Avidity Biosciences Inc Stock

Good morning, and thank you so much for joining us today. I'm Kat Lange, Chief Business Officer at Avidity Biosciences. Today, we are excited to share the first functional data from the EXPLORE44 open-label extension study of Del-zota for boys and young men living with DMD44.

Before we get started, I would like to share that this presentation contains forward-looking statements as defined under applicable law. Forward-looking statements involve risks and uncertainties, both known and unknown, which may cause actual results to differ from the forward-looking statements contained in this presentation. You are cautioned to not place undue reliance on these forward-looking statements and to refer to the more detailed cautionary language in this slide and in the Risk Factors sections of our recent reports filed with the SEC.

And with that, I would like to hand it over to our CEO and President, Sarah Boyce.

Thank you, Kat. Our vision at Avidity, as you know, is to profoundly improve people's lives by revolutionizing the delivery of RNA therapeutics. This morning, we're going to focus on DMD. And this morning, we're going to share with you how we're actually redefining what is possible in DMD. Joining me on the call today is my colleague, Steve Hughes, our Chief Medical Officer, and I will have other colleagues join us for the Q&A portion of the meeting.

At Avidity, we're now gearing up to launch 3 drugs, all in the same therapeutic space in the neuromuscular space, Del-brax and Del-desiran. Del-brax is for the treatment of FSHD. FSHD is a large rare disease, was estimated to be about 45,000 to 87,000 patients, people living with FSHD in the U.S. and Europe. And we are on track to be the first ever globally approved drug for this disease.

Del-desiran is for the treatment of myotonic dystrophy. Myotonic dystrophy is also a large rare disease with estimated about 80,000 people living with myotonic dystrophy in U.S. and Europe. And again, we're also on track to be the first ever globally approved drug for this disease and a drug which clearly has a best-in-class profile for myotonic dystrophy.

Now moving to focusing specifically on DMD. As we all know, DMD is a devastating disease that affects young boys and young men and results in loss of ambulation typically by the teenage years and a significantly reduced life expectancy. It's estimated that for boys and young men amenable to exon 44 skipping, there's about 900 in the U.S. and about the same in Europe.

What we're going to share with you today is unprecedented data. What we're actually seeing is functional improvements, and that's improvements across all key measures demonstrated at 1 year. So this is for boys and young men who had enrolled in the EXPLORE44 study and gone on to the open-label extension study and are now out at 12 months of treatment. We're also going to share with you the compelling biomarker data of muscle health. And this is looking at creatinine kinase. What you have seen before is the rapid, significant and sustained reductions in creatinine kinase. We're going to show you what this looks like out past 16 months.

And this is the aspect of really when you can protect muscle fibers over the long term, what's possible? You can get improvements. We're also going to share with you the continued favorable and safety tolerability profile with most TAEs being mild or moderate. We are, as a team, extraordinarily focused on making sure that we can get Del-zota to boys and young men living with DMD amenable to exon 4 (sic) [ 44 ] skipping as quickly as possible. That route is through our BLA submission. We are on track to file our first BLA as a company. So this is the first of 3 in a 12-month period, but our first BLA as a company year-end of this year and launching in 2026.

With that, I am now going to hand over to Steve, who's going to take you through the data. Steve, over to you.

Thank you, Sarah. Okay. If we can move to the next slide, please.

Today, I'm extremely excited and privileged to be sharing the functional endpoint data from Del-zota in the EXPLORE44 program in DMD amenable to Exon 44 skipping. But first, I'd like to take a few moments to remind you of the study design and the biomarker data and then as always, the safety data from the EXPLORE-OLE study.

The first study, EXPLORE44 is on the left of the slide. It was randomized, double-blinded and placebo-controlled and involved 26 boys and young men with DMD44, 19 on Del-zota and 7 on placebo. All participants received 3 doses of either placebo or Del-zota at 5 mg per kg or 10 mg per kg. Muscle biopsy was performed 1 month after the last dose and participants then had the opportunity to roll into the open-label extension, which is in the center of the slide.

And here, they all received Del-zota. Participants initially rolled over on either 5 mg per kg or 10 mg per kg, depending on what dose they were on in the parent study. But you'll recall that at the end of last year, we agreed with FDA that 5 mg per kg every 6 weeks would be our go-forward dose for potential accelerated approval. So since then, all participants in the OLE have moved to the dose regimen. We've also enrolled an additional 16 participants with DMD44 in the open-label extension to bring the overall safety database up to 39, but these new participants are purely contributing to safety. They're not having muscle biopsies because we've already aligned with FDA that the dystrophin data we have is sufficient for BLA filing.

So in total, we have 39 boys and young men with DMD 44 that received Del-zota. These span a broad age range from 7 to 27, both ambulatory and non-ambulatory and also a range of different mutations and most were receiving corticosteroids. Functional data we'll be sharing today comes from the 1-year time point in participants that have had at least 1 year of continuous treatment with Del-zota at either 5 or 10 mg per kg. So they've completed the EXPLORE44 study and had several months of follow-up in the open-label extension study. Safety data, as always, comes from all participants, including the 16 new participants.

Next slide, please. You will recall that we shared the top line safety data from EXPLORE44 earlier this year. At that time, all of the boys had already finished EXPLORE44 enrolled into the OLE. So there's no new data from the EXPLORE44 to share today. So the data we are sharing is an update from the OLE with a very recent data cut of June of this year. The long-term safety of Del-zota continues to be extremely fairly favorable. 39 patients enrolled in the OLE, including 23 that rolled over from EXPLORE44 and the 16 new participants. Most adverse events have been mild or moderate. The most common AEs, i.e., those occurring in greater than 3 participants are those that are frequently seen in any clinical trial, even in placebo arms.

There have only been 3 participants that experienced a serious adverse event and only one of these, which was a moderate hypersensitivity was deemed to be related. Two unrelated serious adverse events were a fractured femur and a suicide attempt. The hypersensitivity was not atypical in any way and was not associated with changes in vital signs or oxygen saturation, but did result in the patient being withdrawn from the study.

Next slide, please. Before moving to dystrophin expression, I'd like to just remind you of a couple of important nuances. Not all dystrophins are created equal. The dystrophin gene shown at the top of the slide is one of the largest in the genome with 79 exons, and it codes for a large protein with many different domains, which have important functions in terms of muscle health and function. The dystrophin that we make by skipping EXPLORE44, as you can see in the middle of the slide, is a near full-length dystrophin and as such, retains the functionality of the protein. In contrast, and as we can see at the bottom, the microdystrophin made by gene therapies is only about 30% of full-length dystrophin protein and therefore, sacrifices several of dystrophin's functional domains.

Next slide, please. On the left is the dystrophin data that we shared with you back in March, and it's very clear that Del-zota is producing unprecedented levels of near full-length dystrophin. At both the 5 and 10 mg per kg doses, we get around a 25% increase in dystrophin levels, which takes these boys on average to dystrophin levels of over 30% of normal. And to put this into context, female carriers of DMD have about 50% of normal dystrophin and typically are asymptomatic. So with Del-zota treatment, we're approaching levels of dystrophin that are associated with a normal phenotype. And of note, we have not adjusted this data for muscle content. These are just the values from the western blot and normalized to myosin heavy chain.

The right side is showing new data. Here, we see the percent positive dystrophin fibers on muscle before and 1 month after 3 doses of Del-zota for a representative patient. Not surprisingly, given the very large increases in dystrophin on the western block, the increases in dystrophin positive fibers is very clear to see. Also, you'll notice that the fluorescent is around the muscle cell membrane, indicating that the dystrophin is correctly localized within the muscle.

We've already seen earlier this year that this high level of dystrophin production resulted in near normalization of multiple markers of muscle health, including CK, myoglobin, ALT and AST, showing for the first time in DMD that Del-zota is protecting muscle fibers and damage. In the next slide, we'll see how the large reductions in CK that we observed are holding up over the long term.

Next slide, please. I think the conclusion is that they're holding up very well. Here, we see that out through 16 months of treatment, we're maintaining near normal CK levels. And because CK is a biomarker for muscle damage, this confirms that Del-zota continues to provide long-term protection from further muscle damage. Notably, at the 1-year time point, about 50% of participants had CK levels within the normal range. In a moment, I'm going to show you how this long-term protection is translating into improvements in functional measures. And in order to put these improvements into context, we've compared with match patients from the PRO-DMD-01 natural history study. Next slide, please.

I would like to draw your attention to the right of the slide. PROTEC-DMD01 is a prospective natural history study following 269 boys and young men with genetically confirmed DMD. In order to ensure as much of an apples-to-apples comparison as possible, we selected participants from natural history to match as closely as we could for those in the EXPLORE44 OLE, and we were able to match 22 natural history participants based on being DMD44 skip amenable, aged 7 to 27, on steroid treatment for -- and a stable dose for at least a month and body weight greater than 23 kilograms.

On the left of the slide are the baseline characteristics for the key assessments and these tell us a few things. Firstly, when time to rise from floor reaches about 5 to 7 seconds, ambulation declines meaningfully over a 1-year period. So based on the high value of the time to rise and other ambulatory measures at baseline, these boys will be expected to decline significantly over the 1-year period.

Secondly, although generally well matched, the participants in the EXPLORE44 arm are worse on all measures at baseline and therefore, be expected to decline more quickly than the natural history group. This is important because it makes the data I'm about to show you even more remarkable.

Finally, the assessments on this slide are all measures of ambulation. So these assessments are all in ambulatory patients only. Out of the 17 participants in EXPLORE44 that had reached a 1-year time point, 12 were ambulatory, but one had a fractured femur and another had sprained his ankle. And therefore, 10 participants in total are included in these assessments of ambulation.

We've also looked at the pool in both ambulatory and nonambulatory patients to assess upper limb function, and I'll show you this a little bit later. And remember, we've pulled the 5 and 10 mg per kg patients for all of these analyses since the amount of dystrophin restoration and CK reduction was essentially the same at both doses.

And now what you've all been waiting for. I'm extremely excited to show you how this long-term protection for muscle fiber damage is translating into improvements in functional endpoints. Next slide, please.

On all of the functional endpoint slides I'll show you, the 0 on the figure represents baseline. Moving to the left is a reduction from baseline or worsening of disease and movements to the right are improvement. Here, we see [indiscernible]. And I think it's very clear to see that Del-zota patients are showing an absolute improvement of greater than 2 seconds, whereas natural history, as expected, are declining quite a bit by greater than 2 seconds. So relative to the natural history, Del-zota is leading to close to 5-second improvement. This has never been seen before. And remember that to do this test, boys not only need to be able to walk, they need enough strength to be able to climb upstairs. Next slide, please.

Now the 10-meter walk run test. And here again, we see absolute improvement in the Del-zota-treated boys compared to declines in natural history. And compared to natural history, the Del-zota-treated boys are improving by around 2 seconds. Next slide, please.

And here, the time to rise from floor. Note the time to rise from floor is a complex test. So although the boys are still ambulatory, not all boys were able to get up from the floor. So we only have data on 6 for Del-zota and 19 for natural history on this assessment. Consistent with the other measures of ambulation, substantial absolute improvements in the Del-zota-treated boys are seen compared to a decline in natural history with an overall nearly 5-second improvement with Del-zota compared to natural history. Again, improvements that have never been seen before. Next slide, please.

The North Star Ambulatory Assessment is the last of the ambulatory measures. Here, we only had data on 20 boys from natural history. Again, we see improvements relative to natural history with an overall improvement of about 2.5 seconds. So we're seeing very consistent and quite honestly, quite unprecedented improvements in all of these functional measures. Now we'll look at upper limb function. Next slide, please.

So here, we're looking at the performance of upper limb 2 test and the results shown for the pooled ambulatory and non-ambulatory patients. When we look at them individually, there's no difference between the non-ambulatory and the ambulatory for the improvements. The pool is not included in the PRO-DMD or 01 natural history study. So for this comparison, we've used the published literature for a comparison and the citation is at the bottom of the slide.

There are 27 EXPLORE44 skip amenable boys from natural history and 17 treated with Del-zota. And we can see that consistent with the ambulatory measures, upper limb function is also improved for Del-zota boys. And in comparison with natural history, this improvement is over 2 points. Next slide, please.

And finally, an overall summary of what we shared today. As you can see on the right of the slide, we see consistent and clinically meaningful improvements across multiple functional endpoints, assessing both upper limb and lower limb function at 1 year. We've seen large and statistically significant dystrophin increases, delivering sustained improvement in CK and long-term protection of muscle from contraction-induced muscle damage. We've also seen very favorable long-term safety and tolerability.

So for the first time, we've been able to show that large improvements in near full-length functional dystrophin are associated with sustained long-term muscle protection with subsequent reversal of disease progression as compared to natural history.

I will now hand back to Sarah for closing remarks.

Thank you, Steve. Go to the next slide, please. What we've shown you today is really part of this ongoing revolution that we're leading in what's possible in RNA delivery, redefining what can be possible for boys and young men living with DMD. What we've seen is unprecedented functional improvements, which is essentially reversal of disease progression for boys and young men amenable to EXPLORE44 skipping. That's a big statement to be able to say for DMD.

You also see the compelling biomarker data of muscle health when you can get those unprecedented levels of dystrophin that we were able to achieve creatinine kinase and the other markers of muscle health go down, stay down. And when they do that, you can actually get people doing more. All of this is with a favorable safety and long-term tolerability profile. We are 100% focused on the importance of the jobs that we need to do in getting Del-zota to this community as quickly as possible. That's part of our commercial readiness.

And also, we're finalizing our confirmatory Phase III study design with regards to bringing to Del-zota to boys and young men around the world. We are on track to submit our first BLA as a company by year-end. The functional data clearly further reinforces the potential for accelerated approval as well as also the work that we're doing to prepare the global development pathway. Essentially, part of this is often boys living with DMD and men living with DMD are referred to as DMD boys. Our goal is where they just become boys. And that's doing things like jumping on surface, skipping, being able to reach up and get stuff, being able to gain and really looking at redefining what's possible for DMD.

We're now going to move into the Q&A portion. And I'm going to have Steve join us back on screen; Mike Flanagan, our Chief Scientific Officer, I know you all know well; as well as Kat Lange, our Chief Business Officer, who you all know, also join us back on screen, and we'll move to questions.

All right. Thank you, everyone. We've got a number of questions coming in here on the portal. I'm go ahead and take through a few of those. Our first question comes from Eric Schmidt at Cantor.

Great to see patients on Del-zota gaining function as opposed to a reduction in rate of decline. So we have a 2-part question here. The first part for Mike, how do you think about the biology underlying this observation?

Yes. So I think once again, we've connected the dots, right, from delivery where we see unprecedented delivery to production of dystrophin, that dystrophin being nearly full length is really important, and that leads to the sustained and significant decreases in CK, which gives you that muscle protection. And then what you saw today was from Steve looking at the long-term functional improvements that we're seeing. So again, it's that connection from the delivery, our ability to now deliver RNA to muscle, and we've shown that across 3 different programs to that effect on the target to the effect of the downstream biology and then that biology turning into functional improvement. So it's really -- I mean, you don't see this that often. It's pretty exciting.

Excellent. And then the second part of the question for Steve. Should we expect gains to continue over time?

Yes, we're not seeing any reason why these gains can't continue to improve. I mean the real thing here is just providing the long-term protection from further contraction-induced muscle fiber damage. And we're seeing already that through 16 months. These boys are down near or within the normal range, reflecting that long-term protection. So as the protection stays out through the long term, we would anticipate that we would see further improvements in muscle strength and function going out over time.

And then our second question comes from Joe Schwartz at Leerink. Joe said, congratulations on the data. Thank you, Joe. The question goes to Steve. Is the methodology for the natural history control arm consistent with how the FDA would like it done in a propensity matched or weighted manner?

Yes. So as you can imagine, we extracted 22 participants that we were able to match for the comparison. DMD44 is only about 6% to 7% of the total. So within that natural history study, there are actually only about 27 or 28 DMD44 participants. So really hard to do things like propensity matching. We just have to work with the tools that we got.

But they were well matched at baseline for important characteristics from our eligibility criteria. We saw on the baseline characteristics slide that they were pretty much similar in age and that on all of the functional measures at baseline, actually the Del-zota-treated participants were worse at baseline than the natural history patients, which means that the Del-zota patients would be anticipated to progress even more than the natural history over that 1-year period in the absence of treatment. So any biases that are inherent and the results actually biased in favor of the natural history, not in favor of Del-zota.

And then our next question comes from Geoff Meacham at Citi. This one goes to Sarah. Sarah, you're planning to file 3 BLAs over the next 12 months, beginning with Del-zota by year-end 2025. Could you comment on how these successive launches could build upon each other in terms of awareness of Avidity AOC products and the commercial infrastructure of a rare disease launch?

Yes. Thanks, Jeff. And good to see you covering us again. So in terms of -- from an aspect, one of the most important elements to understand here is that each launch is synergistic with the other because this is in the same therapeutic space, so in the neuromuscular space. In the case of FSHD and myotonic dystrophy, essentially, there is 100% overlap in the potential prescribing physicians.

So what we're able to build is a very efficient commercial organization, obviously, starting with Del-zota and DMD, where there's also the pediatric neuromuscular specialists. We are very far along on that. We have our MSL team in place. We have our patient services organization now building all of the infrastructure that will be required. We have a site of care team in place. We have a payer team that is already on the ground in the U.S. as well as also having a marketing team and a market access team also in place.

So a big part of all the infrastructure of the commercial organization is already up and running. And a big element of this, when you look at what we're doing is really unprecedented. From an aspect of these are 3 successive launches, all with the same commercial organization and all in the same therapeutic space. So it's all in the neuromuscular space. So I think suffice to say, in the neuromuscular world, people are going to know us pretty darn well from an aspect of being able to deliver 3 drugs to this community to really make a profound impact on people's lives.

Thank you. And then our next question comes from Ritu Bal at Cowen, and this one goes to you as well, Sarah. Has there been any meaningful review of turnover in your Cedar neuro division at FDA?

Great question, Ritu. And the answer to that is no. So one of the other aspects of the synergy from one program to another is they're all reviewed within neuro division I. There's a lot of the same people across the different review teams. We've worked with them for a long time now across all 3 of our programs and speak as you would expect, very often.

The team has remained -- is in place. It's all consistent. They are very thoughtful with and helpful with their input. They're timely with their feedback and really are focused on doing their job around also getting drugs to patients. So we are very grateful for the collaboration that we have with the division and with all the work that we're doing with them.

We have a second part to the same question from Ritu. So Sarah, given the strength of the functional data, will you approach Europe about approval?

It's a great question, Ritu. As we've known with regards to -- for dystrophin and there is not an accelerated approval pathway in Europe. We did actually -- on the data that we've already seen back last year with dystrophin, we don't have a conversation with EMA about the possibility for some sort of conditional approval in Europe just based on the dystrophin. The answer was no and that we would need to show functional data. So that's where we're now in the process of locking down our global confirmatory study design. And it would be our expectation that, that would be required.

We are also a team that always believe in going back and having another conversation, and we will also -- we do also plan to do that with EMA based on the data that we've seen. But I would say our expectation is that the global confirmatory study will be required.

Our next question comes from Yanan Zhu at Wells Fargo. Steve, we have a 2-part here for you. I'll start with part 1. Congrats on the data. Could you describe the bar of a clinically meaningful difference for each of the functional endpoints reported?

Yes. So the clinically meaningful and important differences for this disease as we look through the literature have really been calculated based upon standard deviation or standard error or fractions of those. So we didn't include the NCIDs on the slide because the regulators really like for these differences to be calculated using anchor-based methods. In other words, by showing correlations with patient-reported outcomes where the differences are known.

For time to rise based on the literature, around 3.5 seconds; 4-stair climb around 2 seconds, 10-meter walk/run around 2 seconds are what we found in the literature for the NCID studies. So we've exceeded on all of the measures, the NCID as compared to natural history. North Star 2 points change is taken to be a clinically meaningful change. So there, we also were beyond the clinically meaningful difference that we could find in the literature.

Great. And then the second part of the question, do you expect the MSAA endpoint to show improvement from baseline with longer-term follow-up?

Yes. Certainly, we anticipate that the ambulatory measures and upper limb function will continue to improve over time. The problem with the North Star Ambulatory Assessment, and this has been reported widely in the literature is sensitivity. So at baseline, the average North Star score for the Del-zota-treated patients was 19. Now it's -- the maximum score you can get is 34. It's a 17-point scale and patients score from 0, i.e., they can't perform the test or either a 1 or a 2. And the 2 is essentially normal.

So with a score at baseline of 19, it means that on pretty much every single assessment, the Del-zota-treated participants were scoring a 1. So in order to show improvement on that test, they have to basically go back to normal. Now that may well be possible over time, and we certainly hope that they can do that. But in a 1-year time frame, that's just really difficult to see on the North Star. And we're not the only sponsor that's up against this lack of sensitivity for that test in these shorter duration studies.

Next question comes from Gena Wang at Barclays. So Steve, this is one for you. Can you elaborate on the FAE of hypersensitivity related to study drug? When was the onset? How long did it last? And how was it resolved?

Yes. So this was a classical infusion type reaction. So it occurred during the infusion. It was actually the third infusion for this participant. It occurred a few minutes into the infusion. It was moderate in severity. There were no atypical features. There was no difficulty breathing. There was no tissue swelling. There were no changes in blood pressure. There were no changes in oxygen saturation.

The infusion was stopped and the patient made a full recovery within a few minutes of stopping the infusion. They were treated with some Benadryl. They didn't require any admission to hospital. They went home, and there were no long-term sequelae. So it's unfortunate that the participant was discontinued from the study, but really, this was just a typical reaction that you can see with biologic drugs sometimes.

And then our next question comes from Keay Nakae at Chardan. Mike, this one is for you. What is the read across this data to your other DMD programs such as DMD45?

Yes. So for DMD45, as you know, is our next -- is an IND enabling. So that will be coming towards the clinic in the near future. The other exons, we're working on in the lab currently. We have really good sequences, the PMOs we've selected, and those will be moving forward. We're really looking at also platform designation to look at those moving forward.

And just to give you a sense of what we're anticipating for these is that given what we've seen to date for 44, we anticipate that the other exons will also perform really well. And when asked about this, we don't know exactly what it is. But even if we saw 1/3 as much dystrophin production, that would be still well north of 10% expression of dystrophin, which I think puts you in that category where it's maybe not a normalization like we're seeing for 44, but it clearly puts you in the Becker's range.

So for our exons that we're moving forward in the future, we're really looking to make that profound improvement in patients' lives. And we believe that, that is producing dystrophin at a 10% level or above and that's what we've done today.

And then our next question comes from Corinne Johnson at Goldman Sachs. Steve, can you provide more detail on the process and time lines for receiving platform designation and how that could enable faster development time lines across a broader DMD population?

Yes, that's a great question. So in order to get platform designation, one of the drugs in the platform has to be approved by FDA. So the timing for us applying for the platform designation is after we actually get the BLA for Del-zota. We will be spending that application around as soon as possible because, as you know, it is incredibly important for the development of our subsequent exons.

Once you have platform designation, there are a number of potential ways in which it can accelerate the development path. First on the CMC side, you can leverage your prior CMC work with your other exon skippers to reduce the regulatory burden as submission for your IND and also subsequent regulatory submissions. On the tox side, you can leverage your prior toxicology studies to start your clinical trials. So that allows you to move to start clinical trials more quickly.

And then within the clinical trial itself, you can start certainly at higher doses than you have to for your very first drug and ideally start even at your target dose. So that really reduces the burden on the clinical trial. And then at the time of application for BLA, then you can leverage your prior safety database. So that potentially reduces the number of participants that you need to have in your clinical trials for subsequent drugs in order to file for BLA. So multiple, multiple different efficiencies there that we would be looking to exploit as we move the exons forward.

Great. Thank you, Steve. And then we're actually coming up to our last question here. This one goes to Mike. Can you discuss the impact of Del-zota on CK levels in non-ambulatory DMD44 patients?

Yes. As you can see from the data, and again, it kind of comes back to that connecting the dots. It's that you see rapid and sustained improvements in CK, and that's across ambulatory as well as non-ambulatory. And you can see that the error bars are really small. And 50% of patients, and that includes both ambulatory as well as non-ambulatory are in the normal range. That's unprecedented. That's really muscle protection occurring because we're making so much dystrophin, and that's leading to those functional improvements.

And for the ambulatory boys, like a 10-year-old boy, once they're starting to feel better, you are not keeping them down, right? They're going to be running around. So that is a sustained level. It's not that you're seeing like, "Oh, they're running around and starting to use their muscles more, then you see a bump in CK." It actually stays down. And that really leads back to the delivery, the expression of dystrophin, the effect on CK and the functional benefit. And you're just seeing a completely different story than you've ever heard before of the effect of dystrophin and the long-term effect on muscle protection leading to this dramatic improvement. I think it's just -- you don't get to see this very often. So it's exciting.

Thank you, Mike. And that concludes the Q&A portion of our webcast. I will turn it back over to Sarah for closing remarks.

Thank you, Kat, and thank you, Mike and Steve, for joining us for Q&A. Thank you, everyone, for joining us this morning. And I hope we once again have shown you how we're delivering on our vision to profoundly improve people's lives by revolutionizing the delivery of RNA therapeutics. And today, we have essentially redefined what is possible in DMD. Thank you.

Good afternoon. Thank you for coming to the Morgan Stanley Healthcare Conference. My name is Rock [indiscernible]. I'm a Managing Director in the Investment Banking division at Morgan Stanley. I just have a brief disclosure to read. For important disclosures, please see the Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representatives.

So today, we have the pleasure of hosting the management team from Avidity. Thank you so much for coming. I know this is a busy conference, so I appreciate you coming. Perhaps before we get started, would you mind doing a quick round of introductions, please?

Sure. Hi, I'm Kath Gallagher. I'm the Chief Program Officer at Avidity.

And I'm Mike MacLean, I'm the Chief Financial Officer.

And I'm Kat Lange, Chief Business Officer.

Great. Before we jump into your various programs, could you remind us where your pipeline currently stands? And the most important catalysts you're looking forward to in the next 6 to 12 months?

Yes. First of all, thank you very much for having us here at the Morgan Stanley Conference. This is our inaugural Morgan Stanley conference, and we're very happy to be here. So as we sit here today, I kind of just remember back like 5 short years ago, we went public and we were a preclinical company. And now I'm about to walk you through what our next 12 months look like. And we actually sit here with 3 late-stage clinical trials. And we're looking forward to 3 BLA filings in a 12-month period starting this year. At the end of the year, we'll file a BLA for our first product, del-zota for patients with DMD44. And this will be eventually our first launch product. We expect to launch that product in 2026.

And then we'll have 2 other BLAs for our del-desiran product and myotonic dystrophy and our FSHD product, which is del-brax. And those will both be filing BLAs in the second half of 2026. So it's really amazing to be sitting here 5 years later looking to 3 potential launches by the end of 2027.

More near term, what we're looking for is what we're going to execute on is data readout from our del-zota trial this month. And this data readout will be for functional data, and our EXPLORE44 LLE, it will look at participants that have been on drug for 12 months, 6 months in the EXPLORE44 trial and another 6 months in the LLE. And that adds to really unprecedented dystrophin data that we showed earlier as well as bringing down CK to near normal levels and sustaining it there.

Also in the fourth quarter, we'll be disclosing our data from our MARINA-OLE, and this will be for participants who have been on the drug for 24 or more months. And what we're looking to show there is consistency in terms of our ability to reverse disease progression and sustain it. Also in the first half of 2026, particularly Q2, we will be showing the 30-week cutoff data for the efficacy in our HARBOR trial. So our HARBOR trial is in for myotonic dystrophy, it's for our drug del-desiran.

And it's a 54-week trial, but at 30 weeks, we will have completed all of the efficacy testing or measurements. And so we expect to disclose that we have met our primary endpoint and the p-value of that. Of course, the trial continues since it's -- there would only be week 30 and it continues till 54. So it will still be a blinded study, and we will be able to disclose more once that study is completed.

And then also in Q2 of 2026, we'll have completed our FORTITUDE biomarker cohort. So this is for our FSHD program with the product del-brax and this is going to be a completed study for a biomarker accelerated approval program. So in Q2 of 2026, we will show all of the data from that study. And as we do all that, we continue to progress forward with other neuromuscular programs, precision cardiology franchise and bring forward our next-generation products.

Great. So over -- since long before going public 5 years ago, what have you learned across your muscle programs about their product design, long-term safety and dosing?

Kath, would you like to answer that?

Sure. I'm happy to. It's always fun. Thank you for the question on the AOC platform. We don't get it all that often. For people who are not as familiar with Avidity, AOC stands for antibody-oligonucleotide conjugate. And for all of our programs that are currently in the clinic today that Mike was just going through, they all utilize the same monoclonal antibody and the same linker and what changes for each is the actual therapeutic. So for 2 of those programs in FSHD and DM1, we're using an siRNA and for DMD, we're actually using a PMO for exon skipping.

In terms of what we've learned, it's been a pretty incredible amount. And I guess we're both wax and philosophical today because I'm also looking back on being here 4.5 years. And almost like to the day, 4 years ago is when we started to dose our first patient in the del-desiran trial of MARINA, and we went into that with this incredible set of information, but we also went into it knowing nobody has ever done this before. We were the first AOC ever to enter the clinic. And so there were a lot of lessons that we did have to learn in order to kind of keep the platform going and also to learn from so that as we think about our next generation of technologies, we'll build upon that.

Some of the key things that 4 years later, we are now dosing -- and this is a really important statistic. I don't think people fully appreciate this, but we are now dosing about 30 patients a week on average across our platform. So that is a tremendous amount. And we have also over 250 years of -- 250 patient years. And so we've learned a lot in terms of safety.

I think one of the other big learnings that we have taken in is our understanding of how siRNAs work slightly differently when they're going with delivery to muscle. And so when we went into the clinic, we anticipated, for example, that we'd be doing every 3-month dosing. That was kind of based off of what we saw in nonhuman primates, what we knew about siRNA therapies beforehand. And what we learned through the MARINA program, but we've also now seen with the del-brax and del-zota programs is that we're dosing more frequently. And thanks to the safety profile that we have all this data on, we're able to do that.

So for HARBOR, for example, in our DM1 program, we're dosing 4 mg per kg every 8 weeks; for del-brax 2 mg per kg every 6 weeks and for del-zota 5 mg per kg every 6 weeks. So we've really been able to learn a lot and kind of leverage that knowledge across the program. And just last year, we started talking about our next-gen as well. And the data we have collectively across the 3 programs is really helping us to figure out now that we've had this like kind of leading the field pace with our first 3 programs, what are the things we want to do and insert into our later-stage programs as well.

Got it. Maybe now starting to get into some of your programs. And I know we just touched on a lot of it. For -- maybe starting with DM1, vHOT is the primary in HARBOR and handgrip QMT and DM1 active as secondary. What is the right composite to capture the disease change and progression and what magnitude would you consider clinically meaningful based on your MARINA-OLE learnings?

So first, before we get into answering the question directly, I just want to kind of point out that this was our first program that we launched. Of course, I talked about del-zota and DMD being our first product, but DM1 and what we're going to talk about here in terms of influences where we've been blazing the trail into an area where although there's been some understanding of the biology of the disease, we've been part of figuring out that out and figuring the biology out and how to treat the disease and really dealing with the ambiguity of the biology, the regulatory pathway. And now we're starting to think about how to bring it to market. So with that, I'd ask Kath to answer the question.

Sure. So, we designed the HARBOR program so that we are really looking at the key aspects. I love that you call it a composite because not to be confused with the composite endpoint. But we really have always looked at this as a totality of data. Now the HARBOR trial is the first-ever global Phase III study in myotonic dystrophy. And so to some degree, there is a fair amount of responsibility in that, right? When you're leading the field, you want to make sure that you're really testing the right endpoints and that you're getting the right patients in that trial. And so we've spent a tremendous amount of time with the patient community, with the physician community -- the global physician community.

And how we came to these end points was really an understanding from the DM1 community itself, that myotonia is, of course, important. And I think a key point in thinking about vHOT is that vHOT is not just measuring hand function, right? So myotonia is throughout the entire body. People have it in their tongue. It makes it difficult to swallow. They have it in their legs and makes it difficult to walk. They have an impact from sleeping. I mean it is a truly systemic challenge.

The easiest way to really measure that is through video hand opening time. So vHOT while it is measuring the hand, is really giving you a lot more information because it's also helping us understand systemically, are we targeting the splicing changes required for to make an impact on myotonia. So that we put is our primary endpoint. We got a tremendous amount of input on it, and it's really a key hallmark of the disease. But in addition to that, and it being a really great functional endpoint, we also wanted to look at strength, which is another really important piece of this disease, and that's where we have our handgrip coming in as well as QMT, and of course, there's a big deal in all of this, which is how do the patients feel on drug.

And so our other endpoint is the DM1 active which is a PRO that's in the study as well. And when you kind of look at these together, collectively, it's a total package for the DM1 community. And we believe and we designed it this way that it's not only going to help us with our regulatory path, but it's also a reimbursement path too. And key to all of this was getting regulatory input, and we have done that across the U.S., Europe and Japan. and have gotten full alignment around this design and vHOT as the primary.

Got it. And I guess from your perspective, what secondary endpoints are you most confident in hitting stat stig and least likely to hit stat stig?

I'm confident in hitting all of them. I really do feel strongly about that, was in full disclosure, I was the global program head for this program. So it is near and dear to my heart. But when you really look at the MARINA data, which is our Phase I/II data, we saw something that you just don't expect to see in the muscular dystrophy, which is reversal of disease progression. And we saw that across all of these endpoints. And so we do have -- we're pretty bullish going into our Phase III top line based on the data we've seen and also based on -- we have a tremendous amount of natural history data that we've been able to use to help us look at that and also to power it properly. So the study is really well powered for all of these endpoints.

Okay. With DM1 cardiac burden, how are you tracking all the cardiac endpoints or biomarkers as part of the HARBOR trial?

So somebody asked me earlier today if there's one thing I wish I could do differently. And my answer was, I would love to be able to track cardiac, but the HARBOR trial is not the place for us to do that. And we had a lot of discussion around this. The reason is that cardiac is a huge piece of the disease for these patients. And part of why I'd love to track it is because we know we deliver to the heart. So we know del-desiran actually can get there and can have an impact. But this is a rare disease. These patients have nothing today. And so as we designed this trial, it was about getting to the market as fast as possible. But I do look forward to actually studying some of those things in the post-marketing setting, for sure.

Got it. And can you talk a little bit around your decision to use an siRNA in this indication as well as your choice of dose and the dosing interval?

Yes. Actually, Kat, do you like to talk?

Yes. So this is something that we actually have a lot of experience that this team has a lot of experience from prior companies. siRNAs are just really good at knocking down genetic targets. And one of the things I was really missing from the field and one thing that Avidity has really been the leader in is taking the siRNA into tissues outside the liver. So we had a very strong hypothesis that if you get sufficient concentration into the muscle tissue, that these siRNAs would work incredibly well in these types of diseases. So in this case, DM1, it's all about the DMPK knockdown, which then leads to the freeing up of the muscle bind protein that has all of these downstream effects on splicing and really [indiscernible] a hallmark of the disease.

So what we're seeing with the AOC deliveries is a very nice increase in the muscle concentrations of the siRNAs, and that was really the choice that we made. And then as Kath touched on in the preclinical models, we thought we could really get to a quarterly dosing schedule for every 13 weeks. And one thing that we noticed in the MARINA Phase I/II study is that, that was not quite frequent enough to really get the benefit to these patients on a consistent basis and really sustain that benefit.

And it's something that we even heard anecdotally from patients that a couple of weeks before the next dose, they would feel a waning of effect. So it's really important for us that we took the anecdotal evidence together with some of the biomarkers that we've seen into account to really optimize the dosing and evolve. So that's how we've ended up at an every 8-week dosing interval here for the del-desiran program.

And I would just add that siRNAs are extremely safe. And they're also potent and durable. They are the right oligo to pick for this disease.

Got it. We've touched on some of the upcoming milestone events already. So maybe we can just talk a little bit around the disease prevalence. So you've framed the opportunity as 80,000 individuals across U.S. and Europe. Now -- but they are much higher estimates. Now -- at the same time, there's an argument that some of these individuals may not be motivated to seek treatment. So how will you segment the population while addressing awareness -- building -- addressing awareness, building awareness and also the diagnosis rates?

So I'll take that one. Look, this is a very large rare disease, right? 40,000 patients in the U.S. as rare diseases go is pretty significant. And what we're finding in terms of -- is that number appropriate? Is the size believable? And everything that we've seen is that, yes, this is approximately the size of things that we look to is the major medical centers where these people end up. There's an NDM1 study that has enrolled over 500 patients into a natural history study. And as we conduct our clinical trials, MARINA and HARBOR, the level of interest in the engagement in this patient community to be part of these trials is pretty healthy, like we are not finding apathy in terms of trying to come into the trial.

You can see our HARBOR trial was enrolled on target and on time in a 12-month period. And so everything we've seen is that that's the right patient size. This is an engaged patient population. Is there a symptomatic apathy for the patient? Yes, we understand that's part of the disease, but it's really not part of their behavior towards treatment. And that may not be solely related to the patient. These patients are part of families that have this disease in their family. So that is -- it's a community that helps this patient deal with the disease through their lifetime.

And when we talk to the patient advocacy group so passionate about getting treatment. And they deserve treatments, ours and others. And so as we kind of go forward on that basis, we see this as a patient population that's actively engaged. The uptake as we look at commercialization and the opportunity here, we're really pleased with the fact that we're going to be launching this drug globally, right? And by globally, initially, what I mean is the U.S., Europe and Japan. And all of those markets, we found great enthusiasm for the uptake.

So this will be our first global launch. And so we're preparing for that. And del-zota is our first U.S. launch, but we'll be launching del-desiran in the EU and Japan first, right, as a company. And so we're setting up everything for that. The supply chain, the commercial organization, the patient services function. So we're really excited about not just the 40,000 patients in the U.S., 80,000 includes Europe, but I don't believe that anything brings in Japan. And these -- that's a market that we've started the clinical trials there a year ago. And the KOLs there are thrilled that we've launched our global first full approval clinical trial in Japan simultaneously.

Great. Most companies would be done with the presentation now, but we've got to get through the rest of your program. So maybe shifting to del-brax in FSHD. Can you talk about your biomarker approach?

Kath, do you want to talk about that?

Sure. Of course. So we -- just this past June, we announced that we have a circulating biomarker, which we refer to as cDUX. cDUX is targeting a gene -- gosh, KHDCL1 close. So we named it cDUX because it is quite challenging to remember the actual name of the gene. But it is a very well-known gene in the FSHD space. And it is something that people have been studying for quite some time. We had been looking at it in our muscle biopsies as well. The thing that Avidity really discovered is that you can also measure it in blood. And that really is a very exciting thing for the community. The real insight around cDUX is that when patients have high levels of cDUX, they actually have a more severe version of the disease. And so we're kind of looking for an inverse correlation here.

We want to decrease cDUX so that we can see more improvement with del-brax. And so what we did last year is we kind of wanted to look at FSHD as a whole. And we got our first data set back in June of 2024 looked at that and said, we need to move this drug forward as quickly as we can. And so what we did, as we kind of call it at risk, as we initiated the FORTITUDE biomarkers trial, which is about 50 patients. And that one is our accelerated approval trial. That one we initiated in last November, and we fully enrolled it this past March. And that is what we are looking to have readout next year. A lot of the questions we've been getting around what functional data do you really need to show?

The functional data is not necessary, right? This is an accelerated approval path. So it's not that we don't have to hit statistical significance on our functional measures here. What is important is that we're able to correlate cDUX with function. And so that is the work that our team is doing right now and kind of again paving the path for FSHD to really bring to this treatment to patients. At the same time, we have launched our global Phase III study called FORTITUDE3, and that has just opened and started enrolling this year, and that will be our functional trial that we would go for a global approval with.

Got it. While we're on the point about cDUX and function improvement, what -- can you elaborate on what additional work you still need to do to prove or show that correlation work by the time you go for a BLA submission?

Of course, sure. So we've already done a fair amount of work using the FORTITUDE data that we have, which is the dose escalation cohort that we presented earlier this year. And we've also utilized our natural history data, which we have a tremendous amount of -- I mean, in FSHD and DM1, the investigators have just been an incredible source of -- they were really strategic in setting up these natural history studies. So there is a tremendous amount of data we can utilize from RESOLVE, MOVE, MOVE PLUS. So now what we are really waiting for is the data from the actual biomarker cohort, which will allow us to really kind of fulfill the work that we're trying to do.

The other things that we have to do between now and BLA are things like that you just need for an accelerated approval, like what CMC do we need to have, things like that to make sure that our submission is fulsome and ready to go.

Got it. in case you didn't bump into Commissioner Makary, what feedback did you receive from the FDA when you learned that the accelerated approval pathway was opened and announced that you had achieved significant -- you had achieved alignment with the agency around the regulatory strategy?

How about -- maybe I'll take that one and then -- so I think one thing that people haven't focused on is Kath just talked about how we were already doing the biomarker cohort. So the way that we set up our conversation with the FDA was we actually went and got approval of the confirmatory study design. And I guess one other thing that's important is that the part of the agency that we deal with, Neuro Division1 and CDER works with us across all of our programs. And so we had a conversation with the team at the FDA on confirmatory trial design. And then when that was approved, we went back, and we had a conversation with them on the biomarker accelerated approval design and process.

And so a lot of the questions that you would typically have been answered as part of our confirmatory study. And -- so there, we were able to spend time on really the 2 pressing issues, which is how do you prove that the surrogate can be linked or correlated to benefit? And as Kath just said, how do you show that you're going to be ready to produce commercial level inventories in time. So most of our discussions were deep in those areas, which is really what we call alignment with the FDA.

Got it. What are the planned disclosures around the FORTITUDE biomarker cohort in the second quarter of '26?

Kat, can you talk to that?

Yes, absolutely. So in the second quarter of 2026, this trial would have been completed. So if you recall, we completed the enrollment in March of 2025. So by the time we get to the Q2 readout, all of those participants would have rolled over into the OLE if they so choose. So at that time point, we can actually disclose all of the primary and secondary end points, including the p-values and then, of course, also the safety profile. So that is really the totality of the data package that will go into the BLA submission in the second half of next year.

Yes. Maybe one more on FSHD. So you've provided a wide range for the prevalence in the U.S. and Europe. Now what sort of data support both the low end and the high end of the range? And can you speak to the interest in del-brax from the FSHD community, both here and abroad?

Absolutely. So this is, I think, out of the 3 indications that we're pursuing probably the least well elucidated prevalence figures, as you can imagine. The ICD code has been around for about 5 years. So it was launched right about the time of COVID, which is very unfortunate just in terms of gaining data from the ICD-10 databases. But we believe in the U.S., there are about 5000 patients that have already been identified and diagnosed with FSHD. So that is actually a pretty good number for the total size of the indication that we're looking at, which we believe to be at least similar to DM1, if not slightly larger. If you look at the genetic studies, there are a lot that would tell you at least 40,000 in the U.S., if not higher. And we're doing a lot of that work at the moment in order to prepare for the launch that we're anticipating here relatively soon.

The interest has been just tremendous. We're getting multiple e-mails per day, not just for FSHD but also for the other programs, but I think FSHD really has been notable in just the motivation and the excitement from the patient community. And the big part of that is also the patient advocacy group, the FSHD society has been very active as well. So they're very good at getting the patients overnight, educated about potential clinical trials, treatments that will be available soon, but they're also driving a really big diagnosis effort that we think is going to really help us here. But overall, just as you would expect with a lot of rare diseases, as treatments become available, you will start finding even more patients.

Got it. Now shifting to del-zota and DMD. The EXPLORE44 showed an increase of 25% of normal in dystrophin at 4 months and almost near normalization of CK. How are you thinking about how to translate this into functional signals?

Interesting, you should ask. We have guided, as I said at the top of this meeting that we've guided that we're going to be giving functional data this month. And we think that that's really important for the community to really understand how this therapy could benefit them in their how they can live their lives. And so with the strong dystrophin, a 25% increase from 7% to 32% that we demonstrated and bringing down and sustaining to normal levels, we should see functional benefit. The original trial went 6 months, and we didn't think that we would see functional benefit that soon. So back last December, we said, why don't we look at it at 1 year. And so we guided to the fact we would be looking to functional and are presenting sharing functional data around this time for participants who have been on del-zota for 1 year.

So here we sit at the eve of that disclosure. And we're really hopeful that we can actually connect the dots. That dystrophin leads to near -- like near normal CK levels and near normal CK levels so that you can see functional benefit at that point in time. Now importantly, we're applying to the FDA for accelerated approval based on a dystrophin biomarker as we're submitting the BLA at the end of this year. The functional benefit is not part of the requirement to submit that BLA. But we do think showing that functional benefit will be -- could be important to the patient community to understand the power that the therapy could have.

Thank you. Now shifting to your commercial strategy. When it comes to your prelaunch commercial preparations, what elements are del-zota or DMD specific? And what are anticipated to support all 3 programs? Now can you maybe discuss the top priorities between now and the del-zota approval?

Yes. So literally, Rock, we started building our commercial organization quite a while ago. We've actually built the patient services organization. We have MSLs in the field. We have payer reimbursement specialists who've been talking to those parties, and we're in the process of building the site of care team. And so that's all either built or underway. And then the next thing is the sales force in the field. And we have done the market research to understand that 75% of these patients are seen by 100 doctors, 100 specialists in the U.S. So we know where to go. We know what size team we need to get there. And so we are ready to go on del-zota. It's a bit of a gift to be able to launch your first drug in your smallest indication.

And remember, del-zota will be U.S.-only right, because it's an accelerated approval here in the U.S. But what it allows us to do is build that center hub with things like patient services, build the field team, get them to develop the relationships and understanding of the patients, the doctors, where these people go for their treatments. And then when we're ready to hopefully in relatively short order, launch our next 2 drugs for FSHD and DM1, these sales reps and others have developed relationships with the caregivers. And so they're going to just be adding into the conversation these other diseases that they treat.

Because these caregivers, these docs actually, there's pretty much 100% overlap between FSHD and DM1 in terms of their patients they treat and both DMD44 patients are treated by these docs, too. Some DMD44 patients are treated by pediatrics, right? So they're not necessarily an overlap there. So this is really powerful in terms of helping us build the infrastructure, helping us test the infrastructure, that it's sound, that people are doing the right things, developing the right relationships and then to leverage that for really incremental investment. Even though FSHD and DM1 are much larger populations, those potential drugs are going to be blockbuster in nature. the investment on top of the infrastructure is going to be relatively modest.

Okay. Maybe that's a good place to get to the last question. Now with $1.4 billion with the [indiscernible] of cash and a stated runway through mid-2027. Could you talk about some sensitivities in your assumptions. Just, I guess, conceptually, what is the shape of your financing trajectory once these products launch?

Kat, would you like to take that?

Yes. So Rock, you're correct. It's a very strong cash position to be sitting on today, runways to mid-2027. So that means we do not get all the way to profitability. However, once we launch these drugs with the market opportunities that we see we do believe we're going to reach profitability relatively quickly. So there's really a lot of things you can test in the sensitivity, but all of it means you get to profitability very quickly post those 2 big launches, and I'm talking about del-desiran and del-brax, specifically.

So with that being said, we are in a very strong position today, but we do also emphasize all the time that we just want to maintain a strong balance sheet, be able to execute on all of these drugs in the clinical trials as well as the commercialization globally. So we will be continuing to assess additional pools of capital that we can tap into and we're very blessed in the sense that we are going towards 3 commercial launches and a lot of different pools of capital will be available to us.

Great. Well. Thank you so much for your time today. I hope you enjoy the rest of the conference. Thank you.

Thank you, Rock.