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The odds of a major advance in the fight against HIV/AIDS have improved with the recent announcement by Sangamo Biosciences (SGMO) that its gene therapy treatment has achieved a "functional cure" for some HIV patients in its Phase 1 clinical trials.

Tim Brown, the famous "Berlin patient" and first person cured of HIV, appeared at the HIV Cure Forum in Palm Springs and West Hollywood, Calif., on Nov. 13 and 14. Brown's visit and Sangamo's clinical trial results draw attention to an unlikely corner of human gene therapy: beneficial mutations. In Sangamo's case, its scientists generate mutations in the CCR5 gene in human CD4 T cells that conferred resistance to HIV-1, the most common strain of the virus. Brown was cured when he received donated CD4 T cells with a naturally occurring CCR5 mutation.

The Richmond, Calif.-based Sangamo has touted results at the one-year clinical trial endpoint: in five of nine subjects, CD4 T cell counts persisted a year after infusion at greater than 500 cells/mm3, the accepted threshold for initiation of HAART therapy.

"The initial results in a few patients look good and compelling," said Liana Moussatos, an analyst with Wedbush Securities. "I'd like to see the same things in Phase 2 trials with more patients. Also, I'm interested in maintenance after treatment with modified CD4 cells: how durable are those cells over time?" (The number of genetically modified CD4 T cells slowly declines over time.)

Sangamo's hoped-for "functional cure" for HIV is currently in two Phase 2 studies designed to maximize the engraftment of CCR5-disrupted T-cells. The two studies, which will focus on reduction or elimination of detectable virus in treated patients, are expected to have preliminary data in the first half of 2013 and final data later that year.

HAART therapy

Currently, the most effective HIV treatment, developed two decades ago, is a cocktail of drugs. Highly active anti-retroviral therapy (HAART) is so effective that it usually suppresses the virus to undetectable levels. However, HAART therapy doesn't prevent the virus from persisting indefinitely in patients' resting CD4 T cells, and reappearing when patients discontinue therapy.

Experts agree that switching the therapeutic focus from the virus to human genes, particularly the CCR5 gene, is the most promising prospect for a cure.

Engineering genetic cures

A once- or twice-a-year genetic-modification treatment like the one Sangamo is developing could make concerns over the durability of modified CD4 T cells irrelevant. It might be more acceptable to patients than drug therapy, which can cost up to $40,000 per year and cause toxic side effects.

At the heart of Sangamo's clinical trial is a class of enzymes called zinc finger nucleases (ZFNs). As their name implies, ZFNs contain zinc ions and protein "fingers," each of which binds to a specific nucleotide triplet. Four such fingers in one molecule bind to a specific 12-nucleotide sequence. An enzyme nuclease motif cleaves DNA at the targeted binding site.

Sangamo's gene-modifications are so precise and nontoxic that the company and researchers worldwide are working not only to optimize ZFN therapies for HIV, but also for hemophilia, Huntington's disease and hemoglobinopathies such as sickle cell anemia and beta-thalassemia. Edward Lanphier, president and CEO of Sangamo, said on Nov. 13 that he would provide details on the "timelines, development steps and next critical development points" on Dec. 6, 2012.

Sangamo scientists, working with colleagues in Italy, demonstrated in preclinical studies published in 2012 in Nature Medicine that ZFNs can be used to create safer and more potent cancer immunotherapies.

In 2012, Sangamo signed a collaborative agreement involving its zinc finger DNA-binding protein (ZFP) gene regulation technology to Shire AG (SHPG), under which Shire will develop and commercialize products to treat or diagnose hemophilia. The two companies also are developing a ZFP therapeutic for Huntington's disease, a now-incurable inherited neurodegenerative disease, and Shire also is able, under the agreement, to develop treatments for two additional gene targets. Sangamo is responsible for all research activities through the submission of an Investigative New Drug Application (IND) or European Clinical Trial Application (CTA) for seven DNA targets and Shire will pay Sangamo $8.5 million per target at completion of each IND.

Sangamo received a $13 million up-front payment from Shire, and Sangamo is eligible to receive up to $213.5 million for each of seven DNA sequences targeted; Sangamo also is eligible to receive a tiered double-digit percentage of net sales of commercialized products. No timetable has been set for the collaboration with Shire.

Sangamo will update analysts about its 2013 clinical plans on Dec. 6, 2012. In the meantime, income from collaborative agreements rose from $6.1 million in fiscal 2011 to an estimated $15 million in fiscal 2012, with total operating expenses falling from $46 million to $44.5 million over the same time period. The company's net loss will fall from $35.7 million in fiscal 2011 to an estimated $25.3 million in fiscal 2012.

Huntington's disease

Most Huntington's disease patients inherit one normal and one defective or mutant copy of the huntingtin (HTT) gene, which is enough to cause the disease. In October 2012, Sangamo announced that its ZFP therapeutic selectively repressed the expression of the mutant disease-causing form of HTT while leaving expression levels of the normal gene unchanged in cells derived from Huntington's disease patients. "We are working with Shire to accelerate the development of our Huntington's disease ZFP therapeutics," said Philip Gregory, D. Phil., Sangamo's vice president of research and chief scientific officer, in a news release.

Elusive viral target

HIV-1HIV-1, the most common strain of the virus, enters human T cells by binding simultaneously to two cell-surface receptors made by the CD4 and CCR5 genes. (Other HIV strains bind to the CD4 CXCR4 receptors.) Approaches that have blocked viral binding have cured other viral diseases, but not HIV.

Vaccines targeting the HIV-1 envelope gp120 glycoprotein, the viral coat protein that binds to human T cells, have been ineffective because the viral gp120 is chameleon like: vaccines against one version of gp120 usually don't work against others. In addition, anti-viral drugs intended to block gp120 binding to T cells lose their potency for similar reasons.

First cure for HIV

The first HIV cure was partly an act of desperation, but it opened the door to the genetic-mutation approach to thwart the disease.

Brown, suffering from cancer and dangerously low CD4 T cell counts in 2007, was given a bone marrow transplant from a donor who was homozygous for a mutant form of the CCR5 gene. The transplant helped cure the cancer and made Brown completely resistant to HIV-1. Brown's health improved dramatically; he discontinued anti-viral drug therapy and the virus has not reappeared in his blood.

Bone marrow transplants from unrelated donors like Brown's are impractical and can cause life-threatening complications such as graft-versus-host disease. Sangamo's gentler approach involves withdrawing about one billion CD4 T cells from each patient, and using ZFNs to mutate one or both of the copies of the CCR5 gene in each cell. One of the two CCR5 genes is mutated in 30-40 percent of the cells; both CCR5 genes are mutated in 5-10 percent of the cells. After the ZFN treatment, the cells are expanded to about 10 billion and they returned to the patient, after which the treated cells are believed to continue expanding in number.

Off-target questions

Most zinc-finger nucleases (ZFNs) are designed with four fingers to target 12-nucleotide sequences. ZFNs can be used in pairs, with each one binding to opposite strands of DNA, for a 24-nucleotide target, with a 15-nucleotide

When ZFNs get inside a cell, they can cause off-target gene cleavages, which could be toxic. To diminish off-target effects, the specificity of ZFNs has been greatly improved in Sangamo's SB-728-T therapy:

· Most are designed with four fingers to target 12-nucleotide sequences.

· ZFNs can be designed as pairs, with each four-finger domain binding to opposite strands of DNA, for a 24-nucleotide target, with a 15-nucleotide "spacer" between them.

· The FokI nuclease has been optimized to eliminate off-target effects: only when two FokI domains are brought together at the spacer region does the nuclease enzyme become activated and make a double-stranded DNA break.

The DNA break made by the FokI dimer automatically recruits the cell's error-prone repair mechanism -- non-homologous end-joining. In this process, one nucleotide is often incorrectly added or deleted, causing a shift in the CCR5 gene's "reading frame" that is so catastrophic that the gene is "knocked out." The treated, HIV-resistant cells are re-infused back into each patient, and researchers hope that cell division will yield more HIV-resistant CD4 T cells.

Zinc-finger competitor

ZFNs have a competitor in the form of transcription activator-like endonucleases (TALENs). Discovered in 2007 by plant-pathogen researchers, TALENs are virulence factors made by Xanthomonas, a genus of proteobacteria that causes leaf spots, streaks and other plant injuries. The pathogen's TALENs bind to the host plant's gene-promoter sequences to up- or down-regulate genes in ways that allow the pathogen to flourish.

Adam Bogdanove, a discoverer of TALENs while at Iowa State University and now a professor of plant pathology and plant-microbe biology at Cornell University. Photo: Iowa State University

"It's amazing that this underfunded area of plant physiology has created this promising technology that could be used to treat and potentially cure human diseases," said Adam Bogdanove, a discoverer of TALENs while at Iowa State University and now a professor of plant pathology and plant-microbe biology at Cornell University.

Bogdanove and colleagues at the University of Minnesota licensed their discoveries to Cellectis, a French company, in January 2012. Other TALENs intellectual property (IP) generated by plant biologists from Martin Luther University in Halle, Germany, is now owned by the Two Blades Foundation, based in Evanston, Ill. Two Blades has sold an exclusive license to Carlsbad, Calif.-based Life Technologies (LIFE). Both Cellectis and Life Technologies are aggressively marketing custom, gene-specific TALENs to researchers worldwide.

Sangamo has guarded the intellectual property related to virtually all the major ZFN discoveries, and has licensed the technology to St. Louis, Mo.-based Sigma-Aldrich (SIAL), which develops and markets tailor-made ZFN kits to researchers.

In 2011, Sigma was selling its ZFN kits for as high as $35,000 each to biotech companies and $25,000 each to academic institutions. However, those prices have plummeted to as low as $3,999 per kit due to competition from TALEN kits selling for $5,000 each.

Switching to TALENs

TALENs and ZFNs can be designed to use the same FokI endonuclease, but TALENs use simpler rules for sequence-specific DNA recognition, requiring less optimization than ZFNs.

Dana Carroll, a biochemistry professor at the University of Utah. Photo: University of Utah

"Lots of people are switching from zinc fingers over to the TALENs," Dana Carroll, a biochemistry professor at the University of Utah and an expert on both TALENs and ZFNs, said in a telephone interview. "I think things are moving very rapidly toward TALENs instead of ZFNs, and Sangamo is moving that way, too."

TALENs have had a major disadvantage: their size - they are much larger than ZFNs and therefore more difficult to deliver into a target cell.

The industry leader in ZFNs, Sangamo has also embraced TALENs. Sangamo researchers have published a recent study documenting that reducing the size of TALENs produced the desired gene disruptions at higher frequencies. The 2011 paper in Nature Biotechnology by researchers at Sangamo and Université de Nantes in France reported that truncated TALENs can be created to knock out genes with high selectivity in the rat, an important model for many human diseases.

Sangamo also has licensed ZFN technology to Dow AgroSciences (DOW) for the development of genetically improved maize, canola and other crops. (Dow pays Sangamo 25 percent of all ZFN-related sublicensing revenue it receives.) Rather than add bacterial or other foreign genes to a crop genome, ZFNs allow Dow researchers to modify a plant's existing genome, a feature that could prompt fewer objections from consumer activists and watchdog groups that are opposed to all genetically modified crops.

Since both ZFNs and TALENs use the same FokI endonuclease, the issue of off-target mutagenic effects is a fear in both cases. The technology is maturing quickly, and Sangamo has resolved the off-target issue.

"Sangamo is not trying to take shortcuts: it is doing things that nobody else can do," Moussatos said.

For example, Sangamo researchers, collaborating with scientists at MIT and the Whitehead Institute for Biomedical Research, both in Cambridge, Mass., described in a 2011 paper in Nature Biotechnology how the researchers combined two TALENs that each recognized specific 17-nucleotide sequences. The two TALENS both carry FokI domains that make double-stranded breaks in human embryonic stem cells and induced pluripotent stem cells.

The researchers assessed the frequency with which one TALEN pair makes a specific double-stranded break at five locations. The research team focused on 20 non-target nucleotide sequences that are most similar to the five intended targets.

Five targeted gene modifications in two genes were made at high rates: 67-100 percent; 2-24 percent; 50 percent; 1-13 percent; and 19-23 percent. (The rates were similar to those obtained with ZFNs.) Of the 20 most likely off-target hits, 18 had no off-target disruptions, one site was disrupted at a 169-fold lower rate than the intended target, and another off-target site was disrupted at a 1,140-fold lower rate than the intended target.

While the off-target effects were very low, specific gene-zapping TALENs can now be optimized even more to virtually eliminate off-target effects. The Nature Biotechnology paper demonstrated an approach necessary to validate the extremely high degree of specificity needed to modify genes in stem cells -- the ultimate prize for Sangamo and its partners.

Sangamo scientists and its collaborators have published a variety of papers regarding TALENs and applied for patents. However, no patents for ZFNs or TALENs have been issued by the U.S. Patent and Trademark Office. When patents are issued, there will be clarity around IP ownership.

Sangamo clinical trial groups

Investors like the company's operational frugality, but they're most interested in the company's clinical trial results.

Some patients selected for Sangamo's Phase 1 dose-escalation trial who were already doing well on HAART therapy stopped taking the therapy for up to 12 weeks, beginning four to 16 weeks after SB-728-T therapy.

Another group of patients that received SB-728-T therapy was made up of people who did not benefit from HAART therapy after two or more attempts.

Yet another group of patients with no detectable HIV in their blood, but who have suboptimal CD4 T cell counts, were given SB-728-T therapy, and they also continued HAART therapy without interruption during the trial.

The rarest group of trial participants was heterozygous for a well-known deletion mutation in their CCR5 gene. The heterozygous condition gives them intermediate resistance to HIV-1. Two months after these patients received SB-728-T therapy, HAART therapy was stopped and reinstituted, if needed, in any whose CD4 cell counts dropped below 350 cells/mm3 and/or when HIV genetic material in blood samples reached a pre-determined level over a three-week period.

All of the study's participating patients are being treated at the University of Pennsylvania. The CD4 T cell levels will be determined in all trial participants for 10 years.

High CD4 T cell counts a year after infusion in five of nine subjects is heartening to Sangamo.

"We are making good progress in two Phase 2 clinical trials designed to maximize the engraftment of SB-728-T," Geoff Nichol, Sangamo's executive vice president of research and development, said in a news release.

Source: Long Opportunity Emerges As Sangamo Leverages Gene Editing To Hemophilia, Huntington's, Other Genetic Diseases

Additional disclosure: The disclosure below should be sufficient, but since I do receive compensation from some companies that I write about I assure you that I have NOT received any compensation for this story from anybody,including Sangamo.