Good morning, and welcome to Wave Life Sciences Second Quarter 2020 Conference Call. At this time, all participants are in a listen-only mode. As a reminder this call is being recorded and webcast. I will now turn the call over to Kate Rausch, Head of Investor Relations at Wave Life Sciences. Please go ahead.

Thank you, operator. Good morning, and thank you for joining us today to discuss our recent business progress and review Wave's second quarter 2020 operating results. On the call with me today are Dr. Paul Bolno, our President and CEO; Dr. Mike Panzara, our Chief Medical Officer, Head of Therapeutics Discovery and Development; David Gaiero, Interim CFO; Dr. Chandra Vargeese, Chief Technology Officer; and Dr. Ken Rhodes, SVP Therapeutics Discovery. Paul and Mike will provide opening remarks, after which Dave will discuss our second quarter financial results. This morning, we issued a news release detailing our second quarter results. Please note that, this news release is available on the Investors section of our website www.wavelifesciences.com. The slide presentation that accompanies this webcast will also be available on our website following this call. Before we begin, I would like to remind you that discussions during this conference call will include forward-looking statements. These statements are subject to a number of risks and uncertainties that could cause our actual results to differ materially from those described in these forward-looking statements. The factors that could cause actual results to differ are discussed in the press release issued today and in our SEC filings, including our Annual Report on Form 10-K for the year ended December 31, 2019 and our quarterly report on Form 10-Q for the quarter ended June 30, 2020. We undertake no obligation to update or revise any forward-looking statements for any reason. I'd now like to turn the call over to Paul Bolno, President and CEO of Wave Life Sciences. Paul?

Thanks, Kate. Good morning to everyone on the call and thank you for joining us today. I hope you and your families are staying healthy and safe during these challenging times. While we have been impacted by the global COVID-19 pandemic, we have continued to advance our clinical and preclinical neurology pipeline. Since the declaration of the pandemic in the United States back in March, we like others have been navigating a fluid and unprecedented environment and recent outbreaks around the world reminds us of the uncertainty that is likely to persist well into the second half of this year. Built from our PRISM platform, our pipeline addresses a wide range of neurology targets, and includes 11 programs that span discovery through clinical stage development. Since our last update, both our PRECISION-HD clinical trials for patients with Huntington's disease have continued, with patients advancing through the 32-milligram dose cohorts. We now expect to report data from these trials in the first quarter of 2021. We have also continued to successfully advance the work required to submit the clinical trial applications for our SNP3 program for Huntington's disease in the fourth quarter of this year. This third, allele-selective program incorporates all of our learnings from our SNP1 and 2 programs, as well as the advancements in our platform including new chemistry. Importantly, targeting SNP3 increases the number of Huntington's disease patients, who could potentially benefit from a new allele-selective HD therapeutic. In addition, we are all excited about the progress that we are making to advance our C9orf72 program for ALS and FTD. These are two devastating diseases with high unmet need and our approach has the potential to target one mutation within both diseases. Like SNP3 this program is designed with new chemistry off the platform and the variant selective…

Thanks, Paul. Today, I will begin with an update on our PRECISION-HD1 and PRECISION-HD2 clinical trials for the treatment of Huntington's disease. During the COVID-19 pandemic, we have remained keenly focused on ensuring the safety of our study teams, patients and investigators. While both clinical trials have continued to advance, clinical trial-type patients and investigators are facing new or continued restrictions. Progress has continued and we have been successful at identifying the patients needed to complete the 32-milligram cohorts for both studies. While we are working to enroll these patients as safely and efficiently as possible, we now anticipate being able to share data from all treatment cohorts for both SNP1 and SNP2 studies, as well as data from our open-label extension trials in the first quarter of 2021. At the beginning of the pandemic and the time of our last update, we were hopeful that we could keep our studies on track because of the prioritization; disease-modifying studies by health authorities, the infrequent dosing regimen of the PRECISION-HD trials and based on the locations of our clinical trial sites. While this has certainly been helpful the ongoing impact of the coronavirus has been unavoidable. We believe that selectively lowering of mutant huntingtin will be critical to achieving a long-term clinical benefit with any therapeutic in HD, which is why we are expanding our commitment to HD patients with the development of our third allele-selective program SNP3. Preparations continue towards beginning clinical development, with the submission of a clinical trial application, or CTA, for SNP 3, which is expected to occur in the fourth quarter of 2020. We have leveraged the learnings from both our first HD clinical programs in terms of candidate screening, identification and in vivo target validation, as well as advancements in our platform when designing our…

Thanks, Mike. For the second quarter of 2020, Wave reported a net loss of $40.5 million compared to $41.9 million for the same period in 2019. Research and development expenses were $31.5 million in the second quarter of 2020 compared to $41.6 million for the same period in the prior year. The decrease in research and development expenses in the second quarter was primarily due to decreased external expenses related to suvodirsen, due to our December 2019 decision to discontinue the program, partially offset by increased external expenses related to our clinical and preclinical activities including our HD programs and our C9orf72 program for ALS and FTD. General and administrative expenses were $10.2 million for the second quarter of 2020 compared to $11.6 million for the same period in the prior year. The decrease in general and administrative expenses in the second quarter of 2020 was mainly driven by decreased headcount resulting from the workforce reduction implemented in February 2020. Wave ended the second quarter of 2020 with approximately $94 million in cash and cash equivalents. We expect that our existing cash and cash equivalents together with expected and committed cash from our existing collaboration will enable us to fund our operating and capital expenditure requirements into the fourth quarter of 2021. As a reminder, we do not include potential milestone payments and other uncommitted payments related to our Takeda collaboration in our cash runway. I will now turn the call back over to Paul for closing remarks. Paul?

Thanks, Dave. We have made significant progress this year despite challenges posed by the global pandemic. We continue to advance our neurology pipeline with two CTA submissions expected in the fourth quarter and data readouts from our PRECISION-HD trials expected in the first quarter next year. In the near term, we have several updates planned to be included in our upcoming research webcast presentation, including C9orf72 preclinical data, in vivo data on our ADAR editing modality and data highlighting our new chemistry enhancements from our platform. The research webcast will be held August 25 and we hope you can tune in. With that we'll open up the call for questions. Operator?

[Operator Instructions] Our first question comes from the line of Eun Yang from Jefferies. Your line is open. Please go ahead.

This is Suji dialing for Eun. Thanks for taking the question. So I have a question about this SNP phasing that Paul mentioned. You mentioned that SNP phasing was burdensome earlier. Does it mean that the SNP3 clinical trial we use different protocols for SNP3 compared to the earlier HD1 HD2 program? And then could you please give a quick enrollment for the PRECISION-HD1 program please? Thank you.

I'll pass the call to Mike, but just to begin, I think it was clear what Mike was saying was that it was presented to us is this would be a challenge. We have been able to do that from the beginning and have continued to provide enhancements to that. I'll let Mike continue to comment on the SNP phasing aspect. Mike?

Yeah, hi. That -- it's exactly what Paul said basically. What I had said is that, we were always told when we started this process of identifying patients to have this allele-specific approach that there would be a lot of burden and it wasn't really feasible to do in a practical way to do clinical trial, but from the beginning we've managed to do that. We've managed to do the study that I mentioned we published. We managed to do it in the trials. And the new approach will be working with our partner Asuragen to develop the next-generation phasing approach that allows it more amenable to a companion diagnostic. So we've moved it along. We've managed to use it efficiently and we're looking forward just continuing to do that. And I think the second part of your question was about enrollment. We don't give specifics about enrollment. But what I can say is luckily we've been able to identify patients for the filling of the cohorts including their SNP phasing and we're just working to get them into the studies.

Okay, great. Thank you.

We have our next question comes from the line of Mani Foroohar from SVB Leerink. Your line is open. Please go ahead.

Hey, guys, thanks for taking the question. A couple of quick ones. We'll start with the boring finance question. I'm looking at how you guys have fairly rapidly reduced your cash burn in the follow-on to the suvodirsen data. Can you give us a sense of how much of your spend this quarter to last quarter was separation costs regarding that? And how much incremental cost there is to come out? It's proving a little bit challenging to get to your 4Q 2021 -- to your 4Q 2021 cash runway guidance for us, and I think we aren't going to be overmodeling it. Moving to clinical trial operations, you guys have seen a series of delays in your Huntington's enrollments. And taking your own published data versus what we know about the epidemiology of Huntington's you should have been able to enroll assuming you are all somewhere near the speeds that Roche and Ionis is essentially the entire study from one or two large sites given the epidemiological data you've given us regarding the prevalence of SNPs, so what do you think the reasons are that patients are avoiding your study? Are there changes you can make to your -- to either your R&D leadership or to your R&D strategy and execution to avoid future underperformance in enrollment speed and clinical development? Thanks.

Thank you. So we’ll take the first question first in that and I will let Dave follow-up with some of the financial guidance. But yes as you pointed out there was the substantial reduction related to FTD costs as well as operating costs related to suvodirsen. Dave do you want to speak to the finances?

Sure Paul. So as you saw we did have reduced cash from Q1 to Q2. In addition as we reported in our 10-Q this morning we've also earned approximately $20 million on our ATM since March of this year and so that's also adding to our extended cash runway.

And the second part of the question, Mike, do you want to talk about the speed of enrollment?

Yeah. I mean, I think that there are patients out there. We've managed to identify them. We've actually started to be able to work with the sites to get through this pandemic but let's just remember we have this pandemic going on. And just give me -- I'll give you a concrete example -- I mean, we have -- you are right. We have -- half of our sites are out there in Australia just to give you an example half -- many of our sites are in Australia. And we had a whole group of patients scheduled to come into the study beginning last Wednesday. And then Monday, Melbourne announced a sudden lockdown that just essentially wiped out a whole group of patients that could have gone into the study at that point because of the lockdown in Melbourne and so we had to redirect efforts then to other places. So I mean this is a very complex and fluid environment. I'd say the issues of this year are certainly very different than the issues of last year. And I think that we have adapted -- we made changes last year to improve upon our recruitment this year but it's not a patient interest issue. It's not a patient interest issue at all. We actually have -- there's a lot of interest in the community and I think that we are in a -- we are just right now trying to navigate a very complex situation.

That makes a lot of sense to me. But given the severity and the relentless decline associated with Huntingon's unsurprisingly there is a lot of patient interest in any potential therapy. I get that. But again what are the structural changes, Paul that you are thinking of making in your research leadership headcount, et cetera to avoid delays like this. For example, one could have chosen for one APAC enrollment site; one could have chosen for example say like, New Zealand, which has much less of a COVID impact or other places where you would have exposed yourself to less of this risk. Given the study has been going on for a couple of years, I would have thought you would have considered that.

Yes.

Also, again, how are you in changing research leadership strategy and headcount is now necessary?

Yes. So, I think the key is prior to this to your point on New Zealand, we only knew about that New Zealand was less impacted more recently. So, getting sites up and running during a pandemic and shifting that wasn't there. I mean, I think we had the diversity of clinical trial sites that earlier this year had things on a positive trajectory. I think to Mike's point, we did make changes both in our operating relationship internally with our global CRO network, we enhanced our clinical development team adding additional physicians more recently to again continue to focus on delivering and executing on the study. As Mike said, the patients are identified so this is an identification issue, it's now just closing it out and hence that shift.

Okay. Thanks for taking the question guys.

What's that?

I said, thanks for taking my questions.

Oh, thank you, Mani.

We have our next question comes from the line of Salim Syed from Mizuho. Your line is open. Please go ahead.

Hey, Paul. Hey, Mike, Hey, Dave. Thanks for all the color guys. Just a few from me if that's okay all in the Huntington's program. So Paul or Mike, could you maybe just give us some color how you guys are thinking about the bogey here? Given Roche and Ionis is 60% knockdown on both the mutant and the wild type, what do you think you need to have? And if you are just knocking down the mutant in order to be clinically successful here in the upcoming dataset. Number two is, when we looked at the pooled -- the data from the -- that you disclosed in December, which included the 16-milligram -- on the 95% confidence interval, you went up as high as 25% knockdown on the mutant huntingtin? And I'm just wondering here if there's anything to suggest that the 16-milligram is actually hitting closer to the 25% than something lower than that whether it was the 12% or closer to the 0% on the lower end of the confidence interval? And then lastly, if you could just give us some color on any data that you may be getting in the blinded aggregated setting if you have access to NFL data perhaps or if there's anything you are looking at there in the blinded aggregated data? Thank you.

Yes, I'll pass the call on to Mike to answer the question specifically, but it's an interesting transition over, because I think we are excited to have continued OLE data in that first quarter as well to review at the time we have the 32-milligram data. So, in aggregate a lot of data to evaluate. Mike, do you want to speak to the numbers?

Well, yes. So, I mean, I think that in terms of -- I mean, as you all know, I think that what is a meaningful reduction in mutant huntingtin is really not firmly been established. I mean, if you think about what -- you mentioned the 40% to 60% knockdown that's often quoted the actual study that's being conducted is essentially if you are at HD meetings, the last HD meeting really where anybody could attend was the CHDI meeting at Palm Springs, the target of 20%, 25% was being spoken about essentially by Roche in terms of what they felt was the minimum meaningful when you are considering a knockdown that includes both mutant and huntingtin. So that's the number that's actually been out there, but you hear people talking about as meaningful. So we would think that if it's meaningful in the setting of non-specific knockdown, certainly, that's going to be meaningful in the setting of selective knockdown. So -- but I think true answer to that until you have clinical effect and see how that all translates, it's really not clear. So we are – obviously, we said many times that we were dissatisfied with the interim analysis that we saw. We wanted to go higher. We have gone higher. And now that's -- we are looking forward to seeing that data. In terms of ongoing assessments of biomarkers and those types of things, we are -- the assay -- that type of stuff is very tightly held and restricted and we share safety data with our safety monitoring committee that is unblended, where they go and they -- after each cohort as we've talked about talk about dose escalation. We review blinded information, but we do not review blinded biomarker information. That is not a standard review process at Wave.

Got it. Thanks, Mike. Mike I don't know if -- maybe I missed it, on the 16-mg, can you maybe opine on that a little bit?

I mean, again, we've been clear that we've shared that interim analysis, which was pool data the pooled active cohorts versus the pooled placebo cohorts. We've never really gotten into the individual knockdown of each cohort separately. That's all going to be part of the data readout in the first quarter.

Okay. Thanks very much guys.

And with the interim data early the single data as well as the OLE data too. So we will have more opportunities for continued dosing. So more to come.

Thanks, Paul.

We have our next question comes from the line of Paul Matteis from Stifel. Your line is open. Please go ahead.

Hey. Thanks for taking the question. This is Alex on for Paul. Just a couple from us. I guess I'm curious for your next clinical program SNP3 and the C9orf72 programs. You mentioned the CTA filing in 4Q. Just wondering, if you could give us an idea of when you think you could start dosing, if that's all going to be ex-U.S. or if you are thinking about filing an IND sometime soon as well? And then, on your AD and PD programs, curious if you could give us any more color on the source of targets that you are looking at? Thanks.

That's great. As it relates to C9orf72 and SNP3 updates regarding the CTA, Mike do you want to comment on?

Sure. Sure. I mean typically, once you give you the CTA in, obviously, it depends upon when you get your sites up and everything. But generally, we like to think about a quarter after your CTA then you begin to be able to dose. So that's about what we've been finding of course, that was certainly -- and that's typically when there's no COVID going on. So we will have to see how that goes. But, we are going to be targeting countries where we can do it, despite COVID. And so which – again, we are going to take this globally and our intention to get this off the ground inside and outside of the U.S.

As it relates to the AD, PD and other targets from Takeda, unfortunately, we are not at liberty to disclose the confidential targets as part of the collaboration, but as they make progress, we are working with them to be able to share more around those programs, but the team continues to push forward. And as we've said, we've been able to implement using our new chemistry similar to those that we are using for SNP3 and C9 and those programs as well, and we are excited to provide that update on what's happening on the research side of Wave during our upcoming research day.

Thanks. And I guess one quick follow-up there. Could you give us a quick update on the ophthalmology program? I don't know if I saw that in the press release, just curious where that stands. Thanks.

Yeah. So as it relates to the ophthalmology, we had done a lot of work looking at target engagement, both in the back of the eye and the retina around USH2A and RhoP23H. We haven't provided additional updates related to those programs as we look at the collaborative path forward to advance those programs.

Great, thank you.

We have our next question comes from the line of Yaron Werber from Cowen. Your line is open. Please go ahead. Once again, Yaron Werber, your line is open. Please go ahead.

Hi, guys. This is Brendan on for Yaron. Thanks for taking the question. Just a couple of quick ones from us, mostly on HD and kind of different dosing cohorts here. So, you mentioned that the Q1 readout will include data through the 32-mg, have you be considering maybe higher additional doses? So I guess, first, I was hoping to see -- like what can we expect from the readout in Q1 in terms of time after treatment? I guess namely how far out after the treatment will the readout include at that point? And then, also how do you think we should think about the time line for these programs? Would you potentially wait to proceed to pivotal until additional hyperdose cohorts are fully enrolled in readout? And then I have one follow-up, if that's all right.

Mike, would you like to take the HD question?

Yeah. So again, you would expect at the time of the readout in the first quarter, you are going to get the -- as you remember, the design the whole full four doses of the 32-milligram dose level plus basically all the lower dose cohorts. So, that will all be part of that. It will include the key biomarkers, we have talked about mutant. It will include -- we are work striving to get our assessment of wild-type done by then and actually you will have clinical and safety in those types of things. At that point, after we are done with our -- after we are done with the 32-milligram, we are also going to understand at that point -- you will understand whether we are going to a higher dose, and we will have all of that able to discuss that with you. In addition, you will have the open-label extension study data SNP1 and SNP2, whatever we have after a certain number of doses similar to what we are dosing in the PRECISION-HD. So you will have longer-term dosing than you will have with PRECISION and some patients with similar dosing. So it's a fairly large dataset that we will be sharing in that first quarter and with the hope of again sharing with all of you, our thinking about what the next steps would be. In terms of the steps towards a pivotal, that will be driven by the degree of knockdown that we see across all the full cohorts. Remember, the interim was only a partial cohort in that and not everybody had gotten out the day 140. So we will -- once we look at all of that, once we look at the OLE, once we look at the 32-milligram knockdown that will put us in a better position to determine the next steps towards our pivotal study which we would anticipate given where we are that we should be able to begin those steps once we see that 32-milligram knockdown. if that level is at a level that we feel is meaningful. So we're already beginning the thinking on how we do that.

Okay. Great. Thanks so much. And just really quickly, I was also hoping as you kind of mentioned you guys are working to optimize the wild-type detection assay. I was hoping that we can maybe get a little bit more color on kind of where that stands and maybe what's just left to optimize? And how you might be and if you are looking to implement it differently than you have previously or kind of -- just where that is at this point? Thanks.

No, I definitely hand this to Mike. It's an exciting amount of work on the research side to answer a really important question for the field. Mike, would you like to add?

Yes. Thanks for that. So as we discussed at the interim analysis the mutant assay is an assay that is similar to what others are using to measure mutant and at that time we also discussed how we looked at the total huntingtin in CSF samples. But we also said at the time that there were pretty significant limitations to that in terms of how you look at the mutant versus the total and the difficulties measuring the wild-type because it's an indirect measurement. What we are talking about now is wanting to specifically focus on measuring the wild-type portion of that total pool. This is something that we have been spending a lot of time thinking about. We actually are looking on implementation of that. And we are striving that when we reveal the data in the first quarter we will have an assessment using a new approach that will allow people to understand whether what is being measured in that total assay what piece of that is wild type, what piece of that is mutant. And then make that -- our intention is to sort of work with the community to make that a little bit more widely available should we be successful because we think this is an important thing that needs to be looked at and we don't think this is something that we alone should be using. We think this is something that's important and the community that the partners we are working with are quite excited about the approach.

Yes. It's great. I mean moving away from this kind of dynamic range and ratio to kind of more concrete numbers is obviously the direction that we said at the beginning, we would move to and the team has been working extraordinarily hard to advance it. So we are excited to keep pushing that forward.

Okay. Great. Thanks guys.

Thank you.

We have your last question. It comes from the line of Eun Yang from Jefferies. Your line is open. Please go ahead.

Hi. This is Suji again. I have a quick question on the OLE data that's expected in the first quarter of next year. Are the patients in the OLE currently receiving those drugs right now? And then what do you expect to show? And then the second question I had was for the SNP3 Phase 1 trial that you are going to start, is that design going to be similar to the SNP1 and SNP2 program, or do you expect to start that study in healthy volunteers first? Thank you.

Yes. So I'll pass the question to Mike, but the Phase 1/2 study in SNP3 will be in patients. But I'll let Mike continue to answer questions around the OLE and the SNP3. Mike?

Yes. So the OLE, the way the doses are -- so everybody in the open-label extension study is getting active drug and the way the study is designed is that once a cohort is shown to be safe in the PRECISION-HD study, patients are migrated up to whatever the highest dose. The highest safe dose has been in the PRECISION-HD study. So patients are migrating after the highest dose is tested in that study. And what we will see in the first quarter are the -- basically the safety and the biomarker results of those patients over the duration that they have been exposed. The other -- in terms of the SNP3 trial versus similarities to SP1 and SP2 certainly there will be a lot of similarities, but they have also had a lot of learnings from the PRECISION-HD1 and HD2 studies that will be incorporated into the PRECISION-HD what would likely be the PRECISION-HD3 study. And this study in terms of phasing as I mentioned earlier, we will be using the new technology for SNP phasing through our partnership with Asuragen.

Thank you.

We have another question from the line of Debjit Chattopadhyay from H.C. Wainwright. Please go ahead.

Hi, guys. Good morning. Thanks for the data updates and then sorry for that delay. So I wanted to ask -- oh and by the way this is Aaron on for Debjit. And I wanted to ask are the newly identified patients for the PRECISION studies all at the same site or are they geographically diverse? And do you have more patients identified that are needed to fill out the cohort or is it exactly the number of patients that are required? And then finally, if your patient misses an injection or a follow-up are they totally excluded or is there a new patient is needed or is there -- how much flexibility is there?

Mike would you like to take those please?

Yes. I mean all I will say is that we have multiple sites with patients in multiple backups. So there's no exact here because we are starting to think about additional cohorts and additional patients. So yes, we have more patients that have been phased that we need and then more on sites than we need to do it.

Okay. Great. Thank you. And then a quick follow-up. So would dose escalation beyond 32 milligrams be dependent on -- how full of a dataset you need to justify escalation beyond 32 milligrams? Do you need the full patient dataset at 32-milligram out to 192 days or is there some sort of partial?

No we've never waited for the full 196 days. It is actually to be able to make that decision. As you recall going from 8 to 16 and 16 to 32 was made before we had any biomarker data or had complete safety data. It was based upon the safety of the single-dose cohort and the review of an independent safety committee. So we haven't waited to completion before making those decisions.

Okay, great. Thanks guys.

Thank you.

There are no questions at this time. I'll now turn the call back over to Dr. Paul Bolno.

Thanks everyone for joining the call this morning to review our second quarter update and thanks to our employees for their hard work and commitment to patients. We look forward to speaking to you again soon in our upcoming research webcast. Have a nice day. Thank you.

Ladies and gentlemen that does conclude our conference for today. Thank you all for participating and you may now disconnect. Have a great day.