Q3 2020 Selecta Biosciences Inc Earnings Call

Good morning, and welcome to the select up Biosciences third quarter, 2020th financial results and corporate update conference call. At this time, all participants are and listen only mode. This call is being webcast live on the investors and media selection.

Select his website at www dot select a bio dot com and it is being recorded for opening remarks, I would like to.

Jews, Brad Doms, Chief Financial Officer of selector. Please go ahead.

Thank you and good morning, welcome to our third quarter, 20th 20th financial results in corporate update conference call.

The press release reporting our financial results is available the investors immediate section of our website www dot selective bio dot com and our quarterly report on form 10-Q for the quarter ended September 30th 2020 will be filed later on today with the S. E C J.

Joining me today are Carsten ruin, our president and C E O and Doctor Peter Traver, our <unk>, our Chief Medical Officer.

Take you shouldn't let all our chief scientific officer, it will be available for the Q&A portion of the call.

During today's call will be making certain forward looking statements, including without limitation statements about the potential safety efficacy and regulatory clinical progress of our product candidates financial projections in our future expectations plans partnerships and prospects. These statements are subject to various risks, including those related to the COVID-19 opera.

Take that are described in our filings made with the S. E C, including our most recent quarterly report on form tend to what shall be filed with the C. C. Later on today.

You were cautioned not to place undue reliance on these forward looking statements, which speak only as of today November 5th 2020, and selected disclaims any obligation to update such statements, even if management's views change.

I would now like to turn the call over to Carson Broun, our president and CEO Carson.

Thank you breads. Good morning, I appreciate you joining us today.

This past quarter has been a busy and productive one for a team is just continue to progress okay. Good programs leveraging arrange a platform.

<unk> help line data from the non Registrational face to compare trial S. C O 212, which demonstrated potential of being tour when combined with a highly even adjourn again.

In this case to get the case is.

In September we commenced the base three days off program in partnership is Sylvia and expect to have chopped my data from the Tuesday, three studies in the second half of 2022.

We look forward to continuing to advance or gene therapy program and medic Maloney S. A D mail or M. M. A with asthma are you.

Having received their be dragged disease designation from the F D a y.

Finally, we're excited to come in or Iga, Naprapathy program and anticipated idea submission put his program in 2021, having recently announced an option and likely agreement with Eigen Biosciences cause you select the access to and I J protease.

Importantly, this program will build on S. C O 212th in combining you need me to adjourn again with <unk>.

At least September we released and review at the top and data from the face to non vegetation compare trial compare the efficacy of one smoked infusions S. C O 212th what combination of select us in tour immune children's platform and a therapeutic your case enzyme big after case to bite between seasons up with all the case.

Currently approved your case in the U S for the treatment of chronic refractory couch.

2021.

We recently announced that the FDA granted rare pediatric disease designation to M&A, one warm formally SPL three or to put a treatment of isolated M&A due to methodological chase gene mutations.

This highlights the significant unmet medical need that select the hand as bio are seeking to address with M&A. One on one but is rare metabolic disorder, and we look forward to advancing this program in the hopes of helping young patients affected by M&A and the families.

We in EPS by who believe that this product candidate is differentiated and that it could allow for retreatment when combined with him tour.

As you likely saw last week bare announced that they will be acquiring asked by or to broaden the innovation base in cell and gene therapy.

As a result asked by will operate as a wholly owned subsidiary of there we.

We do not believe this will affect our current partnership with our style and our Kroger and M&A is expected to progress as planned as well as the license agreement with asked bio in Pompe disease. We're looking forward to working with the teams at asked bio and fair.

You may know that prior to my joining select during 2018 has spent nearly 10 years at they're in various roles. Most recently as president of payer pharma in the Americas and expect to have a strong working relationship going forward.

We continue to push our proprietary gene therapy program in Otcs efficiency forward and we'll provide updates on this program at a later date.

To wrap up on gene therapy, Sarepta continues to do conduct Prudential, we're looking at the combination of into or in certain near must have this orders, including duchenne muscular dystrophy and limb girdle must've dystrophies.

If sarepta exercised its option to enter in a commercial license agreements, we will be eligible for significantly economics, including additional development regulatory and commercial milestone payments as well as tiered royalties on net product sales.

Moving onto in the property during the quarter, we entered into a research license and option agreement with IAG and bio sciences, which provide selector with the option to an exclusive license for the rights to develop and commercialize the entire platform in combination with again immunoglobulin April.

Yes for the treatment of page eight net property.

The barrier of proteins from realization is to material origin of the protease, which makes it immunogenic.

As demonstrated with sales of 12 inventories shown the ability to mitigate the formation of ended drug antibodies to immunogenic enzymes, and we intend to leverage our learnings from the sale to 12 program as we advance this product candidate forwards, we intend to submit its R&D by the end of 2021.

I will now turn the call over to Peter Traber for a more detailed update on select us pipeline Peter.

Thanks, Carsten and good morning, everyone.

As Carsten mentioned, we had an exciting quarter with several updates to the pipeline let.

Let me start with SPL to 12, and I'll focus on the phase three pivotal program.

As cars to mention we commenced the dissolved program with Sobi in September.

The clinical program consists of two double blind placebo controlled trials with CL to 12 in which FCL to 12 will be evaluated at two doses of inventory.

<unk> 0.1 milligrams per kilogram and 0.15 milligrams per kilogram.

And one dose of the gag or kids.

0.2 milligrams per kilogram in both studies.

Each trial will aim to enroll 105 patients with 35 at each dose level and 35 on placebo.

In dissolve one in which the first patient was dosed in September safety and efficacy will be evaluated at six months.

And we'll have a six month extension.

Dissolved two we'll assess safety and efficacy at only the six month time point with no extension.

We expect to dose the first patient in dissolved two later this quarter.

The primary endpoint in both studies in serum uric acid levels at six months.

Well validated measure of disease severity and chronic refractory gout.

Based on learnings from the compare study, we intend to enroll a higher proportion of patients with visible tofive.

Our gene therapy programs continue to advance we expect to file the idmc for mm a one to one in the first quarter of 2021 and commence the phase one clinical trial for this product candidate in the first half of 2021.

We expect to report preliminary data on the first patient cohort by the end of 2021.

For this preliminary data, we will be looking at biomarkers of disease, and the formation of neutralizing antibodies to the AB capsid.

It can result in the development of Fiveg trop two feet one of the most common causes of kidney disease.

Hypertension, proteinuria and decrease estimated GF bar at the time of diagnosis are associated with poor prognosis.

Okay unmet medical knee.

We are currently working on I N D, enabling activities for this program and will share specific guidance on timings later.

No I would turn the call over to Brad to run through this quarter's financial results bread.

Thank you Peter.

We're very well capitalized having ended the quarter with $147.6 million in cash cash equivalents unrestricted cash.

We believe our liquidity physician will enable us to fund our operating expenses and capital expenditures into the first quarter of 2023, and this guidance excludes any impact of incoming milestone payments, which can further extend our runway.

I'll discuss a few highlights on our financial results, which we issued in detail. This morning in the press release <unk>.

Revenue recognized for the third quarter, 2020th was four $6 million. During the three months ended September 30th 2020, we recognize 4.3 million under the Soviet license, resulting from the shipment of clinical supply and the reimbursement of costs incurred for the phase III dissolved clinical program.

And 300000 for shipments under a collaboration agreement with Sorretto.

Neck have provided by operating activities was 42.1 million for the nine months ended September 30th 2020, as compared to $38 6 million used in operations for the same period in 2019.

The increase in net cash provided by operating activities was primarily due to the collection of $99.5 million a deferred revenue a 7.4 million dollar change in accrued expenses, another liabilities offset by 10.1 million and changes in prepaid expenses deposits and other assets and accounts receivable <unk> excuse me accounts payable and it's.

Seven 6 million change in accounts receivable and compared to the prior year.

Research and development expenses for the third quarter, 2020, where $14 million, which compares with 8.1 million for the same period in 2019.

The increase in cost was primarily the result of the initiation of the phase III dissolved clinical program. These costs are subject to the cost reimbursement arrangement under the Soviet license.

The increase in expenses also the result of the completion of our face to compare trough Rusty all through 12th and for work done under the asked bio collaboration.

G and a expenses for the third quarter of 2020 or $4.4 million, which compared to 3.7 million for the same period in 2019. The increase in costs was a result of expenses incurred facilities legal and professional fees offset by decreased travel expenses.

<unk> first question comes from John Newman from Canaccord. Please go ahead.

Hi, guys. Good morning, Thanks for taking my question and congrats on all the progress.

Of course, I Wonder if you could talk to us a bit about [noise].

It's really both the M&A and the LTC gene therapy programs, and just try to help us understand sort of.

What success would look like here in these are two different indications, we know that you've shown pre clinically that.

Who would use is there anybody so but we think the first two buckets uhm, we will make a tremendous difference from a clinical perspective that as a physician you can tell patients that you know there is a chance that you actually are eligible to retreat meant.

And as I said earlier, where we can assess this fairly quickly 30 60 90 days. After you get the combination off the gene therapy within two or.

Great. Thank you if I could just ask one additional question could you talk about how this technology [noise].

Excuse me.

Could better enable dose escalation in gene therapy studies, and just what that would have been for patients uhm, whereas now there they sort of get their single dose and and that's all they are are able to to receive.

We obviously believe that the applicability is very broad actually right. It's just that we as a company are right now focused on liver.

LIBOR based diseases asked that the data we have generated there is a natural fit within tourists into accumulates in the liver and we've demonstrated that we see a first dose effect actually where we get higher, especially if the transgene. So.

So thats definitely a focus area the partnerships.

Our focus on liver diseases and neuromuscular disorders.

Which is a big unmet needs, where you get very high vector doses and you have to retreat.

But there's also other indicator or other therapeutic areas.

Outside of your muscle disorders and and.

Compare study.

Which have all been implemented in the dissolved study just to name a couple of them, we're having virtual studying.

Study initiation visits for all of the sites.

We just had a virtual investigator meeting provoke dissolved one and dissolved too, but those are kind of operational things on how we get the study up and going in a time of Covid pandemic in terms of addressing redirect patient needs, we have implemented home health care.

Visit for both you know drawing blood samples within the appropriate windows doing examinations et cetera.

Crossbows studies.

So we're we're spending the extra time effort and money.

To make sure that we can go to patience with individual home health care.

We have also.

Implemented electronics iPad.

So that each of the patients have for entering patient reported data at the appropriate time slot. So that doesn't have to be direct interaction between sites or medical personnel for the patients to comply with entering enter.

<unk> data for receiving artwork C. R O <unk>, receiving information to keep up with ensuring that patients fill those out joint diaries et cetera. So all of the things that we may have encountered issues with.

As in the compare study.

Addressed in the dissolved study.

Thank you that's very helpful.

Once again, if you have a question. Please press stars N. One our next question comes from <unk> Prasad William Plan. Please go ahead.

Thanks for taking the question was wondering a little bit if we can get a little bit more color on what's left to do for the enemy trial.

And you know what to expect as far as kind of durability or what you were expecting the durability to have data by the end of 21 I'm just trying to figure out you know the cadence of other than that no not.

Not gonna happen and whether the I N D filing is based on interrelated stuff that needs to be submitted or the gene therapy related stuff for mass fire. Thanks.

Yeah, maybe I'll I'll start garage and then have you know either Peter Okay, Uhm jumping as well. So obviously we are working on on the preclinical studies Uhm that is looking both at M Tour, but also of course, the you know the the.

The impact of into it in a specific disease model as well so that that work is S. M is ongoing and and an almost done and on track actually for an I D. Finding it early next year. So so we're very excited about that so we we feel very much on track.

To file in in Q1, and and have the first station dosed in the first half of next year, but Peter Okay. If you want to add some more color.

As we head into the end of the year, we look forward to sharing more information about the growth of the entire platform. Please stay safe and healthy. This concludes todays call. Thank you.