Selecta Biosciences, Inc.

And welcome to the Selecta Bio second quarter 2022 earnings release conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch tone phone. To withdraw your question, please press star, then two. Please note, this event is being recorded. I would now like to turn the conference over to Kevin Tan, Chief Financial Officer of Selecta Bio. Please go ahead.

Thank you and good morning. Welcome to our second quarter 2022 financial results and corporate update conference call. Press relief reporting our financial results is available in the investors and media section of Selecta's website, worldwidewebselectedbio.com, and our quarterly report on Form 10-Q for the quarter ended June 30th, 2022, which we intend to file in the coming days with the Securities and Exchange Commission, or SEC. Joining me today are Carson Bruhn, President and Chief Executive Officer, Peter Traber, Chief Medical Officer, and Kei Kishimoto, Chief Scientific Officer. During today's call, we will be making certain forward-looking statements, including without limitation, statements about the potential safety efficacy, regulatory and clinical progress of our product candidates, our financial projections, and our future expectations, plans, partnerships, and prospects. These statements are subject to various risks that are described in the filings made with the SEC, including our most recent annual report on Form 10-K. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today, August 4th, 2022, and selected as claims any obligation to update such statements, except as required by law, even if management's views change. I would now like to turn the call over to Carson Bruin. Carson?

Thank you, Kevin. Good morning. I appreciate everyone taking the time to join us today. In the second quarter of 2022, we made steady progress across our proprietary pipeline and achieved numerous key milestones. Most notably, on June 29th, We completed the enrollment of the DISSOLVE II trial, carrying a 10 million milestone payment obligation from SOBE. Our partners continue to progress the IMFOR platform in combination with their gene therapy candidates. And in June, Sarepta extended their option and license agreement for Dijon muscovistrophy and certain limb girdle muscovistrophy subtypes by nine months and achieved certain preclinical milestones. These two events resulted in total payment obligations of $6 million from Sarepta that we anticipate receiving in Q3 2022. Finally, on April 6, we priced an underwritten offering raising approximately $38.7 million. We believe that our existing cash, cash equivalents, restricted cash, and marketable securities as of June 30, 2022, will enable us to fund our operations into mid-2024. The second half of this year will be an important time for Selector as we anticipate completing the Phase III DISSOLVE trial in collaboration with our partner, SOBE. We expect to announce joint top-line data from DISSOLVE in Q1 2023. We also anticipate advancing SEL302, our proprietary gene therapy candidate to treat methylmalonic acidemia, or MMA, into the clinic and remain on track to commence the Phase I clinical trial in the fourth quarter of this year. Our team continues to advance our preclinical pipeline, most notably IND enabling studies and manufacturing scale-up for a proprietary ITG protease Zork to help unlock the power of gene therapies. IGA protease candidate selection with our partners Ginkgo Bioworks and Igon Biosciences for the treatment of IGA nephropathy and accelerating the development of IMTOR-L, which is the evolution of our Amazon Pacific Precision Immune Tolerance Platform. With an expected financial runway into mid-2024, we believe we're well positioned to reimagine immunotherapy in autoimmune disease, unlock the potential of AV gene therapy, and amplify the efficacy of biologic therapies. Let me now walk you through some of the key highlights and recent activities across all three pillars of our pipeline. Over 24 million Americans suffer from autoimmune diseases. The current standards of care utilize immunosuppressive drugs which often leave patients vulnerable to serious infections and malignancies, or symptoms-masking treatments, which fail to address the underlying cause of the disease. Our approach reimagines the treatment paradigm by addressing the underlying cause of autoimmune disease. Through our precision immune tolerance platform, we hope to restore immune system balance by inducing and expanding antigen-specific irregular T-cells, or Tregs, in vivo. As we've highlighted before, we're very excited about recent predictive data we've generated showing substantial synergistic activity when mTOR is combined with engineered IL-2 molecules that are selected for TBEX, an evolution of a platform we call mTOR-IL. A top priority for Selector in 2022 is accelerating the development of a proprietary engineered IL-2 to combine with mTOR. We have partnered with Cyrus Biotechnology, a world-leading protein engineering company spun out of David Baker's lab at the University of Washington to facilitate development of our next generation highly differentiated IL-2 mutine to combine with mTOR. Unlike other programs in development using engineered Treg selective IL-2 molecules that focus on generalized expansion of Tregs, mTOR and mTOR-L, when combined with antigen of interest, is focused on induction and expansion of TVEX specific to those autoantigens responsible for the pathogenesis of autoimmune diseases. We believe our technology has the potential to be a truly differentiated, first-in-class, antigen-specific treatment for autoimmune diseases. The first autoimmune indication in which we plan to evaluate our precision immune tolerance platform is in primary bilirucal angiitis, or PPC, a T-cell-mediated liver disease driven by a well-defined antigen, PDCE2. In PBC, the immune system mistakenly attacks tissue in the liver and damage the small bile ducts. While treatments to help slow the progression and prevent complications in PBC are available, approximately 30 to 40% of patients are intolerant to or do not respond to these treatments, leaving patients with limited alternative treatment options and a significant unmet need. Co-administering IM2RL with PDCE2, the autoantigen implicated in PVC, may result in the expansion of TVEX specific to PDCE2 and restore immune system balance. We continue to work toward additional indication selection, and we plan to expand into other autoimmune indications. We expect to provide updates on our strategic development path for IM2RL in the near future. Now moving on to our gene therapy pipelines. In Q4 2022, we anticipate starting a phase one trial of SEL302, a combination of mTOR with MMA101, an AAV gene therapy being developed for the treatment of MMA. MMA is a rare metabolic disease in which the body cannot break down certain proteins and fats. The phase one trial will evaluate the safety and efficacy of SEL302 in treating MMA and mTOR's ability to mitigate neutralizing antibodies against the MMA101 AAV capsid. We hope this trial will build on our growing body of evidence pointing towards the potentially multifaceted benefits of mTOR, enhancing the efficacy and safety of AAV gene therapies. Additionally, development of SEL302 could provide an important regulatory and clinical blueprint for our current and future gene therapy partners. potentially accelerating development of safer and redosable AEB gene therapies for patients suffering from rare genetic diseases. This past May, at the American Society of Gene and Cell Therapy, Selecta showcased six presentations, including three from our partnership with AskBio. Our CSO, Kei Kishimoto, was awarded an Outstanding Poster Presentation Award for his abstract titled, Combination of mTOR tolerogenic nanoparticles and IL-2 mutine synergistically inhibits the formation of anti-AV antibodies. This poster showed mTOR-L had the ability to induce durable immune tolerance to a co-administered AV gene therapy vector in mice and demonstrated complete inhibition of anti-AV antibody formation after multiple doses of gene therapy through 117 days. Notably, this effect was observed and would be considered sub-therapeutic doses for mTOR alone. Building on this, today we're pleased to report new data from preclinical studies in mice using gene therapy vector doses of 5E13 Vg per kick, or 10 times the dose of prior studies. This study demonstrated that a single dose of mTOR plus four monthly doses of IL-2 co-administered with AV8 CEEP produced durable mitigation of anti-AV antibodies over 131 days. When combined with our human proof of concept study, where we observed mTOR's ability to inhibit the formation of the dosing antibodies in healthy human volunteers out to 30 days, we believe these results suggest that mTOR-L has the potential to solve the redosing problem associated with AV gene therapies and transform the treatment paradigm from one and done to low and slow, whereby patients could receive multiple doses of gene therapy to titrate up to a therapeutic benefit and avoid the risks associated with high vector doses of gene therapy needed in a one-time only treatment model. Another key challenge facing the gene therapy modality is one of accessibility. Currently, 30 to 70% of patient population for gene therapy trials are ineligible for inclusion due to preexisting nucleosine anti-AEV antibodies, which are a result of natural infections. Thus, many patients in need are unable to access potentially life-altering therapies, for which there may be few or no treatment alternatives. IgG proteases have shown promise as a pretreatment to transiently clear preexisting nucleosine antibodies and create a window during which AB gene therapies could be administered. However, ITG proteases are derived from bacteria and are themselves highly immunogenic. Additionally, some ITG proteases are derived from a common human pathogen, and consequently, the vast majority of individuals have preexisting antibodies against these proteases. Zork, our proprietary ITG protease candidate, has been optimized to specifically cleave human ITG, but is derived from a non-human pathogen, and we have observed low cross-reactivity to preexisting anti-ITG protease antibodies. We believe that the combination of ZORC with mTOR could enable repeat dosing of this enzyme therapy. We continue with IND enabling studies and manufacturing scale-up. I want to take a moment to discuss how important we believe ZORC could be for the gene therapy modality. For many patients with rare genetic diseases, gene therapy could represent the most promising treatment option. Unfortunately, many patients are ineligible for gene therapy due to preexisting anti-AV antibodies. By using Zork to open a therapeutic treatment window for these patients, we have the potential to bring hope to those who may not have any other effective treatment options. At the same time, by increasing the eligible patient population, we can help companies maximize the commercial potential of their gene therapy candidates. We're taking a multi-pronged approach to tackling the immunogenicity challenges facing AAV gene therapies. mTOR and mTOR-L to mitigate the de novo formation of neutralizing antibodies and enable redosing and Zork to address those patients who due to natural AAV infections are ineligible for treatment by gene therapies. We continue to progress our gene therapy platform toward the goal of providing an industry-leading toolbox capable of unlocking the true promise of AV chin therapies. We plan to maximize the value of our platform by actively pursuing business development and outlining opportunities for both mTOR and Zork. Lastly, I want to provide an update on our Biologics pipeline, starting with SEL212, which we believe has served as clinical proof of concept for a precision immune tolerance platform with approximately 450 patients dosed to date. Many biologics can be highly immunogenic, resulting in suboptimal responses due to the development of anti-drug antibodies after multiple treatments. Patients that develop an immune response may be forced to discontinue treatment or experience adverse reactions. We believe the use of mTOR as an adjunct to biologics offers a promising approach to reduce this immune response and improve patient outcomes. SEL212 is comprised of mTOR co-administered with a proprietary urocase, the GATU case, for the treatment of chronic refractory gout and was licensed to SOBE in 2020. Our phase three dissolved clinical program picked up in the third quarter of 2020 and consists of two double-blind placebo-controlled trials of SEL212. In both trials, SEL212 is being evaluated at two dose levels of mTOR, 0.1 mgs per kg and 0.15 mgs per kg, with a single dose level of Picatricase of 0.2 mgs per kg. On December 1, 2021, we announced full enrollment for DISSOLVE-1, with 112 patients enrolled in the United States, and we recently closed enrollment at 153 subjects for DISSOLVE-2, which has been conducted in four countries across Eastern Europe and the United States. As a reminder, we increased target enrollment of Dissolve-2 from 120 subjects to mitigate any subject discontentations due to the ongoing geopolitical events in Russia and Ukraine. Achievement of full enrollment in Dissolve-2 triggered a 10 million payment obligation from SOBI, and we remain on track to complete both studies in Q4 2022 with joint top-line data anticipated in Q1 2023. We plan to work closely with our partner SOBI our clinical trial providers, and regulatory authorities to advance to a successful completion of the DISSOLVE program. With extensive clinical data in SEL212 currently in phase three, we believe our biologics pipeline is mechanistically de-risked and Selecta is well positioned to leverage these learnings into our second biologic indications in IgA nephropathy, a kidney disease that occurs when immune complexes of an antibody called immunoglobulin A1 or IgA1 accumulate in the kidneys. Current treatments fail to address the IgA protein deposits, which is the underlying pathophysiology of the disease. We believe our novel approach, which combines mTOR with an IgA1 protease, has the potential to move injurious IgA from the kidneys, improve markers of renal function, and have a transformative impact on patients' lives. We are currently working with our external partners to identify an IGA Pro Days candidate for this program and hope to finalize clinical candidate selection by year end. We're extremely excited about the advancements across all three pillars of our pipeline and the value driving milestones in the second half of 2022 and beyond. With that, I'll turn the call over to Kevin to run through our financial results for the second quarter ended June 30th, 2022. Kevin.