Editas Medicine, Inc.

Good morning and welcome to the Editas Medicine second quarter 2024 conference call. All participants are now in a listen-only mode. There will be a question and answer session at the end of this call. This call is being recorded at the company's request. I would like to turn the call over to Christy Barnett, Corporate Communications and Investor Relations at Editas Medicine.

Thank you, Brittany. good morning everyone and welcome to our second quarter 2024 conference call earlier this morning we issued a press release providing our financial results and recent corporate updates a replay of today's call will be available in the investors 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 the 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, as updated by our subsequent filings. 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 CEO, Gilmour O'Neill.

Thanks, Christy, and good morning, everyone. Thank you for joining us today on Editas' second quarter 2024 earnings call. With me today are four other members of the Editas executive team, our Chief Medical Officer, Bae Sung Mai, our Chief Financial Officer, Eric Lucera, our Chief Scientific Officer, Linda Berkley, and our Chief Commercial and Strategy Officer, Taryn Deardorff. Because it is summertime, we're going to keep today's prepared remarks brief and leave more time to take your questions. Let me start by saying that we are pleased with Editas' momentum and progress in the second quarter of 2024 as we pursue Editas' goal to deliver life-changing medicines to patients with previously untreatable or undertreated genetic diseases and to position Editas as a leader in in vivo programmable gene editing. Three pillars underpin our strategy. The first of those pillars is to drive Renicel, a gene-edited cell therapy for hemoglobinopathies, formerly known as Edit 301, toward BLA and commercialization. The second, to build a differentiated in vivo editing pipeline. And the third, to increase business development activities with a particular focus on monetizing our very strong IP. At the start of 2024, we announced the following 2024 objective. For Renicel, we would provide a clinical update from the Ruby trial for severe sickle cell disease and the Edithal trial for transfusion-dependent beta thalassemia in mid-2024 and by year-end 2024. We would complete adult cohort enrollment and initiate the adolescent cohort in Ruby and continue enrollment in Edithal. For our in vivo pipeline, we would establish in vivo preclinical proof of concept for an undisclosed indication. And for BD, we would leverage our robust IP portfolio and business development to drive value and complement core gene editing technology capabilities. So how are we executed against this strategy and these objectives in the second quarter? Let's start with Renicel. First, we shared Ruby and Edithal clinical data in June at EHA 2024, the European Hematology Association's annual congress. The Ruby data set included 18 sickle cell patients with 2.4 to 22.8 months of follow-up, and the Edithal data set included clinical data from seven beta thalassemia patients with 4.1 to 12.8 months of follow-up. These data from the Ruby trial support our continued belief that Renicel will be a best-in-class product for sickle cell disease. So why do we think this? All patients treated in the Ruby trial are free from vaso-occlusive events post-Renicel infusion. All patients have robust correction of anemia with a mean total hemoglobin level within the normal range for both genders at greater than 14 grams per deciliter. And all patients have high fetal hemoglobin with levels well above 40% from six months onwards. We also demonstrate fast engraftment with low variability with a mean neutrophil engraftment of 23 days, which may translate to shortened hospital stays for patients. For cell collection, we have a mean of two apheresis cycles with a range of one to four per patient. Finally, in addition to the clinical data shared at EHA on the manufacturing front for any cell, we have a robust manufacturing process with a low failure rate that continues to improve with experience. This low rate of manufacturing failure can decrease patient burden and reduce overall costs as we avoid cell recollection and redundant cost of goods sold, or COGS. And we're on track to share additional clinical data for both the Ruby and Edithal trials by the end of this year, 2024. Second, Ruby enrollment and dosing continues to be strong. Indeed, we have now completed enrollment of the adolescent cohort. As a reminder, we completed the adult cohort enrollment in the first quarter of this year. We are manufacturing drug product and scheduling adolescent and adult dosing concurrently. We also continue to progress Edithel and are pleased to announce completion of the adult cohort enrollment and continue to dose patients. Finally, based on our continued and collaborative conversations with the FDA, we still expect our future BLA package to be similar in number of patients and duration of follow-up to what we've seen in the gene editing medicine field. Before I turn to InVivo, I'd also like to state that we are very focused on the best use of capital as we develop Renicel and map to the future. As part of that focus, we frequently evaluate opportunities, including the potential for partnering Renicel to most efficiently drive Renicel towards commercialization ultimately delivered to patients in need. Now let's turn to our InVivo pipeline, where we continue to strengthen our InVivo discovery capabilities and drive lead discovery work on InVivo therapeutic targets in hematopoietic stem cells and other tissues. Importantly, we remain on track to establish in vivo preclinical proof of concept for an undisclosed indication by the end of the year. We want to take a moment, rather I want to take a moment to reiterate our in vivo strategy to develop a pipeline of gene editing medicines for patients with serious genetic disease. As a reminder, our internal development efforts are differentiated from established modalities and we are not pursuing the same gene editing approach as others. Our strategy is to use our in-del technology for functional upregulation of gene expression to address loss of function or deleterious mutations. Let me be clear. Our strategy is not the knockdown strategy that others in gene editing are pursuing. And it is worth highlighting that we have already demonstrated that our in-del technology can drive functional gene upregulation, thus creating differentiated experimental medicines, as in our ex vivo development of Renicel. With Renicel, We leverage our INDEL CRISPR technology to upregulate the expression of the gamma-globin gene, a functional homologue of the beta-globin gene, through direct editing of the HBG1-2 promoter sites. We are now applying this same approach to in vivo therapeutics by using our INDEL technology to functionally upregulate the wild-type alleles or functional homologue of target disease genes as we build our differentiated pipelines. Why does the difference between our functional upregulation strategy and the knockdown strategy used by other companies matter? Because with our in vivo strategy, we are not competing with existing modalities or technologies in development that are based on knockdown strategies. Second, our indication selection strategy targets rare and orphan diseases that we believe will allow us to be the first or best in class for a given indication. We expect to move into diseases with larger patient populations in the future. Our lead discovery work is in in vivo therapeutic targets in hematopoietic stem cells and other tissues. Third, Editas is well positioned to achieve success with our in vivo strategy and pipeline with our established capabilities in four main components of in vivo gene editing medicine. One, our guide RNA modifications that enable high potency gene editing in multiple cell types, including in the liver, and improve gene editing outcomes in vivo. Two, a superior editing enzyme in ASCAS12A, three, our messenger RNA, and four, delivery technology, where we are currently evaluating lipid nanoparticles for delivery of gene-editing cargo into multiple tissue types with multiple companies, as well as evaluating additional next-generation delivery technology. I look forward to sharing more details about our in vivo pipeline later this year and our in vivo proof of concept. Finally, I'd like to refer you to our press release issued earlier today for a summary of our financial results for the second quarter of 2024. I'll take this opportunity to briefly review a few items for the quarter. Our cash, cash equivalents and marketable securities as of June 30th were $318 million compared to $377 million as of March 31st, 2024. As you will note, our burn rate was slightly higher this quarter than the past. This higher rate is due to increased external research and development expenses primarily related to clinical and manufacturing costs related to the accelerated progression of our Renicel program. We expect our existing cash, cash equivalents, and marketable securities together with the near-term annual license fees and the contingent upfront payment payment under our license agreement vertex to fund our operating expenses and capital expenditures into 2026. Before we turn to Q&A, as always, it must be said that we could not achieve our objectives without the support of our patients, caregivers, investigators, employees, corporate partners, and you. We are energized by and proud of our progress and execution this quarter. With our sharp and strategic focus, our world-class scientists and employees, our keen drive and execution, and strong balance sheet, we continue to progress our strategy to deliver differentiated editing medicines to patients with serious genetic diseases and evolve from a development-stage technology platform company into a commercial-stage gene editing company. Thank you very much for your interest in Editas. We are happy to answer questions now. Thank you.

At this time, if you would like to ask a question, please press the star and 1 on your telephone keypad. You may remove yourself from the queue at any time by pressing star two. Once again, that is star and one if you would like to ask a question. And we will take our first question from Jack Allen with Barron. Your line is open.

Great. Thank you so much for taking the questions and congratulations on all the progress made throughout the quarter. I apologize for any background noise here. I'm traveling today. But I wanted to ask about the preclinical proof of concept from the in vivo program that's expected later this year. I was hoping you could just elaborate a little bit more as it relates to what kind of data you look to put out. Will it be in a large animal model or a small animal model? And how should we think about the types of experiments you're looking to do to elucidate the off-target editing profile for this program?

So Jack, I think you broke up near the end, but let me just restate the question the way I heard it. And then hopefully, if you need to correct it, let us know. So essentially, you just want to have an understanding of the data that we will have for our in vivo POC, the size or the species that we will use in vivo. And I think you wanted to talk about, I think I might have heard you talk about indications. I'm not sure.

Yeah.

So I'm going to ask Linda maybe to address your question.

Yeah, thank you, Jack. You did break up a little bit, so thanks, Gilmour, for elaborating there. So, yes, we are on track to establish preclinical POC in vivo for this undisclosed indication by end of year. We've not yet disclosed the CGs in which we're working, but our evaluation process is going to entail evaluating the biodistribution to the site of interest, the efficiency of editing, the level of target modulation measured, for example, by a biomarker readout, and, of course, the tolerability and we'll be sharing more information, the forum, and the timing for our announcement of that data at a future time.

Great. Thank you so much for taking the question.

Thanks, Jack. Thank you. We'll take our next question from Samantha Skakow with CIDI. Your line is open.

Hi. Great. Good morning, and thanks for taking the question. Just building on the prior question, You're using an LNP because that's your strategy, non-viral. Would you expect to have an LNP targeted for the tissue of interest for the proof of concept readout indication optimized this year, or would you need to further optimize after the proof of concept is in hand? Thank you.

So, Sam, thank you very much for your question. I'll have Linda take that.

Yeah, thank you, Sam. Thank you for the question. We are evaluating LMPs with different partners because we are interested in targeting different tissue cell types for different disease areas of interest. We haven't yet disclosed which tissues we're doing the non-clinical POC targeting in, and we'll be sharing that information at a future time when we disclose the data. So in terms of the targeting aspects that you refer to, we'll share the information in the future.

Thank you.

Next question from Eric Schmidt with Cancer Fitzgerald. Your line is open.

Oh, great. Love the summertime strategy. Very efficient. Maybe it'll continue into the fall and winter. We'll see. In terms of my questions, first, with the adolescent Reniso cohort now completed in terms of enrollment, can you start to estimate your timeline to a BLA?

Thank you, Eric. I'm going to have Baesong take that question for you.

Thank you for the question, Eric. We have announced that in June we have dosed more than 20 patients and we continue to dose in patients. So that is moving along very well. And then we continue to consider the, uh, catch GV approval as our benchmark. Um, so that in terms of a sample size, in terms of efficacy sample size, as well as observation duration of 15 to 18 months and the total sample size, initial submission with 20 patients and with additional 10 patients doing the review. So this is kind of the scope of that. And, uh, We have not shared the specifics of the timeline because we have to get a final alignment with the FDA, but we are very optimistic that we are collecting the data from, we are closing to the BLA data package we are looking for.

Thank you, very helpful. And maybe Baesong or Gilmore, can you talk about what we hope to learn at the late 2024 update on the program? As Gilmore mentioned, at this point, we know a fair bit about Renesol's profile.

So based on... Yeah, thanks, Eric. Yeah. So we expect to have data from longer duration of follow-up for those patients we present at EHA, which means we're going to have more than 10 patients have one-year exposure and additional patients have a different exposure. And then we also, at e-hub, we present data for 18 patients. We have same thing, dosing multiple more patients. So we're going to have more patient data also. So with that, we were very excited for the data end of the year because we're going to have longer duration and we're going to have a data package similar to the CasGV BLA. So we're looking forward to share data with you all. Thank you very much.

Thank you. We'll take our next question from Terrence Flynn with Morgan Stanley. Your line is open.

Good morning. This is Mia on for Terrence. Thanks for taking our question. So recognizing it's still early in the launches of Kaskavy and Lithgenia, but are there any learnings thus far that you hope to utilize for a future Renicell launch? Thanks.

Thanks very much, Mia. Indeed, there are. And let me pass you over to Karen Dierdorf, our Chief Commercial and Strategy Officer.

Great. Thanks, Nia, for the question. First, we really want to say that we're encouraged by the Vertex update of the 20 patients in cell collection, which is a nice bump up from the five in Q1. We really see that as an acceleration that we have anticipated because we understand that there are multiple steps in the process to get a patient dosed. And we anticipate that they probably have a number of additional patients in earlier enrollment phase before cell collection. including getting payer reimbursement. We anticipate significantly more uptake over the coming quarters as we look at both companies. We know from our own enrollment and the excitement in our trial that there is a lot of patient and physician interest, and so that will continue as there's more exposure to our three therapies. In the U.S., we also know that payers are doing case-by-case approvals with few rejections. We know that patients are able to get access and that policies will be in place over time. As a reminder, we really believe that our fast follower timing is an advantage, which gets to your question about the learnings. And that really allows us to be able to optimize our own launch plan. And another key component is that we understand the time it takes for centers to get up to speed, for payers to put policies in place. All of that, we anticipate, will come together around the time that Renicel might launch. We are already seeing a decrease in the amount of time for onboarding between Bluebird and Vertex and anticipate that that onboarding cycle from our own conversations and research will be significantly shorter at the time of our launch. So we are really encouraged, and we know how much it takes behind the scenes, and we're just really glad to see patients moving closer to dosing. Thank you for the question.

Great, thank you. Thank you. We will take our next question from Gina Wang with Barclays. Your line is open.

Thank you. I will ask two questions. First one is, what is your average process time from patient enrollment to dose? Any differences between adults and adolescent patients? And the second question regarding your Intel technology, you say you will do upregulating. Just wanted to make sure that was the knocking down the repressor so that the targeting will be upregulated.

Thank you very much, Gina. What I'm going to do is have Baesong address your question about the process time or the vein-to-vein time or enrollment to infusion time for adolescents versus adults. And then I'll pass over to Linda, and I'll restate your question just so we all remember. Baesong.

Yeah, thank you, Gina, for your question. From the enrollment to dosing, it varies quite significantly among patients, and some are going to be very short, like three or four months, and others can be 10 months or even longer because some patients have VOE in the middle and during the process before dosing of Renacel. Between adult and adolescent, and we see now is that We have very robust enrollment, and that screening process was going faster than we had for adults. And the aphrodisiac process also going very smoothly. And that's probably also related to that the adolescent patient in a better health condition compared to older adult patients.

Thanks very much, Baesong. And then, Gina, you asked a question just to clarify how we're using Indel technology to functionally upregulate genes, and specifically the interdiction of the regulator.

Yeah, thank you, Gina, for the question. So our functional upregulation strategy is different. It is not a knockdown strategy. So we, as per your question, we would not be knocking down the repressor if we use the Renicel example as a paradigm. In that case, we are creating an indel to disrupt the binding site for the repressor, and that way we are upregulating gamma-globin expression. So using that as an example, we could do a similar type of thing for another target of interest. There are other ways. that one can create indels to upregulate gene expression. This is the approach that we are taking that is differentiated from a knockdown approach.

Thank you for the question.

Thank you. Thank you. We'll take our next question from Mary Kate Davis with Bank of America. Your line is open.

Good morning. Thank you so much for taking my question. I guess looking at your portfolio, how are you looking at the IP licensing opportunities in the future? Thank you.

Thanks very much, Kate. I'm going to ask our CFO, Eric Lucera, to address that.

Yeah, thanks for the question. We believe we have a very strong foundational position with respect to the IP license that we have from Harvard, MIT, and abroad. We are very open to having conversations with a range of companies in terms of getting a structure in place that is sort of bespoke and works for both us and them. We believe there's a high double-digit number of programs out in development, and a good number of those, about half, are with eight to ten different companies. So we look forward to having conversations with folks. And as you can see, we've had some pretty good success in the last few years, as evidenced by some of the licenses that we've already put in place. So very excited to have that as a potential source of non-dilutive capital for our company.

Thank you.

Thank you. We'll take our next question from Bryant Chant with J.P. Morgan. Your line is open.

Hey, guys. Thanks for taking our questions this morning, and happy summer. It sounds like you may have had additional discussion of the agency this past quarter. I'm just curious, other than the clinical data, what other additional items have you discussed? So it's based on package at the time of the BLA. I would assume that you can potentially file sometime next year. So outside of the clinical package that we're waiting for mature data, what other additional data or gating factor do you need to line up between now and then? In other words, any color on your readiness towards the filing? Thanks. Thanks very much, Brian.

I think there's sort of a complex question in that you're asking about the multiple data sets that are required to actually go filing. First of all, let me be very clear that we have not actually shared an estimate or given guidance to when we would file the BLA. I think that's very important just to state. The second is that we are very happy from the clinical data point of view and the generation how we're actually progressing towards really meeting or matching up with the benchmark set by the CASJV approval with, of course, the additional data that we are generating from a differentiation point of view. The additional datasets obviously include the preclinical, and we know that a key focus of the agency when you consider adcom was looking at off-target editing. We actually were very, how should I say, gratified by the adcom last December to see that the dataset that we've already generated is very robust and probably exceeds what was discussed at that adcom. So we feel very good with that. We're actually also very pleased with the progress of our manufacturing data. And as I said in my earlier prepared remarks, our ongoing discussions with the FDA really gives a lot of confidence about the progress of multiple data sets, beyond just the clinical, to bring us towards BLA.

Okay. And maybe just one more follow-up. On the in vivo side, Is that going to be a first-in-class or best-in-class approach? I'm just curious how do you think about balancing the risk and reward for your next assets? And thank you. Thank you very much, Brian. I'm going to have Linda address that.

Yeah, thanks, Brian, for the approach, the question. I think the differentiated approach for going after functional upregulation is really important. I think from... in an indication standpoint, because of the fact that we can go after targets that others may not be able to go after using a knockdown strategy, and that is established modalities or other technologies in development can't go after that target, that really gives us the ability to be first in class. We can also envision editing strategies that we yield a better outcome than other approaches that are going after that particular indication, giving us best-in-class. So we can either have first-in-class or best-in-class opportunities here.

Great. Thank you.

Thank you. We'll take our next question from June Lee with True Securities.

Your line is open.

Hi. Good morning. This is Mehdi for June. Congrats on the progress, and thanks for taking our question. So maybe a two-part question. Could you please provide any additional color on your in vivo editing approach as you previously talked about LSRs and they usually require a landing site insertion first. So any color there would be appreciated. And then to follow on Gino's question, how many disease you see being amenable to INDEL-mediated functional upregulation. Thank you.

Thanks very much, Mehdi, for your questions. Let me start. I'll have Linda address both questions, and I'll restate the second question. Obviously, your first question was, you know, as we talk about our INDEL functional upregulation, how is that distinguished from the use of LSRs? Linda?

Yes, thank you for the question. The LSR technology that we disclosed at ASGZT, we're very excited about that. That is a technology that may enable us in the future to have large gene insertions. And so this would be gene replacement approach. This is something that we're working towards. What we're doing in the shorter term now is functional upregulation of gene expression. And this is increasing the expression of a gene in order to compensate for a loss of function or a deleterious mutation in a patient with a serious genetic disease. So if that answers your first question, I think then you asked a question about how many diseases are amenable to indel. And there are many, obviously there are many genetic diseases caused by loss of function or deleterious mutations, and there are many ways in which they're regulated by various regulatory elements, and so there should be many, many opportunities here for functional upregulation of those targets.

If I may add, thank you very much, Linda. I think one of the key things is that, as we know from the human genome, only a small quantity of the genome actually encodes proteins. There's a large amount, the vast majority of the genome actually is non-coding, and much of that comprises regulatory elements that actually control the expression of genes. And as Linda very eloquently put it, this is what we're actually trying to target. And just to be absolutely clear, we are talking about INDEL using our CRISPR technology in general, and very specifically in the very near term, leveraging our AS-Cas12A, which, as we highlight, is, we believe, one of the key differentiated tools in our toolbox, as we believe it is a superior editing CRISPR enzyme because of its high efficacy and its high fidelity. Thank you.

Thank you.

We'll take our next question from Dagon Ha. With default, your line is open.

Hey, good morning, guys. Thanks for taking our questions and congrats on the progress as well. Maybe first question for Linda, going back to the in vivo, recognizing you're going to be disclosing, so I don't want to probe too much, but at least help us appreciate it a little bit more. Is this Are you guys kind of driven by the limitations of LNP-mediated delivery in terms of what cell types and what organ types you can go into? Or is this more dependent on how big of a size market you have potential of, first indication as well as the potential subsequent indications that can come after this first one? And then second question, maybe high-level Gilmore or Bazong, You know, year-end, we're also expecting Beam's first data set coming out of Beam 101. You talk about Renicel being best in class, so I was just wondering what kind of data set would keep you more confident about that notion going into that ASH presentation? Thanks so much.

Thanks very much, Dagan. So, Linda.

Thank you, Dagan. So, to your first question, Yes, in terms of the LMP, the delivery obviously is critical for getting POC. So we've shared our interest in targeting hematopoietic stem cells. And this is obviously to translate to the remarkable success we're having with our Renicel asset. So we are obviously trying to target hematopoietic stem cells in vivo. We've also though we haven't disclosed all of the disease areas that we're interested in. And other than HSCs, we have mentioned that we are interested in targeting the liver. And so there are validated LMPs for targeting liver. So there is a pragmatic approach here based on delivery.

If I may add, Linda, thank you. You know, it's not just the delivery tool that we are leading with in L&P that actually determines how we select our targets. Obviously, delivery is an important element. Obviously, amenability to functional upregulation is important. We're actually also selecting diseases based on their clinical translatability in that we want to ensure that we can actually get obvious clinical signals in our human proof of concept and obviously then obviously we also further filter that by ensuring that we are truly differentiated to ensure maximize the probability not just a technical clinical regulatory but actually also commercial success and then with regard to your second question you know what we expect to see from the beam data set You know, frankly, obviously, we're looking forward to seeing it. It is always good to see continued pursuit of therapeutics within a clinical space for which there is an enormous, enormous unmet need in the context of sickle cell disease and transfusion-dependent thalassemia. It's very hard. I can't speculate on what BEAM will show. I look forward to hearing it, and we all look forward to hearing it. But I will tell you that we are very happy with the differentiated profile that we are developing for ReneCell. And it's important to point out that we are very happy with the biological profile, the hematological profile, the clinical profile, all of which are very strong. And in addition, as we've alluded to, we are confident that in the evolution, in the current state of and the continued evolution of our manufacturing from the success rates is very gratifying. So overall, we actually feel very good. And of course, it's important to also remember, as I said earlier, that an additional piece of the data includes our non-clinical, including our off-target editing, which is very robust and as I said, in the packages we've generated. And of course, some of that robustness stems from us using AS CAS 12A as opposed to CAS 9 with its differentiated high efficacy, high fidelity characteristics.

Great. Thanks so much. Thank you.

Thank you. We'll take our next question from Luca Easti with RBC Capital. Your line is open.

Oh, great. Thanks so much for taking my question and congrats on the progress. I have two quick ones. Maybe on sickle cell disease, we have seen the U.S. Health and Human Service issuing a negative opinion here on covering fertility preservation for federally insured patients who receive gene therapy for sickle cell disease. So just wondering what is your take on that? And then maybe second, Gilmore, bigger picture, you seem very excited about the in vivo upregulation strategy here. Is there a version of the world where you just partner or any sell both US and ex-US instead of building a commercial infrastructure and just focused on your in vivo strategy? Any thoughts there? Much appreciated. Thanks so much.

Thanks very much, Luca. So I'm going to pass your first question to Karen around the HHS decision.

Yeah. Luca, thank you for calling that out. Look, we are deeply disappointed by this decision, and we join the voices of Vertex, Bluebird, really the whole field in this decision, which seems very out of touch with the severity of sickle cell and the unmet need, and it just continues to drive a discrepancy between the commercial patient's ability to access therapies and have companies cover the fertility preservation, as you know, and Medicaid patients. So we are very disheartened. We also know that there are a lot of voices who are within Congress and within the industry and other organizations, including the patient advocacy groups, who have a very strong voice. And our hope is that all of us together will be able to really raise this issue and have it reversed in the coming time. We believe that things will sort themselves out. We are disappointed for the patients who are seeking treatment today. Our belief in our own timing as fast follower is a lot of these unfortunate decisions will be figured out at the time that we're ready to come to market. But thank you for calling it out. It is really an out-of-touch decision. And we will hope for the best and do our part.

Thanks very much, Karen. And then Luca, to your second question around, I think it sort of stems from our prepared remarks, how while we're extraordinarily excited by our Renicella, our in vivo progress, we're also very conscious of how we deploy our capital. And I'm going to ask Eric to address that.

Yeah, Luca, just following up, as we've said for many years, our intention was to look for partners outside of the U.S. And I can tell you as someone who invested in biotech for 15 years and has been doing business development and CFO for about 15 years, you never know where those discussions may go. But what we can assure you is that we're going to do the right thing in terms of what's in the best interest for getting our products to as many patients as possible and driving shareholder returns to the best level possible.

Thanks so much.

Thank you. We'll take our next question from Phil Nadu with T.D. Cowan. Your line is open.

Good morning. Thanks for taking our questions. Two from us. First on Renicela and the prospects for clinical differentiation, we're curious what your most recent thoughts are on the time to see that clinical differentiation on things like end organ damage. Is it possible that we could start to see strong signals of that in the ASH presentation? And then second, on the in vivo development program, Gamar, I think you said the initial indication will be orphan and then there will be larger indications perhaps later. Can you give us some sense of what size patient population you think is necessary for a good return on an investment? What's too small? What's the sweet spot for an orphan population? Thanks.

Thanks very much, Phil. So I'll have Pei-Sang talk about the differentiation and how we see that evolving. And then I will take your question on how we think about the size of the population.

Yeah, thanks for the question. And as we stated before, in clinical trial, we're looking at three categories of evidence about differentiation and including pathological parameters and organ function and the patient-reported outcome. And then in terms of timing of those endpoints and when we see the change, and so for the end organ function, you specifically mentioned that it is a relatively new field, but fortunately, we're we already see more publications in the allogenic transplant for treating sickle cell disease. They have presented encouraging data that after allogenic transplant, you can see the end organ function improvement, including cardiovascular, central nervous system, and so on and so forth. In our clinical trial, we monitor multiple organ and organ functions, including pulmonary, cardiovascular, liver, renal, and that. And so, based on the publication, some are reporting that at one year you see some improvement already, so we are very encouraged by that. But other parameters, for example, the hematological parameter will give us more opportunity to directly measure that change. For example, we're talking about the correction in anemia. And then the third category is patient report outcome. And we are also very encouraged by the reports. and being published in this field, then we will be able to see the quality of life change after the treatment. So we're looking forward to see the more data and we are very excited to see that the data from all our patients are very consistent. Now we report 18 patient data. We see that the same direction and the same trajectory in terms of the patient data-wise. We're very pleased. We're looking forward to sharing more data at the end of the year.

Thanks very much, Bae Song. And then, Phil, with regard to your second question, which is around where do we think that a population size for an orphan indication, where we're sort of focusing our initial foray in in vivo, lines up for optimal ROI? A couple of things. First of all, the reason that we're actually focusing on rare orphan, the main reason obviously is that as we bring in new technology to patients, we want to actually maximize the probability of technical and regulatory success while we at the field and agencies characterize and learn the long-term risk benefit associated with this technology. More importantly than when I turn or not more important, but then I turn to market size, the market size to talk about is really based on patients, the patient numbers with indication versus the price. And obviously price will be determined by a number of factors, including the amount saved by what we're talking about are potentially or largely curative therapies with high potency. I mean, this is what we want. One of the things we're really excited about our technology is we're talking about using this technology, not just because it's new and cool, but because it has the potential to deliver high potency, large effect sizes in patients. And so when you actually consider those elements, you know, our current estimates that a range of about four to, you know, 500 million is about the market size that would be meaningful and enable us to, you know, drive growth. And as we grow and evolve into treating larger populations, as we build that safety characterization in a number of smaller orphan-sized populations. That's very helpful. Yeah, that's very helpful. Thank you.

Thank you. We'll take our next question from Jay Olson with Oppenheimer. Your line is open.

Hey, this is Chong on the line for Jay. Thanks for taking the question. This may be on Renishaw. By the time you filed a BLA, I'm just curious... Do you think the follow-up in the adolescent cohort is long enough so the label may cover both adult and adolescent patients? Thank you.

Thanks very much, Shea. I want to just restate your question because it was a little muffled on the line. I think you were asking, will the adolescent cohort be followed for long enough to be part of the label Yes, that's correct. Okay. Yeah, that's correct.

Thanks, Chan. We are very pleased with the progress of the adolescent cohort, and we started enrollment this year, and we already completed enrollment in a matter of months. So we're very pleased with that. We certainly wanted to seek for broader indication of all age cohorts, and we already have alignment with FDA about the clinical trial for all the age cohorts. So that's what we're very much looking forward to that.

Okay. Thank you so much.

Thank you. We'll take our next question from Yian Xu with Wells Fargo Securities. Your line is open.

Oh, great. Thanks for taking our questions. So for the in vivo program, are you trying to upregulate the disease-causing gene itself, or are you trying to upregulate a different gene to compensate for the loss of the disease-causing gene? In other words, are we talking about haploinsufficiency type of indication, or are we talking about recessive gene defect? Secondarily, I wanted to ask about any updated timing for the CAFC patent dispute process. Thank you.

Thanks very much, Yanan. So with the first question, I'm going to start by saying that you have actually described, you've actually nailed both elements of the upregulated strategy, but I'll let Linda just expand on that. And then I'll restate the second question and we'll address that.

Yeah, thanks very much for your question. So the two scenarios that you described, like both are possible approaches. One can imagine in loss of function, homozygous recessive state, upregulating a pathway gene that can compensate for the loss of the gene. they mutated genes. So that's the case with the Renicel example, where beta-globin in TDT, there's no expression of beta-globin, or in sickle cell disease, it's a deleterious mutation, and so it's not functioning properly, and we upregulate gamma-globin to compensate in both of those cases. One can also imagine a scenario of haploid insufficiency, where you have One allele has a pathogenic mutation, but there's a wild-type allele that can be upregulated to compensate for the loss of function of the mutated allele. So either scenario is a potential target for us.

Thank you very much, Linda. And I think, Yanan, you asked a second question about update on the CAFC timings. Obviously, the oral presentations occurred in the last quarter, in May, and we anticipate a decision probably before the end of the year. I was just wondering if I could translate haploid insufficiency into lay terms for those who might not have done molecular biology or genetics. By haploid insufficiency, everyone carries two copies. most copies, two copies of a gene. And the context of haploid insufficiency, one gene is not functioning, which results in a reduction in the total dose of protein that's available to the person resulting in disease, so-called insufficiency or haploid insufficiency. And the strategy that Linda is describing that we're pursuing to manage that is that you drive up expression of the normal copy to actually approach or get to the same dose of overall protein that would be required for normal health. I hope that was helpful.

Great. Thanks, Antonio, and thanks, Linda.

Thank you. We'll take our next question from Steve at Seedhouse with Raymond James. Your line is open.

Hi. Good morning, and thank you for the question. This is Nick on for Steve. Had a quick follow-up to Luca's first question, actually. Are you able to speak to the importance and demand for fertility support in your own clinical trials experience for STD? Also curious of your thoughts on the potential market impact if you're not able to provide this support once approved. Thank you.

So, I'm going to split that question into two parts. I'm going to, as a base scientist, talk about our experience in our clinical trials. And then I'll have Karen to talk about the impact, and very importantly, how we anticipate mitigating or ensuring that that impact is not going to be there.

Yeah, thank you for the question, Nick. In clinical trial setting, we do provide fertility support, which is critical for patients, especially this patient population, that it is important for them to have that support to be able to go through the chemotherapy and conditioning process. You know, I want to let Karen to emphasize the importance of that in the commercial setting.

Yeah, thanks for the question. So we do see this as a very important component of support to sickle cell patients in the context of the gene editing transplant. In terms of impact on the market, what I will say is that for the Medicaid population within the CMMI model that we've all discussed and we hope and anticipate will get started sometime in 2025. There actually is a carve out there so that within the model, which we don't know how many states will be included, but that does cover Medicaid patients and the fertility preservation is able to be included in that. And then in the commercial setting, it's fine. So the decision that HHS or the IG made does not affect commercial and also, again, CMMI, which we are encouraged and very hopeful that that will move quickly. And I am hopeful that there will be enough pressure and enough parties involved that will move to eventually change this. So by the time we're launching, I can't promise, but I don't anticipate it will be a huge market impact. And even in the coming years, I think that there are other opportunities for patients to be able to receive the gene editing therapies and the fertility preservations.

It might be worth just pausing for a second and just taking people through the acronyms and sort of the structure of... Yeah, sorry. No, no, no. It's just that, you know, what CMMI is.

So CMS has a section. It's the CMMI model, which is created to be able to explore and launch pilot programs to patients to different areas of need. There are a number that have been done in oncology over the last year or so. and they created a specific cell and gene therapy program of which the sickle cell disease area was highlighted and the program was initiated earlier this year, kicked off, and it is voluntary for both manufacturers and four states, so TBD on exactly who is involved in it, but the opportunity is there with a lot of funding for federal CMS through the CMMI model to be able to negotiate with manufacturers on behalf of a lot of states. So it takes out some of that work and that variability. Again, it is a promising program that needs to be moved forward quickly, but within it, there was a waiver on the anti-kickback statute around providing the fertility preservation. So, hopefully that gives a little bit better context.

Thanks very much, Karen.

Thank you.

Thank you. We'll take our next question from Lisa Baco with Evercore ISI. Your line is now open.

Hi, this is for Lisa. Thanks for taking our question. So there's a large number of patients in the Middle East, and can you please comment on how you plan to target this region? Do you plan to execute global launch yourself, or will you need a partner considering the complexities? Thank you.

Thanks very much, Jilin. I'm going to have Karen address that question.

Yes, great. Thank you. And we agree in the Middle East and there are other geographies where there is a significant unmet need As we've said and as was stated earlier, we continue to consider partnering for anything outside of the United States and any way that we can improve and accelerate access of therapies like Renicel to patients in need. So we continue to maintain that strategy, and we'll update as appropriate.

Thank you very much, Karen.

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