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Will AVRO Reverse Course In Run-up To February Event?

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Shares of AVROBIO Inc. (AVRO) have lost 39% of their value over the last 1 month in sharp contrast to the iShares Nasdaq Biotechnology ETF (IBB) index which has gained 8% during the same period.

AVROBIO is a clinical-stage gene therapy company developing gene therapies to potentially cure rare diseases like Fabry disease, Gaucher disease, Cystinosis, and Pompe disease.

The Company's lead drug candidate is AVR-RD-01, an ex vivo lentiviral gene therapy being investigated as single-dose therapy for Fabry disease.

Fabry disease is an inherited disorder that results from the buildup of a particular type of fat, called globotriaosylceramide, in the body's cells due to deficiency of the enzyme, alpha-galactosidase A (AGA). This rare disorder is characterized by episodes of pain, particularly in the hands and feet (acroparesthesias); clusters of small, dark red spots on the skin called angiokeratomas; a decreased ability to sweat (hypohidrosis); cloudiness of the front part of the eye (corneal opacity); problems with the gastrointestinal system; ringing in the ears (tinnitus); and hearing loss. (Source: Genetics Home Reference).

Fabrazyme, an Enzyme Replacement Therapy (ERT), developed by Sanofi (SNY), and Galafold, an oral chaperone therapy, developed by Amicus Therapeutics Inc. (FOLD), are the approved treatments for Fabry disease in the U.S.

AVR-RD-01 is under an investigator-sponsored phase I study in up to six patients with Fabry disease who have been treated with standard of care enzyme replacement therapy (ERT) for at least six months prior to receiving AVR-RD-01, and AVROBIO-sponsored phase II trial in eight to twelve treatment-naïve patients.

Last October, the Company reported encouraging data from the investigator-sponsored phase I study and the AVROBIO-sponsored phase II trial of AVR-RD-01 in Fabry disease.

The Company observed encouraging AGA enzyme activity after treatment with AVR-RD-01 in the first two patients with Fabry disease in the phase I study. All patients will continue to be followed for the assessment of long-term durable response. Since mid-July 2018, patient 1 in the phase I study is no longer receiving enzyme replacement therapy.

Data reported from the AVROBIO-sponsored phase II trial of AVR-RD-01 in Fabry disease, dubbed FAB-201, was from the first patient who had enrolled in the trial. After three months of treatment with AVR-RD-01, this patient also had AGA plasma enzyme activity above the diagnostic range of classic Fabry disease.

Enrollment in both the FAB-201 clinical trial and investigator-sponsored phase I study of AVR-RD-01 in Fabry disease continues, and an update on the trials is scheduled to be presented at WORLDSymposium on February 5, and February 6, respectively.

Next in the pipeline is AVR-RD-02, a gene therapy for Gaucher disease.

Gaucher disease (pronounced "go-SHAY") is an inherited genetic disorder, in which patients lack the normal form of glucocerebrosidase or GCD enzyme that breaks down specific fat molecules. The lack of this enzyme results in the accumulation of fat in the liver, spleen and bone marrow. The disease affects about 1 in 100,000 persons in the general population. According to the National Gaucher Foundation, 2,500 Americans suffer from Gaucher disease.

Enzyme replacement therapies like Sanofi's Cerezyme, Shire's Vpriv and Pfizer's Elelyso, and oral drugs like Sanofi's Cerdelga and Actelion's Zavesca are some of the approved treatments for Gaucher disease. A generic version of Zavesca, developed by Amerigen and Dipharma, was approved by the FDA last April.

AVROBIO's phase I/II clinical trial of AVR-RD-02 in patients with Type 1 Gaucher disease is expected to be initiated this year.

The other investigational gene therapy programs of AVROBIO are AVR-RD-04, which was recently cleared to advance into phase I/II trial for cystinosis, and AVR-RD-03, a gene therapy candidate being investigated for Pompe disease currently in early preclinical development.

Cystinosis is an ultra-rare lysosomal storage disease, and it primarily affects the kidneys and eyes. Horizon Pharma plc's (HZNP) Procysbi is an FDA-approved drug for cystinosis.

Pompe disease is an inherited Lysosomal Storage Disorder (LSD) caused by a deficiency of the enzyme acid alpha-glucosidase. This disease is characterized by progressive muscle weakness in people of all ages. Sanofi's enzyme replacement therapies namely Myozyme and Lumizyme are the current treatment options for Pompe disease.

Q3 Scorecard:

On November 13, 2018, the Company reported financial results for the third quarter ended September 30, 2018.

Net loss for the recent third quarter was $11.59 million or $0.49 per share compared to a net loss of $6.44 million or $2.85 per share in the year-ago quarter. No revenue has been generated so far.

AVROBIO ended Q3, 2018 with cash of $138.6 million, which is expected to be sufficient to fund its operating expenses and capital expenditure requirements into 2020.

IPO & Stock Quote:

AVROBIO's common stock made its debut on the Nasdaq Global Select Market on June 21, 2018, at a public offering price of $19.00 per share. The stock has thus far hit a low of $12.30 and a high of $53.70.

AVRO closed Friday's (Jan.18, 2019) trading at $13.36, up 5.86%.

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