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Alexander Macrae

Thank you, Louise, and good afternoon to everyone joining the call. It's only been a couple of months since our fourth quarter call, but I'm pleased to share with you some company progress across a variety of areas, including our capsid engineering platform, our neurology pipeline, our Fabry program and our finances. Beginning with our capsid engineering platform. In April, we announced our third capsid license agreement since we shared the discovery of our industry-leading neurotropic delivery capsid STAC-BBB. We are pleased to sign an agreement with Eli Lilly and Company, granting Lilly a worldwide exclusive license to STAC-BBB for up to 5 potential disease targets of the central nervous system.
We have received the $18 million upfront license fee for the first target and are eligible to earn up to $1.4 billion in additional license target fees and milestone payments across all 5 potential disease targets as well as tiered royalties on potential net sales.
We are thrilled to have signed this third important agreement, further demonstrating that we are a collaborator of choice for neurotrophic capsids. With Genentech, Astellas and now Lilly, we have great partners in neuroscience for our technology, and we continue to engage in discussions with new potential collaborators for STAC-BBB. Turning to our neurology pipeline programs. This quarter, we continue to advance clinical study preparations for ST-503, our investigational epigenetic regulator for the treatment of chronic neuropathic pain. We are preparing for a Phase I/II study to assess the safety, tolerability and preliminary efficacy of a onetime dose of ST-503, our investigational epigenetic regulator that will be administered intrathecally to patients with intractable pain due to idiopathic small fiber neuropathy or ISFN.
We plan to begin patient enrollment and dosing for the ST-503 study in mid-2025 and anticipate having preliminary proof of efficacy data in the fourth quarter of 2026. We also continue to advance clinical trial authorization or CTA enabling activities for ST-506, our epigenetic regulator for the treatment of Prion disease to be delivered intravenously using our own STAC-BBB.
We are extremely proud to have been selected to present during the prestigious Presidential Symposium at this week's ASGCT Annual Meeting in New Orleans. We look forward to showcasing our potent combination of epigenetic regulation and capsid delivery technology in Prion disease and describing the profound survival benefits we observed when administered to post-symptomatic mice. We will also describe the sustained brain-wide suppression of prion protein expression in both mouse and nonhuman primate models, supporting its potential as a onetime therapeutic approach for Prion disease. We plan to begin clinical trial enrollment and dosing for ST-506 in mid-2026 and expect to have preliminary clinical data in the fourth quarter of 2026. In addition to the PM presentation, we have had 8 abstracts accepted by ASGCT.
I am very proud of our scientists and look forward to us showcasing the progression of our neurology pipeline, including advances in zinc finger epigenetic regulation, the latest innovations in capsid delivery engineering and developments in our modular integrase technology. Moving to our late-stage Fabry program.
Last week, we were excited to announce a number of important derisking milestones in the pathway to the anticipated BLA submission for ST-920. All dose patients in the Phase I/II STAAR study have now completed at least 52 weeks of follow-up, a key milestone required by the FDA for an accelerated approval regulatory pathway for ST-920. Importantly, preliminary analysis of the clinical data collected as of this 52-week milestone date across all 32 dose patients indicated that the mean eGFR slope continued to remain positive. The product candidate continues to be well tolerated and a pivotal data readout is now expected by the end of this quarter. Furthermore, in April of this year, Sangamo held a productive Type B meeting with the FDA, providing us with a clear chemistry, manufacturing and controls or CMC pathway to the planned BLA submission.
We were encouraged by the productive nature of the discussions and the engagement from those FDA representatives in attendance and are happy to have clarity on these important activities from the agency.
With the newly agreed CMC pathway, we believe we have a clear line of sight to an anticipated BLA submission as early as the first quarter of 2026, which would facilitate a potential approval and commercial launch of ST-920 as early as the second half of that year. As you can imagine, this clinical and regulatory progress has been well received by our potential commercial partners, and we are hopeful that these derisking events may accelerate our ongoing negotiations. We remain committed to securing an anticipated partnership that is best suited to bring ST-920 to Fabry patients upon potential approval, and that provides near-term capital for Sangamo to advance our core neurology pipeline. As I've said before, in order to execute on our plans and deliver on this promising neurology genomic medicine pipeline, Sangamo must be sufficiently capitalized. We must have the resources to fund us through proof of concept in both our chronic neuropathic pain and prion disease programs while operating a lean, efficient and focused organization.
In support of this strategy, today, we announced the pricing of an equity offering to extend our immediate cash runway. We're optimistic these funds will provide us with the bridge that we believe is necessary to secure a Fabry commercialization agreement. We believe that this modest infusion of equity capital alongside the recent positive Fabry clinical and regulatory derisking events will allow us to secure the right commercial partner for the company and for our shareholders. We also continue to engage in promising business development discussions across our technology platforms. We have opportunities for potential funding through both new and existing STAC-BBB collaboration partners with our zinc finger platform and through collaborative research agreements related to our modular integrase or MINT platform, all of which demonstrate the ongoing interest in our technology.
We look forward to sharing more information when we can. With that overview of our business progress and strategy, I'd now like to hand it over to Prathyusha Duraibabu, our Chief Financial Officer, who will provide more context on long-term vision and financial strategy to support our neurology-focused mission. Prathyusha?

Prathyusha Duraibabu

Thank you, Sandy. I'd like to begin by emphasizing our long-term vision for Sangamo as a neurology-focused genomic medicine company. We strongly believe in the potential of our neurology pipeline to deliver transformational therapies for patients as well as significant value for our shareholders. Our goal is to appropriately fund the company to achieve clinical proof-of-concept data across both our chronic neuropathic pain and prion disease programs. These milestones represent critical potential value inflection points that could significantly change the trajectory of our company.
To achieve these important milestones, we have a financial strategy with both short- and long-term components. In the near term, the equity financing we announced today is necessary to solidify Sangamo's immediate financing needs. We believe the offering proceeds will extend our runway to late in the third quarter of this year.
More importantly, this bridge financing provides us the time we believe that we need to secure the right Fabry commercial partnership, one that would fund our neurology mission in the near term and create value for shareholders over the longer term. We've already made significant progress in transforming our financial profile.
In 2024, we reduced our non-GAAP operating expenses by 50% year-on-year by carefully focusing the organization on our most important priorities. We are leaving no stone unturned in seeking additional cost savings and are looking at ways to further reduce our operating expenses to maximize the efficiency of the go-forward neurology company. We are committed to operating as leanly as possible while continuing to advance our 2 neurology programs at a steady pace. We believe this disciplined approach to capital allocation will ensure that we have the specific talent and capabilities to execute on our neurology mission while extending our runway through our key value-creating milestones. I'll now hand it back to Sandy for closing remarks.

Alexander Macrae

Thank you, Prathyusha. I'm pleased with the progress we have made this year so far. We signed our third STAC-BBB license agreement this time with Lilly, reinforcing that Sangamo is a collaborator of choice for neurotrophic capsids. We continue to advance our ST-503 program for the treatment of intractal pain due to ISFN ahead of the start of a planned patient enrollment and dosing in mid-2025. We achieved significant clinical and CMC derisking milestones in our pathway to anticipated BLA submission for our Fabry disease program, and we have advanced multiple potential business development discussions across a range of Sangamo technologies, including STAC-BBB, our zinc finger platform and our MINT platform, while securing additional capital to support our near-term efforts.
We remain resolutely focused on solving our long-term funding needs and partnering our Fabry disease program in an effort to provide sustainable and long-term funding for our promising neurology genomic medicine pipeline.
In closing, I would encourage you to engage with the data we'll be presenting at this week's ASGCT Annual Meeting, which will be made available on the Sangamo website once data embargoes have lifted. These presentations will further demonstrate the scientific foundation of our pipeline and the potential of our therapeutic approach to address significant unmet medical needs. As always, we thank you for your continued support of Sangamo. Operator, please open the line for questions.

Question and Answer Session

Operator

Maury Raycroft, Jefferies.

This is James on for Maury. Congrats on the progress. Just to start off, could you provide more color on what exactly you plan to show in the top line eGFR data? Do you plan to show just the eGFR slope or there be other quality of life endpoints? Also, do you plan to show an NHS analysis to contextualize the improvements you're seeing in eGFR?
And if so, can you provide some color on the statistical plan and p-value threshold?

Alexander Macrae

Thank you for your questions. Nathalie, can you talk to these?

Nathalie Dubois-Stringfellow

Yes. Yes. So we're really happy to have dosed all the patients and now have passed the 1-year milestone required by the FDA for an accelerated approval regulatory pathway. We will, of course, share in the top line data the updated mean eGFR slope, and we will comment on additional information at a later date.

It's fair to say, Nathalie, that at that time, we'll also have 19 patients who will have achieved 2 years data. Absolutely. So it really is a robust data set. We understand the excitement people have to see this data in full, and we will show as much as possible as we can of the top line data as we prepare it for the BLA submission.

Nathalie Dubois-Stringfellow

Yes. And as to the statistical analysis, we are not commenting at this time, but we have I agree with the FDA on our Type B meeting with them. So we feel like we -- it's a standard way to doing it and have agreed with the FDA on the path forward.

Got it. And just one really quick follow-up. Now that you're sort of in the final stages of securing a potential SAR partnership, how many partners are you -- potential partners are you currently in conversations? And what can you really tell us about those ongoing discussions at this point?

Alexander Macrae

You can imagine that that's not something that we're able to comment. But it's fair to say there are multiple potential partners that we're talking to. And I think for all of them, the Type B meeting was very helpful because it gave a clear path for the CMC, which is something that is very important for any gene therapy BLA and approval. So we were very pleased with that result. We're very pleased with how straightforward the interaction with the agency was and how helpful they were because I know for people like you, predictability of the process and the approval process is very important.

Operator

Nicole Germino, Truist.

Nicole Germino

So you previously mentioned potential interesting partners for Fabry and Hem A. Has the pace of those conversations gone? Have they changed in any way given the macro landscape with changes at FDA? And do you see any added pressure around cell and gene therapies in particular?

Alexander Macrae

So Nicole, sorry, your line was quite hard to hear here. I think I heard you ask us to comment on hemophilia A and the agency's attitude to gene therapy. Is that fair?

Nicole Germino

Yes. And Fabry disease.

Alexander Macrae

So as I kind of alluded to in the last answer, the remarkable thing about the agency interaction we just went through was how unremarkable it was and how helpful the agency was. We -- they send you answers to your written questions before the meeting. They came in on time, and they were very detailed. They had the -- all the right people at the most senior level in the meeting.
And we got the answers, the formal minutes of the meeting within a week of the meeting where they could take up to 30 days. And so in every form of interaction we've had, we have found them unchanged in how they are looking at our Fabry disease program. And when we look at the interactions that Pfizer had across the hem A, they also seem to have been very positive about that. So we are not seeing any change. I'm sure, like us, you are very aware of the announcements and the concern about funding and about resourcing at the agency, but we've not seen any evidence of that, and it has not impacted anything to do with our program.

Nicole Germino

Okay. And then one quick question and follow-up. So given the current administration's concern around drug pricing, how do you think that will impact gene therapy uptake and pricing in U.S. and ex U.S.

Alexander Macrae

I think there's a long way to go in those discussions around drug pricing. I think that the pharmaceutical industry is a very important industry in America. And I'm sure as someone who sits on the Board of Bio that Bio will be having very detailed and hopefully productive conversations with the administration to find a good way through this.

Operator

Yanan Zhu, Wells Fargo.

This is (inaudible) on for Yana. Just to clarify on the prior questions. On the regular path for Fabry, do you still plan to file based on 52-week eGFR data? And is static versus baseline required for eGFR?

Nathalie Dubois-Stringfellow

Yes, absolutely. We are absolutely pursuing the agreement we had with the FDA to use 52 weeks eGFR for the entirety of the patient population in the Phase I/II study. We have collected all the data from the 32 patients, and we are seeing it. So we expect to share the top line data at the end of the quarter, and then this will be the basis for the data in our BLA.

Alexander Macrae

And it's very important that we emphasize how much supportive data there is beyond the eGFR. We have got agreement with the agency for submission based on that as the primary endpoint. But I think the thing that convinces the agency and has made this such a compelling medicine for us is that every other indication index of success in the trial is going in the same direction. So pain scores, Fabry scores, SF-36.

Nathalie Dubois-Stringfellow

Yes. And the general safety is very good, very well tolerated. The patient in general, are feeling better and our alpha-Gal level remain high in all patients.

Alexander Macrae

And some of these patients are now out to 4-plus years.

Nathalie Dubois-Stringfellow

4-plus years, yes.

Sorry, maybe you already commented on it. And is static versus baseline required for eGFR?

Alexander Macrae

We'll be looking at a variety of statistical methods to describe the difference in eGFR. But we said last week or the week before in our announcement that the eGFR remains positive. So the slope of the EGR remains positive.

Operator

Luis Santos, H.C. Wainwright.

Luis Santos

Congratulations on the selection of your talk for the presidential symposium and your impressive presence at ASGCT. Regarding Fabry, I don't know if I missed this, but are the patients who were on ERT still all off ERT? Or were there any relapse?

Nathalie Dubois-Stringfellow

Yes. All patients -- the 18 patients that started on ERT out of our 32 patients are still off ERT.

Luis Santos

And for the -- I know that you mentioned you're not commenting so much on the statistical analysis plan, but the eGFR slope, you said it remains positive, but is there any threshold that we should be looking at as a minimum? Or is there any actual statistical significance? I think prior questions were asking about this already, but I'm not sure if I was clear on that.

Nathalie Dubois-Stringfellow

We're not commenting on this right now, but what I can tell you is the mean eGFR slope remains positive.

Alexander Macrae

And you will -- I know you're very aware that in normal people -- sorry, people without Fabry disease, there's a gradual decline over time in their eGFR. In Fabry patients, there is an exaggerated decline in eGFR that is not fully addressed by ERT and it remains negative in patients that are on ERT. And so as part of our analysis, we'll be looking look at the change from baseline, and we'll be looking at compared to the data for other forms of treatment for Fabry disease. We would not have put out the press release that we did about the eGFR remains positive if we weren't confident that the results were what the agency were looking for.

Luis Santos

And that's helpful. Just to wrap up that and clarify my question as well for the statistical analysis plan, even if you're not giving us more detail, you are submitting all the data available from all patients for the BLA submission. But which ones will be used for the -- which ones will be used for the statistical analysis plan? Is it all of them? Or is it just a portion of them?

Prathyusha Duraibabu

It's all of them.

Alexander Macrae

So the submission for the BLA submission will be 32 patients at 1 year and 19 patients at 2 years.

Operator

Luca Issi, RBC Capital Markets.

This is Katy on for Luca, and this will be a question on STAC-BBB. And we recall that Homology Medicines had one of the first capsids delivered systematically, which could cross the blood-brain barrier and demonstrated in a mouse model, a dose-dependent reduction in biomarker both systematically and in the CNS. So would you expect to see a similar dual impact with your STAC-BBB capsid? And also, do you expect similar preconditioning to your other capsid approaches, i.e., no prophylactic steroids? Any color there would be very helpful.

Alexander Macrae

So we can really only comment on our own capsid and its effectiveness. We have not made the decision whether we will use steroid treatment in the clinical trial yet. We're very pleased with the effectiveness of STAC-BBB. We're very pleased to have seen the result in monkeys across with a variety of cargoes. And I would really commend you all to look at the presentation that Brian will be giving at ASGCT, where it really showcases both the effectiveness of STAC-BBB and the importance of the right cargo in it.
And to be honest, that's why it's so pleasing that Lilly, Astellas and Genentech who are all big names in the neuroscience field have chosen to license our capsid directly.

Nathalie Dubois-Stringfellow

Yes. And what we will present really is profound survival benefit of the treatment in disease mouse model and sustained brain-wide suppression of prion protein expression in both mouse and nonhuman primate model, supporting its potential as a onetime therapeutic approach for prion disease. So it's very important that we have tested it in NHP and it's extremely well tolerated.

Alexander Macrae

And the presidential symposium, I think there's 2 presentations being given out of something like 4,000 abstracts that were presented. And it's a great credit to the work of Bryan Zeitler and David Ojala and Victoria and Brian's team that have all done so much work to drive something that hopefully next year will be a potential curative -- sorry, a potential treatment for patients with this awful disease.

Operator

(Operator Instructions)
Gena Wang, Barclays.
I am showing no further questions at this time. And I would like to hand the conference back over to Louise Wilkie for closing remarks.

Louise Wilkie

Thank you once again for joining us and for your questions today. As a reminder, you can access our presentation on the Investor Relations section of the Sangamo website. We look forward to keeping you updated on our future developments. Thank you.

Operator

This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.