REGENXBIO Inc. (NASDAQ:RGNX) Q1 2024 Earnings Call Transcript May 8, 2024
REGENXBIO Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Good day and thank you for standing by. Welcome to REGENXBIO’s First Quarter 2024 Earnings Conference 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. I would now like to hand the conference over to your speaker today Patrick Christmas, Chief Legal Officer. Please go ahead.
Patrick Christmas: 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, 2024. The press release is 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, 2023, and comparable risk factors sections 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 08, 2024 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 like to now turn the call over to Ken Mills, CEO of REGENXBIO. Ken?
Ken Mills: Thank you, Patrick, good afternoon everyone. Thanks for joining us. I’m pleased to begin today’s call with a recap of the recent business highlights as well as an update on our corporate goals. Today, Curran Simpson, our Chief Operating Officer, will be speaking for Steve Pakola, Chief Medical Officer, who’s unable to join us today. Curran will provide an update on our clinical programs. Then Vit Vasista, our Chief Financial Officer, will provide an overview of the financial results for the quarter ended March 31, 2024. At the end of the call, we’ll open up the line for questions. We have what I think are some exciting updates today and so I want to get right into these topics. We started off the year making significant progress across our pipeline as we advance each of our programs toward pivotal stage clinical trials and commercialization.
In 2024, we’ve put a focus on large commercial opportunities where our product candidates are differentiated, can be expedited, and support meaningful value generation soon and for the long-term. Our priority programs, our RGX-202 for the treatment of Duchenne, ABBV-RGX-314, or 314, for the treatment of wet AMD and diabetic retinopathy, or DR, being developed in collaboration with AbbVie, and RGX-121 for the treatment of MPS II, or Hunter syndrome. All of our programs remain on track to meet our goals for this year. Program milestones over the past couple of months further demonstrate how our new plan is supporting the acceleration of the development of our gene therapies and the expansion of value for shareholders. Today, we’re especially pleased to share new positive data and important updates about acceleration in our programs for Duchenne and DR using in-office delivery.
We are providing some new updated guidance on near-term milestones for these programs. So let me explain. We’re thrilled to see RGX-202 is demonstrating strong microdystrophin expression across a wide range of patients, including in older boys like those ages eight to under twelve, and importantly, we are seeing positive safety signals. No SAEs have been reported in patients who’ve received RGX-202, which is highly notable differentiator in Duchenne gene therapy trials. Today, we announced that we have selected our pivotal dose. Also, we have already begun a new expansion phase of our clinical development with the pivotal dose. This includes the enrollment of third and fourth boys already. Expansion using the pivotal dose will continue into the third quarter and can enroll up to a total of seven boys in the ages ranging from four to under twelve.
By early Q3, we expect to hold an end of Phase 2 meeting with the FDA, which will support a final pivotal design and pivotal trial initiation is anticipated in late Q3 to early Q4 of this year. RGX-202 is a differentiated product candidate in the landscape for Duchenne, representing the closest thing to natural healthy dystrophin and we believe has the potential to make a meaningful difference for a broad range of patients. Given these unique characteristics of RGX-202, a significant ongoing unmet need in the Duchenne community, in conversations with the FDA we’re confident in our plans to file a BLA using the accelerated approval pathway. Separately, we believe there’s a multibillion dollar potential opportunity for ABBV-RGX-314 as a single injection treatment to become a first-in-class gene therapy for wet AMD, and the standard of care to treat and prevent progression for diabetic retinopathy.
Enrollment remains on track for our subretinal delivery program for wet AMD, currently in pivotal trials. And today we announced that based on positive interim results to date from the Phase 2 ALTITUDE trial in DR, the design and evaluation of two pivotal trials is ongoing, which would be the first pivotal trials for our in-office suprachoroidal delivery. These positive results and activities are in support of a planned discussion with the FDA at an end of Phase 2 meeting anticipated in Q1 2025 that can enable the rapid acceleration toward pivotal development. We would expect to initiate the first two pivotal trials for suprachoroidal delivery of diabetic retinopathy in the first half of 2025. As a one-time treatment, we believe that 314 is well positioned to become the standard of care to treat and prevent progression of diabetic retinopathy, which is expected to impact over 20 million people globally in the next five years.
Overall, we’re thrilled about the current status and the way that 2024 can achieve meaningful value generation based on what we’ve seen in these first few months. With that, I’m going to turn the call over to Chief Operating Officer, Curran Simpson, who take us through a bit more of a detailed update on the Duchenne data and our plans for accelerating the pivotal trial initiation for Duchenne in the second half of this year and diabetic retinopathy in the first half of next year. Curran?
Curran Simpson: Thank you, Ken. I’ll start with RGX-202, a potential one-time gene therapy for the treatment of Duchenne. RGX-202 represents an alternative for boys, who may not be eligible for other AAV mediated microdystrophin therapies due to age or presence of preexisting neutralizing antibodies. Today we reported that new microdystrophin expression from the second patient, aged 8.1 years, who received RDX-202 at dose level 2, was measured at 20.9% compared to control at three months. A reduction in baseline in serum creatinine kinase, CK levels of approximately 90% was observed at ten weeks. We’re excited about this data and the robust response seen in this trial, particularly in dose level 2 and in older boys. As we shared previously, we used two methods of measuring microdystrophin protein, western blot the Jess and LC-MS.
Notably in this case, the microdystrophin measured using LC-MS for this patient was approximately 44% higher than the western blot result. Today’s data adds to the totality of evidence demonstrating that all patients, who completed three month trial assessments, indicate consistent, encouraging increases in expression of RGX-202 microdystrophin and the reduction from baseline in serum CK levels, supporting early evidence of clinical benefit. In addition, early evidence of strength and motor function improvement were observed via trial clinic assessments and home videos shared with trial investigators by caregivers. As of May 3, 2024, RGX-202 continues to be well tolerated in all treated patients with no serious adverse events. Given the robust data and positive safety signals, we plan to move forward with dose level 2, 2e14 per kilogram as our pivotal trial dose.
We have initiated an accelerated dose level 2 expansion cohort and have already dosed two patients. We expect to treat up to a total of seven patients at the pivotal dose. Looking ahead, we remain on track to share strength and functional data for both dose levels and initiate dosing in the pivotal trial in late Q3 to early Q4 this year. Moving to 314, which is being developed in collaboration with AbbVie to try treat wet AMD and diabetic retinopathy via subretinal and suprachoroidal routes of administration. We are evaluating 314 for the treatment of wet AMD via subretinal delivery in two ongoing pivotal trials, ATMOSPHERE and ASCENT, in the U.S., Europe and Japan. We anticipate global regulatory submissions in the first half of 2026. We are also evaluating 314 in the Phase 2 ALTITUDE trial, which is the dose escalation study of 314 using suprachoroidal delivery.
We’re very excited about the opportunity in DR given the size of market, which exceeds that of wet AMD. One year data from dose levels 1 and 2 showed 314 to be well tolerated with patients demonstrating clinically meaningful improvements in disease severity with reductions in vision threatening events. Based on these and other positive interim results from ALTITUDE, today we are pleased to share more details about our path to pivotal stage in DR. We are evaluating the design for two pivotal trials in support of an end to Phase 2 meeting with the FDA anticipated in the first quarter of 2025. We expect to start the first pivotal trial in DR in the first half of 2025. We’ve aligned with our partner AbbVie on this timing and believe there may be opportunities to further accelerate.
To conclude, we continue to make significant progress with data updates and trial progression across all programs in our pipeline. Lastly, I’d like to thank the patients, families, clinicians and patient advocacy representatives who have been involved and supported all of these trials. And with that, I turn the call over to Vit to review our financial guidance. Vit?
Vit Vasista: Thank you, Curran. REGENXBIO ended the quarter on March 31, 2024 with cash, cash equivalents and marketable securities totaling $381 million, compared to $314 million as of December 31, 2023. The increase was primarily attributable to the $131 million in net proceeds received from an upsized public offering of common stock and pre-funded warrants completed in March 2024, partially offset by cash used to fund operating activities in the first quarter of 2024. R&D expenses were $55 million for the first quarter of 2024, compared to $59 million for the first quarter of 2023. The decrease was primarily attributable to reduced manufacturing and clinical supply costs for our lead product candidates and personal related costs as a result of reduced headcount.
It was partially offset by an increase in clinical trial expenses across our lead product candidates. We expect a balance in cash, cash equivalents and marketable securities of $381 million as of March 31, 2024 to fund our operations into 2026. 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, including a potential milestone payment of $200 million receivable upon achieving the dosing of the first patient in the pivotal trial for suprachoroidal delivery for treatment of DR. Additionally, this cash runway guidance excludes any potential monetization of a priority review voucher that may be received for RGX-121.
With that, I will turn the call back to Ken Mosabi [ph] to provide final thoughts.
Ken Mills: Thanks Vit. So to wrap things up, so far in 2024, our plans are on track and intended to generate significant value for shareholders as we’re ensuring that resources are allocated to the most valuable assets and to accelerate the development of those assets. As outlined here today and supported by the press release announcements, we’re motivated by expanding that value by addressing important unmet need in patients and focusing on large commercial opportunities where we think our product candidates are differentiated and have a clear regulatory pathway forward. The recent efficacy and safety data has allowed us to determine the planned pivotal dose for RGX-202 which is enabling us to further accelerate this program.
So far, this drug candidate is exceeding our expectations in the clinic. We’ve already begun a clinical trial expansion phase to add voice onto our pivotal dose, a step that we believe will contribute meaningfully to our accelerated approval plans. Duchenne is a market where there is large unmet need for new therapies and that is capable of supporting multiple gene therapies. And we believe RGX-202 has unique differentiating features that support its potential to be a best-in-class product. Regardless of today’s landscape of Duchenne treatments, communication from the FDA continues to support the need for alternative gene therapies for rare diseases, including Duchenne. Backed by strong data, we’re acting with urgency and in concert with the FDA, taking steps to initiate the pivotal trial for RGX-202 as soon as possible this year, and focused on serving needs in a broad range of voice.
We are also continuing to grow value with our eye care partnership with AbbVie. It’s using our one time treatments that provide sustaining vision health long term and overcome the clinical challenges of managing retinal diseases. The updates today highlight key alignment on important partnership goals in 2024 that are directed at completing trial designs and plans for initiating first pivotal trials for RGX-314 using in-office suprachoroidal delivery in diabetic retinopathy and completing enrollment of our pivotal trials for RGX-314 using subretinal delivery to support filing of global regulatory submissions. And as Curran mentioned, we believe there are opportunities to further accelerate these programs. RGX-121 is meaningfully changing course of disease in boys with MPS II by restoring a missing gene, and we’re on track to file our first BLA as a company in 2024 using the accelerated approval pathway for RGX-121.
Our pivotal trial achieved its primary endpoint of reduction of natural substrate in the CSF. Patients treated with RGX-121 have showed continued improvement in neurodevelopmental skill acquisition up to four years and have discontinued intravenous enzyme replacement therapy. Our pivotal trial was designed to enroll boys under the age of five. A strong proportion of those enrolled in our program are below the age of two. And these are key features that are important in assessing neuronopathic Hunter syndrome. We’re locking our clinical trial databases and our team is busy collecting final pivotal trial data and completing steps for the entire BLA filing process. By the end of 2024, our pipeline should be filled with programs that are initiating pivotal stage, fully enrolled at pivotal stage or under a filed BLA.
And as Vit mentioned in the fourth quarter, we announced a successful public offering. This raise strengthens our balance sheet, it extends our operating runway into 2026 to support the acceleration of our candidates through multiple value generating milestones today, but it’s worth noting and restating that achievement of certain of these milestones would also trigger hundreds of millions of dollars of additional funds. As a result of these recent updates and the upcoming milestones announced today, we believe REGENXBIO is well positioned for success. Thanks everyone for your time today. That finishes our discussion part of the call, and now we’re going to move over to Q&A.
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