ADVM - NASDAQ

Adverum Biotechnologies and Year End 2019 Corporate Update Conference Call. At this time, all participants are in a listen only mode. Later we will conduct a question and answer session after the prepared. As a reminder, this call is being recorded. I would now like to hand the call over to Myesha Lacy, Vice President of Investor Relations and Corporate Communications at Adverum. Please go ahead.

Thank you, operator and welcome everyone. Today, we issued a press release reporting our financial results for the fourth quarter of 2019. A copy of this release is available on the press releases page of the Investor Relations section of our corporate Web site at www.adverum.com. Please note that a replay of today's call also will be available on the Events and Presentations section of our Web site.Joining me for the prepared remarks portion of the call today is Leone Patterson, President and Chief Executive Officer and Dr. Aaron Osborne, Chief Medical Officer. Then Leone, Aaron and our Chief Financial Officer, Thomas Leung, will be available for the Q&A portion of the call.As a reminder, we will be making forward-looking statements regarding our product development plan, research activities and operations, as well as our financial outlook. These statements are subject to risks and uncertainties that may cause actual results to differ materially from those forecasted. A description of these risks can be found in our 10-K, which was filed this afternoon.I would now like to turn the call over to our President and CEO, Leone Patterson.

Thank you, Myesha. Good afternoon, everyone, and thank you for joining us today. Before we dive into our business progress, I'd just like to acknowledge the fluid situation as it relates to coronavirus and the broader community. Like many companies, we are taking necessary precautions to support our employees and our business, and we will continue to monitor the situation closely.During this call, we'll review the significant momentum in advancing our lead gene therapy candidate, ADVM-022 and also provide a corporate update. Aaron will then review the significant clinical progress with ADVM-022 targeting with AMD, including recent data presentations and our plans for advancing a second indication, diabetic retinopathy, or DR. We will then open the call for questions. This is an exciting time to be working in gene therapy and to be part of what many consider to be a gene therapy in treating serious diseases.At Adverum we are focused on delivering what we believe can be transformative therapies for patients living with serious ocular and rare diseases. We believe our lead gene therapy program ADVM has the potential to be a onetime intravitreal injection gene therapy approach for our lead indications with AMD. This past year, we have gained significant momentum with our clinical progress in the development of 022 in the offset baseline dose ranging study. As a reminder, we have been exploring two doses in the OPTIC trial at 6 x 10^11 and a three-fold lower dose of 2 x 10^11.We have presented data from our first two cohorts, and I'm excited to announce that we recently completed dosing all nine patients in our third cohort. We can now focus on completing enrollment in Cohort 4, and screening of patients has begun. The clinical data presentations on OPTIC Cohorts 1 and 2 have been very promising where ADVM-022 demonstrated robust efficacy and evidence of a dose response.We look forward to presenting news clinical data from OPTIC in May this year. Additionally, we plan to present data from all four cohorts in the second half of this year. We also plan to develop 022 in a second indication in diabetic retinopathy or DR with an IND submission in the first half of 2020 and a Phase 1/2 beginning in the second half of the year. We are positioning our company to be a leader in gene therapy.Beyond ADVM-022, we are focused on developing a pipeline of novel gene therapies. Our industry leading AAV platform provides us with a number of compelling options for expansion, and we look forward to talking about this progress during the course of this year. Also, we are making great strides in other areas of our business. First, at the beginning of the year, we moved to a new headquarters in Redwood City. This move supports our growth plans and enables us to expand our core capabilities, including process development and manufacturing.Next, we appointed Angela Thedinga as Chief Technology Officer. Angela brings deep and relevant experience in gene therapy as she made [Technical Difficulty] efforts in developing the early manufacturing strategy, which enabled them to transition to early stage AAV manufacturing process to a scalable commercial manufacturing [indiscernible] culture in process. Angela will focus on leading our manufacturing strategy as we advance toward later stage clinical trials and prepare for potential commercialization.And finally, we are in a strong financial position with over $300 million in cash. After completing a public follow-on offering last month, raising net proceeds of approximately $141 million, which together with our end cash of $166 million is expected to fund operations into 2022.Before turning the call over to Aaron, I want to just share how excited I am to be leading this company where we are at the cutting edge of developing a potential one time treatment for patients with wet AMD and DR. We are committed to our mission to advance these programs in our pipeline of novel gene therapies for patients with serious ocular and rare diseases.I'd now like to turn the call over to Aaron who will provide further details on the clinical progress for ADVM-022. Aaron?

Thanks, Leone. Our primary focus as a company is always on the needs of our patient population. In this regard, to-date, we are not aware of any specific coronavirus impacts on the OPTIC trial. We are continuously monitoring the evolving situation with coronavirus and we’re making the communication with our clinical trial sites and our vendors involved in our clinical trials. Our thoughts and wishes are with everyone who has been impacted by COVID-19.Now turning to OPTIC. This has been a truly exciting time for ADVM-022 as we advance OPTIC for wet AMD and develop plans for a second clinical indication in diabetic retinopathy. OPTIC continues to progress very well. As Leone mentioned, we recently completed patient dosing in Cohort 3 and open screening for Cohort 4. There is strong support from the investigators and clinical sites to quickly enroll this cohort to allow us to share data from all four cohorts in a total of 30 patients later this year.In January of this see, Dr. Charles Wykoff, presented detailed efficacy and safety data from Cohort 1 patients. Then, in February, Dr. David Boyer presented us further update from OPTIC, including data from patients in Cohort 2, who received a threefold lower dose of ADVM-022. To briefly summarize the data from Cohorts 1 and 2, ADVM-022 demonstrated a robust efficacy signal and evidence of a dose response, which we measured as follows.In Cohort 1 using a dose of 6 x 10^11 vector genomes per eye, six patients remains rescue injection free at a median follow up of [50] weeks with three of those patients out to 52 weeks or beyond. In Cohort 2 using a threefold lower dose of 2 x 10^11, four sick patients were injection free at 24 weeks. This provides us further evidence of robust efficacy in addition to a dose response. In both cohorts combined, 10^11 or 83% of patients remained rescue free, rescue injection free. For these patients, vision was generally maintained as demonstrated by stable mean best corrected visual acuity [compared to] baseline, retinal anatomy improvements were achieved and maintained, as demonstrated by mean central sub-field thickness compared to baseline.It's important to remember that patients in OPTIC previously required frequent anti-VEGF injections to maintain their vision. In Cohorts 1 and 2, patients had received an average of over nine anti-VEGF injections in the 12 months prior to receiving ADVM-022 in OPTIC. The assessment of the safety is of paramount importance in early phase clinical trials. And we are pleased to report ADVM-022 continues to demonstrate a favorable safety profile with no drug related or procedure related serious adverse events, no drug related systemic adverse events and no adverse events meeting the criteria for dose limiting toxicity. Low grade inflammation that is responsive to steroids eyedrop treatment has been commonly reported. Importantly, we have seen no evidence of vasculitis, retinitis or choroiditis following intravitreal ADVM-022 administration.In Cohorts 3 and 4 of OPTIC, we're administering prophylactic steroid eyedrops instead of prophylactic oral steroids as were used in Cohorts 1 and 2. We believe that the use of steroid eyedrops will decrease the systemic exposure to steroids and allow for a longer period of steroid coverage, potentially reducing the occurrence of the generally mild inflammatory events that have been reported after cessation of oral steroids in Cohorts 1 and 2. We look forward to sharing the data from Cohorts 3 and 4 later this year.Given the promising data on ADVM-022 presented to-date, we're excited to move forward with our plans to explore a second indication diabetic retinopathy. Diabetic retinopathy represents another large and underserved market that may benefit from a onetime, long-lasting intravitreal anti-VEGF gene therapy. Of the estimated 8 million people with diabetic retinopathy in the U. S., only 2 million are diagnosed and only 1 million are treated. Retina specialists are very excited by the potential that a one-time intravitreal anti-VEGF therapy could offer. Currently, most patients with diabetic retinopathy do not receive anti-VEGF therapies due to concerns around their short duration of effect and subsequent risk of diabetic retinopathy progression and sight loss.Diabetic retinopathy is the leading cause of vision impairment and blindness amongst working age adults. As the prevalence of diabetes continues to grow, the prevalence of diabetic retinopathy is expected to increase. There is significant unmet needs for more effective and more durable anti-VEGF therapies that can reduce the incidents of sight-threatening complications and improved outcomes. We believe maintaining consistent levels of VEGF suppression with ADVM-022 could be particularly important for this rapidly progressing disease, potentially improving treatment outcomes over currently available therapies and allowing for an earlier time point of intervention.I will now turn the call back over to Leone.

Thanks, Aaron. We will now open the call to questions. Operator?

Thank you [Operator Instructions]. Our first question comes from Alethia Young with Cantor. You may proceed to your question.

Hey guys. Thanks for taking my questions, and congrats on the progress from angiogenesis. So maybe two from me, I just want you to maybe talk a little bit about kind of potential state of enrollment and Cohort 4. I don't know, I figured there was probably good demand in Cohort 3. So just wanted to see if there was any kind of perspective you could give on how fast that could enroll or do you kind of already have the people staked out? And my second question is on diabetic retinopathy. Can you talk about any kind of potential read-throughs that we might be able to start making from the AMD data that we've seen when we start thinking about potential efficacy there? And then maybe just can you touch upon how you think this therapy might be potentially more impactful and comparative than like perhaps let's say like a monthly dosing drug, like an Eylea or something like that versus kind of the standard of care, which still remains pretty prevalent in that population. Thanks.

So in terms of state of enrollments, I'll start in and see if Aaron has anything to add. But we're currently screening patients. Obviously, we're focused really heavily on getting those patients enrolled as soon as possible and it's very much part of what we're focused on primarily is to get the enrollment done. And 6 x 10^11, as you may recall, the efficacy we had with the first cohort, which is the same dose as cohort four is that we are still really showing robust efficacy, durability out to the longest time point now 50 week medium. So we believe that there is a lot of interest and we continue to hear that from investigators to enroll patients in that cohort 6 x 10^11. So, Aaron, I don't know if you have anything to add on that and we can go to the other two points as well.

So just to add, we're in sort of in daily contact with the investigators. We've got sites in the U. S. We know these investigators really well and they're truly excited about Cohort 4 and we're actively screening patients. We have many lined up to rapidly enroll Cohort 4.

And then in terms of DR and potential read-through, I think first of all obviously on the safety perspective, Phase 1 for OPTIC. It's a Phase 1 safety study. And so therefore the first and foremost thing is due to safety profile and that's why I think Cohorts 3 and 4 are important, because we're using prophylactic steroid eyedrops, which will hopefully manage the steroids --the inflammation that you may have been seen earlier on in Cohorts 1 and 2. So we do believe that there is some read-through that will be apparent from even the data we presented on with it comes to safety along with what we'll see in Cohorts 3 and 4 and using steroid eyedrops as the prophylactic measure.And as it relates to efficacy, yes, I think there can be some read through and I'll have Aaron speak to the disease, difference in the diseases between wet AMD and DR, because there is obviously some differences and with the doses that we would use in DR would be the same as what we would do in wet AMD would be useful to talk about the levels of VEGFs and compared to the two in the patient profile.

So the anti-VEGF patients that are approved at the moment, most of them are approved for use in diabetic macular edema, as well as in wet AMD and most doses have generally been the same. So drugs, the dose of anti-VEGF is effective in wet AMD will generally be effective in treating diabetic macular edema and also in improving diabetic retinopathy and there’s lot of evidence around that that exist already. So the efficacy that we're seeing in OPTIC is really exciting in terms of its possible applicability to diabetic retinopathy and diabetic macular edema.And I think just the second part of the question, which was on the difference between 022 and currently available anti-VEGFs, which are approved for diabetic retinopathy but are not currently used to any great extent. I think this really comes back to the durability and diabetic retinopathy is a disease that last for several years. And what can happen with the anti-VEGF therapies that are available is that they can superficially give the appearance to and improve the disease. But because of their short duration of action then the patient can actually experience complications if they do not come back to the clinic.And I think this is the promise of a sustained delivery approach in diabetic retinopathy that you can provide long lasting sustained anti-VEGF, which can hopefully tie that patient through the most active period assessed diabetic retinopathy and could reduce the risk of those sight threatening complications. And importantly, it's something that lasts for several months or years rather than something that last for just a few weeks. So that's all that when it starts to wear off. it does start to wear off this would happen much further down the line and the patient would be much less likely to experience the sight threatening complication. And I think that's why the retina community is really excited about the potential of intravitreal gene therapy to make a big difference in diabetic retinopathy.

Thank you. Our next question comes from Tara Bancroft with Piper Sandler. You may proceed with your question.

Its great to hear your progress so far, and also really promising to hear that you guys to be experiencing any delays with OPTIC due to COVID, so that’s great. So I was just wondering, if maybe I could get your thoughts on the recent safety signals that we're seeing with [Bayview] the data view and what it was about the product that you think may have led to that. Do you think there's any read through to intravitreal therapy in general and how this may affect sentiment towards longer lasting therapy like 022 could be? Thanks.

So I think I'll start off and then Aaron will obviously with his experience as an ophthalmologist and having worked on a number of the other anti-VEGF, so I think he could as some more specifically. But what I can say is, it's very different, the types of information that we're experiencing, which is as low grade manageable with topical steroids is very [Technical Difficulty] and the type of information that has been a contentious to [indiscernible]. So with that, I'll turn it over to Aaron to talk about some of the hypothesis on what's happening. But I think it will be really important to emphasize the difference of we are and hearing the type of information we have with this, but also where the information is occurring. So I’ll hand it over to you, Aaron.

Yes, obviously we’re concerned to hear those reports and the information with ADVM-022, which has been associated with sight loss has been reported to be a posterior inflammation, so an inflammation in the back part of the vitreous body for most vasculitis. So that means an inflammation affecting certain retinal vessels, which has resulted in the blood not being able to get to the retina and patients losing vision and that could potentially be permanent and that's called vasculitis. So, this is what really concerns, I think the retina community and there was a lot of discussion about that at recent Ophthalmology Meeting.So, in terms of what that potential route cause could be, we were focused on 022. But some of the things that come up, potentially something around -- this is remember that [indiscernible] is a novel therapy, which is a different class for the single chain antibody fragment, and those are not used that widely. So it's conceivable that there could be an issue with the production and there could be some contaminant there, or it could be related to that another thought is that it could be related specifically to it being a single chain fragment, which may penetrate deeper into the retina and maybe causing some problems in certain patients.And I think the third theory that people discussed is the fact that it's a very high dose of anti-VEGF, it's around 24 times the dose of ranibizumab or 12 times the dose of an Eylea intravitreal injection. So, those are sort of three areas that people are looking at to potentially explain what's happening here. I think importantly with 022, we have not seen any evidence of retinal vasculitis, we've not seen any evidence of any sorts of retinal inflammation. We do commonly see a no grade inflammation, which affects the front part of the eye following intravitreal injection of 022 and this is expected, we're injecting viral material and we expect some degree of immune response, but that inflammation is very low grade. It predominantly affects the front part of the eye and it's something that lasts over a longer period of time and it's manageable with topical steroids. So very different type of inflammation and we have not seen any evidence of that type of inflammation with ADVM-022.

Thank you. Our next question comes from Phil Nadeau with Cowen & Co. You may proceed with your question.

Maybe a couple on that information that you've seen. Have you decided on this third regimen that you're going to use in the DR trial now or does that await data from cohorts you planned for?

So basically, I think, thank you for bringing that up. So, a couple of things, one as I mentioned earlier, Cohort 3, we've completed dosing. Obviously, it's an open-label study. And we have grown drive into our Cohort 4 using the same protocols steroid eyedrops over six weeks, steroid eyedrops over six week tapering. So that gives you a sense of our level of confidence and comfort to move forward with that approach in that Cohort 4, which is that 6 x 10^11. The second part in terms of what we'd be using going forward for DR, DME. Obviously, we haven't submitted, we're still in the process of submitting IND in which we said we would get that done in the first half of this year and then we would have share a little bit more about the protocol design.But it's safe to say that given this is a patient population that would benefit from using topical steroids as opposed to oral, that we’ll be clearly looking at that as our potential way of managing any inflammation that we would see in that study. But we will need to wait till we actually get to the protocol design and willing to share that.

And just to follow up on your comments about the open label nature of Cohort 3. Could you just talk about maybe in a bit more detail what are you seeing there, and I guess in particular how many patients are passed the six week end of the prophylactic steroid regimen today? So you can see what the long-term efficacy of the six week cohort, I mean, the six week dosing paradigm?

I think that what I can say is that obviously at some point, we'll release the real data, Phil. But I think what we can say is just to remind you that there were nine patients that were enrolled. We enrolled our first patient in November. So it’s safe to say that we have a number of those patients out on six weeks, and I think the only thing I can say to that since we haven't presented data was to say that we felt with what we've seen to proceed with our dosing back to 6 x 10^11 using that same steroid regimen of topical steroids over six weeks.

And can you remind of us the dose of the topical steroids, would it be possible to increase the dose for cohort four if that was necessary?

I'll have Aaron answer that question. Go ahead, Aaron.

So we're giving 4 times a day drops for three weeks and then 3 times a day for a week, twice a day for a week, once a day for a week, and then stop. So, the maximum frequency is 4 times a today and eyedrops can potentially be given more frequently than that. So, that certainly would be one option if we needed to increase the amount of steroids being given. But based on the experience in cohorts one and two, the inflammation that we've seen has been manageable with those topical steroids. So obviously, we're now doing that experiment in Cohorts 3 and 4 and look forward to getting the data as quickly as possible.

Thank you [Operator Instructions]. Our next question comes from Patrick Dolezal with LifeSci Capital. You may proceed with your question.

I was just hoping you could guide expectations of the ARVO data update?

So as you may probably has heard today that ARVO especially is the in person meeting was canceled today. However, you will also see that we wrote in our press release and what we see today in our remarks that we do still plan to present data on the OPTIC trial in May. In terms of the ways that we will do that, obviously, we're waiting to hear back from ARVO. They are offering different ways to present data, it’s still kind of under ARVO, but without saying that we would still present data, we still plan to present data on OPTIC in May and as we’ve said. And it will be as part of the ARVO umbrella and whatever way they plan to allow presentation, just so we’re clear virtually or whatever way that happens, or it'll be, and/or it'll be some form of a webcast that we would do to support that as we have done previously and when we've done presentations of data.

And then I guess kind of playing off of Phil's question. If possible, could you provide any additional color on the status of the tapering of steroids used in Cohorts 1 and 2?

I think what I'll do, what we can talk about is what do we present at [NGL], I think in terms of any updates, we'd be providing there at a later time point. But I think it's safe to say that as we continue forward with the protocol in Cohort 3 and 4 that does give some level of insight that we are comfortable with using steroid eyedrops as the major prophylactic where you’re managing any inflammation that we see. But I had to see if Aaron has anything more to add there on the tapering. And I think a reminder of what the investigators can do beyond the tapering period might be useful as well.

So if you remember in Cohort 1, we had old patients we treated with prophylactic oral steroids, and there was really a learning process after that that different types of topical steroids we’ve given and some patients even got some more oral steroid, and the timing of that was kind of variable amongst degree. But through December 1st, which was the last time point that we analyze the data, we had one patient who has had an unrelated serious adverse event of a retinal detachment and was post surgery and actually that one patient who remains on the follow-up in optic that was the only patient that had any cellular inflammation, which potentially was postsurgical we would expect some cellular inflammation post retinal detachment surgery.The five others, none of those had any cellular inflammation at that time point. And we had two other patients two of those five patients were on a tapering amounts of steroids, which was two drops a day each and the other three were no longer on any topical steroids. So certainly the cellular inflammation was [indiscernible] and we had two patients remaining of those -- outside the one who was post surgical, we have two patients taking topical steroids. So that's cohort one.And the other data point that we have is Cohort 2, which was at the lower dose, a threefold lower dose, and we had, there we had out the six patients through 24 weeks follow up, two of the patients have not required any steroid eyedrops after their initial oral course and it had zero or next to zero inflammation. And we have two other patients who’ve absolutely minimal inflammation of a maximum of half plus, and those that had short courses of topical steroids and the inflammation have resolved and then we had another two patients who had more significant inflammation but that had, was improving or resolved and they were tapering eyedrops. So we had two patients in Cohort 2 who are on drops at week 24.The Cohort 3 obviously comes next and there we have all of the patients who are getting the six weeks of topical eyedrops, and we're hoping that those six weeks of topical eyedrops can reduce the occurrence of having any adverse events or spikes in inflammation early on and can hopefully for the patient on a better course. But it is important to remember this inflammation has been low grade, the vast majority of it has been asymptomatic, nothing affecting the back of the eye, so it's a predictable inflammation that seems to be very manageable with the topical steroids approach.

Thank you. I will now turn the call back to Adverum's, President and CEO, Leone Patterson.

All right. Thank you again for joining our call today. We have mentioned a real progress this past year. Looking ahead, key catalyst program this year are presenting new data from OPTIC in May, submitting an IND in diabetic retinopathy in the first half of this year, initiating our Phase 1/2 clinical trial beyond the second half of the year, and finally presenting data for all four cohorts of OPTIC in the second half. We look forward to sharing our clinical progress and continued execution as we advance the development of our novel gene therapy ADVM-022 for the treatment of serious ocular diseases.In closing, I'd like to thank the patients, care givers and retina specialists who are participating in the OPTIC trial. And last but certainly not least, I want to thank the Adverum employees for their tireless efforts. Our achievements that are there wouldn't be possible if it weren't for the dedication of this team. Thank you for your time and this concludes our call.