Design Therapeutics, Inc.

Good afternoon, and welcome to Design's conference call. At this time, all participants are in a listen-only mode. There will be a question and answer session after the prepared remarks, and please be advised that this call is being recorded at the company's request. I would now like to turn the call over to Dr. Shawn Jeffries, Chief Operating Officer of Design Therapeutics. Sir, you may begin.

Thank you. Welcome, and thank you to everyone for joining us today. We are pleased to share with you these initial results from our phase one multiple ascending dose study of DT216 for the treatment of Friedreich ataxia. Earlier today, we issued a press release outlining initial data from this study. The slides that we'll be using during today's call will be available along with a recording of this call in the investor section of our website at designtx.com. With me on the call today are President and CEO Joao Sifert and Chief Medical Officer Dr. Jae Kim. During this call, we will be using forward-looking statements related to our current expectations and plans, including our program development plans, which are subject to risks and uncertainties. Actual results may differ materially due to various important factors, including those described in the risk factor section of our most recently filed 10-Q. These statements represent our views as of this call and should not be relied upon as representing our views as of any date in the future, and we undertake no obligation to publicly update any forward-looking statements. On slide three, serious inherited degenerative diseases affect millions of people across the globe, and research has identified nucleotide repeats in the genome as the underlying cause of a number of these diseases. However, there are currently no therapeutic options that address their root cause. At Design, we're approaching the problem of genetic disease differently. Our founding scientific breakthrough showed the potential of a small molecule genomic medicine that works with a patient's natural genome, allowing the patient's own cells to make the gene product that it needs. We call these gene-tacked small molecules. These are designed to harness an individual's natural genome to either dial up or dial down the expression of an individual mutant gene to address the root cause of inherited nucleotide repeat diseases while retaining the favorable pharmaceutical properties of a small molecule. We're evaluating our lead gene tax small molecule, DT216, for the treatment of one such degenerative disease, Friedreich ataxia, or FA. By way of background on slide four, FA is a monogenic disease caused by a homozygous GAA repeat expansion in the first intron of the frataxin gene. These repeats act like a roadblock and prevent the normal transcription of frataxin, a gene important for mitochondrial function. Lower frataxin levels cause earlier onset and faster progression of FA symptoms. The main clinical manifestations of FA are shown on the right side of the slide and involve multiple organs, including central and peripheral nervous systems, heart, pancreas, and importantly, skeletal muscle. Before we get into the data, I'd like to review the therapeutic hypothesis of DT216 as a treatment for people living with FA. As outlined on slide 5, DT216 is a novel gene-tax small molecule designed using our platform technology. The illustration on the left-hand side depicts the impairment of frataxin transcription due to the GAA repeat expansion mutation that causes FA. These long stretches of GAA repeats reduce frataxin transcription, leading to all the disease manifestations of FA. On the right-hand side, we designed DT216 as a heterobifunctional small gene-tacked molecule where one end of the molecule binds into the minor groove of intact double-stranded DNA in a sequence-specific fashion, targeting the GAA repeats. The other end of the molecule binds and recruits the transcriptional elongation complex by interacting with BRD4, enabling transcription through the intronic GAA repeat expansion and restoring the expression of a patient's own natural frataxin. The intronic GAA repeats are subsequently removed through the normal splicing process, and the endogenous for taxin mRNA is translated into normal functional protein. Therefore, transcription of mature endogenous for taxin mRNA serves as a key biomarker of pharmacology in our clinical studies. With that, I'd like to turn the call over to Jae Kim, our chief medical officer. Jae is a cardiologist and has decades of successful development of therapeutics, including multiple genomic medicines. He joined design in early 2022 and leads our clinical programs. Jay?

Thank you, Sean. Before we dive into the DC216 multiple ACE and EGO study, let's first discuss an observational study that design conducted, shown on slide 6. We developed procedures and methods to measure endogenous potassium mRNA and protein in skeletal muscle to enable evaluation and clinical activity directly in tissues relevant for disease symptoms. we biopsied three populations, normal healthy volunteer controls, heterozygous FA carriers, and FA patients. It is important to emphasize that carriers who have only one mutant allele with a GAA repeat expansion are phenotypically normal and clinically healthy. The plot on the left illustrates interquartile ranges in tenths and ninetieth percentiles. The biopsy data show that endogenous protaxin mRNA across the three populations are significantly different from each other. The interquartile range of SA patients, shown in blue, do not overlap with that of clinically normal carriers, shown in purple, demonstrating that protaxin mRNA levels from these two populations are largely distinct. We believe that the data supports use of our muscle protaxin mRNA assay as a sensitive indicator of clinical activity in SA. with the ability to discriminate clinically meaningful changes in endogenous frataxin mRNA expression. We would like to also propose that any significant increase in endogenous frataxin may be clinically meaningful, especially increases in frataxin mRNA beyond the upper portal of FA patients or into the carrier range. I would like to now discuss frataxin protein on slide seven. On the left plot, we show protaxin protein measurements in carrier and SA patients using our measurements from muscle biopsy samples. In contrast with mRNA, protaxin protein measurements were much more variable and had substantial overlap between the SA patient and carrier population. On the right plot, We show the intra-individual variability from the 11 FA patients who underwent two biopsies approximately three days apart, with percent change in protaxin protein shown between the two visits. The red lines show more than half of FA patients had 25% or more visit-to-visit variation, with intra-individual coefficient of variation of 69%, which is beyond the range typically acceptable for a reasonable assay. This variability substantially limited the utility of these frataxin protein measurements in skeletal muscle. In summary, this observational data provides context for frataxin measurements using the procedures and methods developed in our DC216 Multiple Ascending Dose Study. On slide eight, I will now review the design and rationale of our DT216 phase one program in SA patients. The completed single ascending dose study evaluated IV doses ranging from 25 to 600 milligrams of DT216. As we previously shared, there were injection sites for most thrombocobitis events in the SAD study, and these were only observed at the highest dose levels, at 400 and 600 milligrams. As a result, our Phase I MADS study, shown on the right, explored initial multiple doses of 100, 200, and 300 milligrams, shown in blue, green, and orange respectively. These doses were selected based upon anticipated tissue exposures projected to be in the therapeutic range and injection site tolerability guided by our single ascending dose experience. Participants were randomized, double-blinded, to either DT216 or matching placebo administered as three weekly IV injections. The MAD study was designed to assess safety and tolerability and pharmacokinetics of multiple doses of intravenously administered DT216. Exploratory clinical activity was measured by levels of endogenous protaxin mRNA in muscle biopsies, taken at pre-dose baseline, and then two days and seven days after the third weekly dose. Muscle biopsies were performed in the 200 and 300 milligram cohorts only. All initial data we will walk through today is based upon a data cutoff of August 7th. The study is fully enrolled but currently ongoing. with blinded PK and PD data available in full 100 and 200 milligram dose cohorts and 11 of 14 participants in the 300 milligram dose cohort. Safety data remain blinded. Baseline characteristics of the enrolled population are detailed on slide nine. A total of 29 adults with clinically diagnosed FA with genetically confirmed homozygous GDAD repeat expansion mutations were enrolled in this study. As you can see, the study enrolled a representative sample of symptomatic SA patients distributed across the dose code works. MAD study safety data aligned with the treatment assignment are summarized on slide 10. Multiple doses of DT216 were generally well-tolerated, but injection site reactions were observed. There were no serious AEs and no discontinuations due to treatment-related adverse events. All AEs were mild or moderate and none were severe. There were five events of injection site thrombocobitis. Four of these events were mild and one was considered moderate. These events in the MAG study were observed across the three-dose cohorts, and we will provide further perspective on these injection site reactions in the summary. There were otherwise no new clinically significant safety observations. As we review the biopsy data in the next few slides, note that two participants did not return for post-dose biopsies due to acute COVID. Slide 11 summarizes the plasma pharmacokinetics of three weekly doses of BP216. As shown in the left panel, plasma BP216 levels were approximately dose proportional. The first and third dose PK profiles were also similar, showing a lack of significant drug accumulation at the three doses. On the right, average DT216 concentrations measured in skeletal muscle were approximately 8 to 10 nanomolar two days after the third weekly dose on both the 200 and 300 milligram cohorts. Muscle PK declined to approximately 1 nanomolar at seven days after the third weekly dose. These DT216 concentrations in muscle were lower than projected based on non-clinical studies in animals, but were sufficient to drive substantial pharmacology, as we will show in the next slide. Slide 12 summarizes the clinical activity of DT216 in skeletal muscle by measurement of endogenous frataxin mRNA. The left panel shows mean percent change from baseline in protaxin mRNA in 200 and 300 milligram cohorts. Protaxin mRNA expression in muscles was significantly increased from baseline at two days after the third weekly dose of 300 milligrams shown in the left orange bar compared to placebo shown in the left gray bar with a p-value less than 0.05. Protaxin mRNA increased 30% with DT216 treatment, which corresponded to levels in the 75th percentile, or the top upper quartile of reference FA patients from our observational study. We also observed durable increases in protaxin expression with a positive trend in increased protaxin mRNA seven days post-dose, as shown in the right-hand orange bar. The right panel shows a waterfall plot of individual FA patients' protaxin mRNA and muscle. Increases in individual protaxin mRNA show adaptive response across individuals that favors the DT215 treatment, using ranges from the observational study referenced Protaxin mRNA by percentiles is overlaid in the lower blue shaded area for FA patients and the upper purple shaded area for clinically healthy carriers. Treatment with DT216 restored protaxin mRNA in muscle to what we believe is a clinically normal range for one patient in the 300 milligram dose group. with approximately half of DT216 treated patients' response above or approximately at the upper quartile of reference SA patients. For context, higher potassium expression among SA patients previously has been shown to be associated with myelin disease. Additionally, exploratory statistical analyses demonstrated a significant DT216 dose-response trend and tissue exposure-response relationship for muscle protaxin mRNA, both at p-values less than 0.05, adding to the multiple lines of evidence that protaxin mRNA increase in muscle with DT216 treatment is a robust finding. On slide 13, we summarized additional exploratory evaluations. On the left, we assessed muscle protaxin protein in the MAG study, and these measurements were highly variable, consistent with findings from the observational study. We did not detect an observable protaxin protein signal above the measurement noise. These results were therefore inconclusive due to assay variability. On the right, we evaluated protaxin mRNA in PBMCs. In the MADS study, we observed a transient increase of protaxin mRNA in PBMCs 24 hours after the dose, which was consistent with and confirms the results from the single-dose study. As of this data snapshot, the PBMC protein results are not yet available. Turning to slide 14, in summary, we are enthusiastic that this phase one multiple-ASCII study has demonstrated proof of concept. showing clinical activity of DP216 in skeletal muscle of SA patients of relevant disease-affected tissue. We observed significant endogenous protaxin mRNA increase two days after the third dose at P less than 0.05, with trends in durable increases to seven days. Increases in protaxin mRNA corresponded with levels in the observational study that might portend less severe disease. A significant dose-response trend and exposure-response correlation in skeletal muscle, both at P less than 0.05, adds to the internal consistency of the evidence in support of DT216's ability to reverse the transcriptional block of endogenous protaxin mRNA expression that is the root cause of FA. DT216 levels in multiple biopsies were lower than projected from animal studies, but substantial and dose-proportional pharmacology was observed in human disease exposures. Multiple doses of DT216 were generally well-tolerated with a favorable systemic profile. Local injections by thrombocobitis occurred across the three-dose cohort, and Joao will provide additional perspective on how we plan to advance DT216 for the treatment of that patient. And with that, I'd like to turn the call over to Joao Siefert, our CEO.