Welcome to the Taysha Gene Therapies First Quarter 2021 Financial Results and Corporate Update Conference Call. At this time, all participants are in a listen-only mode. Following management’s prepared remarks, we will hold a brief question-and-answer session. As a reminder, this call is being recorded today, May 11, 2021. I will now turn the call over to Dr. Kimberly Lee, Senior Vice President of Corporate Communications and Investor Relations. Please go ahead.

Good morning, and welcome to Taysha’s first quarter 2021 financial results and corporate update conference call. Joining me on today’s call are RA Session II, Taysha’s President, CEO and Founder; Dr. Suyash Prasad, Chief Medical Officer and Head of R&D; and Kamran Alam, Chief Financial Officer. After our formal remarks, we will conduct the question-and-answer session and instructions will follow at that time. Earlier today, Taysha issued a press release announcing financial results for the first quarter ended March 31, 2021. A copy of this press release is available on the company’s website and through our SEC filings. Please note that on today’s call, we will be making forward-looking statements, including statements relating to the safety and efficacy and the therapeutic and commercial potential of our investigational drug candidates. These statements may include the expected timing and results of clinical trials for our drug candidates and the regulatory status and market opportunities for those programs as well as Taysha’s manufacturing plans. This call may also contain forward-looking statements relating to Taysha’s growth and future operating results, discovery and development of drug candidates, strategic alliances and intellectual property as well as matters that are not historical fact or information. Various risks may cause Taysha’s actual results to differ materially from those stated or implied in such forward-looking statements. These risks include uncertainties related to the timing and results of clinical trials and preclinical studies of our drug candidates, our dependence upon strategic alliances and other third-party relationships, our ability to obtain patent protection for our discoveries, limitations imposed by patents owned or controlled by third parties and the requirements of substantial funding to conduct our research and development activities. For a list and description of the risks and uncertainties that we face, please see the reports we have filed with the Securities and Exchange Commission. This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 11, 2021. Taysha undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call except as may be required by applicable securities laws. With that, I’d now like to turn the call over to our President, CEO and Founder, RA Session II.

Thanks, Kimberly. As mentioned, Taysha has a robust portfolio of 26 gene therapy product candidates for monogenic diseases of the CNS. Our candidates target broad therapeutic categories of immense unmet medical need, including neurodegenerative diseases, neurodevelopmental disorders and genetic epilepsies. We have recently added TSHA-120 for the treatment of giant axonal neuropathy or GAN to our pipeline, making it our most advanced program. We believe the preclinical and clinical data generated to date hold significant promise for GAN patients. Preclinical studies have demonstrated strong proof-of-concept data for both the construct and the delivery modality. TSHA-120 performed well in preclinical studies, demonstrating improved motor function and nerve pathology along with long-term safety across several animal models. Additionally, preclinical data demonstrated that TSHA-120 showed a significant improvement in the pathological appearance of the dorsal root ganglia, a key component of disease progression. Damage in these areas is a topic that has been the focus of much discussion within gene therapy circles in recent months. This is because it has been observed as a histopathological finding in some non-human primate gene therapy studies, although the primates exhibited no functional compromise. Interestingly, in many of the diseases in our neurodegenerative franchise, the dorsal root ganglia have a significantly abnormal histological appearance and function as a consequence of underlying disease pathophysiology. Thus, it was no surprise that when treated with TSHA-120, we saw considerable improvements in the pathological appearance of the dorsal root ganglia in the GAN knockout mice. We are fortunate that, in addition to robust preclinical results, we have a significant amount of natural history data that provide us with patient data to identify optimal markers and endpoints for a clinical trial. To date, there are data in 45 GAN patients that demonstrate an average 8-point decline per year in the MFM32 scores that are consistent across patients of all ages. Recall that a 4-point decline per year in the MFM32 score is considered clinically meaningful. Notably and in line with recently published FDA guidance, regulatory agencies appreciate the availability of a well-controlled and high-quality prospective natural history study as a comparator in clinical trials for rare diseases. In addition, we believe this natural history study provides us with a head start in identifying patients. Based on the positive preclinical results, an R&D path was opened, and TSHA-120 is being further evaluated in an ongoing clinical trial. The primary endpoint is to assess safety, with secondary endpoints measuring efficacy using pathologic, physiologic, functional and clinical markers. To date, 14 patients have been administered intrathecal TSHA-120, and six patients have at least three years worth of long-term follow-up data. TSHA-120 has shown a dose-response relationship with the rest of disease progression at the second highest dose level, 1.8 times 10 to the 14 total VG at one year post-treatment, affecting a statistically significant 8-point improvement on the MFM32 score, in comparison to the predicted natural history trajectory. These results are very promising as a full point change in the MFM32 score is considered clinically meaningful. Six of these patients treated at therapeutic dose levels have shown sustained dose-dependent improvements in MFM32 scores for more than three years. Long-term results demonstrated that treatment with TSHA-120 at multiple dose levels was well tolerated with no severe drug-related adverse events. We look forward to reporting additional data later this year, including results from the highest dose cohort of 3.5 times 10 to the 14 total VG. The FDA has already granted TSHA-120 orphan drug and rare pediatric disease designations, and we will continue to work closely with regulatory authorities in the U.S. In the near term, we expect to have discussions with the FDA and engage with other major regulatory agencies by year-end to discuss the pathway to approval for TSHA-120. I would also like to highlight some of the promising preclinical data coming from our earlier-stage candidates that demonstrate the incredible breadth, depth and velocity of our development engine. It is important to note that there are no approved disease-modifying therapies for any of the programs in our portfolio. With such compelling data to date for our pipeline, we are very encouraged as our gene therapy candidates could offer significant value to meaningful patient populations. We are very excited to show new preclinical data for TSHA-102 in Rett syndrome that was recently published in a respected journal. As discussed earlier, historically, it has been a challenge to find the right approach to safely regulate MECP2 expression in this disease. The complexities are highlighted by phenotypic variability, mosaicism and the need to regulate MECP2 in such a way that it does not cause over-expression related toxicity. Today’s data give us confidence that we can achieve appropriate MECP2 expression in all cells in a genotype-dependent manner with no signs of toxicity. With the built-in regulatory element, miRARE, TSHA-102 provided a statistically significant survival extension in knockout Rett mice by 56%, while the unregulated mini MECP2 gene transfer failed to significantly extend knockout survival at either dose tested. Additionally, the unregulated full-length MECP2 construct did not demonstrate a significant extension in survival and was associated with an unacceptable toxicity profile in wild-type mice. We believe that the 56% improvement in survival in TSHA-102 treated knockout mice is extremely impressive. I see adolescent mice that have accumulated significant disease. Of note, Rett patients do not demonstrate symptoms until about one year of age, and therefore, will not be treated until after this point; we believe these data are likely to be highly translatable to the clinical setting. In addition to survival, behavioral side effects were explored; TSHA-102 treated wild-type mice have a significantly lower, meaning better, mean aggregate behavioral score than those treated with unregulated full-length MECP2 and regulated mini MECP2. Importantly, miRARE mediated genotype-dependent gene regulation was shown by analyses of tissue sections from wild-type and knockout mice treated with AAV9 vectors given intrathecally. TSHA-102 demonstrated reduced levels of MECP2 in different regions of the brain, suggesting that miRARE inhibited mean expression in a genotype-dependent manner. This demonstrates that TSHA-102 achieved MECP2 expression levels within normal physiological parameters. In summary, these positive data demonstrated miRARE’s ability to exhibit genotype-dependent regulation of MECP2 gene expression across different brain regions in both wild-type and knockout mouse models of Rett syndrome without overexpression toxicities. We are very encouraged by these results and look forward to filing an IND or CTA in the second half of this year, followed by initiation of a Phase 1/2 trial by year-end. TSHA-102 has the potential to address a significant unmet need for an estimated 25,000 patients with Rett syndrome across the United States and in Europe. Now I’d like to highlight some of our other preclinical programs that we have recently released data on. TSHA-104, which is currently in IND/CTA enabling studies for the treatment of SURF1-associated Leigh syndrome, has demonstrated increased COX1 activity in brain and muscle and restored elevation of blood lactate on exhaustive exercise in a dose-dependent manner in SURF1 knockout mice. Dr. Qinglan Ling of UT Southwestern will be presenting these compelling data this Thursday at ASGCT. We remain on track to file an IND or CTA in the second half of this year. TSHA-105, our gene therapy candidate, which is currently in IND/CTA enabled studies for the treatment of SLC13A5 deficiency, caused a significant sustained decrease in plasma citrate levels up to three months post-injection compared to aged mouse wild-type controls. TSHA-105 normalized EEG brain activity, reduced the number of seizures and reduced seizure susceptibility compared to vehicle-treated controls. Dr. Rachel Bailey will be presenting these positive data this Thursday at ASGCT. TSHA-103 is a gene therapy candidate that is in IND/CTA enabling studies for the treatment of SLC6A1 haploinsufficiency. In SLC6A1 knockout mouse model, TSHA-103 improved nesting and EEG activity. In addition, in SLC6A1 knockout and heterozygous mouse models, TSHA-103 reduced spike train activity, which is a recording of abnormal neuronal activity associated with seizures. We believe the estimated prevalence is 17,000 patients in the U.S. and Europe. TSHA-111-LAFORIN and TSHA-111-MALIN, our gene therapy candidates in IND/CTA enabling studies for the treatment of both subtypes of Lafora disease, achieved effective knockdown of GYS1 expression in the Lafora disease, LAFORIN and MALIN mouse models, respectively. Both product candidates decreased Lafora body formation within the brain and their respective mouse models. TSHA-112 has been tested in IND/CTA enabling studies for the treatment of adult polyglycosan body disease, or APBD. In preclinical studies, miRNA knockdown of GYS1-induced significant reductions in GYS1 mRNA, GYS1 protein, abnormal glycogen accumulation and polyglucosan bodies throughout the brain in an APBD knockout mouse model. For GM2 AB variants in preclinical studies, TSHA-119 caused a significant dose-dependent reduction of GM2 accumulation at 20 weeks in mice that were dosed intrathecally at postnatal day one or at six weeks of age. Long-term follow-up, which includes bi-monthly behavioral as well as biochemical and histological analyses are currently ongoing. TSHA-106 is being developed for the treatment of Angelman syndrome. In vitro testing and the neuro plus cell line demonstrated consistent knockdown of UBE3A-ATS and the subsequent increase in UBE3A expression across 26 distinct shRNA candidates. Selection of a development candidate is expected by midyear, followed by interim expression and safety data from confirmatory non-human primate studies by year-end. TSHA-113, an AAV-mediated gene knockdown construct, has shown particular promise. TSHA-113 AAV9 capsid packages micro RNA shufflers designed to target tau mRNA for all six isoforms found in the human and/or mouse brain. Treatment with TSHA-113 has shown a significant reduction in tau mRNA and protein levels while demonstrating widespread expression in neurons and GLIA. This has potentially significant implications for patients with neurodegenerative disorders characterized by deposition of abnormal tau protein in the brain, including Alzheimer’s disease, MACI-associated frontotemporal dementia and progressive supranuclear palsy. As you can see collectively, these preclinical data highlight our next wave of novel gene therapies with the potential to impact patient populations affected by significant diseases in a meaningful way. With that, we intend to file an IND or CTA for one of the following programs by the end of 2021: SLC13A5 deficiency, Lafora disease, APBD or GM2 AB variants. We also remain on track to file an IND or CTA for TSHA-102 in Rett syndrome and TSHA-104 for SURF1-associated Leigh syndrome along with an IND for TSHA-101 in GM2 gangliosidosis in the U.S. during the second half of this year. We expect to initiate the Phase 1/2 trial for TSHA-118, which is under an already open IND. We are excited to have six near-term Phase 1/2 trial initiations planned throughout our portfolio. We are making incredible progress advancing our product candidates into clinical development, and we look forward to providing additional updates at our R&D Day that will span two days in June. We will continue to advance our pipeline by leveraging our next-generation platform technologies. As part of this initiative, we have recently established collaborations with Dr. Dennis Lal at the Genomics Institute, Cleveland Clinic, and Dr. Yang Xiaoyong at Yale University to further push the boundaries of AAV vector engineering by developing next-generation minigene Halos. This has the potential to overcome current limitations of packaging capacity, which is a critical barrier to treating genetic diseases not addressable by conventional AAV gene therapy technologies. This may enable us to effectively treat a wider range of devastating CNS diseases. UT Southwestern will produce bio vector constructs that incorporate the minigene payloads and evaluate the constructs in both in vitro and in vivo studies. Through the collective efforts of Taysha and our partners, we will continue to strive for innovations in our platform technologies that will enable us to treat a broad range of CNS diseases with novel gene therapies. With that, I’ll turn the call over to Kamran to review our financial results.

Thank you, RA. This morning, I will discuss key aspects of our first quarter 2021 financial results. More details can be found in our Form 10-Q, which will be filed with the SEC shortly. As indicated in our press release today, R&D expenses were $23.9 million for the first quarter ended March 31, 2021, compared to $5.5 million for the first quarter ended March 31, 2020. The increase was primarily related to the company’s development program as a result of increased manufacturing-related spending, clinical and preclinical activity and headcount. G&A expenses were $8.2 million for the first quarter ended March 31, 2021 compared to $0.07 million for the first quarter ended March 31, 2020. The increase was primarily due to an increase in personnel costs, resulting from increased headcount, professional services fees, and other corporate-related expenses. The net loss for the first quarter ended March 31, 2021 was $32 million or $0.87 per share as compared to a net loss of $5.4 million or $0.50 per share for the first quarter ended March 31, 2020. As of March 31, 2021, Taysha had $228.7 million in cash and cash equivalents. We continue to expect that our working capital will be sufficient to fund our operations into 2023 inclusive of the development, regulatory, and operational milestones RA and Suyash have outlined today. And with that, I will hand the call back to RA.

We will now start the question-and-answer session. The first question comes from Salveen Richter from Goldman Sachs. Please proceed.

Good morning. Thanks for taking my questions. So one question here about capital and resource allocation as you’re running multiple trials, building out a GMP facility and hiring employees. So how should we think about that over time? And secondly, with regard to the Rett program, maybe if you could touch on the registration path here and what you’d like to see from that first clinical data set to inform the pivotal program.

Absolutely. Thanks, RA, and thanks for the question, Salveen. Yes. So for Rett syndrome, I think we’ve been spending a lot of time thinking about the clinical development program and the pathway to approval. We’re going to take a slightly more cautious approach for some of our other conditions such as GM2, CLN1, and GAN where the diseases are a little less common and where there is an ongoing relatively high risk of mortality quite early on. So the way we think about Rett is that the first study of a group of two will be more of a Phase 1/2 primarily safety study with some exploration of preliminary efficacy. Following on from that, you will then perform a Phase 2/3 study, which focuses—taking learnings from the initial Phase 1/2 study and applies it into a more extensive Phase 2/3 pivotal efficacy study. Now with regard to the first study, the Phase 1/2 study likely we’ll be targeting older patients. As you know, the FDA tends to push you away from children towards adults first, and in this particular situation, we actually tend to agree with that approach. There are these risks of toxicity with overexpression of MECP2. So we just have to be quite mindful when we design this initial study. The first study will be a Phase 1/2 clinical pivotal safety study, its primary efficacy in the adult population. In terms of endpoints, we’ll look at the safety aspects of safety initially. Then we’ll be looking at efficacy in three different buckets. The efficacy will be assessed firstly with a number of different Rett-specific clinically rated scales, such as the Rett syndrome motor behavior assessment and the Rett syndrome behavior questionnaire. So these are the Rett scales; we’ll also look at seizures in some detail because children with Rett syndrome have significant seizure activity. So we’ll examine how frequent the seizures are, how many medications they are on, what triggers the seizures, how durable the seizures are, and over time, hopefully, we will be able to see a reduction in seizure activity and help reduce their need for medications, and also see improvements on their EEG. The third bucket of assessments will include general multi-systemic, multi-organ aspects of Rett syndrome disease characteristics—such as respiratory assessments, which, as you know, can be problematic in Rett syndrome, including sleep apnea issues, cardiac issues such as QT prolongation. So, the first study will look at safety initially and some of these areas of preliminary efficacy, then we will build from there to design the Phase 2/3 study. As we discussed earlier, we’ll be engaging with regulatory agencies during the course of this year to pressure-test our thinking around these plans, and we’ll be starting the clinical study towards the end of the year.

Thank you.

The next question comes from Matthew Harrison from Morgan Stanley. Please go ahead.

Good morning, this is Thomas on for Matthew. Can you give an update on where you are with manufacturing for the GAN program, in particular, what sort of assay work do you still need to complete? Thank you.

Yes, thanks, RA. Thanks for the question, Matthew. Yes, we’re in the process of onboarding the GAN program. With that, we’re really beginning with the assays, reviewing the assays that were conducted by the NIH for the Phase 1 and Phase 2 clinical material. Our intention is to try to update those methods to qualify and then validate them to prepare for late-stage pivotal work. So, we’re actively engaging on all critical quality attributes assays with our partners to move that forward with our contract development and manufacturing organization (CDMO). In addition, we’re looking closely into the development of the potency assay, and this is something that’s happening jointly between Suyash’s group and my own to advance a fully developed and qualified potency assay alongside pivotal lot manufacturing.

The next question comes from Raju Prasad from William Blair. Please go ahead.

Hey guys, thanks for taking a question. Congrats on the progress. I’m kind of looking down your pipeline and I see a lot of the technologies that you’re de-risking from a payload perspective, the miRARE platform, the bicistronic vector. I could see follow-on indications once those technologies are de-risked. But my question was more on the regulatory side. As you’re kind of dealing with regulators on these different indications, what types of aspects of the programs do you think will be de-risked by clinical data? Is it on endpoints and discussions with the FDA? Is it on the intrathecal administration? Maybe some color there would be great. Thanks.

Thanks, RA. Thanks, Raju, for the question. Yes, there are many commonalities, I think, between our programs, over and above the simple trifecta of comments we make about AAV9, HEK293 and intrathecal administration. There are many other commonalities; I think it’s shared as a platform more than anything. Let me touch on a couple of things—I think we’re going to learn a huge amount from just one program to inform the next. There’s a lot of debate in the field about intrathecal versus intracerebral versus intracisternal administration and several contributions between them all. I keep coming back to the perspective that intrathecal administration has worked for decades and it's been effective in the world of oncology and anesthesiology. When you look at the clinical data from GAN, CLN3, CLN6, and from Zolgensma, you see that it has worked beautifully. I think as we continue to build our portfolio of programs, I believe the FDA and other regulators will become increasingly comfortable with intrathecal administration. There are many nuances and details around that. For example, we spent some time yesterday talking about the different types of kits you might use to administer intrathecal drugs and the compatibility tests you might need to do for these various methods of administration. So I think there are many lessons to be learned, particularly from GAN that will inform the rest of our portfolio. Another piece of learning that I think is crucial from GAN and as our programs progress is related to the immunosuppression regimen we like to use. The whole world of immunology in gene therapy has evolved rapidly over the past few years. Initially, people didn’t use any immunological therapy and simply treated liver inflammation reactively with oral prednisolone. Then it was decided to give prednisolone proactively to try and prevent issues. Additional medications have been added since then as well. We’ve settled on a very refined regimen of six months of oral prednisolone plus 12 months of rapamycin, with specific doses that we have a lot of experience with now. Learnings from the GAN program, where several patients have been managed with this regimen have been very successful. To the point where we are not seeing any evidence of T cell-mediated inflammation in any of the patients who received this regimen from the GAN study. We’re using that approach in GM2, CLN1, and SURF1. I think we will build up this body of evidence for that particular regimen. The third thing I’ll mention, and you touched on it, is endpoints in the clinical trial and what we can learn from one to the other. I think for many of our diseases where there are neurological features, there is a development called regression associated with a failure to meet milestones. We’ve identified a robust set of assessments—the Bayley scale, the Vineland, and the CHOP INTEND, among others that are more disease-specific. We know how to train the raters to perform these evaluations. We capture videos of these assessments in a precise way, which helps us upload the videos to a server where they can be reviewed externally by a second group of raters who are blinded to patients’ treatment status. All these elements add a layer of robustness to our clinical development program and allow learnings from one to the other. I hope that answers your question, Raju.

Yes, that’s extremely helpful. Maybe just a quick follow-up on that last point. As it relates to the upcoming FDA discussions on the GAN program, how should we be looking at the results of those discussions as it relates to the potential request from the FDA? I’m thinking particularly about the natural history comparator versus having to run a placebo arm or control-treated arm. Is that something you’re looking to see as a strategy for the rest of the pipeline? If they do give you a natural history comparator for pivotal studies, is that something you might try for GM2 and other rare diseases? Or do you think these discussions on GAN will only apply to GAN and each indication will pose different discussions with the agency?

So that’s a really important point. The amount of existing data for a particular disease certainly affects how we approach it. There are many commonalities from proven programs, but there are also subtle differences, and we’re handling things a bit differently from program to program. What I can say at a higher level is that there is some very nice guidance that was published by the FDA on gene therapy development for neurodegenerative disease, which includes a specific section on natural history studies and historical controls. They stated very clearly that this may be appropriate for a gene therapy product aimed at treating a rare and serious neurodegenerative disease, especially if there’s a clear unmet medical need, which is absolutely the case for most of our programs. They outlined that if including a current control is impractical or unethical, which is indeed true for programs like GM2 or CLN1, where there is an ongoing high risk of mortality, it may be suitable to utilize a natural history comparator. Moreover, the disease course must be well documented, and the anticipated treatment effect large; this makes it very suitable to use a natural history study as a control. For GAN, specifically, we have data from over 45 patients, and indeed we’ve presented data from 45 patients in the natural history study with a track record since 2013. This gives us clear evidence of a consistent drop in the primary efficacy endpoint, the MFM32, of 8 points per year on average. Given this predictability, we feel fairly optimistic about the potential for a natural history study to serve as an appropriate comparator, but we’ll see what the FDA has to say. My guess is that it’s unlikely they will request us to conduct any formal concurrent control study, but, as always with the FDA, there are uncertainties. Regarding GM2, there is already good natural history data available in publications, and we’ll be harnessing that. CLN1 has a prospective natural history study that is currently ongoing with about 40 to 50 patients. This is international in scope. So, while each program will have its unique considerations, I believe we will apply similar principles as appropriate. For Rett syndrome, there is extensive natural history data available; although for Rett, we will likely build in a concurrent control for a randomized but non-blinded concurrent control to enhance robustness in the clinical development plan. I hope this adds context to your inquiry.

No, that’s extremely helpful. Thank you for the clarity.

The next question comes from Eun Yang from Jefferies. Please go ahead.

Thank you. So today, when we talk about addressing the patient population for your gene therapy programs, it’s been kind of focused on the U.S. and Europe. But now that you look towards the potential approval of TSHA-120 in 2023, what are your thoughts on the market opportunity outside the U.S. and Europe? And I have one more question on the Rett syndrome program. So, I’m sure that you’re familiar with the Novartis program. I don’t know how much you can speak about it, but aside from your program potentially having a better regulation of the transgene expression, can you talk about the differentiation compared to Novartis, as they are actively pursuing their Rett program? Thank you.

Yes. Thanks, RA, and thanks for the question. I think this is an important question. As RA mentioned, the primary difference is that we include—we have the mini MECP2 gene, developed by Professor Sir Adrian Bird and highly regarded Rett experts from Edinburgh, who first demonstrated unequivocally that Rett syndrome is a highly reversible disease. We use his design for the mini MECP2 gene and attach it with a strip of micro RNA binding sites, the miRARE platform, which stands for micro RNA responsive auto-regulatory element. As MECP2 levels rise within the cell due to gene therapy, the down regulatory micro RNA binding sites are triggered, binding to the miRARE platform located in the untranslated region of the construct, bringing down levels of MECP2, serving as a safety valve. We are very excited to say that the first quantitative data demonstrating this reduction in MECP2 expression, achieving a balance that is efficacious yet not toxic, was published in a prestigious journal recently. I encourage you to review the paper for more insights; the lead author is Sara Sonet, with senior authors being our Chief Scientific Adviser, Steven Gray. There's a particular diagram in that paper that illustrates different expression levels of MECP2 in various regions of the brain and spinal cord. We can see very clearly that the non-miRARE construct over-expresses, while the miRARE construct maintains efficacy without toxicity. My understanding is that Novartis is still moving forward with their program, and the last I heard they are planning to proceed with an IND, though I cannot provide exact details on their status. But I believe this is the main difference between our products.

Thank you for the details.

There are no further questions. I will now turn the call over to Mr. Session for his closing remarks. Ladies and gentlemen, this concludes today’s presentation. Thank you once again for your participation. You may now disconnect.