Welcome to the Taysha Gene Therapies Third Quarter 2021 Financial Results and Corporate Update Conference Call. At this time, all participants are in a listen-only mode. Following management's prepared remarks; we will hold a brief question-and-answer session. As a reminder, this call is being recorded today, November 10, 2021. I will now turn the call over to Dr. Kimberly Lee, Senior Vice President of Corporate Communications and Investor Relations. Please go ahead.

Thank you. Good morning, and welcome to Taysha's third quarter 2021 financial results and corporate update conference call. Joining me on today's call are RA Session II, Taysha's President, CEO and Founder; Dr. Suyash Prasad, Chief Medical Officer and Head of R&D; and Kamran Alam, Chief Financial Officer. After our formal remarks, we will conduct a question-and-answer session and instructions will follow at that time. Earlier today, Taysha issued a press release announcing financial results for the third quarter ended September 30, 2021. A copy of this press release is available on the company's website and through our SEC filings. Please note that on today's call, we will be making forward-looking statements including statements relating to the safety and efficacy and the therapeutic and commercial potential of our investigational product candidates. These statements may include the expected timing and results of clinical trials for our product candidates. Our expectations regarding the data necessary to support regulatory approval of Taysha-120, and the regulatory status and market opportunity for those programs, as well as Taysha's manufacturing plans. This call may also continue forward-looking statements relating to Taysha's growth and future operating results, discovering development and product candidates, strategic alliances, and intellectual property, as well as matters that are not of historical facts or information. Various risks may cause Taysha's actual results to different materially from those stated or implied in such forward-looking statements. These risks include uncertainties related to the timing and results of clinical trials and pre-clinical studies of our product candidates are dependent upon strategic alliances and other third-party relationships, our ability to obtain patent protection for discoveries, limitations imposed by patents owned or controlled by third parties, and in requirements of substantial funding to conduct our research and development activities. For a list and a description of the risks and uncertainties that we face, please see the reports we have filed with the Securities and Exchange Commission. This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, November 10, 2021. Taysha undertakes no obligations to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call, except as maybe required by applicable securities laws. I'd now like to turn the call over to our President, CEO and Founder, RA Session II. RA?

Thanks, RA. We continue to advance our clinical and preclinical programs as well as strengthen our pipeline with complimentary therapeutic approaches to address high unmet needs across monogenic diseases of the CNS. At the end of the year approaches, we are highly anticipating multiple data readouts across several of our lead clinical programs. Let me start with TSHA-120, our most advanced clinical program for the treatment of ginixonaneuropathy or GAN. In December, we expect to report clinical safety and MFM32 functional data from the high dose cohort of 3.5x1014 total VG. These data are generated by our partners and collaborators of the NINDS under the leadership of theoretical [ph] study, Carsten Bönneman. As a reminder, the clinician rated MFM32 scale as a clinically validated and accepted regulatory endpoint that assesses motor function. To gauge with a successful outcome will look like based on the prospectively collected data on the natural history of GAN, there is a predictable decline in the MFM32 score of approximately eight points per year across all patients regardless of age. A four point change in MFM32 scale is considered clinically meaningful. To confirm modification of disease trajectory in comparison to the natural history study, we believe the high dose cohort should demonstrate continued slowing of disease progression, durability of effect and safety comparable to that which was achieved for the 1.2x1014 and the 1.8x1014 total VG doses. Regarding safety recall that we have up to six years of clinical safety data demonstrates no drug-related serious adverse events, no signs of acute or subacute inflammation, no sudden sensory changes and no persistent elevation of transaminases. And also with regards to safety and preclinical studies using gangliosidosis TSHA-120 improved histopathological appearance of the dose root ganglia, which is a known complication of GAN, levered by supporting reduction in…

Thank you, Suyash. This morning, I will discuss key aspects of our third quarter 2021 financial results. More details can be found in our Form 10-Q, which will be filed with the SEC shortly. As indicated in our press release today, R&D expenses were $39.5 million for the three months ended September 30, 2021, compared to $11.1 million for the three months ended September 30, 2020. The $28.4 million increase was primarily attributable to an increase of $14.5 million of expenses incurred in research and development manufacturing, and other raw material purchases, which included cGMP manufacturing batches produced by Catalent and UT Southwestern. There was an increase in employee compensation expenses of $10.7 million, which included $1.9 million of non-cash stock-based compensation, and $4.9 million in third-party research and development expenses, which includes clinical trial CRO activities, GLP toxicology studies, and consulting for regulatory and clinical studies. This was partially offset by a decrease in licensing fees of $1.7 million. G&A expenses were $11.2 million for the three months ended September 30, 2021, compared to a $4.0 million for three months ended September 30, 2020. The increase of approximately $7.2 million was primarily attributable to $4.3 million of incremental compensation expense, which included $1.8 million of non-cash stock-based compensation. There was an increase of $2.9 million, mainly in professional fees related to legal, insurance, investor relations, communication, accounting, personnel recruiting, market research, and patient advocacy activities. Net loss for the three months ended September 30, 2021, was $51.2 million or $1.35 per share as compared to a net loss of $15 million or a $1.28 per share for the three months ended September 30, 2020. As of September 30, 2021, Taysha had $188.8 million in cash and cash equivalent. And with that, I will hand the call back to RA.

I wonder if RA has dropped off for some reason. This is Suyash here.

Oh, my apologies. Go ahead, RA.

Thank you. [Operator Instructions]. Our first question comes from the line of Joon Lee with Truist Securities. Please proceed with your question.

Hi, thanks for taking our questions and congrats on the impressive accomplishment in such a short period of time. For the GM2 you seem to be implying that you may be able to submit for approval with existing data from the Canadian site. And if so, what jurisdiction do you think would be most amenable to this, and can you give us some historic proxy where something like this have happened and I have a follow-up?

Yes, thanks, RA, and thanks for the question, Joon. And yes, we're talking through regulatory strategy on an ongoing basis. In the past four months -- four to six months, we've had nine regulatory meetings across our portfolio of programs. And these are multiple meetings with the U.S. and several other ex-U.S. agencies. So we're really getting a lot of real time information on the right approach for pathway to approval. As RA has already said, we've been very pleased, actually, of how we've been able to identify patients for the Canadian GM2 study. There's been some delays that relates to COVID. But essentially, we've screened large numbers of patients that tell us actually, there's a large number of GM2 patients out there. Because things are going so well in Canada, we are talking about the fact, yes, perhaps we could just file ex-U.S. initially and have the IND open and then file principally with data from other countries, as opposed to from the U.S. And as RA says it is a global study. So what I felt is if there are U.S. patients, we could actually send them to Canada for dosing. So there's multiple options here. In terms of specific examples, and I've worked on a couple previously, in particular environment where our focus was much more on Europe initially followed by the U.S. later. I think one springs to mind I think the CLN2 Brineura program was one where the study starts in the ex-U.S. And then the filing happened in Europe prior to the U.S. from my recollection, that's true. But there are several examples why this has happened. So yes, we continue to value options. Like this, we'll open an IND in the U.S. for GM2 at some point, but things are going still well in Canada, we decided to focus our time and initiate an attention on continuing enrollment in gathering clinical data in Canada.

Great. Looking forward to the data in December. And a second question and the last question, for TSHA-120 in GAN, which you have very strong data, six, eight years' worth of data. Are the materials used in the investigational study undergo the same GMP and QA process as materials you're producing in your GMP facilities? And if they are different, what would you need to do to satisfy the FDA requirements, that they are equivalent and be able to commercialize or submit for approval with existing data? Thank you.

I think the only thing I'll add really, we spend a lot of time and energy very early on ensuring that we are able to characterize product in terms of contaminants in terms of collected captured ratios. We bring that learnings. We bring those learnings through to our GAN program as well. And there's a very real meaningful example where actually two weeks ago that the team were over at the CDMO part, who's manufacturing the drug for the -- manufacture the drug clinically, and will also manufacture drug through into the commercialized process. So it's Fred Porter, our Chief Technical Officer, Mish Gerhart, our Head of Regulatory and a team of about 10 people spent a full week at the facility going through all the details and looking through all the processes and ensuring that things were absolutely as pristine as possible. So we feel very confident that the clinical material -- that the material used in the clinical studies is going to be absolutely equivalent to what we're going to be using going forward in the GAN program commercially. So, yes. Great question Joon, but we're very comfortable with the approach here.

Got it. Well, looking forward to all the data in December, thanks for the answers. Thank you.

Thank you. Our next question comes from the line of Gil Blum with Needham and Company. Please proceed with your question.

Good morning and thank you for taking our questions. It's a bit of a follow-up on the previous discussion. So it actually makes the conceptual sense that considering you guys are using a production method commercially used to make your AAV9 that it would be translatable across your platform, but they're still variance using different genes in each program. Do you guys expect the FDA will be looking for a bridging study of any kind? I mean this is the across programs now, right. So you could have it for GAN, you could have it for CLN7, you could have it for GM2. It seems that you make really long headways with the initial studies and are looking to kind of transfer hopefully into commercial products. Thank you.

Yes. Thanks. Thanks, RA. And yes, thanks for the question, Gill. And I think RA is quite right. The GAN is a little bit of an outlier, because GAN wasn't in our hand in the earlier parts of the clinical trials and it came into our hands and so we're having to adapt somewhat, which is very appropriate. And as I say, the team visited the CDMO a couple of weeks ago. We feel very comfortable with that. , : And once again, we know that for CMC methods, we have to do the right thing as early as possible. And we try as hard as we can. We're successful for the vast majority of our programs. Once again, GAN is a bit of an outlier, but the vast majority of our programs to getting commercial grade material ready, definitely by the time of the pivotal parts, when you study. For the most part before we start any clinical study at all, and ideally in the actual IND-enabling preclinical study that's really when we want to have that's our aspiration to make sure we have a commercial grade product at that early time point, does that it just makes the whole regulatory process go much smoother from a CMC perspective.

Thank you for a very complete answer on this question. Maybe a quick scientific question of course GM2 program. Is there any differences between say measured and CSF guarantee you're seeing a high-level on one, different than the other or better than the other? Thank you.

Yes. Thanks, RA. Gil, this is a really perceptive question, because I think it's important to understand the expectations of what we're going to see from a HEXA perspective. RA is quite right. There is a lot known about HEXA that comes off GM2 gangliosidosis that's been done historically; disease was described in the late 1800s by William Tao ophthalmologist. The enzyme was identified in 1969 and there's been many, many screening programs. So we have a really good understanding of HEXA levels in the plasma. Having said that, we wanted to not only look at the plasma levels, we also want to look at CSF levels because to us ensure simply if we're trying to transduce brain cells, we should also see an elevation of HEXA in the CSF. And we believe that that will actually reflect what's happening in the brain a little more than the plasma activity. So that's what we've accounted these days and we'll be sharing data on both towards the end of the year. Now RA is quite correct also that once we hit 5% levels of enzyme in the serum in terms of the clinical phenotype, those are adult patients with GM2 gangliosidosis. There are some cognitive deficits and movement disorder, but they haven't generally normal lifespan. So if we change the HEXA level from less than 0.01% for an infantile to over 5%, then we anticipate that that will dramatically modify the clinical phenotype. So that's our bar. In terms of what levels we might see in the CSF, we're assuming 5% as well, but actually, maybe less and maybe a little bit less. It's my guess that the CSF levels of HEXA may actually be a little lower than the plasma -- plasma versus HEXA. But as I say, we'll be presenting both plasma HEXA levels and CSF levels on HEXA; we've got CSF working very nicely within the preventive outdated towards the end of the year.

Thank you. Our next question comes from the line of Laura Chico with Wedbush Securities. Please proceed with your question.

Hey, good morning, guys. Thanks very much for taking the questions. I just have two small ones. So first on the 120 program, could you just discuss a little bit more about the timing after the January meeting? I guess I'm just trying to better understand when we might have a little bit more clarity on the U.S. regulatory path for 120. Apologies if I missed that. And then kind of related to the earlier commentary. It sounds like the base case, we should have in our estimates is really assuming ex-U.S. regions perceived the U.S. and I just wanted to make sure that that is the kind of working base case assumption right now. Last one, just on 120 RA, I think you mentioned second half would be released with commercial grade material for 120. I just wanted to understand, are there any remaining headwinds or issues that could perhaps impact timing there? Thank you guys.

Yes, I will do. And just give a bit of color, Laura, to the just some of the operational aspects of what we're trying to on the GAN program. We've got a great data package for GAN as we've already mentioned this great match race, so the dose response data clear stabilization of disease at medium low, medium high doses, and the high dose yet to come, long-term safety durability, and efficacy. And so we're really feeling confident and good about our discussions with regulators. One of the practical challenges frankly is that the regulator is just very, very busy. In fact we're looking forward to having our 10th regulation meeting this month, but the regulator agency in question actually contacted us and said, hey, look, we're really so really busy. We're going to have to push you out to January. So this is on a different program, but it just that that very rarely happens. And so it just gives us a sense of how busy the agencies are at the moment, generally with a whole bunch of COVID stuff. So we're putting in requests for meetings, but not actually getting the meeting for three, four, five months, down the pike. So it's a little bit of an operational challenge that frankly thoughts I've got to say, we got our first meeting on January, we'll anticipate with subsequent meetings shortly thereafter. The likelihood is for; we may also separate out really partly for the timing CMC discussions with clinical data discussions. And I think that's probably how we'll plan the cadence with some of the agencies, especially those that have more focus on CMC and this we're already touched on before the CMC is something that we want to make sure we explain our process, our situation very well.…

Thank you. We would just like to remind everyone to please ask one question. Thank you so much. Our next question comes from the line of Salveen Richter with Goldman Sachs. Please proceed with your question. Q –Elizabeth Webster: Hey, good morning guys and thanks for taking our question. This is Elizabeth on for Salveen. So just two from us, and one would be you touched upon the different properties expected between the first and the next-generation construct for the CLN7 program. And maybe if you could just remind us on the specific molecular level or structural differences between the two? And then quickly on the second question just touching on patients, but first the data disclosure, given you have several data readouts towards December and then into next year. And then what venue or potential disclosure format those could take. Thank you,

Thank you. Our next question comes from the line of Mike Ulz with Morgan Stanley. Please proceed with your question.

Hey, guys, thanks for taking the question. Maybe a question on 120 in GAN, around the upcoming data in December for the highest dose. Maybe you can just talk about how you're thinking about stuff the dose going forward. For example, if you see in the highest dose sort of continued stability, what does that mean for you in terms of the optimal dose? Thanks.

Sure. Yes, so as we've already -- as you're already aware, we've got a nice dose response across the three dose groups that we've shared previously. So the 3.5E13 total VG with a low dose, which was the more the safety dose, the 1.2E14, the medium low dose and the 1.8E14 medium high dose really showed disease stabilization. So the ongoing decline of eight points per year on the MFM32 was halted with both those doses. My guess is that the high dose is going to show at least that degree of improvement that degree of dose stabilization, which is clinically meaningful. As we know, a 4-point change in MFM32 is deemed to be a clinically meaningful change. So the fact that we improve disease by 8-points per year, which translates to 16-points over two years, 24-points over three years, is really very meaningful for these patients and families. And if we identify patients earlier, and we treat them earlier, when they're at a higher level of functioning, that's going to be probably the most meaningful thing we can do for these patients or families. And as you already heard on the call this morning, and we issued in press release three or four weeks ago, on our partnership with GeneDX, where we now have the mutation for GAN, the GAN mutation now on many of these hereditary neuropathy screening panels. And the costs are covered. So actually presented that the Charcot-Marie-Tooth Association meeting last weekend and talked about this screening approach. And there's a lot of excitement -- a lot of interest from patients who have different forms of axonal neuropathy that have been diagnosed as Charcot-Marie-Tooth Type 2 wanting to get screened in case they have the GAN mutation and would therefore be eligible for gene therapy construct.…

Thank you. Our next question comes from the line of Kevin DeGeeter with Oppenheimer. Please proceed with your question.

Hey guys, thanks for taking my questions. I mean just maybe two quick ones on GM2. Appreciate the updated perspective on how you're thinking about regulatory path, I guess, with that in mind. How many patients should we expect to see an update on in December to kind of appreciate kind of where you are from building a patient data safety base? And then as I think about duration of follow-up, from a clinical perspective, but I guess for this discussion from a regulatory perspective, what duration you'll follow-up on HEXA enzyme expression do you think you'll need to be able to gather to have robust discussions with regulators. Thanks.

Yes. This is a really good question, Kevin and I think that the way to think about it is take a step back and just anticipate the cadence of what might happen. So we're going to give the drug intrathecally. It travels to the brain, the caption into the brain cell, the neuron, the DNA pops out, starts producing the bi-systemic HEX alpha sub-units, beta sub-units, they combine and starts breaking down GM2 ganglioside. Now you're going to get maximal transgene expression probably three to four weeks after dosing, and then you should get maximum production of enzyme HEXA shortly thereafter. So our guess is that at the one month time point, and we take a CSF sample at one month, we take one at three months, we take one at six months, and then we take one at 12 months for the first year. My guess is that the HEXA level in the CSF will go up at the one-month time point, but probably will not reach maximum levels, by the three-month time point, my expectation is it will reach maximum levels. In parallel with that in -- with regard to the earlier discussion we had, you will also see an elevation of HEXA levels in plasma, which is where we have more experience, but it's probably less relevant for a treatment that transduces brain cells. My guess is that you're going to see persistently elevated levels patterns, six month time point in the CSF and persistently elevated levels at the 12-month time point in the CSF. And I don't think you're going to see any diminution activity over time. And the reason for this is that -- is that once you've trans used a brain style, it should stay trans used and still be producing transgene in perpetuity,…

Thank you. Our next question is coming from the line of Yun Zhong with BTIG. Please proceed with your question.

Hi, good morning. Thanks very much for taking the question. This is a follow-up question on the CLN7 program. Just wanted to confirm, have you had any discussion with the FDA to confirm that it will be possible to move into pivotal study, which the second-generation construct and given that there seems to be quite a lot of components you're going to change from generation one to generation two. How do you feel comfortable that some quick assays will allow you to find the optimal doses and feel comfortable still with the safety going into pivotal study? Thank you.

Sure. And I think that the -- we've spent some considerable time talking about modifications to the construct. And I use the phrase modification, because they're relatively minor changes that we think will have some reasonable impact. And we won't go into the details of the changes that where we're proposing. But suffice it to say is optimizing the construct where we think there's going to be -- to a degree of benefit from an efficacy perspective, a benefit from a safety perspective, and a benefit from manufacturability perspective. But we're very, very mindful, but we don't want to change it so much that it becomes a whole new package. We are very aware of what we can change and what we can't change to allow us to reference the first-generation construct from a similarity perspective with minimal bridging work. It's likely we're going to need to some bridging work in the animal. But it's likely a very simple study, perhaps a combined mouse model short duration pharmacology/toxicology study. But it's -- once again, we're planning to make minimal changes in line with our ability to reference the earlier first-generation construct.

Thank you. Our next question comes from the line of Eun Yang with Jefferies. Please proceed with your question.

Hi, this is Nancy [ph] on for Eun. Thanks for taking our questions. I was just curious on how is the progress on ratio of anti-capsids during the AAV9 production and what the current ratio of anti-to package capsid is, and mostly on what the range of this is between your different indications? Thank you.

I'll comment. Yes, this is a really excellent question. And I think always weaving in some of what the importance here is, and it's really about the so what factor. What does the presence of anti-capsid mean? Now I've been a firm, firm believer for many years, and I think the field is moving in this direction that we have to remove as much anti-capsid as possible. A lot of manufacturers find this hard to do without sacrificing yields tremendously. And so there's sometimes reluctance to try and remove the anti-capsid. From my perspective, looking at the patient, anti-capsid just add unnecessary borrow load, which then feeds into some of the safety issues that we've seen and people are concerned about in the AAV gene therapy space. Now right now I've been talking about this at length and always quite as well as our intent is to have at least 90% full. We do better than that. Significantly better from that for some of our programs, which I'm very pleased about as the physician overseeing the safety of these patients. And we -- I really appreciate the fact that's RA and our full alignment, that we will sacrifice yield in order to make sure we get pristine pure highly purified product with as little anti-capsid as possible. So I think it's a really important question. We work closely with Fred, our Chief Technical Officer to try and make sure that we have very high quality products and we've got good characterization screens early on. But our intent yes is to inject patients with less than 10% and see greater than 90% for our products.

Thank you. Our next question comes from the line of Kristen Kluska with Cantor Fitzgerald. Please proceed with your question.

Hi, good morning, everybody. Thanks for taking the questions. Just wanted to ask as you look at the clinical trials you anticipate running next year, how you're thinking about the cadence in terms of trial enrollment, given all of these different indications, have different prevalences?

Yes. Thank you, Kristen. Great question. It's a little different from program to program. There's a few common themes I would say. First of all, we talked a lot about our platform approach AAV9 anti-delivery HEK293, but the platform approach actually works in many other ways. One of which is frankly that the vast majority of clinicians we deal with are pediatric, metabolic or neurology experts. GM2 sale in one, sale in Southern Rett is generally looked after similar physicians. And so we a lot of the touch points in terms of finding investigators are similar. So I think that's one thing that helps us in terms of recruitment. I think the other thing that helps us is where -- for the diseases where there are more the ultra-rare population. So we're thinking the diseases would have 1,000 patients prevalent for example. We plan to have one or two sites in the U.S. and one or two sites ex-U.S. and then transport patients from around the world to those sites. So we're focusing heavily on that, the ability to transport patients from other countries to the U.S. or to Canada or to Europe. And that's worked very well for our GM2 program. We only have one site for GM2 program currently. In Canada, we get a list of patients and the patients that have been enrolled and screened for the study come from all over the world. It's a little different for diseases that are less rare. So disease like Rett where you're thinking 25,000 patients in the U.S. and Europe recruits and enrollment is a little different. It's a little easier, because patient -- there's more patients and they are generally tend to congregate the centers of excellence where clinicians will have 30, 40, 50 patients with Rett syndrome…

Thank you. Our next question comes from the line of Raju Prasad with William Blair. Please proceed with your question.

Thanks for taking the question. Just curious to know on the GDX deal just how many patients do you anticipate finding with kind of a genetic marker. And do you have any kind of initial thoughts there? And then, second on the GM2 program, it seems like 5% is the benchmark here for biomarker, but is there any initial clinical measures that we could see moving to kind of show that there's a clinical benefit that's being changed by this increase in enzyme activity? Thanks.

Yes, obviously, it seems as though natural history with a 5% kind of the biomarker thresholds for GM2, just curious to know the timeline for when that may translate over into maybe early clinical measure of benefit?

Sure. Yes, I just make one comment on the GAN Charcot-Marie-Tooth discussion, because I actually spoke to the Charcot-Marie-Tooth Association meeting last weekend, and sat on a panel and got to meet many patients and families. And it was clear, it's always point that the many individuals the Charcot-Marie-Tooth only have a clinical diagnosis that that, there are many adults there who were diagnosed with the disease and having that mutation analysis or genetic testing. So there's a large pool of patients, I think, who will really take advantage of this GDX partnership that we've created. And our expectation is that a significant number of patients will be found, but shouldn't that. Just based on the subjective discussions I had last weekend, I think that that seems very real and meaningful. With regards to GM2, it's a good question, I talked to the cadence of how I expect enzyme levels to modify and improve over time. I think with the clinical improvements, I think it's going to take longer to see clinical improvements. And it may be more stabilization of disease progression than improvements. And the reason I say this is that GM2 is a very rapidly progressive, destructive disease. And what happens after physiologically is that you get the accumulation of GM2 ganglioside and the lysosomes of the cells for less and swell a rupture [indiscernible] acidic enzymatic contents, and actually cause damage to the neurons. Initially, in inflammatory process, but then it results in fibrosis, death of the neuron. And once you've lost a neuron, you don't get it back. So I think, if a patient is significantly affected, and they've lost a lot of neurons, you're going to be able to produce the enzyme HEXA stop additional damage. And you may get some resolution of some of…

Thank you. Our next question comes from the line of Silvan Tuerkcan with JMP Securities. Please proceed with your question.

Yes, good morning, and thanks for taking my question. Maybe you can just give us a big picture view about your ability to manage all of these programs as the pipeline expands so rapidly, especially next year with five, six trials and regulatory discussions in detail into potential planning at the end of the year. What about your cash and manpower to maintain all of that and you expect there will be maybe some attritional, deeper prioritization or potentially some partnerships, your thoughts that will be great. Thank you.

Thank you. There are no further questions. I will now turn the call back over to Mr. Session for additional or closing remarks.

Ladies and gentlemen, this concludes today's presentation. Thank you once again for your participation. You may now disconnect.