VYGR - NASDAQ

Good morning and welcome to Voyager Therapeutics 2022 Fourth Quarter and Year End Conference Call. All participants are now in listen-only mode. [Operator Instructions] Please be advised this call is being recorded at the company’s request. A replay of today’s call will be available on the Investor section of the company’s website approximately 2 hours after completion of this call. I would now like to turn the call over to Pete Pfreundschuh, Chief Financial Officer.

Thank you and good morning. Joining me on today’s call are Dr. Al Sandrock, our CEO; Dr. Todd Carter, our Chief Scientific Officer; and Allen Nunnally, our Chief Business Officer. We issued our Q4 and year end 2022 press release this morning. The press release and 10-K are available on our website. We plan to provide a brief summary of key highlights from the quarter and reserve the majority of time for your Q&A. In a moment, I will turn the call over to Al. Before I do this, I want to remind everyone that during this call, Voyager representatives may make forward-looking statements regarding future expectations, plans and prospects. All forward-looking statements are inherently uncertain and are subject to risks and uncertainties that may cause actual results to differ materially from those indicated by these forward-looking statements. You are encouraged to review and understand a number of the material risks and uncertainties facing the company as described in the company’s annual report on Form 10-K filed with the SEC this morning. All SEC filings are available on the company’s website. Now, it is my pleasure to turn the call over to Al.

Thank you, Pete and good morning everyone. I would like to start by acknowledging the transformation Voyager has undergone in 2022. Since I became CEO last March, we have advanced a pipeline focused on some of the most significant unmet needs in neurology, achieved breakthrough innovations in novel capsid discovery, including the identification of a receptor for one class of capsids and entered multiple high value collaborations. Thanks to this progress during a time when markets have been very difficult for much of the sector, we have created value for shareholders and we have made important steps towards creating value for patients. I believe we will continue to do so as we focus on the three pillars of our investment rationale. Our first pillar of value is our TRACER capsid discovery platform. The Voyager team evaluated multiple libraries, each with more than 20 million variants of AAV5 and AAV9 capsids to select those capsids that display increased transduction in the central nervous system following intravenous delivery. In preclinical studies, we have demonstrated more than 100-fold higher transgene expression in the brain compared to conventional AAV9 capsids. We have shown high levels of CNS expression at low doses and we have demonstrated the ability to target specific cells such as neurons or glial cells, while detargeting the liver and dorsal root ganglion cells. This is why I came to Voyager. Our scientists never cease to impress me with their innovation. Last year, they identified the receptor for one of our capsid families and I am looking forward to seeing what they accomplished this year. I am not the only one impressed by Voyager’s innovation. The data we have generated have allowed us to secure partnerships with gene therapy leaders, like Pfizer and Novartis and with neurology leaders like Neurocrine. Our second pillar of value which is our – which our recent transaction with Neurocrine brought into the spotlight is our CNS pipeline. This is a result of combining Voyager’s novel TRACER capsid platform with our deep knowledge of neuropharmacology and payloads. We select diseases with high unmet need, where the target is well validated by human genetics and human biology and where biomarkers may enable a path to quickly and efficiently achieve proof of biology. We then design a payload and our diverse payload capabilities allow us to access a wide variety of targets. We can use gene replacement to address loss of function mutations, vectorized siRNAs to address toxic gain of function mutations and vectorized antibodies to address extracellular or cell surface CNS targets. As I mentioned, the value of our pipeline was recently illustrated through our strategic collaboration with Neurocrine Biosciences. This provided $175 million upfront and up to $4.2 billion in potential milestones for rights to our GBA1 gene therapy program for Parkinson’s disease and 3 additional gene therapy programs directed to rare CNS targets. And this leads me to our third pillar of value, partnerships. We have a sound balance sheet enabled by our track record of generating non-dilutive collaboration revenue. Allen and Pete will expand more on that in a minute. I will just note that Voyager is open to a wide variety of collaboration structures to enabled neurogenetic medicine. We have executed strategic collaborations around our pipeline programs, such as with Neurocrine. We have completed capsid option and license agreements, such as with Pfizer and Novartis. And we are interested in and evaluating creative deal structures, such as opportunity to combine our capsid and receptor technology with cutting-edge payloads and biologics. It is important to note that we are advancing and we intend to continue to advance wholly-owned programs. The non-dilutive financing from our partnerships is a key enabler of our wholly-owned programs. Now, I will turn the call over to Allen to review the recent Novartis transaction.

Thank you, Al. Please turn to Slide 4. As Al said, Voyager is open to a variety of collaboration structures. Earlier this year, we announced a strategic collaboration with Neurocrine to advance our GBA1 gene therapy program as well as three new gene therapy programs directed to rare CNS targets. We received $175 million upfront and are eligible for up to $1.5 billion in potential development milestones and up to $2.7 billion in potential commercial milestone, tiered royalties on net sales, program funding, and an option to elect 50/50 cost and profit-sharing in the U.S for the GBA1 program following Phase 1 read out. This type of cost and risk sharing structure provides transformational value for Voyager and it is one of a variety of structures we have executed. We have also entered capsid option and license agreements with Pfizer and Novartis. Last year, Pfizer exercised its option to a capsid against the CNS target. And earlier this month, Novartis exercised its options to capsids against two neurologic disease targets. As a reminder, Voyager received $54 million upfront from Novartis when this option agreement was signed in March 2022. For the last year, Novartis has been evaluating our capsids, their decision to license capsids for two CNS targets triggers $25 million in option exercise fees and Voyager is eligible to receive up to $600 million in associated development, regulatory and commercial milestone payments as well as mid to high single-digit tiered royalties based on the net sales of Novartis products incorporating the licensed capsids. Novartis also retains the right over the next 18 months to expand the scope of options to evaluate and license capsids for up to two additional CNS targets, subject to their availability for $18 million per target and the $12.5 million fee per target upon exercise of the option to license a capsid as well as milestones and royalties. It’s important to note here that we at Voyager view Novartis as one of the current leaders in gene therapy field. Their decision to license our novel intravenous AAV capsids to enable gene therapies for CNS diseases is very exciting. We look forward to continuing this relationship. Now I will turn it over to Pete to review our balance sheet.

Thank you, Allen. Please turn to Slide 5. Voyager is committed to maintaining a strong balance sheet that supports advancement of its platform and pipeline. As of December 31, 2022, we reported cash, cash equivalents and marketable securities of $118.8 million. As Allen described, earlier this year, we received $175 million from Neurocrine and we will now receive $25 million from Novartis for the exercise of the options. On a pro forma basis, when you factor in Neurocrine and Novartis payments, the company has cash, cash equivalents and marketable securities of approximately $320 million. Voyager is committed to maintaining a strong balance sheet and financial discipline. We expect that our cash, cash equivalents and marketable securities, together with amounts expected to be received as reimbursements for development costs under the Neurocrine collaborations will be sufficient to meet our planned operating expenses and capital expenditure requirements into 2025. This enables the advancement of our two wholly-owned programs, the anti-tau antibody for Alzheimer’s disease, and the SOD1 gene therapy for ALS into clinical trials. We expect the filing of INDs for both programs in 2024. And Al will now expand on these and other programs in our pipeline.

Thanks, Pete. And now on Slide 6, you can see that Voyager has four programs advancing through late research. As Pete stated, two of these programs are wholly-owned, our humanized anti-tau antibody for Alzheimer’s disease and SOD1 gene silencing program for ALS. Our anti-tau program is differentiated from others that have not demonstrated clinical efficacy and that we target the C terminal rather than the N terminal region. Moreover, our antibody blocks the spreads of pathological tau in animal models, whereas the N terminal antibodies don’t. We believe that both of these distinguishing features may prove to be very important as we attempt to block the spread of pathological tau in patients with Alzheimer’s disease. In January, we selected a humanized development candidate to advance into IND-enabling studies. Data that led to the selection of this candidate will be presented at the AD/PD conference in Sweden later this month. Voyager expects to initiate a GLP toxicology study this year in order to enable a potential IND filing in the first half of 2024. Our SOD1 ALS program combines a potent siRNA construct with a CNS tropic blood brain barrier penetrant novel TRACER derived capsid. Proof of concept of the therapeutic hypothesis has been demonstrated by Tofersen, an investigational drug sponsored by Biogen and IONIS as shown in the September 2022, New England Journal of Medicine publication. Tofersen is currently under review by FDA, and, if approved, could blaze a trial that we could then follow with a gene therapy solution. We are continuing to conduct non-human primate studies to select our lead candidate, which we expect will occur in the first half of this year. And we continue to expect to file an IND in 2024 for this program as well. Our other two preclinical programs, the GBA1 gene therapy for Parkinson’s disease and other GBA1 mediated diseases and the [indiscernible] gene therapy program for Friedreich’s ataxia are being advanced in collaboration with Neurocrine. Neurocrine is fully funding both of these programs through Phase 1, at which point Voyager has an option to co-develop and co-commercialize the assets in the United States. We also continue to advance multiple early research initiatives, including a vectorized antibody for brain metastases associated with HER2 positive breast cancer and a vectorized siRNA approach to enable specific knockdown of mutant Huntington and MSH3, in Huntington’s disease. Today, I’m also excited to introduce a new gene therapy program for Alzheimer’s disease. Slide 7 shows the rationale for our new research effort in Alzheimer’s disease, which builds upon our tau expertise. This new program targets intracellular tau with a vectorized siRNA gene silencing approach. We know that tau pathology closely correlates with Alzheimer’s disease progression and cognitive decline. An siRNA gene therapy approach could enable us to knock downtown tau with in neuron this could be efficacious by itself, and also has the potential to complement extracellular approaches, such as our anti-tau antibody effort. The unmet need and Alzheimer’s disease is enormous. And while we’re extremely encouraged by the recent advances with anti-amyloid antibodies, we believe that combination therapies may improve outcomes much as they have in oncology. This could mean combining anti-amyloid and anti-tau approaches or combining extracellular and intracellular tau approaches. We are currently evaluating an siRNA tau gene silencing payload with our intravenous brain penetrant novel capsid. Turning to Slide 8. In summary, Voyager has demonstrated our ability to execute and creating value through 2022 and into 2023. In addition to advancing our pipeline, we entered into multiple important collaborations, and significantly strengthened our balance sheet. Looking towards 2023, we continue our work to break through the barriers constraining the fields of gene therapy and neurology. We intend to identify a lead candidate for SOD1 ALS program. And we will advance our GBA1 and [indiscernible] programs collaboratively with Neurocrine. We will continue to share the exciting data we are generating at scientific conferences, including FD AD/PD conference later this month. And finally, we continue to engage in active discussions with potential partners around our platform and timeline. I want to take a moment to thank everyone on the Voyager team for their incredible work in 2022. Together, I look forward to continuing to build Voyager in the next year. And we’re off to a great start. With that, we are happy to take any questions you may have. Operator?

Thank you. [Operator Instructions] Our first question comes from Jack Allen with Baird. your line is open.

Great, thank you so much. And congratulations to the team on all the progress made over the course of the quarter. I guess to start, I’m hoping we could talk broadly about the TRACER capsids and then move towards a clinic. I know that you have your ALS SOD1 program that’s wholly owned, and you’re guiding towards an IND in the first half of 2023. But do you expect that to be the first tracer TRACER capsids to move towards an IND? Or could it be a partner program that a progressive as well, on a similar timeline or maybe even a more rapid timeline? How should we think about is gene therapy assets moving to the clinic? And then I have a few follow-ups as well for me.

Hi, Jack, this is Al Sandrock. So actually, our IND for SOD1 ALS is planned for 2024. And it may very well be the very first capsid in the clinic from TRACER platform. But it’s hard to know because, we have these multiple partner programs. And of course, the timelines for these partner programs are in their hands. And so it will be neck and neck likely. But so but I think that roughly in the 2024, 2025 timeframe is when a lot of these INDs will come into play. Todd, do you have anything to add to that?

Sounds very well.

Thank you.

Great. And then if I made a few brief follow-up programs, there’s been a lot of headlines around the procurement of non-human primates, particularly the supply coming out of Cambodia. And I think, Charles River Labs is slowing their imports. I wonder if you had any comments on your ability to get your hands on these non-human primates and what kind of competence you have on your preclinical timelines moving forward. And then maybe outside of that question I wanted to touch on just the Pfizer and Novartis relationships. It’s really great to see the two major leaders in gene therapy opt into some programs, but they also decided to not opt into some other programs. And I was wondering if so right, so those targets refer back to you and if there’s any work that you could leverage on those targets to rapidly advance assets towards a clinic.

Thanks, Jack, this is Al, again. I’ll answer the non-human primate question and I’ll have Allen Nunnally have answer the Pfizer, Novartis question. But, yes, now it’s a real serious problem. Every company that I know of in this industry relies on non-human primates for one thing or another, and of course, our TRACER platform begins in the non-human primates. And so it’s a serious problem. I’m not aware as of today of any delay in our programs, but I’m keeping my fingers crossed because anything can happen and so I hope this gets resolved because there are a lot of patients waiting for drugs. And this is pretty bad news for the whole industry. I think, Todd?

Yes. I’ll just add that we do use multiple vendors to try to reduce that risk, but serious we’re looking at very closely.

Allan, do you want to add?

Sure, Jack, this is Allan, thanks for the question on Pfizer and Novartis. So in each of those relationships, there was one target that for Pfizer and one targets for Novartis that they did not exercise an option to attach with. So the rights with respect to our capsids for those targets do revert to Voyager. But because the programs are being prosecuted entirely on the partner side, Pfizer and Novartis, we don’t have information about the program or any rights in the programs. So we just simply have back the rights to do those targets ourselves or to partner on those targets for our – with our TRACER capsids with other parties.

Great, thank you so much for the multiple questions, and congratulations again on the progress.

Thanks, Jack.

[Operator Instructions] Our next question comes from Joon Lee with Truist your line is open.

Hi, congrats on the progress. And thanks for taking our questions. I have a question on the target receptor you identified. Is the receptor X sufficient for a delivery or is there a co-receptor or co-ligand that is necessary to complete the process of AV delivery, and also with the identification of this receptor X, are you considering delivery modalities other than A, B, such as coding the LMP, or fusing it to the ASL or siRNA and have a follow-up question. Thank you.

Yes. Hi, this is Todd, thank you for the question. Receptor X and the question of a co-ligand, we have not identified co-ligand, we know and it’s shown that the receptor is sufficient to increase transduction in vitro settings. So the increased expression of it alone can result in dramatically increased uptake and transduction. And we have ongoing experiments to further elucidate that and [indiscernible] with regard to the question about delivery of other things. It’s something we’re actively exploring delivery of other modalities, and we have some early exploratory work right now for [indiscernible].

Great. And with this – with your capsids by how much are you able to lower the systemic dosing inhuman compared to for example, so [indiscernible] which has a dosing of about 22 to 14?

Hi, it’s Todd, again. So that’s a great question. And it depends upon the target tissue, and the amount of delivery you need. So our goal is to improve the therapeutic index and deliver sufficient or hopefully possibility of more than sufficient to the target tissues. And you can do that in two ways. One, at a given dose, you can deliver more to say the brain, which results in the ability to lower the dose and result in delivering less to the liver, for example, the off-target tissues. So it’s this ratio of on targets to off target that’s the question. In addition, we have shown, for example, with some of our capsids that we can dramatically reduce the dose, a 10 to 50-fold, and still get dramatic delivery into the CNS of non-human primates. So both of those goals are something we’ve seen with our capsids, I think at a minimum, what we’re looking for is to go from the e14, a level that’s seen quite often with the AAV9 and related capsids, and to get into the e13 per kilogram or lower doses.

Great. And one final questions for me, I know it’s difficult to with given your potential milestones from the three collaborators, but curious if you’re able to provide any cash funding guidance based on the $320 million in performing cash and if you’re planning for any capital expenditures related to in-house manufacturing, scale up or etcetera, in the next few years. Thank you.

Yes, Jim, this is Pete. So part of our actual presentation today, I think we did provide cash flow guidance with regards to runway, we said that we were going into 2025 with parts of the balance sheet and our ability there. I do want to highlight a couple things. I think we have a really strong balance sheet. We started this year with $320 million between our Neurocrine transaction as well as the Novartis transaction. Our balance sheet cash flow projections, I want to say they do not include the future potential milestones associated with the collaborations that are existing. So that actually can actually extend that runway further beyond those projections. With regards to our burn for 2022, our burn was actually $70 million. And overall, we were very capital efficient as organization with regards to our expenditures, and deployment of cash, our cash flow projections for 2023, although we don’t provide specific guidance with regards to that, we do anticipate those projections to actually go up year-on-year, although that’s really the advancement of our wholly owned programs. I think, as we’ve described for you guys here today. I think for the most of our – it is our anticipation that as we move forward over the next couple of years, that are costs will increase somewhat meaningful associated with the development of our programs, especially as we get into clinical trials. However, with that being said, one of the things that we’ve done really well as an organization is we’ve actually been able to do non-dilutive financing associated with our programs. And as you can see, over the last 6 months or so, we actually generated over $200 million in non-dilutive financings associated with the deals that we did. So I think, it is our overall goal and game plan to continue to be able to finance the company into the future based upon additional non-dilutive deals that we can do, but also be able to mitigate kind of costs through partnerships and other types of arrangements.

Great, thanks for taking our questions and congrats on the execution and looking forward to progress.

Sure.

Thank you.

[Operator Instructions] Our next question comes from Dane Leone with Raymond James. Your line is open.

Hi, thanks for taking the questions. Can you just maybe take us more specifically through the steps of the program focused on SOD1 this year, that will help derisk the program getting into that IND phase in the earlier part of next year? Said differently, what do you still need to do experiment wise to get to that lead drug candidate bait? And then what do you need to do to actually finish the talk studies required to get the IND open? Thank you.

Hi, Dane, this is Al Sandrock, I’m going to turn it over to Todd in a minute. Yes, I think that there’s some key milestones here first is nominating a development candidate. In other words, combining a transgene with one of our tests, and we have a capsid profile that we’ve already developed, that we think we need in order to be effective in SOD1 ALS, I think an important thing to track for us is what’s going on with Tofersen. As you know, there’s going to be an FDA Advisory Committee this month, and the decision by FDA will come next month, that will give us a lot of insight into how to develop this drug, and even how to get it approved and make it available to patients. So and after the development candidate is identified, will have to start GLP tox studies, and will – and of course, there’s going to be important interactions with FDA as we approach the IND, which we plan for next year. It’s still on track for next year. Todd, do you have anything to add to that?

I think you have captured the bulk of it now. I mean, the next steps are the identification of the LEED nomination that I’ll mentioned. We’re still tracking to the first half of this year on that and we’re reasonably on track for our IND filing in 2024.

Thank you.

[Operator Instructions] Our next question comes from Yun

Hi, good morning. Thank you very much for taking the question. So I noticed that none of the pipeline program is actually using the vectorized antibody approach? And given that you had reported HER2 data in the past, what kind of indication do you think a vectorized antibody approach could be suited for?

Hi, this is Al, I will start and ask Todd to continue. But, yes, I mean I think it’s a very powerful technology that’s been developed here at Voyager over the years. And it’s going to be suitable for any target that is extracellular, or on the cell surface of either neurons or real cells or other kinds of cells, non-neuronal cells in the CNS. So, that actually is a pretty large number of targets. And look, we are a lead program for tau is the antibody. It’s a passive immunotherapy, as you have pointed out. But we always have the option to vectorize it later we feel like it’s the shortest path, very efficient cost effective and rapid path to get proof-of-concept, just using it as passive immunotherapy. After we get the proof-of-concept, and we have multiple options available to us. Todd?

And we see that a lot of potential value in our vectorized antibody platform and remain pretty excited about it. Are we here to program, we are still interested and excited about that it’s an earlier stage, much like our HD program. We are hopeful that the data will continue to be generated and results in advancement of that program. And we are always interested in other approaches with the vectorized antibody platform as well.

Okay. So, my next question is on the collaboration was Neurocrine. I believe the FA program and also some additional gene therapy programs were part of an audit collaboration with Neurocrine. So, is it reasonable to assume that now they are also going to be based on TRACER technology platform?

Yes, this is Alfred Sandrock again. This is – the original Neurocrine deal was signed before the availability of the TRACER capsids. But it’s fair to say that we both companies are now very interested in moving forward for free drugs and those other two programs that you mentioned with the novel capsids.

Okay. Great. Thank you very much.

[Operator Instructions] Our next question comes from Laura Chico with Wedbush. Your line is open.

Hey, good morning, guys. Thanks very much for taking the question. I guess I have one related to Neurocrine collaboration as well. Wondering specifically for the Parkinson’s, the GBA1 program. If you could speak a little bit more to kind of the thought process leading to kind of exercising the co-development, co-commercialization option, obviously, still early days here, but just wondering if you could maybe discuss that a little further in terms of what would incentivize you or make this a promising deal to opt in to continue there. And then second, there has been a recent approval in the Friedreich’s Ataxia space, just wondering how that might change or influence kind of the path forward there? Thanks very much.

Hello, this is Sandrock, again. Yes, so for very common diseases like Parkinson’s disease and Alzheimer’s disease, it’s hard to imagine that Voyager would be able to go all the way to late-stage clinical trials, which tend to be rather than large, or to commercialization. So, it was never a question of whether we would partner with those, it was always a question of when and our colleagues at Northwind was very excited about the program. I should say that it was a very competitive process. A lot of people were excited about GBA1 gene, because it makes so much sense. I think it’s a highly validated target. And so we decided to do the deal and it provided non-dilutive revenue for us to pursue other programs. And we just outlined one new one of this morning. In terms of [indiscernible] is after Phase 1. And we don’t know what the Phase 1 trial design is yet, it’s up to Neurocrine to tell us. But it’s very possible that after Phase 1, we will see whether or not the gene therapy produces the enzyme which we should be able to measure in the spinal fluid. And whether or not it reduces the substrates that build up abnormally in the spinal fluid in GBA1 carriers with Parkinson’s disease. So, that – so after proof of biology perhaps, but again, it depends on what the Phase 1 trial design is. And we have – we don’t know what that is yet, but that’s a possibility that I just outlined. In terms of the approval of the drug by Regatta, the Nrf2 activator, I think it’s very, very exciting. This is a disease that had no treatment until last week, and it’s a terrible disease. And I don’t – I think it’s very encouraging for the whole field. And so Friedreich’s Ataxia is, I think what happens typically is that after the first approval, other companies get involved and it just lifts all boats. And so I think it’s only good news for us.

Thanks very much.

Laura, this is Allen Nunnally, only one thing just to add on the options for cost/profit share, is a good way for preserving optionality for Voyager is outside, we will get to take a look at the data from that Phase 1 trial, see how we are situated and we will have an attractive option between the U.S. 50-50 cost/profit share, and really healthy milestone and royalty track. So, we are happy to be able to preserve that optionality after the Phase 1.

I mean a comment on the surface, in addition to what else and the mechanisms by which Regatta tourism of the last one works are different from our gene therapy approach. And so the two approaches are not exclusive at all. So, we are quite excited about the Regatta program.

Yes. And I should add that, it gives us an idea of what the Phase 3 trial needs to be. We now know what the outcome measure should be for regulatory approval, we see what happens – we see the change in that outcome measure over the course of time, so we can have better power our studies. I mean it’s just a huge easy positive event, I believe for patients with Friedreich’s Ataxia.

Thanks very much.

[Operator Instructions] Our next question comes from Sumant Kulkarni with Canaccord. Your line is open.

Hi, congrats on the quarter. This is actually Ross asking questions on behalf for Sumant. Two questions regards to Receptor-X that you have identified, given that you have been developing these novel capsids for some time now, are your latest thoughts on the level of receptor expression and variability across primates and mice? And what’s your confidence level on how that might translate to humans?

Alright. This is Todd. So, we know that Receptor-X is expressed in the right cells and in the right places in all of the species in mice in non-human primates. And in humans, we know that the capsids find the orthologs for all those species, and that the orthologs the protein versions from each of those species enhance transduction in our in vitro studies. And so we are – we think that the translation of the humans is greatly de-risk. And there is a greater chance of success because of all of this data.

Okay. And then, kind of a quick follow-up is, is there any potential for these capsids to effect out of brain, and if so how might this concerning be mitigated, if this is kind of area of concern?

Well, we do check all the other organs when we – the TRACER platform allows us to actually look at messenger RNA expression of these capsids in multiple organs simultaneously. And what we find is actually it’s anything decrease transduction in places like the liver, so many of our novel capsids, which are importantly get into the CNS, they tend to de-target the liver, for example. Have we looked at every single organ, no, not yet. But so far, it doesn’t look like there is significant efflux, at least to the point where we get transduction of organs in the periphery. Todd, do you want to add anything?

Sure. There is opportunities in both directions to your question actually. One is to deliver to the CNS, which has been our focus, looking for those capsids that deliver better to the CNS, and less well to the off-target tissues. And the novel capsid discovery team does a process that involves iteration. So, there are initial screens, and then there are secondary maturation screens. And what we found is we can identify capsids with increased delivery to the CNS. And then to the maturation process, we can identify variants that have similar or increased delivery to the CNS, and then altered delivery to other tissues. And so we can identify a panel of captured variants, and select those that match our capsid profile for a given disease and attach the profile that Al mentioned earlier is something that we do build for each of the diseases that includes the tissues we want to target and the tissues that we want to avoid for potential off-target risk. And another opportunity side is that we have the potential to deploy TRACER in other tissues as well. And so if we are able to identify capsids that target muscle or other tissues, those present opportunities for licensing with others as well. So, there is a lot of opportunity in the TRACER platform.

Thank you.

[Operator Instructions] Our next question comes from Yanan

Hi. Thanks for taking the questions and congrats on the quarter. So, first a question on SOD1, ALS gene therapy development paths, given the upcoming person at common PDUFA, I am wondering if you could comment on the validity of neurofilament light chain as a surrogate marker for efficacy. And if it turns out that FDA accepts this surrogate marker, do you think that would be the same path for a gene therapy program as well? Thank you.

That’s a great question and something I think we are all tracking. I do believe myself, that neurofilament can be relied upon as a surrogate marker of efficacy. But I am not a regulator. And whether FDA decides that it’s a valid surrogate endpoint for approval, we will find out very soon. Nevertheless, I think we can still use it as a way to decrease risk. And we can use it even in the earliest clinical trials to track whether or not our gene therapy is affecting at least nerve fiber integrity as measured by neurofilament release. So, I think it’s a very useful surrogate marker of efficacy, regardless of what the FDA decision is. The FDA decision if they do use it, or consider it a valid endpoint for approval, that just makes the approval pathway even shorter on behalf of the patients. But in addition to NSL, Biogen has an eye on us have published in the New England Journal that you can look at soluble SOD1 levels itself in the spinal fluid as sort of a target engagement biomarker. And we could do the same thing as well, we should be reducing the expression of SOD1 in spinal fluid. So, both of these measures are very useful to help us understand whether our gene therapy is on the right track, and we plan to use all of it.

Got it. And another question on the collaborating the partnership programs, the licensing with regard to TRACER, to what extent Pfizer and Novartis have studied the TRACER tested in conjunction with their target? Have they conducted any animal studies, for example? And then on Novartis, for the two additional targets that they may decide to pursue with some significant fees? Is there a timeline that when they might, they have to make the decision to go with the option with $18 million for target payment?

Yes. So, this is Allen, I will take the second piece first. So, the ability for Novartis to expand to two additional targets, they have 18 months to decide whether they would like to do that, to choose either to add one or two targets under the agreement. If they do it would be we attract the same terms as the original agreement, which is $18 million per target if they add a target, and then the same $12.5 million per exercise with the $300 million in potential milestones downstream and mid to high-single digit royalties. So, that’s, they have 18 months to make that decision. And I am sorry, what was the – Yanan talk to on this the first part of the question, if you could just repeat that?

Right. So, thanks for those answers. And have these – have Pfizer and Novartis studied the TRACER capsids, together with their specific targets in animal models. So, to what extent have they done the work before they opt into the TRACER capsid?

Right, apologies. So, in each instance, both Pfizer and Novartis had a 1-year period to evaluate whichever of our capsids they wanted to look at, to consider for exercise. So, they conducted their own experiments on their end to help them decide which and whether they would like to exercise on which capsid. So, at the end of that process, Pfizer exercised an option for its neurologic target, and Novartis has just exercised for two of the CNS targets after their own evaluation. There is a subset of information that’s shared back to us that is not intended to be specific to their targets, but to help Voyager understand the results of the experimentation with our capsids in the hands of our partners, so that information is valuable to us as we learn more and more about our own capsids.

Great. Thanks for the color. And lastly, just wondering on the evolution of the TRACER capsids. So first of all, are you conducting additional experiments and having additional efforts for further reducing the capsid load, i.e., with even more potent and more CNS selective TRACER capsids? And when might we have some update on that? And also how about targets outside the CNS, had they – will we hear about some update on that front? Thanks for taking all the questions.

Yes. Hi, this is Todd. So, with regard to non-CNS application, our focus has been on the CNS, that’s where we spend the bulk of our efforts on so far, so I can’t commit to any timelines. It’s certainly something that we are interested in exploring in the non-CNS side. With regard to the continued evolution of our TRACER capsids, that’s absolutely something that we are seriously pursuing to continue to mature our capsids and to develop, the team looks at different loops on the AAV capsid surface. We use different starting capsids, different rental capsids, and all those processes continue. We will be presenting data at the upcoming ASGCT, I think the next conference that we will be showing some new data, and we will continue to share the work that comes out of our TRACER platform as it arises.

Great. Thank you looking forward to the ASGCT presentation. Thanks.

[Operator Instructions] Our next question comes from Jay Olson with Oppenheimer. Your line is open.

So, congrats on all the progress and thank you for taking my questions. Can you talk about how the lessons learned from your SOD1 gene therapy for ALS will inform your early research in siRNA tau. And then since they are interesting CNS targets that could be targeted by siRNA as you optimize gene silencing payloads, what sort of other new research initiatives are you considering? And then I have one follow-on a second, please.

Hi Jay. I will start and Todd will continue. But listen this, I believe this our ability to vectorize siRNA is a huge capability that we have that Voyager honed over the years. It’s not an easy thing to find siRNAs. And we published on some of the thinking that goes into it. How many versions we tested etcetera, and how we address things like over harnessing the potential. And so yes, I mean I think that the siRNA – vectorized siRNA for SOD1, there will be lessons learned there that we will apply to all of our future siRNA programs, including tau. Todd?

So, one of the good things about working here at Voyager is we can deploy different kinds of payloads. This includes the vectorized antibodies that we talked about, the gene replacement, and then the siRNA that we are talking about here. Some of the honing that we did that I mentioned came through our first-generation Huntington’s program. We continue to pursue Huntington’s approach as well. That was an early exploratory program that we announced earlier this year, that’s a dual approach we are looking to knockdown both real specific way, the mutant form of Huntington and MSH3, which is a genetic modifier of Huntington’s disease. So, we had a lot of efforts in the siRNA approach, we have honed that expertise over the years. And we are looking forward to deploying these programs in addition to the other payloads abilities that we have.

Yes. And maybe I could add that the Huntington’s programs is specific siRNA, which is also not straightforward to develop. And Voyager scientists have figured out how to do that. I would also add that if there is a lot of mutations that are toxic gain of function mutations for CNS disorders. So, having this capability of knocking down gene expression is very, very helpful and opens up a large number of targets for us to pursue.

Excellent. It’s very helpful. And then if I can please ask one follow-on with the advancement of your anti-tau antibody, can you just talk about how that will fit in with your siRNA tau gene silencing program, and I guess how the two modalities could be potentially complementary and fit into the future treatment landscape for Alzheimer’s?

Hi, this is Todd again. So, thank you for the questions. We are excited about how the target is neurodegenerative targets go, it’s validated. We think that our antibody approach as we mentioned earlier, the antibody approach against tau came out of vectorized antibody program. And we identified a series of antibodies that worked extremely well and our animal models and are differentiated by both the efficacy in our animal models and the epitope that we target. And so we are continuing to move that forward. That said, there are still other approaches that could be really effective, potentially in telepathy and we think that vectorized siRNA to reduce tau is one of those. So, the reduction of tau intra-cellularly is while, it still affects tau, it’s an independent mechanism of affecting tau than a tau antibody. So, I think those approaches are interesting, and so our approaches, but they are also potentially interesting in combination. And of course, then there is the potential to combine with other Alzheimer’s disease therapies as well, including the anti-amyloid that have recently received accelerated approval. So, I think I would say we are in a bit of a renaissance of neurodegeneration and Alzheimer’s disease, and we are pretty excited about this progress.

Great. Thank you for taking the questions.

And I am not showing any further questions. At this time, I will turn the call back over to Al Sandrock for any closing remarks.

Thank you everyone for joining us today. Please feel free to follow-up with us directly with any other questions. Thanks again. Bye.