Precision BioSciences Inc and Eli Lilly and Co In Vivo Gene Editing Collaboration - Conference Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Maury Raycroft - Jefferies, LLC - Analyst : Hi. Good morning everyone and congrats on the update today. Maybe to start off, so, for the strategy to use ARCUS to delete exons 45 to 55 and create sticky ends that can re-ligate to make the milder vector phenotype, can you clarify if there are any other therapies or technologies in the public domain using the same approach?

Question: Maury Raycroft - Jefferies, LLC - Analyst : Got it. And I'm also wondering how much did other Precision Bio capabilities play into Lilly's decision? I guess how much the delivery technology factor in and how much they're manufacturing in the IP positioning factor in?

Question: Maury Raycroft - Jefferies, LLC - Analyst : Okay. Thanks for taking my questions and congrats again. I'll hop back in the queue. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 20, 2020 / 1:30PM, DTIL.OQ - Precision BioSciences Inc and Eli Lilly and Co In Vivo Gene Editing

Question: Ben Burnett - Stifel Financial Corp. - Analyst : Hi. Thanks so much and congrats on this collaboration. I wanted to see if maybe you could talk about the delivery challenges as it relates to muscle, Derek. You gave kind of gave some color around that. But -- and this notion that overcoming this would potentially open the door to other muscle indications. I guess what are some of the solutions that you're exploring here with Lilly? And I guess you're expected to center around AAV?

Question: Ben Burnett - Stifel Financial Corp. - Analyst : Okay. Very helpful. And then, I also just wanted to see if you could comment on just how clear in the guidance that the FDA has sort of given just in terms of the types of data and assays that they need to see in order to sort of green light the systemic administration of this type of gene correction profile on people? Is there something that you're trailblazing with the FDA? Or can you kind of come back to where you said earlier, can you ride the coattails of what other programs have done particularly CRISPR?

Question: Ben Burnett - Stifel Financial Corp. - Analyst : Okay. Fantastic. Thanks so much.

Question: Raju Prasad - William Blair - Analyst : Hey. Thanks for taking the question and congrats on the deal. Maybe one on the DMD programs. So, (inaudible), the lead asset is looking at kind of exon's 45 to 55. Would going after other exon mutations be a different program in the deal? And is that kind of how we could think about it a little bit? Or I know, Derek, you mentioned that some of the programs are kind of testing different types of optionality of the ARCUS platform. Maybe a little more color on does it test different tissue types as well?

Question: Raju Prasad - William Blair - Analyst : Great. And one more if I may, it sounds like your DMD, obviously, AAV is the delivery approach. But we're also seeing obviously a ton of focus on LNPs with mRNA vaccines or RNAi therapy or CRISPR going into APTR. Can you just give a comment on LNP delivery just maybe for some of your liver-directed program?

Question: Raju Prasad - William Blair - Analyst : Great. Sorry. I mean one last one if I may? Matt, obviously, the in vivo program is -- programs are advancing -- multiple are advancing. Can you just maybe talk a little bit about resource allocation with PH1, hepatitis B, and then these programs? Do you still plan on exploring options for hepatitis to find a partner, just maybe a little bit of strategic resource allocation on your side given how many programs you're doing?

Question: Raju Prasad - William Blair - Analyst : Great. Thank you. Congrats again.

Question: Andrea Tan - Goldman Sachs - Analyst : Hi everyone. This is [Andrea] on for Salveen. Thanks for taking the question and congratulations. My first question is -- while recognizing that it is early, can you just talk about what needs to be done here before entering a Phase 1 trial? What the timelines might be? And then which age groups you're targeting particularly if you anticipate being able to treat a nonambulatory population?

Question: Andrea Tan - Goldman Sachs - Analyst : Got it. And then, Derek, maybe just one additional question for you, just if you could provide additional color and the nature of these other targets that could fall under the collaboration and where they might fit on that chart that you were mentioning given your comments that the targets could unlock additional program?

Question: Andrea Tan - Goldman Sachs - Analyst : Got it. Thanks so much.

Question: Tom Shrader - BTIG - Analyst : Hello. Good morning. Nice to see the editing side get recognized. A little bit back to the other question -- to the last question. Is this entirely in vivo deal? Lilly is involved in some stuff where ex vivo makes sense.

Question: Tom Shrader - BTIG - Analyst : Okay. And if can just -- this perfect re-ligation strategy, is this much easier to control with two nucleases than it would be with CRISPR and a couple of guide sequences? Is that a huge driver for this technology here?

Question: Tom Shrader - BTIG - Analyst : Right.

Question: Tom Shrader - BTIG - Analyst : Great. Thank you very much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 20, 2020 / 1:30PM, DTIL.OQ - Precision BioSciences Inc and Eli Lilly and Co In Vivo Gene Editing

Question: Gena Wang - Barclays - Analyst : Thank you. I would just maybe follow the previous question regarding the two cuts editing efficiency. Just wondering there are distinct -- these two cuts is spaced out really distant. And physically, these two sides, the sticky end, I will assume not very close to each other. The later question, if we go to slide 17, the first -- the left side of the chart, just wondering beyond -- first, what is the percentage editing? What is the denominator? Was that the total number of the cell? And the second, beyond the correct editing, what other editing products you've seen? For example, the sequencing grew back to the original site and also say translocation and I noticed this is using electroporation with the naked mRNA. If in the future if using AAV [Kelly] the ARCUS nucleus, do you expect to see actual integration from AAV which we saw in other -- large allogene editing?

Question: Gena Wang - Barclays - Analyst : Okay. Very helpful, Derek. I just want to confirm the two cuts they target [intra] area, right?

Question: Gena Wang - Barclays - Analyst : Okay. Very helpful. And then, second question is regarding the delivery. So, did mention liver that could be possible for -- sorry -- the lipid nano particle that could be possible for liver target delivery. Just wondering, have you done any side-by-side comparison -- compare your AAV delivery versus the lipid nano particle deliver to the liver? And then, I just wanted to know why AAV? Like for liver, you do have a neutralizing antibody. It depends on what AAV [use to let] that could be pretty high neutralize the antibody. So, you would exclude some of the patient population.

Question: Gena Wang - Barclays - Analyst : Okay. That's fair. Okay. Well, thank you and congrats on the partnership.

Question: Eric Joseph - J.P. Morgan - Analyst : Hi guys. (Inaudible) congrats on the deal and for taking the questions. Just to pick up on Gena's question in terms of the (inaudible) editing, I can see that you're seeing -- in terms of protein expression, can you sort of describe that in terms of the percent of normal dystrophin expression that you're seeing and sort of how much -- you're able to characterize how much greater efficiency in editing you -- well, number one, sort of what level of expression do you think it would be anticipated to or needed to get to that (inaudible)? And sort of what needs to be solved for additional editing efficiency? And then, my second question is, at least with this first program and DMD, you're doubling or tripling down on using ARCUS to do sequence deletions. Can you talk a bit about the types of edits that are being pursued in the other candidate programs under the Lilly collaboration? Do any of them has a (inaudible) sequence insertions? And what's your latest thinking on the clinical feasibility of being able to do sequence insertions? Thanks.

Question: Eric Joseph - J.P. Morgan - Analyst : Quantity of dystrophin expression --

Question: Eric Joseph - J.P. Morgan - Analyst : Yes. Sorry. Yes. Sorry. Protein expression. Yes.

Question: Eric Joseph - J.P. Morgan - Analyst : Great. Thanks for taking the questions and congrats again.