All right, thank you for joining this afternoon, the first day of the Oppenheimer Healthcare Conference. My name is Franc Brisebois, I'm one of the Biotech Analysts here at Oppenheimer. Our next company presenting is Lineage Cell Therapeutics. From the company, we have CEO Brian Culley to present. What we'll do in terms of format is Brian will present for about 20 minutes, and then we'll go into some Q&A. Feel free to send me questions in the Q&A tab at the bottom of your screen or by email. With that, we'll jump right into it. Brian, thank you for joining, and I'll let you take it away. Thanks, Franc. It is really my pleasure to join today. I thought I'd start a little bit differently and just kind of provide some sort of broad comments. Before I do, I just want to remind everyone, as we're a public company, I may make some forward-looking statements throughout this presentation, and please refer to the risk factors that we provide through the sec.gov filings. Stepping back, I'm going to talk a little bit for just a couple of minutes about cell therapy. Cell therapy 20 years ago was promised to cure everything: autism, ADHD, and a laundry list of indications. It has not and some people consider that to be a failure, but they might be forgetting that cell therapy has actually revolutionized cancer. It is one of the pillars of cancer treatment alongside chemo and radiation now. That is because there are certain advantages to using cells as therapeutics. Cells generally can be used as a one-time administration. That is the power of and excitement behind gene therapy. Cells can address many more pathways than small molecules or antibodies and look no farther than the rather modest clinical benefit in the approved agents for dry AMD to see what happens if you can only hit one pathway at a time. There have been recent breakthroughs 15 years on. I was very excited to see that Bayer is using a cell therapy in Parkinson's, and they have announced they are going to move to phase III. There was a lot of attention just a week or two ago around Sana in type 1 diabetes and the language that was being thrown around about a curative therapy. It is very exciting because this is really a new branch of medicine. I think it is important to keep in mind that while CAR-T, as a cell therapy, has been incredibly successful, it is a very crowded space today. I think the growth and the opportunity is in what we sometimes jokingly call noncology, right? That is everything other than oncology. Lineage has, I believe, the deepest pipeline in noncology, and it is mostly in neuro. I look forward to the opportunity to talk to you about that today. This basic approach, we talk about it in a cute little phrase called replace and restore. We identify where it is beneficial to replace cells in order to restore function. There are 200 cell types of the human body, and there are a bunch of different conditions and diseases, ailments for which replacing a certain cell type that's lost could be beneficial. We have a lead program that was partnered with Roche and Genentech, which helps provide validation to our approach. I really want to kind of walk through from the top level exactly how we go about this. The pipeline that we've developed has five assets. Notably, these are all allogeneic assets. None of these is a highly expensive, slow-turnover autologous therapy that's customized for an individual, but rather we're seeking to develop all off-the-shelf therapies in every case. We have what I think is a very nice distribution of risk from our phase II to earlier programs still in research and a nice smattering of partners and collaborators throughout this pipeline. To answer the question about what is the basic approach, it really boils down to just two steps. We start with a pluripotent cell line, and we expand that cell line. We grow the cells in numbers and o ne of the most powerful attributes of pluripotent cell lines is that they do not change as you expand them. The cells remain the same. They do not crash out the way that many mature cells will crash out after 40 or 50 passages. That means that we have, and others have, an endless supply of starting material. Our raw material of an undifferentiated stem cell is essentially infinite because you can just grow the cells, divide them, and freeze them back down. Your supply of starting material is fantastic, and this helps drive the affordability of this approach. The other attribute of pluripotent cells is that they have within them, by definition, they have within them the capability of becoming any of the cells of the human body if provided with the right instructions. That is our core technology as we provide these starting cells, these undifferentiated cells with the core information to differentiate into just a specific cell type. Schematically, it is shown by those sort of orange dots there on the right-hand side leading to neurons. You could refine that further to different specific types of glial cells and then beyond that into oligodendrocytes, etc. You can actually control through the normal developmental steps what kind of pure cell type you are producing at the end. That is your medicine. By the way, you can do this without gene editing. In order to really have a product, that process, that process development, you need to be able to meet these criteria. We sometimes call these the table stakes, right? If you want to play for the pot, and the pot being the addressable market, you have to come in with the table stakes, the ante of being able to control your process, reproduce your process. You need to demonstrate the purity and identify the identity of your cells, the potency of your cells, and the scalability. You know what's not on here is the clinical data. That's because that's where the attention often lies. It almost goes without saying you have to have the clinical data. I think one of the challenges in trying to select the winners and losers in the cell therapy space is investors paying attention to all this stuff behind the curtain, which really is necessary in order to have a successful product. It's just simply not enough to show exciting clinical data. You need to be able to make your material and demonstrate that you have control over that process and that you can do so affordably. OpRegen is our lead program, which I think has demonstrated this capability in a very clean and convincing way. OpRegen is an RPE cell transplant. We manufacture these specialized cells of the retina. By transplanting those cells to the back of the eye, we've been able to show that we could improve not only the anatomical structure of the retina, but also the function, i.e., patient vision. This led to a worldwide collaboration we have with Genentech, a member of the Roche Group. It was a very significant partnership. I know that many cell therapy companies struggle to land pharma partnerships. I think the fact that we have attended so much of our time to the manufacturing side of development, not just the clinical side, may reveal an explanation as to how we ended up with such a promising and capable partner. We actually extended this partnership. There was an additional service agreement that we announced with them in the first half of this year. We continue to be very pleased with the partnership that we have with Roche and Genentech. The focus is in ocular disorders, but specifically, we're talking about atrophic AMD. This is where the loss of retina cells is causing vision loss. Many people are familiar with the tremendous financial and clinical success of wet AMD, but most people, eight times more people, most people develop dry AMD. Until the last couple of years, there have not been any therapies available. None of those therapies have been able to improve vision. That is our goal. We manufacture RPE cells, which are the cells that are lost in this disease, and we transplant them. We just put them back. This is like a replacement part for your car. We are manufacturing in the lab RPE cells, and we transplant them to the patient's eye in order to give them back the functional cell type that they originally developed. This is very different than squirting undifferentiated stem cells into someone's vein, right? This is much more like a bone marrow transplant where you're replacing the necessary cells that perform a specific function in the body. We conducted a 24-patient phase I/II-A trial. The first 12 patients were all about safety. They were legally blind. We didn't expect to see much, and we didn't see much. When we went into the next 12 patients, these are patients that look more like what we think of as customers. These might be patients that are on complement inhibitors and things like that. We were really excited that in particular, the patients that received our cells right in the area of atrophy, so this is delivering the cells directly to the area of injury, those patients did extraordinarily well. Those are the patients that exhibited the anatomical improvements to the retina and increases in vision. It is really important to keep in mind because human beings do not regrow their retinal tissue. You do not spontaneously cure yourself from dry AMD. Over time, you only lose vision. When we are bringing patients' vision after 12 months or 24 months, when we are showing durable changes to their retina structure that is essentially transplanting that material durably and irrevocably into the host, those are attributes that cannot happen and will not show up on a control arm of a clinical trial. Let that kind of soak in when you think about statistical power. All right, what exactly are we seeing? This is not our definition. We have a similar definition, but this is Genentech's definition for how they scored or graded improvement to retinal structure. It starts to get a little technical, but the punchline here is that you can draw these pretty pictures. You can colorize them, digitize them, and you can graph them. You can show that the anatomical evidence or the structure of the retina can be improved over time. The upper lines, you can see that they're broken down in this cross-section. This is high-resolution OCT imaging. After three months, the retinal tissue looks normalized. These can also be mapped. You can do densitometric analysis, and you can look at the RPE-d rusen complex. You can look at the external limiting membrane. There's a little bit of a video running as you do the cross-section over time. That is to demonstrate that these are not individual, highly selected snapshots of limited or localized areas of improvement. This is happening 360 degrees around the area of atrophy, principally around the penumbra, principally around the area of damage where the photoreceptors are not completely destroyed, but are still fighting for activity. This has been really powerful to show that even two years out, these anatomical improvements have been present. I'm going to move kind of quickly so we can get to some Q&A later, but this did not happen in just one patient. Here I'm showing these are the five patients in our trial. The only five patients that received the cells across the area of atrophy, those were also the only five patients that exhibited what we call retinal restoration. It really was a one-to-one correlation that if you put the cells not in the area and hope for some trophic effect of these cells, but if you literally transplant RPE cells into a patient's subretinal space, that you can improve the structure, normalize the structure, and increase vision. These are some more refined details that Genentech has taken our raw data, done their own independent analyses, and presented these data, reiterating what I am saying about the ability to improve the anatomical structure and also that it is correlated with extensive coverage of the cells across the area of atrophy. Now, this gets really exciting because although the precedent for approval in the United States is anatomical change, we actually showed that patients increased vision. These are patients' study eye and untreated eye. Please do keep in mind that untreated eyes are generally, or they need to be, would necessarily be the better eye at baseline. The study eye is always the worst performing eye. You can see that these patients at 12 months or 24 months had gained five, six, seven letters. In contrast, if you follow a patient, not their fellow eye, but you follow a normal baseline matched patient with no treatment or with treatment, so on complement, this is a Lancet publication, you would expect at two years that those patients would lose seven, eight, or nine letters. There are 1,200 patients in that Lancet publication showing that that is what you expect at two years. We are showing patients that have gained five letters. That is a 13-letter difference. Again, this never happens naturally. This is not patient selection. This is therapeutic conviction. The extensive and limited coverage led to Genentech being very interested in different ways of being able to deliver the cells to the subretinal space. We were happy with the safety profile. We've never had any cases of rejection of our cells. We've got well over 100 years now of exposure. The old fears that people have around cysts and blindness and things, I'm sorry, but we've just never seen that in our hands with really abundant follow-up. The study that's running right now, as I was alluding to by Genentech, is actually a surgical optimization study. This is looking at different ways of delivering cells to the subretinal space. The reason for that is that we demonstrated that getting cells to the best target area led to the best clinical outcome. Genentech, thoughtfully and appropriately, is looking at different methods and tools and techniques to be able to deliver the cells to the target area, which we believe will increase the risk-reward of this therapeutic and ultimately lead to better clinical outcomes. OpRegen is a multi-billion dollar opportunity in the setting of dry age-related macular degeneration. I think a lot of people are really interested in seeing how this next study will go and whether or not Genentech will elect to move into the next study beyond that, which we would expect would be a comparative or controlled study. That's a quick walk through our replace and restore strategy. In the last five minutes, I just want to say a few things about additional indications that we're working on in other places where we believe that cell transplantation can drive significant clinical outcomes. Relevant to this morning is our OPC1 program where we transplant oligodendrocytes. Thirty patients have been treated to date, and we just launched an additional clinical trial in this indication. Obviously, what we're looking to do here is to increase mobility and freedom and flexibility for individuals who've suffered a paralyzing spinal cord injury. The idea here is instead of making RPE cells, we manufacture oligodendrocyte progenitor cells, which are the myelin-forming cells of the spinal cord. We treat patients with a subacute injury three to six weeks after their injury, although I will note that for the first time, we also will be treating chronic injury patients which have had an injury one to five years prior. Mechanism of action, probably multiple factors, but we really think that remyelination is critical here. We also, in the first phase I study that was conducted by a different sponsor, saw some evocative functional data. It was very interesting that almost everyone had some improvement in their status. We think that there's a signal here, and we're really excited to investigate this further and make some definitive statements about how much benefit patients may enjoy from receiving an oligodendrocyte transplant. If we can move them from, for example, C4 functional to C6, you could reduce the burden for caregivers by an extraordinary amount. Frankly, about 1/3 of the patients in our study did have this level of increase. It was also profoundly well tolerated. Out of over 500 AEs, there was only one that was potentially related to OPC1, that was a grade 2 dysesthesia, which had self-resolved. We really think one of the great advantages here is the high tolerance of transplanting cells. We also saw very high engraftment. Most of these cells were able to help prevent syringomyelia, which is a complication that patients with SCI development. All of this work has been published. I want to move to two things. One is we have vastly improved the manufacturing. These are levels of impurity of cells in gray from the original clinical material. You can compare that with the levels of impurity in the stuff that we can make today. We continue to work on this. This is a real core competency for Lineage is our ability to control manufacturing. This is in bioinformatics data. It is essentially showing the same thing. I mean, the original stuff was pretty good. I think the patients that I've talked to are pretty happy with it, but it would be nice to get rid of things that you don't want, like some of these epithelial identity cells. We've been able to do that, and we're looking forward to introducing these cells into the clinic. First, we're introducing a novel delivery system. The old way of delivering the cells was this big scaffold, this apparatus. It'd sit above the patient, and you had to disconnect the patient from the respirator while you were administering the cells because you can't have them breathing and moving the position of the needle in the spinal cord. This new apparatus attaches directly to the patient. The ventilation can continue. The cells are pushing along through the flow path into the point of injection and to the area of damage without disconnecting the respirator. We think it's a lot easier to use. We think it's going to be safer, and it's going to be compatible with a new formulation, a thaw- and- inject immediate- use formulation where we can get the cells into the patient after just five minutes of thawing instead of literally hours of washing and rinsing and counting and all the dose prep that went on in earlier studies. Again, highlighting our commercial thoughts with respect to product development. This study was announced to be initiated. It was announced this morning. It's going to be three to five subacute and three to five chronic injury patients. UC San Diego is the first site. We have additional sites that will be coming on. Really excited to get this program back into the clinic. Actually, if you're really keen on that, there was a really nice CNN story that came on when talking about one of our patients. I'd refer you to check it out. The last minute, I just want to say that there are some additional blue sky things we're working on here with photoreceptors and auditory neurons. This is a really important area because we're trying to replicate or repeat the success we had with transplantation in our clinical programs with new areas like auditory neurons that, much like dry AMD, the hearing loss space has suffered by a number of well-known failures with small molecules. Perhaps replacing the cells that are dysfunctional or absent could be a more powerful way of driving a functional benefit. We have been able to manufacture these cell types, and we're putting them through some preclinical testing now. We're really excited. We've seen some migration. We've been dropping them right into the modiolus or the scala tympani, and seeing some really nice durability of these cells in these preclinical models. Of course, our ultimate goal is to move this into the clinic where, frankly, in a phase I testing, we might be able to get some functional evidence. That's another nice advantage about this setting. Photoreceptors is another ocular area. It's not partnered with Roche and Genentech, so we retain the rights to do some things on there. We've started to work on an undisclosed indication using a hypoimmune cell line. This is a cell line that maybe could be utilized in non-neurological indications as well as neurological indications, basically deleting the signals that allow the body's immune system to destroy the transplanted cells. As we go further and we have more evidence and things to talk about, we look forward to rolling this out because I think this is the future, frankly, for cell transplantation is to engineer in genetic capabilities that the native cells do not normally possess. This is sort of the future frontier. First, show that you can replace your cells and restore function, and then start to put in cells with certain capabilities that are beyond those that are natively found. I think this is how you build a really big and very successful dominant company. The company is well capitalized. We did financing not too long ago and just really focusing on execution. Franc, with that, hopefully that worked out. Looked like 20 minutes or 21 minutes. If there are any questions, I would be happy to address those. No, that is great. Thank you very much, Brian. I was wondering why the lead program in ophthalmology, why start there? How did that come about? Where did it start? Was that the question? Yeah, like why choose dry AMD or ophthalmology kind of stuff? You know, it predates me, but there's this fellow named Ben Reubinoff at Hadassah Medical Center in Israel, and he developed a method of manufacturing retinal cells from undifferentiated stem cells. He thought that that was a cool idea, and they started a company. It actually goes back close to 20 years or so where the original intellectual property and the original invention to make a retina cell was conceived and thought of in the early heydays of cell therapy as an interesting way to treat dry AMD where you benefit from things like having immunoprotection, right? You do not have a lot of white blood cells in the eye to blow up your transplant. You can also see what you are doing in the eye, right? The imaging technology allows you to really track what is going on. It was sort of a really well-thought first initiative for cell transplantation. As it made its way into the U.S. and got some U.S. clinical evidence, eventually it caught the attention of Roche and Genentech, who I think really understood that the only way that you can improve vision, which is something that, of course, patients would want, is to go with a transplant approach. Everything else is about slowing the disease progression, but if you want to reverse it or halt it, you are going to need to do something other than just hit a pathway. Okay, great. No, that is super helpful. On a different program that you mentioned a little bit, this morning, you guys announced that you're initiating the clinical trial in spinal cord injury. Can you just walk us through some additional aspects of that protocol and how it kind of fits in your development plan? Yeah, this has been an interesting program because we acquired it from another sponsor, and we knew that it had some deficiencies. There were manufacturing problems, scale problems, delivery problems. Frankly, we didn't have to pay all that much to acquire it, but we did it because we thought we could fix those problems. Our manufacturing team had so much success with the RPE program. We wanted to apply those techniques to the oligodendrocyte program, and we've been very successful. We've been able to clean up, as you saw in one of the slides, we've been able to clean up the material, make it a much healthier. I don't know if it's going to be more active, but definitely a cleaner population of cells. The scale increased vastly. I'll tell you, actually, the original banks of cells that we got were something like 9% pluripotent, right? So there are all sorts of, let's call it dead cells floating around in the original banks. The banks that we've recreated now are north of 90% pluripotency. Even just that step gives you almost a 10x magnification of your starting material, which allows you to carry through and multiply that as you do your production. There were all these problems with the program, and I think we're really well along in addressing them on the manufacturing, the new delivery, and then ultimately, we need to ask the question about whether we think there is a benefit not only in subacute setting, but also in chronic. It's not knowable. Fortunately for us, there's not a tremendous amount of competition with cell transplants. There's brain interface like Elon Musk's Neuralink, and there's a new company that just got approved for a device called Onward. There's a lot happening in the space. The space is maturing, and the endpoints are getting more sensitive. We're really excited because, to our knowledge, we are the clear leader in cellular transplantation to the cord. This next trial is an important step in demonstrating that we can have a commercially viable way of delivering the cells. Strategically, is the point to do this by yourself to go into this disease and commercialize, or is the partnership route kind of what you guys are more comfortable with? That's an excellent question. I really think the right answer is that our goal is to create value. Depending on how the sector is doing, how macro factors are going, the prices that people are willing to pay, I don't think you can answer it on any given day. We did the deal with Roche and Genentech because we think that they're probably one of the best one or two companies in ophthalmology in the world, and it was going to be really difficult for us to compete commercially in that space. Spinal cord injury is a little different. It is viable. It is possible to, it's an orphan indication with subacute, so it would be more realistic. It's not like you go to Pfizer and they've got a field force of 120 people calling in on the docs. I really don't think that we are going to make definitive statements about the business model because if someone comes in and offers us something we think is good for our shareholders, we're going to pursue it. If they don't, we're only going to work on things that we think are valuable internally. Thereby, we're maintaining the optionality that I think we need. I don't know. We could get a phone call tomorrow from someone who says, "I really want to do something with this program," and we're going to entertain that, but we'll only do it if we think it makes sense for the company. Okay, great. Maybe lastly, in the last couple of minutes, I think you wrote a letter to shareholders last month or not too long ago, which talked about some of the milestones and manufacturing stuff that you're working on. Is there anything else that you want to add there? Any kind of anything you were hinting at in that letter? Yeah, that's a great final question. Yes, this is something that kind of drives me nuts, which is there's a lot of talk about allogeneic therapies, and I get really frustrated because sometimes an allogeneic therapy is like grabbing a leukopak, harvesting T cells, and maybe you can scale to like 10 or 100 patients, but that's really not solving the cost. From my perspective, an allogeneic therapy is one that is truly off the shelf, right? You're pulling cells out of a freezer, and they're the right cells for millions of people. That is really success. In order to do that, you have to have a master cell bank that itself can generate a working cell bank that can generate the product because if you did 100 cells of each of those, it's 100 times 100 times 100. Now you're really cooking. I think that as far as we know, no one's been able to do that in a GMP setting. I actually am really excited, and I hear competitors and comparable companies like Sana talking about the challenges they have in generating the scale to be able to supply a market. I think we're well on our way to doing that. I'm really trying to help the investment community that might be newer to what the modern situation is with allogeneic therapy understand that being able to have that kind of banking and control and production is ultimately necessary for winning in this space. I think we'll have some really interesting things to say about that this year. We've had some breakthroughs and milestones, and I'm excited to talk about them as soon as I'm comfortable doing so. Excellent. No, it's definitely a big part of the story here, the manufacturing side. Really appreciate your time, Brian. Hopefully, this was helpful to all the listeners listening in. Thank you. Thanks, Franc.