Good morning, and welcome to Wave Life Sciences Fourth Quarter and Full Year 2023 Financial Results Conference Call. At this time, all participants are in a listen-only mode. As a reminder, this call is being recorded and webcast. I'll now turn the call over to Kate Rausch, Vice President, Investor Relations and Corporate Affairs. 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 fourth quarter and full year 2023 financial results. Joining me today with prepared remarks are Dr. Paul Bolno, President and Chief Executive Officer, Kyle Moran, Chief Financial Officer and Anne-Marie Li-Kwai-Cheung, Chief Development Officer. The press release issued this morning is available on the Investors section of our website, www.wavelifesciences.com. 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 several 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. We undertake no obligation to update or revise any forward-looking statement for any reason. I'd now like to turn the call over to Paul.

Thanks, Kate. Good morning, and thank you all for joining us on today's call. I will open with comments on our recent progress and continued execution on our strategy. Next Anne-Marie will provide an update on our three ongoing clinical trials. Before opening up the call for questions, Kyle will review our financials. Chandra and Ginnie will also be available for questions. 2023 was a year of execution and tremendous progress for Wave. Our achievements demonstrate the far-reaching potential of our multimodal platform to reimagine what's possible for human health and pioneer medicines that truly change people's lives. We are leading the field in multiple areas. We are innovating in obesity with our INHBE program and today are announcing that we've accelerated development to initiate our INHBE clinical trial in the first quarter of 2025. We are also leading the field in RNA editing having brought the first ever RNA editing candidate into human trials last year. In DMD, our novel chemistries have dramatically improved pharmacology of exon skipping oligonucleotides, translating to best in class muscle distribution and skipping with WVE-N531. In HD, we've pioneered allele selective silencing, another first for the field and an approach that has the potential to overcome issues experienced by pen silencing approaches. We expect meaningful catalysts throughout this year for all of these programs, setting 2024 up to be a significant year for Wave. I'll start with our ongoing clinical program of WVE-006 for Alpha-1 antitrypsin deficiency or AATD. Our RestorAATion clinical program for WVE-006 is well underway and we have a pipeline of RNA editing program being advanced behind it. We are pioneering these first in class medicines across protein RestorAATion targets such as AATD as well as mRNA upregulation targets, which I'll discuss further in a moment. WVE-006 is the industry's first…

Thank you, Paul. 2024 should certainly be an exciting year for Wave and I look forward to the many milestones we have on the horizon. I'll start with WAVE-006, our GalNAc conjugated AMR or RNA oligonucleotide for AATD. We're advancing WAVE-006 in our ongoing RestorAATion clinical program. The program is comprised of two interconnected portions, RestorAATion-1 for healthy volunteers and RestorAATion-2 in AATD for patients who have the homozygous PiZZ mutation. In addition to generating key safety and PK data, RestorAATion-1 is designed to rapidly establish a dose level and regimen that's expected to engage target. In the RestorAATion-2, we will be taking multiple assessments of serum M-AAT through the low, medium, and high dose cohorts, which will enable us to quickly detect the potential presence of wild-type healthy M-AAT protein in serum, representing achievement of proof of mechanism. Remember, these easy patients have never made M-AAT protein. So, the presence of any M-AAT would demonstrate that WAVE-006 is successfully editing RNA. We are progressing well in RestorAATion-1. Dose escalation is ongoing. Pharmacokinetic data is as expected, and blinded safety data has been encouraging. We're on track to initiate the RestorAATion-2 study and deliver proof of mechanism data from RestorAATion-2 in patients with AATD this year. Turning to DMD. This week, our team attended the 2024 MDA Clinical and Scientific Conference, where we showed posters on our clinical data from Part A, including the first evidence of myogenic stem cell or satellite cell uptake. Myogenic stem cells are the progenitor cells for new myoblast, and we're not aware of any other clinical data for exon skippers or gene therapies that have been able to demonstrate myogenic stem cell uptake. The DMD community is excited about these data and what they may mean for their boys. Our post has also highlighted…

Thanks, Anne-Marie. Our net loss was $16.3 million and $57.5 million for the fourth quarter and full year 2023 period respectively. Our net loss significantly improved over the prior year periods primarily due to the substantial revenue earned from our collaboration partners. During the fourth quarter, we recognized revenue of $18.9 million under our collaboration with GSK, which came effective in January 2023. We also recognized revenue of $10.1 million in the fourth quarter of 2023 under our collaboration with Takeda as compared to $1.2 million in the prior year quarter. Research and development expenses were $34.1 million in the fourth quarter of 2023 as compared to $31.1 million for the prior year quarter. This increase was primarily driven by increased external expenses related to our DMD and AATD programs as well as increases in compensation-related costs. These increases were partially offset by the decreased spend on our discontinued C9 program. Our G&A expenses were $13.7 million essentially flat compared to the prior year quarter. We ended the fourth quarter with $200.4 million in cash and cash equivalents. Subsequent to year-end, we also received $20 million in a milestone payment for GSK and $14 million in net proceeds from the full exercise of the greenshoe option for our December 2023 financing. We expect that our current cash and cash equivalents will be sufficient to fund operations into the Q4 of 2025. As a reminder, we do not include any future milestones or opt in payments under our GSK or Takeda collaboration in our cash runway, but we do have the potential to receive meaningful near-term milestone payments in this year and beyond. I'll now turn the call back over to Paul for closing remarks.

Thank you, Kyle. As we look to the remainder of 2024, we are at a truly exciting inflection point with the opportunity to further validate our best-in-class platform in the clinic and unlock the broad potential of our pipeline. This year, we're on track to deliver three important clinical data readouts as well as advance our INHBE program towards the clinic. And in summary, we plan to deliver the first ever clinical proof of mechanism data for RNA editing with WAVE-006 this year and share new preclinical data on our advancing RNA editing programs. Submit a CTA for our INHBE siRNA obesity program as early as the fourth quarter and initiate a clinical trial in the first quarter of 2025 deliver data including dystrophin protein from our potentially registrational FORWARD-53 clinical trial in the third quarter and deliver HD data from the multi dose select HD trial with extended follow-up along with all single dose data in the second quarter. We look forward to sharing our progress with you along the way as we reimagine what's possible for patients and continue on our journey to building a leading RNA medicines company. And with that, I'll turn the call over to the operator for Q&A. Operator?

[Operator Instructions]. Our first question comes from Steve Seedhouse with Raymond James. Your line is now open.

This is Timur Ivannikov on for Steve. So, we have a couple of questions for your AATD RNA editing. I think you mentioned you will be disclosing serum M-AAT. So what level of M-AAT are you targeting eventually, since one of your competitors expects to target to achieve eventually healthy levels? Is that something you're looking at right now? Or what is your expectation for the M-AAT level? Thank you.

Anne-Marie, would you like to start? And then I'll.

So, I think the important point to recognize is that we're not delivering exogenous AAT replacement therapy. We're restoring wild-type healthy M-AAT through RNA editing, and demonstration that M-AAT is functional is really the key. We're already in the ballpark of 11. We know that MZ patients have a lower normal limit of 11 with very low risk of clinical outcomes. And with the editing and restoring of the M-AAT, we believe that patients will be able to respond in like healthy patients.

I think just kind of stepping back as well and as Anne-Marie said, the threshold that came out of 11-micromolar because that was the lower limit of the heterozygous patient, obviously, the target of where you can get with correction. I think if we think about the range that we've already seen in preclinical studies, as we said earlier on the call, we're already achieving ranges that are both not only within heterozygous, but also the healthy. And so, I think we need to reframe how the RNA editing and we should say the editing field thinks about protein levels versus, let's say, exogenous protein. So, if you imagine exogenous protein, the concept of more and more was really born from that because you're putting an exogenous protein in, it's being depleted and you're trying to stay at a threshold level protection. If we're doing editing and already achieving the correction of transcript at levels that would be equivalent to heterozygous patients or potentially healthy patients. Then you've established a threshold for so 11 micromolar would establish at a lower limit, would establish a threshold of protection that's equivalent to these heterozygous patients with the knowledge that you've corrected the underlying genetics or you've corrected the transcript, so that when these patients do need more protein, they're able to produce more wild type protein. And so, there's a different dynamic at play in editing correction than when one thinks about protein replacement. So, I think there is still a lower limit of 11 micromolar. Our preclinical data has well surpassed that. As I said, it got to threshold level of even healthy patients. But I think we need to shift from a more as more concept within editing once you've achieved those threshold levels. And then really it is about, how to keep patients and save patients on these therapies. But we will be measuring both total AAT protein and as Anne-Marie said on the call being able to look at M-AAT to look at that percentage of edited protein.

Okay. Thank you, very much for that. And we also have a question about the progress of the clinical study itself. Just in terms of what dose levels have you completed in the healthy volunteers and what dose do you actually need to complete before you can start dosing patients? And have you started screening AATD patients already?

So, as you know, the RestorAATion-1 and RestorAATion-2 studies are interconnected. And in RestorAATion-1, in the healthy volunteers, we're progressing through the dosing as expected with the aim of starting RestorAATion-2 at a therapeutic relevant level, and we're on track to do that. With data from RestorAATion-2 for proof of mechanism expected this year.

I think what's important and to add to that, as Anne-Marie said on the call earlier, I mean, it's important when you bring in new modality into the clinic how is PK translating. And I think as we said on prior calls and discussions that a key driver on that dose selection is going to be based on modeling. And I think what's encouraging is that modeling is sustaining in that healthy volunteer setting. So, I think we're on track to deliver that.

Okay. Great. Thank you, very much.

Our next question comes from Salim Syed with Mizuho. Your line is open.

Congrats on the progress and enjoy the new website, Paul. I guess on INHBE, Paul, I know you can't you're not going to give us the full clinical trial design, but perhaps can you just guide us how you're sort of thinking about the initial trial design size? Would you be willing to use an active comparator just given how quickly the space is moving? And just sort of where your intentions are in terms of treatment, in the treatment landscape, where do you really see this INHBE product getting slotted? Thank you.

Thank you and thanks for noticing the updated web design. Hopefully, it makes it easier to access information for all our constituents. As it relates to the and I'm glad we're talking about clinical trial designs for INHBE and there will be a lot more to come on that as we move throughout this year. I think the other update to your point on the evolving landscape and how do INHBE silencers relate to other therapeutics. I think we've got a lot of opportunities throughout 2024 to continue to provide updates on thinking about these synergies. As it relates to the initial trial design, I think this is one of the advantages we have with a very potent and durable program. As we're saying, we think we're beyond potential twice a year dosing into thinking about annual. Let's just think creatively about designing healthy volunteer studies because we do have biomarkers, not just biomarkers of target engagement, but because of INHBE in some of the genetic studies have shown that actually these patients have lower levels of triglycerides and LDL, they have higher HDL, there are a whole bunch of other biomarkers we wish to study. So, I think as we think about running an overweight healthy volunteer study, it provides ample opportunity for us to build a profile, not just to establish dose and safety, but also to look at pharmacodynamic effects across these biomarkers and then think about that to your point on how do we want to sequence that in on the treated population. So, I think the initial study, we don't have to think about is this a run-in on whether it's GLPs or other therapies. I think the advantage we have in the healthy overweight volunteer study would be a clean population with which to exhibit the effects. That then would set us up to the ability to think about how we use this either in combination or sequence as patients could transition off of GLP-1 as we think about subsequent clinical studies. But I think first and foremost, we're just very excited to see the speed with which we can translate our RNA platform from a target that we introduced last year into the clinic. And I think it just speaks not only to the discovery capability we have in RNAi, but also to the synergy we have with having our own internal manufacturing capability where when we see an important high impact program, we could rapidly translate that into the clinic. And so, I think more to come on that over the course of the year.

Great. Thanks, Paul.

Our next question comes from Joon Lee with Truist. Your line is open.

On the INHBE program in obesity, can you elaborate a bit on the nature of the INHBE mutation in the general population that confer protection against obesity? I understand that, they are heterozygous, but how penetrate are the heterozygous phenotypes? And what are some potential genetic modifiers in the phenotype that could complicate your clinical assessments? And I have a quick follow-up.

I mean, I think as we look at lots of function, protective lots of function variance, I think it's always, they're few and far between defined and when you find them, you learn a lot of interesting things on the other side of it. So, I think the notion of up being able to find what happen in patients who are heterozygous. So, I think your question is rather than looking at it as like let's say a toxic gain of functions that we need to knock down and correct, the opportunity here to see what is it about this population that is protective. So, I think the penetrate is probably like less than 0.1%. And this is because we probably as a species evolved actually for fat storage in another direction. When we go back to clinical genetics and see that actually this loss of function confers reduction of abdominal obesity, reduction in key measurements of bad cholesterol, so triglycerides, LDL, improvements in good cholesterol, HDL. And then importantly, as we think about kind of the byproducts of both of those, and I think that's what's unique about the human clinical genetic experience from UK Biobank is you follow these patients out, is you see this reduced odds rate of cardiovascular disease and Type 2 diabetes. So, it's really a protective loss of function. The question in all of these always comes down in our minds to your point of what happens if you were to induce that into something you need from birth is, is this a correlative mutation, which case you just happen to see it? Or do you need it from birth? Or is it inducible? And so, when we really thought back and this is why the data last year was so important to have…

That’s very helpful, Paul. Thank you. With regards to the assessment, would it be as simple as weighing them? Or is it more complicated given the beneficial impact potentially on muscle mass? Just curious your thoughts on how you're going to capture the overall clinical benefit?

So, I think the opportunity and just to make sure I'm getting frustrated, how do we see the benefit of fat loss in the clinic as opposed to corresponding with weight loss? Just want to make sure I get.

I mean, GLP-1 is pretty straightforward. You just weigh them and then weight loss is a endpoint. In your in your drug, you lose weight from the fat. At the same time, you don't lose muscle mass. So, how do you capture that benefit? Would you like to do a functional test? Or is it just weighing them?

No. I mean, in reality, I mean, the beauty of the preclinical models is we have dissected that out, right? We can see reduction in weight and we can measure fat and that was the key in moving this program forward. So, we're seeing weight loss coming at fat loss. And we measure muscle lean muscle mass. And that's why we showed actually as we reflect there can no lean loss of lean muscle mass, which I think is an important determinant. As we think about going into the clinic, you're right, we're also going to measure weight, because that is an important feature. But we can do hip to weight ratio. If we think about the phenotype of loss of protective, loss of function, those humans, I don't recall them patients, those humans in the population that have this loss of function have low hip to weight ratio and BMI. So, we can take measurements that correlate with that reduction of abdominal fat and reduction in weight and demonstrate that. There's also opportunities as well in the clinic for imaging to be able to specifically look at abdominal and visceral fat. So, there are measurable biomarkers to really distinguish this program from other classes of obesity products that really speak to on-target mechanisms.

Our next question comes from Joseph Schwartz with Leerink Partners. Your line is open.

Thanks very much. I was wondering a couple of things on INHBE. Can you first talk about the key characteristics which you were able to achieve that encouraged you to elect your INHBE lead clinical candidate ahead of expectations? What were you aiming for? How did it come together quicker than you planned? And what work remains to be done before you can move into humans?

Yes. No. Thanks for the question, Jos. So, I mean, the key characteristics were obviously started with the program last year, which we had already established, which is weight loss similar to other obesity products in the class. And importantly, and to Joone's last question, demonstration of differentiation to that on target, meaning this mechanism of loss of function wasn't just weight loss at the expense of muscle. So, it wasn't induced anorexia. It was actually targeted loss of fat. And so, we were able to demonstrate that consistently as part of the biology of the program. I think the driver as we thought about selecting the candidate was really driven around dose and dose frequency. So, recognizing that this is a large indication, those two things as we've learned from other products like inclisiran are important to be seeing, as we said, low-single-digit dose, so very being able to use a low amount of drug, we said, GalNAc conjugated siRNA helps with that. And importantly, two, durability. We wanted a product that had a profile of at the most twice a year dosing and potentially less frequent picking annually. Those achievements were what helped us identify and knock in on our candidate. What's still to be done is the IND enabling studies. Those are underway. In terms of what enabled us to accelerate this, I think there are really two fundamental parameters. One is with the resources as we said last year and the finance it was really about accelerating the time to candidate here, we could run experiments in parallel to make sure that they were moving forward. Couple that with I think which is really nice is the translation of the siRNA template. So, with siRNA we're able to move that template rapidly and to see that benefit. The second feature, which enabled us to truly accelerate it was having in house manufacturing, meaning we didn't have to go out to a CDMO to start trying to find a slot to make material, not just for our preclinical studies and toxicology studies, but getting ready for the clinic. So, by having in-house manufacturing, we could deliver the data pre-clinically IND enabling study material and importantly make our clinical trial material so that we could be best positioned to rapidly move to clinic. So, I think the convergence of all of the things that we have been working on at Wave over the last decade we're really able to allow us to rapidly translate the insights from last year on the INHBE target into a potential medicine that we'll bring into the clinic in early 2025.

That’s helpful. Thank you, Paul. And then given there are so many different animal models for obesity, I was wondering which one or one should we focus on that best demonstrate the potential for a differentiated clinical profile of WAVE-006 relative to the wide array of incretins in development and which ones tend to translate the best both for weight loss effects as well as the potential metabolic benefits?

Yes. I think we have chosen to focus on the diet induced obesity mouse model in that, there's other models of being overweight that require how you're fed and making sure that you can best possible recapitulate what's seen in humans. I think these models as we've seen and we've shared data before are highly correlative. We can benchmark that against existing GLP-1s and the performance of those in weight loss. But I think what's also important in these models is it does allow us to do what we've done, which is discern fat loss from weight loss, being able to do lean muscle mass measurements to show that you don't lose muscle mass at the expense of weight loss. So really fat loss is as a concept of what healthy weight loss is. And so, the models have let us do a lot in terms of measuring the biomarker, et cetera, just to be able to best plan for dose, dose frequency and moving to the clinic.

Thank you.

Our next question comes from Luca Issi with RBC Capital. Your line is open.

Thanks so much for taking my question. Congrats on progress. Maybe two quick ones here. Maybe on Huntington, can you just remind us the mechanics of the Takeda opt in right here and what would you think they need to see in Q2 in order to exercise that option? Again, any color there much appreciated. And then maybe on GLP-1, if I capture it correctly you mentioned on this continuation rate for GLP-1 can be as high as 68%. That seems a little bit higher number versus what we are hearing from docs. So, just wondering if you can expand on where the number comes from and maybe bigger picture why that matters and implications for your program.

No, absolutely. So, starting with the HD program, obviously, as Anne-Marie pointed out, the key for us is delivering key biomarker data demonstrating that we can achieve, like we thought it's important to remember in the single-dose data, 35% reduction versus placebo. So, we've seen knockdown of the mutant protein. We've seen that we did that in a way that was wild-side sparing. So that was the early clinical data at a single dose. I think what we've also subsequently and importantly, received from Takeda as we reported in the fourth quarter was a $7 million milestone payment on achieving distribution study showing that we could actually target at therapeutically relevant concentrations drug in the right region of the brain that should be targeted for HD. So, as we put these data together, the key for us is to deliver now the multi-dose data demonstrating that package. And that's the package that's required to be submitted to Takeda. I think we're focused on doing what's best for the program. We're generating that data. We'll be working with them collaboratively. And just a reminder, so when that package gets submitted, it's our discretion to the package. Takeda then has an evaluation period with which to decide [indiscernible] comes with a payment, that would be a substantial payment on supporting our contributions to the clinic, and it be switched over to a 50-50 R&D split, profit split with additional milestone payments along the progress of the program. So, I think step one for us is deliver data that we think -- whether it's Takeda, we began to deliver a package that we believe is the right package, which this program should move forward or not. And so, I do think about this coming data set an important decision point for the program. So, this will decide whether or not the program does have the data with which to support moving forward or not. As it relates to your question on the discontinuation rate, there was a -- and again, there's -- as you said, there's reported how do physicians and various surveys report out. This was based on an analysis of a claims database following how many patients are staying on it. And so, with the prime therapeutic analysis with a claims database, looking at patients staying on. So, you think you always point in time. People use them in different ways and report different ways, but this was -- we can let use surveys and look at the published numbers. So, this is based on published analysis.

Very helpful.

It's important. And I think it's -- I mean I think that's the fundamental question, whether it's 68%, 70% some people say even -- I think the ultimate question is why are people dropping off a medicine that has the effect that it does. So, I think we think about this oftentimes is shifting the narrative from what's weight loss versus what's healthy sustainable fats. And so, the opportunity we have in front of us is human clinical genetics to induce a phenotype that is about healthy weight loss independently or most importantly, as it was pointed out, I think earlier in one of the questions is thinking about how these will be used in common practice. And I think with the real opportunity in front of all of us is people will use GLP-1s for induction weight lost. And I think the key is how to move people and migrate people from GLP-1s as a chronic therapy where they increase their risk by staying on it of complications in sarcopenia so ultimately saying after that induction phase, how can you have sustainable maintenance bad-offs in a way that once or twice a year, subcu injection and provides all of this continued cardiovascular benefits and diabetes risk benefits that have been seen in the U.K. Biobank clinical data. So, I think that's why that data is important for us is being able to see that there's a substantial opportunity not just from the front end, but really on this capability to transition patients to this therapy.

Our next question comes from Andrew Fein with H.C. Wainwright. Your line is open.

Thank you. I will focus on the DMD program. And I was just wondering, given the DMD landscape and the new data coming out from SRP-5051 or DYN-251, how do you see your DMD program differentiates from the current developments in the landscape? Thank you.

Great question. I mean, and obviously, this is something we focused on at the very beginning of our journey in DMD, which was we needed to see several things to bring this program forward into the clinic to begin with. And I think to your point on differentiation, first and foremost is the production of functional dystrophin vector like dystrophin as the core driver. So that's important, right? That was, one, an important constraint. Two, we wanted to see high levels of muscle concentration, meaning high levels of muscle concentration that Huntington productive, meaning they get to the right compartment of the cell. That's what we see with the highest level of exon skipping at 53% skip transcript. I think that combination, coupled with the data that we're going to have in Q3, which will be the 24-week data, where we can now have over at the same time as the commercial products within the 53 landscape will give us a benchmark of that translation, meaning strong functional dystrophin like numbers that would support moving forward and potential registration. I think all of that also comes with another point of differentiation, which is not just on the number of dystrophin, but where dystrophin comes from. So, what we've seen is both in the double knockout mouse. We saw it in the knockout mouse. We saw it in our nonhuman primate distribution is higher levels of skip drug in the heart in the diaphragm over skeletal muscle. So, I think as we think about the progress with the boys, one of the key features that we focus on is respiratory and cardiac function. So, the ability to get into tissues with exposures that help [indiscernible] key point of differentiation. I think as we think about the early development, too, so young…

And I'm not showing any further questions at this time. I'd like to turn the call back over to Dr. Paul Bolno for any closing remarks.

Thank you all for joining the call this morning. We believe 2024 is going to be an exciting year for Wave, and we look forward to keeping you all updated on our progress. Have a great day.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect, and have a wonderful day.