Applied Genetic Technologies Corporation

Good morning and welcome to the AGTC Financial Results Conference call for the second quarter of fiscal year 2022. Today's call is being recorded. Before we get started, I would like to remind everyone that during this call, AGTC may make forward-looking statements, including statements about the company's financial results, financial guidance, its future business strategies and operations, and its product development and regulatory progress, including statements about the timing, and outcomes from data expected in its Skyline and VISTA trials and the type of data that may support registration and potential approval. Actual results could differ materially from those discussed in these forward-looking statements due to a number of important factors, including uncertainty inherent in the clinical development and regulatory process, the extent and duration of the impact of the COVID-19 pandemic, and the other risks described in the risk factor section of AGTC's most recent filed annual report on Form 10-K and other periodic reports filed with the SEC. AGTC undertakes no obligation to update any forward-looking statements after the date of this call. For introductions and opening remarks, I'd like to turn the call over to Sue Washer, Chief Executive Officer of AGTC. Please go ahead.

Good morning, and thank you all for joining us. With me on today's call are Susan Schneider, our Chief Medical Officer, and John Lieber, our Chief Financial Officer. During today's call, I'll review our recent accomplishments before Susan reviews the recently reported data from the achromatopsia B3 trial. She will then discuss our plans for reporting data from the X-linked retinitis pigmentosa, or XLRT, phase two Skyline trial, and provide guidance on how we intend to measure this trial's success. John will provide an update on the build out of our manufacturing facility, review our financial results for the second quarter of fiscal year 2022, and discuss our upcoming milestones. After our prepared remarks, we'll take your questions. In the second quarter, we made significant progress in our lead clinical programs and met important business objectives. Key accomplishments in our XLRP program included reporting additional data from the ongoing Phase I-II clinical trial of AGTC501, our XLRP gene therapy candidate, and completing enrollment in the Skyline trial. Last week, we reported data from the highest-dose pediatric group in our ongoing Phase I-II achromatopsia trials. These data are consistent with the previously reported adult data. Importantly, based on the data generated to date, we intend to advance our AGTC-401, our product candidate for patients with a CNGD3 gene mutation that causes achromatopsia, into the next stage of clinical development pending feedback from an end of Phase II meeting with the U.S. Food and Drug Administration, or FDA, expected in the first half of this year. With respect to the dose, we believe that the 1.1e to the 12 vector genome per mil dose, which is the dose group five in the Phase I-II trial, is an appropriate dose to move to the next stage of clinical development. Specifically, two pediatric patients in this dose group were responders based on improvements in visual sensitivity. Therefore, of the three adults and four children for a total of N equals 7 in that dose group, and including the two adult responders, four patients are greater than 50% are visual sensitivity responders. These patients also had improvements in quality of life as measured by a patient-reported outcome survey, or PRO, developed specifically for patients with achromatopsia. During the quarter, we also added several talented individuals to our leadership team in order to support advancement of our clinical and preclinical programs. We welcomed Hope Doiley-Gay as General Counsel and Dr. Abraham Scaria as Chief Scientific Officer. Hope has more than 25 years of legal experience with the majority of her career spent in the healthcare industry and deep knowledge of pharmaceutical gene therapy and life science companies. Abraham also has more than 25 years of experience in the biotech and pharmaceutical industries with extensive knowledge in discovery research and early stage development and a focus on gene therapies to treat rare diseases. Most recently, he was the Senior Vice President and Chief Scientific Officer of Iverick Bios, where he was responsible for preclinical research and development for retinal disease therapies. Having recently welcomed John and Sue, who are participating in the call today, and Janet Ray, our Senior Vice President of Regulatory and Quality, the appointments of Hope and Abraham complete the newly expanded management team that has both the expertise and passion to continue developing our clinical programs and preclinical pipelines. We also appointed James Robertson, President and Chief Executive Officer of Eurovant Sciences, to our Board of Directors. James has nearly three decades of experience in the biopharmaceutical industry and has successfully led commercial operations at multiple companies. His insights will be invaluable as we move toward late-stage development and commercialization of our lead clinical programs. The combination of our expanding body of clinical data supporting the potential of our XLRP and achromatopsia B3 candidates and our seasoned and dedicated leadership further increases confidence in our ability to develop transformative gene therapies for patients that currently have no alternative treatment options. I'll now turn the call over to Susan for a discussion of our XLRP and achromatopsia B3 clinical programs.

Thank you, Sue. First, I will briefly review the data presented last week from our ongoing Phase 1-2 clinical trials of AGTC401 for achromatopsia due to mutations in the CNGB3 gene and AGTC402 for achromatopsia due to mutations in the CNGA3 gene. As Sue noted, In both achromatopsia clinical studies, we continue to observe a well-tolerated safety profile in all adults through the full 100-fold dose range with no dose-limiting toxicities. In pediatric patients, both achromatopsia product candidates show a similar well-tolerated safety profile as in adults, except at the very highest dose the 3.1e to the 12 vector genomes per ml dose group, where there was significant inflammation resulting in one suspected unexpected serious adverse reaction, or SUSAR, for AGTC401 and two SUSARs for AGTC402, all previously reported. Each of these patients have responded well to an adjusted steroid regimen, with intraocular inflammation resolved for two patients and significantly improved in the third. Importantly, at the second highest dose, the 1.1e to the 12th vector genomes per mL dose, or group five dose, no SUSARs, endophthalmitis, or drug-related serious adverse events have been reported in either the pediatric or the adult patients many of whom are past the 12 month time point. This generally safe and well tolerated profile is also consistent with earlier data out to as long as 24 months for the AGTC501, our XLRP product candidate. Of note, in our AGTC401 clinical trial, we have observed several adult responders out to 12 months based on visual sensitivity, light discomfort, and a quality-of-life questionnaire designed specifically to assess light sensitivity that impacts a chromatopsia patient. The most consistent responses are in dose group 5, which is a dose of 1.1e to the 12 vector genomes per mL. Importantly, for the AGTC401 pediatric patients, we also saw responders for visual sensitivity at this dose. For responders, the improvement in visual sensitivity was robust and durable in both adult and pediatric patients. Interestingly, this is also the dose with the best response in our XLRP clinical trial. This slide focuses on the seven group five patients. Importantly, four of the five patients in group five who were able to complete the perimetry testing, two adults and two children, had robust and durable responses, and several had improvements in one or more additional endpoints, including a measure of quality of life. We also observed that the two very young children, both five years of age, who were unable to complete the visual sensitivity test, had improvements in their quality of life survey, and one of them had improvements in best corrected visual acuity, or BCVA. Here you can see the visual sensitivity data as graphs over time for the two adult and two pediatric responders in group five that illustrate durable and robust improvements. In the graph on the left, the four responders averaged a six decibel improvement in mean visual sensitivity compared to baseline, which represents a 16 to 24-fold increase versus the contralateral untreated eyes that showed relatively little change over time. The graph on the right shows an even larger improvement in those responders that also met the hurdle of five loci increasing by seven decibels. Based on these data, we believe that AGTC401 has best in class potential for the treatment of achromatopsia B3, and we look forward to sharing information in the first half of this year on the next steps in clinical development following our end of phase two meeting with the FDA. Let's now shift our focus to our XLRP clinical program. As Sue mentioned, We reported additional data from the ongoing XLRP Phase 1-2 trial in the second quarter of calendar year 2021. Consistent with previously reported data, these additional results demonstrated a 50% response rate for Groups 5 and 6 based on micro-perimetry assessments and with best corrected visual acuity outcomes. we continue to show evidence of a biological response at month 12. Improvements in visual sensitivity also correlate with improvements in retinal structure. Furthermore, we are seeing evidence of a continued durability of response up to 24 months after treatment based on data from a subset of patients in the Phase I-II trial who have reached this time point. These data reinforce our belief that AGTC501 is a differentiated product candidate with best-in-class potential, and we look forward to reporting the full two-year data later in calendar year 2022. As announced last month, we completed enrollment in the Skyline trial. We exceeded the enrollment target for this trial, which we believe reflects the strong interest in our XLRP candidate among patients and physicians. As many of you are aware, Skyline is a multi-site masked phase two expansion of the ongoing phase one study in which patients are randomized to either a high or low dose of AGTC501 with the primary objective to identify the proportion of treated eyes that demonstrate improvement from baseline in measures of visual sensitivity and visual acuity as well as the patient's ability to navigate a mobility maze with changing obstacles and under varying light conditions. Importantly, this is our first clinical trial that has the potential to demonstrate a correlation between visual sensitivity and or visual acuity with maze outcomes, a new functional endpoint also added to the VISTA Phase 2-3 clinical trial. Skyline and VISTA use the same inclusion and exclusion criteria, which are based on baseline characteristics identified in the Phase 1-2 clinical trial utilized to predict responders. We are on track to report interim masked three-month data from Skyline in the second quarter of calendar year 2022. And today, I will provide guidance on our expectation for these data and review key clinical assessments performed in this clinical trial. Anticipated key takeaways for the Skyline Monthly Interim Analysis are summarized here. Based on the body of safety data from our Phase 1-2 clinical trial, we have confidence that Skyline safety outcomes will continue to show that our XORP candidate is generally safe and well tolerated. We also plan to report on the proportion of patients showing improvement in visual sensitivity in their treated eye. Based on the data cutoff time point for this interim analysis, we intend to evaluate data from the first 13 of a total of 14 patients enrolled in the Skyline trial. Data to date from the Phase 1-2 trial have demonstrated a 50% response rate in higher dose groups when including patients who meet the entry criteria for the Skyline and VISTA trial. And the VISTA trial is powered to show a statistically significant difference at a 50% response rate. I want to emphasize that at the time we present the three-month Skyline data, the trial will be masked. This means that while we will be able to report on responders in two groups, we will not know the specific dose group assignments. Outcomes will be reported only as dose group A and dose group B. We also expect that best corrected visual acuity will continue to show supportive evidence of a biological response with a difference between each patient's treated versus untreated eye. We plan to present these data as the number of eyes in dose group A and in dose group B with improvement over baseline of five ETDRS letters or more compared to the untreated eye. We consider this to be a response to treatment. While we have previously reported visual sensitivity and visual acuity data, the Skyline trial is the first that utilizes a visual navigation challenge, or VNC, which is a mobility maze used to assess functional vision. We believe that improvements in maze performance have the potential to correlate with improvements in visual sensitivity and or visual acuity. Finally, while we are assessing changes in macular structure in the Skyline trial, we do not believe, based on data from the Phase 1-2 study, that we will see any consistent changes in structure at the three-month interim analysis, as this time point is too early to capture these changes. If the three-month interim data achieve these expectations, we believe we will have significantly de-risked the VISTA clinical trial, which together with data from both the Phase I-II study and the Skyline Phase II expansion study is intended to support a BLA filing. I'd now like to briefly review the key Skyline efficacy endpoints. To start, We can look at vision and function in two ways, visual function and functional vision. Visual function describes how well the eyes and basic visual system can detect a target stimulus. In other words, how information is transmitted through the eye to the brain. Micro-parametry and best corrective visual acuity are tests used to assess visual function. We are utilizing macular integrity assessment system, or MIA, microperimetry, to measure light sensitivity of the retina in the Skyline and VISTA trials, as we believe it can appropriately measure functional changes of visual sensitivity to treatment in XLRP patients. Functional vision refers to how well a patient performs while interacting with the visual environment. That is, how the brain processes information to perform tasks of daily living. The mobility maze, which is a new endpoint for the AGTC 501 clinical program, assesses functional vision. These are the key ways we plan on evaluating outcomes for Skyline to potentially show a positive response to treatment in a clinically meaningful way and with endpoint second support registration. We also believe that it is important to show structure-function relationships in support of a treatment effect. Ellipsoid zone, or EZ width, is used to assess changes in macular structure. As we have previously discussed, EZ degeneration and loss over time is a hallmark of XLRP, and we've shared data from the Phase I-II trial demonstrating a significant association between improvements in visual sensitivity measured by Maya and improvements in retinal health measured by improvement in EZ in groups four to six. However, since EZ changes occur more slowly than changes in visual sensitivity or visual acuity, we do not expect to see evidence of structural improvements in the three-month skyline interim analysis. The mobility maze is a new endpoint for the AGTC501 clinical program. A mobility maze was validated as an endpoint for the approval of Luxturna, the first gene therapy approved for inherited retinal disease. Therefore, there is regulatory precedent for this measurement as a clinically meaningful and accepted endpoint for registration. We are using the AURA Visual Navigation Challenge, or VNC. This slide shows an example of the type of outputs and data that will be evaluated using the maze and how we currently plan to report the outcomes for the Skyline three-month interim analysis. The AURA VNC has multiple possible configurations that create varying levels of challenge conditions with respect to maze path and obstacles. In addition, patients are tested over a range of lighting conditions from dim to bright interior light. Patient performance is assessed by both the time taken to traverse the maze as well as accuracy in navigating the course and avoiding obstacles. To pass at a given light level, the patient must navigate the maze within both a defined time and accuracy rate. The ability to pass the maze challenge at lower light levels is consistent with a response to treatment. The FDA has previously provided feedback to us that it considers a clinically meaningful change to be a patient's ability to pass the test in two illumination levels lower than baseline A key benefit to the mobility maze is that it has the potential to capture improvements in multiple functional endpoints as the ability to successfully navigate the maze, a function of both visual sensitivity and visual acuity. In addition to assessing the ORAVNC results for efficacy, we plan to also evaluate potential correlations between changes in mobility maze scores and improvements in microperimetry and best corrected visual acuity assessments in the Skyline three-month interim analysis. Now let's turn our attention to the XLRP VISTA clinical trial. This slide summarizes the VISTA study design. As previously discussed, VISTA is a Phase 2-3 trial with two treatment arms that correspond to the doses used in groups two and five in the phase one-two trial, as well as an untreated control group. The primary endpoint is improvement in visual sensitivity based on the percent of responder patients. A responder is a patient that has at least five predefined loci improved by at least seven decibels. However, as we have stated previously, we believe that given this is an ORCN indication, that an approval will likely be based on the totality of the data, including the mean improvement in visual sensitivity over the entire treated area, supportive improvements in visual acuity and structure, a favorable risk benefit profile, and improvement in patient reported outcomes, or PROs. At the time of the first VISTA interim analysis, we expect to have 12-month skyline data and 24-month data from the Phase I-II clinical trial, which will enable us to have a robust data package to review. We believe that AGTC501 has best-in-class potential for the treatment of XORP and look forward to sharing additional data from all three clinical trials with you in the months ahead. In summary, we have generated a significant body of clinical and preclinical data to date. While these data are important to the development of our achromatopsia and XLRP product candidates, they also provide further evidence that our preclinical approach to product development and our technology platform are robust and supportive of our broader portfolio of gene therapy candidates. I'll now turn the call over to John for a brief update on our manufacturing facility and review of second quarter 2022 financial results.