Vertigo3d
I have a small stake and high hopes in REGENXBIO (RGNX), however RGNX stock has consistently failed to perform. From my last article in May, the stock is down 26%. The latest fall came after they announced “positive” interim data two days ago from their “Phase II AAVIATE® trial of ABBV-RGX-314 for the treatment of wet age-related macular degeneration (wet AMD) using suprachoroidal delivery.”
Brief background here: RGNX is a developer of AAV (Adeno-associated virus) gene therapeutics for eye diseases. Their three clinical stage assets are 1) RGX-314 for wet AMD (partnered with AbbVie Inc. (ABBV), now called ABBV-RGX-314), 2) GX-202 in Duchenne Muscular Dystrophy, and 3) GX-121 in Hunter syndrome. Of these, RGX-314 has two delivery modes being tested, the subretinal (SR) mode in the ATMOSPHERE trial, and the next generation, more convenient suprachoroidal (SC) mode in the AAVIATE trial. Also, they have an SC program in diabetic retinopathy in the ALTITUDE trial. The SR and the Hunter syndrome trials are in phase 3; the others are all in phase 2 stages.
The data we are going to discuss is from AAVIATE. You need to read the following description of the trial’s doses and cohorts to follow this:
This phase 2, randomized, dose-escalation study is designed to evaluate the efficacy, safety and tolerability of RGX-314 gene therapy in subjects with nAMD. Approximately 115 participants who meet the inclusion/exclusion criteria will be enrolled into one of 6 cohorts. Participants will be randomized in Cohorts 1 and 2 to receive RGX-314 or ranibizumab control, and participants enrolled in Cohorts 3 through 5 will receive RGX-314. Participants enrolled in Cohort 6 will receive RGX-314 and will be randomized to one of two different post-procedural steroid regimens. Cohort 1 will evaluate RGX-314 Dose 1, Cohorts 2 and 3 will evaluate RGX-314 Dose 2, and Cohorts 4, 5, and 6 will evaluate RGX-314 Dose 3. Participants will be evaluated for efficacy, safety and tolerability of RGX-314 throughout the study.
Data is from dose 3. About this particular dose, here’s the data:
20 patients in Cohort 1 and 20 patients in Cohort 2 were randomized to receive RGX-314 at a dose level of 2.5×10(11 – indicates power) and 5×10(11) genomic copies per eye (GC/eye), respectively, versus monthly 0.5 mg ranibizumab intravitreal injection at a 3:1 ratio. Cohort 3 is evaluating RGX-314 at the same dose level as Cohort 2 in 20 patients who are neutralizing antibody (NAb) positive.
So dose 3 is 5×10(11) genomic copies per eye (GC/eye) in patients who are NAb positive. These NAbs are against the AAV delivery vehicle and may imply that, a) the patient has been previously exposed to therapy, and b) there may be additional effects from the NAb with respect to safety or efficacy or both.
Here’s a detailed description of each dose and cohort:-
Dose 1 – 2.5×10(11) GC/eye, given to cohort 1 to 15 NAb- patients, 5 patients in control doses with Ranibizumab
Dose 2 – 5×10(11) GC/eye, given to 15 patients in cohort 2 that are NAb-. Ranibizumab control n=5; AND given to 20 NAb+ patients in cohort 3. Subjects in Cohort 2 received two doses of 100µL, all other cohorts received one dose of 100µL.
Dose 3 – 1.0×10(12) GC/eye, given to 15 NAb- patients in cohort 4 and 20 NAb+ patients in cohort 5. An additional cohort 6 was later enrolled with 20 patients regardless of NAb status who were given Prophylactic ocular steroids.
Thus, dose 3 is twice dose 2, dose 2 is twice dose 1. Data presented in July last year showed no difference in safety whether patients were NAb positive or negative. Key side effects were Intraocular Inflammation, Conjunctival Hemorrhage, Intraocular Pressure Increased, Conjunctival Hyperemia and Episcleritis in 15, 11, 9, 7 and 7 patients respectively. They also produced data from cohorts 1 to 4.
Data from July was for 6 months from cohort 1-4 in 65 patients. Data showed this:
ABBV-RGX-314 treated patients had stable vision and retinal thickness, with a meaningful reduction in treatment burden across all dose levels; highest reduction in treatment burden seen in Cohort 4 (Dose 3):
No meaningful differences in patient outcomes with and without baseline AAV8 NAbs
Intraocular inflammation (IOI) resolved with topical corticosteroids
Cohorts 1-3 (Dose 1 and 2) – all mild and similar incidence observed across doses
Cohort 4 (Dose 3) – mild to moderate with increased incidence compared to prior doses
Cohort 6 (Dose 3) initial safety results: zero cases of IOI with short-course prophylactic topical steroids (n=10)
Now, with all that background in mind, let’s see what they said on Jan 16 that tanked the stock.
These are the summary points from the press release:
ABBV-RGX-314 continues to be well tolerated in over 100 patients from three dose levels with no drug-related serious adverse events
ABBV-RGX-314 in over 50 patients at third dose level demonstrated highest reduction in treatment burden:
Zero cases of intraocular inflammation observed in patients that received short-course prophylactic topical steroid eye drops
What we immediately observe is that 67% of patients were injection free in July, which has now come down to 50%. There’s a decrease of 5% in the annualized injection rate. There is no other major difference within the press release or in the publication. There are changes in AE figures, which are to be expected given the earlier data cutoff was from August 2022, and this one was from November 2023. Broadly, though, it is nice to see that topical PPX (prophylactic steroids) completely eradicated intraocular inflammation. Patients have very little problem with such oral drops, as the company’s KOLs said in the conference call.
Other news
Lawsuit – On January 8, a District Court in Delaware granted “summary judgment on invalidity in a patent infringement suit arising from Sarepta’s manufacture and use of cultured host cell technology covered by a University of Pennsylvania (PENN) patent that Sarepta uses to make clinical and commercial supplies of SRP-9001 (also known as ELEVIDYS in the U.S.), for itself and Roche, for the treatment of Duchenne muscular dystrophy.” That means, Sarepta won the patent suit, filed by RGNX/UPenn last year over an expired patent, U.S. Patent No. 10,526,617 (‘617).
Diabetic retinopathy – The update from November 2023 reveals continued positive outcomes with well-tolerated effects in 50 patients across dose levels 1 and 2 (Cohorts 1-3), with no drug-related serious adverse events reported. At dose level 2, the treatment demonstrated efficacy by preventing disease progression and reducing vision-threatening events in non-proliferative diabetic retinopathy patients over one year. Specifically, 70.8% of patients achieved improvement in the Diabetic Retinopathy Severity Scale, a notable increase compared to the 25.0% observed in the control group. Moreover, none of the patients worsened by two or more steps, contrasting with the 37.5% deterioration rate in the control group. ABBV-RGX-314 exhibited a substantial 89% reduction in vision-threatening events compared to the control group.
Duchenne – RGX-202 remains well-tolerated in three patients at dose level 1 (1×10^14 GC/kg). Initial biomarker data in two patients completing the three-month assessment indicate robust microdystrophin expression localized to the muscle cell membrane. A 4.4-year-old patient exhibited expression at 38.8% of the control level. The trial plans to escalate the dose by the end of 2023, with pivotal dose determination and program initiation expected in 2024. The RGX-202 microdystrophin will be used as a surrogate endpoint to support a Biologics License Application filing via the accelerated approval pathway.
Financials
RGNX has a market cap of $671mn and a cash balance of $365mn. Revenues were $28.9 million for the three months ended September 30, 2023, primarily from ZOLGENSMA royalty, which uses their NAV technology. The company announced a restructuring plan, including a 15% reduction in workforce, which is expected to result in total savings of at least $100 million. Research and development expenses were $58.2 million for the three months ended September 30, 2023, while general and administrative expenses were $23.1 million. At that rate, they have a cash runway of 4 quarters.
Bottomline
I hope this detailed discussion has identified the problem with RGNX, and why this stock keeps going down despite such seemingly – no, obviously – robust data. The reason is this – they have this terribly confusing, inordinately exhaustive set of trials, which seem to go on and on, as if their R&D department keeps having new ideas and wants to test them out. They have this academia-oriented, lab-research based mindset, while investors are dying to hear words like “pivotal,” or “registrational,” or, even better, “PDUFA.” There seems to be no such plan. The company does not tell us when these endless trials will end and we will get to meet the FDA.
I am confident that when that happens, this stock will go up hugely. They have a one-year deadline – 4 quarters – before that happens, because that is when their large cash balance will end, and the market will be plenty unforgiving if they try to raise cash without saying “FDA.” Their R&D expenses are huge, and workforce reduction alone is not going to help. They need to get to the market with their own product as soon as possible. I will continue buying at dips.
