REGENXBIO Inc. (RGNX) Q3 2018 Earnings Report, Transcript and Summary

Good day, ladies and gentlemen, and welcome to the third quarter 2018 REGENXBIO earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions]. As a reminder, this conference may be recorded. I would like to introduce your host for today’s conference, Mr. Patrick Christmas, Senior Vice President and General Counsel. Sir, please go ahead.

Good afternoon and thank you for joining us today. With us today are Ken Mills, REGENXBIO's President and Chief Executive Officer; Stephen Yoo, our Chief Medical Officer; and Vit Vasista, our Chief Financial Officer. Earlier this afternoon, REGENXBIO released financial and operating results for the three months ended September 30, 2018. The press release reporting our financial results is available on our website at www.regenxbio.com. Today's conference call will include forward-looking statements regarding our financial outlook in addition to regulatory and product development plans. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted and can be identified by words such as expect, plan, will, may, anticipate, believe, should, intend and other words of similar meaning. Any such forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties. These risks are described in the Risk Factors and the Management's Discussion and Analysis section of REGENXBIO's quarterly report on Form 10-Q for the quarter ended September 30, 2018, which is on file with the Securities and Exchange Commission and available on the SEC's website. Any information we provide on this conference call is provided only as of the date of this call, November 7, 2018, and we undertake no obligation to update any forward-looking statements we may make on this call on account of new information, future events or otherwise. Please be advised that today's call is being recorded and webcast. In addition, any unaudited or pro forma financial information that may be provided is preliminary and does not purport to project financial positions or operating results of the company. Actual results may differ materially. I would now like to turn the call over to Ken Mills, President and Chief Executive Officer of REGENXBIO.

Thank you, Patrick. And good afternoon, everyone. Thanks for joining us. Today's conference call will provide a recap of our recent progress, including the start of patient dosing in our neurodegenerative franchise and a recap of interim trial results from the RGX-314 clinical trial presented at the American Academy of Ophthalmology. Vit will provide an update on financial results for the third quarter of 2018. We will also review anticipated upcoming milestones for REGENXBIO and then open the call to questions. At REGENXBIO, our mission is clear. We aim to improve the lives through the curative potential of gene therapy based on our proprietary NAV Technology Platform. Our NAV Technology Platform consists of over 100 novel adeno-associated viral vectors, or AAV vectors, including AAV7, AAV8 and AAV9. Our AAV gene therapy product candidates are designed to be single administration therapies that deliver genes to cells to address genetic defects or that enable cells in the body to produce therapeutic proteins that are intended to impact disease. Our product candidates are designed to provide long-lasting effects for patients with significant unmet medical needs, potentially changing the course of the disease, delivering improved patient outcomes. We’re currently advancing an internal pipeline to address retinal diseases, metabolic diseases and neurodegenerative diseases. These areas of focus have been strategically selected because we believe they can be uniquely addressed by our vectors. Within each of our focus areas, there are many diseases with significant unmet medical need. Beyond our internal development programs, we selectively license components of our NAV Technology Platform, most typically single AAV vectors for single indications to third-party companies whose vision and commitment to gene therapy is aligned with ours. I want to emphasize for us that this work is about more than just our technology platform. While our company in the field of AAV gene therapy have grown and evolved, there's one constant that will never change, and that's our commitment to patients. Our ultimate goal is to address unmet medical needs and we’re optimistic about the progress being made to improve lives through gene therapy. We actively engage with patient advocates to ensure an understanding of the patient experience, and these insights guide development each of our product candidates. We strive to be a reliable and compassionate partner to these patients as we believe single administration gene therapy treatments that significantly alter the course of disease could transform the lives of those facing serious disease. I will now turn it over to Stephen for a presentation of updated interim trial results and development updates for our lead product candidates.

Thanks, Ken. I'll begin today with our RGX-314 program for the treatment of wet AMD and review data shared at AAO in October 2018. As a quick reminder, wet AMD is a disease affecting more than 2 million patients in the US, Europe and Japan, and usually requires frequent anti-VEGF therapy to prevent vision loss. Continual long-term therapy with anti-VEGF injections is a burden to the patient and families affected. Many patients struggle to comply with the recommended therapeutic regimen for current anti-VEGF therapies. And lack of compliance can lead to under treatment and, ultimately, vision loss over time. RGX-314 utilizes the NAV AAV8 vector, which encompasses the gene that is introduced into the retinal cells to impose a long-term continuous expression of the therapeutic anti-VEGF protein. The expressed anti-VEGF antibody fab neutralizes VEGF activity in a continuous fashion after a single administration. The NAV AAV8 vector has been selected for this product candidate because it has demonstrated effective transduction of retinal cells and the ability to produce high levels of therapeutic protein in multiple preclinical animal models. We're pleased that the updated interim study results presented by Dr. Jeff Heier at AAO in October 2018 demonstrated that protein expression levels from the 6 x 10^10 genome copies per eye dose cohort, our third dosing cohort, were sustained at six months. We continue to follow subjects in the Phase I trial, and it is encouraging that these subjects showed durable protein expression from month one to month six. We had also announced previously that we are expanding the Phase I clinical trial to add an additional dosing cohort for further evaluation of RGX-314. In September 2018, REGENXBIO announced the completion of dosing of this additional cohort at the higher dose of 1.6 × 10^11 genome copies per eye. A total of 24 subjects have now been treated with RGX-314 to date. Planning for the next phase of development continues to progress and the next program updates for RGX-314 are expected in early 2019. I would now like to turn our focus to our program MPS I and II. As a reminder, MPS I and MPS II are lysosomal storage disorders caused by defects in the IDUA and IDS genes respectively. While there are approved and marketed enzyme replacement therapies, these therapies are for the treatment of the systemic symptoms of both MPS I and MPS II, but do not address the CNS symptoms which are associated with the most severe forms of MPS I and MPS II. Our programs are designed to address this area of significant unmet medical need by utilizing the NAV AAV9 vector through a one-time administration approach that will be administered directly into the cerebrospinal fluid via intracisternal administration. Today, we announced that the first subjects in our RGX-121 program was dosed at the Children's Hospital in Pittsburgh by a medical team led by Dr. Maria Escolar. Dosing of the first subject in this Phase I/II clinical trial is a significant milestone as we advance RGX-121 in order to improve the lives of patients suffering from MPS II. We continue to focus on additional subject recruitment and site activation. Next program updates are expected in 2019. Subject recruitment continues in the Phase I clinical trial, evaluating RGX-111 for the treatment of MPS I. Under the current FDA protocol, recruitment is focused on an initial subject over 18 years of age. In an effort to further the development of RGX-111 in areas of the world where there's a high unmet need for the treatment of MPS I, REGENXBIO has submitted an application to the Brazilian Health Surveillance Agency, ANVISA, to proceed with a Phase I clinical trial evaluating RGX-111 for the treatment of MPS I in patients under the age of three. We expect this will allow us to activate an initial site in the first half of 2019. As a result, dosing of the first subject in a clinical trial evaluating RGX-111 is now expected to occur in the first half of 2019. Turning to our metabolic franchise, I’d like to update our RGX-501 program for the treatment of homozygous familial hypercholesterolemia. HoFH is a rare genetic disorder caused by mutations in the gene encoding the low-density lipoprotein, or LDL, receptor. Our RGX-501 has the potential to address the underlying genetic defect responsible for HoFH by correcting the LDL receptor deficiency. In October 2018, an update of interim results from the Phase I/II clinical trial were presented by Dr. Marina Cuchel during a poster session at the American Society of Human Genetics 2018 Annual Meeting. As we previously shared, the current clinical trial protocol is expected to be amended to enroll additional subjects using steroid prophylaxis and the next program updates are expected in early 2019. Finally, in August 2018, REGENXBIO announced a new lead product candidate program called RGX-181. The program aims to develop a one-time treatment to halt progression of late infantile neuronal ceroid lipofuscinosis Type 2, or CLN2 disease, one of the most common forms of Batten disease, a rare pediatric neurodegenerative disease. We continue to perform preclinical work to advance RGX-181 to clinical trials with IND submission expected in 2019. We are excited about the continued progress in all our lead candidate programs and look forward to sharing more updates with you as milestones are achieved and throughout 2019. With that, I will turn the call back over to Ken to discuss additional progress on building our capabilities and our licensee programs.

Thanks, Stephen. We are very encouraged by these updates and the progress we continue to make as we develop our lead product candidates. But beyond our internal progress, the NAV Technology Platform continues to advance through the efforts of our licensed external partners and our technology is currently being employed in the development of more than 20 partner product candidates by NAV Technology Platform licensees, 14 of which have advanced to clinical stage, and one of which has been submitted for BLA approval. As licensee programs progress and achieve efficacy and safety milestones, we believe they further validate the versatility of the NAV Technology Platform and provide additional data that collectively drive the advancement of the AAV gene therapy space. The strength of the NAV Technology Platform was recently highlighted by Novartis' announcement of simultaneous global marketing application submissions in the US, Europe and Japan for AVXS-101 for the treatment of Type 1 SMA based on Phase I data and select data from ongoing Phase III study. Novartis is planning to launch AVXS-101 in the middle of 2019, representing potentially the first approval for a NAV gene therapy product candidate. AVXS-101 uses the NAV AAV9 vector. We’re very encouraged by Novartis’ rapid global filing of these marketing applications and believe AVXS-101 will represent the first of potentially many marketed products based on the NAV Technology Platform. And the broad reach of the platform is underscored by numerous additional NAV Technology licensees entering and advancing in the clinic, as well as announcing exciting preclinical data and electing to pursue additional indications based on the NAV Technology Platform. This week, we added Abeona Therapeutics as a NAV Technology licensee by entering into a license for the development and commercialization for lysosomal storage disorders using the NAV AAV9 vector. From this relationship, REGENXBIO could receive up to $120 million in upfront and annual payments under the license agreement, $40 million of which is guaranteed. And the company is eligible to receive potential commercial milestone payments of up to $60 million in addition to sublicensees and low double-digit royalties on net sales of products. Last month, Ultragenyx, another NAV Technology license partner, announced that it exercised its option to develop a gene therapy to treat patients with CDKL5 deficiency disorder using the NAV Technology Platform, including AAV9. In parallel with these advancements, we’ve continued to strengthen our team and the capabilities at REGENXBIO in a number of important ways. In Q3, we completed the buildout of our new state-of-the-art research and development facility, which is now fully operational. We’re excited to have a consolidated facility for growing research, early development group and our process development group and manufacturing teams. In addition, with an eye towards continued expected future growth, we recently entered into a lease for a new 130,000 square-foot office laboratory and manufacturing headquarters near our current sites in Rockville, Maryland. The project will provide us with long-term space for co-located corporate headquarters, research and development, and commercial scale cGMP manufacturing. The new building is expected to be fully operational in 2020 and we’re confident that we now have the facilities in place to support both our near and long-term plans. In summary, it's been a very productive third quarter, with meaningful advancement of internal and externally partnered product candidates, while progressing towards our goal of bringing novel gene therapies through the clinic and, ultimately, to patients. With that, I'm now going to turn the call over to Vit for a review of the financials.

Thank you, Ken. REGENXBIO ended the quarter on September 30, 2018 with cash, cash equivalents and marketable securities totaling $474.9 million as compared to $176.4 million as of December 31, 2017, an increase of $298.5 million. Cash, cash equivalents and marketable securities as of September 30, 2018 included $189.1 million of aggregate net proceeds from our follow-on public offering of common stock completed in August 2018. Revenues were $5.3 million through the three months ended September 30, 2018 compared to $1.3 million for the same period in 2017. The increase was primarily attributable to $4 million of license revenue recognized during the quarter ended September 30, 2018 as a result of development milestones achieved or deemed probable of achievement by NAV Technology licensees during the period. Research and development expenses were $18.5 million for the three months ended September 30, 2018 compared to $12.5 million for the same period in 2017. The increase was primarily attributable to increased headcount, laboratory and facilities cost, and expenses associated with conducting clinical trials and externally-sourced manufacturing related services. General and administrative expenses were $9 million for the three months ended September 30, 2018 compared to $9.4 million during the same period in 2017. The decrease was primarily attributable to professional fees for advisory services, and was partially offset by an increase in personnel costs as a result of increased headcount. Net loss was $19.2 million or $0.56 per basic and diluted common share for the three months ended September 30, 2018 compared to a net loss of $20.7 million or $0.67 per basic and diluted common share for the same period in 2017. As of September 30, 2018, we had 35.7 million common shares outstanding, which included 3.1 million shares issued in connection with our follow-on public offering of common stock completed in August 2018. Based on its current operating plan, REGENXBIO now expects that its balance in cash, cash equivalents and marketable securities will be between $460 million and $470 million as of December 31, 2018, which would be used to support the continued development of its lead product candidate programs. With that, I will drop the mic, so Ken can provide final thoughts and review our upcoming 2018 milestones.

Thanks as usual, Vit. So, we've been through a lot of information today and in the release. Let's summarize what we discussed. We've enrolled the first subject in our Phase I/II trial for RGX-121 for the treatment of MPS II. In the Phase I clinical trial of RGX-314 for the treatment of AMD, we continue to be encouraged by signals of sustained protein levels at six months in cohort three. Our expansion of the trial to include a cohort four at a higher dose and the completion of enrollment of this cohort and that RGX-314 continues to be well tolerated at all doses. We’ve revised our guidance to the first half of 2019 for the initiation of dosing in the Phase I trial for RGX-111 for the treatment of MPS I and also initiated plans for expansion of the clinical program into Brazil. Our RGX-501 program for the treatment of HoFH and the new RGX-181 program for the treatment of CLN2 form of Batten disease remain on track for further updates in 2019. Novartis has announced simultaneous global submissions of AVXS-101 in the US, Europe, Japan for Type 1 SMA and is planning to launch AVXS-101 in the middle of 2019. AVXS-101 uses the NAV AAV9 vector under license from REGENXBIO. We recently entered into new exclusive NAV Technology licenses with Abeona and Ultragenyx for the treatment of rare genetic neurological conditions, including MPS III, CDKL5 disease and the CLN3 form of Batten disease. These new licenses bring our anticipated 2018 licensing revenue to over $200 million. And we announced the planned relocation of our corporate and R&D headquarters to enable us to continue to meet our needs for growth and talent and capabilities, including the potential for installing our own cGMP production facility. So, we look forward to sharing additional interim updates from the Phase I RGX-314 clinical trial and plans to initiate a Phase II clinical trial for RGX-314, as well as updating you on the continued status and plans for all of our lead product candidates in early 2019. On a final note, today we announced that Stephen Yoo, our Chief Medical Officer, has advised us of his intent to resign on December 31, 2018 for personal reasons. We've initiated a retained search for this role. Stephen will continue to serve as a consultant to REGENXBIO during the transition. Since joining REGENXBIO over four years ago, Stephen has played an integral role in advancing our lead product candidates and leading our clinical activities. Stephen has contributed to establishing REGENXBIO as a leader in gene therapy and we have confidence in the ability of the strong clinical team that he has assembled to continue to advance our product candidates. We wish Stephen all the best for his future endeavors. At REGENXBIO, our mission is to improve lives through the curative potential of gene therapy based on our proprietary NAV Technology Platform. With our innovative science, inspired employees and partners and strong cash position, we are well-positioned to achieve future milestones as we advance therapies for patients with significant unmet medical needs. With that, operator, we will open up the call to questions. Thanks.

Thank you. [Operator Instructions]. Our first question comes from the line of Gena Wang with Barclays. Your line is open. Please go ahead.

Thank you for taking my questions. Just two. First one is regarding the wet AMD program. Can you also mention that the fourth cohort already – enrollment already complete? Just wondering, what is your goal, the percentage injection sparing for this cohort? And for the Phase II, will you go with one dose or two doses?

Thanks, Gena. That's a great question. With respect to the wet AMD program, we did announce that we just completed dosing. And overall, the target product profile of RGX-314 is to significantly reduce the burden of injection frequency of the existing anti-VEGF treatments that are available, as well as what’s emerging with respect to standard of care in development. I think that the RGX-314 program has already demonstrated significant reduction in injection burden, but, more importantly, the focus of this Phase I study has been on protein expression and sustained protein expression. So, first order, what we’re looking for across the cohort three sustained expression and six-month data that we just presented and update coming in 2019 on cohort four are where we’re getting to with respect to protein expression of RGX-314 protein product. I think your second question related to what are our plans and when are we going to update on the Phase II trial, and that’s something that we’ll be talking about more in early 2019.

Okay. And I have one quick follow-up regarding the cGMP manufacturing facility. So, just wondering how much estimate cost to do your own commercial scale cGMP manufacturing? And can you also remind us your current status in terms of manufacturing?

Yeah, Gena. Thanks for that question because I want to clarify here. So, we've entered into a lease for space that will allow us to build a cGMP facility that could be colocated with our R&D and corporate headquarters, but we've not yet made that commitment from a capital perspective to build out that space and we have the option to move that space into the direction of additional offices as well as R&D. And I think we’ve said from, I think, a couple years ago that we relied on a supply chain that's delivered very well based on our process development and manufacturing teams engaging, and in particular with Fujifilm who have been our leading manufacturer for our clinical trials to date and who have capacity at their manufacturing facilities to support us not only we think for late-stage development, but also potentially through commercialization. So, at this time, we like the opportunity to think about bringing additional capacity on, especially in direct – sort of directly adjacent to our R&D and corporate headquarters, but it’s not an absolute commitment. It’s an option that we’re going to have in this new space that we’ve taken to lease.

Okay, great. Thank you very much.

Thanks.

Thank you. And our next question comes from the line of Matthew Harrison with Morgan Stanley. Your line is open. Please go ahead.

Thanks. This is Vikram on for Matthew. So, staying on RGX-314 and the cohort four data expected in early 2019, two questions there. One, could you comment on what kinds of markers we should expect to see presented? And two, given the dose response that’s been observed so far on protein expression, what do you think is a reasonable level to expect? What are your internal hurdles for protein expression with cohort four?

So, thanks, Vikram. Appreciate the question. Making sure I wasn't on mute there when I was listening. So, with respect to cohort four, we haven't decided and we’re still collecting information based on the dosing having just been completed in terms of what updates are going to be available starting in 2019. The approach that we took with the first three cohorts was to present a complete set of data that included everything from, of course, safety and tolerability, which is the primary outcome, but we’re also looking at measures of protein expression, changes in retinal thickness, of course, injection frequency and visual acuity. So, we haven't quite made that decision yet and determination as to when we’ll have all of that data and what data we’ll have at different time points, but we’ll be working on that in the next few weeks coming into early 2019. In terms of the dose response that we’ve seen to date on protein expression and where things could go with the cohort four, I think that's why we’re running the trial, to be able to build the background of our understanding of that pharmacology. And I think that we've been pleased to see dose-dependent increases across the first three cohorts. And so, I think that's laid a good foundation for us to have an expectation to continue to see increases in protein expression, which would be meaningful for this program.

Okay, thank you.

Thank you. And our next question comes from the line of Gbola Amusa with Chardan. Your line is open. Please go ahead.

Thanks for taking my call. Just given the Abeona partnership that's been struck, just a broad question. Have you done work to assess how many, let's say, NAV Technology vectors are being used in the clinic currently by companies or organizations that aren't your partners? And if so, is the number, let's say, over 10? And then, secondly, just given AVXS-101 could be on the market in mid-2019, is there anything more you can say on sort of the ramp trajectory for the product? I know it’s in Novartis’ hands, but you have to plan ahead in terms of how you'll use your capital. So, is it kind of like a Spinraza launch or do you foresee something a little bit different?

Hey, Gbola. Thanks a lot for the questions. Of course, I think we've been at this for a while and have a lot of relationships and a lot of awareness of what's going on in the field. And I don't know that I can commit to sort of your over/under of 10, but we have certainly seen the progression and uptake of NAV Technology being significant, especially over the last four or five years, and really starting with the first time it was ever used in 2010 in that original hemophilia study for AAV8. So, our opinion is that NAV Technology has been embraced by many, both in industry as well as in sort of the community of gene therapy as essentially the primary and best-in-class. With respect to your question about Novartis ramp and sort of putative potential sales of AVXS-101, that's certainly something that we’re going to be keeping track of as the potential dates for approval get closer. But, at this point in time, obviously, we’re missing both price as well as time and other aspects that will be important to provide meaningful guidance there. And as you alluded to, that’s something that's going to start with the sponsor and the commercial entity and Novartis, and we’ll be able to derivatize from that. So, really, nothing else that we can provide on that at this point.

Great. Thought I’d push my luck. Thanks for answering.

Well played. Thanks.

Thank you. And our next question comes from the line of Ying Huang with Bank of America. Your line is open. Please go ahead.

Hi. Thanks for taking my questions. Maybe first question on the AAO data. So, can you talk about the individual patient response dispersion among the six patients? Because we have done some rough math, it seems that maybe one patient did really well and then the other two may not have gained much in terms of vision. And then, follow-up to that, is any factor you could use to predict the response for RGX-314 in wet AMD?

Hey, Ying. Thanks a lot for the questions. So, the data that was presented by Jeff at AAO, I think, established a couple of things. In addition to sustained protein expression, it established, I think, high levels of protein that we’re starting to see here are correlating to outcomes that we would expect for improvement. And so, I think if there's one major correlate that we’re looking at to answer your second question, it’s protein expression levels, I think. With respect to the comment about individual patient stratification, I think Jeff introduced some new important data at AAO on the basis of, I think, two facts. One is, I think he revisited the CRT and visual acuity outcomes. And we established in cohort three that – I think it was no patients lost vision in that cohort overall. And so, in fact, all the patients in cohort three saw an improvement in vision, so that there wasn't some stratification of one patient losing vision or being sort of outside, like you described. And the other thing is Jeff was able to drill down into the three patients that showed response at six months that required no injections over that period of time and established that as a mean in NF3 versus the NF6 in total. They had both sustained expression as well as higher levels of protein expression that were measured by the assay. So, again, what we’re seeing and what we’re feeling is that protein expression levels here are a surrogate that's important. That’s something that we've heard and it's been programmed into this design and program from the beginning. And so, we’re going to continue to track protein as an important surrogate. We’re going to look for that to correlate to the outcomes when it comes to visual acuity and retinal thickness and injection burden. But we’re very encouraged by what we’ve seen so far.

Thank you, Ken. And then, just quick one on the Batten disease. Your partner, Abeona, is also developing some therapy for infantile [ph] form of Batten. So, I assume you guys are not developing therapy for the same type of Batten disease, right?

That's right, Ying. We think there are distinguishing characteristics. As you know, kin these classes of diseases, lysosomal storage, they can break down into different forms of Batten disease. I think there are up to eight in the case of mucopolysaccharidosis disease focus. There are six types of MPS as well. And it’s not something that REGENXBIO feels like you can take on and develop expertise even though the diseases, some of them, can neighbor and be very close in their – in what they resemble clinically. It’s not something that we feel like we necessarily understand and have reach into entirely across-the-board. When we find a potential partner that does, we’re willing to sort of stratify and support. And in this case, we granted Abeona, as you alluded to, an exclusive license to AAV9, for instance, to the CLN3 form of Batten disease. Our focus is on the CLN2 form of Batten disease, one that we think is one of the more prevalent and common forms of Batten disease and one where we think we understand a lot about the disease background.

Thank you.

Thanks.

Thank you. And our next question comes from the line of Reni Benjamin with Raymond James. Your line is open. Please go ahead.

Hi, guys. Thanks for taking the questions and congratulations on all the progress. Maybe starting off with again the wet AMD program. Can you give us just some thoughts as to whether you think an expression – I guess, Cmax versus an area under the curve, which do you think might actually be important to impart a clinical benefit with these VEGF inhibitors?

Sorry, Reni. I want to make sure that I understood your question. Are you talking about VEGF inhibitors that are being marketed today? Are you talking about the approach we’re taking with RGX-314?

Yeah. So, I guess, whenever we’re looking at the data, we’re kind of comparing it with marketed VEGF inhibitors, right? And when we look at the injections, there's this huge Cmax or starting off concentration that completely deteriorates, right, over a month and then you keep getting the monthly or every two-month injections versus with RGX-314 where you have this constant expression. And I'm just curious, at least from a scientific perspective, do you need to get some sort of a bolus injection first and then have some sort of a maintenance or you think just the maintenance of a certain amount is enough to provide that clinical benefit?

Yeah, I see. No, I don't think that we have a belief. And I think there is evidence including, but not limited to, RGX-314 that sustained inhibition of VEGF, obviously, has a different pharmacological profile and is not requiring the type of Cmax exposure that you might expect from what had been derived from these sort of interval injection approaches. And I think there is – again, we’re not the only group that believes that sustained suppression of VEGF is the right pharmacological approach. There are other groups that are adopting that as well. And I think what we’re exploring and what we’re establishing pharmacologically in this first-in-human study, Phase I study with RGX-314, where we’re going next is what those levels are and how to maintain them to get the absolute best outcomes for patients with the least burden.

Got it. And then, just sticking with this for a second, can you give us any sort of color or commentary regarding antibody formations? Are you noticing an increase in antibodies? Are you currently doing any sort of steroid prophylactic or on-demand steroid injections with these patients?

So, the preclinical data around the sub-retinal approach that we use with RGX-314 borrows from, frankly, experiences in our own program as well as experiences from others in the AAV community that we’ve consulted with. And it’s also borrowed from clinical experience, including experience with a product like [indiscernible], where AAV2, in that case, is being delivered subretinally. It's not something that has been raised and adopted as a concern is sort of antibody response to capsid or antidrug antibody responses to things being expressed from subretinal delivery. Therefore, we don't even have is a criteria in our trial any exclusion criteria on the basis of neutralizing antibodies and we certainly don't do any steroid prophylaxis like you would typically only find in some of these systemic delivery-based approaches like what we’re migrating to with RGX-501. But we would never expect that as part of a profile for an ocular program. The only evidence that we have knowledge of of those types of responses exist in intravitreal delivery of AAV and that’s something that I think has been documented both preclinically and clinically.

Yeah. I was thinking that if you had intravitreal that you might also with subretinal. That’ good to know that you guys haven't had that kind of…

No, there’s a strong differentiation there.

Got it. And then, just finally, in regards to the licensing of IP, I'm kind of curious about the process here. Is this an active process where you guys go out and kind of remind others in the field of your IP or is this something a little bit more passive, in that you know people are aware of your dominant IP, you wait for them to kind of come and license from you. I'm just trying to get some sense as to how you guys manage this process? Thanks.

Yeah. I think, again, our mission and interest, Reni, is to get products to patients. And I think we’re active in that. And I think that sometimes is a function that allows us to invest in programs that we think can help patients and drive value for shareholders and it sometimes presents in a form where we seek partnership or we’re aware of activities that are going on in the research, development and clinical community that we think makes sense that for us to support. So, there is no mode of active or passive in terms of how we approach the licensing. The mode is constantly being active about making a difference using the platform to help as many patients as possible.

Terrific. Thanks for taking the question.

Thank you.

Thank you. And I'm showing no further questions at this time and I would like to turn the conference back over to Mr. Ken Mills, President and Chief Executive Officer, for any further remarks.

And I would like to make just one remark. That is, thanks, everyone, for joining us on the call. We certainly have a significant number of milestones that we’ve discussed today. And as we close out 2018, we’re looking forward to progressing the pipeline and providing you all with further updates in early 2019. So, have a great night and/or afternoon wherever you are. Thank you.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program and you may all disconnect. Everyone, have a great day.