Sarepta Therapeutics, Inc. Q1 FY2023 Earnings Call

Good afternoon and welcome to the Sarepta Therapeutics First Quarter 2023 Earnings Call. At this time all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. As a reminder, today's program is being recorded. At this time, I will turn the call over to Mary Jenkins, Associate Director, Investor Relations. Please go ahead.

Thank you, Shannon, and thank you all for joining today's call. Earlier this afternoon, we released our financial results for the first quarter 2023. The press release is available on our website at sarepta.com, and our 10-Q was filed with the Securities and Exchange Commission this afternoon. Joining us on the call today are Doug Ingram, Ian Estepan, Dallan Murray, and Dr. Louise Rodino-Klapac. After our formal remarks, we'll open the call for Q&A. I'd like to note that during this call, we will be making a number of forward-looking statements. Please take a moment to review our slide on the webcast, which contains our forward-looking statements. These forward-looking statements involve risks and uncertainties, many of which are beyond Sarepta's control. Actual results could materially differ from these forward-looking statements. And any such risks can materially and adversely affect the business, the results of operations, and trading prices for Sarepta's common stock. For a detailed description of applicable risks and uncertainties, we encourage you to review the company's most recent quarterly report on Form 10-Q filed with the SEC as well as the company's other SEC filings. The company does not undertake any obligation to publicly update its forward-looking statements, including any financial projections provided today, based on subsequent events or circumstances. I'll now turn the call over to President and CEO, Doug Ingram, who will provide an overview of our recent progress.

Thank you, Mary. Good afternoon and thank you for joining Sarepta Therapeutics' first quarter 2023 financial results conference call. Perhaps you'll see this as a break from the past, but I intend to keep my remarks this evening brief. As you know, in a mere 10 days from now, we will be attending and presenting at the FDA advisory panel for SRP-9001 our gene therapy intended for the treatment of Duchenne muscular dystrophy. We believe that the primary areas of discussion at the advisory committee will be these whether the totality of evidence supports the conclusion that SRP-9001 dystrophin protein at the levels expressed by this therapy is reasonably likely to predict clinical benefits. The totality of the evidence will include natural history, the preclinical data, biomarker results, and the functional results from our clinical trials. The panel will also address the risk-benefit analysis associated with the administration of SRP-9001 for the treatment of ambulatory patients with DMD in the context of Accelerated Approval. Finally, there will be an assessment of the ability to bring to conclusion, EMBARK, or Study 301, the proposed post-marketing confirmatory trials to support the Accelerated Approval of SRP-9001 in the event that Accelerated Approval is granted. The team is well prepared and excited to share with the advisory committee the wealth of compelling evidence supporting the conclusion that SRP-9001 dystrophin protein in the amounts expressed by that therapy is reasonably likely to predict a clinical event. To set expectations for this call, we intend to discuss first quarter performance and Dr. Louise Rodino-Klapac will provide a pipeline update, but to respect the process and in light of how soon the meeting will take place, we will not discuss or entertain questions on regulatory matters pertaining to SRP-9001 or the upcoming advisory committee meeting until it's concluded on May 12th. Moving now to the quarter, I am very pleased to announce another strong quarter of performance. First quarter total revenue came in at $253.5 million. Net product revenue came in at $231.5 million, a 23% increase over the same quarter of the prior year and exceeding analyst consensus. This very patient-oriented execution is what we intend to apply to SRP-9001 if approved. We continue to progress our important post-marketing commitments for our three approved PMO therapies. We have already completed 11 of our post-marketing commitments with respect to ESSENCE, which is our two-year blinded placebo-controlled study for VYONDYS and AMONDYS. We were fully enrolled last year and that trial is proceeding with respect to our dose-ranging post-marketing commitment for EXONDYS. Part II of that study is substantially enrolled and progressing. As it relates to SRP-9001, in addition to preparing for the May 12th advisory committee and prosecuting the BLA with the May 29 PDUFA date in mind, we are ensuring that we are prepared to successfully launch 9001 and serve the community if and when approved. By now, we have successfully concluded all FDA inspections including three GMP inspections and two GCP inspections. With our partner Catalent, we are producing material to successfully launch 9001 upon approval and we are finalizing our launch readiness work. We are also finalizing our plans to commence the studies necessary to expand the 9001 label to the broadest population supported by the science, including our commencement of our non-ambulatory study ENVISION, or Study 303, and our multiple studies to explore the removal of neutralizing antibodies to rh74. Beyond that, we've been advancing our broader pipeline that Dr. Rodino-Klapac will provide an update on shortly. The coming weeks and months are monumentally important to the patients that we serve. As I have said many times, we stand at a bellwether moment with the greatest evidence-based hope yet in history to bring a better life to families living with and unfortunately dying from Duchenne muscular dystrophy. We are also well aware that this BLA stands as a bellwether test for gene therapy itself and for the ability to effectively lean in and use available tools to translate groundbreaking genetic science into medicine that can extend and improve patients' lives now, not merely at some theoretical point in the future. We feel an enormous obligation to the patients that we serve and every decision and action is taken with that obligation front of mind. With that, let me turn the call over to our Head of R&D and Chief Scientific Officer, Dr. Louise Rodino-Klapac.

Thanks, Doug. And good afternoon. As we look forward to the weeks and months ahead, we remain resolute in our conviction and our values to follow the science and present the objective evidence to support SRP-9001’s ability to change the trajectory of Duchenne muscular dystrophy. Our goal with SRP-9001 is to alter the course of the fatal disease by treating the underlying cause of Duchenne with a one-time gene therapy that delivers functional dystrophin to the muscle. Sarepta has generated the most compelling preclinical, biomarker, and clinical functional results to date, more than any other gene therapy in development. We've been able to demonstrate that based on the strong scientific underpinning of our construct, early SRP-9001 data provided read-through for our positive clinical experience with the therapy. After years of research, we identified an optimal gene cassette able to retain the most critical, protective, and functional elements and fit inside AAV, thereby enabling its delivery. This gene cassette was packaged into our AAV of choice rh.74, and we chose MHCK7 as our promoter. The early data showed robust expressions across skeletal, diaphragm, and cardiac muscles. As a result of that expression, alongside the dystrophin protein demonstrating functional benefits, we observed a clinical benefit at the target dose in patients with Duchenne. I will explain in a bit more detail. Individuals with Duchenne don't have a functioning dystrophin-associated protein complex (DAPC). Understanding this, when we inserted a functional dystrophin protein, we observed an almost one-for-one up-regulation of the DAPC in animal models. More specifically, we noted a significant reduction in creatine kinase (CK), which is an enzyme associated with muscle damage. This reduction in CK provided further proof that SRP-9001 was reasonably likely to predict clinical benefit. Since 2018 and across multiple studies, we have dosed the largest number of Duchenne patients, more than any other gene therapy in development for this disease. The clinical results have surpassed our expectations. In summary, SRP-9001 demonstrated robust expression of dystrophin far above what literature would suggest is necessary to be protective of the muscle. All of it is properly localized at the muscle membrane or sarcolemma, acting as a shock absorber. We developed a cell-based potency assay that shows that SRP-9001 is active, functional, and protective at the muscle membrane. In animal models with robust expression of SRP-9001, there is a significant reduction of CK. Finally, expression of SRP-9001 in patients leads to upregulation of DAPC. In addition to all of this compelling evidence, we are able to show functional benefits versus what natural history would predict on NSAA or the North Star Ambulatory Assessment, which is our primary functional endpoint. We observed benefits across one-, two-, and four-year time points. Based on the totality of the data, we believe that SRP-9001 qualifies as a disease-modifying agent as the levels of dystrophin expressed are reasonably likely to predict clinical benefit in patients with Duchenne. Now moving to limb-girdle muscular dystrophy or LGMD, we remain committed to advancing our LGMD portfolio through the process of various subtypes. I look forward to providing updates on these important programs in the months ahead. Currently, we are making excellent progress on our LGMD Natural History Study and in Voyagene, our Phase 1 study evaluating SRP-9003 for the treatment of limb-girdle muscular dystrophy Type 2E in ambulant and non-ambulant patients. It’s in clinical process to materialize SRP-9003. Combined with positive expression functional data shared from our initial study, SRP-9003-101, we believe the data from Voyagene will provide us insights into a broader patient population. Our next milestones for Voyagene include completing enrollment in the second half of the year and beginning our Phase 3 study using commercially representative process material later in the year. Finally, we are on track to commence a systemic pilot study for SRP-6004 dual-vector rh74-mediated gene therapy to treat LGMD2E characterized by the absence of the protein dysferlin. Turning now to the progress we've made with our RNA platform, we are pleased to complete enrollment in the first quarter of 2023 for our MOMENTUM study for SRP-5051 and we remain on track to announce data from the study in the latter half of 2023. Regarding our post-marketing studies or the PMOs, as mentioned last quarter, we completed enrollment in the ESSENCE trial for post-marketing requirement for golodirsen and casimersen and continue to make good progress with our MIS51ON study, which is on track to be fully enrolled this year. In closing, we are looking forward to the advisory committee meeting on Friday, May 12, as it will provide us the opportunity to share the science and the data in support of SRP-9001. I would like to take this opportunity to thank our Sarepta team who have been diligently working these past months. I will now turn the call over to Dallan for an update on our commercial activities.

Thank you, Louise. Good afternoon. In the first quarter of 2023, the team executed on our core RNA business and delivered another strong performance across all three of our RNA-based PMO therapies. As Doug mentioned, we delivered $231.5 million in net product revenue in the first quarter, representing well over 20% growth compared to the first quarter of 2022. Notably, Q1 of 2023 exceeded our expectations and represented the most successful first quarter in the history of our marketed therapies. In Q1, we have historically seen an impact in the U.S. due to the expected insurance changes at the beginning of each year. Due to the extraordinary efforts of the team in navigating those access headwinds, we saw higher-than-expected revenue in the U.S. in the first quarter. Each year, our team is prepared for these challenges, and I'm very proud of their steadfast commitment and sense of urgency with which they serve the Duchenne community. They know that every minute matters for each patient we serve. Total ex-U.S. net product revenue in the first quarter was roughly $31 million. This represented a decrease over the prior quarter, which was expected and fully reflected in our annual guidance forecast. As discussed on last quarter's call, we expect to see continued fluctuations in ex-U.S. ordering patterns quarter-to-quarter. Overall, the fundamentals of the business coming out of Q1 are completely in line with what we expected at this point in the year. We reiterate our full year guidance of greater than $925 million in net product revenue for our PMO therapies. This guidance reflects all of the factors that we navigate and monitor in supporting patients forward. With its increasing global revenue base, we will continue to see fluctuations in the net product revenue from quarter-to-quarter. Importantly as well in the U.S. market, we have now hit a mature phase with all three products, and as such, we expect more modest growth in new patient starts in the coming quarters for the PMO business. Turning now to individual net product revenues for the first quarter of 2023 for our three approved RNA-based PMO therapies. EXONDYS 51 totaled $132.6 million, representing more than 13% growth over Q1 of 2022. For VYONDYS 53, sales were $33 million, growing roughly 18% over the first quarter of 2022. And for AMONDYS 45, sales totaled $65.9 million, representing more than 50% growth versus Q1 of 2022. In addition to the strong performance in our core business, the team has been simultaneously preparing and laying the groundwork for the SRP-9001 launch. The full team is in place and being rigorously trained as we speak. I can say with confidence that they are ready to execute if SRP-9001 is approved. This launch will represent a historic moment not only for Sarepta but for the Duchenne community and genetic medicine. The enthusiasm and confidence of the team is at an all-time high, and they are eager for this opportunity to demonstrate what we are capable of, marking our fourth launch in the Duchenne market. Over the past several months, our field teams and Sarepta leadership have engaged meaningfully with roughly 75 sites of care on strategic and operational site readiness matters. These important interactions will ensure that the sites are ready to efficiently and safely provide SRP-9001 gene therapy to patients as soon as possible. We've also been working closely with sites to provide education and training, and to ensure they have the necessary equipment and resources to deliver the therapy to patients. In addition to site readiness, we know from our experience with PMO therapies that access and reimbursement are crucial to successfully delivering SRP-9001 to patients. We are committed to ensuring that our gene therapy for Duchenne is accessible to all patients who need it, recognizing that meaningfully engaging with payers is a critical part of achieving that goal. We have found that the payers are asking important questions pertaining to the SRP-9001 clinical data, potential patient population size, launch timing, and infusion sites. We are encouraged by the positive response we have received thus far and are pleased with our progress in engaging both commercial and Medicaid payers. If approved, 9001 brings forth a potentially transformative therapy to patients who have been waiting far too long. The team has done a tremendous job preparing for what will be the largest gene therapy launch to date, if SRP-9001 is approved. I'd like to take this opportunity to thank the entire organization who are not only executing to support our current patients, but who have also risen to the occasion so that we are ready as a team for this paradigm-shifting moment. Now I'll turn the call over to Ian Estepan for an update on our financials.

Thanks, Dallan, and hello all. This afternoon's financial results press release provided details for the first quarter of 2023 on a non-GAAP basis as well as a GAAP basis. Please refer to the press release available on Sarepta's website for a full reconciliation of GAAP to non-GAAP financial results. For the three months ended March 31, 2023, the company recorded total revenues of $253.5 million, which consists of net product revenues and collaboration revenue, compared to revenues of $210.8 million for the same period of 2022, an increase of $42.7 million. Net product revenue for the first quarter of 2023 from our PMO exon skipping franchise was $231.5 million compared to $188.8 million for the same period of 2022. The increase in net product revenue primarily reflects increasing demands for our products. In each of the quarters ended March 31, 2023, and 2022, we recognized $22 million of collaboration revenue, which relates to our collaboration arrangement with Roche. The reimbursable co-development costs under the Roche agreement totaled $20.3 million for the first quarter of 2023 compared to $17.7 million for the same period of 2022. On a GAAP basis, we reported a net loss of $516.8 million or $5.86 and $105 million or $1.20 per basic and diluted share for the first quarter of 2023 and 2022, respectively. This change is primarily due to the loss on debt extinguishment of $387.3 million, a non-cash expense incurred in the three months ended March 31, 2023, with no similar activity for the same period of 2022. We reported a non-GAAP net loss of $85.5 million or $0.97 per basic and diluted share in the first quarter of 2023 compared to a non-GAAP net loss of $48.6 million or $0.56 per basic and diluted share in the first quarter of 2022. In the first quarter of 2023, we recorded approximately $35 million in cost of sales compared to $31.4 million in the same period of 2022. The increase in cost of sales is primarily due to increasing demand for our products, as well as the write-off of certain batches of our products not meeting quality specifications for the three months ended March 31, 2023, with no similar activity in the same period of 2022. This was partially offset by a decrease in royalty payments during the three months ended March 31, 2023 due to changes in the BioMarin royalty term. On a GAAP basis, we recorded $245.7 million and $194.3 million in R&D expenses for the first quarter of 2023 and 2022, respectively, a year-over-year increase of $51.4 million. The increase is primarily due to an increase in our manufacturing expenses. On a non-GAAP basis, R&D expenses were $220.7 million for the first quarter of 2023 compared to $173.2 million for the same period of 2022, an increase of $47.5 million. Now turning to SG&A, on a GAAP basis, we recorded approximately $110.7 million and $71.8 million in expenses for the first quarters of 2023 and 2022, respectively, an increase of $38.9 million. The increase was driven primarily by an increase in professional service expenses to prepare for a potential launch of SRP-9001. On a non-GAAP basis, the SG&A expenses were $83.3 million for the first quarter of 2023 compared to $53.2 million for the same period of 2022, an increase of $30.1 million. We expect that our R&D and SG&A expenses will increase next quarter as we continue to prepare for a potential launch of SRP-9001. On a GAAP basis, we recorded $12.7 million in other income net for the first quarter of 2023 compared to $17.3 million in other expense net for the same period of 2022. The change is primarily due to an increase in interest income and the accretion of investment discount from our investment portfolio as well as a reduction in interest expense incurred as a result of the repayment of our December 2019 term loan during 2022. In the first quarter, we exchanged a portion of our 2024 notes with an aggregate principal value of $313.5 million and issued approximately 4.5 million shares of our common stock. We accounted for the exchange as a debt extinguishment, recognizing the difference between the fair value of the shares of common stock transferred on the exchange date and the net carrying amount of the extinguished debt as a loss of $387.3 million, inclusive of the $6.9 million of third-party debt conversion costs. To reiterate, this is a non-cash expense. We had approximately $1.9 billion in cash, cash equivalents, investments, and long-term restricted cash as of March 31, 2023. We remain well-capitalized to execute on our goals for the year and support our transition to profitability, assuming approval of SRP-9001. With that, I’ll turn the call back over to Doug to start the Q&A.

Thank you, Ian. Before we begin the Q&A, let me reiterate. In light of and in respect of the impending FDA advisory committee, we will not be entertaining questions on the regulatory process or the upcoming advisory committee meeting for SRP-9001 tonight. I look forward to discussing those matters with you once the May 12 advisory committee meeting has concluded. With that, let’s open the line to questions.

Thank you. Our first question comes from the line of Colin Bristow with UBS. Your line is now open.

Hey, good afternoon. Huge congrats on the cusp of this approval. On your supply at launch, can you talk about the capacity and ability to meet demand? In light of some comments from your partner regarding production ramp at the Maryland site? Also, can you discuss timelines from a physician prescribing SRP-9001 to a patient receiving therapy given the need for antibody testing and other potential laboring requirements? Thank you.

Yes, thank you very much for that, Colin. Regarding the first part of your question, as we’ve stated, our goal is to fully launch and supply the community, assuming that we receive approval. Our goal right now is to achieve approval by the PDUFA date, which is May 29. We are aware of the comments made by Catalent, and those issues do not play any role in our production plans. Thus, we should be in good shape. In terms of launch, we aim to initiate this therapy rapidly, and our past experience shows we are very capable of doing just that. However, SRP-9001, this gene therapy, entails particular complications including getting a pre-infusion antibody test that is close enough to the infusion so it’s valid, alongside access reimbursement and codes. So while we’ll be launching quickly, expect to see a quarter or two before significant ramp-up leads to seeing patients treated.

Thank you. Our next question comes from the line of Gena Wang with Barclays. Your line is now open.

Thank you. I wanted to ask about your estimate of patient numbers for the initial indication in the U.S. and any major manufacturing expansions needed to supply patients for this initial indication?

To answer your second question first, the answer is no. There are no major capital expenditures or additional expansions required to launch this therapy and serve the community at launch. Regarding the addressable patient population, they range between 10,000 and 15,000 patients in the U.S. Our goal, pending approval, is to serve all ambulatory patients. The ambulant patients constitute about 50%, while the other portion is non-ambulant. There will be patients excluded due to preexisting neutralizing antibodies, currently about 13.5% based on our recent data, and another subset at less than 5%. Our objective is to thoroughly assess and, if possible, expand the addressable patient population through upcoming studies.

Thank you. Our next question comes from the line of Brian Abrahams with RBC Capital Markets. Your line is now open.

Hi. Thanks for the question. Can you elaborate on your preliminary conversations with payers? Do you sense they would be open to paying for 9001 under accelerated approval or would prefer to wait for full approval? Should we expect a similar mix as with the exon skippers regarding the proportion of patients initially receiving access? Thanks.

I’ll provide a general overview and Dallan can follow-up if needed. First, the conversations have gone very well. We've been in dialogue with payers about SRP-9001 for several years now. Our access and reimbursement team has been in constant communication with them. The evidence supporting 9001as a beneficial therapy is substantial. However, access and reimbursement for rare disease therapies can still be complex. I believe that 9001 will be closely watched and that our team will effectively navigate this to gain rapid access for patients. I'm confident payers will respond positively, especially in the context of accelerated approval.

Yes, Doug has covered it well. We’re having great conversations with payers. They're asking solid questions, and we look forward to managing patient access on a case-by-case basis, regardless of when payment policies are instituted.

Thank you. Our next question comes from the line of Judah Frommer with Credit Suisse. Your line is now open.

Hi, thanks for taking the question. Any insight on whether there could be a difference in ramp-up for patients naïve to RNA therapies compared to those currently on PMOs? Any indications around potential value-based payments given that this is going to be the biggest gene therapy launch ever? From a cost perspective, could there be interesting dynamics to the type of payments?

Regarding the first question, I don’t foresee differences in ramp-up as it concerns the patients amenable to this therapy. We plan to treat all eligible patients promptly after launch. We've dosed patients previously on PMOs and they remain on PMOs post-dose. Concerning value-based agreements, I’ll wait until the right time to discuss those, but I can assure you that we've crafted a strong pharmacoeconomic model to illustrate the value of one-time therapies like SRP-9001. Our payer approach will be framed within that context. Qualitatively, the value added to Duchenne patients will exceed the costs to the healthcare system.

Thank you. Our next question comes from the line of Salveen Richter with Goldman Sachs. Your line is now open.

Good afternoon. Can you provide details of where you stand on inventory as you prepare for launch? Also, how broad is your manufacturing relationships to meet supply demands for the first year or two?

We are actively building inventory with Catalent to prepare for the launch, and ensuring this is a high priority for us. Catalent is also prioritizing this effort. Long-term, we have our relationship with Thermo Fisher, which includes a standalone site. We opted to focus on getting one site approved initially in our BLA submission due to the associated complexities. Post-launch, our goal will be to work with the division to qualify the Thermo Fisher site, but for now, we’re on track to launch with our Catalent site.

Thank you. Our next question comes from the line of Gil Blum with Needham and Company. Your line is now open.

Good afternoon and thanks for the question. Doug, earlier you mentioned plans to start studies including non-ambulatory patients and clearing antibody studies. What about potential studies in younger patients, as younger is typically better with gene therapies?

Let me clarify that it’s crucial to reach younger patients. There’s no stage in the Duchenne journey where SRP-9001 wouldn’t be beneficial. We're currently focused on non-ambulant patients, but we have dosed kids as young as three years old. Intended plans also include collaboration with Roche to dose even younger children.

Thank you. Our next question comes from the line of Tazeen Ahmad with Bank of America. Your line is now open.

Hi, good afternoon. Can you clarify the comment about write-offs of certain batches not meeting quality specs? Which products were they, and have those issues been resolved? Also, any update on FDA inspections and their comments?

Yes, that concern was tied to PMOs, a common part of our manufacturing process. This phenomenon has been seen over several quarters; it's simply part of normal operations. We did have some batches that did not meet specifications and were written off, but that's expected and should be anticipated. On the inspections, all FDA inspections are fully complete, and any observations have been resolved satisfactorily.

Thank you. Our next question comes from the line of Danielle Brill with Raymond James. Your line is now open.

Hi, thank you. I have questions on EMBARK. What percent of patients have completed that trial? How frequently do you measure NSAA and how is missing data handled?

I'll address the last part, and Louise can take the first part. The study was fully enrolled last fall. We expect the one-year endpoint to conclude this fall, with the report available early next year. The primary endpoint for the NSAA is one year, but we measure it at intervals before that, as part of the one-year endpoint.

Thank you. Our next question comes from the line of Mike Ulz with Morgan Stanley. Your line is now open.

Hey guys, thanks for the question. Regarding the SRP-9001 launch, do you have a sense of how many patients might want to switch from PMO therapies? How do you plan to manage that?

First, we don’t anticipate a significant impact on our current PMO revenue at launch. There may be some degree of long-term cannibalization, but it won’t happen immediately as patients transition from PMOs to the gene therapy. We will support these patients and welcome their switch to 9001.

Thank you. Our next question comes from the line of Neena Bitritto-Garg with Citi. Your line is now open.

Hey guys, thanks for taking my question. Can you share what you've learned in payer conversations so far? Might payers wait to issue coverage determinations until after they see the EMBARK data? How could that influence their coverage policies post-EMBARK?

We intend to launch this therapy and work with payers for immediate access for patients. I’d remind everyone that our three approved therapies were also achieved via accelerated approval. Our team has been effective in ensuring rapid access for patients who are suitable for those therapies. We will apply the same focus to 9001, and we expect payers to verify this given our strong data backing.

Thank you. Our next question comes from the line of Tim Lugo with William Blair. Your line is now open.

Thanks for taking the question. Can you discuss how you view capital deployments post-approval? You have many studies underway and the need to bolster your pipeline.

Let me first state, we will focus on research and development, which is critically important. Assuming we’re approved, we expect profitability next year. Pricing for 9001 will be determined in the context of our pharmacoeconomic models, ensuring that the value we deliver greatly exceeds the cost to the healthcare system. Ian, would you like to expand on the overall capital deployment plan?

Certainly. We will continue to invest in R&D while focusing on profitability. We will track metrics to ensure returns for shareholders. There are significant market conditions that may allow us to partner or acquire scientific breakthroughs to expand our pipeline further, so we will maintain our approach to lead as an emerging biotech company.

Thank you. Our next question comes from the line of Kristen Kluska with Cantor Fitzgerald. Your line is now open.

Hi, good afternoon. Can you talk about how you intend to handle pre-treatment for those with pre-existing antibodies? I saw you are presenting preclinical data at ASGCT. Any updates?

Yes, there are two approaches being explored. One is working with our partner Hansa and the use of imlifidase, which can cleave and remove antibodies that might prevent a child from obtaining 9001. The second approach involves apheresis to clear antibodies. We have strong preclinical data supporting both. We're looking to initiate clinical studies focused on both strategies soon.

Correct, we have robust preclinical data with both approaches and we are planning to start clinical studies for both strategies soon. Ensuring we can serve the entire community is very important to us.

Thank you. Our next question comes from the line of Hartaj Singh with Oppenheimer and Company. Your line is now open.

Great, thank you. Quick question on the VOYAGENE study for LGMD. If you start the Phase 3 by the end of the year, how much insight would that provide into other LGMD types?

There’s significant potential for synergies. Dr. Peter Mark’s long-term goal is to establish a model for faster timelines using the insights gained from each study that can lead to additional studies. Our modeling should enable us to move faster over time. We greatly benefit from the insights derived from our experience with 9001 as we move forward. Each program has specific needs, requiring unique assays, which takes time.

Thank you. Our next question comes from the line of Debjit Chattopadhyay with Guggenheim. Your line is now open.

Hey, good afternoon. Can you clarify your previous comments about EMBARK in the context of the Advisory Committee?

Certainly. One crucial topic for the advisory committee pertains to EMBARK and the necessity of completing it on time. A reasonable question would be whether an approval won’t impact the success of EMBARK. EMBARK was fully enrolled as of September of last year, positioning us advantageously regarding the completion of our confirmatory trial, which is critical.

Thank you. Our next question comes from the line of Joseph Schwartz with SVB Securities. Your line is now open.

Hi everyone, thanks. Since we're so close to the panel, have you seen the FDA's briefing documents, and how would you characterize their tone?

Regarding your question, we are just days away from the advisory committee meeting. I must emphasize that our efforts are crucial for patients living with Duchenne muscular dystrophy. Therefore, out of respect, we will not discuss the advisory committee or regulatory processes until after May 12. I am confident in our team's ability to present the supporting evidence for seeing positive outcomes for 9001.

Thank you. Our next question comes from the line of Zhiqiang Shu with Berenberg. Your line is now open.

Good afternoon. Regarding the manufacturing ramp, what patient treatment indications do you plan for SRP-9001? Also, on the SRP-9003 program, will there be an accelerated approval pathway?

We will certainly propose a form of accelerated approval for 9003. This is an ultrarare disease. SRP-9003 aims to address the absence of the native protein responsible for patient decline and demise. Regarding the first question, our general goal is to treat every patient who is suitable for this therapy as soon as reasonably possible, ensuring a robust launch.

Thank you. Our next question comes from the line of Gavin Clark-Gartner with Evercore ISI. Your line is now open.

Could you provide your expectations for the Phase 3 primary endpoint and trial design for LGMD2E? When will you align with the FDA on this?

We plan to initiate that study before the end of this year, aligning with the FDA along the way. We're likely to use functional endpoints akin to the NSAA, adapted for limb-girdle, in addition to monitoring expression and safety for 9003.

Thank you. Our next question comes from the line of Ritu Baral with TD Cowen. Your line is now open.

Can you confirm the timing of the EMBARK topline data? Have there been any changes? Any updates on your long-term revenue guidance of $4 billion by 2025?

Our forecast assumes approval this month. No changes to the EMBARK readout have occurred; it remains on track for completion. We anticipate topline results at the end of this year or early next year.

Thank you. Our next question comes from the line of Brian Skorney with Baird. Your line is now open.

Can you discuss study conduct and clarify risks about accelerated approval possibly impacting EMBARK completion?

There is zero risk. EMBARK has been fully enrolled since September of last year. The kids in part one of the study have received their doses. Any remaining kids who haven't been dosed will be dosed shortly. Thus, there are no concerns regarding the completion of the study regardless of whether we receive accelerated approval.

Thank you. Our next question comes from the line of Anupam Rama with JPMorgan. Your line is now open.

On SRP-9003, could we see any data portions from the VOYAGENE study this year, potentially ahead of the commercial material Phase 3?

It’s uncertain whether we’ll have data this year. We’ll keep you updated later on this.

Thank you. I would now like to hand the conference back over to Doug Ingram for closing remarks.

Thank you all for joining us this evening and thank you for your questions. I appreciate your understanding regarding my request not to delve into regulatory matters for the advisory committee. The May 12 advisory committee meeting is crucial for patients living with Duchenne. I am supremely confident in our team’s capability to present the data compellingly. I look forward to reconvening shortly after and discussing our pathway forward. Have a great evening.

This concludes today's conference call. Thank you for participating. You may now disconnect.