Good day, and thank you for standing by. Welcome to the Sangamo First Quarter 2021 Teleconference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Aron Feingold, Head of Corporate Communications. Please go ahead.

Good afternoon, and thank you for joining us today. With me this afternoon on this call are several members of the Sangamo executive leadership team, including Sandy Macrae, Chief Executive Officer; Mark McClung, Chief Business Officer; Jason Fontenot, Chief Scientific Officer; Rob Schott, Head of Development; and Bettina Cockroft, Chief Medical Officer. Slides from our corporate presentation can be found on our website, sangamo.com, under the Investors and Media section on the Events and Presentations page. This call includes forward-looking statements regarding Sangamo's current expectations. These statements include, but are not limited to, statements relating to advancing our programs, plans and time lines for enrolling and conducting clinical trials, presenting clinical data and opening new manufacturing facilities; our 2021 financial guidance; our expectations regarding our financial performance and sufficiency of our cash resources; and other statements that are not historical fact. Actual results may differ materially from what we discuss today. These statements are subject to certain risks and uncertainties that are discussed in our filings with the SEC, specifically our annual report on Form 10-K for the fiscal year ended December 31, 2020. The forward-looking statements stated today are made as of this date, and we undertake no duty to update such information, except as required by law. On this call, we discuss our non-GAAP operating expenses. Reconciliation of this measure to our GAAP operating expenses can be found in today's press release, which is available on our website. Now I'd like to turn the call over to our CEO, Sandy Macrae.

Thank you, Aron, and good afternoon to everyone on the call. This quarter, we have continued our focus on advancing our lead programs through clinical execution, regulatory interactions, and collaborations with our partners and investigators. This morning, Pfizer CEO announced on their earnings call, the progress continues with our partner hemophilia A gene therapy product candidate, highlighting the lead-in study for Pfizer’s registrational Phase III AFFINE clinical trial is now fully enrolled, which could lead to a pivotal readout as early as 2022. With Sanofi, we announced that the EMA has granted Orphan Designation to BIVV003, now known as SAR445136, our cell therapy product candidate for the treatment of sickle cell disease. The Orphan Designation was based on preliminary clinical observations submitted to the agency. We and Sanofi, also received Fast Track Designation from the FDA for this program. We are pleased with this progress and expect to present initial data at a medical meeting by the end of 2021. In March, we initiated our STEADFAST clinical study evaluating TX200, our wholly-owned CAR-Treg cell therapy product candidate in renal transplant rejection, which we believe will be the first-in-human clinical study of a CAR-Treg therapy. We were pleased to open clinical sites sooner than expected and hope to have our first patient enrolled by the end of the year. We see this study as the first step in our R&D journey towards allogeneic CAR-Treg therapies for autoimmune diseases, which we hope to develop as wholly-owned product candidates in our pipeline. Our research engine has been highly productive this quarter. We continue to focus in our innovative areas, including CAR-Tregs for autoimmune diseases and transcriptional regulation with zinc finger proteins for neurological diseases. The versatility of our zinc finger technology to address challenging disease of the central nervous system was highlighted this quarter with data publications and presentations from our tau- and alpha-synuclein programs. Before I turn the call over to the team, I'd like to take a moment to acknowledge that this quarter marked one-year of working in the challenging conditions of the pandemic. I continued to be so impressed by the Sangamo team’s resilience and determination as our lab employees have adapted to distancing procedures and as our remote colleagues tune into Zoom calls from kitchens and bedrooms. I am proud of the strong team we have in place to execute on the catalyst-rich year we have ahead of us. With that, I will turn the call over to Rob Schott, our Head of Development to provide additional details on our clinical accomplishments. Rob?

Good afternoon. Our development organization remains focused on execution in the clinic, and we are pleased with this quarter’s progress. As Sandy mentioned, enrollment in Pfizer's lead-in study in the Phase III AFFINE trial evaluating our hemophilia A product candidate is complete. The purpose of this study is to collect a minimum of six months of prospective efficacy data of current Factor VIII prophylaxis replacement therapy in patients with hemophilia A to establish baseline characteristics prior to dosing with giroctocogene fitelparvovec in the AFFINE trial. Pfizer expects a pivotal data readout as early as 2022 as well as a two-year update from the Phase I/II Alta study in the fourth quarter of this year. Regarding our Fabry program, we continue to advance the Phase I/II STAAR study, and we have recently enrolled the fourth patient. We plan to present initial data from this study in the fourth quarter of this year. In March, the EMA granted Orphan Designation to BIVV003, now known as SAR445136, our sickle cell disease product candidate partnered with Sanofi. This decision was based in part on early data from three treated patients that had 52 weeks, 13 weeks, and 29 days of follow-up, respectively. In a recently published minutes, the EMA’s Committee for Orphan Medicinal Products determined that preliminary clinical observations, as well as the potential of long-term effects that may obviate the need for frequent treatment suggest a clinically relevant advantage versus hydroxyurea. Last month, Sanofi announced that this program received Fast Track Designation from the FDA. We find the progress on this program encouraging. We and Sanofi expect to present the initial data from the PRECIZN-1 study at a medical meeting by the end of this year, which will reflect a more mature and more comprehensive dataset than the early data shared with the…

Thank you, Rob, and good afternoon, everyone. Today, I am delighted to give you an overview of few of our exciting research programs. We can engineer our zinc finger proteins or ZFP to precisely target essentially any DNA sequence in the genome. We have invented methods to two ZFP interactions with DNA to optimize specificity and precision, and we have developed methods to pair this targeting capability with a range of functional domains. These functional domains include transcriptional activators and repressors that can modulate gene expression without altering the genetic code. Nucleases that can edit DNA sequences and we are advancing ZFP targeted base editors and [indiscernible]. We can deploy these tools in vivo or ex vivo to create powerful therapies with the potential to treat significant diseases. As Sandy touched on, we are using our zinc finger protein transcription factors to develop promising therapies for diseases of the central nervous system and had some exciting preclinical data highlights this quarter. First, data from our tau program in collaboration with Biogen published in Science Advances showed the tau-targeted zinc finger transcriptional repressors delivered by a single AAV administration, selectively reduced tau messenger RNA and protein by 50% to 80% out to 11-month, this without detectable off-target effects. Second, data from our alpha-synuclein program, also in collaboration with Biogen presented at the Alzheimer’s and Parkinson’s Disease Conference showed that alpha-synuclein-targeted zinc finger transcriptional repressors could significantly repress human alpha-synuclein and were well tolerated in vivo. And finally, data from our alpha-synuclein program as well as our C9ORF72 program, which was exclusively licensed to Pfizer, have been selected for presentation at the American Society of Gene and Cell Therapy Annual Meeting next week. We look forward to keeping you updated on these and other preclinical programs as we advance. As Rob mentioned,…

Thank you, Jason, and good afternoon, everyone. As Aron had mentioned previously, our financial results for this quarter are available in the press release issued this afternoon, which can be found on our website. This quarter, we invested in the advancement of our clinical programs, moving forward our preclinical research pipeline and continuing to build our in-house manufacturing capabilities. We ended the quarter with approximately $630 million in cash, cash equivalents and marketable securities. We believe that our balance sheet remains strong and will allow us to reach several important R&D milestones, including the potential submission of the BLA for our hemophilia A product candidates. Turning to 2021 full-year guidance. We would like to reiterate the guidance we provided in our prior call. We continue to expect non-GAAP operating expenses which exclude estimated non-cash stock-based compensation expense of approximately $30 million to be in the range of approximately $255 million to $275 million for the year. I'll now turn it back to Sandy for closing remarks.

Thank you, Mark. I'd like to conclude by saying that we are pleased with the progress this quarter across our development and research organizations, and continue to believe we have the balance sheet strength to execute on our R&D milestones. Our manufacturing team continues to advance our in-house cell therapy manufacturing facilities, which we expect to be operational by the end of the year. We look forward to key milestones and catalysts by year-end, including initial data readouts on sickle cell and Fabry as well as a two-year update in hemophilia A. Operator, please open the line for questions.

Thank you. [Operator Instructions] Our first question comes from the line of Luca Issi from RBC. Your line is now open.

Perfect. Thanks for taking the question. This is Lisa on for Luca from RBC. Just wanted to ask though we saw yesterday that AvroBio will no longer be able to pursue an accelerated approval pathway for Fabry disease that they may need to run a Phase III trial head-to-head versus standard of care Fabrazyme. So just wondering what your reaction was to that news, and how does that influence your development strategy going forward for your gene therapy product? Thank you.

Thank you for your question. Each company has their individual discussion with the agency. Bettina, you've been working in Fabry for some time now. What was your take on that announcement?

Yes, sure. Sandy, thank you. Well, first of all, what we are doing is we're currently focusing on pressing full quarter ahead on enrolling the Fabry study with that Phase I/II STAAR study. And as you heard, Rob mentioned, we have those three patients and have enrolled the fourth patient who we hope to enroll and hope to dose soon. We are looking forward to sharing initial data readout in Q4. Now our study design includes collecting biomarker data, and as we've mentioned in the past as well, we will conduct kidney biopsies at the appropriate time. The study is currently unaffected by the recent regulatory updates that you're referencing. And for sure, we are engaging with the agency. And at this point, as you will appreciate it, that it's too early to share an update on that front.

Thank you, Bettina.

Great. Thanks for taking the questions.

Thank you. Our next question comes from the line of Maury Raycroft from Jefferies. Your line is now open.

Hi. This is [indiscernible] on for Maury Raycroft. For TX200, we noticed the trial initiated a bit earlier compared to the 4Q press release, what work needs to be done before the patient enrollment in the second half of 2021? Thanks.

Thank you for your question. Yes, we were pleased with the clinical operations group managing to initiate sites. I think they've done a remarkable job in the time of COVID. And now it's simply a matter of moving forward and enrolling patients and preparing for the dosing of the patient. This is the first time that we have dosed the patients with CAR-Treg. And so we're going to take care, be prudent, make sure we have the right patient and the right manufacturing process to be able to drive forward and do this well. And hopefully sure that CAR-Tregs potential is – matches everyone's excitement around this area to allow us to move into many autoimmune conditions.

Thank you.

Thank you. Our next question comes from the line of Geoff Meacham from Bank of America. Your line is now open.

Hey guys. It’s Aspen on for Geoff. Thanks for taking the questions. Just two quick ones from us. First of all, Sandy, I'd love to hear your thoughts on the current regulatory environment, specifically with respect to CBER. Any sort of reduced communication or are you feeling any sort of shift in mentality from the agency with any respect? And then secondly, just looking for a little bit more clarity on the Kite’s decision not to submit the IND. Just wanted to see if you had any additional feedback you can share with us. Thanks.

So let me take the more philosophical one and then I'll pass it on to Mark for the business discussion around Kite. I saw this week that Peter Marks was given an award for his service to advancing medicines and it feels totally appropriate. We have a great relationship with CBER. They are doing a difficult job and are flexible and thoughtful. I often get asked is has the regulatory environment got harder or they asking more? And I would reflect the other way around, the seven gene therapy is wonderful concept that we all are so excited by and know what we're meeting is the reality of what it takes to have a medicine approved. It's about ensuring your manufacturing is good, your self process is good, your science is good, the clinical trial is good, and it's not surprising that the – some of the excitement is now meeting reality. We take these stages extremely seriously [assignable]. We invest greatly in CMC regulatory interactions and manufacturing and are comfortable and confident that the agency hasn't changed its opinion. But I'll pass on to Mark now for Kite, Gilead. Mark, do you want to talk about that?

Sure. I mean, as Rob reiterated, Kite made the decision not to submit the 037 IND at this time. And the team is going to look a little bit closer to understand the potential path forward. This has been made in the context of the emerging early data from two competitors that were ahead of the 037 program. But also in the context of the data that Kite has on hand with their startup product, which the focus is really to drive something which would be a best-in-class alternative and would allow for an expansion of utilization of these products. And so the goal is to continue to apply Kite expertise in the development of oncology paired with our zinc finger platform and cell engineering capabilities to really look for opportunities to develop an advanced best-in-class oncology engineered cell therapies.

Thanks, guys.

Thank you. Our next question comes from the line of Yanan Zhu from Wells Fargo Securities. Your line is now open.

Hi. Thanks for taking my questions. I have a question regarding TX200. I see that it's enrolling in Belgium and Netherlands. I’m wondering, is there any difference in terms of the immunosuppression that is used for the renal transplant procedure, any difference between Europe and the U.S.? And if there is some difference, how would you also plan to open an IND in the U.S. to have a more relevant treatment procedure for the U.S. application? Thanks.

Thank you for your question. That's an interesting question because renal transplant and how you treat it is – differs a little from country-to-country. Bettina, would you feel comfortable to talk about it?

Yes, for sure. I mean, Sandy, you said that there are differences from country-to-country in addressing immunosuppression and renal transplant. We are – study as we've mentioned has recently initiated and we are enrolling in the first two countries. You've mentioned the Netherlands and Belgium. We do intend to open the study also in other countries, especially in other European countries. So this is something that we will hopefully be able to update you in the future.

I might also add. This is Rob Schott. There is often institution-to-institution differences in immunosuppressive therapies and you can even find differences within institutions between investigators. And we rely on the investigator judgment with respect to immunosuppression and therapy consequent following the TX200 therapy.

Got it. That's very helpful. And then maybe a follow-up on the C9ORF72 program. Could you talk about the potential advantages for using the zinc finger protein transcription factor versus using a gene therapy that delivers shRNA, for example, to knock down a target gene? Thank you.

Sure. We'd be happy to. Jason, can you help us with that one?

Sure, Sandy. I think the key difference is really about the platform technology, about our platform technology and our ability to fine tune the interaction of our zinc finger proteins with the designated target. So we have very fine control over that, and we have the ability to identify a zinc finger protein can accomplish what we set out to accomplish with the therapy and not have any off-target. And I think that there's a major difference between our ability to do that with zinc finger proteins and competitors.

And then beyond that from a clinical point of view, the RNA therapies seem to need to be given frequently. And we would hope that episomal expression of the transcription factor will give a long lasting effect. It seems to do it in animals. Until we get into humans, we will know for sure. But the promise that gives to patients, although once and done therapy is really important. These are dreadful diseases, and if we can address them with our transcription factor, we will fulfill our mission and promise.

Great. Thanks for the color.

Thank you. Our next question comes from the line of Gena Wang from Barclays. Your line is now open.

Hi. This is [indiscernible] on for Gena. Thanks for taking our questions. So I had a Fabry question. Since it looks like Gb3 reduction in kidney biopsies could serve as a surrogate endpoint, is it safe to assume like you are predominantly focused on recruiting patients with kidney defect? And do you think that FDA would require longer-term follow-up to monitor eGFR to grant a full approval based on the Fabrazyme update? Thanks.

Thank you for your question. The agency is doing its very best in my mind to make the pathway forward for Fabry clear and tractable. What they have said is Gb3 reduction in the kidney with the commitment to have a long-term eGFR benefit is a pathway to approval. And therefore, I think that understanding the effect on the kidney is important now. We are recruiting patients that are on and enzyme replacement therapy are naive and are pseudo naive in the current study. We are looking to show a biochemical effect and then we will move towards doing kidney biopsies. So I think simply the patient population is wide ranging from patients who already had a renal damage to those that are undamaged. And what my reading of the literature tells me is that this is an important consequence of the patients and the patients show renal damage from very early on. So in amongst that population that we're already recruiting, there will be patients with renal consequences. But let's wait, let's see the results at the end of the year and let's work sensible path forward.

Okay. Thanks for taking our questions.

Thank you. Our next question comes from the line of Ritu Baral from Cowen. Your line is now open.

Good afternoon, guys. Thanks for taking the questions. It's actually unique. I wanted to ask you about the rationale for picking HLA-A2. On Slide 11 of your corporate deck, you note that 21% to 26% of the transplanted – renally transplanted organs are HLA-A2 mismatched. First of all, I wanted to make sure that that 21% to 26% was renal? Was kidneys are not just organs in general? And second, in your comments today between MS and IBD, it seems like you were implying that you had sort of multiple targets per program picked auxiliary targets. I was wondering, if you also were thinking that had an auxiliary target for renal transplant and what proportion of the organs that might represent as well.

So I'm going to ask Jason to speak to this because Jason – we recruited someone that did some of the fundamental work on Tregs. But for the kidney transplant is about 20% mismatches. And that means that there is a substantial population of patients who are getting an HLA-A2 mismatch that CAR-Treg can be taken to by its GPS to find the HLA-A2 and activated [indiscernible], the other mismatches on the renal transplant. That's the beauty of this system. But Jason, do you want to talk about our general strategy for Tregs?

Sure. Thanks, Sandy. Yes. I mean, I think one of the things that's critical to keep in mind is that Sangamo is really, really pioneering this effort. The work that we're talking about is the first opportunity to test engineered CAR-Tregs in humans. And so the opportunity to use the A2 mismatch presented just a very kind of elegant way to approach the tissue targeting because we know that the A2 molecule will only be present on the transplanted kidney by virtue of the design of the trial. So that's the real reason for using the A2 approach. But I think one of the really exciting things about the CAR-Treg platform, especially in regards to the subject of your question, which is the antigens that we pick. The CAR targeting is that we are able to pick targets that as I highlighted are connected to the disease etiology, or simply just tissue specific targets. And that's a real advantage for us versus some of the problems that we see in the CAR-T field and oncology, we’re identifying targets that are unique to the cancer has become a real challenge. And so we’re able to either use something that is connected to the disease pathology or simply find something that is an antigen that's expressed in the tissue where we want the Tregs to localize to. And as we're gaining a huge amount of knowledge and understanding by advancing the TX200 program and we intend to build upon that knowledge in refining, which targets we pick for future programs. And so that's why we're keeping the opportunity to pivot to a different targets by advancing multiple targets in each of these limitations.

Got it. And just a quick follow-up on that and the STEADFAST study and following up on a previous question, as we think about the two secondary end points that you have on Slide 12, especially the ability to reduce immunosuppressive therapy. Given that the parent – the regimens, I guess, can vary from center to center. How will we quantify reductions in immunosuppressive therapy as part of this protocol, especially? And the reason I'm asking is it's my assumption that this might be the first needle to move. Is that a correct assumption? Or could acute graft rejection generate the first of the efficacy signals between those two bullets?

The advantage of modern medicine is patients rarely lose their kidney. The way they avoid that is with immunosuppression, which comes with all kinds of health consequences. This is a cutting edge state-of-the-art study that has to allow normal standard of care by the investigators. Of course, we would love everyone to do the same thing. But the study would not progress without that. And so we will gather the information from this, we'll gather information from renal biopsies. We'll understand about the Tregs. We'll watch what they do when – what happens when they reduced their immunosuppression. And we'll use that to design the next study and the next part of this program.

Got it. Thanks for taking the questions.

Thank you. Our next question comes from the line of Ben Burnett from Stifel. Your line is now open.

Hi. This is [Kelly Burris] on for Ben Burnett. Thanks for taking our questions. Just had one quick one about TX200. I was just wondering if you could provide any additional color about the starting doses that you may expect to see at the first look at data. And if you could provide any other color on it?

We haven't talked about the doses, which will be some – we're going to do three doses, and I know it will be some number of cells that we will talk about later, but we haven't said anything up to now.

Okay. Awesome. Thanks for taking our questions.

Thank you. Our next question comes from the line of Andreas Argyrides from Wedbush Securities. Your line is now open.

Good afternoon, and thank you for taking our question. This is Andreas on for Liana Moussatos. With regard to the ASGCT abstracts, have the respective partners selected a lead candidate yet from the library generated? And when might we see these assets enter the clinic? Thanks.

For our partner programs, I stem to partners to talk about them. We worked closely with them. We sit on steering committees with them. And so – but the rules of the relationship is it's for them to talk about it.

Okay. So how should we or investors look at the abstracts being presented from a scientific standpoint?

From a scientific standpoint, I think is very fair. And – but I want to assure you that our partners are excited by the progress of the CNS assets, and we look forward to speaking more about them in the future.

Okay. Thank you. I appreciate it.

Thank you. Our next question comes from the line of Debjit Chattopadhyay from Guggenheim Securities. Your line is now open.

Hi, guys. Thanks for taking my question. This is Evan on for Debjit. So we noticed from the Fabry clinical trials entry that the patients must have cornea verticillata, acroparesthesia and hidrosis or angiokeratomas to be included. So can you tell us any estimate of the percentage of Fabry patients with those symptoms and why those particular symptoms?

So Bettina, this feels like one for you.

Yes. Thank you, Sandy. So as you rightly point out clinical trials.gov, we have listed the inclusion and exclusion criteria for our Fabry STAAR study and the symptoms you listed, so cornea verticillata, acroparesthesia and hidrosis, angiokeratomas. These are symptoms that are classic of Fabry patients. They are – patients need to have at least one of those symptoms, if not more, to be able to be enrolled into this study. And that is to ensure that beyond the documented diagnosis of Fabry disease, we are enrolling patients who do have the underlying condition.

Okay. Great. Thank you.

Thank you. At this time, I'm showing no further questions. I would like to turn the call back over to Sandy Macrae, CEO for closing remarks.

Thank you so much. This is Aron. I'll take that. So thanks once again everyone for joining us today and for your questions. We look forward to keeping you updated on our future development. Have a great afternoon.

This concludes today's conference call. Thanks for participating. You may now disconnect.