Cartesian Therapeutics Inc (RNAC) 2022 Q1 法說會逐字稿

Good morning, and welcome to the Selecta Biosciences First Quarter 2022 Financial Results and Corporate Update Conference Call. (Operator Instructions) This call is being webcast live on the Investors and Media section of Selecta's website at www.selectabio.com, and it is being recorded.

For opening remarks, I would like to introduce Kevin Tan, Chief Financial Officer of Selecta. Please go ahead.

Thank you, and good morning. Welcome to our first quarter 2022 Financial Results and Corporate Update Conference Call. The press release reporting our financial results is available in the Investors and Media section of Selecta's website, worldwide web selectabio.com.

Our quarterly report on Form 10-Q for the quarter ended March 31, 2022, which will be filed today with the Securities and Exchange Commission, or SEC.

Joining me today are Carsten Brunn, 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 and regulatory and clinical progress of our product candidates, 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 quarterly report on Form 10-Q.

You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today, May 5, 2022, and Selecta disclaims any obligation to update such statements even if management's views change.

I would now like to turn the call over to Carsten. Carsten?

Good morning. I appreciate everyone taking the time to join us today. Despite geopolitical turbulence, max economic volatility and sector-specific headwinds, we believe Selecta's proactive approach to managing risk, which included opening additional SEL-212 clinical trial sites in the U.S. in the face of heightened geopolitical instability, prioritizing our product portfolio to manage our resources and raising additional capital ensures that Selecta can build on the exciting progress made in 2021 and realize the full potential of our leading precision immune tolerance platform.

We continue to make steady progress across our proprietary pipeline as well as deliver on several key strategic and financial milestones. Most notably, we recently announced that the clinical hold on SEL-302, our wholly owned gene therapy candidate for methylmalonic acidemia, or MMA, was listed on March 9 and we successfully completed an underwritten offering in April, which raised approximately $38.7 million in gross proceeds.

With a focused wholly owned portfolio and financial run rate into mid-2024, we believe Selecta is well positioned to execute on our clinical stage assets in biologics and gene therapies, advance our proprietary IgG Protease Xork into the clinic, complete our IgA protease clinical candidate selection for our program and accelerated development of ImmTOR-IL, our next-generation, antigen-specific precision immune tolerance platform.

We're incredibly excited to advance our ImmTOR platform and bring hope to the over 24 million Americans suffering from autoimmune diseases daily. Our sharpened strategic approach has allowed us to support and accelerate the development of our wholly owned pipeline with a focus on tolerogenic therapies for autoimmune diseases and therapeutic biologics as well as provide transformative solutions for our gene therapy partners to unlock the true potential of adeno-associated virus or AAV gene therapies.

I would now like to walk you through key updates and recent strategic partnerships pertaining to the 3 pillars of our pipeline.

The current standard of care for autoimmune diseases utilizes immunosuppressive drugs, which are associated with side effects that often leaves patients vulnerable to serious infection and malignancies or treatments that provide only symptomatic relief. Our approach is to reimagine the treatment paradigm for autoimmune disease by using our precision immune tolerance platform to restore natural immune system balance by inducing and expanding antigen-specific regulatory T cells, thus avoiding the need for systemic immunosuppression or chronic symptomatic treatments.

Recent preclinical data generated by our scientific team shows a logistic activity when ImmTOR was combined with engineered IL-2 molecules that are selective for Tregs. This combination, which we call ImmTOR-IL shows a substantial increase in antigen-specific Tregs when co-administered with a target antigen well beyond what we see with ImmTOR alone in which we already have observed clinically meaningful benefits.

We tested ImmTOR-IL for the ability to induce durable immune tolerance to a co-administered AAV gene therapy vector in mice. We observed complete inhibition of anti-AAV antibody formation after multiple doses of gene therapy to 117 days. Most excitingly, this effect was observed and will be considered set therapeutic doses for ImmTOR alone. These results suggest that this combination of a Treg-selective IL-2 with ImmTOR has the potential to increase the potency, durability and efficacy of the antigen-specific immune tolerance that ImmTOR elicits.

Our own programs of engineered Treg-selective IL-2 molecules focus on a generalized expansion of total existing Tregs but not Treg-specific for the autoantigens responsible for the pathogenesis of autoimmune diseases. Thus, we believe ImmTOR-IL has the potential to be a truly differentiated first-in-class antigen-specific immunotherapy for autoimmune disease that restores immune system balance in vivo.

We believe that our ability to induce antigen-specific Tregs in vivo is potentially the most elegant solution to the intractable problem of restoring balance to the immune system. Further, we believe ImmTOR-IL represents a transformative evolution of our precision immune tolerance platform with implications across all 3 pillars of our pipeline. In particular, the potential to create breakthrough therapies for the treatment of autoimmune disease.

A key priority for Selecta in 2022 will be to accelerate development of a proprietary engineered IL-2 molecule. 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 speed the development of a next-generation, highly differentiated IL-2 mutein to combine with ImmTOR.

We believe our ImmTOR platform is ideally suited to address primary biliary cholangitis or PBC, a T cell liver disease driven by a well-defined antigen. In PBC, the immune system mistakenly attacks tissue in the liver and damages the small bile ducts. Treatments to help slow the progression and prevent complication PBC are available. However, these medications ultimately fail to control PBC and patients often require a liver transplant.

As shown in animal models of liver injury inflammation, the ability of ImmTOR to target the liver, coupled with the expansion of antigen-specific Tregs and co-administered with IL-2 suggests that ImmTOR-IL may be beneficial in the treatment of patients with PBC. We are continuing IND-enabling studies for this program.

In parallel, we are evaluating additional targets and indications to be well suited for our first-in-class antigen-specific immunotherapy and will update the market as we add indications to our pipeline in autoimmune disease.

Moving on to our work in gene therapy. We believe Selecta with a combination of ImmTOR and our proprietary IgG Protease Xork has the potential to solve some of the most difficult challenges facing the AAV gene therapy field. Patients who have pre-existing antibodies against the capsids due to prior natural exposure to the AAV virus are often ineligible for treatment.

Additionally, the anti-capsid response prevents the ability to readminister AAV vectors. As a result, gene therapies are considered onetime only treatments. Currently 30% to 70% of the patient population for gene therapy trials are ineligible for inclusion due to preexisting utilizing anti-AAV 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 shown promise as a pretreatment to translate clear preexisting, mutualizing antibodies and create a window during which AAV gene therapies could be administered.

However, IgG proteases are derived from bacteria and are themselves highly immunogenic. Additionally, -- some IgG proteases are derived from a common human pathogen. And consequently, the vast majority of individuals have pre-existing antibodies against these proteases.

Xork, our proprietary IgG protease candidate that is designed to specifically treat human IgG is derived from nonhuman pathogen, and we observe low-cost activity to preexisting IgG protease antibodies.

We believe that the combination of Xork with ImmTOR could enable repeat dosing of this enzyme therapy.

This combination of Xork and ImmTOR has the potential to simultaneously address 2 of the biggest issues currently limiting AAV gene therapy. Xork to bring the power of gene therapies to those patients who would be otherwise ineligible for treatment due to preexisting antibodies and ImmTOR to mitigate the no immune responses to AAV gene therapy and enable redosing.

We believe that the combination of Xork and ImmTOR has the potential to provide safer and more effective gene therapies to more patients and truly unlock the potential of the gene therapy modality by transforming a treatment into a durable, long-term cure.

Preclinical studies suggest multi potential benefits of ImmTOR in AAV gene therapy, including increased transient expression in the first dose, mitigation of hepatic inflammation, more durable transient expression and inhibition of capsid-specific B and T cell responses. We are proud to have multi presentations, both independently and in partnership with AskBio at the upcoming Annual Meeting of the American Society of Gene and Cell Therapy or ASGCT this month.

Our presentations will highlight the ability of ImmTOR and ImmTOR-IL to mitigate anti-AAV antibodies and enable repeat vector dosing.

In a single dose clinical study in healthy human volunteers conducted in partnership with AskBio, we observed the ability of ImmTOR to mitigate the formation of anti-AAV antibodies out to 30 days, and our preclinical data in mice and nonhuman primates suggest that control of antibodies can be maintained with 2 additional doses of ImmTOR.

Another major challenge for the gene therapy field relates to the serious toxicities associated with vector doses of 1E14 vg per kgs or higher. Solving this problem will likely require a multipronged approach including engineering more efficient capsids. The ability to redose AAV vectors could provide a complementary strategy by enabling the administration of multiple lower doses of capsids. We would like to see the dosing paradigm for AAV gene therapy change from one-and-done to low and slow.

By giving multiple lower doses of the gene therapy we could potentially titrate up to the intended therapeutic level while avoiding the unfortunate adverse events that have been seen at high doses of gene therapies. Initial studies in mice suggest that ImmTOR-IL has the potential to mitigate vg anti-AAV antibody responses at high vector doses up to 5e13 vg per kgs.

We're also excited about our collaboration with Ginkgo Bioworks to design novel AAV capsids with a goal of improving transduction efficiency, liver tropism and immunogenicity profile. Ginkgo will design and engineer the capsids and Selecta will conduct all nonclinical and clinical studies thereafter. This partnership leverages Ginkgo cell engineering and high throughput screening capabilities and Selecta's ImmTOR, precision immune tolerance platform to advance gene therapy delivery.

By combining ImmTOR, with more efficient capsids, we could potentially reduce the dose of gene therapy needed to see a therapeutic benefit and further mitigate the risk of serious adverse events associated with high vector doses.

Moving on to our wholly owned gene therapy asset, SEL-302. On March 9, the FDA cleared the IND application for our Phase I gene therapy clinical trial of SEL-302, a combination of ImmTOR with MMA-101 being developed for the treatment of MMA, a rare metabolic disease in which the body cannot break down certain proteins and fats. The trial is expected to initiate in the second half of 2022 and will evaluate the safety and efficacy of SEL-302 and the mitigation of utilizing antibodies against the MMA-101 AAV capsid.

We are hopeful that the Phase I trial of SEL-302 will build on the growing body of evidence supporting the potentially multifaceted benefits of ImmTOR for enhancing the efficacy and safety of AAV gene therapies and the learnings from our empty AAV8 capsid study in healthy volunteers.

We believe development of our wholly owned asset in MMA will provide an important regulatory and clinical blueprint for our leading gene therapy partners, including Takeda, Sarepta and AskBio.

We are seeing excellent progress across our gene therapy platform, and we look forward to continuing to progress ImmTOR in our wholly owned gene therapy programs. To maximize the full potential of our platform, we plan to actively pursue business development and out-licensing opportunities for both ImmTOR and Xork for gene therapy applications.

Lastly, I want to provide an update on the biologics pipeline which houses our most mature program. SEL-212 has served as an important clinical validation for our precision immune tolerance platform with over 450 patients dosed to date.

Many biologics can be highly immunogenic, resulting in suboptimal responses due to the development of antidrug antibodies after multiple treatments. Patient that develop an immune response may be forced to discontinue treatment or experience adverse reactions. We believe that the use of ImmTOR as adjunct to biologics offers a promising approach to minimize the health care and economic burden of antidrug antibodies.

SEL-212 is comprised of ImmTOR, co-administered with a proprietary uricase, pegadricase for the treatment of chronic refractory gout and was licensed to Swedish Orphan Biovitrum or Sobi, in 2020. As a reminder, our Phase III DISSOLVE clinical program kicked off in the third quarter of 2020 and consists of 2 double-blind placebo-controlled trials of SEL-212.

In both trials, SEL-212 will be evaluated at 2 doses of ImmTOR, 0.1 mgs per kg and 0.15 mgs per kg and 1 dose of pegadricase, 0.2 mgs per kg.

The original enrollment target for both studies was 105 subjects. On December 1, 2021, we closed enrollment in 112 subjects for the DISSOLVE I, which is being conducted in the United States.

DISSOLVE II enrollment is continuing at pace and is being conducted in 4 countries across Eastern Europe and the United States. We have proactively undertaken steps to prioritize the safety of our patients and investigators as well as mitigate any potential disruptions due to the evolving geopolitical situation in Ukraine and Russia.

Firstly, we have temporarily suspended screening and randomization for new patients in both Russia and Ukraine and have reserved existing clinical trial supplies in these countries for those already enrolled in the study.

Secondly, to mitigate the risk of any delays, which were actively added 11 additional sites in the United States to offset the potential loss of subjects in Ukraine and Russia and speed enrollment in DISSOLVE II. We now have 55 active sites and are on track to complete the study in Q4 2022.

Finally, in agreement with our partner, Sobi, we have increased enrollment in DISSOLVE II to approximately 140 subjects in an effort to replace subjects enrolled in Russia and Ukraine, who may be lost to operational issues. We anticipate that these mitigation efforts will see us complete both DISSOLVE studies in Q4 2022 with joint top line data available in Q1 2023.

We will continue to work closely with our partner, Sobi, our clinical trial providers and regulatory authorities to ensure the successful completion of the DISSOLVE program.

With extensive clinical data and SEL-212 currently in Phase III, we believe our biologics pipeline is mechanistically derisked and Selecta is well positioned to leverage these learnings into our second biologic indication 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 IgA-protein deposits the underlying pathophysiology of the disease. We believe our novel approach, which combines ImmTOR with IgA1 protease has the potential to remove injurious IgA from the kidneys, improve markers of renal dysfunction and have a transformative impact on patients' lives.

We're currently working with IGAN Biosciences on the first-generation IgA protease derived from the haemophilus influenzae bacteria. Additionally, in October 2021, we entered the collaboration with Ginkgo Bioworks to generate a second-generation IgA protease designed to have lower immunogenicity and when combined with ImmTOR have a potentially transformative therapeutic profile. We plan to finalize clinical candidate selection by the end of the year.

We're extremely excited about the advancements across all 3 pillars of our pipeline and the value-driving milestones ahead.

With that, I will turn the call over to Kevin to run through our financial results for the first quarter ended March 31, 2022. Kevin?

Thank you, Carsten. During the first quarter, we proactively took several steps to further bolster our balance sheet. We prioritized our wholly owned portfolio to conserve resources, restructured our loan agreement to defer principal payments for an additional 12 months. And most notably, on April 6, we priced an underwritten equity offering, raising approximately $38.7 million before fees and expenses.

As a result of these initiatives, we announced approximately $154 million in cash, cash equivalents, investments and restricted cash on hand as of April 11, 2022. We believe our current liquidity will be sufficient to meet our operating requirements into mid-2024.

Selecta enters the second quarter of 2022 with a strengthened cash balance that we believe will allow us to execute on our priorities despite geopolitical uncertainty, macroeconomic volatility and biotechnology-specific headwinds. We have multiple clinical readouts and IND filings anticipated within our cash runway. And we will continue to be careful stewards of stockholders' capital to and execute our strategic plans expeditiously.

Reviewing our financial results in the quarter ended March 31, 2022. Net cash used in operating activities was $11.9 million for the first quarter of 2022 as compared to $12.1 million in the same period in 2021.

Collaboration and license revenue recognized was $34 million for the first quarter of 2022 as compared to $11.1 million for the same period in 2021. Revenue was primarily driven by the shipment of clinical supply and the reimbursement costs incurred for the Phase III DISSOLVE clinical program under the license agreement with Sobi.

Research and development expenses were $17.7 million for the first quarter of 2022 as compared to $13 million for the same period 2021. The increase in cost was primarily the result of expenses incurred for the preclinical programs, salaries, contract license and milestone payments.

General and administrative expenses were $5.5 million for the first quarter of 2022 as compared to $5.2 million for the same period in 2021. The increase in cost was primarily the result of an increase in stock compensation expense.

For the first quarter of 2022, Selecta reported net income of $28.8 million or basic net income per share of $0.23 compared to a net loss of $24.6 million or $0.22 per share for the same period in 2021.

I will now turn it back to Carsten for closing remarks. Carsten?

Thank you, Kevin. In summary, we're pleased with the progress in Q1 2022. With the financial runway into mid-2024, we believe Selecta is positioned to reach potentially transformation inflection points across all 3 pillars of our pipeline.

Most notably, we are excited by our plans to enter the clinic with SEL-302, complete the DISSOLVE program with our partner, Sobi, advance IND-enabling studies across our wholly owned pipeline, support our numerous collaboration partners and rapidly progress our next-generation precision immune tolerance technology ImmTOR-IL into the clinic.

We believe ImmTOR-IL could represent a generational leap forward for the ImmTOR platform. The strong strategic effects we've seen in our preclinical work support our belief that ImmTOR-IL has the potential to unlock first-in-class antigen-specific immunotherapies for autoimmune disease as well as improve the efficacy and safety profile of therapies in biologics and gene therapy.

We will continue to deliver on our unrelenting commitment to solving the hardest challenges in autoimmune disease and help patients overcome autoimmunity and immunogenicity through our evolving ImmTOR precision tolerance platform.

Before we conclude today's call, I would also like to thank the entire Selecta team, our investors and the many people who have been supportive along the way, including our patients and their families.

With that, we're happy to take questions.

(Operator Instructions) Our first question will come from John Newman with Canaccord.

I had a question about the work you're doing with IL-2, really interesting here. What I'm wondering is, you've got a proprietary IL-2 program running here with Cyrus. I'm wondering when you take ImmTOR into the clinic in combination with IL-2, do you think you'll be taking it into the clinic with your proprietary IL-2? Or might you investigate ImmTOR on its own first with an available formulation?

John, it's a good question. So as you rightly said, we are working with Cyrus to develop a proprietary IL-2 mutein and plan to take it into the clinic with that IL-2. Having said that, I mean, there are other IL-2s in clinical development. And there's always a chance to look at those as well. But for now, the plan is to take the combination with the IL-2 from Cyrus into the clinic first.

We believe that the data we have at least demonstrated so far, combining ImmTOR with IL-2 in the mouse studies where we see really a profound increase both an induction and expansion of Tregs will be really meaningful in autoimmune disease.

The other piece, which we're excited about is that this not only limits us to autoimmune disease, but we're also really encouraged by the data we have seen in gene therapy, where the combination actually was dose sparing, which is very encouraging. We also see a potential application combining with biologics as well.

Okay. Great. And I just had one additional question, if I may. You've also got some interesting work going on with your IgG protease. And I know that this is a bit early, but just curious as to how you might like to study that in the clinic once you get there? Just wondering if you'd look at antibodies against gene therapy vectors or if there are some other things that you'd like to evaluate that you think would be more meaningful.

Yes, that's a great question. And I'll let Peter answer this, but just to kind of frame it up for everyone. So our proprietary IgG protease is from a nonhuman pathogen. So that we haven't seen any cross [cleaves] human sera, which we believe is a major advantage. And there are multiple applications, but the one we're most excited about is as a pretreatment for patients that had a prior AAV infection are not eligible for gene therapy.

And Peter, maybe you can elaborate, well, we haven't really guided the detail, but how we might look at this from a proof of concept.

Yes. Thank you, Carsten. The ability to test the IgG protease in healthy volunteers, we think, is a real advantage because there is an incidence of AAV antibodies in the population. So we think that we would start with a healthy volunteer study to look at the aggregation of AAV antibodies in that population. That would step up the potential from looking at multiple different gene therapies with pretreatment with Xork. So we think that the initial clinical development is relatively straightforward in that way.

Of course, then we are looking for either with our proprietary MMA program or OTCD potentially. We're looking for -- or other programs looking for those programs where we could then test it clinically with a specific gene therapy. But the first relatively straightforward approach is to look at (inaudible) of antibodies.

Our next question will come from Rick Miller with Cantor Fitzgerald.

This is actually Kristen. Sorry about that. I wanted to ask, just based on the abstracts that were published for the ASGCT conference earlier this week. And I know the presentations are very near term here. But could you talk about, from a high level, the questions you're looking to really answer with some of these studies that you haven't reported on yet. And it looks like you had some promising effects on inhibiting AAVrh32 IgG antibodies versus methotrexate. And you're looking at different capsids and routes of administration. So essentially, how might some of these studies that you plan on presenting on help shape future directions of ImmTOR for gene therapy, either by you or a partner?

Yes. Kristen, that's a great question. And actually, I'll let the man who actually conducted the study speak to it since we have Kei on the call. Kei?

Kristen, yes, we have a lot of really interesting presentations at ASGCT, both our own and also ones that we are presenting with our partner, AskBio.

So the study you referred to with the AAVrh32.33 capsid was actually being presented by our colleagues at AskBio. And it's a very interesting study because although in humans, it's often seen that you get this increase in capsid-specific CD8 T cells that hasn't been so much noted in animal models. But with the exception of this one capsid, which has been previously published by the Wilson Group to induce capsid-specific CD8s.

So in this study, the AskBio Group used ImmTOR and also compared it to a multi-dose regimen of methotrexate. And the results are really pretty impressive that ImmTOR inhibited capsid-specific CD8 T cells as well as the anti-AAV antibodies as expected whereas methotrexate really had pretty marginal effects.

The other abstracts that were presenting related to kind of getting to being able to redose AAV. So as you know, we had the human's healthy volunteer study that we also did with AskBio. And we have previously reported on that and the finding that we could inhibit neutralizing antibodies out to 30 days with ImmTOR -- with a single dose of ImmTOR in healthy volunteers. And our preclinical studies in both mice and nonhuman primates indicate that by giving additional monthly doses of ImmTOR, we can sustain that inhibition.

In addition, as Carsten was alluding to earlier, I think one of the aspirations that we have, and I think really the whole field is mitigation of these high dose vector toxicities. And of course, one aspect is to engineer more efficient capsid or transgene cassettes. And certainly, we're working with our partner, Ginkgo on better capsids. But we also feel like by changing the paradigm from dosing one-and-done to being able to do multiple doses are slow and low would be a significant benefit.

So instead of giving one large vector dose, if we could give multiple smaller doses. So we present in 2 different posters, one combining ImmTOR with IL-2, so ImmTOR-IL. And the second combining ImmTOR with an anti [drug] agent. We show that we can inhibit antibody formation to capsid doses as high as 5 x 10 to 13 vg per kg.

And to our knowledge, no one has been able to mitigate antibody formation at such high vector doses.

Okay. Looking forward to the presentations in a couple of weeks here. And then just on ImmTOR-IL, I know you're doing a lot of work here and you're extremely excited about the potential. But could you maybe share for us some of the work you're doing to at least narrow down some of the potential indications you might look to start with here?

Yes, that's a great question. So we actually have started with an area we know really well, which is in gene therapy, and that's what Kei just referenced. We're extremely excited results we see there.

We have guided to PBC as our lead indication, but we are working through a process right now to identify additional indications that have Treg-mediated -- or we're looking at this both from a scientific perspective, where you have a high chance of technical success. Looking at available data, I mean there is some data available already from Phase I and some Phase II from other companies that pursue IL-2s in autoimmune disease. That definitely helps to guide as well. And we'll likely guide to another indication this year or a range of indications that we might potentially pursue.

So it's really a combination of what's a good proof of concept, where there's clear biomarkers, we think there's a high chance of technical success, balance with commercial potential, of course, as well. So I think that's kind of where we are right now.

We are conducting additional studies right now in animal models, in autoimmune disease, which are always a bit lengthier and you can expect for us to share some of those data as they come in.

Our next question will come from Yun Zhong with BTIG.

So it's a follow-up question about ImmTOR-IL. It's a very interesting data, and you show there seems to be a big difference between the combination and ImmTOR alone. And also, you said you are going to explore potential use in gene therapy as well, not just autoimmune disease. But I guess you're not going to use ImmTOR-IL in the planned MMA study. And at what point and which way do you think you will be introducing ImmTOR-IL into gene therapy programs? And is that going to be more likely your own gene therapy program or more for potential partnership discussions?

That's a great question. So as you know, ImmTOR alone induces antigen-specific Tregs, whereas IL-2s alone only expand pre-existing Tregs and really the combination you get the best of both worlds. So you get induction and expansion of antigen-specific Tregs, which really is differentiated.

We see the -- really the main application in autoimmune disease, we really want to tip the balance between T effector cells and Tregs, and that's what we're really excited about. But you're right, we're also seeing this being used in gene therapy, but we will not at least initially include this in MMA. I mean in the MMA program, we are testing ImmTOR based on the pretty compelling data we have generated in the anti-capsid study.

I mean there's always a chance to amend this IND and add into IL down the line. But at least for now, we're really focused on getting the study started in the second half of this year. But it's definitely something that we continue to explore further to really fine-tune the treatment paradigm in gene therapy.

Then a quick follow-up, if I may. So you mentioned the next-generation IL-2 in the press release and was that next generation, are you able to comment what exactly are you trying to achieve or -- and what kind of improvement as compared to the current version?

Yes. So we haven't exactly guided to our approach, but I think we've been pretty clear, we're working with a leading protein engineering company, Cyrus, they've come out of David Baker's lab in Seattle.

And obviously, we're trying to optimize the Tregs specific component and not have any effects on T effector cells. And there are multiple approaches. If you look at the IL-2 field, from fusion proteins, muteins, there's various approach, but we haven't guided the approach that we are taking for this program.

Our next question will come from Raju Prasad with William Blair.

Just curious to know, kind of in your conversations with KOLs on the gene therapy side, with ASGCT coming up what the -- the duration of effect to kind of -- is for gene therapy and kind of the use of ImmTOR in the clinical setting.

Yes, that's a great question. And obviously, if you look at the data we have generated so far is that in the human proof-of-concept study with a single dose of ImmTOR we're able to control NAb titers at day 30. We know from the animal studies that ImmTOR extends to half-life of 80 capsids. So we see a rebound of the titers out to day 90, which is expected.

We've seen this in nonhuman primates, but we've also shown that once you control titers at day 30 to give 2 additional doses, actually, you are able to control the titers long term. And we also believe that after day 90, there's no more capsid around, so no more antigen.

So our hypothesis and speaking with KOLs, but also the FDA, we believe that 3 monthly doses actually is a reasonable path to go, and that's how we approach it in our MMA program, where we plan to give 3 monthly doses of ImmTOR.

Great. And can you give us some color or context on the PBC model preclinically and how well that mimics the immune features of the disease and when we can expect data?

Was it PBC?

Yes.

Yes. Okay. Yes, I'll let Kei speak about the model. Kei, you're mute.

Sorry about that. Yes, there's actually a couple of interesting models for PBC in that these are genetic models. So the disease is spontaneous. So you don't have to induce disease in these animals.

So we think it's a more accurate reflection of natural disease and certainly, they're pretty well established in this field.

Our next question will come from Mr. Uy Ear with Mizuho.

I guess my first question is on SEL-212. Just wondering if you need to consult with the FDA to increase the number of patients? And if that's the case, whether you have done so.

And I guess my second question is sort of jumping ahead a little bit. Regarding the gene therapy Phase I MMA study, just wondering about how you will disclose the data. Will you do it either by patients, by cohort, or wait until the study completes?

Thanks for your questions. I'll give the first question to Peter around how we handle the increase of number of patients.

Could you please repeat your question?

Sure. Just wanted to know whether you need to consult with the FDA to increase the number of patients in the Phase III gout study? And if you have, whether you have done so? And if I may, can I also add the top line data is now pushed out to first quarter of 2023. And just wondering if that's something result of the additional patients and additional clinical sites or is there something else as well?

Yes, sure. We did consult with the FDA on the changes that we made to the protocol as well as we will handle the data from Russia and Ukraine.

So we're continuing discussion with the FDA, but the increase to 140 subjects as is underway.

The issue of the reporting in Q1 of both trials is related to the increase in the number of subjects to the trial. And as we report, we'll complete both trials this year, meaning last patient, last visit will be completed this year.

But because it will be at the end of the year, it will take a couple of months to lock the data in.

Thanks, Peter. And then your second question around MMA. We will likely report patient by patient as we get results. We get the first results basically 90 days after we dose the first patient. So we'll likely report it patient-by-patient basis as the data comes.

(Operator Instructions) Our next question will come from Boobalan Pachaiyappan with H.C. Wainwright.

Can you hear me okay?

Yes.

All right. Great. So a couple of questions from our side. Firstly, with respect to MMA Phase I trial (inaudible) so do you plan to include patients with isolated MMA only or both with MMA plus high homocysteine levels. And what would be your rationale for that?

I'll give this question to Peter.

Yes. All the subjects in the trial will have new -- no mutations, and they have clinically severe disease.

Okay. So secondly, with respect to your DISSOLVE data release, so your previous guidance for the top line was fourth quarter 2022. And for today's release, it's actually pushed to first quarter 2023. So just curious, is there an advantage of combining the data from both the trials and releasing it in first quarter 2023 versus releasing the DISSOLVE 1 data in fourth quarter 2022, given that DISSOLVE 1 enrollment was completed last year.

Yes, it's a good question. I mean, as we have decided -- so first of all, the good news is that we have clarity now on the timing. So -- and we've decided to increase the patient numbers to up to 140 in DISSOLVE II. Both studies will read out in -- by the end of this year in Q4, then we decided to do a joint release because they're so close together, it is cleaner to report both pivotal studies at the same time.

Okay. And obviously, ImmTOR-IL is pretty interesting. I think you have been hearing this a lot today. Just curious, can you comment on -- or what kind of safety and tolerability characteristics you're looking for before initiation of your Phase I?

Yes. I think, obviously, we have a pretty good understanding of the safety and tolerability of ImmTOR. I mentioned it in the main call, over 450 patients dosed. We'll obviously do tox studies with our partner IL-2, but we see some indications from the Phase I, Phase II studies of the other IL-2 molecules, which look pretty promising as well.

Our next question will come from Chang Liu with Needham.

This is Chang for Gil. Our first question is, is there any near-term update or potential milestone from Selecta's partners?

Yes, good question. We get a lot. We do have multiple partnerships. It's always difficult to guide. But obviously, we've publicly disclosed that we are eligible to receive milestones of up to $80 million around clinical and regulatory milestones from our partner, Sobi. We haven't disclosed the exact timing, but obviously, it's an important milestones coming up.

We also have guided that Sarepta, their auction period basically expires in June of this year. And there's basically 3 scenarios. One is they opt in. We have a fully negotiated commercial term sheet. The second is, they discontinue the work but there's also an option for them to extend the option period versus a prenegotiated payment.

And it's -- there's potential other milestones, and it's very difficult to guide as they come in. But I think what's important to note as well is that our cash guidance into mid-'24 doesn't include any of the milestone payments from any of the partnerships.

So our second question is, so considering the higher activity of ImmTOR-IL. So is there any logic of moving forward with ImmTOR in earlier programs such as autoimmune diseases like PBC or IgA nephropathy.

Yes, that's a great question. I think what's important is that we see very good clinical activity within ImmTOR alone. I think that's very important. But we're clearly, especially in autoimmune disease are especially excited about ImmTOR-IL in the context where you have to in autoimmune diseases, restore balance between T effector and Tregs. And we believe that ImmTOR-IL is ideally similar to that.

But we stay focused on the programs, we use ImmTOR-IL, such as SEL-212 and MMA. But for autoimmune disease, specifically PBC, we will likely take ImmTOR-IL into the clinic in that indication.

This concludes our question-and-answer session. I would like to turn the conference back over to Carsten Brunn for any closing remarks.

Yes. Thank you, operator, and thank you to everyone who joined us this morning. Stay safe and healthy, and this concludes today's call. Thank you.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.