Great. Thanks everyone for being here. My name is Yanan Zhu. I'm one of the biotech analysts here at Wells Fargo. I'm very delighted to be joined by Steve Harr, CEO of Sana Biotech. Thank you so much, Steve, for being here. Oh, thanks for having us. Great. I was just wondering if you could kick us off with a company overview before we dive into questions. Sure. As everybody knows, we'll be making forward-looking statements, so please check out our disclosures and risk factors in our most recent 10-Q. We also posted a presentation and an 8-K today. The company was founded really around two technologies, and they're both about to really move into humans and we'll hopefully have a really good idea around how they're working. One is, our goal has always been to really figure out how to scale engineered cells and be able to go after highly prevalent diseases with either cell therapy or gene therapy, depending on how you think about it. The first platform we started the company around was the goal of hiding cells from immune detection. The goal of that, and the most promising program we have there, is a potentially one-time treatment for people with type 1 diabetes. That's making progress and should be something that we can file with the FDA this year and hopefully start a phase I study. The technology, just to take a step back, type 1 diabetes, about 10 million people in the world have it. If you are 22 years old and you have the choice between breast cancer, HIV, and type 1 diabetes, it turns out that type 1 diabetes will have the shortest expected lifespan. That's with the best therapy, and you can imagine the day-to-day stress of that disease. You may know people with it. It's very difficult to manage. People have challenges with both hypoglycemia or too low blood sugars, and then all the complications long-term of hyperglycemia, or too high. We know a few things about it. First of all, the disease is one where the immune system attacks the beta cell, the pancreatic beta cells, the only cell in our body that makes insulin. About 100 years ago, it became clear that you could give exogenous insulin, and it went from being an instant death sentence to something people can live for decades with, right? Over the last 25 years, some real progress has been made to understand how we might move towards a more definitive curative therapy, though. About 25 years ago, a group of people, starting in Canada, started transplanting pancreatic islets. Think of an islet as beta cells plus their support structure. They would transplant these islets from a recently deceased cadaver, and people do very well. They can live for decades off insulin with normal blood sugars. It's not a scalable source. It's a very variable source. It just turns out there aren't that many people for whom lifelong immunosuppression, because this is, again, it's a transplant of cells. It's better than lifelong insulin. Thousands of people have gotten this. Over the last few years, several groups have shown that you can take pluripotent stem cells and mature them into pancreatic islets and transplant them. That's probably a more scalable source. It looks like it's more consistent. But people still remain on lifelong immunosuppression. We've now shown in a single patient, which is all we ever wanted to treat, in the cadaveric islet space, that we can gene modify islets and transplant them into a person with type 1 diabetes. The patient has been able to see these cells function in grafts and persist for now, the last publication was 14 months. It's been published twice in The New England Journal of Medicine, actually. It's really the first example I think that any of us are aware of, where we have transplanted cells with no immunosuppression. Now all the component parts are there for hopefully a curative therapy, and that's this drug SC451. It's a gene-modified stem cell-derived pancreatic islet. The goal is a one-time intramuscular injection with hopefully a functional cure for the person with this disease. By that we mean normal blood glucoses with no insulin and no immunosuppression, hopefully for decades or life. We'll dose the first patient shortly. Shortly being not defined, but it's coming up on us. The second platform we have is an ability for cell-specific delivery in vivo. The first place we're applying that technology are in vivo CAR T cells. I have been at this for a while, and we made some very specific choices. We have seen some people get a little bit ahead of us in line, where they have shown some very promising and exciting data in the field. We have worked very hard to ensure cell-specific delivery. We worked very hard to try to minimize the risk of off-target safety events and on-target safety events. Again, that is a program, the lead asset called SG293, which is a CD19 CAR T, so I am sure we will get into a bit more. Our goal has been to get into and start human testing very soon. For clarity, we have been doing this outside the United States, and it is an IIT, an investigator-initiated trial, that we are trying to do in China. Things have definitely gotten more complicated in China over the course of the last, let us just say three to six months. It is probably going to take us a bit longer than we hoped to get that done. I do not know exactly what that means. It might be one or two quarters slower to get the human data than we hoped. It will get there, and we have spent a lot of time, again, on this medicine, really trying to create a very clear scientific pathway. We have shown in non-human primates the ability to do cell-specific delivery, meaning we are only getting into T cells, and we see the therapeutic effect we want to. So we are optimistic that this will also have some very exciting data, but you never know till you get into humans and you see what biology gives you. Great. Thanks for the very helpful background. Let us talk about SC451. Yeah. This one, you hope to make an IND filing and start phase I/II as early as this year. I was wondering, in terms of the remaining items before the IND filing, such as GLP tox studies and tech transfer to contract manufacturer, where are you on those activities? What are some of the other remaining items that you are still working on? Yeah. So basically, whenever you are kind of putting together these, beginning of a clinical study, three main work streams, right? You have a clinical work stream of trial protocol, and with this case, because of the novelty and complexity of delivery, that has been a lot of work to ensure we have that. I think we are quite comfortable and confident with where we are on that. The second is your, I call it the non-clinical package, which includes the GLP toxicology study, but includes a lot of other things. That is pretty much complete. All the important studies have been done, and I think we can be pretty confident on preliminary results at least that things are all good. We have to get all the final study reports done. Then we are finishing up the tech transfer into the GMP manufacturing facility. That is still ongoing. We are actually hopefully pretty near completion on that as well. But that is the long pole in the tent, if you will, to filing the IND and starting this study. Got it. Are there other important items or not so much? Not so much. I think we're in pretty good shape otherwise. I mean, not to say otherwise in a negative way, but I think the other things are, or the boxes have been checked more or less. Got it. What about testing and release assays? Is that something that you need to align with FDA for the IND filing, or is that for later? Well, we've benefited from a pretty open dialogue with a number of different regulatory agencies. These are complicated medicines. You have a gene-modified master cell bank of pluripotent stem cells. There's a lot of concern, reasonably, about introducing off-target edits, about the editing process actually creating stress on the cells, and also just as these cells grow and divide. Remember, you're starting essentially with one cell, and every patient is, call it 1 billion, 1.5 billion cells. That means to treat 1,000 people, you need over 1 trillion cells. You're going through many, many, many divisions. What we need to make sure of is that the product is what we think it is. The first part of that is that the genome is safe, and that you haven't done things like select for cells that have mutations that have been associated with cancer, that type of thing. That's something that we spent a lot of time on. We've been very transparent around that we had some challenges with early, but feel very good about where we are today. The second is you want to make sure you have the product you think you do, which is just all the different cells that go into making an islet are there and that you have control of the drug and it's potent and it looks to be safe. So, there's a lot of testing that gets done on these cells and I think we have a really good idea of what we need to do. We're doing it. Okay. Got it. But those are not gating on IND filing or? Well, I mean, when you think through tech transfer of anything into a GMP facility, you have a whole host of things that get transferred in. One is just like actually the supply chain. It has to come through their system. The second is you then have to make the program, the product itself. And the third is you have to transfer in all of the release assays. So somebody has to do them usually kind of on-site or real time. And so those things are still ongoing. I mean, to say that there's nothing left on assay validation would be premature. Okay. But I don't think you should be worried about it, but it's not done. Okay. Got it. Very helpful. Looking forward, once the trial started, I was just curious, what is the earliest clinical signal that you might see? And then what is the soonest that investors might hear about it? Like how long do you want to accumulate data before you talk about them? I think we're going to be transplanting in gene-modified cells with no immunosuppression. What you know based upon all transplant literature is that those cells should be rejected in a matter of days. If we see these cells continue to function and persist, let's just call it with no immune attack on them, let's say they go out like a month or something. Just like what happened when the single patient in this Uppsala investigator-sponsored trial where we put in these gene-modified cadaveric islets. I think that was viewed by most as being very material. I think we would probably agree with that assessment, and if you do see that, the probability of running any other immunologic issue is quite low. That period of time is super important. I always kind of think of it as, are you able to get engraftment and function, then it'll persist? If yes, then the second thing becomes, are you able to get people off insulin? Right. Do we have the right dose? Are the cells high quality? Do we have more or less normal blood sugars or the ability for a patient to have a hemoglobin A1C of less than seven with no insulin? Then the third will be, is it replicable? Right. Those to me are the three major questions. Do we evade the immune detection? Is this actually a drug? Right. Is it really replicable? If we're like six out of six, you're going to feel this is most people, right? If we're three out of six, you're probably going to say, "I'd like to see a little bit more." Right? I mean, we'll have to see how it all plays out. But I think you'll learn a lot next year. A lot. Got it. Okay. Got it. I know we'll have data next year, but you probably couldn't be more granular in terms of when we might have the initial proof of concept. I think that these are super complex medicines and very complicated studies. Trying to get precise about when you have data, I will sacrifice accuracy for precision. Accuracy is what I gave you because I think it's just we have to see kind of how this all plays out. Okay. Got it. I guess the next question is, how much data, how many patients do you need to see before you talk to FDA and start thinking about next steps? Well, you have to already start thinking about next steps, to be clear. Okay. Right. I always say that there are kind of three major questions for this drug, which is, one, does it work? Second is, if it works, can you really scale it, right, at a reasonable cost of goods? Again, to put that into context, with 10 million people growing at 5% a year, if we treat 100,000 people a year, all you do is take the global growth rate from 5% to 4%, right? There's a big scale opportunity and challenge ahead of us. The third then is, if you can scale it, how do you figure out a commercial model for a highly prevalent curative therapy? We are already working on the scale question for what I'd call registration/early commercial launch process, because it's always 6- 12 months to transfer something into a GMP facility. I think that if things go really well, this can move pretty quickly into a registration study. I do not know exactly how many patients it is going to take. If it is working in everybody, it is going to take fewer patients than if it is working in some, right? But I do not think this is dozens and dozens of patients. This is likely something less than that to really get our arms around it. Okay, great. Yeah. That is- There is no placebo, right? There is no placebo effect here, right? You know what will happen. People who do not take insulin with type 1 diabetes will not live, right? People who do not take immunosuppression with a transplant, we will see those rejected. So either this, it works and it is very clear, or we have some more work to do. Got it. I think Dr. Carlsson will present at EASD next month. Could there be any new information there such as longer follow-up than 14 months? There might be. I don't view that longer follow-up is that important anymore, right? Just to be clear, I've said that since 28 days, though. It's likely going to continue to be around. There isn't really any immunologic issue that's likely to rear its head. We're not transplanting these cadaveric islets next time, and you're not going to learn a lot about the durability of the cells we transplant. Our cells could be worse, our cells could be better. My expectation is that these cells will last for at least for a while longer. I don't know how long before they exhaust. They came from a 60-year-old person who died, who had a hemoglobin A1C of 6.2%, and it's not like they were probably already getting kind of petered out, and we'll just have to see kind of how it all goes. Okay. Actually, I'm not sure what he's presenting yet. I mean, I think that's still a month away and to be determined. Great. I think maybe this is definitely an exciting time for type 1 diabetes and for the company's very differentiated platform. Definitely looking forward to the initiation of the trial and data next year. Well, yeah, me too. I joke around sometimes, it feels like sometimes we're waiting for Godot, and Godot's finally shown up. Hopefully we'll have an opportunity to understand in people. Sometimes I give them this analogy that it's like others in the field have made an electric car, right, the people who've done the islet transplants before. It turns out it wasn't that useful because it had to be plugged in. Right? We showed with that New England Journal of Medicine paper that we could make a lithium battery, essentially, right? Now we need to put together the whole thing and see, can we really get this to go? Everything suggests that this should work. Right? I've been around long enough to know that biology, and particularly immunology, have a distinct way of humbling us. I'll be excited to see the data, and hopefully, we'll be delivering something that's really helpful for people who deserve a better and new treatment. Okay. Yep. Well said. Let's rotate to another area that you pioneered, years ago, that is in vivo CAR T. This area has seen a lot of activities over the last couple of years. As we watch the number of acquisitions and partnerships formations across the space, I was wondering, what do you think are the pharma companies going after, and how are your program positioned in this landscape? Yeah. I think they're going after things they think work. Whether or not they end up working we'll have to see. Again, just to go to the biology, not everything will play out like you hope it does. What we did that's different. At the very beginning of this program, we made three really kind of intentional choices. We'll end up seeing if these were really good choices to make, or if we made things complicated. One is we believe cell specificity's super important. That includes, not going into the liver and not going into antigen-presenting cells. I think if you look at our data to date, I'm pretty confident we have a best-in-class therapy around that. The alternative hypothesis is that it isn't that important. You just need to get enough into the target cell, which is the T cell. If that turns out to be right, we will overcomplicate things. The second is because you have, let's call it, you and I probably have 100 billion B- cells, and if we have cancer, we probably have 100 billion more cancer cells, and you're only maybe making 100 million CAR T cells. We've always believed you need to integrate the DNA into the target cell so you can get that multi-logarithmic expansion and growth to kill, because you have way more target cells to kill than you have CAR T cells. That may be right. I think that early human and animal data suggest it's likely to be right. But if that's not right, mRNAs are a lot easier to do, and that's people don't like the idea of the integrating signal because it does have some at least theoretical risks. The third thing we did is we've dissociated entry from activation. Right? What I mean by that is most of these companies are using something like CD3 to enter the cell. What you've seen to date is a new category of side effects come across in this field. It's a peri-infusion toxicity. It's being dealt with with high-dose steroids. We're optimistic that we will have something better around that. We don't know that for sure, because we don't know exactly, and we have to put it in people and see. We use a different molecule to enter the cell, which allows us to titrate inactivation of the cell, not overly stimulate the T cell, and hopefully have a safer therapy and maybe a longer-lasting therapy, because you won't exhaust the cells with the CD3 activation. If you're using your CD3 as your activation and entry portal, you may end up over-stimulating these cells. Those are the three things we've done differently. They may turn out to be really valuable in the clinic, and they may not, and you don't really know until you get into people. It definitely has slowed us down to do it this way. As you said, we kind of pioneered this, have been at this for a while, and companies have jumped ahead of us in line. I hope that they turn out to be really important for patients because they were intentional choices we made. Can I follow up on the point of not targeting through CD3? Is that the CD8 targeting method, or is it separate? Yeah. We're using CD8 to enter the cell. Those are your effector. Those are your killer cells. Now, the flip side of that, again, everything has a cost, is we're not entering CD4 helper cells or regulatory cells. It doesn't look like that's going to be important based on what we know and the information we have, but I think that's still plausible, that you wish you had a bit more activity by having made CD4 cells. But the benefit of it is it's a much more specific delivery. We're able to, again, titrate in the activation of these cells with a little CD3 co-display on the VLP, on the virus-like particle, rather than using it as. If you're using it as your portal of entry, you can't turn down your activation without lowering your potency. Because you are using CD3. Again, CD3 is a very potent activator. Everybody who makes an ex vivo CAR T cell in some way binds to CD3 to kind of get these cells going. There is an old drug called OKT3, which is a CD3 activator that was used. I remember it from when I was in medical school and residency as being a very difficult medicine to administer because of, again, this cytokine release syndrome or peri-infusion toxicity that took place. Okay. Any comment on CD7? Some companies are using CD7. Does that stimulate the T cell or could it achieve entry without activation, do you think? I would like to see some more CD7 data before you could make a true determination on that. Right. Got it. Yeah. That is super helpful to understand the differentiation and potential. Sure. I think you alluded to this earlier. I think you were thinking about data this year. That's apparently you're referring to activities in China that you're working on. But perhaps one or two quarters, given some recent development. Any thoughts on, maybe let me ask you this question. Once this study enters the clinic, how quickly do you think. This is a cancer study, right? Maybe two questions here. Does this mean that you are more focused on cancer, than autoimmune disease? Two, for a cancer study, how quickly can you get a sense of- Yeah. how well the drug works? I would really like to think that we're able to develop this medicine in both the oncology setting, and the autoimmune diseases. That being said, I think what you've seen even over the last few weeks from others in the field is that the safety bar is higher, in the autoimmune space. We feel it's appropriate to start in the oncology setting and really understand the potency and safety and efficacy of this program. If it works as we hope it does, which includes both potency and a really tolerable side effect profile, we'd like to move rapidly into autoimmune diseases. But we have to see what the clinical profile looks like. How quickly can you see, is that the question? Right. Yeah. It's a little hard to know. One of the reasons these VLPs, these virus-like particles, are complicated is that they're all derivations in some way of lentivirus, which is in some way a derivation of HIV. Actually, that's a species-restricted virus. So it doesn't infect most non-human primates. So you're using some surrogate vector into a normal monkey. Because they don't have cancer, right? It's not a disease model. The mice model are simple. Like that's easy. But I think you really need to get into humans to understand dose. Because you're using a surrogate in a non-human primate. So you could have something where we've seen a company that's dosed too high, patients almost died. We've seen another company that started out, and it took them a few doses to get to the therapeutic dose. We've seen one that it seemed like from the outset, the first, they were kind of in the right ballpark with their dose. Which one we end up being, I don't think we know. So it could happen very quickly. I doubt we're too high. I think we've learned enough that you want to kind of come in carefully. But we may be too low, we may be just right, and that will determine how long it takes us, because you have to get through the dose finding portion. It's a novel therapy. It's a first-in-class type of technology, and sometimes you get fortunate and you're at the right dose, and more frequently, you got to go through some of the dose finding. So we'll see. I do think it's pretty quick once you get here to know does it work. To really understand is that if you take just a big 10,000 ft or 50,000 ft view, B-cell depleters is a very competitive space. You've got pills, antibodies, ADCs, T cell engagers. You've got CAR T cells. You've got in vivo CAR T cells. You've got different technologies in the in vivo space. How we fit into that competitive landscape will take more patients than a handful of efficacy. But that early efficacy can be very helpful in understanding, does this technology really work like we hope it does? Okay. Got it. I think you alluded to this. I hope we can get some of your insights. This is regarding the autoimmune indication, Novartis and BMS announcing a study pause due to severe immune or inflammatory reactions after their rapidly manufactured CAR Ts were administered to autoimmune disease patients. You have a lot of experience with CAR T. Can you talk about what you think the cause there might be? Does it have anything to do with this rapid manufacturing process and maybe related to in vivo CAR T? Could there be any read-through given that their T cells are very quick turnaround, whereas in vivo, I think is no turnaround at all. Well, take a step back. The side effect that they've described is a well-known side effect of CAR T cells. It's this immune-mediated hemolytic syndrome. It was probably missed in the very early days of the CAR T field, and it's probably underrepresented on labels based on what is reality, because it smells a lot like cytokine release syndrome. It happens just a little bit later, and it actually has a different treatment. First thing I'd say is anybody who thinks that this is not their problem who is in the CAR T space is fooling themselves. This is all of our problem. It's just like you're going to have cytokine release syndrome, you're going to have neurologic toxicity. You're going to have this stuff over time. It's been seen across different targets, across different manufacturing platforms, across different diseases. Those things are true. Number two, is there something about this patient population or something about the medicines that these companies are making that specifically are a heightened risk? I don't think we know enough. I think it would be way too premature to. They haven't told us what happened. You do know that this is often a very treatable issue. It might just be that there's some physician education that needs to take place. You need to treat really early in the course of this hemolytic syndrome. Again, if they were treated for a cytokine release syndrome, that's not going to have done the trick. I look forward to learning more. I like to think that you won't have this issue in at least our technology, where again, we're hopefully activating the T cell less. I don't think we could confidently say that without a lot of experience. It's a rare side effect, but if you're treating hundreds of people, you may start to see a little bit. I don't think you can say you don't have the issue after five, 10, 15 people. It's going to take us more time. Stay tuned. I do think this is something that. It's a great reminder that these are amazingly wonderful medicines, and they give people potentially a very rapid cure to some very dismal diseases. They are very potent medicines, and we have to be careful and mindful as we're treating people with them. Got it. Got it. Really appreciate the perspective. In the remaining time, I was wondering, can you talk about your cash runway, and how do you think about capitalizing the company? Yeah. I see our clock's at zero, so we're better than that. I'll try to be brief. We have about $160 million. We've said it will last us to the middle of next year. We've got a lot of things coming up with a number of data points. We generally said managing through 2026 and until we get to data, we're going to be pretty tactical about things and just make sure that we maintain some buffer so that if things don't go as we hope they do, we've got a little bit of time. If we're fortunate enough to have some good data across either one or both of these programs, we think we'll be in a strong position to rebuild the balance sheet and to capitalize the company more fully. We certainly would like to have multiple years of cash on our balance sheet at some point in the not too distant future. That may be through business development, that may be through raising equity, it may be through something else, we'll have to see. Great. Great. Thank you. As you said, we have come to the end of the session. I want to thank you again, Steve, for a very helpful and enlightening session. No, thank you, and thanks everybody for your time and attention. Great. Thanks everyone.