CRISPR Therapeutics AG's (CRSP) CEO Sam Kulkarni At Piper Sandler 33rd Annual Virtual Healthcare Conference (Transcript)

CRISPR Therapeutics AG (NASDAQ:CRSP) Piper Sandler 33rd Annual Virtual Healthcare Conference Call December 2, 2021 1:00 PM ET

Company Participants

Sam Kulkarni - Chief Executive Officer

Conference Call Participants

Ted Tenthoff - Piper Sandler

Disclaimer*: This transcript is designed to be used alongside the freely available audio recording on this page. Timestamps within the transcript are designed to help you navigate the audio should the corresponding text be unclear. The machine-assisted output provided is partly edited and is designed as a guide.

Ted Tenthoff

00:05 Hi, everybody. My name is Ted Tenthoff. I’m a Senior Biotechnology Analyst at Piper Sandler. And thanks for joining us for this year's virtual healthcare care conference. CRISPR is the leading developer of CRISPR Cas9, [indiscernible] gene editing therapies. The company has demonstrated the curative potential of CTX001 in sickle cell disease and beta thalassemia.

00:27 Additionally, CRISPR is advancing a pipeline of three gene edited CAR-T programs and also a potentially curative therapy for type 1 diabetes with partner ViaCyte. With us from CRISPR is my good friend and CEO, Sam Kulkarni. Sam thanks so much being with us today.

Sam Kulkarni

00:44 Thank you for having us.

Ted Tenthoff

00:46 So, at this point, I believe everyone knows [Technical Difficulty] maybe you can provide us kind of a high level view of your approach to developing this revolutionary technology, starting by gene editing therapies and ultimately moving in vivo.

Sam Kulkarni

01:04 Yeah. Thank you, Ted. It's nearly ten years since Dr. Emmanuelle Charpentier and Dr. Jennifer Doudna developed the CRISPR technology. It's hard to believe that this elegant system for engineering DNA came out of bacteria in a bid to protect themselves against viruses, but what was developed with this elegant technology platform, which essentially can be envisioned as a pair of molecular scissors attached to a barcode, which can then be sent anywhere in the genome to make a cut in a genome or make an edit in the genome to fundamentally change the complexion of how we treat diseases by treating them at the DNA level as opposed to the RNA or the protein level.

01:53 And the technology itself is very powerful, I think every thirty to forty years, we've seen a major technological discontinuity and CRISPR represents one of those major discontinuities and our mission as CRISPR Therapeutics was to take this platform and make transformative medicines using this powerful technology.

02:17 And as with any technology cycle, the idea is how do we de-risk the platform in indications where we understand the generics of the disease, understand the methodology by which we engineer the cells and there's some natural history data to support it, which led us to sickle cell disease and beta thalassemia.

02:38 Sickle cell is one of the oldest known genetic diseases. It's over seven years since we discovered that a molecular one mutation in our genome causes sickle cell disease. And we understand the disease well and the methodology of using cells outside the body or other words ex-vivo to engineer them and use that as a therapy to treat sickle cell was a good initial bet and the data so far transformative and we'll talk more about it.

03:11 But then we want to expand that from rare diseases into common diseases. And if I look today at the biggest causes of mortality, Number one is heart disease, Number two is cancer, and Number three, though not directly every time is diabetes. And where we evolve our portfolio now, we're going to try to address a lot of these common diseases as well, which ultimately should lead to not just amelioration of the disease, but to human longevity.

03:43 So, it's quite exciting what the possibilities are with CRISPR and the platform and we continue to execute on the vast potential that is represents.

Ted Tenthoff

03:55 Very exciting indeed. Perhaps you can describe CTX001 [Technical Difficulty], but tell us how it really worked. And [Technical Difficulty].

Sam Kulkarni

04:11 Yes. Thank you. Thank you for that question Ted. I think CTX001 is our therapy where we take cells from the patient and these are patients that are suffering from thalassemia or sickle cell, send it to our manufacturing facility, engineer these cells using CRISPR Cas9, send the cells back and after the patients go through a procedure, whether original cells are [myeloblated] related, you then get this CTX001 therapy.

04:42 We've shown data for nearly twenty plus patients now. Fifteen thalassemia and seven sickle cell patients. And all these patients were functionally cured, after treatment with CTX001.

04:57 Just to bring it to life, we have patients in the sickle cell trial that had severe pain, they had five to six hospitalizations per year and each of these ended up with many of these ended up with them in the ER, with the risk of mortality.

05:17 All those patients, you know, they're essentially hospitalization free or VOC free since treatment with CTX001. The thalassemia patients came in, some of them requiring more than one transfusion a month to just function with their basic life to walk ten steps and those patients have all been transfusion independent since treatment CTX001.

05:42 It's just incredible data. And I think now we have the opportunity to get therapy like it's approved and bring it at scale to all patients suffering from these diseases. So, we're working closely with our partner Vertex Pharmaceuticals to meet all the regulatory requirements to be able to file this drug with the FDA and the other regulatory authorities and we're in the meantime we continue to execute on our clinical operations and bring more patients into the trial as necessary.

Ted Tenthoff

06:18 Yeah. Really incredible. And earlier this year, Vertex purchased an additional ten percent of CTX001 globally for a total of one point one billion. So, tell us about their plans to register this innovative novel therapy and what CRISPR’s retained economics are?

Sam Kulkarni

06:39 Yeah. I think this program started off as a fifty fifty partnership between CRISPR and Vertex and we both brought complementary expertise to the table. We had a lot of expertise in gene editing, understanding these diseases, in manufacturing and Vertex had a lot of experience in regulatory, clinical operations, and also commercialization.

07:01 As we got to point where we have data that's quite exciting, and we now have to think about how to commercialize this drug, I think it made sense for one party to, sort of take the lead in commercializing globally. Especially given the commercialization in the U.S. versus ex-U.S. will be quite similar in terms of the model.

07:21 And with that came the opportunity to structure the deal and Vertex were quite enthusiastic about the program and the prospects. And it made sense for us to shift the balance to sixty forty, give Vertex control on the commercialization aspect where they already have an existing commercial organization, but also supplement our cash balance so that we can continue to invest in opening new opportunities for the platform, including low intensity conditioning, which may directly impact how many patients are eligible for CTX001 and what the addressable market there is.

Ted Tenthoff

08:04 And routine great downstream economics. So, I'm going to switch gears to one of these places where you guys are investing this hard earned money allogeneic CAR-T programs. First off, describe what CTX110 is and walk us through the phase one carbon data that you've reported today?

Sam Kulkarni

08:24 Yeah. Happy to. This should remind everyone. The fundamental that we're making is that smart engineered cells are the best way to kill cancers. We've declared this modern war on cancer about sixty years ago. This was when Dr. Sidney Farber and his colleagues said, we are going to throw everything we have at cancer and try to kill cancer, right.

08:49 We started off with the decade or so of combining a lot of toxic chemicals to see if you can get rid of cancer, more targeted therapies beyond that, but still combinations, an era of antibodies. And while we made some progress, cancer continues to be the reason for nearly twenty percent of mortality in society today.

09:12 What we have at our hands now is cells that are immune cells that have been engineered using CRISPR or any gene editing to be able to recognize the cancers and kill the cancers. And that's a very powerful concept. And we believe that we want to be, you know we are best equipped to be at the forefront of that wave because we have the best editing capabilities and we have all the manufacturing capabilities for cells.

09:41 With that, our first generation programs, CTX110, CTX120, and CTX130 target CD19 BCMA and CD70. With our CD19 program, that CTX110 we disclosed data about a month ago, where we showed that a single dose of engineered immune cells from a healthy donor injected into a cancer patient can make them cancer free for an extended period of time. I think to the extent that we've measured we had patients out over a year who were cancer free with a single dose of CTX110. This is after they failed three other lines of therapy.

10:26 And that's a very powerful concept. I think in the moment of comparing data with between ten different drugs people lose sight of the fact that it's a historic moment. We've opened up the era of smart cells and cancer and we now believe that we can tweak the regimen, do consolidation dosing where we get two doses to one, improve the lymphodepletion and all that to further enhance the data. And I think make it equivalent to autologous therapies, where you've seen several patients benefit quite meaningfully from CAR-T, but with all the issues around not having the drug off the shelf.

11:11 So, we think commercially it has tremendous prospects, the clinical profile is one that we believe can be approval as further bolstered by the fact that we just received RMAT Designation from the FDA who carefully looked at the data and the product profile. And I think that bodes well for how we can move forward with the pivotal trial and get to not just our CTX001 BLA, but a second BLA, which would we remarkable for a company to achieve within the first ten years of its existence.

Ted Tenthoff

11:44 So, Sam, tell us what the next steps are for CTX110.

Sam Kulkarni

11:50 Yeah, at this point, we're kicking off the pivotal little trial in earnest. We hope to enroll and dose as many patients as we can all through next year. We'll obviously have interim data readouts as we dosed patients, but it's really pedal to the metal in enrolling patients and getting to a sufficient number of patients. Typically these trials are about a hundred patients to hundred and twenty five patients to get to all the patients we need in the trial and then wait for the data to fully mature and to get us to a BLA filing.

Ted Tenthoff

12:26 Yeah. Really exciting. And you really took some learnings from that initial carbon data to apply both the CTX120 and CTX130 to actually do multiple dozing. So, tell us about the status of those two programs and when can we get data in a multiple myeloma and also [male strobing] [ph] in solid tumors?

Sam Kulkarni

12:48 Yeah. Absolutely. I think ultimately, eighty percent of cancer patients die of solid tumors and these are solid tumors like lung cancer, renal cell carcinoma, GBM etcetera. And, you know, while we’ve seen autologous CAR-Ts have really good data in hem malignancies, which are blood cancers, we haven't seen that effect in solid tumors. But if you can get allogeneic CAR-Ts to start having activities in solid tumors, that just opens up a whole new area in terms of the ability to impact cancer.

13:23 In fact, get to a point where you can think about cures when you get to early lines of therapy. So, for us CD70, CTX130 is a CAR-T where we have trials ongoing both in hem malignancies as well as solid tumors. So that's something that we'll readout out and we are implementing the consolidation protocols in that trial as well. And then [DCMA] [ph] is a known target whether in multiple myeloma where, again, we believe that redosing can have an effect in terms of improving the data.

13:59 So, I think we continue to be pedals of metal in terms of enrolling patients and moving those trials along, I think we'll have some decisions to make in terms of what the data look like and what – how we progress in each of those trials in twenty twenty two, but we certainly will have updates on how those trials are progressing.

Ted Tenthoff

14:23 Great. Sam, I’ve got two questions coming in from audience. I'm going to give them both in one since they both are regarding the allogeneic CAR-Ts. So, firstly, can you provide some insight into what if any considerations are being taken to address CMC or manufacturing concerns and bottlenecks as these therapies both CTX001 and CTX110 advance towards the market. And the second question is, any consideration of teaming up with [linear] [ph] cell therapy for development of allogeneic cells?

Sam Kulkarni

14:57 Yeah, I think on the first question on CMC, this is, I think one of the things that we have that's important that we build for us in the get go was to actually make sure that we have our CMC readiness for a commercial process right from the get go, even when we start the trials. We don't want be changing process in between trials. And with that notion of that philosophy, we are in a place where we have all the CMC readiness elements to be able to get these to commercial approval.

15:35 In fact, we're excited to tell you that we have our own manufacturing facility now online in framing Massachusetts, where we have several suites where we can process these cells, mainly utilize for our immuno-oncology manufacturing, but it's manufacturing at commercial scale in this facility.

15:55 And I think CMC is something we take very seriously, but also happy to say that we don't have major concerns about the progress of our programs on account of CMC issues. I'm not familiar with linear therapeutics, but know, I think my guess is this has to do with IPS to ourselves. There a number of companies trying to work with these types of programs.

16:22 A lot of it, we believe, we actually have a capacity in-house, but we have been pretty open about doing partnerships. We've now done two fifty fifty partnerships one with InCarda Therapeutics, one in [NK Cells] [ph], and then we've done one with Capsida on cells that – on AV vectors to take our CRISPR CAT line in vivo. And those are both really good collaborations where we bring our complementary technologies together.

16:56 So, I think we would consider that for any companies that have promising technologies.

Ted Tenthoff

17:02 And another exciting area to apply the technologies were generative medicine and here you partnered was ViaCyte, which recently announced that Health Canada cleared the CTA for VCTX210. Please describe this program and how it works and how you intend to develop it as a potential cure for type one diabetes?

Sam Kulkarni

17:24 We're incredibly excited about this whole vertical of regenerative medicine. It's this world. We've lived in a world where organ donors have been scarce, right. I think it's been very difficult to get donors or organs to be replaced because one, you don't get them [indiscernible] organs that are available.

17:51 Second, I think when we relied on for some tissues like hard tissue with pig donors they don’t always work well in the human system. So, you haven't had a source, you know, factory made organs for instance, you haven't had that. But now with CRISPR engineering, you have the ability to mass produce organs, you know and treat a number of common diseases with organs made at scale.

18:21 Our first foray is with the pancreas where we take stem cells and make islet cell progenitors and put them in a device and implant them as artificial pancreas into your body, but we could do the same for liver. We can do the same for kidneys.

18:38 So, a little harder for some other organ systems like the heart and the brain, but, you know, this whole notion of, you know, off the shelf organs that you can use to treat patients is very powerful that I think the future is trending in that direction. Not only for treating these diseases, but for enabling longevity of humans.

19:02 If you are able to get to artificial pancreas, artificial livers, and artificial kidneys, I think you're easily adding, you know, ten years to the average life span of humans, and this is something we're quite excited about. Our first foray in partnership with ViaCyte is in type one diabetes where we take stem cell derived islet cell progenitors from a [indiscernible] size device and implant them into patients. And here, we want to see do those cells produce insulin in response to glucose.

19:38 And that I think could be very interesting experiment, and we'll have some data early in the trials as we dose patients, which obviously we want get out there, but something we're putting a lot of energy behind and we are glad that we're in the clinic now with that program.

Ted Tenthoff

19:57 And I believe that ViaCyte has actually shown some data that they can do it. It's just the immune issues of these cells being rejected. So, I believe what you're doing is really knocking out some of these immune cells so that these patients could essentially get the equivalent of an islet cell transplant without lifelong immunosuppression. Is that the general approach, general goal?

Sam Kulkarni

20:23 Absolutely, I think this all comes from the Edmonton protocol. I think there were serious severe type one diabetic patients where you took cadaveric cells, cadaveric pancreatic islet cells and injected them into patients. And if they were immunosuppressed they showed very good data and they didn't have as many glycemic events.

20:43 But what we're talking about here, with the first generation program that ViaCyte had, they had these stem cells derived islet cells in a device, but with immunosuppression. Now, that reduces the market applicability to only the severe type one diabetes patients that are willing to be to be immunosuppressed.

21:04 And especially in this age of COVID, and everything that's going around with our edits these cell become stealth, you don’t need do immunosuppress the patient. So, the cells will survive in the patient for a long period of time with the edits. At least that's the hope, in which case you don’t have to immunosuppress.

21:24 So that raises the possibilities, it's not just for type one diabetes, it could be for type two diabetes. You know, in fact, every diabetic person could leverage a device that's producing insulin, and that's quite exciting.

Ted Tenthoff

21:36 Very, very cool stuff. Now, there's been a lot of significant progress advancing in vivo gene editing, Sam tell us a little bit about some of your early programs including those that you're working on with Vertex.

Sam Kulkarni

21:49 Yeah. You know, this is a less appreciated fact for our company, you know, given the fact that we made so much progress with ex vivo therapies, people think of us as an ex-vivo company, but we actually have more programs with in vivo approaches than ex vivo approach at this point. We have more than half a dozen programs that target different rare diseases that utilize either an AAV approach or a lipid nano particle approach to deliver the CRISPR Cas9 to the organ of interest.

22:21 You know we have a lower directed program for instance, GST1a of Hemophilia A where we take lipid nanoparticles and calculate the CRISPR Cas9 and deliver that into the bloodstream that then is directed towards the liver. And those programs are moving towards the clinic. We have a number of program where we take AAVs or Adeno-associated viruses to encapsulate the CRISPR Cas9 mechanism for programs like DMD cystic fibrosis, DM1, [indiscernible] that's in the brain, ALS, which is the debilitating disease, that again is required delivery to the brain.

23:05 Those two are part of the Capsida collaboration, ALS and Friedreich’s Ataxia. So, I think you know, there's tremendous progress being made across many fronts. And I think eventually, we're going to figure out not just delivery in vivo to deliver, but to several other organ systems, including muscle and the brain.

Ted Tenthoff

23:28 And a really exciting time, and I didn't miss your references to extending longevity. Now, CRISPR ended the third quarter with almost two point five billion, how long will this fund the company and what does it fundamentally enable you to accomplish?

Sam Kulkarni

23:45 I think it's an enviable cash position for – in the biotech world, I think there haven't been many companies with this type of cash balance without having a commercial product on the market and speaks to the potential that this platform offers. I think we've built up this sort of cash balance because we find many opportunities to continue to invest in that utilize the CRISPR platform.

24:12 At this point, if you look at our burn rate, we have well over four years’ worth of capital, if you continue in the same vein, but we obviously want to get more aggressive with where we're spending our money and how we – as we take more programs into the clinic. It also allow us to do deals where we bring in technologies and further bolster our toolkit, which not all companies are able to do.

24:41 And at this point, we have all forms of editing that we do, including enhancements to the original CRISPR Cas9 gene editing with, you know by adding base editors or integrations or other forms of editing on top of it. And we have our own small Cas9 that we don't talk about much, which can fit neatly into an AAV or even a smaller Cas9 that has high fidelity cutting.

25:10 So these are all things we're improving in the background as we sharpen the toolkit to be able to attack new diseases and make a transformative difference in lives of patients.

Ted Tenthoff

25:23 Great. Sam, thanks so much for being with us today. Keep up all the great work.

Sam Kulkarni

25:28 Thank you, Ted.

Question-and-Answer Session

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