Transcript : Sana Biotechnology, Inc. Presents at Goldman Sachs 46th Annual Global Healthcare Conference 2025, Jun-10-2025 08

Published: 2025-06-10 09:50:18 ET SANA

Published on 06/10/2025 at 09:50 - Modified on 07/18/2025 at 17:56

Great. Good morning, everyone. Thank you so much for joining us. Really pleased to have with us this morning Dr. Steve Harr, who's the President and CEO of Sana Therapeutics. I'm Salveen Richter, I cover the biotechnology sector.

Steve, before we jump into the programs here, perhaps level set us with where the company stands today regarding the portfolio strategy and key priorities and walk us through what we should look to from the pipeline over the next 12 months.

Sure. So first of all, thank you for having us, Salveen, and thank people for joining us this morning, and I appreciate people listening online as well. As you probably know, we'll make forward-looking statements. So please do take a look at our risk factors to outline some of the risks for an investment. So -- it's hard to actually delve into the portfolio strategy without delving into the pipeline and the programs, but because they really drive it. We don't have a commercial program.

So maybe I'll just kind of lay out the table a little bit. So -- the company has -- started really, and we've been building 2 different technologies. One -- and maybe just take a step back. The goal is to be able to use cells as medicines and to be able to engineer cells in vivo to either replace missing cells or to fix damaged cells. And so the 2 most important areas we thought to be able to realize that vision was, one, to be able to modify cells, allogeneic cells or someone else's cells so they could be transplanted and they can replace a missing cell. And that's a technology called the hypoimmune technology, and I'll come back to that in a second.

And the second is to be able to modify genes in vivo and deliver the genetic material. So you can more or less do anything you want to a cell in vitro or in a petri dish and the hard part has been doing that in vivo. So to kind of go into that, the majority of the company's capital is allocated towards a hypoimmune platform. And the hypoimmune platform, as I said, is a series of genetic modifications that we believe will hide cells from a recognition by the immune system and rejection of allogeneic cells by the immune system. And the most important area that we're applying that is type 1 diabetes.

And so type 1 diabetes is a really rare opportunity when you take a step back and think about it. It's a disease that affects about 9 million people in the world, almost 2 million in the United States. It grows at about 5% a year. It's a disease where for people who have it, they are likely to live 10 to 15 years less than someone without it. And during that time, they face a number of complications. They can have blindness, heart attacks, strokes, amputations. They also have the complexity of day-to-day management of their blood sugars. And if they take too much insulin, they can die or have other serious side effects from hypoglycemia. And you have all of that and you have a disease where there really hasn't been a meaningful progress in 100 years, right?

Up until 100 years ago, and really the discovery of insulin, it was a death sentence to get type 1 diabetes. And there have been modified forms of insulin and better ways to monitor your glucose, but it's more or less the same disease. We have this chance and a goal to be able to give patients a single treatment, one therapy, where they will end up with normal blood sugars for life with no more insulin and no immunosuppression. And it will work. It may not be safe. We may not be able to scale it. We may have capital. There's still a lot of risk along the way. But I think all of the boxes have been checked to turn this into a real therapeutic for patients, and we'll go through that.

The second area really where we allocate capital is around a allogeneic CAR T program, that allogeneic CAR T program we're taking forward both in oncology and in the autoimmune setting. It's a difficult place to develop the drug right now. I think that the investor base has a bit of fatigue around CAR T cells. I'll come back to kind of how we think about that in a second. And it's an area where there's a lot of competition, right? But it is also an area where you offer patients, at least some percentage of patients the opportunity for a single treatment and maybe a long-term durable remission or even a cure. And we've made some good progress there.

And the third is in vivo delivery of genetic material. And those are kind of the 3 areas. And as I think about portfolio strategy, really, we've asked, given the complexities of the market and someone said to me last week, and it came up, I hadn't seen this person a while and it's been a tough market for the last few years. Health care has been the worst performing sector. Within health care, biotech has been the worst performing sector. Within biotech, cell and gene therapy has been the worst performing subsector. How are you doing, right?

And it is something where we have to be very thoughtful about capital allocation. And so really within each of those 3 areas, I'd say, just to start with within the broad portfolio, we will invest in type 1 diabetes at all costs. right? That was something that -- I kind of think of it as a generational opportunity, and it will be protected.

Everything needs -- we need to understand, is it a source of capital or use of capital. And if it's a use of capital, is it something that our investor base broadly wants to pay for. And I'm quite confident our investor base broadly wants to pay for type 1 diabetes. I'm less confident that it wants to pay for some of these other areas, which means that if we can't find ways to turn them into sources of capital, mainly through partnerships and things like that, they'll have a difficult time moving forward. And so -- that's a little bit of how we thought about portfolio strategy and where we are with the programs.

Great. So delving in here to your type 1 diabetes portfolio, your lead program is 451, which is a hypoimmune iPSC-derived islet cell therapy for type 1 diabetes and you're expected to file an IND in 2026. In parallel, we've seen data from investigator-sponsored trials. Help us understand how the IST differs from your lead program and what the key IST findings are that support your 451 development?

Yes. So IST being an investigator-sponsored trial, as you said. So take a step back. Type 1 diabetes immunologically is complicated. But physiologically, it's pretty straightforward. Physiologically, a patient or a person who has type 1 diabetes, their immune system has destroyed all their pancreatic beta cells, and so they no longer make insulin in response to glucose. And so insulin replacement therapy has kept people alive, but it's difficult. And about 25 years ago -- so the idea would be, can we replace these pancreatic beta cells and return the patient to normalcy, right? About 25 years ago, a group led by James Shapiro in Canada did the first pancreatic islet transplants. And so what they did is they took from a cadaver or a recently deceased person, their pancreas, isolated out pancreatic islets and islets are alpha, beta and delta cells.

So I'll go back and forth between those. But they isolate the pancreatic islet, which gave patients new pancreatic beta cells and transplanted them. And the patients did amazingly well. So these patients, many of them are now out 10, 15-plus years, and they're off insulin. But there are 2 big problems with that. One, it's not a very good supply source, right? It's not scalable. It's very variable by how much perimortal kind of ischemia someone's had.

And two, there aren't that many patients for whom lifelong immunosuppression is better than lifelong insulin. So there have been thousands of these, but this is a disease that affects millions. So a few years ago, several parties have started doing pluripotent stem cell-derived islets. So you can take a pluripotent stem cell and make it into most cell types and made them into pancreatic islets, and they transplanted that. And that seems to work, right? It works very well. And it's probably a more consistent result. 100% of patients have benefited to date. And it sounds like it is likely going to be more scalable.

But you still have the problem of immunosuppression. So the key last step in our mind to be able to prove that a cure of this disease was inevitable was getting rid of the immunosuppression. So what we did in this investigator-sponsored trial is we partnered with a group in Uppsala, Sweden, who ran it. And they -- that's where the Nordic network is run out of and they do a lot of these islet transplants. And so we applied the gene modifications that we use, which we can get into to hide these cells from the immune system to a cadaveric islet and it worked.

So the patient is now making insulin and there's no immunosuppression and he's making insulin for the first time now in over 35 years. We updated 12-week data that looks great. The patient had very consistent levels of a protein called C-peptide. I see when our beta cells make insulin, they actually make pro insulin and when it's secreted, it's cleaved into insulin and C-peptide. So C-peptide is a 1:1 measurement of the amount of insulin that our body is making. Those patients making insulin for the first time in 35 years. And in a mixed meal tolerance test, it showed -- we've shown that it's glucose sensitive. So eat a big meal and make more insulin.

The third is we can see them both in MRI and we've shown them in a PET scan as well, so you know their beta cells. It's a simple surgical incision into the arm and patient is making his own insulin. So that, in our mind, kind of circled the -- closed the circle and all the components you need to be able to have a curative therapy with this disease. So then what SC451 is it's a gene-modified pluripotent stem cell. You start with a single cell, literally 1 cell. And you look and you really understand its genome, it's genomic stability, everything about it, and then we grow them many, many times -- many fold. Then you differentiate them into pancreatic islets. So what we hope we have there is a real therapeutic, right? It's a consistent product over time that is scalable.

It can be transplanted and made broadly available for patients and where, again, the goal is 1 treatment, it surges intramuscular into the arm. And the patient will end up with normal blood glucose with no insulin and no immunosuppression for life. That's been a challenge to make SC451, which is the drug I can get into that in a second. But that's a big difference. It is a stem cell-derived therapy that's scalable and consistent over time, whereas the other was a cadaveric islet where we applied the gene modifications at a subscale with the goal of just proving the immunology, which we did. And by the way, we'll have 6-month data from that at the American Diabetes Association meeting on June 23 at 9:00 a.m. Central Time in a plenary session at that meeting.

Before we jump over to scale, regarding read-through to your programs, are there any remaining questions on durable HIP modified cell survival in your drug or in the CAR T setting that we -- or anything that we need to ascertain on this front?

From -- sorry, anything left in the CAR T program you're saying?

Questions regarding durable HIP modified cell survival.

Okay. Yes. So HIP, we call it HIP, hypoimmune platform. That's the -- so the -- so what is the -- so we've now shown this in multiple contexts that we can make these gene modifications and the cells are not recognized in the immune system and they survive, right? And so we've shown this in type 1 diabetes, where there's 0 immunosuppression on board. And a patient actually has a preexisting immune response to that cell, right? It's an autoimmune disease where they destroy all pancreatic beta cells. And so our immunologist really felt like if you saw no immune rejection at a month, there was nothing that would capture. Others have said we'd like to see 3 months, I've shown you. You've heard from competitors and things that people should hold out until 6 months, you'll have that soon. I think to get past 6 months, some people may say they want a year. People want more after a year, I can't imagine anybody can really say much. So that's really that one.

And then we've also applied as you said, these to CAR T cells, in multiple settings, both in terms of targets, CD19 and CD22 in people and in both autoimmune disorders and in oncology. We've never shown you the autoimmune data. But we have shown you oncology data that show that there's no immune response to these cells. So I think it's pretty well established. In that setting, you are -- patients are getting lymphodepleting chemotherapy, which beats up their immune system. We're targeting what we showed you CD19 or CD22 which beats up their immune system. So it's a little bit less robust test of the platform than the type 1 diabetes, which is about the highest bar you can get and it works.

So I think it's -- I won't tell you it's going to work in every setting for every cell type. I think everyone needs to be discovered -- looked at separately. But I do think it's a broadly applicable cell technology across multiple cell types and across pretty much all patients.

The ISP assessed an implementation of a low dose of modified cells roughly 2% to 7% of what's needed for insulin independents. So if you were to scale here, is there any risk that injecting 25x more cells could somehow overcome the hypoimmune invasion mechanism?

No. No. And in fact, one of the things that we showed -- when we do these -- when you do this cadaveric islet program, so you take a, let's just say, an x number of cells, and we make 3 genetic modifications to them, right? So we knock out 2 genes, knock in 1. And only about 50% of cells have all genetics. And so we can look at unedited cells, partly edited cells and fully edited cells. And what you see is a very robust immune response and killing of the cells that are not fully edited.

So even at that -- you can see that there's an immune response already. And this, we are completely capable amounting an immune response to this number of cells. The challenge is as you increase dose. One is scale, right? So it's manufacturing. Two, there's volume, right? We have to make sure that we don't yet know what the volume will end up being that we inject. So it might have been more than one injection, more than one site. I mean those things we'll have to see is that we have to really figure out our final formulation and the concentration of cells to understand that. We are not quite there yet.

But from an immunologic perspective, it's pretty straightforward. I mean, there's already plenty of cells in there to have an immune response. They generated one, the patient did against on and partially edited cells. They will not see these fully edited cells.

As you noted, you're giving an oral presentation on the ISC, the upcoming ADA meeting, can you frame expectations here? Will we see any new data that we haven't seen previously with regard to follow-up? And could we see some of the preclinical data from 451 as well at the conference?

So I'll start there. first part. So what you should expect? I've been really clear what I think will happen here. Once you get past the month, these cells are going to do fine. So what you should see is that at 6 months, I hope, that you have no evidence of all the condition the C-peptide levels are stable and you get glucose-sensitive insulin secretion. You see on MRI, if they look more or less the same. I mean all that stuff should be true. So -- and if it isn't, I'll be surprised, but we'll have to see what the data really are. And patients just came in, just hit the 6-month visit. I think we disclosed that original -- this presentation that the patient was transplanted in early December, so it would have come in, in the last few days. So that would be my expectation. We'll see what we have.

I don't think we'll see beyond what you've seen at 1 month and 12 months in terms of parameters, I presume that we'll be more or less presenting the same parameters, but at 6 months, but they may do something different. From the SC451, the stem cell-derived therapy, not as part of that presentation. There won't be more from it. But you've seen a lot. So I kind of think of this as there are 4 major scientific challenges to making one of these -- to making this vision of a gene-edited stem cell-derived therapy a reality.

The first is you need to overcome autoimmune and allogeneic rejection, but check that box, and you'll see that data. Hopefully, that would be true at 6 months as well. Number 2 is you have to make the drug at a purity, potency and yield to run a clinical study. We've done that. Others have. I mean that's -- so we've done that.

Number three, is you have to make a gene-modified master cell bank. So a single cell you start with, right, where as you try to make trillions and trillions of cells you have real genomic stability. And what you'll see if you're not very -- if you are extraordinarily careful in the field, I'm not sure anybody has ever made a GMP gene modified pluripotent stem cell, cell bank is you see the emergence of some mutations. We've now done that.

We think -- we need to -- we have an upcoming meeting with the FDA that's very soon, where we will hopefully align on what the testing strategy is. That said, yes, you've actually kind of accomplished that. And if we have, I think that's another many-year advantage for the company because, again, I think it's something that we struggle with for a while.

The fourth is you have to make these cells at a scale that allows us to treat a disease that has millions and millions of people. We're not close, right? So that's kind of, of these 4 big challenges, I think we've really nailed 3 and we have 1 to go. And we haven't really, really invested dramatically in that last question yet. We've been really focused on the first 3, but we'll ultimately have to get to that fourth to make the important medicine we hope we have.

Can you speak to your progress on generating a master iPSC cell bank?

Yes. So that's -- so it's been -- so this has been really hard. It's been really hard. And so what we're trying to do is we -- sorry. We knocked 2 genes out and we knocked 2 genes in, right? So the 2 genes to get knocked into a safe harbor site that is known by us to be where you see no epigenetic modification of the expression over time nor do you see a change as you go through differentiation state. So that -- where we're knocking in is both CD47 for overexpression as well as a safety source. So we can kill these cells if we want to.

The challenge has been as we make those gene modifications and grow the cells over time, there's a lot of stress that comes in these cells. And you really -- if you think about it, every patient is going to have a dose that's plus or minus 1 billion cells. So if you say you need a little bit more than that from every batch to be able to do testing. Let's just say it's about 2 billion cells per dose. If you want to treat 1,000 people, that's 2 trillion cells that you have to make. If you want to treat 100,000 people, that's 200 trillion cells a year, right?

If you just want to treat -- if you treat 100,000 people a year for a decade, you have only treated 10% of people. So just like the scale of this is just so large. And you just see these mutations come up. And so it's taken us a long time to figure out how to really make these cells without mutations arise. And I think it's 3 things that it takes.

You have to really end to have a really high-quality starting cell. The conditions you do this under are super important, and you have to have luck. I mean I think all 3 of them come together to create a single cell that we've now tested the one we have, which I really hope is when we take forward we've gone through over 60 divisions, which is 2 to the 60th is over quintillion cells to put it in a perspective, right, you could treat millions of people with that number.

We have done differentiation and transplanted cells into mice and seen them out 15 months, and they function and you see no histologic abnormalities or emergence of any tumors. And so it's well tested. It is scalable. It's got all of the features that we wanted to have to be able to treat basically any person in the world. So fingers crossed that we align with the FDA that, that's the right cell line to take forward. It's been hard. It's been really, really hard.

Maybe speak to how 451 is differentiated from the competitors out there from Vertex and CRISPR.

I'm going to start by saying, I wouldn't focus very much on competitors. Just -- and not because they're not good, but it's going to be a competitive stick because if you just take your most idealistic thinking, which is the company somehow makes 100,000 patients of drug per year, right? And that would be spectacular. And if you put some reasonable price on that, you can see that's a gigantic business, right? I mean if you pick one cystic fibrosis treatment from Vertex alone, that would be over $40 billion a year revenue number, right?

So you do 100,000 patients per year and you do that for a decade, you will have treated around 10% of type 1 diabetics. And by 2040, it will be about 7%, right? And you won't be treating -- you'll just be at a level where you're able to treat the incidence population, let alone all the prevalence pool that you have to deal with. So I think we have to get our own knitting straight. And if competitors emerge, that's great. But to date, what it differentiates our program from others is we get rid of immunosuppression, right?

So every other program requires some type of immunosuppression to hide the cells from immune rejection. And I think that, that could offer a tremendous benefit for some patients. it's unlikely to be as broadly acceptable. I've never met a patient who doesn't -- with type 1 diabetes or person with type 1 diabetes, if this works like we hope it does, doesn't want this therapy. I've met very few who want to take life-long immunosuppression, right?

And so I'm presuming that all of these people will figure out their own way to go after and get rid of immunosuppression, and it will be a competitive market like almost every other field is. But right now, we have a multiyear advantage on everybody on the planet on a gigantic market, which is when we think about all these other areas where you say you worry about competition from 14 different modalities, 13 different targets, 12 different companies, U.S., China, we get the privilege right now and the burden and responsibility of having a really differentiated therapeutic.

Pivoting to the autoimmune disease vertical. Walk us through, one, what you've seen on the oncology side that lends confidence to the autoimmune approach, recognizing that there's been a good amount of data from the field in general. And then secondly, what we should expect from the upcoming data set release?

So before we leave type 1 diabetes, I want to say one last thing. This will work. All the boxes have been checked. Again, we have to make it work for us, but this will work for patients. There are 3 main risks for us. One is capital and time. Two is safety. Safety is a really big risk, which is why we spend so much time on the genomics and on the manufacturing for product purity because you can't have emergence of tumors. So these patients otherwise won't live for decades. And the third is we have to figure out scale, right? We're not there yet. So those are 3 big things. just to think about.

So now let's transition to the allogeneic CAR T program. So take a step back. The -- I think most people recognize that autologous CAR T cells, which are made from a patient's own cells have had a tremendous impact in patients with lymphoma, leukemia, multiple myeloma. Increasingly, it looks like they will have a really a great impact for patients with a host of autoimmune disorders. And the number of autoimmune disorders that they should have a benefit on is probably about 50 to 75. And so they're very broadly utilizable for a host of different patients.

What we know in the -- sorry, the autoimmune setting to date is that what you're really looking for, I think of it as a control alt delete of the patient's B-cell repertoire or their ability to make antibodies. And so you want to knock every single B cell out of the patient and then let them come back. But you can't knock out most likely 20% or 70% or 80% or just circulating B cells, the ones you see in your blood, because only about 2% of your B cells are actually in your blood. You have to get tissue resident memory B cells or plasma blast or you're probably not going to get that control alt delete.

But if you get control alt delete, hopefully, you get rid of all the pathologic B cells. That's kind of the goal of these therapies. And then you would like to let the immune system come back and hopefully, the patient goes on and lives a very normal life from there. So the -- what we know from our studies in the oncology setting, right? So we use this drug in a host of patients is that, one, it's well -- safe and well tolerated. Two, is we can scale it. We make hundreds of patient doses per manufacturing batch.

And three, and this is the most important is that we get a dose-dependent B-cell depletion, right? And so -- a deep B-cell depletion. So what we saw in oncology at low doses was very few patients, if you had the deep B-cell depletion. As we got the higher doses, every patient had deep B-cell depletion. And so that gives us optimism that we should see the same thing in autoimmune.

The fourth thing we learn in oncology is that when you look just kind of at self the number of the dose. The dose is a bit higher than it was in the autologous setting, which means that just we have to go through the dose escalation in our -- with our allogeneic CAR T cells and slower than I hoped it would be just because you got to get to a higher dose than where we started.

So what should we expect? I think, again, we know that this drug has some therapeutic benefit. And so I think the real question is, is it okay, good or great. And to me is, okay, is -- it's pretty good, right? It's got some clinical benefit, maybe it competes with the T cell engagers, but it's not quite as good as the autologous CAR T cells. Good is it competes with autologous CAR T cells, and we look pretty similar, and we've got the scalability and an ability to offer patients an off-the-shelf therapy that's available tomorrow without having to taper on and off of their immunosuppressant several times and grade is we're better, right?

And so I think that's really the framework that I look at this from is how do you compare to what is a very dynamic and competitive field, right? I mean the challenge with, I think this field is there are -- you have multiple targets. Once you get the target right you have multiple modalities, right? You have CAR T cells, NK cells, T cell engagers, ADCs, antibodies. And once you get the target and the modality right, you have multiple companies.

And so figuring out where we fit into a very competitive landscape is going to be the question that comes out of these data. And if we don't think it's very compelling data, we will not move forward with it. I mean the internal rate of return, I think on a risk-adjusted basis in type 1 diabetes is spectacular. And so we have to justify any capital we're spending in other areas with a very high bar. I mean, no guarantees type 1 diabetes works. I mean, I think there's some -- I mean, go to the safety issues we talked about and we could scale it, but that's where our capital should be going.

And what about the strategy with your CD22 CAR T, which is going to be used in the post-CD19 setting? Just curious on the back of actually some interesting data at ASCO where we saw data from a dual CD19, CD20 CAR T. Just curious how you're thinking about where CD22 target being employed kind of plays a role here.

Yes. So I'd just start -- what's amazing if you look at multiple myeloma is you go back 15, 20 years ago and a patient who was diagnosed and they could expect to live 15 to 18 months. And today, a patient is diagnosed and they can expect to live 15 to 18 years, right? And one of the reasons that's occurred is because there have been a host of different modalities, a host of different targets and patients are able to serially work their way through many, many modalities and therapies. The same will be true in lymphoma and leukemia, right? There isn't going to be a single magic bullet.

I think if there is going to be a single magic bullet, it would be something like a dual-targeted CAR T cell. So I mean those are very smart to develop. But it's more likely it's going to be serial for patients. And so -- again, I think the most important thing for us in something like this is to understand what the deal with our own knitting, right, and what we can do. I do think CD22 has become more complicated. I think you know there was a company called Cargo that had CD22 targeted autologous CAR T cell where they had very compelling Phase I data and the Phase III data were less interesting, right? Very early and robust high levels of responses that didn't last very long.

I think that makes it -- there are reasons that likely they ran into challenges. They changed the patient population, they changed the drug product, and it may be something about CD22. I think the hard part for us is we have to see at least 6-month data at scale, right? The number of patients understand are really different. And so that's going to be a high bar for us to keep moving that forward. again, just given all the competing priorities within the company and the necessity to see, I think, long-term durable complete responses to be clinically valuable. And I think that's a different place in lymphoma, where with CD19, where we see very few recurrences after 3 months. Now here, they're basically -- the majority of patients recurred between 3 and 6 months. So we have to get a lot of data to understand what we have.

One last question, Steve. With regard to balance sheet here, how are you thinking about partnerships and the ability to kind of fund all these programs through development. I think you talked about possible licensing deals as a non-dilutive option, maybe expand for us where you're thinking of what you're actively exploring and what your strategy is here?

So we can't -- we need more money. We can't develop all these drugs in any reasonable scenario ourselves. And so those things are both true. In almost any scenario, we will protect this type 1 diabetes franchise. We will ensure we have the capital to go forward. We may be able to do that without a partnership for a while. If someone came forward with a really compelling partnership where our shareholders retained a good bit of value or the value and where we thought it improved the probability of success, we think about it, but I think it's a super, super, super high bar.

For the other programs in the company, whether that's allogeneic CAR T cells or we didn't talk really about the in vivo CAR T cells, I think that it's unlikely our shareholders are going to pay for them in any meaningful way over the next year or 2. And so that means that we need a partnership to continue to justify investing in them. And I think that, that is doable in the allogeneic CAR-T space, but complicated.

And it will be -- it's relatively straightforward for the in vivo delivery, but not completely straightforward. I think there we have to think about, do we find the capital ourselves. Do we slow it down a little bit until the company is going to build a better place? Do we partner it? Or could we spin it in a new company?

And I think all 4 of those are always going to be on the table until we decide what to do. But that is one where the in vivo delivery of genetic material in a cell-specific way, if we get that right as a platform in and of itself, right? And you can make many, many different drugs from that. And so we'd like to find a way to ensure that we test it in people before we make any dramatic decision, right.

Great. With that, Steve, thank you so much.

Thank you, Salveen, and thank you, everybody, for your time and attention.