10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2023

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO

Commission File Number 001-39941

Sana Biotechnology, Inc.

(Exact name of Registrant as specified in its Charter)

188 East Blaine Street, Suite 400Seattle, Washington 98102

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (206) 701-7914

Securities registered pursuant to Section 12(b) of the Act:

Title of each class TradingSymbol(s) Name of each exchange on which registered

Common Stock, $0.0001 par value per share SANA The Nasdaq Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes☒ No ☐

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐No☒

Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes☒ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes☒ No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☒

Non-accelerated filer ☐ Smaller reporting company ☐

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the Registrant included in the filing reflect the correction of an error to previously issued financial statements. 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the Registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). 

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant was approximately $0.6 billion, based on the closing price of the Registrant’s common stock on the Nasdaq Global Select Market on June 30, 2023, the last business day of the Registrant’s most recently completed second fiscal quarter. Shares of the Registrant’s common stock held by each officer and director and stockholders that the Registrant has concluded are affiliates of the Registrant have been excluded in that such persons may be deemed affiliates of the Registrant. This determination of affiliate status is not a determination for other purposes.

As of February 22, 2024, the Registrant had 220,447,557 shares of common stock, $0.0001 par value per share, outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant’s definitive Proxy Statement relating to its 2024 Annual Meeting of Stockholders (Proxy Statement) are incorporated by reference into Part III of this Annual Report on Form 10-K (Annual Report) where indicated. The Proxy Statement will be filed with the U.S. Securities and Exchange Commission within 120 days after the end of the fiscal year to which this Annual Report relates.

Table of Contents

Page

PART I

Item 1. Business 5

Item 1A. Risk Factors 72

Item 1B. Unresolved Staff Comments 144

Item 1C. Cybersecurity 144

Item 2. Properties 145

Item 3. Legal Proceedings 145

Item 4. Mine Safety Disclosures 145

PART II

Item 6. [Reserved] 147

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 162

Item 8. Financial Statements and Supplementary Data 164

Item 9A. Controls and Procedures 188

Item 9B. Other Information 188

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 189

PART III

Item 10. Directors, Executive Officers and Corporate Governance 190

Item 11. Executive Compensation 190

Item 14. Principal Accounting Fees and Services 190

PART IV

Item 15. Exhibits and Financial Statement Schedules 191

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K (Annual Report) contains forward-looking statements that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this Annual Report could be deemed forward-looking statements, including those statements highlighted below. In some cases, you can identify these statements by forward-looking words such as “aim,” “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “should,” “would,” or “will,” the negative of these terms, and other comparable terminology. These forward-looking statements, which are subject to risks, include, but are not limited to, statements about:

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our expectations regarding the potential market size and size of the potential patient populations for our product candidates and any future product candidates, if approved for commercial use;

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our clinical and regulatory development plans;

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our expectations with regard to our preclinical studies, clinical trials, and research and development programs, including the impact, timing, and availability of data from such studies and trials;

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the timing of commencement and advancement of future preclinical studies, clinical trials, and research and development programs;

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our ability to acquire, discover, and develop product candidates and timely advance them into and through clinical data readouts and successful completion of clinical trials;

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our expectations regarding the potential safety, efficacy, or clinical utility of our product candidates;

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our intentions with respect to and our ability to establish collaborations or partnerships;

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the timing or likelihood of regulatory filings and approvals for our product candidates;

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our commercialization, marketing, and manufacturing expectations, including with respect to the buildout of our manufacturing facility and capabilities and the timing thereof;

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impact of future regulatory, judicial, and legislative changes or developments in the United States and foreign countries;

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our intentions with respect to the commercialization of our product candidates;

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the pricing and reimbursement of our product candidates, if approved;

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the potential effects of public health crises on our preclinical and clinical programs and business;

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our expectations regarding the impact of global events and macroeconomic conditions on our business;

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the implementation of our business model and strategic plans for our business and product candidates, including additional indications that we may pursue;

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our ability to effectively manage our growth, including our ability to retain and recruit personnel, and maintain our culture;

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the scope of protection we are able to establish and maintain for intellectual property rights covering our product candidates, including the projected terms of patent protection;

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estimates of our expenses, future revenue, capital requirements, needs for additional financing, and ability to obtain additional capital;

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our expected use of proceeds from our initial public offering and our existing cash, cash equivalents, and marketable securities;

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the performance of our third-party suppliers and manufacturers;

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our future financial performance;

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our expectations regarding the duration for which we will be an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (JOBS Act); and

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developments and projections relating to our competitors and our industry, including competing products.

We have based these forward-looking statements largely on our current expectations, estimates, forecasts, and projections about future events, our business, the industry in which we operate, and financial trends that we believe may affect our financial condition, results of operations, business strategy, and financial needs. In light of the significant uncertainties in these forward-looking statements, you should not rely upon forward-looking statements as predictions of future events. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Annual Report, we cannot guarantee that the future results, levels of activity, performance, or events and circumstances reflected in the forward-looking statements will be achieved or occur in a timely manner or at all. You should refer to the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. Other sections of this Annual Report may include additional factors that could harm our business and financial performance. New risk factors may emerge from time to time, and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in, or implied by, any forward-looking statements. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Annual Report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and you should not unduly rely upon these statements.

RISK FACTOR SUMMARY

Investing in our securities involves a high degree of risk. Below is a summary of material factors that make an investment in our securities speculative or risky. Importantly, this summary does not address all of the risks that we face. Additional discussion of the risks summarized in this Risk Factor Summary, as well as other risks that we face, can be found under the heading “Risk Factors” in Part I of this Annual Report.

Our business is subject to a number of risks of which you should be aware before making a decision to invest in our common stock. These risks include, among others, the following:

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Our ex vivo and in vivo cell engineering platforms are based on novel technologies that are unproven and may not result in approvable or marketable products. This uncertainty exposes us to unforeseen risks, makes it difficult for us to predict the time and cost that will be required for the development and potential regulatory approval of our product candidates, and increases the risk that we may ultimately not be successful in our efforts to use and expand our technology platforms to build a pipeline of product candidates.

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If we are unable to successfully identify, develop, and commercialize any product candidates, or experience significant delays in doing so, our business, financial condition, and results of operations will be materially adversely affected.

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We will require additional funding to finance our operations. If we are unable to raise capital when needed, or on acceptable terms, we could be forced to delay, reduce, or eliminate our product development programs or commercialization efforts.

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We may not realize the benefits of technologies that we have acquired or in-licensed or will acquire or in-license in the future. We may also fail to enter into new strategic relationships or may not realize the benefits of any strategic relationships that we have entered into. The occurrence of any of the foregoing could materially adversely affect our business, financial condition, commercialization prospects, and results of operations.

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Our ability to develop our cell engineering platforms and product candidates and our future growth depend on retaining our key personnel and recruiting additional qualified personnel.

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We may encounter difficulties in managing our growth if and as we expand our operations, including our development and regulatory capabilities, which could disrupt our operations and otherwise harm our business.

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The use of human stem cells exposes us to a number of risks in the development of our human stem cell-derived products, including inability to obtain suitable donor material from eligible and qualified human donors, restrictions on the use of human stem cells, as well as ethical, legal, and social implications of research on the use of stem cells, any of which could prevent us from completing the development of or commercializing and gaining acceptance for our products derived from human stem cells.

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We must successfully progress our product candidates through extensive preclinical studies and clinical trials in order to obtain regulatory approval to market and sell such product candidates. Even if we obtain positive results in preclinical studies of a product candidate, these results may not be predictive of the results of future preclinical studies or clinical trials.

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Preclinical testing of our product candidates may be delayed or otherwise unsuccessful, which would harm our ability to commence and successfully complete clinical trials of, and ultimately commercialize, such product candidates.

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Clinical drug development is a lengthy and expensive process with uncertain timelines and outcomes. If clinical trials of any of our product candidates are prolonged or delayed, or need to be terminated, we may be unable to obtain required regulatory approvals and commercialize such product candidates on a timely basis or at all.

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Clinical trials may fail to demonstrate that our product candidates, including any future product candidates, or technologies used in or used to develop such product candidates, meet the FDA's or a comparable foreign regulatory authority's requirements with respect to safety, purity, and potency, or efficacy, which would prevent, delay, or limit the scope of regulatory approval and commercialization of such product candidates.

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Our product candidates may cause serious adverse, undesirable, or unacceptable side effects or have other properties that may delay or prevent marketing approval. If a product candidate receives regulatory approval, and such side effects are identified following such approval, the commercial profile of any approved label may be limited, or we may be subject to other significant negative consequences following such approval.

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The manufacture of our product candidates is complex. We or our contract development and manufacturing organizations (CDMOs) may encounter difficulties in production, which could delay or entirely halt our or their ability to supply our product candidates for clinical trials or, if approved, for commercial sale.

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We are exposed to a number of risks related to the supply chain for the materials required to manufacture our product candidates.

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We rely, and expect to continue to rely, on third parties to perform certain activities, including research and preclinical studies, manufacture of our product candidates and materials used in the manufacturing of our product candidates, and the conduct of various aspects of our clinical trials. Any failure of such third parties to perform their obligations to us, including in accordance with our timelines or applicable regulatory requirements, could materially harm our business.

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Our success depends on our ability to protect our intellectual property rights and proprietary technologies, and we may not be able to protect our intellectual property rights throughout the world.

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We depend on intellectual property licensed from third parties. If we breach our obligations under the applicable license agreements or if any of these agreements is terminated, we may be required to pay damages, lose our rights to such intellectual property and technology, or both, which would harm our business.

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Our internal computer systems, or those used by third parties involved in our operations, such as research institution collaborators, clinical research organizations (CROs), CDMOs, and other service providers, contractors, or consultants, may fail or suffer security breaches or incidents.

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The development and commercialization of biopharmaceutical products is subject to extensive regulation, and the regulatory approval processes of the United States Food and Drug Administration (FDA) and comparable foreign regulatory authorities are lengthy, time-consuming, and inherently unpredictable. If we are unable to obtain regulatory approval for our product candidates on a timely basis, or at all, our business will be substantially harmed.

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We have incurred significant losses since our inception, and we expect to incur losses for the foreseeable future. We have no products approved for commercial sale and may never achieve or maintain profitability.

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Our success payment and contingent consideration obligations in our license and acquisition agreements may result in dilution to our stockholders, drain our cash resources, or require us to incur debt to satisfy the payment obligations.

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We operate in highly competitive and rapidly changing industries, which may result in others discovering, developing, or commercializing competing products before or more successfully than we do.

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Our limited operating history may make it difficult to evaluate our prospects and likelihood of success.

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We or the third parties upon whom we depend may be adversely affected by natural disasters, public health epidemics, telecommunications or electrical failures, geo-political actions, including war and terrorism, political and economic instability, and other events beyond our control, and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster.

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Market and economic conditions may negatively impact our business, financial condition, and share price.

PART I

Item 1. Business.

Overview

We were founded on the belief that engineered cells will be one of the most important transformations in medicine over the next several decades. The burden of diseases that can be addressed at their root cause through engineered cells is significant. We view engineered cells as having the potential to be as therapeutically disruptive as biologic drugs to clinical practice. Key to making this vision a reality will be finding consistent and scalable means of manufacturing cell-based medicines, and we have invested significantly in our hypoimmune (HIP) platform technology, which we refer to as our HIP platform, with the twin goals of using allogeneic cells that evade immune detection in patients and that we can manufacture at scale. We are developing cell engineering programs to revolutionize treatment across a broad array of therapeutic areas with unmet treatment needs, including oncology, diabetes, B-cell-mediated autoimmune, and central nervous system (CNS) disorders, among others.

We currently have four clinical trials that are ongoing, or that we expect to commence in the near-term, evaluating our product candidates, or product candidates developed using our technologies, across seven diseases in multiple therapeutic areas, including B-cell malignancies, B-cell-mediated autoimmune disease, and type 1 diabetes (T1D), as described below.

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ARDENT is an ongoing Phase 1 clinical trial evaluating SC291, our hypoimmune-modified CD19 targeted allogeneic chimeric antigen receptor (CAR) T program, in B-cell malignancies, including non-Hodgkin’s lymphoma (NHL) and chronic lymphoblastic leukemia (CLL);

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GLEAM is a Phase 1 clinical trial evaluating SC291 in patients with lupus nephritis (LN), extrarenal lupus (ERL), and antineutrophil cytoplasmic antibody (ANCA)-associated vasculitis;

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VIVID is a Phase 1 clinical trial evaluating SC262, our hypoimmune-modified CD22 CAR T program, in patients with relapsed and/or refractory B-cell malignancies who have received prior CD19 CAR T therapy; and

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Investigator-sponsored first-in-human study (IST) evaluating UP421, an allogeneic, primary islet cell therapy engineered with our HIP technology, in patients with type 1 diabetes mellitus.

In January 2024, we disclosed initial interim clinical data from the ARDENT trial. As of January 5, 2024, the cut-off date for our early interim analysis, six patients had been dosed with SC291 and four patients were evaluable (defined as patients dosed with SC291 who had at least one disease assessment), of whom three were dosed with 60M CAR T cells (Dose Level 1) and the other was dosed with 120M CAR T cells (Dose Level 2). With respect to the four evaluable patients at these two dose levels, we observed no dose limiting toxicities, no SC291-related serious adverse events, and no incidences of graft versus host disease (GvHD). We also observed no cytokine release syndrome (CRS) or immune effector cell-associated neurotoxicity syndrome (ICANS) of any grade or any infections of Grade 3 or higher. Additionally, we observed at least a partial response in three of the patients, including ongoing complete responses in one patient from Dose Level 1 after three months and the patient from Dose Level 2 after two months.

The SC291 drug product contains CAR T cells that are fully edited hypoimmune cells, which we describe as HIP-edited CAR-T cells, along with partially edited cells, which we describe as non-HIP CAR T cells. In vitro testing showed evidence that blood and immune cells from each of the four evaluable patients had mounted an immune response to the non-HIP CAR T cells but not to the HIP-edited CAR T cells. Specifically, HIP-edited CAR T cells from the drug product were not rejected by the innate immune response mediated by the patient’s natural killer (NK) cells, nor did the patients have T cell or antibody responses that recognized these cells. In contrast, we observed immune responses against the non-HIP CAR T cells in the drug product.

Importantly, this evidence suggests that the patients had an intact immune system capable of recognizing allogeneic cells and that the HIP CAR T cells were able to evade these responses. These results were consistent across all four evaluable patients and provide early support for the idea that the immune evasion profile of our HIP gene edits in multiple pre-clinical models may translate into human subjects. We believe this observation supports further dose escalation and dose expansion in the ARDENT trial and broader application of our HIP technology in allogeneic cell therapies in other indications. We are continuing to enroll and dose patients in the ARDENT trial and expect to share additional data in 2024.

We seek to overcome several existing limitations of gene and cell therapy through our ex vivo and in vivo cell engineering platforms, both of which may facilitate the development of therapies that can transform the lives of patients by repairing cells in the body when possible and replacing them when needed. For ex vivo therapies, when diseased cells are damaged or missing entirely and an effective therapy needs to replace the entire cell, a successful therapeutic requires large-scale manufacturing of cells that engraft, function, and persist in the body. Of these, we view cell persistence as the greatest current limitation to dramatically expanding the impact of this class of therapeutics, and in particular, overcoming the barrier of immune rejection of transplanted allogeneic cells. We believe that product candidates developed with our ex vivo cell engineering platform, which uses hypoimmune-modified allogeneic cells that can “hide” from the patient’s immune system, can address this fundamental limitation and unlock a wave of disruptive therapeutics. For in vivo therapies that aim to repair and control genes in the body, a successful product candidate requires both gene modification and in vivo delivery of the therapeutic payload. Of these, we view effective in vivo delivery as the greatest current limitation to dramatically expanding the impact of this class of therapeutics. To this end, our initial focus is on cell-specific delivery of genetic payloads.

Based upon early clinical as well as extensive preclinical data from our HIP platform, we announced in October 2023 our decision to increase our focus on our ex vivo cell therapy product candidates. We expect to focus a meaningful portion of our research and development resources and activities for at least the next several years on advancing HIP-modified ex vivo manufactured cells as therapeutics.

Our people are the most important strength of the company. We have assembled a diverse group of experienced company builders, scientists, manufacturing scientists, engineers, and operators to execute our business plan.

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Experienced Company Builders. We have numerous individuals with vast experience in building disruptive biotech companies. Our Founder and Chief Executive Officer, Dr. Steve Harr, was previously CFO of Juno Therapeutics, helping to build the company and its CAR T cell therapy platform until its acquisition. He is a physician-scientist with experience in basic research, clinical medicine, finance, company building, and operations. Our Chairman of the Board and co-founder, Mr. Hans Bishop, is an experienced company builder and operator with success across a number of companies.

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Leading Scientists. We believe that in order to successfully develop engineered cells as medicines, significant investments in infrastructure and cross-functional capabilities need to be coupled with deep scientific expertise in the cell types of interest within each program. Our leadership team includes multiple world-class scientists, including researchers who have made seminal discoveries in gene delivery, immunology, CAR T cells, stem cell biology, and gene editing. We expect to continue to bring in senior world-class scientists to lead our efforts in each therapeutic area we intend to pursue. Additionally, our research teams have significant experience in various areas of biology. We have surrounded this team of discovery scientists with drug developers experienced in advancing product candidates through the development process with expertise in areas such as pharmacology, toxicology, regulatory, clinical development, and clinical operations.

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Experienced Manufacturing Scientists, Engineers, and Operators. Since our founding, we have proactively assembled manufacturing sciences and operations expertise on our board, on our executive team, and across the company.

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Board and Investors with Shared Long-Term Vision. Our board of directors is composed of renowned company builders, scientists, drug developers, and investors who share our long-term vision of advancing engineered cells as medicines to change the lives of patients. Our board of directors is a resource that has enabled our strategy of consolidating technologies, assets, and people to expand the potential impact of our long-term vision.

Our capabilities enable us to take a comprehensive approach to the most important and difficult aspects of engineering cells. We are primarily pursuing ex vivo cell engineering and can leverage the synergistic proficiencies required to succeed in both approaches. We believe we can capitalize on the shared expertise and infrastructure between the platforms to maximize the potential success and the reach of each of our potentially transformative therapies. We have built deep internal capabilities across a wide range of areas focused on solving the most critical limitations in engineering cells including:

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Stem Cell and Disease Biology. Developing our platforms into therapies for patients requires a deep understanding of both cell and disease biology. Furthermore, we are investing significantly in our people and the technologies that enable the differentiation of pluripotent stem cells (PSC) into mature cells that can be used as therapeutics.

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Immunology. The immune system can be harnessed to treat multiple diseases, and it can also limit the therapeutic effect of many cell- and gene-based therapies. Understanding and harnessing the immune system can have a broad impact across our ex vivo and in vivo cell engineering portfolio. We are investing in our people and technologies to harness the immune system, particularly T cells, for the treatment of cancer and other diseases. Additionally, our hypoimmune technology has the potential to “hide” cells from the immune system, unlocking the potential of allogeneic ex vivo therapies for the treatment of numerous diseases.

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Genome Modification. The ability to knock-out, knock-in, modify, disrupt, and control expression of genes is fundamental to the success of our platforms. We believe our capabilities across multiple modalities will allow us to use the appropriate system for the biologic problem of interest.

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Gene Delivery. We believe our delivery technologies have broad potential, with both near-term and long-term applications across a number of indications. We are investing in technologies that allow payload delivery to specific cell types and increase the diversity of payloads.

Our Cell Engineering Platforms

The advent of recombinant DNA technology in the 1970s ushered in a new era of therapeutics, enabling the synthetic manufacture of human protein therapies at scale for the first time. A critical inflection point occurred when key technological advancements eventually enabled the broad development of protein drugs, including monoclonal antibodies with suitable therapeutic properties. These advancements, combined with progress in understanding disease biology, allowed biologics to become the second largest therapeutic class. We believe engineered cells are at a similar inflection point, with key recent technological advancements providing the potential for the broad applicability of this therapeutic class.

Engineering cells ex vivo requires the ability to engineer and manufacture cells at scale and then deliver them to the patient so that they engraft, function appropriately, and have the necessary persistence in the body. Our goal for ex vivo cell engineering is to replace or add any cell in the body such that those cells engraft, function, and persist over time, and to manufacture those cells cost-effectively at scale. Our ex vivo cell engineering platform uses our hypoimmune technology to create cells that can “hide” from the patient’s immune system to enable persistence of allogeneic cells. We are primarily focused on making therapies using PSCs with our hypoimmune genetic modifications as the starting material, which we then differentiate into a specific cell type, such as a pancreatic islet cell, before treating the patient. Additionally, there are cell types for which effective differentiation protocols from a stem cell have not yet been developed, such as T cells. For such cell types, instead of starting from a PSC, we can use a fully differentiated allogeneic cell, sourced from a donor, as the starting material to which we then apply our hypoimmune genetic modifications. Our goal is to manufacture genetically modified cells that are capable of both replacing the missing cell and evading the patient’s immune system. We are now applying our ex vivo cell engineering technologies to make cell products for the treatment of multiple diseases. We anticipate sharing data in 2024 from multiple clinical trials exploring these therapeutics in various diseases.

Our Portfolio Strategy

We believe the potential applications of our platforms are vast. To prioritize programs for our ex vivo and in vivo engineering pipeline, we have used the following strategies:

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minimize biology risk where there is platform risk, or in other words, prioritize opportunities where success with our platform should lead to success in addressing the underlying disease;

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prioritize program investments in diseases where the strengths of our ex vivo and in vivo cell engineering platforms can address the key limitations of existing therapeutic approaches;

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focus on conditions of high unmet need, including the most grievous diseases; and

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prioritize efforts where success in one area begets success in others.

Our Pipeline

We are developing a broad pipeline of clinical product candidates focused on creating transformative ex vivo therapies across a range of therapeutic areas. We are in the early stages of development across a broad pipeline of product candidates, which are summarized below:

Each of our initial programs provides the potential for meaningful standalone value while also supporting our potential ability to further exploit our platforms in a manner that leads to the development of broadly applicable medicines.

Allogeneic T Cell Platform

SC291

We are first applying our hypoimmune technology to donor derived T cells to be used as allogeneic cell therapies for hematologic malignancies.

These programs are designed to address a major limitation of existing allogeneic CAR T cell therapies: the need to evade host versus graft responses (HvGR) that occur when a patient’s immune system kills the transplanted T cells, limiting the potential benefit of the therapy. The rapid killing of the transplanted cell may be a major contributor to the short-lived responses seen in patients treated with allogeneic CAR Ts. One approach to avoid HvGR has been to effectively eliminate a patient’s immune system for a short period using chemotherapy, which puts the patient at risk for severe infections. Further, the patient’s suppressed immune system inevitably recovers and eliminates the CAR T cells, limiting the effectiveness of the therapy. Our hypoimmune technology is designed to enable cells to “hide” from the patient’s immune system, giving our allogeneic CAR T cell program the potential to create medicines that persist longer in patients and avoid the risks associated with higher doses of chemotherapy.

ARDENT

Our most advanced hypoimmune product candidate is SC291, a CD19 allogeneic CAR T program that we are evaluating as a potential treatment for NHL and CLL in the ARDENT trial. Results of our early interim analysis of clinical safety and other clinical responses as well as immune responses to SC291 are discussed above under “Overview” and below under “Allogeneic T Cell Platform — SC291.”

GLEAM

In November 2023, the FDA cleared our Investigational New Drug application (IND) to evaluate SC291 in patients with LN, ERL, and ANCA-associated vasculitis, which we refer to as our GLEAM trial. B-cell depleting therapies, such as anti CD20 antibodies (e.g., rituximab), have shown clinical benefit in the treatment of multiple autoimmune disorders that involve production of autoimmune antibodies, including LN, ERL, ANCA-associated vasculitis and many others. The rituximab trials in systemic lupus erythematosus (SLE) afforded the key insight that the depth of B-cell depletion was associated with improved patient responses. While these antibodies are adept at depleting B-cells in circulation for many patients, they are unable to penetrate deeply into the germinal centers of the lymph node and tissues, where the pathogenic B-cells continue to survive and drive disease. CD19 CAR T cells are known to cause deep B-cell depletion in CAR T recipients. Georg Schett and his research group in Erlangen, Germany tested the treatment of refractory SLE patients with autologous CD19 CAR T cells and were successful in inducing long-lasting drug-free remissions for these patients in the study. In our ongoing ARDENT trial, we have observed the pharmacodynamic effect of peripheral blood B-cell depletion, which refers to diminishing B-cell counts in the peripheral blood, associated with SC291 treatment in patients. While pharmacodynamic effects seen in oncology patients may not translate to patients with autoimmune disease, we believe these data increase the probability that SC291 treatment confers similar B-cell depletion, the putative mechanism of benefit, to patients with B-cell-mediated autoimmune disorder.

SC291 also provides the benefit of being available “off the shelf,” avoiding the complex management of patients around the apheresis procedure for cell harvest and between cell harvest and infusion required for treatment with autologous CAR T products while also providing the potential for increased manufacturing scalability. We expect to share data from the GLEAM trial in 2024.

Initial clinical success with SC291 would support the expansion of our allogeneic CAR T efforts with additional product candidates targeting other patient populations. Our allogeneic T cell platform is designed to enable the substitution of CAR constructs in a modular fashion. For the near-term, we are prioritizing clinically-validated targets as well as CAR constructs, such as our CD19 CAR, that have shown promising safety and efficacy profiles in hematologic malignancies in the autologous context.

SC262

We are developing SC262, our hypoimmune-modified CD22-directed allogeneic CAR T program, initially as a potential treatment for patients with relapsed and/or refractory B-cell malignancies who have received prior CD19-directed CAR T therapy in NHL, CLL, and acute lymphocytic leukemia (ALL). In January 2024, the FDA cleared our IND to evaluate SC262 in this patient population. We refer to the Phase I clinical study as our VIVID trial. The CD22 CAR construct that we use in SC262, which we licensed from the National Institutes of Health, has already been evaluated in multiple academic clinical trials of autologous CAR T cell therapies, data from which have shown complete responses (CR) in a substantial number of patients that have relapsed following treatment with a CD19-directed CAR T therapy. Data from a Phase 1 trial (n=38) of NHL patients conducted at Stanford University, where 97% of patients were either refractory and/or relapsed after prior CD19 CAR T therapy, demonstrate a CR rate of 53% and an overall response rate (ORR) of 68%. Seventy-five percent of the CRs lasted 12 months or longer.

Modular Pipeline for Allogeneic CAR T Therapy

Allogeneic CAR T development candidates are manufactured from T cells purified from donor PBMCs. T cells undergo genome modification to disrupt MHC class I and class II expression (which inactivates adaptive immune responses), disrupt TCR expression (which minimizes graft vs. host disease) and overexpress CD47 (which enables cells to evade the innate immune system, including macrophages and NK cells). Development candidates principally differ in the CAR expressed by the cells. Expansion during manufacturing allows production of hundreds of patient doses per donor (based on current scale and accounting for hold back necessary for testing and dose variability).

SC255

We are developing SC255, a B-cell maturation antigen (BCMA)-directed allogeneic CAR T, for the treatment of multiple myeloma (MM). The BCMA CAR construct that we use in SC255, which we licensed from IASO Biotherapeutics and Innovent Biologics is part of equecabtagene autoleucel (Fucaso; CT103A). China’s National Medical Products Administration has approved the new drug application for this drug in adult patients with relapsed or refractory multiple myeloma who previously received 3 or more lines of therapy, including a proteasome inhibitor (PI) and an immunomodulatory drug (IMiD). Data from such trials presented at the American Society of Hematology Annual Meeting in December 2023 showed an overall response rate of 96%, a minimal residual disease (MRD) negativity rate of 94%, and a complete response/stringent complete response (CR/sCR) rate of 78% in 103 patients. At one year, 81% of patients continue to be MRD negative. The SC255 program has completed a battery of pre-clinical tests and is currently gated based on resource availability.

In the future, additional candidates may be nominated to address hematological malignancies, solid tumors, and autoimmune disease.

SC379

We are developing SC379, our PSC-derived glial progenitor cell (GPC) product candidate, as a therapy to deliver to patients with certain central nervous system disorders healthy allogeneic GPCs, which are the precursors to both astroglia and myelin-producing oligodendrocytes. SC379 has the potential to treat patients with myelin- and glial-based disorders, which represent a broad group of debilitating neurological disorders, such as multiple sclerosis (MS) and a number of neurodegenerative disorders, none of which have effective treatment alternatives. We intend to develop SC379 for the treatment of secondary progressive MS, Pelizaeus-Merzbacher disease (PMD), other myelin-based disorders, Huntington’s disease, and other astrocytic diseases. Our goal is to begin clinical testing for SC379 as early as 2025.

PSC-derived Pancreatic Islet Cells

SC451

SC451 is our PSC-derived hypoimmune pancreatic islet product candidate for the treatment of diabetes, with an initial focus on type 1 diabetes mellitus (T1DM). Greater than 8 million patients worldwide have T1DM. T1DM is a disease in which a patient’s immune system attacks and kills pancreatic beta cells, leading to complete loss of insulin production in affected individuals. Patients typically need to take multiple insulin injections every day for life. Although the introduction of insulin has had a profoundly positive impact on patients, people with T1DM have approximately 15 years shorter life expectancies than people without diabetes and are consistently at risk for complications such as coma, stroke, myocardial infarction, kidney failure, and blindness from poorly controlled blood glucose. We and our collaborators have shown that we can develop high quality stem cell-derived islet cells that, when transplanted in animal models, normalize blood glucose and cure diabetes. We have also shown that our hypoimmune cells induce no systemic immune response, even in non-human primates (NHPs) with a pre-existing immune response to non-hypoimmune cells, and that our allogeneic NHP hypoimmune islet cells survive for the duration of our NHP studies, the longest of which is about forty weeks. To demonstrate applicability in the context of T1DM, we have developed a proprietary mouse model in-house, with humanized immune cells from a T1DM patient, and showed that hypoimmune modifications enabled T1DM patient-derived stem cell islet cells to evade both the autoimmune and allogeneic response. As a result, we believe our stem cell-derived hypoimmune pancreatic islet cells have the potential to create a disruptive treatment for T1DM, offering patients life-long normal blood glucose without immunosuppression. We are working on process development and IND-enabling studies.

UP421

In November 2023, the Swedish Medical Products Agency authorized Uppsala University Hospital’s clinical trial application (CTA) for an investigator-sponsored, first-in-human study evaluating UP421, an allogeneic, primary islet cell therapy engineered with our hypoimmune technology, in patients with T1DM (the IST). Human pancreatic islet transplantation from allogeneic donors into T1DM patients has been shown to reduce or even eliminate long-term exogenous insulin dependence, albeit when administered with immunosuppression which leads to toxicity. Under the IST, a group of experienced pancreatic islet transplantation experts will transplant allogeneic primary islet cells that have been genetically modified with the hypoimmune modifications into T1DM patients without immunosuppression. We believe that a stem cell-derived islet product candidate such as SC451 would likely maximize the benefit to patients, with superior manufacturing scalability and consistency when compared to primary islet cells. However, we are optimistic that immunology insights gained from the IST, particularly whether the hypoimmune modifications lead to long-term survival and evasion of either allogeneic or autoimmune killing of the cells, may provide direct insights and learnings applicable to SC451, potentially accelerating development of this product candidate. We expect data from the IST to be shared in 2024.

Our ex vivo Cell Engineering Platform

Overview

Ex vivo cell engineering aims to treat human disease by engrafting new cells to replace damaged, diseased, or missing cells in patients. Historically there have been four key challenges to ex vivo cell engineering:

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engraftment of the right cell in the right environment;

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appropriate function of the cells, necessitating an understanding of and ability to produce the desired cell phenotype;

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persistence of the cells in the host, particularly by overcoming immune rejection; and

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manufacturing the desired cell in the quantities required.

Our ex vivo cell engineering platform seeks to address these four challenges and is focused on engineering hypoimmune cells that engraft, function, and persist in patients by evading immune rejection. These cells are derived from sources that are scalable, and we believe that continued progress with this platform has the potential to create broad access for patients.

Our Approach to Building our ex vivo Cell Engineering Platform

We have approached the development of our ex vivo cellengineering platform by investing in solutions to address the key challenges outlined above:

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Stem cell and disease biology. We believe that it is critical to have expertise in the developmental biology of stem cell differentiation and a deep understanding of the desired cell biology of stem cell differentiation in order to generate cells that function appropriately, as well as a deep understanding of the desired cell phenotype. The latter requires expertise in normal and disease biology. Furthermore, clinical understanding of disease pathology and transplant medicine is required to determine how to engraft the right cell in the right environment. Each of our programs is led by a prominent clinician-scientist with deep expertise in both cell therapy and disease biology.

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Immunology and genome modification. We believe that a deep understanding of the immunological response to engineered cells is essential to unlocking the potential of ex vivo therapies. We have licensed technologies from Harvard University, the University of California San Francisco, Washington University, and others to enable this effort. In addition, in order to create successful hypoimmune cells, we are investing in building out our gene editing, genome modification, and gene insertion capabilities.

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Manufacturing. We are investing proactively in process development, including process optimization and scale up, analytical development, CMC regulatory, supply chain, quality, and other manufacturing sciences in order to develop processes that can enable scalable manufacturing of cell therapies and broad patient access. We have entered into agreements with contract development and manufacturing organizations (CDMOs) and other partners for access to facilities and reagents in our supply chain necessary to manufacture our product candidates. We have built a pilot manufacturing plant in South San Francisco, California and entered into a long-term lease agreement for a manufacturing facility in Bothell, Washington, where we intend to build our own clinical trial and commercial current Good Manufacturing Practice (cGMP) manufacturing capabilities. We entered into a lease agreement under which we have obtained access to manufacturing capabilities within University of Rochester Medical Center’s cell-based manufacturing facility to support manufacturing for early-stage clinical trials. We are also investing to obtain and ensure access to high quality donor-derived T cells and GMP-grade PSC lines for our programs. We will continue to invest in our manufacturing capabilities to ensure our pipeline needs are met.

Our Approach to Building our ex vivo Cell Engineering Portfolio

We have prioritized cell types for our programs when:

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high unmet need can be addressed by cell replacement;

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existing proof of concept in humans and/or animal models demonstrates that cell transplantation should have a clinical benefit;

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evidence exists that the cell type can be successfully differentiated from PSC and that such stem cell-derived cells can function appropriately in vivo;

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there has been the ability to hire or partner with world experts in the field to ensure our programs are rooted in a deep understanding of the underlying cell and disease biology; and

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evading immune system rejection via the hypoimmune technology is either not required initially (such as for glial progenitor cells (GPCs)) or is the critical missing element to developing a cell therapy (such as islet cells).

Based on this prioritization, we are focused on three cell types: T cells, islet cells, and GPCs.

Historical context of ex vivo therapy

Blood transfusions have been a standard treatment for many patients for over 100 years. The first successful kidney transplant occurred in 1954, followed by the first successful heart transplant in 1967, demonstrating the transformative clinical potential of replacing damaged or missing cells in the body. Surgical enhancements have improved the success of engraftment, but lack of organ access, complex surgical procedures, and immune rejection of the donated organs have limited the impact of these procedures.

Progress in immunosuppressive regimens, such as the development of cyclosporine, has improved organ survival rates. However, substantial side effects and the fact that many patients are ineligible or non-compliant have reduced their impact.

Ultimately, the field has looked for a scalable source of therapeutic cells that can be accessed broadly at a manageable cost, as well as cells that can evade immune rejection without immunosuppression. The advent of stem cell technology and subsequent improvements in methods to generate functional differentiated cells at scale have the potential to address the shortage of donor tissues and organs. In addition, over the past decade, a deeper understanding of the immunology of HvGR, coupled with novel techniques to manipulate the immunological profile of cells via gene editing, have raised the prospect that ex vivo engineered cells can benefit patients without the requirement for significant immunosuppression.

Sources of allogeneic cells

There are three main potential sources of allogeneic cells, or cells that do not originate from the patient, and therefore have the potential to be manufactured and supplied at scale. These are embryonic stem cells (ESCs), induced pluripotent stem cells (iPSCs), and donor-derived cells. Our portfolio currently reflects a mix of sources, with the ambition of transitioning primarily to iPSCs over time.

Embryonic Stem Cells

The recognition that every cell in the body originates from a zygote, or fertilized egg, led to the research and ultimate discovery of human ESCs, with the derivation of the first human ESC line in 1998. ESCs are PSCs which have the potential to differentiate into any cell type and are derived from the inner cell mass of a blastocyst or pre-implantation stage embryo. They are typically cultured in vitro and grown through cycles of cell division, known as passages, until a line of cells is established that can proliferate without differentiating, and retain their pluripotency while remaining well characterized, including being free of potentially deleterious genetic mutations. Because PSCs can divide indefinitely without exhaustion, an ESC line can be used to generate cell banks, consisting of large numbers of well-characterized vials of cells, that can be frozen and stored for future use.

Induced Pluripotent Stem Cells

The discovery that mature, differentiated cells can be reprogrammed to be the equivalent of an ESC and capable of generating any cell type in the body has led to the research and ultimate development of human iPSCs, providing an alternative option as a source 3of stem cells for use in ex vivo engineered cells. A key breakthrough in 2006 demonstrated that mature cells could be reprogrammed via the expression of a small number of genes to result in pluripotent cells. These iPSCs have similar potential to ESCs to be used as an indefinitely renewable cell bank for manufacturing of cell-based therapies.

Donor-Derived Allogeneic Cells

Another source of cells, which we use in our T cell programs, comes from mature donor-derived allogeneic cells. Although these T cells are neither pluripotent nor from an infinitely renewable source, they can be obtained as mature cells from human donors at scale. The use of donor-derived cells for our T cell programs should allow us to rapidly advance the programs towards the clinic with the implementation of our hypoimmune technology.

Approach to Sources of Allogeneic Cells

The use of iPSCs as the starting material for our programs offers regulatory and cultural advantages over ESCs, and scale and product consistency advantages over donor-derived allogeneic cells. Our portfolio currently reflects a mix of sources, which is primarily driven by historical factors as well as current better characterization of genomic stability through differentiation. Our ambition is to transition primarily to iPSCs over time.

Crucial aspects of developing allogeneic cells from any source include a thorough characterization of the cells, a comprehensive understanding of the global regulatory environment, and an ability to maintain cells under the required conditions, such as cGMP, at various stages of the manufacturing processes. We believe our early investment in building capabilities in the science and manufacturing of these cells will increase our likelihood of success. This investment is anticipated to yield sources of cells suitable for the global clinical development and commercialization of ex vivo engineered cells for a broad patient population, in line with our vision to democratize access.

Background on Immunological Barriers to ex vivo Therapies and Current Limitations

Starting with studies in renal transplantation in the early 1900s, it became clear that there were immunological factors preventing successful transplantation. Initially, transplant rejection was suspected to be mediated by an antibody response, but in the 1950s, it was discovered that cell-mediated immune pathways also play a critical role.

Further studies established that T cells play a key role in the host immune response to transplant. T cells belong to the “adaptive” immune system, recognizing and eliminating “non-self” cells via recognition of differences in cell-surface proteins encoded by the major histocompatibility (MHC) locus. There are two types of MHC molecules: MHC class I, expressed on the surface of almost all nucleated cells, and MHC class II, expressed constitutively on professional antigen presenting cells (APC), including macrophages and dendritic cells. Expression of MHC class II is also induced in many additional cells in the context of inflammation. MHC class I molecules typically display peptides from degraded intracellular proteins on the cell surface. Cells display peptides from normal “self” proteins on MHC class I, which typically will not activate an immune response due to a process called tolerance, where the body recognizes these peptides as “self.” However, if a cell displays a peptide from a foreign or mutated protein on MHC class I, for example, as a result of a protein mutation, it may result in the activation of a cytotoxic T cell response specific to the peptide-MHC complex via the T cell receptor (TCR) on the T cell surface. The activated T cell then eliminates the cell. MHC class II molecules typically display peptides derived from phagocytosis of extracellular proteins on the surface of APCs. These peptide-MHC complexes interact with TCRs on helper T cells, such as CD4+ T cells, resulting in a downstream cellular and humoral immune response. The humoral immune response leads to antibody production against foreign proteins. In allogeneic transplants, the cellular and humoral processes can recognize proteins from the donor as “foreign,” resulting in an immune response to the transplant, including potential elimination of the transplanted cells. In the allogeneic setting, MHC proteins can be highly immunogenic due to their inherent polymorphism, increasing the risk of the recognition of transplants as “foreign.” This immunogenicity underlies the basis for MHC typing and matching to assess and reduce the risk of organ transplant rejection.

Many groups have attempted to engineer cells that can evade the adaptive immune system, typically by downregulating or eliminating expression of MHC molecules on the surface of cells. Although this approach can reduce the adaptive immune response to donor cells, the human immune system has evolved so that parts of the innate immune system will recognize cells missing MHC molecules and eliminate them. For example, NK cells express receptors known as inhibitory killer-cell immunoglobulin-like receptors (inhibitory KIRs). KIRs recognize self MHC class I molecules on the surface of cells and provide inhibitory signals to the NK cells to prevent their activation. Cells missing MHC class I molecules are correspondingly eliminated by NK cells because of the lack of inhibitory KIR signaling and a resulting cytolytic activation. Known as the “missing self-hypothesis,” this important redundancy in immunology enables the elimination of virally infected or transformed cells that have downregulated MHC class I, but it has complicated the development of allogeneic cells as broadly applicable therapeutics. Our hypoimmune technology seeks to engineer cells to avoid immune rejection by addressing both the adaptive and innate immune response.

There are three key strategies that have been used to date to overcome immune rejection, with limited success:

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Immune Suppression. Cyclosporine and other molecules that suppress T cell responses are commonly used, and many patients have been helped by these approaches in areas such as an organ transplantation. However, immune suppression often leads to significant systemic side effects, including a decreased ability to resist infections, increased susceptibility to cancer, and a wide variety of organ toxicities. Furthermore, organ transplant recipients typically require immunosuppression on a lifelong basis, and any disruption in this immunosuppression can rapidly trigger transplant rejection.

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Matching HLA Type. A second approach to overcoming immune rejection is to find a donor with a matched human leukocyte antigen (HLA) type. In humans, HLA is a synonym for MHC. This approach addresses the root of the mechanism that the immune system uses to identify “non-self” cells and has achieved some success. Finding a matched donor, however, can be difficult and is usually limited to close relatives who are willing and able to donate. Although some have advocated for creating large banks of cells that match a wide variety of HLA types, even with fully matched HLA class I and class II donors and recipients, there is a need for at least some immune suppression due to the presence of numerous minor antigen mismatches.

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Autologous Approaches. More recently, researchers have pursued autologous approaches, where a patient’s own cells are modified and introduced back into the patient as a graft. These cells may avoid immune rejection as they would be recognized as “self.” Autologous approaches have demonstrated effectiveness in certain diseases, such as autologous CAR T cells for hematological malignancies, but these approaches are limited in their adoption due to manufacturing cost and complexity. Furthermore, autologous approaches are generally limited to cells that exist in the patient in suspension, such as blood cells.

Our Solution – Hypoimmune Technology

To address the challenge of immune rejection with allogeneic cell transplantation, we are developing our hypoimmune technology, which uses genome modification to introduce permanent changes to the cells. We are applying the hypoimmune technology to PSCs, which can then be differentiated into multiple cell types, and to donor-derived allogeneic T cells, with the goal of making potent CAR T cells at scale and transplanting allogeneic cells into patients without the need for systemic and prolonged immune suppression. We believe that enabling this capability has the potential to enable ex vivo engineered cells to become an important therapeutic modality alongside small molecules, protein biologics, and in vivo engineered cells.

Some of our scientific founders and their collaborators have worked on creating hypoimmune cells for well over a decade. A key insight that informed their work is the phenomenon of fetomaternal tolerance during pregnancy. The fetus, despite having half its genetic material from the father, is not rejected by the mother’s immune system. However, after birth, few if any children would qualify as a matched donor for a cell or organ transplant for their mother. These scientists categorized the differences of the maternal-fetal border and systematically tested them to understand which, if any, of these were most important to immune evasion. They have tested these changes both in vitro and in vivo in animal models.

Designing Hypoimmune Cells

Our goal is to create a universal cell capable of evading immune detection, regardless of cell type or transplant location. Our current clinical hypoimmune technology, which is being used in our SC291, SC262, and SC255 product candidates, combines three genome modifications to “hide” these cells from the host immune system:

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disruption of MHC class I expression;

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disruption of MHC class II expression; and

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overexpression of CD47, a protein that enables cells to evade the innate immune system, including macrophages and NK cells.

Once these modifications have been applied to a cell, we refer to that cell as a hypoimmune cell.

Preclinical Development of Hypoimmune Cells

We and our licensors have carried out a series of experiments in various model systems of increasing immunological complexity. These included (i) transplanting undifferentiated mouse hypoimmune iPSCs into MHC mismatched allogeneic mice, (ii) transplanting mouse hypoimmune iPSC-derived differentiated cells, such as endothelial cells, into MHC mismatched allogeneic mice, (iii) transplanting human hypoimmune iPSCs into MHC mismatched humanized allogeneic mice, (iv) transplanting NHP hypoimmune iPSCs into MHC mismatched allogeneic NHPs, (v) transplanting NHP hypoimmune iPSC-derived differentiated cells, such as cardiomyocytes, into MHC mismatched allogeneic NHPs, and (vi) transplanting NHP hypoimmune primary cells, such as islets, into MHC mismatched diabetic and non-diabetic NHPs.

Each mouse experiment evaluated:

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whether hypoimmune cells can be successfully transplanted into the recipient without the need for immunosuppression and without eliciting an immune response; and

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whether differentiated cells derived from our hypoimmune cells were successfully engrafted in the recipient without needing immunosuppression and without eliciting an immune response.

We have also investigated the NHP immune response to human iPSCs, NHP iPSCs, NHP iPSC-derived differentiated cells, and NHP primary islets. Importantly, we have shown that hypoimmune primary islets can mediate insulin independence in a fully immunocompetent diabetic NHP without immunosuppression. This confirms that hypoimmune modifications confer immune evasion without compromising islet function in this setting. We are encouraged by the data from these investigations, given the similarity of the NHP immune system to the human immune system and that NHP models represent the strictest test outside of evaluating these cells in humans. We are evaluating both iPSCs as well as differentiated cells transplanted into the microenvironments we intend to target in humans. Based on the results of these NHP studies, we expect to test these hypoimmune cells in humans as a next step.

Mouse iPSC-derived hypoimmune cells transplanted into MHC mismatched allogeneic mouse

Mouse hypoimmune iPSCs transplanted into an MHC mismatched allogeneic mouse were protected from the mouse immune system, and no evidence was seen of either adaptive or innate immune system activation. The control arm transplanted unmodified mouse iPSCs into MHC mismatched allogeneic mice, and, as expected, these unmodified mouse iPSCs were rapidly rejected by the recipient mouse immune system with a robust adaptive immune response. In another experiment, the genes that code for MHC class I and MHC class II expression were disrupted. These modifications protected the cells from the recipient mouse’s adaptive immune system, but NK cells rapidly killed the transplanted cells. These data highlight the importance of all three genome modifications (MHC class I, MHC class II, and CD47 overexpression) in protecting cells from the immune system following an allogeneic transplant.

Next, to ensure that hypoimmune genome modifications protected differentiated cells and that these modifications did not impact the ability of iPSCs to differentiate into various cell types, commonly referred to as pluripotency, the scientists tested whether the hypoimmune iPSCs cells could be differentiated into three different cell types, function in vivo, and evade the host immune system. The three cell types were cardiomyocytes, endothelial cells, and smooth muscle cells. The hypoimmune iPSCs successfully differentiated into all three cell types, the cells functioned in the mouse, and the transplanted cells survived for the full standard observation period with no evidence of immune system activation despite having received no immune suppression. Differentiated cells derived from unmodified iPSC cells led to immune activation in the host mice, which did not survive. These data provide initial proof of concept that iPSCs can be genetically modified and differentiated into target cells that can engraft, function, and evade the recipient’s immune system following transplantation.

Human iPSC-derived hypoimmune cells transplanted into MHC mismatched allogeneic humanized mouse

Having demonstrated the ability of mouse iPSC-derived hypoimmune cells to satisfy each of three testing criteria, the experiments were advanced to evaluate human hypoimmune cells by using a “humanized” mouse system, generated by grafting a functioning human immune system in place of the mouse immune system. We also evaluated the ability to successfully engineer human hypoimmune cells from human iPSCs and whether differentiated cells derived from human hypoimmune cells retain biological function.

Creating Hypoimmune Therapeutic Cells from Human iPSCs

Our current clinical hypoimmune technology combines the following three gene modifications to “hide” cells from the host immune system: disruption of MHC class I and class II expression (which inactivates adaptive immune responses), and overexpression of CD47 (which “hides” cells from the innate immune system, including macrophages and NK) cells. PSCs from healthy donors are used as the starting material and are then genetically modified with the hypoimmune modifications. These edited cells are then differentiated into cell types of therapeutic interest, which could potentially be administered to the patient as “off the shelf” therapies.

First, the three genome modifications described above were replicated in human iPSCs to engineer a human hypoimmune cell line with properties comparable to the mouse hypoimmune cells in vitro. Next, unmodified human iPSCs were transplanted into MHC mismatched humanized mice. It was observed that these unmodified human iPSCs were rapidly rejected. Human hypoimmune cells were then transplanted into MHC mismatched humanized mice. It was observed that the human hypoimmune cells survived the full length of the experiment and failed to elicit any type of immune response. From this data we concluded that in humanized mice, human hypoimmune cells can evade the immune system. Pluripotency of human hypoimmune cells was confirmed by differentiation into two different cell types, endothelial cells and cardiomyocytes, which exhibited the characteristics of normal endothelial cells and cardiomyocytes. Finally, to test whether the differentiated cell types derived from human hypoimmune cells could continue to evade the immune system, the differentiated cells were transplanted into humanized mice, and the transplanted cells survived for the full standard observation period. In contrast, differentiated cells derived from unmodified human iPSC cells did not survive after being transplanted, as anticipated. It was also observed that the hypoimmune endothelial cells formed primitive vasculature with active blood flow, and the hypoimmune cardiomyocyte cells matured into functional-looking heart cells.

Absence of T and B-Cell Activation Following Transplantation of Hypoimmune Human iPSCs into Mismatched Humanized Mice

Left panels: T cell activation was measured by EliSpot counts for interferon-gamma production. Immune cells from mice that received wild type (wt) iPSC grafts show a brisk interferon response when tested against allogeneic wt iPSC grafts. By contrast, immune cells from mice that received hypoimmune cells (MHC class I/II disruption, CD47 tg) cells show only minimal interferon production when exposed to allogeneic hypoimmune cells, comparable to background frequency in non-immunized mice. Right panels: B-cell activation was measured by antibody binding to each cell type, shown as mean fluorescence intensity (MFI). Wild type cells exhibit significant antibody binding when incubated with serum from mice that received wt cells. By contrast, hypoimmune cells show only background levels of binding when treated with serum from mice that received hypoimmune cells. Adapted from Deuse et al, Nature Biotechnology 2019.

CD47 is Required to Protect Hypoimmune Cells from Killing by Human NK Cells

Human iPSCs were differentiated into endothelial cells (hiECs) and plated as a monolayer in a multielectrode system. After exposure to NK cells, monolayer viability was measured by electrical impedance, indicated here as normalized cell index. As expected, wt cells were not killed by NK cells. By contrast, cells lacking MHC class I and II (MHC class I/II disruption), but not expressing CD47, were rapidly killed. Addition of CD47 tg prevented killing by NK cells. A blocking antibody to CD47 abolished protection from NK cells, affirming the importance of CD47 overexpression in protection from innate immune cell killing. From Deuse et al, Nature Biotechnology 2019.

Survival of Hypoimmune Human iPSC Grafts in MHC-Mismatched Humanized Mice

Wild type (wt) and hypoimmune (MHC class I/II disruption and CD47 tg) iPSCs were engineered to express firefly luciferase before transplantation. Emission of light was used as an index of graft cell viability. Sequential light emission scans from the same representative animal receiving wt cells show progressive loss of graft viability, indicating graft rejection, confirmed quantitatively in the line tracings below. By contrast, mice receiving hypoimmune cells show graft expansion over the course of the experiment, indicating immune evasion. From Deuse et al, Nature Biotechnology 2019.

NHP hypoimmune cells transplanted into NHPs

To evaluate immune evasion properties of the hypoimmune cells, we have tested the immune response to and survival of hypoimmune iPSCs from NHPs by transplantation into an allogeneic NHP recipient without immunosuppression.

Design for Allogeneic Study Involving Wild Type (Unmodified) and Hypoimmune NHP iPSC Delivery to NHPs

The study involved a randomized group of eight NHPs distributed into two cohorts of four NHPs each. The first cohort received an initial intramuscular injection of unmodified NHP iPSCs in one leg and a second injection of NHP hypoimmune cells at six weeks in the other leg (i.e., a crossover design). The second cohort received an initial injection of NHP hypoimmune cells in one leg, which allowed assessment of immune evasion in a naïve recipient. In order to model certain aspects of autoimmune disease, this cohort also received a second injection of unmodified NHP iPSCs in the other leg, which enabled assessment of the impact of injecting hypoimmune cells into an NHP with a pre-existing immune response to unmodified cells. No immunosuppression was administered to any of the NHPs in the study.

Allogeneic Hypoimmune iPSCs Survive in vivo in NHPs with an Intact Immune System

Upper panel: Unmodified wild type (wt) NHP iPSCs (Group 1, top row) or hypoimmune NHP iPSCs (Group 2, bottom row) were introduced via intramuscular injection into allogeneic NHPs. Unmodified NHP iPSCs are undetectable in recipient NHPs by week 3 while hypoimmune NHP iPSCs introduced into naïve NHPs were viable and detectable for 16 weeks post injection. At 6 weeks following the initial injection, NHPs were injected with the crossover cell type (Group 1 with hypoimmune NHP iPSCs and Group 2 with wt unmodified iPSCs). In these crossover experiments, hypoimmune NHP iPSCs survived even when the NHP had been exposed to unmodified iPSCs. Unmodified iPSCs injected into NHPs previously injected with hypoimmune iPSCs were rapidly killed with no observable impact on the hypoimmune NHP iPSCs that continued to remain viable. Data shown from single NHP belonging to each group; images are representative for four NHPs receiving hypoimmune iPSCs and four NHPs receiving wt iPSCs.

Lower panel: iPSC survival in vivo is followed over time using bioluminescence imaging (BLI).

Absence of T Cell, B-Cell, or NK Cell Responses Following the First Delivery and Crossover of Hypoimmune NHP iPSCs into NHPs

Upper panel: Immune cells from NHPs receiving hypoimmune iPSCs showed no response when exposed to hypoimmune iPSCs in vitro (Row 1) in contrast to wt iPSCs (Row 2). Lower panel: Neither unmodified nor hypoimmune iPSCs were susceptible to killing by NK cells, indicating protection from the “missing self” signal. Data above are collected from four NHPs in each experimental arm.

NHP hypoimmune iPSCs grafted into NHPs elicited no detectable systemic immune responses, including no T cell activation and no antibody formation. Innate immune responses mediated by macrophages and NK cells were also undetectable. The transplanted hypoimmune cells were alive and detectable in the four allogeneic recipients for the duration of the study, which was 16 weeks for two of the NHPs and 8 weeks for the other two NHPs. To our knowledge, this is the first instance of prolonged graft survival in an allogeneic transplant setting without immunosuppression in NHPs. By contrast, systemic immune responses from T cells as well as IgM and IgG antibodies were generated to iPSCs without the hypoimmune edits, and the iPSCs were rapidly rejected within two to three weeks.

In the crossover portion of this experiment, injection of NHP hypoimmune iPSCs into NHPs that had previously received unmodified iPSCs again elicited no systemic responses as tested in assays for T cell or antibody responses. Similarly, macrophage and NK responses could not be detected. Correspondingly, these iPSCs survived for the full eight weeks that they were monitored, suggesting that pre-existing immunity to unmodified human iPSCs had no impact on hypoimmune iPSC survival. By contrast, in the NHPs that had previously been injected with hypoimmune iPSCs, the unmodified NHP iPSCs elicited both T cell and antibody responses. Notably, these unmodified iPSCs were rapidly rejected by the NHP within one to two weeks, while the previously injected hypoimmune iPSCs continued to be viable in the other leg of the NHP. These results confirm that the survival of the hypoimmune allo-graft was not an artifact of an impaired immune system or immune response in the recipient NHP. They also suggest that these hypoimmune iPSCs have the potential for immune evasion even the context of a new immune response toward iPSCs without these edits.

In addition, we recently conducted experiments in which we observed immune evasion and cell survival of hypoimmune NHP iPSC-derived cardiomyocytes and retinal pigment epithelial cells (RPEs). In separate experiments, these cardiomyocytes and RPEs were injected into the hearts and eyes (subretinal space), respectively, of healthy allogeneic NHP recipients without immunosuppression. Both the hypoimmune cardiomyocytes and RPEs were found to evade systemic adaptive and innate immune responses and survived for the duration of the applicable experiment. Separately, we have shown that hypoimmune NHP islet cells transplanted into a non-matched allogeneic NHP survive for the duration of the study, which at this point is 40 weeks.

We conducted an experiment to better understand whether hypoimmune modifications impair the function of islet cells and to confirm that these modifications enable the islet cells to evade immune responses. For these experiments, we made hypoimmune genetic modifications to NHP primary islets and then transplanted these islets intramuscularly, without immunosuppression, into a different NHP. We found that the hypoimmune islets were viable for the full duration of the study (approximately 10 months) and did not elicit either an adaptive or innate immune response. By contrast, unmodified NHP primary islets injected into a separate NHP were rejected within one week. These results suggest that hypoimmune modifications enable allogeneic immune evasion by NHP primary islet cells and increase our confidence in the clinical translatability of this approach.

Primary Allogeneic Hypoimmune NHP Pancreatic Islet Cells Survive in NHPs for 10 Months Without Immunosuppression

Hypoimmune NHP primary islets (top row) or unmodified wild type (wt) NHP primary islets (bottom row) were introduced via intramuscular injection into allogeneic NHPs. Unmodified NHP primary islets are undetectable in recipient NHPs by week 1 while hypoimmune NHP primary islets introduced into naïve NHPs were viable and detectable until the experiment was terminated at 40 weeks following injection. Primary islet cell survival in vivo is followed over time using bioluminescence imaging (BLI).

In January 2024, we presented data from a study transplanting allogeneic HIP-modified pancreatic islet cells into a fully immunocompetent, diabetic NHP. Subsequent to diabetes being induced in the NHP with streptozotocin, daily insulin injections were performed to re-establish glucose control. After 78 days, the NHP underwent transplantation of HIP primary islets by intramuscular injection, resulting in insulin independence without the use of any immunosuppression. As early as one week after the transplantation, the NHP’s serum c-peptide level had normalized, and it remained stable throughout the follow-up period of six months. The NHP showed tightly controlled blood glucose levels for six months, was completely insulin-independent, and was continuously healthy throughout this period with no use of any immunosuppression. Up to six months following HIP primary islet transplantation, peripheral blood mononuclear cells and serum were obtained from the NHP for immune analyses. HIP primary islets showed no T cell recognition, no graft-specific antibodies, and were protected from NK cell and macrophage killing. To demonstrate that the NHP’s insulin-independence was fully dependent on the HIP primary islets and that there was no regeneration of the animal’s endogenous islet cell population, we triggered the destruction of the HIP primary islets using a CD47-targeting antibody. This resulted in a loss of glycemic control and return to exogenous insulin dependence. We believe these data demonstrate potential evidence for immune evasion of HIP primary islets, graft-mediated insulin-independence of the diabetic NHP, and a potential safety strategy.

Hypoimmune Islet Cells Achieve Insulin Independence after Allogeneic Transplantation in a Fully Immunocompetent NHP

Fasting glucose monitoring in an NHP for about 10 months encompassing pre STZ, post STZ, post HIP islet cell transplant, and post anti-CD47 phases of the study: Diabetes mellitus was induced in a male NHP with STZ and daily insulin injections were started. Blood glucose was monitored twice daily and showed major instability over approximately two weeks until a well-controlled steady state was reached. After 78 days, the NHP was underwent intramuscular transplantation with allogeneic HIP islet cells. Insulin support was gradually withdrawn over approximately 12 days. The NHP did not receive immunosuppression before, during or after HIP islet cell transplantation. The NHP showed tightly controlled blood glucose levels and was completely insulin independent for six months.Following anti-CD47 mediated ablation of the graft, blood glucose levels increased steadily. Insulin injections were resumed eight days after the start of anti-CD47 antibody at the previously established maintenance dose. Despite insulin supplementation, widely fluctuating blood glucose levels were observed and no steady state was re-established for the remainder of the study.

Hypoimmune Islet Cells Normalize C-peptide Levels after Allogeneic Transplantation in a Fully Immunocompetent NHP

NHP serum C-peptide declines after induction of diabetes post STZ. As early as one week after the transplantation, NHP serum c-peptide level normalized (indicated by c-peptide levels of >2ng/ml) and remained stable throughout the follow-up period of six months. Destruction of HIP islet cells by anti-CD47 antibody coincides with the decline in C-peptide levels in the serum, confirming that HIP islet cells were required for continued production of C-peptide in the NHP.

Based on our preclinical data to date, we believe our hypoimmune technology has the potential to address the most fundamental limitation of ex vivo therapies, persistence, and thereby unlock waves of potentially disruptive therapies across a variety of cell types.

Safety Switch for Hypoimmune Cells

We are actively investigating approaches to control hypoimmune cells after administration into the patient. If necessary, the aim of these “safety switches” would be to provide a mechanism to eliminate hypoimmune cells within the body in a targeted fashion when the cells are not in a location where physical removal is feasible. Such a safety switch would mitigate the potential risk of adverse outcomes if a hypoimmune cell, which can, by its nature, evade the immune system, becomes infected with a virus or undergoes oncogenic transformation.

One approach we are exploring as a safety switch is re-sensitization of the hypoimmune cells to innate cell killing via administration of a blocking anti-CD47 antibody. We have tested the effectiveness of this approach in iPSCs and teratomas (a particular tumor formed by pluripotent cells with histological features from all three germ layers), both bearing the hypoimmune modifications. Using hypoimmune NHP iPSCs, we observed in vitro that the addition of an anti-CD47 antibody binds to and blocks CD47 expressed in the hypoimmune cells and restores their sensitivity to the missing-self killing response mediated by NK cells. We also assessed this strategy in mice that were transplanted with human iPSCs that formed small teratomas. Finally, we have conducted in vitro and in vivo experiments with this strategy using a number of human cancer lines, showing that an anti-CD47 antibody resensitizes cancer cells to killing by NK cells and macrophages. Treatment with an anti-CD47 antibody resulted in the loss of immune evasion and the rapid killing of these transplanted cells. As described above, use of an anti-CD47 antibody in a fully immunocompetent NHP was sufficient to trigger destruction of transplanted allogeneic HIP islet cells following initial survival of such cells for six months. We believe these data support use of anti-CD47 antibodies as a potential safety strategy. We have identified several additional safety switches with in vivo activity and intend to continue to explore them and potentially include multiple safety switches in our therapeutic programs moving forward.

Anti-CD47 Administration Results in the Rapid Clearance of Hypoimmune NHP iPSCs In Vitro

Left panel: Hypoimmune NHP iPSCs do not induce killing by NK cells in an in vitro killing assay. Right panel: By contrast, anti-CD47 antibody treated hypoimmune NHP iPSCs are no longer able to evade missing-self responses mediated by NK cells and are killed rapidly.

Anti-CD47 Administration Results in the Rapid Clearance of Human iPSC-derived Teratomas in a Humanized Mouse Model

Left panel: Human iPSCs proliferate (as visualized by luminescence of live cells) and form teratomas in NSG mice (n=3) with adoptive transferred human NK cells. Administration of isotype control has no impact on hypoimmune iPSC survival. Right panel: Blocking of CD47 in vivo results in killing of hypoimmune iPSCs (as visualized by luminescence of live cells) in NSG mice (n=5) with adoptive transferred human NK cells.

CD47 overexpression is differentiated in inhibiting “missing self” response relative to other approaches

As part of our ongoing efforts to further refine our hypoimmune technology, we evaluated the effectiveness of the overexpression of CD47 in comparison to other molecules that have at least some ability to inhibit innate immune responses. We carried out these head-to-head comparisons in K562 cells, a cell line that is naturally deficient in MHC class I and class II, and in which the lack of the MHC class I molecule should result in rapid cell killing by stimulated innate immune cells such as NK cells due to the activation of the “missing self” response. We compared three molecules, HLA-E, HLA-G, and PDL-1, each of which has previously been thought to play a role in inhibiting innate immune responses, against CD47. In this assay, overexpression of these three molecules conferred limited protection from NK cell killing as compared to CD47 overexpression. This difference in activity may be the result of the more ubiquitous presence of the receptor for CD47 on innate immune cells relative to the presence of receptors for these other immunomodulators. Although these results do not rule out a role for these other molecules in inhibiting NK cell responses, they suggest that CD47 may be sufficient to nullify the NK cell-mediated missing-self response.

CD47 Overexpression is Differentiated in Inhibiting “Missing Self” Response Relative to Other Approaches

Panels above show in vitro killing assays mediated by NK cells. Cells missing MHC molecules are killed by NK cells, as measured by rapid decline in cell index. Overexpression of immunomodulatory molecules such as HLA-E, HLA-G, or PDL-1 in cells missing MHC molecules did not block NK cell killing. By contrast, overexpression of CD47 blocked NK cell mediated missing-self response.

Our ex vivo Cell Engineering Pipeline

Allogeneic T Cell Programs (SC291, SC262, SC255)

Our allogeneic T cell programs utilize T cells from healthy donors to generate CAR T therapies for various targets, including CD19, a protein expressed on the cell surface of B-cell malignancies, for the potential treatment of patients with relapsed and/or refractory B-cell- malignancies and autoimmune diseases. We believe that applying our hypoimmune technology to allogeneic T cells will enable us to create differentiated allogeneic CAR T therapies.

We believe our allogeneic T cell programs are potentially disruptive programs that could address the limitations of adoptive T cell therapy for cancer. Specifically, as part of our allogeneic T cell programs, we have the opportunity to perform multiple gene edits in a T cell, which may allow us to make intentional modifications to control T cell function or deliver more complex chimeric receptors and signal integration machinery to enable the T cell to distinguish tumor cells based on surface antigen combinations and improve the specificity of targeting. These approaches may prove especially valuable in targeting solid tumors, which have remained largely refractory to CAR T approaches to date. We also have developed a scaled manufacturing process that we believe we can rapidly leverage to manufacture allogeneic CAR T cells across multiple targets.

Our most advanced product candidate is SC291, a CD19-directed allogeneic CAR T program. We are currently enrolling and dosing patients in the ARDENT trial evaluating SC291 in patients with NHL and CLL. In addition, in November 2023, we received IND clearance for the clinical study of SC291 in B-cell-mediated autoimmune diseases, including LN, ERL and ANCA-associated vasculitis, which we refer to as the GLEAM trial. The clinical trial startup activities for the GLEAM trial are currently underway, and we expect to share clinical data in 2024. In January 2024, we received IND clearance to evaluate SC262, a CD22-directed allogeneic CAR T, for the treatment of patients with relapsed and/or refractory B-cell malignancies who have received prior CD19-directed CAR T therapy, which we refer to as the VIVID trial. Clinical trial startup activities for the VIVID trial are also currently ongoing. We expect to share data from the VIVID trial in 2024. SC255, is our B-cell maturation antigen (BCMA)-directed allogeneic CAR T, for the treatment for multiple myeloma (MM). The SC255 program has completed a battery of pre-clinical tests and is currently gated based on resource availability.

Background on B-Cell Malignancies

B-cell malignancies represent a spectrum of cancers including NHL, CLL, ALL, and MM and result in over 100,000 deaths per year in the United States and Europe.

NHL is the most common cancer of the lymphatic system. NHL is not a single disease, but rather a group of several closely related cancers. Over 77,000 cases of NHL are diagnosed annually in the United States, and the most common subtype of NHL overall is diffuse large B-cell lymphoma (DLBCL). DLBCL, if left untreated, may have survival measured in weeks or months. Other common subtypes of NHL include mantle cell lymphoma (MCL), follicular lymphoma (FL), and marginal zone B-cell lymphoma (MZL).

CLL is the most common type of leukemia and occurs most frequently in older individuals, with diagnoses in people under 30 years of age occurring only rarely. Each year, approximately 20,000 patients are diagnosed with CLL in the United States. Approximately 20 to 25% of CLL patients initially present with high-risk disease. Median progression-free survival in these high-risk individuals is often less than 12 to 18 months after front-line therapy and less than 12 months in relapsed or refractory (R/R) disease.

ALL is a type of leukemia that results from an uncontrolled proliferation of lymphoblasts, which are immature white blood cells. Lymphoblasts, which are produced in the bone marrow, cause damage and death by inhibiting the production of normal cells. Approximately 6,000 patients are diagnosed with ALL in the United States each year, and the vast majority of the approximately 1,500 ALL deaths per year occur in adults. Approximately 80% of cases of ALL in the United States and Europe are B-cell ALL, which almost always involves cancer cells that express the CD19 protein. The five-year overall survival rate in ALL adults over the age of 60 is approximately 20%, and the median disease-free survival in patients with R/R ALL after two or more lines of therapy is less than six months. B-cell ALL is the most common cancer in children. Although children with ALL fare better than adults, children with R/R disease have poor outcomes. Because of the frequency of this disease, ALL remains a leading cause of death due to cancer in children.

MM is a cancer of the plasma cells, which are B-cells that have matured to specialize in the production of antibodies, and which typically express the BCMA protein. MM is a condition in which plasma cells become malignant and grow at an uncontrolled pace. These cells secrete large quantities of the same antibody, resulting in patient symptoms that result from the myeloma cells crowding out other plasma and bone marrow cells, including increased risk of infection, risk of bone destruction, and kidney disease. MM is the second most common hematologic malignancy, comprising approximately 2% of all cancers and accounting for over 34,000 new cases per year, with 12,600 deaths estimated to have occurred in 2022 in the United States.

High Mortality in Lymphoma, Leukemia and Multiple Myeloma in United States and EU5

Hematologic malignancies result in a large number of annual death across the United States and Europe. Only a small fraction of patients have durable remissions following CAR T therapy.

Current Treatment Landscape and Unmet Need

First-line therapy for NHL typically consists of multi-agent cytotoxic drugs in combination with the monoclonal antibody rituximab. In younger patients with NHL who have good organ function, high dose chemotherapy followed by stem cell transplantation is often used. Patients often relapse, however, and since 2017, several therapeutics have been approved in the United States for the treatment of patients with R/R NHL who have received prior therapies. These approved therapies include CD19 CAR T therapies tisagenlecleucel, axicabtagene ciloleucel, and lisocabtagene maraleucel, CD19 antibody drug conjugate therapy polatuzumab vedotin, and CD19 antibody tafasitamab. Recently, two autologous CD19 CAR T products have been approved in second-line patients with R/R NHL after proving to be superior to standard of care in pivotal trials, raising the possibility that CD19 CAR T cell therapies may have the potential to have a broader impact for patients with NHL.

Newly diagnosed CLL patients are often treated with targeted therapies such as BTK inhibitors, PIK3 inhibitors, BCL-2 inhibitors, or monoclonal antibodies targeting CD20 or CD52 in combination with chemotherapy. However, most patients treated with these regimens become refractory. Numerous drug candidates, including next-generation kinase inhibitors, are in clinical development for refractory patients. Autologous CD19 CAR T cell therapies are also beginning to progress through clinical trials, with a recent Phase 1/2 study in R/R CLL reporting that it had met its primary endpoint of complete response.

Cure rates for ALL patients have continued to increase over the last four decades, with pediatric ALL cure rates reaching greater than 80% in developed countries. This progress has been enabled by advances in combination chemotherapy, monitoring of minimal residual disease, expanded use of kinase inhibitors for Philadelphia chromosome-positive ALL, and the recent approval of Kymriah® for R/R pediatric ALL. Adult patients fare much worse, however, with 5-year overall survival rates of approximately 20%, and there are still significant challenges managing R/R disease across all age groups. Multiple therapeutic candidates are in development for R/R patients, including proteasome inhibitors, antimetabolites, JAK inhibitors, and monoclonal antibodies, as well as autologous and allogeneic CAR T candidates.

There are no curative treatment options for MM patients. First-line therapy for MM consists of induction therapy and high-dose chemotherapy followed by a potential stem cell transplant, and the standard of care for R/R MM includes immunomodulatory agents, proteasome inhibitors, monoclonal antibodies, cytotoxic agents, and hematopoietic stem cell transplant. Despite the recent advancement in available therapies for MM disease management, the five-year overall survival rate remains at approximately 50%. Given this significant unmet need, several groups are investigating autologous and allogeneic CAR T cell therapies for R/R MM. BCMA is among the most promising antigens used to target MM, with two BCMA CAR T therapies (idecabtagene vicleucel and ciltacabtagene autoleucel) having received marketing approval in late-line R/R MM. Recently, both drugs have been used to dose patients in pivotal clinical studies for patients with R/R MM in earlier lines of therapy, where they outperformed standard of care. Novel treatments with other mechanisms of action are also undergoing development, including bispecific T cell engagers, next-generation antibodies, and antibody drug conjugates.

As highlighted above, recent therapeutic advances across R/R B-cell malignancies have led to a variety of treatment options and better patient outcomes. In particular, autologous surface protein-directed CAR T therapies have been highly effective in certain subsets of patients with R/R disease. However, not all patients have access to these novel therapies, and even if they able to obtain such access, many patients ultimately relapse following treatment and succumb to their cancer, resulting in 100,000 deaths per year in the United States and Europe across these indications.

There are two primary outstanding challenges that have limited utilization of these CAR T therapies and their impact on broader groups of patients: relapse and manufacturing challenges.

Lack of Response / Relapse. Only about 50% of patients treated with an approved CD19-directed CAR T therapy will have a complete response and approximately one-third of patients with a complete response will relapse relatively quickly. The emerging post-approval data from approved CAR T therapies tisagenlecleucel, axicabtagene ciloleucel and lisocabtagene maraleucel indicate that relapse can result from one of two primary factors.

The first involves loss of CD19 expression on malignant cells, resulting in tumor escape. This finding was initially established for ALL and is the cause of relapse after CAR T treatment for roughly half of treated patients. More recent data indicate that low CD19 expression contributes to the lack of response in a meaningful number of patients with NHL. CD19 CAR T treatments have recently been tested in pivotal trials in earlier lines of therapy for NHL, which raises the possibility that more patients will be treated with CD19 CAR T therapy and subsequently relapse due to CD19 loss. Patients with CD19 therapy failure have an extremely poor prognosis, with overall survival measurable in months and virtually no treatment options. Therefore, the development of CAR T therapies targeting an alternate antigen other than CD19 may provide an opportunity to address this growing unmet need. Data from several studies have shown that CD22 CAR T treatment has led to complete responses in NHL and ALL patients that failed to reach a complete response or relapsed after CD19 CAR T treatment.

The second pattern of relapse relates to suboptimal CAR T cell functionality, such as poor expansion, poor persistence, or T cell exhaustion, resulting in relapse and continued growth of cancer cells that retain the targeted antigen. Re-infusion with the same CAR T therapy has had limited benefit in these patients, although treatment with a different CAR T therapy has demonstrated some promise in ongoing clinical trials.

Manufacturing. Because autologous CAR T therapies are patient-specific products, their manufacturing process is complex and requires a significant amount of resources, including time and labor. Given this, infrastructure and cost considerations and limitations have resulted in limited patient access to these therapies. Even for patients who are fortunate enough to have access to approved CAR T therapies, delays, commonly of at least one month, resulting from scheduling difficulties and issues that arise during manufacturing may prevent use of and the utility of these therapies in patients with rapidly progressing malignancies. Certain groups are seeking to overcome access limitations by using healthy donor-derived, or allogeneic, CAR T cells instead of patient T cells to yield “off-the-shelf” therapeutics that can be manufactured consistently. However, efficacy and durability concerns remain, largely due to the inability to effectively control the HvGR response and the risk of eventual immune rejection of these products by the recipient. We are developing our ex vivo allogeneic T cell programs to address this HvGR and prevent immune rejection.

Background on B-Cell-Mediated Autoimmune Disease

Autoimmune diseases arise from immune system dysfunction whereby the body’s immune cells mistakenly attack healthy cells and tissues in the body. These diseases are typically characterized by defects in the adaptive immune response involving B-cells and/or T cells. These diseases can manifest across multiple organ systems and lead to a decreased quality of life or even severe disability in patients. B-cell depletion has been shown to provide clinical benefit in autoimmune disorders mediated by dysfunctional B-cells, including SLE, systemic sclerosis, myositis, MS, ANCA-associated vasculitis, and others. Collectively, these diseases afflict more than 5 million patients in the United States alone.

SLE is a chronic autoimmune disease that predominantly affects women of childbearing age. Immunologic abnormalities, especially the production of antinuclear antibodies (ANA), are a prominent feature of the disease. The exact cause of SLE remains unclear, but it is thought to result from a combination of genetic predisposition and environmental triggers. SLE presents with a wide range of clinical signs and symptoms, as well as serologic findings, and can affect multiple organ systems. SLE has a prevalence of approximately 400,000 across the United States, EU5, and Japan. About 60% of SLE patients are diagnosed with LN after clinical indication of kidney involvement. The remainder are classified as having extrarenal lupus. The renal complications are detected through an abnormal urinalysis arising during the disease course. LN is one of the most severe complications of SLE, in which autoantibodies cause damage to the glomerular structures in the kidney, which can result in end-stage renal disease (ESRD). Patients with ESRD have a 5-year survival rate of 50%.

ANCA-associated vasculitis is a group of diseases characterized by loss of immunological tolerance to neutrophil protein, which causes inflammation of small blood vessels. The primary clinical manifestations of the disease occur in the upper respiratory tract, in the kidneys, or as asthma. The cause of ANCA-associated vasculitis is not fully understood and believed to be in part due to genetic susceptibility and environmental triggers. There are about 60,000 ANCA-associated vasculitis patients in the United States. Left untreated, ANCA-associated vasculitis is associated with significant morbidity, but with proper treatment, the 5-year survival rate ranges from 80% to 90%.

Current Treatment Landscape and Unmet Need

Currently, there is no standard of care treatment for achieving drug-free remission in LN patients; therefore, patients often require life-long therapy. While a combination approach using antimalarials (hydroxychloroquine), systemic steroids, and conventional immunosuppressant medicines (such as azathioprine (AZA), Mycophenolate mofetil (MMF), and cyclophosphamide) are first-line options, a significant proportion of patients continue to have high disease activity and recurrent relapses despite therapy. Rituximab, initially approved by the FDA in 1997 for the treatment of R/R NHL, is a monoclonal antibody (mAb) that selectively targets the B-cell specific surface molecule CD20. The LUNAR trial of rituximab failed to meet the primary endpoint of complete renal response after treatment with rituximab, although the trial demonstrated partial responses in selected patients. Complete peripheral depletion of B-cells with rituximab was not observed in all participants, and even in participants where complete peripheral depletion of B-cells was observed, less than 50% achieved complete response. A retrospective analysis of these data demonstrated that deeper B-cell depletion was associated with improved complete renal responses, and that poor tissue B-cell depletion was associated with non-response. The continued persistence of autoreactive B-cells in protected microenvironments, such as the lymphoid germinal center structures, correlated with the partial success of this approach in LN. Treatments for ERL include low intensity therapies such as low-dose corticosteroids, antimalarials, and NSAIDS. Based on worsening disease manifestations, additional immunosuppression medications can include high dose prednisone, methotrexate (MTX), AZA, and MMF, which are known to have side effects and increase the risk of significant infection. The pivotal trial of the anti-BAFF mAb belimumab in these patients demonstrated a clinically meaningful improvement in patient outcomes in a large trial that enabled the first FDA drug approval for the treatment adult patients with SLE. Although this large trial demonstrated a reduction of disease activity compared to placebo control, approximately 20% in all groups still experienced a severe disease flare. Anifrolumab, a mAb targeting the interferon alfa signature known to be elevated in SLE patients, was approved by the FDA in 2021 for the treatment of adult patients with SLE. Only 15% of the patients met the criteria for remission at 52 weeks, highlighting the unmet need in patients. Since the 1970s, cyclophosphamide has been the standard of care therapy for ANCA-associated vasculitis, demonstrating a survival benefit compared to corticosteroids alone. However, the dose-limiting toxicity of cyclophosphamide results in treatment failure and risk of chronic relapse. Rituximab was approved for this indication based on a clinical trial in which it was shown to be non-inferior to cyclophosphamide for remission (at six months), supporting the role of B-cell depletion in the treatment of these patients. A complement C5a receptor, avacopan, was recently approved in this indication. Despite this recent success and FDA and European Medicines Agency approval, 35-45% of patients do not achieve remission of disease at one year with these new therapies. There is strong evidence to suggest that B-cell depletion with CD19-directed CAR T cell therapy is feasible and highly effective in patients with SLE. In a study published in 2022 from Germany, five SLE patients between 18 and 24 years of age were treated with autologous CD19-directed CAR T cell therapy. These SLE patients had multiorgan involvement and were refractory to a variety of immunosuppressive drug treatments. After lymphodepleting chemotherapy with fludarabine and cyclophosphamide, autologous CD19-directed CAR T cells were administered as a single intravenous infusion.Full depletion of B-cells was observed from peripheral blood in all patients from Day 2 following CAR T cell infusion, resulting in an improvement in clinical symptoms and evidence of decline of ANAs. These data suggest that CD19-directed CAR T cell therapy induces deep B-cell depletion in tissues such as lymph nodes and highlights a key advantage in the use of CD19-directed CAR T cell therapy compared to antibody-mediated B-cell depletion. All patients achieved remission status by three months, with drug-free remission maintained over a median of eight months. B-cells did reappear in these patients after approximately 110 days; however, these B-cells were naïve and showed non-class-switched B-cell receptors, suggesting elimination of B-cell subsets generating autoantibodies and a reset of the B-cell repertoire. Despite the reconstitution of B-cells, patients did not experience flares of SLE or need additional immunosuppressive medication, indicating the achievement of drug-free remission. As of December 2023, the drug-free clinical remission in the first patient continues almost three years following CAR T treatment. Previous studies using CD19-directed CAR T cell therapy in lymphoma and leukemia have reported CRS and ICANS occurring frequently after treatment. However, the five SLE patients receiving CAR T cell therapy had either no reported CRS or only Grade 1 CRS. None of these five patients developed ICANS, indicating low therapy-related toxicity with CAR T cell treatment in these patients. As of ASH 2023, this group had treated a total of fifteen patients across three B-cell mediated autoimmune diseases, namely SLE, Idiopathic Inflammatory Myositis and Systemic Sclerosis. Clinical remission was reported across all patients and CAR T treatment was well tolerated without the need for further immunosuppression. The first patient (treated for SLE) continued to be in remission beyond 800 days.

In the ongoing ARDENT trial, we have observed the pharmacodynamic effect of peripheral blood B-cell depletion, which refers to diminishing B-cell counts in the peripheral blood, associated with SC291 treatment in patients. While pharmacodynamic effects seen in oncology patients may not translate to patients with autoimmune disease, we believe these data increase the probability that SC291 treatment confers similar B-cell depletion, the putative mechanism of benefit, to patients with B-cell-mediated autoimmune disorder.

Limitations of Allogeneic CAR T Therapies

We believe our hypoimmune cells have the potential to create a differentiated platform for developing allogeneic T cells, and to address two major hurdles associated with use of allogeneic T cells. The first is the risk of GvHD, in which the allogeneic donor T cells target and kill recipient tissues. Multiple CAR T cell product candidates in clinical development have prevented this reaction through gene edits targeting components of the T cell receptor, such as TCR-alpha gene. The more significant challenge has been HvGR, in which the patient’s immune system kills the transplanted T cells. One strategy to address this challenge has been to essentially eliminate the patient’s immune system, neutering its ability to find and destroy the transplanted allogeneic CAR T cells. However, this strategy has two limitations. First, the patient is at risk for developing severe infections during this period of substantial immune suppression. Second, as the immune system returns following immune suppression, it will inevitably reject the allogeneic CAR T cells, limiting their persistence, or the duration that these therapeutic cells are in the body. In multiple independent clinical trials, regardless of the disease setting, allogeneic CAR T cells have been shown to be cleared from the patient immune system in less than a month despite high dose immunosuppression. The therapy recipients often experience short lived clinical responses with the lack of durability correlating with the poor persistence of the allogeneic cells. Conversely, the clinical experience with autologous CAR T cells has demonstrated that longer persistence of the CAR T correlates with durable cancer remission. Thus, the ability to effectively prevent long-term rejection of an allogeneic CAR T therapy without significant immune suppression would provide a significant advantage over existing allogeneic approaches. We are aware of other efforts to develop allogeneic CAR T cell products that focus on overcoming the adaptive immune system, consisting of T and B-cells. However, our hypoimmune technology addresses rejection mediated by both the adaptive and innate immune systems, which we believe will enable us to create a differentiated allogeneic CAR T solution.

Our Allogeneic T Cell Approach

Our hypoimmune technology is designed to “hide” the cell from the patient’s immune system, and we are applying this technology for the clinical development of hypoimmune allogeneic CAR T cells for a variety of therapeutic applications. Our allogeneic T cell platform is designed to enable the substitution of CAR constructs in a modular fashion. Initial clinical success with SC291 would support the expansion of our allogeneic CAR T efforts and enable additional product candidates to be brought forward and developed. We are prioritizing clinically-validated cancer antigens as well as CAR constructs that have shown robust safety and efficacy profiles in hematologic malignancies in the autologous context.

Our manufacturing process begins with T cells from healthy donors, into which we introduce the CAR gene, make the gene modifications necessary to avoid GvHD, and incorporate our hypoimmune modifications to prevent host versus graft disease. We then expand these cells ex vivo, which enables us to both make many batches from a single T cell donor as well as create comparable CAR T cells derived from different donors. Our vision is to freeze these allogeneic CAR T therapies, store them, and deliver them to cancer patients as an “off the shelf” product without requiring severe immunosuppression.

Preclinical Data

For our preclinical studies, human donor T cells were genetically modified ex vivo to generate T cells with hypoimmune modifications (disruption of MHC class I/class II; overexpression of CD47), TCR-alpha disruption (to mitigate GvHD), and the expression of a CD19 CAR. These cells, as well as unmodified CD19 CAR T cells, were then tested in vivo for their tumor-killing activity in a human xenograft mouse model for leukemia (Nalm-6). These preclinical data suggest that the hypoimmune modifications do not interfere with CAR T killing activity. We observed initial clearance of the leukemic cells by both the hypoimmune CD19 CAR T cells and the unmodified CD19 CAR T cells, which are similar to CAR T cells currently in clinical use. However, the unmodified CD19 CAR T cells were eventually rejected by the host immune system, and tumor regrowth began after about two months.By contrast, in hypoimmune CD19 CAR T injected mice, tumor control was maintained throughout the study, including following a rechallenge at day 83 with Nalm-6 leukemia cells, without further administration of hypoimmune CD19 CAR T cells. Analysis of immune cells from the bone marrow and spleen at the study endpoint confirmed persistence of the hypoimmune CD19 CAR T cells.

Hypoimmune Donor-Derived CD19 CAR T Cells Demonstrate Persistence and Sustained Tumor Clearance in a Human Xenograft Mouse Model

Activity of hypoimmune donor-derived CD19 CAR T in a mouse leukemia xenograft model (Nalm-6). When compared to untreated controls, infusion of unmodified CD19 CAR T or hypoimmune CD19 CAR T results in eradication of leukemia cells. Tumor regrowth was visible in animals treated with unmodified CD19 CAR T cells by Day 57; by contrast, hypoimmune CD19 CAR T-treated animals remained tumor free. Leukemia tumor cells were reinjected into both sets of animals at Day 83 and markedly greater tumor clearance was seen in the hypoimmune CD19 CAR T-treated animals. Note: Animals were not retreated with CAR T cells after initial dosing.

Furthermore, the absence of adaptive or innate immune system activation by hypoimmune CD19 CAR T cells in the humanized mice was confirmed in vitro.

Clinical Data

In January 2024, we disclosed initial interim clinical data from the ongoing ARDENT trial. Results of our early interim analysis of clinical safety and other clinical responses are discussed above under “Overview.”

Analysis of Patient Immune Responses to SC291

The SC291 drug product contains CAR T cells that are fully edited hypoimmune cells, which we describe as HIP-edited CAR-T cells, along with partially edited cells, which we describe as non-HIP CAR T cells. In vitro testing showed evidence that blood and immune cells from each of the four evaluable patients had mounted an immune response to the non-HIP CAR T cells but not to the HIP-edited CAR T cells. Specifically, HIP-edited CAR T cells from the drug product were not rejected by the innate immune response mediated by the patient’s NK cells, nor did the patients have T cell or antibody responses that recognized these cells. In contrast, we observed immune responses against the non-HIP CAR T cells in the drug product.

Initial Clinical Safety and Efficacy of SC291 in ARDENT Clinical Trial

SC291 is a Mixture of T cell Subpopulations Including HIP and Non-HIP CAR T Cells

Patient T cells Kill WT CAR T Cells But Do Not Kill DKO T cells or HIP CAR T Cells

Upper panel: T cells from a patient receiving SC291 showed no activation when exposed to HIP CAR T (CD47-CD19 CAR; HLAI/II deficient) cells from SC291 drug product in vitro. Patient T cells were collected 5 days prior to SC291 infusion (D-5) and at Day 13 (D13) and Day 28 (D28) after SC291 infusion. Robust patient T cell activation was detected versus WT CAR T cells (CD47-CD19 CAR) from SC291 drug product in vitro. In contrast, no T cell activation was seen versus dKO T cells (HLA I/II deficient cells) and HIP CAR T cells from SC291 drug product in vitro.

Lower panel: T cells from a patient receiving SC291 showed no killing of HIP CAR T cells in SC291 drug product in vitro. Patient T cells were collected 5 days prior to SC291 infusion (D-5) and Day 28 (D28) after SC291 infusion. Robust patient T cell-mediated killing was detected versus WT CAR T cells and dKO T cells from SC291 drug product in vitro. In contrast, no patient T cell-mediated killing was seen versus HIP CAR T cells in SC291 drug product in vitro.

Patient Generates Antibodies Against WT CAR T Cells But Not DKO T Cells or HIP CAR T Cells

Patient receiving SC291 generated an antibody response to WT CAR T cells, but not to dKO T cells or HIP CAR T cells. Antibody response was assessed from patient sample collected 5 days prior to SC291 infusion (D-5) and at Day 28 (D28) after SC291 infusion. Antibody production was measured by quantifying the binding of IgG to WT CAR T cells, dKO T cells, and HIP CAR T cells purified from the SC291 drug product.

Only HIP CAR T Cells Evade Patient NK Cell Killing

NK cells from a patient receiving SC291 kill dKO T cells but not HIP CAR T cells. Patient NK cells were isolated at Day 13 after SC291 infusion. An in vitro NK-cell mediated cell killing assay was performed over a four-hour period with fluorescent labelled dKO T cells or HIP CAR T cells. Patient NK cells rapidly killed the dKO T cells as evidenced by the extinction of the GFP signal. In contrast, patient NK cells did not kill HIP CAR T cells.

Development Plan and Key Next Steps

We believe the initial ARDENT safety and clinical data described above support continued dose escalation and expansion within the trial to treat additional patients and monitor outcomes over longer periods of time. We expect to share additional data from the ARDENT trial in 2024. We also expect to report progress on the GLEAM trial, in which we are evaluating SC291 in LN, ERL, and ANCA-associated vasculitis. The potential for B-cell depletion with SC291, as seen in ARDENT, may provide clinical benefit to patients with B-cell-mediated autoimmune disease. We also plan to share data from our VIVID trial, in which we are evaluating SC262 (hypoimmune-modified CD22 CAR T) in patients with relapsed and/or refractory B-cell malignancies who have received prior CD19-directed CAR T therapy. We are also advancing our SC255 allogeneic T cell program targeting BCMA for MM. The SC255 program has completed a battery of pre-clinical tests and is currently gated based on resource availability.

Pancreatic Islet Cell Program

Our pancreatic islet cell product candidate, SC451, is a hypoimmune PSC-derived pancreatic islet cell product candidate that aims to restore glucose control in T1DM patients by transplantation into these patients without the need for immunosuppression. Current therapies for T1DM require continual management, and we believe that effectively restoring islet cell functionality will meaningfully improve outcomes for T1DM patients, which is supported by data from T1DM patients who have successfully received primary islet transplants with immunosuppression. We are currently engaged in preclinical activities for SC451.

In November 2023, the Swedish Medical Products Agency authorized Uppsala University Hospital’s a CTA for the IST, a first-in-human study evaluating UP421, an allogeneic, primary islet cell therapy engineered with our HIP technology, in patients with T1DM. Patients in this study will receive no immunosuppression. We believe that immunology insights gained from the IST, particularly with respect to whether HIP modifications lead to long-term survival and evasion of either allogeneic or autoimmune killing of the transplanted cells, may provide direct insights applicable to our SC451 program. We expect data from the IST to be shared in 2024.

Background on Type 1 Diabetes Mellitus

T1DM is an autoimmune disease in which the patient’s immune system destroys its own pancreatic islet cells. The destruction of these cells leads to complete loss of insulin production and a metabolic disease wherein patients are unable to control their blood glucose levels. Often called “juvenile diabetes,” T1DM disease onset commonly occurs in adolescence. Beta cells reside in specialized hormone-producing clusters within the pancreas called the islets of Langerhans. In T1DM, activated T lymphocytes infiltrate the islets and selectively kill the beta cells, progressively reducing the body’s capacity to produce insulin. Once the reserve capacity of beta cells is exhausted, blood glucose rises, and the patient will have a lifelong battle to control blood glucose levels. Without insulin therapy, T1DM is rapidly fatal. T1DM current affects more than eight million patients worldwide.

Current Treatment Landscape and Unmet Need

Insulin injection is the main treatment option for T1DM. Despite significant advances in types of insulins, glucose monitoring, and insulin pumps, life expectancy for T1DM is still approximately 15 years shorter than for people without diabetes. Patients are at risk of acute complications of hyperglycemia, including diabetic ketoacidosis, coma, and death, as well as hypoglycemic episodes, particularly at night, which can lead to the “dead in bed” syndrome, thought to result from cardiac arrhythmias induced by low glucose. Long term elevations in blood glucose levels can have particularly devastating effects on arteries and capillaries, resulting in premature myocardial infarction, stroke, limb ischemia, gangrene, kidney failure, and blindness due to diabetic retinopathy. “Insulin pumps,” which feature a computerized system for sensing blood glucose and delivering appropriate doses of insulin, have improved glycemic control, though data from the FDA indicate that issues with insulin pumps are among the most frequently reported problems in their database. All current therapies require patients to carefully monitor their dietary intake, which, although inconvenient in adults, is a frequent point of failure in adolescents.

Pancreas transplantation for uncontrollable diabetes was first performed in the 1960s and established the principle that replacing the beta cells (here, in the context of the entire pancreas) could restore physiological glucose control. Pancreas transplants are complicated surgical interventions, require lifelong immunosuppression, and are limited due to organ availability. Nevertheless, some 30,000 pancreas transplants have been performed worldwide to date.

Because of these challenges, the biomedical community began exploring pancreatic islet transplantation in the 1970s. This process requires enzymatic digestion of a donor pancreas and isolation of the islets of Langerhans, followed by delivery of these cells to an appropriate site in the body where the islets can engraft and become well-vascularized. The major lessons from islet transplantation have been that glucose homeostasis can be restored, insulin independence can be achieved, levels of hemoglobin A1C (a marker of long-term glucose levels) can be normalized, severe episodes of hypoglycemia can be reduced, and the pathology associated with long-term hyperglycemia can halt or even reverse. As with an organ transplant, patients must undergo chronic immune suppression to prevent immune rejection of the transplanted cells. Most patients lose glucose control over a period of months to years and eventually become insulin-dependent again, primarily due to immune rejection of the allogeneic islets resulting from an inability to tolerate the significant immune suppression necessary to protect the cell transplant.

Our Pancreatic Islet Cell Program Approach

The goal of our SC451 program is to restore glucose control in T1DM patients by transplanting hypoimmune PSC-derived islet cells, including beta cells, without the need for immunosuppression, giving patients physiologically appropriate glucose sensing and insulin secretion. We believe this therapy could reduce, or even eliminate, hypoglycemia and hyperglycemia in T1DM patients, potentially enabling less onerous and costly treatment, fewer complications, a meaningfully improved quality of life, and longer life expectancy.

We focus our efforts around three goals: (i) deriving highly functional islet cells from PSCs, (ii) using our hypoimmune technology to genetically modify these cells to evade allogeneic immune responses, and (iii) using our hypoimmune technology to genetically modify these cells to evade autoimmune destruction of islet cells. This strategy requires building on lessons from pancreatic islet transplantation, recent advances in understanding pancreatic islet developmental biology, and our hypoimmune technology.

Deriving islet cells from PSCs has the potential to solve limitations associated with use of a donor pancreas and improve the overall product quality and product consistency. PSCs have the potential to create a virtually limitless supply of these cells. Our program uses proprietary differentiation protocols to generate mature islet cells with glucose control comparable to primary human islets, as evidenced by our animal studies. Finally, we are applying our hypoimmune technology to modify the genomes of the PSCs. If successful, the hypoimmune genome modifications will protect these PSC-derived islet cells from both autoimmune and allogeneic rejection by the patient’s immune system and potentially remove the need for toxic immunosuppression in transplant recipients. Hypoimmunity also eliminates the need for physical separation of the islet cells from the rest of the body by a device or encapsulation technology, which may allow for tighter glucose control by eliminating the lag time between glucose sensing and insulin secretion as well as avoiding the fibrotic reaction inherent in encapsulation technologies to date.

Preclinical Data

We are developing a proprietary protocol to differentiate hypoimmune PSCs into mature, glucose-sensitive, insulin-secreting islet cells. We are exploring ways to optimize the differentiation of islet cells at a greater purity and with superior function compared to published stem cell-based protocols. The principal function of beta islet cells, the insulin-secreting cells within an islet, is to maintain steady levels of glucose in circulation. The beta islet cells sense when glucose levels rise in the bloodstream and release insulin in response. In vitro, we have observed that our PSC-derived islet populations can respond to glucose and secrete insulin.

Human PSC-Derived Islet Cells Exhibit Glucose-Induced Insulin Release

Human islets from cadaveric pancreases exhibit robust insulin secretion in response to an increase in glucose levels. Human PSC-derived islet cells using technology licensed from Washington University demonstrate similar levels of insulin secretion as the cadaveric islets.

These PSC-derived islet cells were tested in a mouse model of T1DM induced by the beta cell toxin, STZ. When transplanted into the kidney of the T1DM mice, these islet cells normalize glucose levels in an equivalent fashion to primary human islets. The diabetic glucose levels return when the grafts are surgically excised via nephrectomy. Similar to the human phenotype, T1DM mice cannot normalize circulating glucose levels following a glucose injection. Following transplantation of our islet cells, these mice rapidly normalized blood glucose in an equivalent fashion to both non-T1DM mice and T1DM mice that received human primary islet transplants.

In vivo Performance of iPSC-Derived Islet Cells in a Mouse Model of T1DM

Top panel: Normalization of blood glucose levels after transplantation of cadaveric human islet cells or PSC-derived islet cells obtained by planar or suspension differentiation (based on Washington University technology). Note the rapid normalization of blood glucose with cadaveric and PSC-derived islets with the planar protocol, with slower normalization using the suspension protocol. In all groups, removal of the graft by nephrectomy re-induced diabetes, indicating the correction resulted from the transplant. STZ is a toxin for beta islet cells that induces diabetes in animal models. Bottom panel: Normalization of blood glucose after glucose injection by transplantation of cadaveric islet cells or PSC-derived islet cells. Note the more complete normalization using the planar protocol. Groups are defined by the same symbols shown in the top panel. From Hogrebe et al, Nature Biotechnology 2020.

We next tested whether hypoimmune modifications to iPSC-derived islet cells can enable evasion of autoimmune rejection. We approached this question in two ways.

First, we carried out transplantation experiments in the non-obese diabetic (NOD) mouse model, which develops spontaneous T1DM due to induction of autoantibodies and autoreactive T cells that kill the islet cells. We isolated islets from pre-diabetic NOD mice and applied hypoimmune technology to these islets to generate hypoimmune NOD islet cells, which we transplanted into diabetic NOD mice. When transplanted into NOD mice, unmodified NOD islet cells were rejected within approximately two weeks and had no impact on the diabetes. By contrast, the hypoimmune NOD islet cells survived and achieved durable glycemic control within two weeks.

In a second set of experiments, we tested whether we would observe similar findings in a human T1DM model. Because a T1DM patient has no functioning islets, we used iPSC technology to generate islet cells with the same genetic makeup as the patient. To accomplish this, we reprogrammed immune cells from a T1DM patient donor into iPSCs. We then split the iPSCs into two groups – one group to which we applied hypoimmune modifications and one that remained unmodified – before differentiating these cells into islet cells using our differentiation protocol. The end result was two different cell products for testing – (i) hypoimmune iPSC-derived islet cells and (ii) unmodified iPSC-derived islet cells. To simulate the immune environment of a T1DM patient, we developed a proprietary humanized mouse model (T1D mice) which is populated with immune cells from the same T1DM patient donor and subsequently in which diabetes is induced via STZ. Unmodified iPSC-derived islet cells injected intramuscularly into T1D mice were rejected within nine days without any impact on the T1D mice’s diabetes. By contrast, hypoimmune iPSC-derived islet cells survived in T1D mice and resulted in glucose control within two weeks. To confirm that the autoimmune rejection remained intact in these mice, we tested the impact of a subsequent injection of iPSC-derived islet cells in these mice that had already been injected with hypoimmune iPSC-derived islet cells. We found that, although the iPSC-derived islet cells were rapidly rejected, the hypoimmune iPSC-derived islet cells and the glucose control were preserved. Together, these data support the belief that our hypoimmune modifications can enable evasion of autoimmune rejection.

Autologous Pancreatic Islet Experiment

A, Experimental schema for generating a humanized T1D mouse and autologous iPSCs from T1D patient PBMCs. T1D patient PBMCs were used to generate iPSCs, which were used to generate unmodified and hypoimmune autologous islet cell. B, Unmodified iPSC-derived autologous islets are cleared by the immune system of the humanized T1D mouse by Day 7 and did not restore glycemic control C, Hypoimmune iPSC-derived autologous islets (injected on left side of mouse) survive for duration of experiment (until Day 29) while unmodified iPSC-derived autologous islets (injected on right side of mouse at Day 15 post hypoimmune iPSC-derived autologous islet injection) are cleared within a week of injection.

Development Plan and Key Next Steps

In November 2023, the Swedish Medical Products Agency authorized Uppsala University Hospital’s clinical trial application for the IST, a first-in-human study evaluating UP421, an allogeneic, primary islet cell therapy engineered with our HIP technology, in patients with T1DM. Allogeneic primary islet cell transplantation into T1DM patients has been shown to reduce long-term exogenous insulin dependence when administered with immunosuppression. Subjects in this study will receive no immunosuppression. We expect that data from the IST, particularly with respect to whether HIP modifications lead to long-term survival and evasion of either allogeneic or autoimmune killing of the transplanted cells, will provide insight into the impact of HIP modifications that we plan to apply to our SC451 program in enabling evasion of allogeneic and autoimmune rejection.

We believe that a stem cell-derived islet product candidate such as SC451 would likely maximize the benefit to patients, with potentially greater manufacturing scalability as compared to primary islet cells. Further, if the IST demonstrates persistence of allogeneic hypoimmune primary islet cells, it may accelerate our development of SC451.

Our work on the SC451 program is currently focused on manufacturing GMP-grade, genome-edited, PSC banks; scaling manufacturing; and characterizing the product.

GPC Program

Our GPC program, SC379, aims to deliver to patients healthy allogeneic GPCs, which are the precursors to both astroglia and myelin-producing oligodendrocytes. This program has the potential to treat myelin- and glial-based disorders, which represent a broad group of debilitating neurological disorders, such as MS and a number of neurodegenerative disorders, none of which have effective treatment alternatives. We intend to develop our stem cell-derived GPC therapy for secondary progressive MS, PMD other disorders of myelin, Huntington’s disease, and other astrocytic diseases.

Background on Myelin- and Glial -Based Disorders

Glial cells are the support cells of the human CNS. The two major types of CNS-derived glial cells are oligodendrocytes, which are the cells that produce myelin, the insulating substance of the brain’s white matter that enables neural conduction, and astrocytes, which are the support cells of neurons and their synapses. These two kinds of glial cells that arise from human GPCs (hGPCs) are responsible for remyelination in the injured and demyelinated adult brain and spinal cord.

Diseases of glial cells are among the most prevalent and disabling conditions in neurology. These disorders include the disorders of oligodendrocyte loss and myelin failure and the disorders of astrocytes, which include a number of neurodegenerative and psychiatric disorders. What all these disorders have in common is a significant glial contribution to their pathogenesis and a lack of disease-modifying treatment options.

Congenital Leukodystrophies. A number of hereditary disorders of oligodendrocyte loss or dysfunction are characterized by a failure in myelin synthesis or structural stability. Tens of thousands of children in the United States suffer from diseases of myelin loss. The most prototypic example of this class of diseases is PMD, an X-linked leukodystrophy most often manifesting in male infants and young boys caused by mutations in the oligodendrocytic PLP1 gene, which results in widespread hypomyelination. There is no treatment for PMD, which is typically fatal in childhood. We intend to evaluate the delivery of intracerebral transplants of stem cell-derived GPCs to the brains of PMD patients, with the goal of replacing PLP1 mutant oligodendrocytes with healthy cells capable of producing normally compact myelin. Prevalence of PMD in the general population is estimated to be approximately 1 in 100,000 in the United States. Although we are initially targeting PMD as our proof of concept, we believe our stem-cell derived GPCs may have broader applicability to other congenital leukodystrophies as well, which as a group affect a more significant population of about 1 in 7,600 births.

Multiple Sclerosis (MS). MS is a debilitating disease characterized by both inflammatory myelinolysis and degenerative axonal loss. There are two major forms: the initial relapsing remitting form, known as RRMS, and its later progressive neurodegenerative phase designated secondary progressive MS (SPMS). RRMS is characterized by clearly defined attacks with new or increasing neurologic symptoms. By contrast, SPMS is characterized by progressive neurodegeneration with a loss of neurons, including those that were previously demyelinated during the RRMS phase of the disease. The demyelination occurs in a diffuse fashion throughout the adult brain and appears to reflect a loss of axonal support by local oligodendrocytes. The delivery of GPCs into such a chronically demyelinated brain may offer tangible benefits through the oligodendrocytic engagement of axons as well as by myelin repair. MS is highly prevalent, with estimates of up to 1.0 million patients in the United States, 600,000 patients in Europe, and 2.8 million patients globally. Approximately 85% of MS patients receive an initial diagnosis of RRMS, while approximately 15% of patients receive an initial diagnosis of PPMS. Up to a third of RRMS patients transition to SPMS within a decade if untreated, and most RRMS patients will progress to SPMS within 20 to 25 years of their initial diagnosis. Success with a stem cell-derived GPC product in SPMS, and especially with a hypoimmune product, could enable further expansion into the RRMS patient population.

Huntington’s Disease (HD). HD is a neurodegenerative disorder in which glial pathology appears to make a significant causal contribution. HD is an autosomal dominant disorder characterized by abnormally long CAG repeat expansions in the first exon of the huntingtin gene. The encoded polyglutamine expansions of mutant huntingtin protein disrupts its normal functions and protein-protein interactions, ultimately yielding widespread neuropathology, most rapidly evident in the neostriatum. We have found that glial pathology is a major contributor to the functional deficits of HD, and repairing the glial pathology has been shown to have significant and positive effects in animal models. In the United States, there are approximately 41,000 symptomatic HD patients and more than 200,000 at risk of inheriting HD. In Europe, there are approximately 50,000 patients with HD.

Current Treatment Landscape and Unmet Need

Congenital Leukodystrophies. There are no viable treatment options for these conditions. Patients’ only options are supportive and palliative therapies for symptoms as they present.

MS. Current treatments for MS are largely limited to treatments for RRMS. There are few approved treatments for SPMS, and none are restorative, having, at best, marginal efficacy in delaying disease progression. Currently approved treatments for RRMS may be divided into three broad categories of disease -modifying therapies: (i) first-line injectables (such as beta-interferons and Copaxone®), (ii) newer oral agents (such as Tecfidera®, Gilenya®, Mayzent®, and Zeposia®), and (iii) high-efficacy agents (such as Tysabri®, Lemtrada®, and Ocrevus®). Despite many recently successful drug launches in the RRMS space, these drugs still only slow the progression of disease and aid in the recovery from attacks, and there remains no treatment that confers functional restoration or effective cure for RRMS.

HD. There are currently no treatments that stop or reverse HD. Treatment is limited to several medications that can help minimize symptoms, including tetrabenazine, antipsychotic drugs, antidepressants, and tranquilizers.

Our GPC Program Approach

Our approach to treat myelin and neurodegenerative disorders is via the delivery of healthy allogeneic stem cell-derived GPCs to the recipient. We have developed methods for producing and isolating GPCs from PSCs and delivering them in the purity and quantities necessary for their replacement of endogenous diseased cells. We believe that our ex vivo GPC therapy has compelling potential for use in both myelin disorders and glial-based neurodegenerative conditions.

Preclinical Data

Congenital Leukodystrophies. The capacity of stem cell-derived hGPCs for remyelination has been conducted in animal models of congenital hypomyelination. Our collaborators used newborn shiverer mice that have a genetic defect in myelin basic protein (MBP), resulting in their neurons being hypomyelinated and the mice having a shortened lifespan. When iPSC-derived hGPCs were transplanted into these mice, the hGPCs spread widely throughout the brain and developed as astrocytes and oligodendrocytes. These oligodendrocytes generated mature myelin that effectively restored neuronal conductance and prolonged survival in the transplanted mice. We believe that these data, as depicted in the figures below, suggest the feasibility of iPSC-derived hGPC implantation in treating childhood disorders of myelin formation and maintenance.

hGPCs Greatly Extend the Survival of Hypomyelinated Mice

A, Dot map indicating distribution of human iPSC-derived GPCs at 7 months of age, following neonatal engraftment in a shiverer mouse brain. Widespread colonization and chimerization of the host brains by iPSC-derived hGPCs is evident (human nuclear antigen, red). B, iPSC-derived hGPC-derived myelination in shiverer forebrain, at 7 months; section 1 mm lateral to A. Myelin basic protein (MBP)-immunoreactivity (green) is all human donor-derived. C, D, Myelination in sagittal sections taken at different mediolateral levels from 2 additional 7-month-old mice, each engrafted with iPSC-derived hGPCs at birth. E, Kaplan-Meier plot of survival of iPSC-Oligodendrocyte progenitor cells implanted (n=22) vs. saline-injected (n=19) control mice. Scale: A-B, 2 mm. Adapted from Wang, Cell SC 2013.

MS. Our prior studies established the ability of stem cell-derived hGPCs to myelinate the developing shiverer brain and rescue the afflicted mice. However, the experimental subjects were neonates, not adults. Until recently, it was unclear whether GPCs can migrate extensively in adult brain tissue, as would be required for the repair of diffusely demyelinated adult brains. To explore whether the introduction of stem cell-derived hGPCs delivered directly into the adult brain could remyelinate axons in such a setting as might be encountered clinically in MS, our collaborators studied three different biologic models. First, it was shown that stem cell-derived hGPCs can disperse within and myelinate the brains of adult shiverer mice (as depicted in the figure below). Second, it was shown that neonatally-engrafted hGPCs can generate new oligodendrocytes and remyelinate demyelinated axons after chemically-induced demyelination. This result demonstrated the ability of already-resident hGPCs to remyelinate previously myelinated axons after a new demyelinating insult experienced as an adult, as well as the ability of transplanted hGPCs to reside as a functional reservoir of new myelinogenic cells in the host brains. Third, it was shown that hGPCs transplanted into the adult brain after chemically induced demyelination can remyelinate denuded axons. These data suggest that transplanted hGPCs can disperse broadly and differentiate as myelinogenic cells in the adult brain, and that they are able to remyelinate demyelinated axons and white matter lesions of the brain after an insult experienced as an adult.

hGPCs Mediate Robust Myelination After Transplantation into the Adult Shiverer Brain

Human GPCs proved both highly migratory and robustly myelinogenic after delivery to the hypomyelinated adult shiverer x rag2-/- brain (mice were injected as post-weaning adults at 4-6 weeks). A, By 19-20 weeks of age, the injected cells had dispersed broadly throughout the forebrain white matter. B, hGPCs delivered to myelin wild type rag2-/- mice distributed throughout both gray and white matter. C, Oligodendrocyte differentiation and myelinogenesis by donor hGPCs was robust, with myelination of brain regions that would typically be demyelinated in shiverer mice. D, A higher power image of C shows the high proportion of donor cells in those brain regions. Note that DAPI marks all nuclei, hN marks the hGPCs, and MBP marks the remyelinated regions in C and D. From Windrem et al, Cell Reports 2020.

HD. Our collaborators explored the cellular basis for HD-related glial pathology and identified significant defects in potassium channel and glutamate uptake mechanisms in HD glia, which appeared to account for both the glial pathology and its deleterious effects on synaptic function. Together, these studies suggest a critical role for glial pathology in the progression of HD and suggest the potential for glial cell replacement as a therapeutic strategy in HD, and more broadly, to other neurodegenerative diseases in which glial pathology might be causally contributory. It was confirmed in preclinical mouse studies that stem cell-derived hGPC transplant ameliorated both the neuronal and glial pathology of HD by restoring synaptic homeostasis and normal synaptic function to the most affected regions of the host brain.

The majority of the studies with human GPCs thus far have been xenogeneic grafts of human GPCs to neonatal or adult mice or rats (and, in a small sample proof-of-concept study limited to adult tissue-derived hGPCs, NHPs). Our collaborators have also performed studies with murine GPCs transplanted into both developing and adult mice, which have confirmed allogeneic GPC migration and integration. However, we have no assurance that human GPC engraftment of human brain will result in the widespread migration and colonization of host brain that is seen with xenogeneic grafts. To better model the human-to-human graft paradigm, our collaborators have established a new model to evaluate if GPC engraftment will result in migration and colonization in a host brain. This model allows observation of the competitive interactions of the two separately tagged human GPC populations. The human-to-human grafts expanded and integrated well in their humanized host, with competitive interactions. As might be anticipated in the clinical setting of healthy cells being transplanted for the purpose of replacing lost or diseased hGPCs, the healthy donor cells outcompete both diseased and older cells to ultimately colonize the hosts. These data have provided preclinical assurance of the fundamental premise of our approach, that healthy human donor cells can replace lost or diseased human cells in vivo. That said, this determination remains to be made in patients.

GMP Grade Stem Cell-Derived hGPCs for Clinical Studies

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