, can you speak to any FDA guidelines on gene therapy in the ocular space that -- is there any discussion going on about what an acceptable threshold of durability is for approval?

Yes. Caroline, when we're talking about subretinal, first of all, these are all patients that we didn't even screen on the basis of preexisting immunity. So I'm not even sure that we know that these patients, several of them are out 3, 4 years with durability, and they could be NAV positive [indiscernible]. I don't even know that I've seen that data per se. And so that's a very positive statement to make about the commercial opportunity, by the way, for subretinal that has no impact. We later showed that it seems that suprachoroidal also is not impacted by preexisting immunity. So this is all a very different space than intravenous delivery. I think with respect to thresholds and sort of interest that the agency has, I think that it's multilayered. I think for approval, it's kind of -- durability is something that I think is kind of on a shorter interval. I would say a year, which is basically the measures of our primary endpoints in our pivotal trials as well as how we're studying things even at early phases is you accrue enough patients with respect to a year. And both on a primary and a safety basis, I think you're setting yourself up for approval with respect to the agencies. I think the question really comes to bear on the payers and the providers and the adoption of the treatment overall. So -- and this is -- we're highlighting today, I think, how much further along, how much deeper, how much broader our program is. And we'll continue to be in wet AMD and in diabetic populations with respect to 314 across additional devices and how important that information is for global development and ultimately, global commercialization. So while the FDA, a group like the FDA, I'm sure they're going to be happy when a package comes in with 3-, 4-year data, and it will give them more confidence, I'm not sure it's going to be something that's sort of -- it's heavily weighted. But I think when we're in the payer environment and we're in the -- with this globalization when we're in the health technology assessment environment, these things are going to become, I think, incredibly important and I think the differentiation for where we are with 314, our view is really meaningful and one of confidence.

And I'm currently showing no further questions at this time. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.