Editas Medicine, Inc. (EDIT) CEO Cynthia Collins on Q1 2020 Results - Earnings Call Transcript

Editas Medicine, Inc. (NASDAQ:EDIT) Q1 2020 Earnings Conference Call May 7, 2020 8:00 AM ET

Company Participants

Mark Mullikin - Mark Mullikin, Vice President of Finance and Investor Relations

Cynthia Collins - President and Chief Executive Officer

Charles Albright - Executive Vice President and Chief Scientific Officer

Michelle Robertson - Chief Financial Officer

Conference Call Participants

Operator

Good morning. Welcome to Editas Medicine's First Quarter 2020 Conference Call. All participant lines are in a listen-only mode. There will be a question-and-answer session at the end of this call. Please be advised that this call is being recorded at the company's request.

I would now like to turn the call over to Mark Mullikin, Vice President of Finance and Investor Relations at Editas Medicine.

Mark Mullikin

Thank you, operator. Good afternoon, everyone, and welcome to our first quarter 2020 conference call. Earlier this morning, we issued a press release providing our financial results and corporate updates for the first quarter of 2020.

A replay of today's call will be available on the Investors & Media section of our website approximately two hours after its completion. After our prepared remarks, we will open the call for Q&A.

As a reminder, various remarks that we make during this call about the company's future expectations, plans, and prospects constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995.

Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our most recent annual report on Form 10-K, which is on file with the SEC.

In addition, any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. Except as required by law, we specifically disclaim any obligation to update or revise any forward-looking statements, even if our views change.

Now, I will turn the call over to our Chief Executive Officer, Cindy Collins.

Cynthia Collins

Thank you, Mark. Good morning and thank you everyone for joining us for our corporate update call for the first quarter of 2020. In addition to Mark, I am joined by Charlie Albright, our Chief Scientific Officer; and Michelle Robertson, our Chief Financial Officer.

This year has started out quite unlike any other for the world and for our company. The COVID-19 outbreak is a challenge unprecedented in modern times. The safety of our employees, patients, and partners is always our first priority, and I want to thank them for their resilience in the face of adversity.

We have taken measures consistent with public health policy and guidance to keep them safe while minimizing business disruptions. This includes implementing a work-from-home policy for office-based employees, while restricting on-site activities to essential lab and manufacturing employees. We are successfully conducting much of our business virtually, and our executive team meets frequently to ensure that we continue to advance our business objectives.

We have been able to keep our programs largely on track, although the uncertainty does increase the risk to timeline, which will be discussed further on this call. The situation is unfolding rapidly, and we will provide further updates as we gain additional clarity on potential impact.

Now, I will turn to a review of our business. Since we last spoke in February, we achieved a historic milestone with our lead program EDIT-101, the first in vivo CRISPR medicine was administered to a patient in the BRILLIANCE clinical trial for the treatment of LCA10. This is a landmark event for science, for medicine, and most importantly for people living with this ocular disease, and it is a significant step for delivering on the promise and potential of CRISPR medicines to transform the lives of patients with devastating genetic diseases. Charlie will provide additional color on the trial in a few moments.

As thrilled as we are to pioneer the first ever in vivo CRISPR medicine, we are equally excited about pioneering differentiated, engineered cell medicine for cancer and hemoglobinopathies.

We recently initiated IND-enabling studies for oncology candidate EDIT-201, an allogeneic healthy-donor NK cell medicine for the treatment of solid tumors. Advancing novel treatments for solid tumor cancers, which represent approximately 90% of cases is a key priority for our company. We expect EDIT-201 to be the first transformative oncology medicine to emerge from our efforts.

For hemoglobinopathies, we are conducting IND-enabling toxicology studies for EDIT-301 for the treatment of sickle cell disease. We remain on track to file an IND for a potentially best-in-class medicine by the end of this year.

Finally, before I turn the call over, I am pleased to welcome Clare Carmichael to Editas as Chief Human Resources Officer. Clare joined us in April. She brings deep experience in building biotech organizations and will be instrumental as we continue to grow Editas as the leader in genomic medicine.

Now, let me turn the call over to our Chief Scientific Officer, Charlie Albright to discuss our pipeline.

Charles Albright

Thanks, Cindy. It's my pleasure to join all of you on the call today. Let's start with in vivo editing medicines, the first pillar of our therapeutic strategy. In early March, along with our partner Allergan, we announced the treatment of the first patients in the BRILLIANCE clinical trial, EDIT-101 to treat LCA10.

As a reminder, the primary endpoint of BRILLIANCE assesses the safety and tolerability of EDIT-101, the secondary endpoints measuring efficacy. We're pleased to report that based on a review of the first six weeks of safety data from the first patient, the study has been cleared to continue.

We plan to complete dosing of the adult low dose cohort and to dose at least one patient in the adult mid dose cohort by the end of this year. We will keep you up to date on our progress, including any potential impact of COVID-19 on our enrollment activity.

From EDIT-101, our next in vivo ocular program is EDIT-102 for the treatment of Usher Syndrome 2A. Preclinical study supports the advancement of EDIT-102 into IND-enabling studies. As part of our strategic alliance with Allergan, we've delivered a data package for EDIT-102 for potential licensing and development. We expect Allergan's decision by the third quarter after which IND-enabling studies may begin.

Our third ocular program addresses autosomal dominant retinitis pigmentosa 4, or RP4, a significant unmet medical need. While we've made substantial progress on this medicine, we will delay the declaration of a development candidate to next year due to the need to reprioritize staffing caused by COVID-19. We remain eager to advance this program, and we'll make every effort to declare a candidate as soon as practical.

We also continue to advance our neurology program in collaboration with AskBio, and we'll have more to say about our in vivo editing programs later this year.

Switching now to engineered cell medicines, the other strategic pillar of our therapeutic strategy. As Cindy mentioned, EDIT-301, our potentially best-in-class medicine for hemoglobinopathies remains on track for an IND filing for sickle cell disease this year. Preparatory activity supporting the IND are under way. Site selection will begin shortly, and we are planning for an investigator meeting in the fourth quarter.

EDIT-301 directly edits the beta-globin locus where the mutation that causes sickle cell disease is located. We believe that editing of the beta-globin locus is derisked by human genetics since some sickle cell patients with elevated fetal hemoglobin contain mutations in the beta globin locus. In contrast, mutations that elevate fetal hemoglobin in humans are not found in other genetic sites.

In addition, preclinical data shows that EDIT-301 induces superior levels of fetal hemoglobin and reconstitutes all blood lineages including red blood cell precursors. For these reasons, we remain enthusiastic about advancing EDIT-301 into the clinic to treat sickle cell disease patients.

Finally, moving to oncology, an area of significant and growing investment for our company, we recently initiated IND-enabling studies for EDIT-201, an allogeneic NK cell medicine treating solid tumors. We believe that we can apply gene editing to NK cells to develop off-the-shelf medicines for cancer patients that have no effective therapeutic options available to them today. EDIT-201 is the first of these medicines that we hope will extend and dramatically improve the lives of these patients.

We're continuing to make excellent progress on our program to produce NK cells with multiple genetic changes from induced pluripotent stem cell. We'll have more to say about these efforts later in the year.

Now, I will turn the call over to our Chief Financial Officer, Michelle Robertson.

Michelle Robertson

Thanks, Charlie. I'm pleased to join you on the call today to present the company's latest financial results. Our cash, cash equivalents, and marketable securities decreased $42 million to $415 million as of March 31, 2020, from $457 million as of December 31, 2019.

Our uses of cash in the quarter totaled $58 million. Cash operating expenses of $56 million exclude stock-based compensation and depreciation and include changes in working capital. After adjusting for non-recurring cash payments in Q1, our cash operating expenses were approximately $40 million.

Capital expenditures in the quarter totaled $2 million.

We grew the size of our organization by approximately 10%, increasing to 213 full time employees from 195 employees at the end of 2019.

Editas is in a strong financial position with more than 24 months of runway to fund the business.

Further, we remain committed to diligently managing our expenses in order to grow the company, while maintaining the strength of our balance sheet.

And with that, I will hand it back to Cindy.

Cynthia Collins

Thank you, Michelle. The beginning of this year brought in unprecedented global crisis that has changed the way Editas and every other company operates. We are confident that our strong leadership, dedicated employees, and trusted partnerships will persevere during these difficult times.

The healthcare and biotechnology community has always emphasized progress and development under strenuous circumstances, and I am confident that together we will overcome this global pandemic.

As a company, we remain incredibly excited about the times ahead. Editas programs have the potential to revolutionize the treatments of genetic blindness, cancer, sickle cell disease, and neurological conditions.

Earlier this year, we treated the first patient ever with an in vivo CRISPR gene editing medicine, but our work is only getting started. We are working to further extend the reach of gene editing as we tackle new indications, explore new targets and expand our platform to deliver on the promise of CRISPR technology.

We look forward to continuing to forge this journey in partnership with the broader community of patients, clinicians, employees, and investors.

We thank all of you for your continued interest and support. With that, we will open up the call for Q&A. operator?

Question-and-Answer Session

Thank you. [Operator Instructions]. And I'm not showing any questions at this time.

Cynthia Collins

Great. So, with that, we thank you all for participating in today's call and for your support as we work to bring transformative new medicines to patients.

Take care and be safe.

Operator

Ladies and gentlemen, this concludes today's presentation. Thank you once again for your participation. You may now disconnect.