Sarepta Therapeutics Inc. (NASDAQ:SRPT)
2013 UBS Global Healthcare Conference Call
May 21, 2013 8:30 AM ET
Chris Garabedian – President and CEO
Thanks for coming in the second of the UBS Global Healthcare Conference. I’m Matthew Harrison, one of the biotech analysts here, and pleased to have Sarepta presenting this morning. We have the CEO, Chris Garabedian presenting and happy to introduce him. Chris?
Thanks, Matt, and thanks to UBS for the invitation to present today. Yeah, I’d like to present on Sarepta therapeutics and what our Company is working on particularly in the DMD space. I’ll be making some forward-looking statements, so please refer to our SEC filings for risk factors associated with the Company.
We’re building a company that is designed for independence and success in the future. And we’re assembling a team that really understands drug development, regulatory, and manufacturing and we’re basically preparing for success particularly around our Duchenne Muscular Dystrophy program and I’ll talk more specifically about that.
So our proprietary program in the rare disease space is an area of important focus for us. Our lead program Eteplirsen which I’ll talk about today is in a long-term extension Phase IIB study. We have already shared our primary endpoint and we continue to generate follow-up data.
We have three follow-on products behind it that are in pre-clinical stage of development. We’ve identified lead sequences for those three compounds and are preparing for the pre-clinical testing to have I&Ds [ph] filed on those beginning next year.
In the infection disease area we do have several programs that have largely been funded by the Federal government or being actively funded. The two programs we have active right now are our Marburg Virus program that has initiated multiple ascending dose studies and our Influenza drug candidate that is also in a combination, single ascending and multiple ascending dose study.
But I’m largely going to talk about our Duchenne Muscular Dystrophy program. This is a devastating rare genetic disease. It’s 100% fatal. And it basically leads to loss of ambulation or wheelchair dependency in the pre-teen to early teen years. It affects 1 in 3,500 boys worldwide and there is no FDA approved treatments for the disease.
Oral corticosteroids are used as a standard of care which is basically extended survival to some degree but it really hasn’t changed the progression of the disease or the slope of the decline on some of these measures.
This disease really is a result of these patients largely boys that are unable to produce the dystrophin protein. Dystrophin is the essential protein in all of our muscles that allows the elasticity. It allows us to have basically a healthy muscle function. And without that it leads a degenerative process, inflammation that leads to fibrosis that leads to degeneration of the muscle tissue to the point where they really start to lose their ability to walk
Then they start to lose basal muscle function, their pulmonary function, cardiac function. They start to lose their upper arm mobility and typically pass away in their 20s. They can pass away earlier than their 20s with a life expectancy of around 25 years of age.
So our drug Eteplirsen it’s an antisense oligonucleotide that’s very different than other RNA approaches and that our backbone chemistry is a synthetic PMO, its phosphorodiamidate morpholino oligomer chemistry and it doesn’t adhere to the same ribose ring nucleic acid sugar structure that you typically see in the RNA space. And we believe this confer a lot of drug-like characteristics that are beneficial and it’s why we have been able to dose up to 50 migs per kig now for more than a year and a half without really any lab abnormalities or serious adverse events or clinically significant adverse events that would be dose limiting.
The mechanism of action uses Watson and Crick base pairing to basically silence or hybridize out or the reading frame a specific exon that’s causing the deletion-addition to be out of frame. So in this case we have a patient who’s the most common genotype in our study is a deletion of exon 49 and 50 in the dystrophin gene.
And so what Eteplirsen is doing is targeting a sequence in exon 51 that basically allows the translation to skip over that exon we call the bad actor that’s causing it to be out of frame. By skipping over exon 51, we created an in-frame deletion that’s akin to much milder phenotype called Becker Muscular Dystrophy.
So the idea is if we can convert a Duchenne genotype into a Becker genotype, that the phenotype characteristics of much milder disease would also be conferred.
And so we tried to understand our drugs effect on dystrophin production and clinical outcomes in this Phase IIB study. You’ll notice the first 24 weeks which was a blinded phase of the study was intended to understand the relationship of dose and duration on dystrophin production.
So we looked at the highest dose that we tested 50 migs per kig at 12 weeks so we can compare 12 weeks of treatment on dystrophin production to a previous dose escalation study we did that looked at 4.5 migs per kig up to 20 migs per kig.
But then we were hearing more from the opinion leader community in Duchenne that said, maybe you need to dose longer. And so we wanted to look at 24 weeks of treatment on dystrophin production at a lower dose, 30 migs per kig.
And essentially what we found was that duration is more important than dose in the production of dystrophin in that the 30 milligram per kilogram arm over 24 weeks showed robust consistent dystrophin production, an average of over 20% dystrophin positive fibers while the 50 mig dose, the higher dose, really showed none 0.8% dystrophin positive fibers in 12 weeks and that compared to 12 weeks to the placebo patients of 0.4% in that arm.
We designed a third biopsy which I’ll share that data in a minute and then we’ve continued to follow the patients and I’ll share some of the clinical outcomes and safety associated with the study as well.
In terms of the baseline characteristics, this was an ambulatory DMD population that was amenable to this specific exon skip 51. We enrolled patients in ages 7 to 13 was the inclusion criteria. And then we capped the health of the patients in terms of how far they can walk on a six-minute walk test. This is the standard clinical outcome measure that’s been used for approval on other neuromuscular conditions and as being used as a primary endpoint in other dystrophin producing DMD drugs in the clinic.
They were also on a stable dose of oral corticosteroids for at least 24 weeks prior to enrollment and they were not allowed to have any changes or alterations in their steroid use during the study.
You’ll see that this was, for an ambulatory population, this is relatively older age cohort. The average age was 9.3. Notably the treated arm was almost more than half a year older than the placebo arm. So again we had an older population and the treated population.
And you’ll look at six-minute walk baseline, I’ll be sharing a little bit of natural history here and predictors of response, but again below 400 meters, many believe that you should not be enrolling patients who are 350 or lower in an ambulatory study because of the risk of them losing ambulation during the course of the study.
And in fact we did have two boys who were enrolled in the 30 milligram group you can see that the averages in the 30 milligram are lower on six-minute walk and that’s largely due to these two boys who happened to be identical twins who rapidly lost ambulation after enrolling in the study. In fact they were below 250 meters at week four which is considered highly predictive of loss of ambulation.
And in fact we did see them losing ambulation and they weren’t able to complete the six-minute walk test by week 24, the first time plan which we had confirmed dystrophin in their muscles.
So I highlight that because we are reporting all of the data on an ongoing basis with the modified intent to treat analysis and you’ll see the clinical outcomes remove these two boys because they’re on invaluable on ambulatory measures.
Importantly we don’t consider them non-responders because they’re looking very stable on other measures of non-ambulation like pulmonary function, like muscle strength, upper arm test like Nine-hole Peg Test.
So there were three main things we were trying to demonstrate and improve in this study. The first was the biochemical efficacy. Was the drug doing what we reported to do which is produce dystrophin consistently at robust levels that we believe would lead to meaningful clinical benefit.
And we did that. In fact after 48 weeks of treatment, this is based on the third biopsy I described we had 47% dystrophin positive fibers on average so this is essentially half of all of the fibers counted and this was across 24 slices of muscle biopsy independently stained, reviewed on a blinded basis average and then subtract it out from any baseline noise we saw.
So this is a very conservative rigorous way of capturing dystrophin positive fibers and importantly we believe this was the best way to measure it because looking at the muscle biopsy you see how well diffused the dystrophin is, if it localized to the cell membrane, the sarcolemma, the way it should be, we wanted to understand.
You needed to have a threshold level of intensity to even read it as a positive fiber. And we wanted to see how well it can form when you look at a fiber around a cell and you’ll see some images of this how well the integrity of that dystrophin protein that’s being produced looks on the biopsy sample.
We also crossed over the placebo patients and demonstrated that even the placebo crossover group after 24 weeks of treatment showed a good outcome, an average of 38.3%. There was one patient in the 50 milligram that had higher than average than we would have expected at 24 weeks that was driving some of those scores up.
And these are individual patient scores on dystrophin production. Again, the first part of the study, we staggered the biopsy. So you see the lack of dystrophin positive fibers in this 50 mig group at 12 weeks. But then we you start to see what 24 weeks looks like and then 48 weeks on this.
And we just like to show the images from an example of each patient in the study. This is pre-treatment after 24 weeks. And you start to see further accumulation that was verified quantitatively after 48 weeks of treatment. And so we were very encouraged by how well diffused and distributed the dystrophin is and how the intensity really shows up when it does light up in a specific fiber.
And then here's the 50 milligram. You can see after 12 weeks, we really don't see much of a difference compared to an untreated or pre-treatment biopsy. And then 48 weeks, we start to see, really, the dystrophin materialized. And then this is the placebo crossover group. Again, 24 weeks of treatment.
So this is an example of a patient. This is identified as patient six where the only cell that is not patient six is 12 weeks just to show again the progression of dystrophin production with treatment with Eteplirsen that there is a delayed treatment effect that we don't see the dystrophin light up after a week or even 12 weeks of dosing that sometime between 12 weeks and 24 weeks we start to see the dystrophin materialized and we would expect that treatment benefit to be conferred sometime beyond that first 12 weeks of dosing.
And that's important when we try to interpret the clinical outcomes and look at the clinical outcomes through your appropriate lands on when the onset of the dystrophin and the drug really would take effect.
And you see, we also confirmed the dystrophin through other measures. We look at dystrophin intensity and it was correlated to dystrophin positive fibers. So were pleased to see kind of the secondary analysis of dystrophin on intensity was consistent with the dystrophin positive fibers. We also have supportive data from western blot and RTPCR to show protein production was being made in the patient.
And we also looked at the restoration of the dystroglycan complex. So producing dystrophin is important, but also making sure that it connects to the other glycoproteins that are within the cell membrane as well as that it connect to the actin filament, for example. And so we basically did an earlier study where we looked at all of the glycoproteins. You can see across the tab, alpha-dystroglycan, beta-dystroglycan. And you can see the cartoon here of where it connects at the cell membrane.
We also looked at beta-sarcoglycan, gamma-sarcoglycan, and nNos in the recent study that I've just shared with you. So we believe that this demonstrates. This is a functional dystrophin protein that's restoring the dystroglycan complex. Again, just think about the dystrophin protein, the two ends where it connects to the cell membrane and then active filament inside the cell are critical.
The rod domain, right, we know it's not as essential because in the Becker muscular dystrophy patient, many of them are missing a big loss of amino acid. But they have those two critical functional ends of the dystrophin protein. All we're doing with our technology is skipping over that mutation in the middle and reconnecting those two functional ends of the dystrophin protein of which again the patients are naturally producing.
We're not injecting a recount form of dystrophin. All we're doing is changing the genetic machinery so these patients can create the dystrophin that they would normally create if they were a Beck muscular dystrophy patient.
So I'm going to share some of our clinical trial results. This is the latest data we had presented a week through week 74. And what we showed here, and again this is the modified intent to treat and exclude those two non-ambulant twins. But the rest of the population behave very similarly, had similar baseline six-minute walk test. So these are very similar groups with the exception of, as I mentioned, the treated group was older by more than half a year than the placebo group.
And you see here that the shaded areas where we would have expected the dystrophin to materialize, so the first part of the shaded area is the last time point in which we would have expected no dystrophin. From that point on, week 24. In the treated arm, we had confirmed dystrophin. And at week 48 in the placebo arm we had confirmed dystrophin in every patient.
So we really wanted to see what is the stability on walking test produced once dystrophin is being created. And so what we really have seen is the treated group has been consistent in terms of really no meaningful decline from baseline. Again, that's less than 5% decline over essentially a year and a half of treatment.
The placebo group which started to show that decline as early as week 24, continue to see that decline until we were able to start to produce the dystrophin. And then again we confirmed dystrophin at week 48. And you can see we've essentially had very little decline in six-minute walk in the placebo group after we were producing dystrophin.
And importantly, we change the scope of the curve. This is rarely, I mean, if ever seen in Duchenne, particularly when you start to see the type of decline we were seeing in the placebo patient. You start to get worried that they're going to be quick to lose ambulation.
That was the previous slide I showed maximum score. This was what was pre-defined in our protocol because we believe that using maximum score would take out any outliers of a bad day on both the placebo and the treated group.
But the better way to look at this when comparing to natural history is looking at the mean. We took two measures at baseline and this is the mean of the highest and lowest score. And here, you can see there is essentially no change in the treated group from baseline.
And again, the numbers changed a little bit, but it doesn't change the magnitude of the effect and it doesn't change really the stabilization that we're seeing. And we also looked at this. It's not shown here. But our minimum score, we looked at day one score. The treatment effect is consistent. The difference and advantage for the placebo is the same no matter what analysis we look at.
And I wanted to share a little bit on natural history because it's important to look at this in the appropriate context in what we're actually doing to alter the course of the natural history of Duchenne of this disease. This is an article that was most recently published on the natural history, most longitudinal look on the natural history of Duschenne. And there was a specific intent to look at what are those predictors of rapid decline.
And what we understand now is that you really need to look at greater than seven-year old population to expect patients on the client. If you enroll patients who are four, five, six years old who are walking, they can be improving while on placebo. So it's important if you look at any comparative analysis in the space Duchenne space that you understand what's the inclusion criteria because we expressly excluded those patients that might have been growing even without treatment.
And so not only that that we include only those seven years and above, but I showed you earlier that we had over nine years of baseline. And you'll see that they're much older now as a cohort. Also on the left, you see, and this is important to point out, that the authors of this looked at baseline six-minute walk and what was more predictive of a chance to lose ambulation. And their recommendation was any patients below 330 should be excluded from an analysis of ambulation and treatment effect because they're much more likely to rapidly lose ambulation.
In fact, the two twins that are highlighted earlier, they were below 250, you see a 50% chance of losing ambulation over a one to two-year period. And that was consistent with what we saw before the treatment effect and the twins that I mentioned.
So here's just the summary table of the natural history. And what we boxed here is those that are consistent with our study including criteria of greater than seven years of age. And you can see, well, the Mazzone paper is probably the most comprehensive dataset.
They didn't lose as much in the first, only 11.5%. That contrast with Craig McDonald's work in the older than seven, which is a little more advance disease than ours where they lose 36% the first year. But there's no denying that over a one to two-year period, they're losing about 30% to 40% of their walking distance on the six-minute walk test.
You compare that to our Eteplirsen Placebo, and again we saw 15% decline or 56 meters over 36 weeks and not quite a year because then we started to producing dystrophin. So we didn't have a year of placebo in the study.
Interestingly, most of these patients were on steroids like our population was. In the patients that were not on steroids, they did a comparison analysis. And all of the author's report that greater than seven years of age, steroid use did not have a difference. There was no significant difference in outcome and slip of decline comparing steroid or non-steroid use.
So now what I’ve overlaid in green here is what’s happening to our population now that they’re on Eteplirsen and producing dystrophin? And you see a markedly different outcome.
In the Eteplirsen early treatment, a patient is either one that received treatment of Eteplirsen from week one. We saw at 48 weeks comparing a year 13-meter improvement, this is using the mean scores as I mentioned. And then over 74 weeks, not quite two years, again, they’ve lost essentially nothing, less than 1% decline on six-minute walk.
When you look at the placebo crossover, importantly they started now, after they declined and before dystrophin was produced, at less than 330 meters, I mentioned that was highlighted from a recent study of a higher predictor. In fact they recommended this should be patients who would be excluded from studies like this and yet we stabilized their walking ability as well out to – this is after 50 weeks of treatment and again from week 36 or the last point that we didn’t have confirmed dystrophin, they only lost 3% from that time point.
And we recently shared the individual patient scores. When you have a small sample size we often get the question “Well is this being driven by an outlier to its driving your ‘mean analysis’?” Well you can see here, that’s not the case, right.
Even at week 36, the last time point before we head dystrophin starting to be produced in every patient, every treated patient did better than every placebo patient. Every placebo patient declined by more than 15% from baseline, none of the treated patients did.
The two that you see in yellow here that declined more than 10% but less than the placebo patients, they happen to have been the oldest patients in the entire study, okay which put them at much greater risk of loss of ambulation and yet we still we believe blunted what would be expected in terms of loss of walking ability.
And the one outlier if you will that was better than average was the youngest patient in the entire study where you would see the ability to actually improve might be present if you start treating younger and healthier patients because they still have a lot of their muscle mass. And the ability to actually see them get a little closer to normal we believe is enhanced because they’re still had preserved most of their muscle mass.
But more importantly from week 36 to week 74, when every patient had confirmed dystrophin at robust levels at week 48 you see stability across the entire patient population at this point. And this is importantly at age, what their average age was at 74 weeks is over 10 years of age, the Eteplirsen group is almost 11 years of age. They’re on average of more than 11 years now as we speak and sit here today. So this is important.
And again the placebo delayed treatment had now been stable for 38 weeks and we will continue to report on other updates on this outcome.
So safety in summary has been very good. We’ve had no treatment related adverse events that are clinically [inaudible] through 74 weeks. We did have one case of transient urine protein through 74 weeks that resolved in 24 hours did not show any evidence of any kidney specific marker elevations.
And this is our serious adverse table or AE’s leading to treatment interruption or discontinuation, we’ve had none of those. We did look at a lot of AEs of special interest that are reported on other drugs in the DMD space. And again the one incidence of “renal toxicity” the transient proteinuria also had occurred in a placebo patient and then we had one injection site reaction if you will obtain but that did not – we did not have any patients who had erythema or induration or discoloration of any of the injection site. So it was a very well-tolerated drug to take weekly.
The milestones that we reported recently that the FDA requested two additional summary documents one on dystrophin as a surrogate marker that would reasonably predict clinical benefit and then the other one is the clinical outcome summary with which allows them a more comprehensive review of the data before they make the final decision on whether or not this would be an acceptable package for an MDA filing under the Accelerated Approval Pathway.
As we mentioned, we’ll be submitting those documents by month’s end and then we’ll have hopefully more clarity on what type of follow up and when that follow up will occur with the FDA. But we don’t have guidance on that at this point.
We also need to talk about CMC issue and confirmatory study. So there are further interactions that we’ll need both informally and formally with the FDA through the course of the next six months.
And again, we just highlight that there are a lot of mechanisms in place where this type of study for this type of disease is amenable to pathways for approval. I won’t go through all the details here, but the Accelerate Approval Pathway has been expanded with the recent FDASIA legislation that was passed. And we believe as was highlighted in a white paper by PPMD recently that Duchenne fits squarely in this rare disease of serious unmet medical need where there are no or few treatment options that exist.
And you can see just from recent communications this part year, the higher head [ph] of the FDA understands this and wants to make it clear that there are pathways when you have a treatment that is showing robust benefit in small populations early, that they are flexible for these types of approvals.
Again, quickly the first drug that we have in the pipeline and the next few are feasible to do clinical studies, but after that it’s a long tail and we would need to be amenable to a class approval.
We recently strengthened our IT position to be able to leverage our platform across broader DMD population. And again this strengthened not only geographically across exon targets and more optimize sequences.
And again Eteplirsen is a nice commercial opportunity in it of itself, but more importantly if we can get all of the drugs to the patients who need them, this presents not only a great thing for our patients with this devastating disease but also can really catalyze this company for the future.
And again it doesn’t stop there. Our chemistry we think is uniquely differentiated and can go after other disease areas. We have continued to advance our technologies beyond the [inaudible] that’s in the clinic and again directed alternatives, splicing [ph] we think is very promising for the future and other disease areas.
Again in summary our closing share price yesterday was $37, that’s put us at about $1.2 billion valuation on outstanding shares. We have good trading volume and liquidity and we ended the first quarter with $175 million in cash.
So thank you very much for your interest in the Sarepta story. We do have a breakout across the hall. Thank you.
[No Q&A Session for this event]
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