Hey everyone, thanks for joining this session with Sana Biotechnology, and welcome to the 2025 Bank of America Healthcare Conference. My name is Alex Trenihan, Senior Biotech Analyst at Bank of America, and pleased to be joined today by Steve Harr, President and Chief Executive Officer of Sana. Steve, thanks for being here. Yeah, thank you for having me, Alex. Thank you to Bank of America for putting this together. Yeah, great. Thank you for joining us here in the audience. Great. Steve, maybe, maybe let's just jump in since we've got a shorter session today. You know, maybe we can talk about type 1 diabetes. I imagine this is the topic of the majority of your conversations with investors. Maybe, maybe just speak to the, you know, the recent 12-week data that we saw from the patient treated in this study and how this maybe builds upon the data we saw earlier this year. Yeah. A couple of things. First off, I'm sure you guys know we make forward-looking statements. We spend a lot of time on our risk factors, so take a look at it if you want to understand our risks. Take a step back. You know, diabetes is this very rare opportunity, right? It's this disease with, it affects about 9 million people globally. Patients live on average about 10 to 15 years less than they would if they did not have the disease. During that time, they have a very difficult day-to-day life. I think if you have any family or friends or you happen to be someone with type 1 diabetes, you know, it's on your mind all the time. They are at chronic risk for things like low blood sugars, and complications of high blood sugars like kidney failure or amputation, blindness, heart attack. There hasn't been a new drug really invented for this population since 1923 with insulin. It's a really, it's a big unmet need where we need to do better for patients. What we do know is, first of all, type 1 diabetes is a very simple biology disease in some regards. It's missing pancreatic beta cells. All right. I'm gonna talk about beta cells and islets. Islets are just alpha, beta, and delta cells. Just humor me and let me slip back and forth. I appreciate that. About 25 years ago, some people discovered that if you transplant islets, pancreatic islets from someone who recently died, cadaveric islets, that patients can be insulin-free. They can be insulin-free now, and there are people out 10, 15 plus years. Are there challenges with it though? The biggest one being that patients have to be on immunosuppression, and there just aren't that many patients who, for whom lifelong transplant-level immunosuppression is better than lifelong insulin, right? It's affected thousands of people, but not millions of people. The second is that the source isn't that great, right? It's not a scalable source. There's a lot of variability in quality, based upon, you know, the conditions of death when the patient died. Also, just did they have type, did they have some kind of like pre-diab, type 2 diabetes or other things? It works, but it's not great. A few years ago, Vertex and a few others started showing that you could take stem cells, make them into pancreatic islets, and transplant them into patients very successfully. I mean, I think their data are quite encouraging. There are, that's proved that that's probably a more scalable, it's certainly a more replicable supply source. You still have the challenge of immunosuppression. We've shown that we can get rid of, overcome allogeneic and autoimmune rejection in every preclinical model you can conceive of. We really wanted to see does this work in humans. We decided the fastest way to understand this was to gene modify primary islet cells or cadaveric islet cells and transplant them into a patient, you know, first at low dose. That's done in the arm of the patient. Very simple procedure. What we've shown is that we can transplant these islets and these islets survive and function. The patient's making his own insulin for the first time in over 30 years. He's now out. Recently we just gave the update, you know, 12 weeks with no sign at all of any immunologic response to these cells. I think it's safe to say, I've told you guys for a while, once you got past a month, there's really nothing, some new part of the immune, there's no new part of the immune system that's gonna pop up and become a problem. I think it's gonna just keep showing that this, these cells last, you know, as long as to keep 'em in there. That's not our product. Our product, what we wanna make it scalable, right? We're trying to treat a disease that's millions of people. This is a gene modified pluripotent stem cell. That's very difficult. You take it, you divide it into many, many cells and you differentiate them into islets. Finger guidance, and you transplant them in the arm. That is complicated, right? It has taken us a long time to get that ready. We'll get into it, but we're quite confident that we can have an IND next year and really begin treating people. When this happens, I do not see much risk to it working. I do see other risks. I mean, we have time and capital, there is safety, and I think there are some real challenges still to scale this. All of the component parts have been tested now, and so this should work. It should be something that is really transformative where patients reach our goal. Our goal is very simple. 'Cause what we've done with that, to put the pin in your question at 12 weeks, we've now shown it's possible to have, we put all the component parts to get people a normal blood glucose with no more insulin and no immunosuppression, and hopefully for life. Yeah. Yeah. That would. No functional cure. That'd be transformative. Yeah. For patients, no more insulin. It's probably the goal here. You'll continue to follow this patient simultaneous with scaling up SC451, which you said is, you know, the path forward. I guess maybe, you know, is additional follow-up beyond 12 weeks informative from that patient? Is there anything you're looking for there or, Personally, I don't think it's ever, it's not a risk, but I, you know, there are people who would love, we'll have six-month data, at ADA. You, there's an abstract that's been, and there's a, it's a plenary session, at the meeting on June 23rd. I'm sure that's a nice thing. We'll publish these data, I think in a very high-profile journal, which I think will help people as well to get their arms around. The biologic importance of this, I mean, this isn't just for type 1 diabetes. This is the first time they've ever had an allogeneic cells transplant into a normal immune individual with absolutely no immunosuppression. All right. This is applicable. The technology's applicable elsewhere. You know, hopefully that will, will, will be something we'll have the opportunity to push forward. Right now we're focused on type 1 diabetes. I'm sure everybody would like to see six months and then they'll wanna see one year. And there are people that take a, you know, the more they see, the more convinced they are, the more conviction they can have. You know, the immune system is, you know, relatively well understood. The immunology of transplant rejection, I think, is something that we have our arms around. I'm optimistic that there's not a lot that will change. Yeah. Yeah. Okay. That makes sense. I guess on the scale up, what's being done sort of as you're preparing for IND readiness? Yeah. I'm gonna use different words and scale up because I think there are two elements of scale. I've kind of outlined for people there are four big scientific challenges to make this a curative, broadly available medicine. The first is to overcome allogeneic and autoimmune rejection, so you don't have to give immunosuppression. We've done that. The second is to have a protocol where you can take a stem cell and make it into pancreatic islets at a scale that allows you to run a phase one study. We've done that. The third is to make a genomically modified master cell bank, so start with a single cell, literally one cell that, as you make trillions of cells, has a stable genome. That's been super complicated for us. I think we've now done that. We have a meeting coming up with the FDA to confirm that we agree on testing around a host of things, but I think that we've done that. That's all you really need to get to the first in human study. You have to do GLP tox studies and put it into a GLP manufacturing site. Those things are things we've done before. We just have to do with this cell. You then have the fourth challenge, which is to make this drug at a scale to be, you know, to treat a disease that has 9 million people. We have a long way to go on that. That's not something that we've done. In fact, it's something where there's very little investment inside the company around. It's not to say there's zero, but we'll have to, you know, there will be a multi-logarithmic change necessary to get at, you know, that market. Again, just to put perspective on this, let's be super optimistic for a second. We're gonna assume this is, we've really crushed it. It's one treatment. It works in everybody. They never have to get treated again. And we treat a, we've made, we've scaled it. We've made 100,000 patient doses per year. Put your price on that. That's a huge, huge drug, right? At the end of a decade, we will have treated just around 10% of the type 1 diabetics globally. You will have, right? Even that is not enough. That gives you just a sense of how much work we have to do to kind of get at this. I have yet to meet a patient who, if our drug does what we say it will do, does not want this drug. A single injection to the arm and euglycemia and immunosuppression. That does not mean every single person will, because we self, you know, you get selective for who comes to you. It is something where I think we have a lot of work to do to make it scalable. It will not be something where we can, you know, most likely satiate demand out of the gate. Yeah. That's a future problem. I mean, even more immediate, you know, we have spoken with a number of KOLs, who treat type 1 diabetes patients. And we have heard that there is really no shortage of willing participants for the clinical study, right? None. This is obviously not a rate limiting factor. As currently envisioned, right? I mean, I obviously, you know, we have work to do and we have to ensure there are not safety issues and things like that. You know, we get a lot of, you know, reverse inquiry for people who would love to be in the study when it does happen. I'm optimistic you can enroll something very quickly. Okay. What does sort of the scope of a, you know, a first or a phase one, for this program look like? Is it, you know, 30 patients, 40 patients? There is a company, a large company that's developing a drug in phase, a similar drug in type 1 diabetes. There are differences, right? Their drug requires, it's in a more severe patient population that we'd be going after. It also requires immunosuppression, right? And transplant. They actually had a patient die from the immunosuppression side effects. It's not, but they did a phase 1 study of around 15 patients, and they're doing a registration study of around 35 patients. Total exposure of about 50 is what they've articulated. I could make an argument that ours should be smaller, because we don't have the immunosuppression. I could make an argument that ours should be bigger because we're going after a broader patient population. Where it ends up, you know, we'll have to see, but I don't think it's gonna be an order of magnitude different than that. I think it's gonna be in the mar, you know, within an error bar of, of that type of number. You know, my guess is that the rate limiter to actually starting a registration study is having a manufacturing process that we've locked, that we're comfortable is good enough for the launch of the drug, right? It's not gonna, again, we're, it's gonna take time and I think many years to get it to something that is our optimal scale, but we want it to be good enough out of the gate, to, you know, have a, a meaningful impact. For the CMC, presumably for the submission, you would want it to be a similar manufacturing process. Has to be the same. Yeah. If it's not, I mean, you need to have, so if you think about, you really, with a cell therapy, it's gonna be very difficult to change your manufacturing process during clinical development, sorry, during your pivotal study, which means you have to have pivotal, you have to lock that process probably a year before you start to treat the first patient, just to give you a sense of the timeline. That's not that far away where you have to get to a pivotal process lock so that it doesn't, again, slow you down dramatically in the development of the drug. Okay. Okay. Maybe shifting gears, you do have other assets in the pipeline. Gleam and Vivid are two ongoing studies that could yield data later this year. I think based on your updated guidance, you know, maybe just walk us through these programs and what we should expect. Yeah. So Yeah. So another place, so another place to try to, you know, where we're applying this hypoimmune platform is in making allogeneic CAR T cells. I mean, I think many of you know the history of autologous CAR T cells. They're wonderful drugs. You know, they've struggled with scale, right? That, that's both in terms of reaching patients and also getting to a, a cost, a reasonable cost of goods. In the autoimmune setting, which is one place we're developing, there's an additional challenge in that patients have to come off immunosuppression to get the, to collect their cells, the original apheresis, and then they come back on their immunosuppression or they make the drug and they come back off. So it's a real burden on both the patient and the caregiver. What we're trying to, what we're doing is applying these hypoimmune edits to overcome allogeneic rejection and applying them to the CAR T space. We've shown you now that these cells are not recognized by the immune system. I think that's a real step forward. We develop a drug called SC291, which is a CD19-targeted CAR T cell in the oncology setting. It just, you know, it doesn't seem like that's a worthwhile place to go right now for us. We didn't feel that there was an adequate demand for it. I mean, at the end of the day, what we were finding, at least in the United States, was that demand for these drugs was not limited by manufacturing capacity. It was limited really by distribution capacity for physicians and hospitals and their beds. We were enrolling outside the United States. This did not have the capital to keep going forward, but we did learn some things, right? What we did learn is that we, and then what we talked about that's important for autoimmune is that we can get, we can safely get a dose-dependent and deep B cell depletion. That is the goal in the autoimmune setting, to get rid of B cells. Now what we need to show is that that translates in the autoimmune setting. I have been very clear. I mean, I think this drug works. I mean, what we do not know is it okay, good, or great. I kind of think of okay, like it works, but it is not quite as good as an autologous cell, but we are more convenient, right? Good, right? We're as good as an autologous cell and we're more convenient. Great. We're better than an autologous cell and we're more convenient. I think those are kind of the, the broad bands. I think we'll have enough data this year to understand, you know, are we one of, we'll get rid of one of the two ends. Are we kind of okay, good? Are we good, great? I'm not sure we'll have enough to know for sure exactly where we land. Partly that relates to the field's understanding of autologous cells is moderating as a, a modifying as we learn more about them. And partly it relates to just where we are in our own drug development. That's kind of that asset. You'll have to see where we go with it. The second is a CD22 CAR T cell for patients who have failed a CD19 CAR. People know about half of patients, or probably two-thirds of patients, do not end up with a long-term durable response. You know, CD22 in various settings has shown itself to be quite efficacious for those patients. Recently, there was a company that was developing a CD22 where they had very nice early data and late relapses. That has made our job easier from a perspective of enrolling patients. I think it has made it harder from a perspective of do we have something that is really long-term clinically meaningful for patients? Because we are going to need to follow patients for a long enough period of time to understand, is what we are doing different than what they did? Or is what we are doing going to fall into the same unfortunate biologic trap? You know, that's something we'll learn this year, I think. We may or may not know enough to know if we're truly different in the long term. I think that's something that will maybe take a bit more time. Because they, the recurrences were relatively late. Okay. Okay. You know. You know, because of that, it didn't just in a capital constrained environment, we have to see, you know, what are we gonna take forward, right? I looked at this thing the other day, the enterprise value of cell and gene therapy companies. First of all, it's very humbling. If you look at non-commercial cell and gene therapy companies, there are only a handful of us that have positive enterprise values. Almost all of the CAR T cells have negative enterprise values. For us to continue forward, we have to get one of two things to happen, right? Someone has to pay for this, right? We have to convince investors that it's worth paying for our asset. And, you know, I think that means they have to both value our drug more than they do today, and they probably have to value the class a little bit more. Or, you know, we'll partner with someone, hopefully, who, you know, does. But those are the things that we're looking at right now around those drugs. And if neither of those things turn out to be true, we won't be able to keep going forward. I mean, I just, you know, we have to be realistic about the way the world is. Yeah. I mean, that kind of. We will not compromise the diabetes asset. Yeah. To be very clear. Okay. That was gonna be my next question is sort of how do you maximize ROI while balancing the cash investment today, for the assets. The, you know, it's, I do think, and again, there's no guarantees of success in our industry. We're particularly in a complicated space of, you know, gene-edited stem cell-derived therapies. But, you know, this is a generational type opportunity in terms of size. It will work, right? It will work. We don't know if it'll be safe. We don't know if we can scale it and if it's a good business, but it will work. If it does turn out that we, you know, are able to do that, it will be a very, very high ROI investment, for people. We will not let that be capital starve. Okay. Answer those questions. Okay. I see we've got 10 minutes on the clock. Do we have? There was no second. Oh, okay. Okay. I've got one more question if you're okay, Steve. Since you've been, you're an industry veteran, I'd be interested to hear your thoughts on the CBR appointments. You know, we talked about the necessity of having long-term follow-up to fully understand what these assets are. I mean, that's something Prasad has also said. You know, any shifts in the way that you're thinking about drug development, given the current appointments, obviously the development timelines span beyond, you know, different FDAs, presumably. Any thoughts from your seat? I think there's zero change what we're trying to do. I do think, you know, again, first of all, I don't know these people personally. I know of them. We've been around some of the same hoops over time. You know, I'm optimistic that when smart people get around a room who understand data, that, you know, over time, good things happen. I'll give you two examples. I don't think this has any impact on what we're trying to do in type 1 diabetes. It should work in, you know, pretty much everybody. And if that turns out to be true and we're able to be safe, and we're able to manufacture it, I don't see why any, it, it will change. I think if we were still going after what we were doing in type, in, in oncology, right? We had a, a third line, you know, allogeneic CAR T program where the hope was that we had something that was more readily accessible for patients, than an autologous CAR T cell. I think that would be a tough bar. I would think that, you know, if we were still going forward with that, it may have been something that required a lot more data than what we are, we're currently, than what we were thinking about. We're not, so it doesn't impact us. You know, I don't, I don't yet see a sea change in anything that we're contemplating. It doesn't mean that other parts of the industry won't have, I bet you there are places where it becomes, you know, a more straightforward path and where it becomes more challenging. We're just, we'll have to figure that out. Okay. Okay. I wanna be respectful of everyone's time, so I guess we should probably leave it there, Steve. Thanks for joining the conference and the great conversation. Thank you, Alex. Thank you everybody for your time and attention. Thank you.