Q2 2020 Sangamo Therapeutics Inc Earnings Call
[music].
Ladies and gentlemen, today's conference is scheduled to begin shortly please continue to standby. Thank you for your patience.
Operator: Ladies and gentlemen, today's conference is scheduled to begin shortly. Please continue to stand by. Thank you for your patience. Ladies and gentlemen, thank you for standing by, and welcome to the Sangamo Second Quarter 2020 teleconference. At this time, all participants are in a listen-only mode.
Operator: After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker, Mr. McDavid Stilwell. Please go ahead, sir.
McDavid Stilwell: Good afternoon, and thank you for joining us today. With me on this call are several members of the Sangamo Executive Leadership Team, including Sandy Macrae, Chief Executive Officer, Sung Lee, Chief Financial Officer, Mark McClung, Chief Business Officer, Jason Fontenot, Interim Head of Research, Bettina Cockroft, Chief Medical Officer, and Melita Sun Jung, Head of Business Development. 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 column includes forward-looking statements regarding Sangamo's current expectations. These statements include, but are not limited to, statements relating to our pipeline of genomic medicine product candidates, our ability to develop, obtain regulatory approvals for, and commercialize therapies to treat certain diseases, and the timing, availability, and cost of such therapies.
[music].
Ladies and gentlemen, thank you for standing by and welcome to the Sangamo second quarter 2020 teleconference. At this time all participants are in listen only mode. After the speaker presentation, there will be a question and answer session.
Ask a question during the session you want me to press Star one on your telephone please be advised that today's conference is being recorded.
If you require any further assistance. Please press star zero I would not only to hand the conference over to your Speaker Mr. Mcdavid Stilwell. Please go ahead Sir.
Good afternoon, and thank you for joining us today.
With me this afternoon on this call or several members of the Sangamo executive leadership team, including Sandy Mcrae, Chief Executive Officer sung Lee Chief Financial Officer, Mark Mccollum, Chief Business Officer, Jason, but no interim head of research Bettina Cockrell Chief Medical Officer.
McDavid Stilwell: Plans and timelines for Sangamo and our collaborators to conduct clinical trials and share clinical data and the potential for data to demonstrate clinical benefit to patients, the potential to use certain technologies to develop our therapies, our collaboration strategy, and the potential to earn fees, milestone payments, and royalties from our collaboration. Plans and timelines for building and opening manufacturing facilities. The effects of the evolving COVID-19 pandemic.
And the leader Sunjata had a business development.
Well I feel more corporate presentation can be found at our website Sangamo dot com under the investors and media section in the events and presentations page.
This call includes forward looking statements regarding thank you most current expectation.
These statements include but are not limited to statements relating to our pipeline of genomic medicine product candidates.
Our ability to develop obtain regulatory approval for and commercialize therapies to treat certain diseases, and the timing availability and cost of such therapy.
Clinton timeline for Sangamo, and our collaborators to conduct clinical trials and share clinical data and the potential for data to demonstrate clinical benefit to patients.
The potential use certain technology to develop our therapy, our collaboration strategy and the potential to earn fees milestone payments and loyalty from our collaboration.
Plans and timelines for building and opening manufacturing facilities.
McDavid Stilwell: The anticipated benefits of our organizational changes. Our expectations regarding our financial performance and resources. And other statements that are not historical facts.
The effects of the evolving cobot 19 pandemic.
Anticipated benefits of our organizational changes.
Our expectations regarding our financial performance in resources.
And other statements that are not historical facts.
McDavid Stilwell: Actual results may differ substantially from what we discussed today. In addition, these statements are not guarantees of future performance and are subject to certain risks and uncertainties that are discussed in documents that we file with the Securities and Exchange Commission, specifically in our quarterly report on Form 10-Q for the quarter ended June 30, 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 under applicable law. On this call, we discuss a non-GAAP financial measure. We believe this measure is helpful in understanding our past financial performance and our potential future results. However, this is not meant to be considered in isolation or as a substitute for the comparable gap measure.
Actual results may differ substantially from what we discussed today.
In addition, these statements are not guarantees of future performance and are subject to certain risks and uncertainties that are discussed in documents, we file with the Securities Exchange Commission specifically in our quarterly report on form 10-Q for the quarter ended June Thirtyth 2020.
The forward looking statements stated today are made as of this state and we undertake no duty to update such information, except as required under applicable Oh.
On this call we discuss a non-GAAP financial measure. We believe this measure is helpful and understanding our past financial performance and or a true our potential future results.
This is not meant to be considered in isolation or as a substitute for the comparable GAAP measure.
Alexander D. Macrae: The comparable GAP measure and reconciliations of GAP to the non-GAP measure discussed in this column are included in today's press release, which is available on our website. And now, I'd like to turn over the call to Sandy. Thank you, MacDavid, and good afternoon to everyone on the call. Last week, Sangamo and Novartis announced a global collaboration to develop gene regulation therapies for three undisclosed neurodevelopmental targets, including genes linked to certain forms of autism spectrum disorder and intellectual disability. We believe that this seventh collaboration with yet another accomplished biopharmaceutical partner further validates the confidence our industry has in Sangamo's ThinkFinger protein platform and illustrates the value and potential of genomic medicine in neuroscience. We are thrilled to be collaborating with Novartis, who bring exceptional expertise to your development and are committed to pioneering the next wave of innovative treatments. The collaboration will leverage our proprietary zinc finger protein transcription factors, or ZFP-TFs, in an effort to regulate or activate the expression of genes that are inadequately expressed in individuals with certain types of neurodevelopmental disorders.
Comparable GAAP measure and reconciliations of GAAP to non-GAAP measure discussed on this call are included in today's press release, which is available on our website.
And now I'd like the turnover there call the sandy.
Thank you Mick David.
Good afternoon, everyone on the coal.
Last week, Sangamo and departures and then so global collaboration to develop gene regulation therapies for city undisclosed you need to go meant to targets, including genes linked to certain forms of up to some spectrum disorder ended to let you disability.
We believe this sentence collaboration with yet another accomplish bio pharmaceutical partner, but they're probably needs to complement our industry hasn't sangha boosting think approaching platform.
And in the streets about potential of Gino mentioned in your sites.
We're through to be caught reaching with departures. He brings exceptional expertise in your development and is committed to pioneering the next week of individuals treatments.
The collaboration will leverage our proprietary seed finger pucci transcription factors or see if P.T. EPS in an effort to regulate right to beat the expression of genes <unk> inadequately expressed an individual certain types of your developmental disorders.
Under the collaboration agreement signed with expects to receive an upfront 75 million dollar license fee payment Amir in up to 720 million builders in other development regulatory and commercial milestone payments comprised of up to $420 million into development mode.
Alexander D. Macrae: Under the Collaboration Agreement, Sangamo expects to receive an up-front $75 million license fee payment and may earn up to $720 million in other development, regulatory, and commercial milestone payments, comprised of up to $420 million in development milestones and up to $300 million in commercial milestones. Sangamo is also eligible to earn tiered, high single-digit to sub-teen double-digit royalties on potential net commercial sales of products arising from the collaboration. At Sangamo, we are prioritizing our opportunities and optimizing our resources in order to thoughtfully build our pipeline of medicines leveraging our zinc finger protein technology, which we believe we can engineer to address virtually any genomic target. By partnering with collaborators such as Novartis, who have therapeutic area expertise in clinical trial and commercial infrastructure to support the development of treatments for biologically complex diseases, we believe we can maximize the value of our technology and get our medicines to patients as quickly as possible.
Ones and up to 300 million and commercial milestones.
Second was also eligible to earn tiered holiday single digit so teen double digit going to potential Nick commercial sales of products arising from the collaboration.
That said, we're prioritizing or opportunities and optimizing our resources in order to thought we'd build or pipeline medicines leaf routing or zinc finger protein technology, which we believe we can engineer to address virtually any genomic target.
By partnering with clumpy to such as nut Butters therapeutic Erie expertise in clinical trials in commercial infrastructure to support to dawn of treatments for biologically complex diseases. We believe we can maximize the value for technology and get our medicines to patients as quickly as possible.
Alexander D. Macrae: Partnerships have enabled us to build a pipeline in therapeutic areas from neurology to oncology that are significantly strengthened by the expertise and infrastructure of our collaborators. The Novartis collaboration marks our fourth partnership in the CNS area alone, building upon our expansive collaboration with Biogen announced earlier this year and our ongoing partnerships with Pfizer and Takeda in neurodegenerative diseases. These collaborations demonstrate the versatility of our Zincfinger platform to address many CNS diseases.
Partnerships have enabled us to build a pipeline in therapeutic areas from urology tone colucci, they're significantly strengthened by the expertise and infrastructure for collaborators.
In the boxes cooperation marks or sports partnership in the CNS, Syria aluminum building upon our expansive collaboration with Biogen and then Saturday of this year I.
I never ongoing partnerships with Pfizer and Takeda and your degenerative diseases.
These collaborations demonstrate the versatility repurchasing finger platform to address many CNS diseases. The promise that you know what mentioned in your signings under ability to continue to important dues as there's too many more CNS targets or technology could address.
Alexander D. Macrae: The promise of genomic medicine in neuroscience and our ability to continue to do important deals as there are still many more CNS targets that our technology could address. Including the Navarchis collaboration, these CNS partnerships have already generated $450 million in upfront cash and potentially could generate $3.24 billion in future milestone payments, in addition to future royalties and potential net commercial sales of approved products. In the last four years, partnerships have brought in nearly $780 million in cash through up-front and milestone payments and equity purchases and have been an important part of our ability to fund our proprietary pipeline. In the second quarter, Pfizer presented follow-up data from the Phase 1-2 ALTAR study evaluating duotocogene fetal parvovec, or SB525, gene therapy in haemophilia A. We are very excited about the results and look forward to Pfizer initiating the phase 3 study later this year. Bettina will provide more details about the data and program in her remarks.
Including the departures cooperation DCNS partnerships already generated $450 million, an upfront cash potentially could generate $3.24 billion in future milestone payments.
In addition to future royalties and potential net commercial sales of approved products.
In the last four years partnerships have brought to nearly $780 million in cash through upfront and milestone payments and equity purchases and it being an important part of her ability to fund our proprietary pipeline.
In the second quarter, Pfizer presented although data from the phase one two or two study.
I'll leave it to your Takatoshi fit to comfort back RSP fight to fight gene therapy in hemophilia a.
We're very excited about results and look forward to Pfizer initiating the phase three study later this year.
But she never will provide more details of the data and program in her remarks.
In response to the ongoing coop at 19 pandemic single cycle continues to prioritize employee safety and welfare our responsibility advancing the business.
Alexander D. Macrae: In response to the ongoing COVID-19 pandemic, Sangamo continues to prioritize employee safety and welfare while responsibly advancing the business. Our modified lab operations and updated safety protocols remain in place, which allow us to continue critical research and manufacturing readiness while protecting employee safety and adhering to social distancing guidelines. In fact, we continue to make excellent progress in these areas despite the challenges of COVID-19. For example, our manufacturing quality teams at our Brisbane facility demonstrated tremendous creativity and resolve in achieving an important milestone in our process of obtaining GMP certification despite COVID-19 restrictions. We completed the execution of the Environmental Monitoring Performance Qualification, or EMPQ, which validates that the clean room air and cleaning regimes and controls inside the facility are effective.
So to fight lap operations, an updated safety protocols remain in place we should allow us to continue critical research and manufacturing readiness.
Oh, protecting employee safety and adhering to social distancing guidelines.
In fact, we continue to make excellent progress in D. serious despite the challenges of Cupet 19.
For example, or manufacturing quality teams. That's her brisman facility demonstrated tremendous creativity in Brazil, and achieving important most soon in a process of the teething GMP certification. Despite kupek 19 restrictions.
We completed the execution of the environmental monitoring performance qualification or M P to which validates the clean gloomier and cleaning machines and controls inside the facility or effect.
We're continuing to come Pablo Microbiological results support her successful GMP qualification and remain on track triggered Brisman manufacturing facility operations. This year.
We continue to work diligently with their clinical trials say partners to protect the safety for patients in our trials maintained its integrity and assess the appropriateness of dosing patients.
Lastly, I'm delighted to be joined today by Jason functional or hedge cell therapy, who has assumed the role of interim head of research.
He is already contributing tremendously to cycle with his vision for cell therapy, and we're excited for the impact.
Across the entire research group, keeping us focus and research the can translate to the clinic.
And at the forefront of genomic signs.
Jason its appointment was part of an organized Nishu change, we announced or R&D team will be separated research and development functions.
A search for a hedge book to Bill is currently underway.
Alexander D. Macrae: We are continuing to compile microbiological results that will support our successful GMP qualification and remain on track to have our Brisbane manufacturing facility operational this year. We continue to work diligently with our clinical trial site partners to protect the safety of our patients in our trials, maintain data integrity, and assess the appropriateness of dosing patients. Lastly, I'm delighted to be joined today by Jason Fontenot, our Head of Cell Therapy, who has assumed the role of Interim Head of Research. He has already contributed tremendously to Sango with his vision for self-therapy, and we're excited for the impact he will have across the entire research group, keeping us focused on research that can translate to the clinic and at the forefront of genomic science. Jason's appointment was part of an organizational change we announced to our R&D team, where we separated research and development functions. A search for the head of the villain is currently underway.
This change is designed to increase the speed and efficiency if the clinical translation of her sites and allows us to industrialize think finger protein engineering, while retaining our strength in basic research and I think you capabilities in late stage clinical and product development.
Third there with regards to organizational updates this quarter, we promoted just pretty good hedge of quality to senior Vice President and Chief quality Officer.
We expect you continued to please I'm in central rule and progressing on manufacturing strategy.
With that I'll turn the call Luther Chief Medical Officer Pitino.
Good afternoon.
Sunday mentioned, we inside right now updated results from the phase one two out to study evaluating chirruped achieved positive it or a site to site gene therapy in patients with severe hemophilia a.
The data were presented by study investigating a bunch so well situation.
Twentytwenty well Oh that's.
The results demonstrated at all size patients who received three a team that could you know it around those [laughter] sustain a activity level with the me in 64.2 cents, but pretty much any yesterday.
Some basic level geometric mean up at least nine puts infuse.
No patients.
Eating event or class eight fusion.
[laughter] eight activity level, let's say measurement 61 will be.
Extend to follow ups for the longest treated patients in Oh.
You're up to pitching.
With that was generally well tolerated by the pace.
The data so previous findings from this study.
I didn't notice that they are encouraged by the potential of truck.
But to demonstrate long term stability and important element to patients living with severe hemophilia a.
Bettina M. Cockroft: This change is designed to increase the speed and efficiency of the clinical translation of our science and allows us to industrialize zinc finger protein engineering while retaining our strength in basic research and adding new capabilities in late stage clinical and product development. Furthermore, with regard to organizational updates, this quarter we promoted Jaspreet Gill, Head of Quality, to Senior Vice President and Chief Quality Officer. We expect she'll continue to play an essential role in progressing our manufacturing strategy. With that, I will turn the call over to our Chief Medical Officer, Bettina. Good afternoon. As Sandy mentioned, we in Pfizer announced updated results from the Phase 1-2 ALTA study evaluating gyropticogene-fetal-parvovet, or SB525, gene therapy in patients with severe haemophilia A. The data were presented by a study investigator at the Virtual World Federation of Haemophilia 2020 World Congress. The results demonstrated that all five patients who received the 3E13 vector genomes per kilogram dose exhibited sustained factor VIII activity levels, with a median of 64.2% by a chromogenic assay based on patient-level geometric means after week 9 post-infusion. No patients experienced bleeding events or required Factor VIII infusion.
Hi, so in some good luck tend to prevent the follow up data from the Alpha study when all five patients in the three team did you know a kit if I'm dose cohorts happy follow tricky one year.
Let's say three lead and study is currently ongoing inside has announced that it sounds to dose patients in the pivotal phase three trial later this year.
Moving onto our wholly owned gene therapy at 80, 920 in Fabry disease, which we are evaluating it lets say swung to star study.
As we detail previously timing of dosing is patient has been impacted by the code 19 pandemic.
Team continues to look so principal investigators on this study and we have successfully screen doesn't roll several patients the eager to receive yes, tonight's like infusion.
It's opportunity.
We're working closely with investigators on the clinical trial sites to make the top and as soon as it it seems space as appropriate.
Over the second quarter, we have continued to receive additional approvals for the phase one two that's up.
He evaluating effect of human car T. Reg cells therapy tier 200, A.H. delay to mismatched kidney transplantation.
In addition at the end of July we received a recommendation from the European Medicines agency electrification of the top 30 minutes milk product ATM, Pete CTX 200.
The ATM pizza allocation will allow us to puts you T X 200 development in a delineated regulatory framework.
Scientific and regulatory guidance.
I will now turn the call over to some for an overview of the financial results Uh Huh.
Thank you, but Tina and good afternoon, everyone. We're pleased to share our financial results for the second quarter 2020.
We reported a net lots of $35.9 million were 26 cents per share compared to a net loss of $30.3 million were 26 cents per share for the same period and 29 team.
Total revenues were $21.6 million compared to $17.5 million for the same period and 29 team.
Turning to expenses.
Non-GAAP operating expenses, which excludes stock based compensation expense were $52.7 million compared to $46.2 million for the same period and 29 team.
Bettina M. Cockroft: The factor VIII activity levels reflect measurements up to 61 weeks, the extent of follow-ups of the longest treated patient in the cohort. Uroctococcine Fetal Parvovec was generally well tolerated by the patient. The data affirm previous findings from this study. Pfizer noted that they are encouraged by the potential of Xeroxicogenes vitilparvavec to demonstrate long-term durability, an important element for patients living with severe hemophilia A. Pfizer and Sangamo plan to present further follow-up data from the ALPHA study when all five patients in the 3E13 vector genomes per kilogram dose cohort have been followed for at least one The Phase 3 lead-in study is currently ongoing, and Pfizer has announced that it plans to dose patients in the pivotal Phase 3 trial later this year.
The increase in operating expenses reflects our head count growth and facilities expansion to support the advancement of our therapeutic pipeline and manufacturing capability.
These increases were partially offset by a decrease in clinical and manufacturing supply expense it.
Moving to the balance sheet, we ended the quarter with $665 million and cash cash equivalents and marketable security.
This balance reflects that $350 million received from our partner Biogen.
We anticipate receiving an additional 75 million dollar upfront license fee of the third quarter from our new partner Novartis.
Our balance sheet remains strong and we believe we have the ability to reach several important R&D milestones, including the first potential B O <unk> filing for hemophilia a.
Turning to 2020 full year guidance.
We are revising our non-GAAP operating expense guidance from an estimated range of $245 million to $260 million to an estimated range of 210 to two and $225 million.
That's reduction.
It's primarily being driven by the effects of evolving cobot 19 pandemic.
It's anticipated impact on our clinical program timeline.
I will now I'll turn it back to Sandy for closing remarks.
Thank you Sir.
I'm pleased with the progress you've been making it sank and will this quarter keeping a researching manufacturing activities on track in spite of the challenges presented by group at 19.
Bettina M. Cockroft: Moving on to our whole gene therapy ST920 in Fabry disease, which we are evaluating in the Phase 1-2 STAR study. As we detailed previously, timing of dosing of patients has been impacted by the COVID-19 pandemic. Our team continues to work closely with principal investigators on this study, and we have successfully screened and enrolled several patients who are eager to receive the ST920 infusion at the earliest opportunity. We're working closely with the investigators and the clinical trial sites to make this happen as soon as it is deemed safe and appropriate. Over the second quarter, we continued to receive additional approvals for the Phase I-II Steadfast clinical study evaluating our first-in-human CAR Treg cell therapy TX200 in HLA-A2 mismatched kidney transplantation. In addition, at the end of July, we received a recommendation from the European Medicines Agency on the classification of TX200 as an Advanced Therapy Medicinal Product, ATMP. The ATMP classification will allow us to pursue TX200 development in a delineated regulatory framework with precise scientific and regulatory guidance.
We've been working with Pfizer to present exciting updated results from or hemophilia APRU from and partnering with Novartis yet another top pharmaceutical company, who were compelled by are highly differentiated zinc finger protein genomic medicine platform.
These accomplishments so to send them on a strong position to deliver important near seven milestones such as the dosing of the first patient and Pfizer's be stream affiliate trial this year.
Our third ruling inducing with puppy disease gene therapy study and getting over 80 be manufacturing facility in or Brisman headquarters operational by the end of this year.
I'd like to close by thanking the many team members a sizable who contributed to the initiation of the collaboration with nut Butters, particularly our newer scientists and business development teams their passion and their dedication brings tremendous value to sustainable.
We along with our partners or the boxes are excited to begin working on pioneering treatments. We hope will change the likes of patients by moving beyond the symptom focus treatment so to do and toward therapies that can potentially owed to the natural history of these lifelong challenging you developmental disorders.
Operator.
Please open the line for questions.
Thank you.
The asked the question at this time, you'll need to press Star then one on your telephone to withdraw your question. Please press the pound key.
Our first question comes on the line Oh, My recall with Jefferies. Your line is now open.
Overall off congrats on all of artist. Thanks for taking my question. First question is just or was it more viable scale equally evo validate your technology and dog. What are you guys are done and then there a space just wondering if you can talk more about add capacity for additional.
Sung Lee: I will now turn the call over to Sam for an overview of the financial results. Thank you, Bettina, and good afternoon, everyone. We're pleased to share our financial results for the second quarter of 2020. We reported a net loss of $35.9 million, or $0.26 per share, compared to a net loss of $30.3 million, or $0.26 per share, for the same period in 2019. Total revenues were $21.6 million, compared to $17.5 million for the same period in 2019. Now, turning to expenses. Non-GAAP operating expenses, which exclude stock-based compensation expense, were $52.7 million compared to $46.2 million for the same period in 2019.
Deals like this and if there's any other perspective, you can provide and to begin with somebody.
Similarly thinking thank you for your question a we're delighted with the Novartis do they truly are experts in your development I Wonder if mark Who's our chief business Officer crude.
Suppose hope you are answer question about I, we think about future too well.
Thanks, Andy Yeah, So I.
I think it's safe to say that these deals have been very important in terms that.
Expanding our pipeline.
Of activity to support the partnership.
In areas that we wouldn't otherwise.
The entering into so we look at that is really an expansion of R&D portfolio.
ER and putting that in the competent and Oh folks that are I'm familiar with the disease areas and have this skill sets and capability.
Towards successfully.
Finally, we have our own target.
It will continue to prosecute and take boarded bankable wholly own but in the case that.
Other companies want to access our technology was the more happy too.
On the converts.
And Melissa could you maybe comment on how would the deal came upon.
Sung Lee: The increase in operating expenses reflects our headcount growth and facility expansion to support the advancement of our therapeutic pipeline and manufacturing capabilities. These increases were partially offset by a decrease in clinical and manufacturing supply expenses. Moving to the balance sheet, we ended the quarter with $665 million in cash, cash equivalents, and marketable securities. This balance reflects the $350 million received from our partner, Biojet. We anticipate receiving an additional $75 million upfront license fee in the third quarter from our new partner, Novartis. Our balance sheet remains strong, and we believe we have the ability to reach several important R&D milestones, including the first potential BLA filing for hemophilia A. Turning to 2020 full-year guidance, we are revising our non-GAAP operating expense guidance from an estimated range of $245 to $260 million to an estimated range of $210 to $225 million.
Through the bunching process.
Yeah, absolutely Fannie Novartis will push that's within an interest in adjusting or a developmental upregulation targets I think in oneq level and they recognize that at our platform has the power to adjust the challenging targets and conversation today from that part that point on.
To evolve into the collaboration Louisiana.
In summary, we are excited because these are new targets for us. So it isn't that we've given a week something from or pipeline. It's that weve added to these three targets are things that we have no considered prosecuting we're delighted to build to help in the boxes and we're really pleased to put them in the hands.
All.
A company that is passionate but this area I can get to two patients as quickly as possible.
Okay, great. Thank you for the all perspective and <unk>.
Thank you. Our next question comes on the line of Nicole coming out with two other securities. Your line is now open.
Good afternoon, everyone and thanks for taking my question.
Congrats again on the in Nevada migration, Oh little bit more on.
You can give more color on but.
Bernard.
Target.
Can you talk more about.
Well, then but haven't watch and then more decided.
That's all.
So I I want to make sure I understood. Your question, you're you're asking is supposed to we select targets.
Oh and more about the yeah well.
Alexander D. Macrae: This reduction is primarily being driven by the effects of the evolving COVID-19 pandemic and its anticipated impact on our clinical program timeline. I will now turn it back to Sandy for closing remarks. Thank you, John. I'm pleased with the progress we've been making at Sangamo this quarter, keeping our research and manufacturing activities on track, in spite of the challenges presented by COVID-19. We've been working with Pfizer to present exciting, updated results from our Haemophilia A program and partnering with Novartis, yet another top pharmaceutical company, who were compelled by our highly differentiated zinc finger protein genomic medicine plan. These accomplishments have put Sangamo in a strong position to deliver on important near-stern milestones, such as dosing the first patient in Pfizer's Phase 3 Haemophili I'd like to close by thanking the many team members at Sangamo who contributed to the initiation of the collaboration with Navarra, particularly our neuroscientists and business development team. Their passion and their dedication bring tremendous value to Sangamo.
Okay for you know these Uh huh.
Yes.
Good day for that.
And how did they come about.
How did they.
So I understand your question. So these are things that the boxes are passionate about the there are many targets within the CMS I think were to hundreds of genes certainly in some way to.
Important medical disorders.
Single is an expert in all the thesis we have things that we're interested in we did the by each into earlier this year based around mainly around newer generation run time, <unk> and some new clean for Alzheimer's and Parkinson's respectively.
And then those conversations we run a process.
<unk> was part of it for a short time and but it was clear that they were more interested with your development.
And had some plus sneaking ideas about how do they could use our technology to address those conditions and it was it was really pleasing to being too it would cheating and his team at network and to take these forward.
There are many targets in the brain and is other people come to us and ask for on income per targets. We will look to see whether we think we can do it and also whether we believe the beacon prosecute them well.
Great. Thanks, so much.
Thank you. Our next question comes on the line of Jim Birchenough with Wells Fargo. Your line is now open.
Yeah, Hi, guys. Congrats on all the progress during the quarter and that the artist collaboration a couple of questions. I guess, just first on the manufacturing facility you're building out in Brisbane.
Having fully operational by year end, we've seen a fair amount of large pharma interest in gene therapy manufacturing at scale and other grammar acquisition by Thermo Fisher, how would you position your manufacturing capabilities relative to other leaders in the space.
Thanks, Jim Thanks for the question. So it's just something you can you want to speak to.
Sure steady so Jim.
Basically I would describe this manufacturing strategy is twofold. So as you know over the last past fear and even this year, we have made significant investments in our future manufacturing capability.
Operator: We, along with our partners at Abarthus, are excited to begin working on pioneering treatments we hope will change the lives of patients by moving beyond the symptom-focused treatments of today and towards therapies that can potentially alter the natural history of these lifelong, challenging neurodevelopmental disorders. Operator. Please open the line for questions. Thank you. To ask a question at this time, you will need to press star then 1 on your telephone.
And by the end of this year.
We do expect to have a vector manufacturing up and running.
Hearing our brisbin facility and then beyond that you're going into next year, we do expect so cell therapy manufacturing.
Both in brisbin and in our French facility in Melbourne.
Got it and maybe just a follow up on the Novartis and biofuel.
Collaborations obviously you know.
With that earlier point on the validation that's created around zinc finger.
Operator: To withdraw your question, please press the pound key. Our first question comes from the line of Maurice Raycroft with Jeffreys. Your line is now open. Hi everyone. Congratulations on all the progress and thanks for taking my questions. The first question is just on the recent Novartis deal. Definitely validates your technology and what you guys have done in the neuro space. Just wondering if you could talk more about capacity for additional deals like this and if there's any other perspective that you can provide on the deal with Novartis. So Maury, thank you for your question.
So teams and the team regulation, what are you doing internally to leverage those those capabilities and when might we get some visibility on internal programs and the CNS space.
So that's a great question, Jason as our leading a research organization to want to talk about.
What we're doing for CNS research.
Sure sure. Thanks, Andy.
Well I mean, we've got a variety of targets that.
We are looking for our internal program, but I think we'll probably.
As those.
As we advance or are there.
But.
I think sandy pointed out.
Great thing about platform.
But we have a technology applied to essentially.
In the gene.
So.
Working on the things that we feel we're best positioned to move forward ourselves.
Alexander D. Macrae: We are delighted with the Novartis deal. They truly are experts in your development. I wonder if Mark, who's our Chief Business Officer, could help you answer the question about how we think about future deals. Mark? Thanks, Andy.
And where we're partnering the ER.
The targets that we feel like you know we have the opportunity.
Partners.
In a better way.
And Jim.
One of the the view benefits of these partnerships is a low supposed to do.
Good pools scientists and some newer scientists to put together the the things that the partners about score and almost as a byproduct took about we development expertise and CNS diseases and and delivery to the brain.
Mark McClung: Yeah, so I think it's safe to say that these deals have been very important in terms of expanding our pipeline and activities to support these partnerships in areas that we wouldn't otherwise. We look at that as really an expansion of our R&D portfolio and putting that in the competent hands of folks that are familiar with the disease areas and have the skill sets and capabilities to take those forward successfully. Clearly, we have our own targets that we'll continue to prosecute and take forward as Sangamo whole we own. But in the case that other companies want to access our technology, we'll be more than happy to engage with them in those kinds of conversations. And Melita, could you maybe comment on how the deal came about after the badging process? Yeah, absolutely, Sandy.
And so it gives us.
An internal platform to build on the woo hopefully result in some targets are sizable wouldn't and delivered.
And maybe just quickly one follow up you know you can have a partnership with undisclosed targets without us trying to figure out what they are so is there anything you can say about the targets for autism spectrum disorder, whether they're novel targets known and if there's any degree of validation. If we were to sort of look in the literature.
I think the best thing, we can see has their own disclosed.
The the autism spectrum so.
When Novartis approaches I think we'll win on a very steep learning curve for autism.
And well.
Combs strikes me is the there are within the spectrum. There are a few targets are closely linked central mclee to subsets of autism no isn't bite by any means the who will be autism spectrum disorder, but I think the belief.
For the boxes on the same could move endorse is if they can shoot benefit in a subgroup. It may be possible to test the smithson's in the larger spectrum or less linked to specific genes.
Melita Sun Jung: So Novartis approached us with an interest in addressing neurodevelopmental upregulation targets at the genomic level, and they recognized that our platform has the power to address these challenging targets, and the conversation progressed from that part, that point on to evolve into the collaboration we recently had. And, Maury, we're excited because these are new targets for us. So it isn't that we've given away something from our pipeline; it's that we've added to it. These three targets are things that we had not considered prosecuting.
But we have gone and let our friends, we have to lever friends at Novartis and talk about this.
Great well, thanks for taking the questions guys.
Thanks, Jim.
Thank you.
Question comes on the line of Gena Wang with Barclays. Your line is now open.
Hi, This is David dye allergy and I think it for taking my question and the congrats on the progress I have two questions first went off fabry disease.
So you have come into that more than two patients have enrolled in June on his comment on how many more have been road and what are some the gating factors before they can be dosed.
Is that those are the two questions to its fabry patients and then the gating factors I think not.
As most appropriate from Bettina, our chief Medical Officer Patina.
Ive to say so in fact, we we've made leasing progress in successfully involving several subjects I don't think will be disclosing the exact number yeah, but suffice it to say that now it's just a matter of scheduling infusions of pizza hut subject. So in terms of gating went just looking at a safe.
Alexander D. Macrae: We're delighted to be able to help Novartis, and we're really pleased to put them in the hands of a company that is passionate about this area and will get them to patients as quickly as possible. Great, great. Thank you for that perspective, and I'll hop back in.
Okay opportunity to initiate a treatment in the context of a pandemic and we are working very closely with the trial site, who are also very eager to me it's.
Operator: Thank you. Our next question comes from the line of Nicole Germino with Chua Securities. Your line is now open. Good afternoon, everyone.
That's very helpful. Actually I had another question had to this those actual one question. So second question is on.
<unk> 18 therapy, so what we expect an update of for the gene therapy. Later this year and then we're going forward. How are you and your partner Pfizer plan to provide an update you know with investors.
Operator: And thanks for taking my question. And congrats again on the Novartis collaboration. Just a little bit more on, if you could give us a little bit more on the color of the Sangamo approach for neurodevelopmental targets. Can you talk to us more about, more specifically around autism, the target selection, and more of the strategies for identifying these targets? And I guess, So I want to make sure I understood your question. You're asking us about how we select targets. Oh, um, more about the approach Novartis is taking with these neurodevelopmental targets. Did they present you with this target? And how did they come about with this target? How did they die?
David This seems like one for you.
Sure. So are we in Pfizer said that the next update will come after all the subjects in the 313 dose cohort have passed through a year or follow up.
So.
That that.
As much as we've said about the timing of there okay.
No matter, how thinking I.
Thank you. Our next question will come from the line of Evan Wang with Guggenheim Securities. Your line is now open.
Hi, Thanks for taking the question I've two questions.
Can you describe the applicability of the GM regulation platform outside of neuro and is thinking about pursuing opportunities there.
And your second question.
The second question is affected by with the balance sheet from the two recent deals is saying about considering any kind of strategic decisions around pipeline or tech platform I have to kind of enhancer accelerate and what they're saying it might be as the best way to do so.
So I'm going to give the first one to Jason and then Mark can you take the second one.
So Jason the use of transcription factors will be limited to the brain.
Absolutely not we are.
Alexander D. Macrae: So I understand your question. So these are things that Novartis is passionate about. Then, there are many targets within the CNS. I've been quoted, hundreds of genes are linked in some way to Important Medical Disorders. Sango is not an expert in all of these.
You know the exciting thing about our I think finger platform is that.
We can use the target nucleases.
Oppressors activators and in all of those cases.
There is utility and different tissues.
And opportunities both for in vivo.
Use as well as ex vivo.
Cell therapy platform.
And we are exploring all of those options.
[music].
Alexander D. Macrae: We have things that we're interested in. We did the Biogen deal earlier this year based mainly on neurodegeneration, around tau and synuclein for Alzheimer's and Parkinson's, respectively. And in those conversations, we ran a process. Novartis was part of it for a short time, but it was clear that they were more interested in newer developments and had some fascinating ideas about how they could use our technology to address those conditions. And it was really pleasing to be able to work with Jay and his team at NIPR and to take these forward. There are many targets in the brain, and if other people come to us and ask for unencumbered targets, we'll look to see whether we think we can do it, and also whether we believe that they can prosecute them well.
And Jason Yes, Jason could Jason can you teased can you t. so the difference between.
Conscription factor and the nucleus, which is more analogous to other other people's descriptions of editing.
Yes, so you know when when when people use the term editing I think it's often used in the context.
Nucleases.
Okay, that's the big finger Nucleases and then of course.
Our competitors with CRISPR Casnine programs.
And in those context, we are introducing breaks into the DNA and sometimes that's necessary an important.
But in other situation.
Being able to do something without causing a double stranded breaking the DNA becomes very important.
Offers a lot of advantages and that's a that's a particularly.
Interesting and powerful part of our platform with our transcriptional activators transcriptional oppressors and it's something that we're looking to deployed both in a in our cell therapy program as well.
Melita Sun Jung: Great, thanks so much. Thank you. Our next question comes from the line of Jim Bertinoff with Wells Fargo. Your line is now open.
Vivo program.
Another tissues.
And Mark can you talk about how does this fits into our.
Portfolio management.
We have no doubt that my line to set up and then it.
Operator: Hi guys, congratulations on all the progress during the quarter and the VARDIS collaboration. A couple of questions, I guess just first on the manufacturing facility you're building out in Brisbane, you know, having it fully operational by year-end. We've seen a fair amount of large pharma interest in gene therapy manufacturing at scale, you know, the Brammer acquisition by Thermo Fisher. How would you position your manufacturing capabilities relative to other leaders in the space?
We can you.
Okay. Good yeah. So so obviously as we take a look at our technology in particular, the car T regs and some of the work that we're doing to enhance delivery to the brain and and other target tissues. We'll continue to take a look outside where we can partner appropriately gain.
Access the things that will complement and improve our ability to deliver important transformative medicine.
I mean are clear objective is is continue to expand our cell therapy on capability, including advancing wholly owned assets in that state and in addition to the optimizing our you, though and as you go in and then here.
Sung Lee: Thanks, Jim. Thanks for the question. Sung, is this something you want to speak to me about? Sure, Sandy.
Thank you.
I hope that answers your questions.
Yes. Thank you.
Thank you.
Thank you.
Sung Lee: So, Jim, basically, I would describe this manufacturing strategy as twofold. So, as you know, over the past year and even this year, we have made significant investments in our future manufacturing capability. And by the end of this year, we do expect to have vector manufacturing up and running here in our Brisbane facility.
As a reminder to ask the question you only need to press Star then one on your telephone.
Our next question comes from the line.
I want to below with Cowen Your line is now open.
Hi, guys. Thanks for taking the question I guess, if we think about the Novartis steel in the Biogen deals here among diagram what.
Either diseases or target.
Are both outside so deal and that might be indication. Thank you guys are interested in going after sandy I think you alluded to some thing you guys had in mind can you can you talk further about what you guys might want to take forward and yeah.
So I'm I'm going to process on Timna, we tend to know me because I believe to did most deals and and did a fantastic I mean very few people to nearly half a billion worth of deals and of course superior.
Sung Lee: And then beyond this year, going into next year, we do expect cell therapy manufacturing both in Brisbane and in our French facility in Valbonne. Got it, and maybe just to follow up on the Novartis and Biogen collaborations, obviously, you know, with the earlier point on the validation that's created around your zinc finger proteins and gene regulation, you know, what are you doing internally to leverage those capabilities, and when might we get some visibility on internal programs in the CNS space? So that's a great question.
We we didnt expertise Bali BOLI being in the CNS and being with partners are experts in it but really to can you help us think about how did the targets were chosen.
Well the lease for sanction.
Sure happy to city, the it's important to keep in mind that all of the deal exclusivity and the global right very specific to the identified targets and I don't recall the by the collaboration will provide for the 12 neurological target and the Novartis collaboration is exclusive to you know regulation. So this is our thinking there.
13 transcription factor platform that if it was just talking about what the in specifically to upregulate expression of genes in threed their developmental target and the collaboration will also leverage our proprietary due to regulation technology and similarly to the by the collaboration.
Jason D. Fontenot: Jason, as the leader of our research organization, do you want to talk about what we're doing for CNS research? Sure, sure. Thanks, Andy.
Jason D. Fontenot: Well, I mean, we've got a variety of targets that we are looking for people who are willing to take the next step in their lives for our internal programs, and I think we'll probably close those as we advance them. You know, as Sandy has pointed out, thank you, working on the things that we feel we're best positioned to move forward ourselves, targets that we feel like, you know, we have the opportunity to get to the clinic with. And, Jim, one of the real benefits of these partnerships is that it allows us to build a group of scientists and some neuroscientists to put together the things that the partners have asked for, and almost as a byproduct of that, we develop expertise in CNS diseases and in delivery to the brain, an internal platform to build on that will hopefully result in some targets that are Sangamo owned and delivered.
No bad assets, our proprietary Easter delivery as Mark and Jason, but one thing that's an area of continued investment in interest.
So you can see because the craft these deals on it at target that target I target basis. It leaves really a whole unencumbered universe of additional targets that we can then.
Or partner with others.
Yeah, and wondering area Yeah go ahead.
An example of that we spoke about to around do you do in December of last year was prime disease. For example, where we showed evidence that we can turn done probably on.
Expression within the CNS, which has both hereditary form an acquired animal zoonotic phone I guess is but that is just an exemplary of span many targets that we would consider.
And noted that we have an active good effectively churning CNS machine.
Gives us an opportunity such good into other areas.
Got it and a follow up question on Fabry I'm should we be thinking about dosing like youre like your other studies low mid high doses heated treatment of the mission.
Jason D. Fontenot: And maybe just quickly, one follow-up question, you know, you can't have a partnership with undisclosed targets without us trying to figure out what they are. So is there anything you can say about the targets for autism spectrum disorder, whether they're novel targets, known, and if there's any degree of validation, if we were to sort of look in the literature? I think the best thing we can see is that they're undisclosed. The Autism Spectre is so...
Yes.
[noise] Bettina.
Yes, yes in fact, what we have said.
Is that we are going to happen low and medium and high those and that's exactly as you described it.
Gating, but safety review.
As we move from one cohort to the next.
The agency, whose name is regaining competence in HIV treatment, but it's still a know who are you, saying and this is all new do.
The second or third second time, we've done a gene therapy trial and therefore, it's appropriate in the we are prudent and start with a little those.
<unk> through those doses and we're not going to talk about the results until we do still keep cohorts.
Alexander D. Macrae: When Novartis approached us, I think we all went on a very steep learning curve for autism. And what strikes me is that within that spectrum, there are a few targets that are closely linked syndromically to subsets of autism. Now, it isn't by any means the whole of the autism spectrum disorder, but I think the belief at Novartis and that Sangamo endorse is that if they can show benefit in a subgroup, it may be possible to test these medicines in the larger spectrum that are less linked to specific genes.
Because we feel that that will give them much more meaning to me. So the will be much more informative.
Got it any any additional color on what the chances are quite.
David.
We havent disclosed beyond the low medium and high.
Got it okay. Thanks for getting questions.
Thank you very much.
Thank you. This concludes today's question and answer session I would now like to turn the call back to Fannie Mcrae for closing remarks.
So as you can see is it's another exciting quarter for sizable were delighted for your support and I just want to wish you in your families to stay safe and well and we look forward to talking to you again soon.
Alexander D. Macrae: But we have got to let our friends, we have to let our friends at the Bartas talk about this. Great. Well, thanks for taking the questions, guys. Thanks, Jim.
Ladies and gentlemen. This concludes today's conference call. Thank you for your participation you may now that's kinda.
Operator: Thank you. Our next question comes from the line of Gina Wang with Barclays. Your line is now open. Thanks, this is David Dai on Vagina.
Everyone have a great day.
[music].
Operator: Thank you for taking my questions and congratulations on the progress. I have two questions. The first one is about Fabry's disease.
Bettina M. Cockroft: So you've commented that more than two patients have been enrolled in June. Can you just comment on how many more have been enrolled and what are some of the gating factors before they can be dosed? Those are the two questions.
Bettina M. Cockroft: So it's Fabry, the patients, and then the gating factors. I think that is most appropriate from Bettina, our Chief Medical Officer, Bettina. Absolutely. So, in fact, we've made recent progress in successfully enrolling several subjects. I don't think we'll be disclosing the exact number here.
Bettina M. Cockroft: But suffice it to say that now it's just a matter of scheduling the infusions of these first subjects. So in terms of gating, we're just looking at that safe and appropriate opportunity to initiate the treatment in the context of a pandemic. And we are working very closely with the trial sites, who are also very eager to make this happen. Kind of very helpful. Actually, I have another question. This was actually just one question.
[music].
McDavid Stilwell: So the second question is on hemophilic aging therapy. So will we expect an update on the gene therapy later this year? And then moving forward, how are you and your partner, Pfizer, planning to provide an update to the investors? MacDavid, this feels like one for you.
McDavid Stilwell: Sure, so we in Pfizer said that the next update will come after all the subjects in the 313 dose cohort have passed through a year of follow-up. So that's as much as we've said about the timing. Thank you, guys. Thank you. Our next question comes from the line of Evan Wang with Guggenheim Securities. Your line is now open.
Operator: Hi, thanks for taking the question. I have two questions. Can you describe the applicability of the Genome Regulation Platform outside of Nero, and is Sangamo pursuing opportunities there? And your second question? The second question is, what's the balance sheet from the two recent deals of Sangamo considering any kind of strategic decisions around pipeline or tech platform to kind of enhance or accelerate? And what does Sangamo view as the best way to do so?
Jason D. Fontenot: So I'm going to give the first one to Jason, and then Mark, can you take the second one? So Jason, the use of transcription factors will be limited to the brain. Absolutely not. We are, www.kenhub.com, Repressors. And in all of those cases.
Jason D. Fontenot: There is utility, and an Opportunities Post, for In Vivo, as well as ex vivo in cell therapy, and we are exploring all of them. And Jason, Jason, can you tease out the difference between Transcription Factor and the Nucleus, which is more analogous to other people's descriptions of editing Yeah, so, you know, when people use the term editing, I think it's often used in the context of, in our case, the big finger nucleases and then, of course, our competitors and the CRISPR-Cas9 program. And in those contexts, we are introducing a break. Sometimes that's necessary and important.
Jason D. Fontenot: But in other situations... being able to do something without causing a double-stranded break, very important, offers a lot of advance. That's that's a particularly interesting and powerful part of our platform, with our transcriptional activators and our transcriptional repressor, something that we're looking to deploy in our self-therapy program. And Mark, can you talk about how this fits into our Portfolio Management?
Mark McClung: Can you hear me okay? I think my line just cut out for a minute. We can hear you.
Mark McClung: Okay, good. Yeah, so, as we take a look at our technology, in particular, the CAR Tregs, and some of the work that we're doing to enhance delivery to the brain and other target tissues, we'll continue to look outside where we can partner appropriately to gain access to things that will complement and improve our ability to deliver important transformative medicine. I mean, our clear objective is to continue to expand our cell therapy capabilities, including advancing fully-owned assets in that space and, in addition, really optimizing our in vivo and ex-vivo genome engineering. I hope that answers your question. Thank you. As a reminder, to ask a question, you will need to press star then 1 on your telephone. Our next question comes from the line of Ratu Burrell with Cowan. Your line is now open.
Operator: Hey guys, thanks for taking the question. Um, I guess if we think about the Novartis deal and the Biogen deal as sort of a Venn diagram, what diseases or targets are both outside both deals. And that might be indications that you guys are interested in going after.
Alexander D. Macrae: Sandy, I think you alluded to something you guys had in mind. Can you talk further about what you guys might want to take forward? And, you know, So I'm I'm going to pass this on to Malita in a moment because Malita did both deals and did a fantastic job. I mean, very few people do nearly half a billion worth of deals in the course of a year, but um, we gain expertise by being in the CNS and being with partners that are experts in it, but Mal Sure. I'm happy to hear that, Sandy. So it's important to keep in mind that all of the DEAL exclusivities and the global rights are very specific to the identified targets. As you'll recall, the Biogen collaboration has the rights to 12 neurological targets, and the Novartis collaboration is exclusive to genome regulation. So this is our zinc finger protein transcription factor platform that Jason was just talking about, with the aim specifically to up-regulate the expression of key genes in three neurodevelopmental targets.
[music].
Melita Sun Jung: The collaboration will also leverage our proprietary genome regulation technology, similarly to the Biogen collaboration. And they'll also have access to our proprietary AAVs for delivery, as Mark and Jason both mentioned; that's an area of continued investment and interest for us. So, as you can see, because we craft these deals on a target-by-target basis, it leaves a whole unencumbered universe of additional targets that we can then pursue on our own or partner with others. Yeah, and this is just one example.
Alexander D. Macrae: And other areas. Yeah. An example that we spoke about at our R&D day in December of last year was prion disease, for example, where we showed evidence that we can turn down prion expression within the CNS, which has both a hereditary form and an acquired animal zoonotic form. I guess it is, but that is just an exemplar of many targets that we would consider.
Alexander D. Macrae: And now that we have an active, an actively churning CNS machine, it gives us an opportunity to go into other areas. Got it. And a follow-up question on Fabry: should we be thinking about dosing, like your other studies, low, mid, high doses with some gated treatment of the patients that you've enrolled? Bettina.
Bettina M. Cockroft: Yes, yes. In fact, what we have said is that we are going to have a low, a medium, and a high dose. And that's exactly as you described it with gating, with safety review, as we move from one cohort to the next. The agency is gaining confidence in AAV treatment, but it's still a novel, a new thing, and this is only the... This is the second time we've done a gene therapy trial, and therefore, it's appropriate that we are prudent and start with a low dose and move through those doses. And we are not going to talk about the results until we've dosed all three cohorts, because we feel that that will give a much more meaningful result that will be much more informative. Got it. Any additional color on what the doses are at this point? David, We haven't yet disclosed anything beyond the low, medium, and high.
[music].
Bettina M. Cockroft: Got it. OK. Thanks, Virginia.
Operator: Thank you very much. Thank you. This concludes today's question and answer session. I would now like to turn the call back to Sandy Macrae for closing remarks. As you can see, it's another exciting quarter for Sangamo.
Alexander D. Macrae: We're delighted for your support, and I just want to wish you and your families a safe and well day. Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone have a great day.
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