Taysha: Produces Solid Data Then Abandons Programs (TSHA)

Taysha Gene Therapies, Inc. (NASDAQ:TSHA) has the first gene therapy in the clinic targeting Rett syndrome. This program has excellent early data. However, what worries me is that they used to have three other programs which also had excellent early data. But they abandoned these programs after taking them through some trials. One of these, TSHA-120, was abandoned after the FDA asked them for a more robust trial. I thought the FDA’s request was logical, and they should have carried TSHA-120 through those trials. This repeated lack of tenacity is worrying.

At that time, TSHA had good data and a major partnership, but after a Type B end-of-phase 2 meeting with the FDA went south, the stock lost its glitter. This happened in February last year, just when I was covering the stock. Sometime in the middle of 2023, TSHA stock more than tripled, regaining NASDAQ compliance based solely on solid data, from the lows of February. The stock has now gone back to those earlier lows, prompting another look from me at this undercovered stock.

TSHA was launched in 2020 to develop monogenic gene therapies for CNS diseases. By early 2023, TSHA’s brief clinical history could be summed up like this: two early clinical data successes from two different programs in Angelman Syndrome and CLN7 disease, now abandoned; first real clinical data in January 2022 from the high dose cohort for TSHA-120 in giant axonal neuropathy, or GAN (this program has also now been abandoned; more on that soon). An emerging partnership with Japanese giant Astellas is now in limbo. One program, TSHA-102 in Rett Syndrome, now remaining.

Here’s how the pipeline looks right now:

On that same pipeline page, the company also states:

We have deprioritized the company-sponsored evaluation of TSHA-120 for GAN, TSHA-118 for CLN1, and TSHA-105 for SLC13A5 and are seeking external strategic options to potentially enable further program development.

Thus, as I was saying, this is a company barely managing to hang on to its existence. After three abandoned programs – this despite early positive data – something is really amiss with their business strategy. What happens with 102 remains to be seen, but past history does not evoke hope.

It is not like their earlier data wasn’t good. The GAN data was good enough to convince Astellas to pay them $50mn upfront for a 15% stake. That data showed a 13-point improvement in the change in the rate of decline in MFM32 score by year 1 compared to natural history data. This was a long-duration trial, and by year 3, the mean change in MFM32 was a 10-point improvement for all therapeutic dose cohorts, compared to the estimated natural history decline of 24 points – a 34-point difference. There are very few patients and even fewer clinical trials for this disease, but that does not hide the fact that this solid data was proof of TSHA’s monogenic gene therapy platform.

Like I noted earlier, the FDA suggested a double-blind, placebo-controlled design for additional dosing. The FDA has problems with the “heterogeneity of disease progression in GAN and the effort-dependent nature of MFM32 as a primary endpoint in an unblinded study.” By September, after a Type C meeting with the FDA, the decision to abandon this program was finalized. Astellas, too, chose not to exercise its option for 120 – which was almost a certainty already. The company stated that the “decision to discontinue further development of the program [was] due to challenges related to the feasibility of the study designs.”

That has left them with TSHA-102 only. In May, the company presented safety data from a preclinical mouse model trial, which showed that 101 “avoided toxic overexpression of MeCP2 within cells already expressing MeCP2.” By June, the company had dosed the first patient in a phase 1/2 trial of TSHA-102 in adult patients with Rett Syndrome. This was a randomized dose-escalation and dose-expansion study.

About 102, the company notes:

TSHA-102 is a self-complementary intrathecally delivered AAV9 investigational gene transfer therapy that utilizes a novel miRNA-Responsive Auto-Regulatory Element (miRARE) platform designed to regulate cellular MECP2 expression.

It is also the first gene therapy targeting Rett Syndrome in the clinic. It consists of a single dose administered intrathecally in the lumbar region.

In August, the company produced data from the first patient dosed. Data showed the following:

Data from first adult patient dosed in REVEAL Phase 1/2 trial showed TSHA-102 was well-tolerated with no treatment-emergent serious adverse events (SAEs) as of six-week assessment and improvement in key efficacy measures, including Clinical Global Impression – Improvement (CGI-I), Clinical Global Impression – Severity (CGI-S) and Rett Syndrome Behavior Questionnaire (RSBQ), four weeks post-treatment

Principal Investigator (PI’) observed clinical improvement in multiple domains, including autonomic function (sleep and breathing), vocalization, as well as gross motor skills (gained ability to sit unassisted for three minutes) and fine motor skills (gained ability to hold objects), supported by initial clinical data and video evidence

This data took the stock up hugely in August. The data is interesting, as the company notes that “these early data indicate that the miRNA-Responsive Auto-Regulatory Element (miRARE) technology is mediating MECP2 expression in the CNS on a cell-by-cell basis.” MECP2 (Methyl-CpG-binding protein 2) is a gene located on the X chromosome, specifically at Xq28. Mutations in the MECP2 gene are associated with Rett syndrome, a neurodevelopmental disorder that occurs in girls. miRNA refers to microRNA, which are small RNA molecules that play a crucial role in the regulation of gene expression. MicroRNAs can bind to specific messenger RNA (MRNA’) molecules, leading to the degradation of the mRNA or inhibiting its translation, thus influencing gene expression.

The solid data also made successful a large, $150mn private placement (PIPE), led by RA Capital Management, with participation from a large institutional investor, “PBM Capital, RTW Investments, LP, Venrock Healthcare Capital Partners, TCGX, Acuta Capital Partners, Kynam Capital Management, LP, Octagon Capital, Invus, GordonMD® Global Investments LP, and B Group Capital.”

The company presented a poster on this early data in. Although I am unable to find an abstract on the Meeting website, I found a video interview of the CEO Dr. Sukumar Nagendran from December which discusses this “remarkable” gene therapy data. I also did find an abstract elsewhere:

Poster 056

Early Safety and Efficacy Observations Following the First Use of TSHA-102 Gene Therapy in Patients with Rett Syndrome

E ROSSIGNOL1, I MEIJER1, J DOWNS2, N DEVIDZE3, E SQUIERS3, V OSWALD3, E TESFAYE3, R HAQUE-AHMED3, S NAGENDRAN3, B MARU3, B SEREMULA4

1Université de Montréal, Montréal, Canada; 2University of Western Australia, Nedlands, Australia; 3Taysha Gene Therapies, Dallas, USA; 4Atorus Research Inc., Philadelphia, USA

Objective: To describe the early clinical response to TSHA-102 in the first two individuals to undergo Rett syndrome (RS’) gene therapy.

Methods: Per the REVEAL Adult (NCT05606614) protocol, Participant 1 received immunoprophylaxis beginning on Day −7, with TSHA-102 injected intrathecally on Day 0. Her case underwent an Independent Data Monitoring Committee (IDMC) review on Day +42.

Results: Participant 1 is a 20-year-old woman diagnosed with RS at age 3. She has been unable to sit or stand without support since age 8. Following amygdalectomy, her seizures are generally controlled, despite occasional breakthroughs, for example when her blood phenytoin reaches <100 micromol/L. Vital sign changes following treatment were unremarkable. Treatment-related adverse events included: an episode of mild pyrexia on Day +1 (deemed TSHA-102-related), managed with acetaminophen, resolving in <24 h; and mild irritability starting on Day +5 (prednisolone-related). No serious adverse events occurred, irrespective of causality. By Week 2, caregiver reports suggested clinical improvement. Week 4 clinical global impression change scores from physicians (CGII’) and caregivers (PGIi) were rated ‘Much improved’ and ‘A little better’ respectively. RS Behavior Questionnaire (RSBQ) score showed a 23-point improvement over baseline whereas the Revised Motor Behavior Assessment (R-MBA) showed no significant change. Among other RSBQ subscore improvements, ‘Night-time behaviors’ declined from 3 to 0 points, consistent with caregiver reports that the participant was now sleeping peacefully all night. By Day 35, the Participant regained the ability to sit for up to 3 mins, unassisted. Finally, whereas two seizures were recorded over Days −10 to 0, none occurred between Days +1 and + 35, despite low blood phenytoin.

Conclusions: Because Participant 1 experienced no dose-limiting toxicities, the IDMC approved the continuation of REVEAL Adult. Updated clinical data on Participant 1 will be reported, along with early observations on Participant 2.

This seems to be the actual poster, although the presenter is (obviously) different from the authors. The data is very positive, with strong improvement seen at week 4 from a single dosing and with few side effects.

Financials

TSHA has a market cap of $288mn and a cash reserve of $164mn as of September. This figure includes the $150 million PIPE from August but not the $40 million loan they received from Trinity Capital in December. Research and development expenses were $11.8 million for the three months ended September 30, 2023, while general and administrative expenses were $8.6 million. At that rate, they have a cash runway of 8-9 quarters, or well into 2026. They probably have sufficient funds to complete TSHA-102’s clinical program.

Bottom line

I used to be interested in TSHA, but the company has this strange habit of abandoning promising programs. TSHA-102, the first Rett syndrome gene therapy, has excellent early data and needs to be seen through a pivotal trial. I’m curious if they can see it through.