Good morning. Welcome to Taysha Gene Therapies’ First Quarter 2022 Financial Results and Corporate Update Conference Call. At this time, all participants are in 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 May 16, 2022. I will now turn the call over to Dr. Kimberly Lee, Chief Corporate Affairs Officer. Please go ahead.

Good morning and welcome to Taysha’s first quarter 2022 financial results and corporate update conference call. Joining me on today’s call are RA Session II, Taysha’s President, Founder, and CEO; 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 first quarter ended March 31, 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 a product candidate. Our expectations regarding the data necessary to support regulatory approval of TSHA-120 and the regulatory status and market opportunity for those programs as well as Taysha’s manufacturing plans. This call may also contain 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 differ 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 preclinical 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 the requirements of successful funding to conduct our research and development activities. For a list and 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 today of this live broadcast, May 16, 2022. Taysha undertakes no obligation 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 law. I would now like to turn the call over to our President, Founder and CEO, RA Session II. RA?

Thanks, RA. As RA noted, we have made significant recent progress and its launch in our clinical programs for GAN and Rett syndrome and expect exciting milestones throughout the remainder of the year. I will begin with Rett syndrome. TSHA-102 is a transgene for MECP2, which is a protein essential for neuronal development and function. The challenge in gene replacement therapy of MECP2 is finding the appropriate balance of sufficient physiological expression to correct the deficiency, whilst also avoiding overexpression and the associated toxicity. To do this, TSHA-102 regulates the expression of MECP2 using the novel microRNA responsive auto-regulatory elements platform known as miRARE that is exclusively licensed to Taysha and developed by Drs. Sarah Sinnett and Steven Gray of UT Southwestern Medical Center. miRARE provides sophisticated regulation of transgene expression on a cell-by-cell basis ensuring controlled expression that avoids excessive levels of MECP2. We recently initiated clinical development of TSHA-102 under an approved CTA by Health Canada. In further support of this promising program, we presented positive IND CTA enabling preclinical data at the International Rett Syndrome Foundation Scientific Conference and ASCEND Rett Syndrome National Patient Advocacy Summit. These data supported the CTA acceptance, including a pharmacology study in Rett knockout mice, assessing the efficacy of TSHA-102 and a 6-month GLP toxicology study in non-human primates exploring the safety by distribution and mechanism of action of TSHA-102. Collectively, these preclinical results confirm the ability of TSHA-102 to regulate transgene expressions within appropriate physiological levels. This week, we will have a prevalence of the 25th Annual Meeting of the American Society of Gene & Cell Therapy, or ASGCT, while we will be presenting the safety and by distribution data in NHPs as well as safety data in rats. These presentations will further support the ability of our miRARE platform to…

Thank you, Suyash. This morning, I will discuss key aspects of our financial results for the first quarter ended on March 31, 2022. 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, research and development expenses were $37.8 million for the 3 months ended March 31, 2022 compared to $23.9 million for the 3 months ended March 31, 2021. The $13.9 million increase was primarily attributable to an increase of $9.3 million in employee compensation, which included $2.2 million of severance and one-time termination costs in connection with the strategic reprioritization of programs completed in March 2022 and $1 million of non-cash stock-based compensation. Additionally, in the 3 months ended March 31, 2022, we incurred an increase of $2.9 million of expenses in research and development, manufacturing and other raw material purchases. We also incurred an increase of $1.7 million in third-party research and development consulting fees primarily related to GLP toxicology studies and clinical study activities. General and administrative expenses were $11.5 million for the 3 months ended March 31, 2022 compared to $8.2 million for the 3 months ended March 31, 2021. The increase of approximately $3.3 million was primarily attributable to $2.9 million of incremental compensation expense, which included $0.4 million of severance and one-time termination costs and $0.7 million of non-cash stock-based compensation. We also incurred an increase of $0.4 million in professional fees related to insurance, Investor Relations, communications, accounting and market research. Net loss for the 3 months ended March 31, 2022 was $50.1 million or $1.31 per share as compared to a net loss of $32 million or $0.87 per share for the 3 months ended March 31, 2021. As of March 31, 2022, Taysha had $96.6 million in cash and cash equivalents. This cash balance excludes $12 million in gross proceeds generated from the sale of common shares under our existing at-the-market facility or ATM in April. Current cash and cash equivalents along with full access to our existing term loan facility, is expected to fund operating expenses and capital requirements into the fourth quarter of 2023. And with that, I will hand the call back to RA.

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

Hi, good morning and thank you for taking my question. This is [indiscernible] on for Joon. So what is the probability by which you think FDA might ask you to have efficacy data on new patients using commercial grade material and how long would you take – would you think it takes to provide such data? Thank you.

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

Good morning and thanks for taking our question. We have another quick one on TSHA-120. So what more is there to do on your commercial grade product, what more things do you need to do there? And maybe you can give us an idea of how many patients can be treated with this batch? Thank you.

No, I think I would just echo the fact that the batches made, there was plenty of product majors or high yielding run and release testing is underway looking at the characterization of the product and it’s all looking very promising thus far. RA is quite correct, the only thing we are doing is outstanding is to finalize the potency assay. And just to remind you, potency assay essentially exists to demonstrate that the molecule that we are administering closely mimics and what’s effectively in the clinical settings it does in the lab setting and every lot needs to be tested, there is predefined acceptance character that need to be met. And the FDA and the regulators are pretty keen to ensure obviously the product we make on an ongoing basis is consistent and highly appropriate level of quality. And as RA said, we have made a lot of progress in finalizing that potency assay. So, everything is looking great. We are release testing is of the way and the drug is going to be available to pre-treating patients imminently.

Thank you. Our next question comes from the line of Salveen Richter with Goldman Sachs. Please proceed with your question.

Hey, good morning, guys and thank you for taking our question. This is Elizabeth on for Salveen. Maybe just switching over to Rett, if you could comment on the nature of the first clinical data we expect to see and how many patients we can expect to see data from? And then a second one from us are, what kind of assumptions have been baked into the 4Q ‘23 cash runway guidance? Thank you.

Sure. Let me take the question about the clinical trial, then Kamran and RA can handle the second question. So with regard to the Rett clinical trial, this is a trial in adult females with Rett syndrome. To remind you, we just felt given – just given the concerns about potential overexpression, which we show with actually downregulate very nicely in our in RMHP data, we still wanted to be a little bit conservative. And so we are starting off in adults and the plan will be to move into children, pediatric females with a Rett at some point thereafter and then we want to plan a small study in boys, the very rare population of boys with Rett shortly thereafter. Now, in terms of expectations with regard to what we are going to have coming out of the clinical trial data of the adult study, which we anticipate sharing data from by the end of the year, the likelihood is going to be safety data and to have some preliminary efficacy data, we are not sure at the moment. We will, as is the case for these first enhanced studies with these innovative products, they have to target those things. We can’t go several patients all at once. We have to dose one patient, leave with a period of time and then dose the second patient after a DMC review and then leave with a period of time for dosing the next patients. So my guess is going to be a small number of patients safety data by the end of this year potentially some preliminary efficacy data if we are starting to see some early signs of that, but I think that’s why we are focusing on clinical trial at the moment. With regard to the assumptions, I’ll let RA and Kamran take that question.

Sure and thanks, Liz for the question. I was actually talking on mute. So just to reiterate what Suyash mentioned, we are quite excited about the Rett data, the preclinical datasets that supports the CTA, and again, are really excited about what this means to the Rett community being the first and only gene therapy, actually in clinical development for Rett syndrome. And I think just to echo what Suyash mentioned, it will really be on the totality of data, the amount of endpoints that are being collected are immense. Both from physician reported Rett syndrome outcomes, patient reported outcomes, respiratory measures, obviously, some neurodevelopmental measures as well as movement. So it’s really going to be a whole host of endpoints that will share including safety and safety is going to be probably one of the most important ones because there’s always this notion around overexpression and the data from our NHP study or NHP talks study not only demonstrated the safety of our construct at four – doses up to fourfold above what the starting dose will be in the clinical setting, but also proof of mechanism the ability to down regulate the expression of MECP2 in the presence of wild type in the presence of wild type MECP2 and so again, for us, it’s quite exciting. But certainly, this is one of the reasons why we decided to start into adults. So I would probably characterize it. Similarly the way that Suyash did and it’ll be on the totality of data, it’ll be safety with some preliminary efficacy in there. From an assumption perspective on cash runway, the way that we’re thinking about this is we have with the full drawdown of our current term loan facility from Silicon Valley Bank, we have the ability to be able…

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

Hey, great, thanks for taking our questions. Just on again regulatory update, RA, can you comment on your confidence sort of that, that mid 2022 update timeline? I guess sort of underlying this question is, is it reasonable to conclude they’ve had the necessary meetings with FDA and other regulatory agencies are waiting for feedback at this point? Are there kind of open scheduling components that could impact that timeline and cause some uncertainty that?

Thank you. Our next question comes from the line of Jack Allen with Baird. Please proceed with your question.

Hi, thank you so much for taking the questions and congratulations on all progress. I wanted to shift gears back to Rett really briefly and talk about the dose there. I know you mentioned that you’re starting at 5V14 total VG and then moving up to 1E15. And that, I guess the preclinical package showed safety at 4x the first dose, I was just curious was there a dose in the preclinical package where you did see tolerability issues and how much coverage do you think you have to dose escalate as we move through the study based on the existing preclinical package?

Yes, hi, Jack. Thanks for the question. So it’s a really important question. The those select for the clinical trial for a gene therapy study, getting the dose Rett the first time is really important, because you’ve got to make sure you give enough drug to make sure the drugs are effective, but also make sure that there’s no safety or tolerability issues, because once you’ve given gene therapy, drugs, you can’t take it away again. So it’s a really critical decision that needs to be made. And in particular, for Rett, where there is this risk of over expression toxicity. So you have to get the amount of protein being produced appropriate within the appropriate physiological limits enough to make sure you’re having efficacy, but not so much protein that it causes toxic side effects. Because of that, we actually did a very, very disciplined preclinical package, which included a mouse pharmacology study. So a mouse model pharmacology study, we did a Rett toxicology study, we did an NHP toxicology study, all of the studies were very extensive and very comprehensive. The mouse study was over 250 mice, the Rett study was over 120 rats, NHP study was 24 NHPs. And the mouse pharmacology study is where you look for a dose that’s going to be efficacious. And we’re able to – we were able to identify that very clearly in terms of demonstrating enough drug causing an improvement in survival, motor assessments, respiratory assessments and other assessments. So the 5V14 total VG dose is above that level. And then on the other end, both in the Rett talks, and the NHP tops, we tested doses up to an equivalent of 2V15 total VG human equivalents that’s fourfold over the starting dose. And to answer your question, specifically, there…

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

Hi. Thank you very much for taking the question. This is actually a follow-up question on just what you said, just now Suyash. So, on Rett syndrome, has anyone looked at comparability between non-human primates and human patients in terms of biodistribution? And also given that this is not cross correction to be expected? So, are there any data to suggest the transduction efficiency, or do you have an estimate on how many cells will need to be transduced to see reasonable efficacy?

Two very good questions. So, the first question was about the translatability of NHP biodistribution to human. It’s a good question. No one has done it specifically in Rett. What we have done is we have shown very nice biodistribution with our Rett program with an intrathecal dose into an NHP, which is of course smaller than the human being. But the anatomy is very similar. And it’s probably the best corollary looking at blood sugar in any animal model to the human. And we get really nice biodistribution throughout the brain and the spinal cord with the intrathecal dose of injection. Now, in the human setting, the only way to really ascertain biodistribution is in a sad situation if the patient was to pass away and to look at DNA and RNA, and protein in that individual. And that did happen very early on in one of the GAN patients. One of the low dose GAN patients who sadly passed away through progression of disease, this data has been presented by Carson Palmer and Steven Gray at the ASGCT meeting a few years ago. And they showed that with an intrathecal dose of AAV9 gene therapy for GAN. You actually got nice biodistribution, although it’s a low level, but it was a low dose throughout all target organs, tissues. And the other thing I will say from what we learned from the GAN program, and don’t forget GAN AAV9 is HEK293, and intrathecally delivered, so lots of similarities to the Rett program. The other thing I will say about GAN is, is that we have demonstrated more recently in our January presentation that we see improvements in the peripheral nerves, in the nerve biopsies. Now, these are nerve biopsies that are performed in the radial superficial nerve, which is…

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

Hey. Good morning, guys. Thanks for taking the question. I wanted to circle back with regards to the spend, I am wondering if you can offer a little bit more clarity on perhaps the breakdown between R&D and G&A. And RA, I think you made an earlier comment too, about kind of exploring additional channels for monetization, just wondering if you could kind of expand on that a little bit. Thanks guys.

Yes. Sure. Happy to. Thanks RA and thanks for the question, Laura. So, over 75% of our operating expenses are R&D related. And as RA mentioned, because of their strategic pipeline prioritization efforts, we will be able to reduce that R&D expense burn significantly over the next coming quarters as a result of pausing research and development activities on our preclinical programs, as well as significant reduction in our CMC expenses. Ultimately, as a reminder, we conducted six GMP batches last year, some of which were completed in Q1 of this year in terms of product release. And we are only doing GMP manufacturing on our GAN program this year. So, you can expect a significant reduction in our CMC expense year-over-year and in subsequent quarters as a result. So, again, a lot of a lot of nice work to really focus our resources and our efforts primarily on of course, GAN.

Thank you. Our next question comes from line of Yanan Zhu with Wells Fargo. Please proceed with your question.

Hi. Thanks for taking my questions. A couple on the Rett syndrome clinical trial, what is the waiting period for safety observation, once patient one is dosed? And how could – how would you ascertain whether there is MECP2 overexpression associated toxicity given that the MECP2 duplication syndrome share a lot of the same manifestations with Rett syndrome? Thank you.

Sure. So, the staggering specifically is eight weeks. So, after patient is dosed for a review of the eight week time point, and discussions with DMC will then show with the absence of any safety issues, we will then go ahead and dose the next patient. But that’s between patients one or two as time progresses, the staggering changes in the clinical trial course. And we do less staggering as the study progresses. Specifically, with regard to signs of over-expression toxicity, it’s a good question. And it’s one we have discussed at length, both with regulators and with key opinion leaders. And the bottom line is that most patients, in fact, all patients in the adult study, certainly unlike in the pediatric study will be in the Phase 3 of Rett syndrome, i.e., they are stable and not declining. You may recollect that there is four phases to the clinical progress of patients with Rett. The first is where they get the diagnosis. The Phase 2 is when there is a rapid decline in functionality. Phase 3 is when they are in a stable phase by a state with a very complex level of functioning. And then there can be a phase for years, sometimes decades, and then they end up into a deterioration phase. To all patients who have struggled in the Phase 3, i.e., they are stable. So, what we are looking for clinically is any kind of deterioration, okay, because there is such a poor state, they have been stable for a while. If there is any deterioration seen in terms of Rett syndrome type behaviors or other neurological features, it’s likely to be due to over-expression than a progression of Rett syndrome. Now, will we miss a definite, no, we wouldn’t, because we can’t bite to the brain tissue, of course, in the clinical trial in patients. But the way we are observing specifically MECP2 over especially toxicity is by looking for a change in the mental status and the change of neurological status, and your behavioral status, and central nervous system, peripheral nervous system, deterioration after dosing with a gene therapy, because that’s unlikely be due to progression of Rett is likely to be due to over a special toxicity of MECP2. Having several of that, we anticipate that’s highly unlikely given NHP tox data and our rat tox data where we gave very high doses of the drug fourfold of the present clinical dose, and so no toxicity even at that high level.

Thank you. Ladies and gentlemen, we have come to the end of our time allowed for questions. I will turn the floor back to Mr. Session for any final comments.

Thank you. This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.