Q4 2019 Earnings Call

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Greetings and welcome to the Arcturus Therapeutics fourth quarter After school year 29, Ci earnings call.

At this time, all participants are in listen only mode.

Question and answer session will follow the formal presentation.

Anyone require operator assistance during the conference. Please press star zero on your telephone keypad.

Please note this conference is being recorded.

I'll now turn the conference over to your host made so far I said that director.

I've Investor Relations. Please go ahead.

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[noise] one moment please.

Thank you operator, and good afternoon, everyone. Thank you for joining our first as earnings conference call.

We're excited for this opportunity to discuss the company's fourth quarter and yearend 2019 operating results and certain basins development.

We are joined today by Joseph Pain, President and CEO, and Andy assessing see yourself CFO.

Dr. Apache be Colo. She is so I C. O is also on the line and they'll be available to address questions starting to Kiani station.

Joe will kick off the call with high level review Arcturus.

Next and evil discuss the fourth quarter financial results a recap certain recent developments with aimed at strengthening the company's balance sheet.

Finally, we will open to <unk> coal for the questions and answers.

Before it again I would love to remind everyone that except for statements of historical facts.

Eight minutes made by management and any responses to questions. On this conference call constitute forward looking statements that involve substantial risks and uncertainties for purposes of the safe Harbor provided by the private Securities Litigation Reform Act up 1995.

Any statements other than the statements of historical fact included in this communication, including those regarding a strategy future operations the status of preclinical and clinical development programs. The plan initiation of clinical trials the likelihood of success of the development projects programs.

The plan initiation of clinical trials, the likelihood of success off the Companys corner virus, cobot, 19 vaccine or other products and the company's current and future cash and financial position or forward looking statements.

Actual results and perform as could differ materially from deal is projected to be any forward looking statements. As a result of many factors, including without limitation on either ability to develop and market product candidates unexpected clinical results and general market conditions that may prevent such achievement or performance.

Such statements are based on management's current expectations and involve risks and uncertainties, including those discussed under the heading risk factor in our <unk> annual report on form 10-K for fiscal year ended December 31st 2018, probably the FCC on March 18 2019.

In subsequent filings with or submissions to this easy.

We intend to filed at December 31st 2019th annual report on form 10-K on Friday March 13 2020.

Except as otherwise required by law, Arcturus disclaims any intention or obligation to update or revise any for vertically statements speak only as of today. They remain whether as a result off new information future events or circumstances as otherwise.

I'll now turn to call or to Joe.

Thank you know hey, good afternoon, everyone. It's good to be with you. Thank you for joining our.

Quarterly call today, we're pleased with progress we've made during this past year and we'd like to are productive 2020.

This afternoon, we will provide an update on our flagship program a RCT 810, along with our clean a virus vaccine partnership another recent highlights.

For those of you for new to Arcturus, we are a leading messenger already medicines company focused on the discovery development and commercialization of therapeutics for rare diseases and vaccines, we utilize our enabling technologies, including our lunar and they've been mediated delivery and or so.

Ralph transcribing and replicating Hornaday Forestar technology.

We're also known for innovative manufacturing processes in messenger arent, a drug substance manufacturing and to drug product.

Manufacturing.

Arcturus pipeline of Arnie Therapeutics includes a flagship program to potentially treat born at the end Trans Carbamazepine case or Otcs deficiency also named as a RCT 10, Oh TC deficiency is a rare disease, but the most common urea cycle disorder patients who are afflicted with this disease.

These have a difficulty removing toxic waste products is proteins are digested LTC deficiency is caused by mutations in the old Tc gene, which leads to a non functional or deficient otcs enzyme.

The dysfunctionality can often cause a neurological damage in severe damage to the liver.

Hey, RCT 810 incorporates our lunar lippitt mediated delivery technology and its designed to effectively deliver OTI see messenger arnie into liver cells, and and enable ODC deficient patients to produce healthy functional otcs enzymes in their own liver cells.

Hi, intervening directly on the underlying disease process. They are C. P. 810 has the potential to be a significant new messenger RNA therapy for these patients.

Well since our last investor call. The R&D, enabling studies have been completed we successfully completed multiple GMP manufacture batches of drug substance and drug product. These batches of past release criteria and our plan to be used in our human clinical trials and we have good news to share.

Operator: ?? ?? Greetings. Welcome to the Arcturus Therapeutics 4th Quarter and Fiscal Year 2019 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. Should anyone require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Neda Safarzadeh, Director, Head of Investor Relations. Please go ahead. One moment, please.

The investigational new drug application for a RCT.

810 was filed today with the U.S.F.D.A.

Neda Safarzadeh: Thank you, operator, and good afternoon, everyone. Thank you for joining Arcturus' earnings conference call. We are excited for this opportunity to discuss the company's fourth quarter and year-end 2019 operating results and certain recent developments. We are joined today by Joseph Payne, President and CEO, and Andy Sassine, CFO.

This represents a significant milestone for the company as we transition into a clinical stage pharmaceutical company.

We have worldwide rights to MRC PHN.

We remind you that the FDA has already granted orphan drug designation for this program.

Neda Safarzadeh: Dr. Pad Chivukula, CSO and CO, is also on the line and will be available to address questions during the Q&A session. Joe will kick off the call with a high-level review of Arcturus. Next, we will discuss the fourth quarter financial results and recap certain recent developments aimed at strengthening the company's balance sheet. Finally, we will open the call for questions and answers. Before we begin, I would like to remind everyone that, except for statements of historical facts, the statements made by management and any responses to questions during this conference call constitute forward-looking statements that involve substantial risks and uncertainties for purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. Any statements other than a statement of historical facts included in this communication, including those regarding strategy, future operations, the status of preclinical and clinical development programs, the planned initiation of clinical trials, the likelihood of success of the development programs, the planned initiation of clinical trials, the likelihood of success of the company's coronavirus COVID-19 vaccine, or other products, and the company's current and future cash and financial position, are forward-looking statements

We expect to provide more details on the clinical plan, including the design of the study once the R&D has been accepted.

The FDA has recommended that we can go directly into stable patients and we are currently evaluating the merits of a study utilizing healthy volunteers as well.

Neda Safarzadeh: Actual results and performance could differ materially from those projected in any forward-looking statement as a result of many factors, including, without limitation, an inability to develop and market product candidates, unexpected clinical results, and general market conditions that may prevent such achievement or performance. Such statements are based on management's current expectations and involve risks and uncertainties, including those discussed under the heading Risk Factor in Arcturus' annual report on Form 10-K for the fiscal year ended December 31, 2018, filed with the SEC on March 18, 2019, and in subsequent filings with, or submissions to, the SEC. We intend to file the December 31, 2019 annual report on Form 10-K on Friday, March 13, 2020. Except as otherwise required by law, Arcturus disclaims any intention or obligation to update or revise any forward declared statements with speech only as of the date they were made, whether as a result of new information, future events, or circumstances, as otherwise. I will now turn the call over to Joe. Thank you, Neda. Hey, good afternoon, everyone.

In January we announced the appointment of Dr., Steve uses our Chief Development Officer, Dr. Hughes brings over 20 years of clinical development experience, including multiple successful foreign aid therapeutic approvals in rare diseases.

Joseph E. Payne: It's good to be with you. Thank you for joining our quarterly call today. We are pleased with the progress we've made during this past year, and we look forward to a productive 2020. This afternoon, we will provide an update on our flagship program, ARCT 810, along with our coronavirus vaccine partnership and other recent highlights. For those of you who are new to Arcturus, we are a leading messenger RNA medicines company focused on the discovery, development, and commercialization of therapeutics for rare diseases and vaccines. We utilize our enabling technologies, including our lunar lipid-mediated delivery system and our self-transcribing and replicating RNA, or STAR, technology. We're also known for our innovative manufacturing processes in messenger RNA drug substance manufacturing and drug products.

Joseph E. Payne: Arcturus's pipeline of RNA therapeutics includes a flagship program to potentially treat ornithine transcarbamylase deficiency, also named as ARCTA10. OTC deficiency is a rare disease, but the most common urea cycle disorder. Patients who are afflicted with this disease have difficulty removing toxic waste products as proteins are digested. OTC deficiency is caused by mutations in the OTC gene, which leads to a non-functional or deficient OTC enzyme.

He's been involved in more than 50 clinical trials throughout his career.

Dr. Hughes will provide seasoned leadership in direction to clinical operations clinical affairs clinical Sciences data management, and biometrics and drug safety is initial focus will be on air C. P 810 for OTI see deficiency as it advances into human trials.

Now moving onto an important recent development in which we announced on March 4th and this is the partnership with Duke and U.S. Medical school to develop a vaccine for Corona virus also known as co Vid 19.

Joseph E. Payne: The dysfunctionality can often cause neurological damage and severe damage to the liver. ARCT810 incorporates our lunar lipid-mediated delivery technology, and it's designed to effectively deliver OTC messenger RNA into liver cells and enable OTC deficient patients to produce healthy functional OTC enzymes in their own liver cells. By intervening directly in the underlying disease process, ARCT 810 has the potential to be a significant new messenger RNA therapy for these patients. Well, since our last investor call, the IND-enabling studies have been completed. We've successfully completed multiple GMP-manufactured batches of drug substance and drug product. These batches have passed release criteria and are planned to be used in our human clinical trials. And we have good news to share. The investigational new drug application for ARCT. 810 was filed today with the U.S. FDA. This represents a significant milestone for the company as we transition into a clinical stage pharmaceutical company. We have worldwide rights to ARCTH.

Dougan U.S. is a partnership between two world class institutions, Duke University School of Medicine, and the National University of Singapore.

The Arcturus vaccine.

That we've now name has lunar Dash C O V. One nine.

Utilizes star technology, which is an acronym for self transcribing and replicating Harney technology.

We have observed star technology in preclinical models to be effective at extraordinarily low doses greater than 34 to more efficient than conventional messenger arnie.

Arcturus manufacturing process has been applied in multiple large double digit Graham.

GMP batches of highly pure R&D in our flagship leaner old Tc program.

As we all know by now the krona virus has become a serious global health threat, and we are providing our resources and expertise in a collaborative effort to develop a co bid 19 vaccine.

This recently announced krona facts are krona virus vaccine collaboration is our fifth strategic arent a vaccine relationship as a reminder, arcturus as established relationships through sub licenses with a large pharmaceutical into animal health companies for prophylactic vaccines.

And also a collaboration with a private biotechnology company for personalized cancer vaccines.

The World Health organization has hailed Singapore as an exemplary for other countries in dealing with the kroner virus and as such the Arcturus team is honor to work with Duke and U.S. as we develop a covidien 18 vaccine and if successful could be used to vaccinate millions of people.

The vaccine development program for Krona virus utilizes arcturus is proprietary star technology platform, which combines the self replicating arnie with our lunar nanoparticle delivery system.

The concept underlying star is that the self replicating our nay when it's delivered to an individual will trigger rapid and prolonged antigen expression within host cells, resulting in protective immunity against the infectious pathogens, which is cobot 19 in this case.

Neda Safarzadeh: We remind you that the FDA has already granted orphan drug designation for this program. We expect to provide more details on the clinical plan, including the design of the study, once the IND has been accepted. The FDA has recommended that we can go directly into stable patients, and we are currently evaluating the merits of a study utilizing healthy volunteers as well. In January, we announced the appointment of Dr. Steve Hughes as our Chief Development Officer. Dr. Hughes brings over 20 years of clinical development experience, including multiple successful RNA therapeutic approvals in rare diseases.

There are multiple efforts ongoing around the world to develop vaccines against Cobot 19.

Joseph E. Payne: He has been involved in more than 50 clinical trials throughout his career. Dr. Hughes will provide leadership and direction for clinical operations, clinical affairs, clinical sciences, data management, biometrics, and drug safety. His initial focus will be on ARCT 810 for OTC deficiency as it advances into human trials. Now moving on to an important recent development which we announced on March 4th, and this is the partnership with Duke and U.S. Medical School to develop a vaccine for the coronavirus, also known as COVID-19. Duke-NUS is a partnership between two world-class institutions.

We believe arcturus potentially has an important competitive advantage by employing star technology in that due to the superior immune response and sustained protein expression that as possible with this technology, we expect to be able to produce a vaccine that will confirm protective immunity at much.

Joseph E. Payne: Duke University School of Medicine and the National University of Singapore. The Arcturus vaccine, that we now name Lunar-COV19, utilizes STAR technology, which is an acronym for Self-Transcribing and Replicating RNA technology. We have observed STAR technology and preclinical models to be effective at extraordinarily low doses, greater than 30-fold more efficient than conventional messenger RNA. The Arcturus manufacturing process has been applied to multiple, large, double-digit-gram GMP batches of highly pure RNA in our flagship Lunar OTC program.

Joseph E. Payne: As we all know by now, the coronavirus has become a serious global health threat, and we are providing our resources and expertise in a collaborative effort to develop a COVID-19 vaccine. This recently announced coronavirus vaccine collaboration is our fifth strategic RNA vaccine relationship. As a reminder, Arcturus has established relationships through sub-licenses with a large pharmaceutical company and two animal health companies for prophylactic vaccines, and also a collaboration with a private biotechnology company for personalized cancer. The World Health Organization has hailed Singapore as an exemplar for other countries in dealing with the coronavirus.

How much lower doses compared to other vaccine technologies, including conventional messenger Arnie vaccines.

Joseph E. Payne: And as such, the Arcturus team is honored to work with Duke and the U.S. as we develop a COVID-19 vaccine that, if successful, could be used to vaccinate millions of people. The Vaccine Development Program for Coronavirus utilizes Arcturus's proprietary STAR technology platform, which combines the self-replicating RNA with our lunar nanoparticle delivery system. The concept underlying STAR is that the self-replicating RNA, when delivered to an individual, will trigger rapid and prolonged antigen expression within host cells, resulting in protective immunity against the infectious pathogen, which in this case is COVID-19.

This could lead to the ability to treat many more people with a single GMP manufactured production batch, thereby greatly increasing efficiency and reducing time required to produce sufficient quantities of vaccine for large populations.

Arcturus is pleased to contribute in the global efforts to develop a covidien 19 vaccine for which there is an urgent unmet need.

I will now turn the call over to Andy who will discuss our fourth quarter full year financial results.

Thank you Joe and good afternoon, everyone.

The press release issued earlier today includes financial statements for the fourth quarter and year ended December 30, Onest 2019, which I will briefly summarize.

Our purpose is primary source of revenues is currently from license fees and collaborative payments received from research and development arrangement with pharmaceutical and biotech partners.

The fourth quarter 2019, the company reported revenues of $3 million compared to 7.6 million during the fourth quarter of 2018.

Total operating expenses for the fourth quarter 2019, with 13.8 million compared to 8.3 million for the same period of 2018.

The increase in research and development expenses were driven primarily by expenses related to our Otcs, Hi, Andy preparation and Tox studies and due to expenses associated with the launch of our New Star program.

Although we also saw increased expenses with our cystic fibrosis program.

Grant from the CF Foundation, mostly offset these expenses due to the contra expense account reporting requirement.

For more detailed please refer to our 10-K, which will be filed shortly.

General and administrative expenses in the fourth quarter of 2019 were lower by 1.6 million compared to the prior year due primarily to a onetime insurance settlement offset by higher compensation expenses.

For the fourth quarter ended December 30, Onest 2019, Arcturus reported a net loss of approximately 11 million or 76 cents per basic and diluted share compared with a net loss of 1 million or 10 cents per basic and diluted share in the prior year period.

I will now provide a summary on financial results for the year ended December 30, Onest 2019.

For the year ended December 30, Onest 2019, Arcturus reported revenues of 20.8 million compared with revenues.

15.8 million in the prior year.

Total operating expenses for the year ended December 31st 2019 were 46 point Threemillion compared with 37.6 million for the same period in 2018.

For the you ended December 31, 2019, net loss with approximately 26 million or $2.15 per basic and diluted share compared with a net loss of 21.8 million or $2.16 per basic and diluted share in the prior year.

Joseph E. Payne: There are multiple efforts ongoing around the world to develop vaccines against COVID-19. We believe Arcturus potentially has an important competitive advantage by employing STAR technology in that due to the superior immune response and sustained protein expression that is possible with this technology, we expect to be able to produce a vaccine that will confer protective immunity at much lower doses compared to other vaccine technologies, including conventional messenger RNA vaccines. This could lead to the ability to treat many more people with a single GMP-manufactured production batch, thereby greatly increasing efficiency and reducing time required to produce sufficient quantities of vaccine for large populations. Arcturus is pleased to contribute to the global efforts to develop a COVID-19 vaccine for which there is an urgent unmet need. I will now turn the call over to Andy, who will discuss our fourth quarter and full year financial results. Thank you, Joe, and good afternoon, everyone.

At December 31, 2019, Arcturus had cash and cash equivalents totaling 271.4 million compared to cash and cash equivalent of 36.7 million at December 30, Onest 2018.

Andrew H. Sassine: The press release issued earlier today includes financial statements for the fourth quarter and year-ended December 31st, 2019, which I will briefly summarize. Arcturus' primary source of revenues is currently from license fees and collaborative payments received from research and development arrangements with pharmaceutical and biotech partners. For the fourth quarter of 2019, the company reported revenues of $3 million compared to $7.6 million during the fourth quarter of 2018. Total operating expenses for the fourth quarter of 2019 were $13.8 million compared to $8.3 million for the same period of 2018. The increase in research and development expenses was driven primarily by expenses related to our OTC, IND preparation, and TOC studies and due to expenses associated with the launch of our new STAR program.

I'm happy to announce by the end of the March quarter, we will receive the first installment of $5 million from the from Singapore for all Corona virus collaboration with Duke and U.S.

Based on our current projection the company's current cash position is expected to be sufficient to support operation through the first quarter of 2021.

Joe I will now turn the call back over to you.

Thanks, Andy and in summary, the ultimate goal for all of US at Arcturus and our partners is to provide treatments for patients who are afflicted with illnesses, where there is high unmet need and no effective treatments.

Providing hope for better health is what drives us everyday as we advance the development of our innovative and novel M&A medicines.

We are enthusiastic about 2020, and we'll continue to execute upon expanding our pipeline moving our programs forward and securing additional potential partnerships.

As I said, the advancement of a RCT 810 into the clinic marks the transition of Arcturus to becoming a clinical stage company and this is something to which we're very proud.

Thank you for your time I think now is an appropriate time to pause and I'd like to open the call for for questions.

At this time, we will be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad a confirmation John will indicate your line is in the question can you May press star too if you would like to remove your question from the Q.

For those using speaker equipment and may be necessary to pick up your handset pressing the star kids.

One moment, please Bobby poll for questions.

The first question is from margin Kumar of R.W. Baird. Please go ahead.

Hey, everyone. Thanks for taking your questions. So it was our first one is noting that you said you're going to give more details about the 810 trial once the I, Indeed, claire's what isn't gonna broad strokes aspects of the design to be LTC trial, you can kind of walk through it I guess along those lines what did you learn from the previous.

Do you see deficiency traveled to that happened, let's say the road victory trials or the Ultragenyx gene therapy trial, you would that would inform your own study with a 10.

Hey, Matt do first of all thanks for calling in and asking some questions.

Yes, just to reiterate first and foremost we do expect to provide more details on the clinical plan. Once the idea has been accepted.

We do.

We have an understanding from the FDA. They recommended that we go directly into stable patients and we're currently evaluating the merits of a study utilizing healthy volunteers.

But once that R&D is accepted that will provide the right the appropriate time for us to disclose more details there pad maybe you can comment on some of the other aspects of what is asked.

Sure.

Again.

You know.

Typically hopeful at least from what we've seen in somebody other other trials.

We know that steroids are typically avoided in RCC patients. So that's a so we will be encouraging.

In closing up their use however of course.

Andrew H. Sassine: Although we also saw increased expenses with our Cystic Fibrosis Program, our grants from the CF Foundation mostly offset these expenses due to the Contra Expense Account Reporting Requirements. For more details, please refer to our 10-K, which will be filed shortly. General and administrative expenses in the fourth quarter of 2019 were lower by $1.6 million compared to the prior year, due primarily to a one-time insurance settlement offset by higher compensation expenses. For the fourth quarter ended December 31, 2019, Arcturus reported a net loss of approximately $11 million, or $0.76 per basic and diluted share, compared with a net loss of $1 million, or $0.10 per basic and diluted share in the prior year period.

This is going to be a clinical trial and finish and should be free to treat any symptoms that the patient Mandela. So and we have looked at some of the other trials the into space and.

Andrew H. Sassine: I will now provide a summary of financial results for the year ended December 31, 2019. For the year ended December 31st, 2019, Arcturus reported revenues of $20.8 million compared with revenues of $15.8 million in the prior year. Total operating expenses for the year ended December 31, 2019 were $46.3 million, compared with $37.6 million for the same period in 2018. For the year ended December 31, 2019, the net loss was approximately $26 million, or $2.15 per basic and diluted share, compared with a net loss of $21.8 million, or $2.16 per basic and diluted share in the prior year.

Andrew H. Sassine: At December 31st, 2019, Arcturus had cash and cash equivalents totaling $71.4 million compared to cash and cash equivalents of $36.7 million at December 31st, 2018. I am happy to announce that by the end of the March quarter, we will receive the first installment of $5 million from Singapore for our coronavirus collaboration with Duke and the U.S. Based on our current projections, the company's current cash position is expected to be sufficient to support operations through the first quarter of 2021. Joe, I will now turn the call back over to you. Thanks, Andy.

Again, some of the deed some of the details around the plan will be provided one sandy's excepted.

Okay, and then kind of following up from there I remembered there's also date glycogen Sundays disease.

Type three program, what's the latest study that's still planned for 2020, I Indy and they are there any updates to the cystic fibrosis program.

Good well with respect to our partner programs like Wiener GST Threed.

You know, we can definitely comment to that thats ongoing an active but because this is one that was led by our partner Ultragenyx ultimately, they're responsible for providing guidance on this and and both Pat and I look forward to getting that guidance as well.

Yeah, and again I just want to reiterate the deep the DSD program as it is ongoing political preclinical testing.

And this is led by our partner so I'm the Indian first in human will be conducted by allergenic. So I think they'll be providing more guidance and I look forward to us as well.

Great and CF.

With respect to CF, we remain on track, we didn't talk about that and you know in the call. So far but we remain on track to select the development candidate in 2020.

And we aim to have productive pre I and de meeting this year as well. So those are our or two key objectives for 2020, and Pat Yeah, and a you we will be sharing more preclinical data as well.

They don't want it at couple of different conferences as well.

Yes.

Okay, great well, thanks much guys.

Thank you.

The next question is from Whitney Ijem of Guggenheim. Please go ahead.

Hey, guys. Thanks for taking your question just to follow up Oh, T.C. I know you said you're provide more details on the study at the time of I'd, but I guess, just as you think about the healthy the healthy I guess, what would be the merits of doing that are why wouldn't you move straight into the patient just trying to understand the the pluses and minus your Wang there.

Well, that's why we're considering a study with healthy volunteers is you know the healthy volunteers are obviously quicker to recruit quicker to evaluate quicker to obtain data determining a maximum tolerated dose for example, and then we can always weve that back into the patient arm and and.

Help accelerate not only the recruitment of patients and.

And inter patient dosing dosing, we can negotiate these type of things with the FDA. It at the appropriate time. So there is certain advantages to doing it but with respect to details around or clinical plan. You know again, we look forward to sharing though is that when the ideas excepted.

Okay got it and then maybe for Singapore coded a partnership just curious kind of what are the next steps from here. What are you what work is on.

Second part of the question is because once you figure out what you need to make I guess walk us through the timelines, maybe starting to manufacture from beginning to when you have a sort of product ready to ship intact.

So this is for coat the covert 19 vaccine.

Joseph E. Payne: In summary, the ultimate goal for all of us at Arcturus and our partners is to provide treatments for patients who are afflicted with illnesses where there is high unmet need and no effective treatment. Providing hope for better health is what drives us every day as we advance the development of our innovative and novel mRNA medicine. We are enthusiastic about 2020 and will continue to execute on expanding our pipeline, moving our programs forward, and securing additional potential partnerships. As I said, the advancement of ARCT 810 into the clinic marks the transition of Arcturus to becoming a clinical stage company, and this is something of which we are very proud. Thank you for your time.

Yes.

Yeah, Okay. So I think it might be helpful just to.

To provide some additional background there. So in November we disclose the star technology via press release, there was a vetting process that on sued in involved evaluation of the Arnie or the star Rep pay our technology and combining that with the lunar delivery.

We had the opportunity to showcase it or.

Discuss and go through a vetting process at the innovative manufacturing processes and our capability scalability reproducibility for drug substance and drug product manufacturing and ultimately ended up that we were then selected as a collaboration partner.

Operator: I think now is an appropriate time to pause, and we'd like to open the call for questions. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For those using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Bye.

You know Duke in us and the Singapore governments. So we're we're in we're obviously pleased with that with respect to timing. This is a consistent question we get from the media for example, and they often ask when are we going to have this vaccine ready.

To date, we've been telling everyone as soon as possible of course.

We we are.

Very aware of the urgency to get a vaccine.

Operator: One moment, please, while we poll for questions. The first question is from Madhu Kumar of RW Baird. Please go ahead. Hey everyone, thanks for taking our questions. So I guess our first one is, noting that you said you're gonna give more details about the 810 trial once the IND clears, what are some kind of broad strokes aspects of the design of the OTC trial that you can kind of walk through? And I guess along those lines, what have you learned from the previous OTC deficiency trials that have happened, like the Revicti trials or the Ultragenyx gene therapy trials, that would inform your own study with 810? Hey Matthew,

Two people as soon as possible.

Pad to want to come yes.

And I just want say you internally, we're working around the clock that obviously the key steps that need to be need to happen first is making the messenger arnie scaling up the arnie.

We've already selected the target that were.

Going to be using for this vaccine to now we're just in the process, so scaling up and providing our partner with the drug product. So they can start some of the early validation and then we'll try to get into the end start having some conversations with the regulatory agencies, there and give us into the clinic as soon as possible.

Great. Thanks very helpful.

Joseph E. Payne: First of all, thanks for calling in and asking some questions. Yeah, just to reiterate, first and foremost, we do expect to provide more details on the clinical plan once the IND has been accepted. We do have an understanding from the FDA. They've recommended that we go directly into stable patients, and we're currently evaluating the merits of a study utilizing healthy volunteers. But, you know, once that IND is accepted, that'll provide the right, the appropriate time for us to disclose more details there. Pad, maybe you can comment on, you know, some of the other aspects of what he's asked, you know. Sure, um, again, um... Typically, at least from what we've seen in some of the other trials, we know that steroids are typically avoided in OTC patients, so we will not be encouraging their use.

The next question is from Wang see Lee Ladenburg.

Please go ahead.

Thanks, Thanks for taking my question the consolidation on the R&D buyout look forward to more detailed dr. designed to clearance, but you give some color intend to the R&D is a clear to alone where you started to reroute patient how's that going into the birds and what does seem to the room.

Before we can look like.

Or asking what interior and.

Laid on patient.

Right right was the LTC program mature and by the way when Z. Thanks for joining the call.

But.

For the question as the LTC program matures, we will be able to determine the rate of patient recruitment, we do not have that data to share at this time, but.

You know we've taken this topic very seriously and have made the necessary preparations to do what we can to accelerate this phase of the process.

Padmanabh Chivukula: However, of course, this is going to be a clinical trial, and clinicians should be free to treat any symptoms that the patient may develop. And we have looked at some of the other trials in this space, and again, some of the details around the plan will be provided once the ID is accepted. Okay, and then kind of following up from that, I remember there's also the Glycogen Synthase Disease Type 3 program. What's the latest status?

We're we also have our chief development officer that is intimately involved in and driving this process as well who is very experienced in this area. So we're glad to have the right people driving this and clearly this is going to be an ongoing question in subsequent calls as we trust.

Patient recruitment.

Yeah, and Hey, Wednesday. So this is Pat and again when talking about patient recruitment as fist, especially in this rare disease population.

Joseph E. Payne: Is that still planned for the 2020 IND? And are there any updates to the Synthetic Fibrosis Program? Well, with respect to our partner programs like Lunar GSD 3, you know, we can definitely comment that that's ongoing and active, but because this is one that was led by our partner Ultragenyx, ultimately they're responsible for providing guidance on this, and both Pat and I look forward to getting that guidance as well. Yeah, and again, I just want to reiterate that the GSD program is ongoing preclinical testing and is led by our partners. So the IND and First in Human will be conducted by Ultragenyx. So I think they'll be providing more guidance, and I look forward to this as well, and C.F. With respect to CF, we remain on track. We didn't talk about that in the call so far, but we remain on track to select a development candidate in 2020, and we aim to have a productive pre-IND meeting this year as well. So those are our two key objectives for 2020. And, Pad?

You know, we're going to envision that the lot of the you know the contracting process as well as you know talking to the academic centers as well one of the key challenges a and getting those centers on board.

All right Andy is something that's going to take some time, but but were going to try to accelerate this as fast as possible.

Once our ideas the approved.

Got it. Thank you and then gear up for the combing. The 19 boxing I think a we and then at least I think it's easier to understand that youre advantage versus introducing a message there are a neighbor vaccine.

Hi that one could you also comment on what the or the star missing already work into the advantages or maybe if you said advantage versus the DNA direction.

The company.

Yeah sure so.

All of the vaccine companies are in the business of trying to do the same thing we want to inject it we want to produce or inject an antigen to provide some sort of vaccine response right and DNA vaccines is one of the approaches Arnie vaccine doses are much lower than DNA vaccine doses.

Padmanabh Chivukula: Yeah, and we will be sharing more pre-clinical data as well later on at a couple of different conferences as well. Okay, great. Well, thanks so much, guys. Thank you. The next question is from Whitney Ijem of Guggenheim. Please go ahead.

And we found that the self replicating Arnie technology. The star technology are estimated to be even lower so that in the micrograms level not milligrams like you often see for DNA vaccines. So that is a clear differentiator and that translates of course into manufacturability and the demand to.

Joseph E. Payne: Hey guys, thanks for taking the question. Just to follow up on OTC, I know you said you'd provide more details on the study at the time of IND, but I guess just as you think about the healthy study, what would be the merit of doing that, or why wouldn't you move straight into patients, just trying to understand the pluses and minuses you're weighing there? Well, you know, why we're considering a study with healthy volunteers is, you know, healthy volunteers are obviously quicker to recruit, quicker to evaluate, quicker to obtain data, determining a maximum tolerated dose, for example. And then we can always weave that back into the patient arm and help accelerate not only the recruitment of patients and, you know, interpatient dosing, but we can negotiate these types of things with the FDA at the appropriate time. So there are certain advantages to doing it. But with respect to details around our clinical plan, you know, again, we look forward to sharing those when the IND is accepted. Okay, got it. And then maybe for the Singapore COVID partnership, just curious, kind of what are the next steps from here? What are you doing what work is ongoing now?

To make the amount of suitable now to doses to to service. The large population. So there's a significant differentiator there.

Got it.

Thanks for taking my questions.

Hey, Thanks next question is from.

Yes, I mean, where you need as Roth capital partners. Please go ahead.

Hey team congrats on Collin I mean, the number question with you across numerous topic.

Turning off one Oh Tc I'm unaware that you are not able to give a lot I learned that design insight and timeline nauman, we're stuck that however, I would love to hear huh.

I thought on you know two key endpoints are rate up your gen sets as well and plasma levels as proof of concept. So can you kinda give us a little bit color of how we can control what we should be looking for powering around those you know endpoint that who absolutely concept.

Joseph E. Payne: And then the second part of the question is, I guess, once you figure out what you need to make, can you walk us through the timelines, maybe from starting to manufacture from the beginning to when you have some sort of product ready to ship and test? So this is for the COVID-19 vaccine? Yes.

Second question for you eat what are you doing behind being qualified for the potential 8.3 billion dollar grant that the U.S. government is providing from Cornell Diary Sunday and then third question. It's related to manufacturing. We know that you are largest manufacturing batches 12, and a half ground.

Can you can you be specific which modality is that are you able to scale up purple Arctic vaccines over intercellular modality. So you could give color on that we'd be bad hop on thank you for taking our broad question.

Joseph E. Payne: Yeah, okay. So, I think it might be helpful just to, you know, provide some additional background there. So, in November, we disclosed the STAR technology via a press release. There was a vetting process that ensued and involved evaluation of the RNA or the STAR technology and combining that with the lunar delivery. You know, we had the opportunity to showcase or, you know, discuss and go through a vetting process of the innovative manufacturing processes and our capability, scalability, and reproducibility for, you know, drug substance and drug product manufacturing. And ultimately, it ended up that we were then selected as a collaboration partner by Duke NUS and the Singapore government. So, we are, and we were obviously pleased with that.

<unk>.

Sure So with respect to the first question around Biomarkers, Pat how but if you addressed that biomarkers for the Otcs of course, Yeah. You know of course you. Thanks. So the question does mean and of course, we will provide more color on all these aspects as well you know one time, these accepted but but but I sort of broad strokes, yes. Those are the key endpoints.

That will be looking gap you know the ammonia level.

As well as you know some other key biomarkers that are well understood in the space. So our initial trial.

When we entered into patient trial is gonna be stable.

Joseph E. Payne: With respect to timing, this is a consistent question we get from the media, for example, and they often ask, when are we going to have this vaccine ready? To date, we've been telling everyone as soon as possible, of course. We are very aware of the urgency to get a vaccine to people as soon as possible. Yeah, no, and I just want to say, internally, we're working around the clock to, you know, obviously, there's key steps that need to happen. First, making the messenger RNA, scaling up the RNA, we've already selected the target that we're going to be using for this vaccine, so now we're just in the process of scaling up and providing our partner with drug products so they can start some early evaluation, and then we'll try to get into and start, you know, having some conversations with the regulatory agencies there and get this into the clinic as soon as possible. Thanks for your time. Thanks for having me.

Stable patient population, so so and that's what we're going to be looking for safety. So we we can't comment a lot about you know so the movement of the Biomarkers or Oh, you know any other aspect to it to the clinical trial until.

Until have we are more clarity on what that FDA is.

Accepting.

And then I think the second question questions about 8.3 billion, yet or not.

I'll give a first crack about pad. So so I I think the everyone's closely tracking to covert 19 crisis right now.

And we know the Whr, though is issued there.

Update on on how serious it is and then the U.S. government has put forward. The 8.3 billion that you mentioned, we also are aware that 3 billion of that is dedicated to vaccine development.

We I you know there's there's several publicly traded companies that are pursuing vaccines for the covert 19 antigen right. So you have to assume that all of these companies are are looking to that.

Joseph E. Payne: Great. The next question is from Wangzi Li of Lattinburg. Please go ahead.

[noise] that that the cash that the U.S. government has put on the table to see if we can solicit some of that for our efforts a couple of comments number. One is we just went through this process with the Singapore government right.

Joseph E. Payne: Thanks. Thanks for taking my question, the calculation on the R&D file. Look forward to more details after the R&D clearance, but can you give us some color in terms of once the R&D is cleared, how long will you start to enroll patients, healthy volunteers first, and what do you think the enrollment speed would look like? For how to recruit and lay down patients.

And and we had to go through the vetting process and get the right people educated in the decision makers to deploy capital from another government entities. So we've gone through this process already.

We we look forward to going through this process with the U.S. government as well.

Joseph E. Payne: As the OTC program matures, we will be able to determine the rate of patient recruitment. We do not have that data to share at this time, but we have taken this topic very seriously and have made the necessary preparations to do what we can to accelerate this phase of the process. We also have a chief development officer that is intimately involved and driving this process as well, who's very experienced in this area. So we're glad to have the right people driving this, and clearly, this is going to be an ongoing question in subsequent calls as we track patient recruitment. Yeah. Hi Wayne. So this is Pat.

The relative size of countries is dramatically different we acknowledge that difference and we think that in that as the as as the decision makers understand.

The key issues to address these vaccines it will.

Bode well and different and benefit Arcturus and what do I mean by that.

Is the.

The.

The president issues for.

[noise] like the current challenges the current challenges for the Cobot 19 vaccines as number one the size of the dose we've already commented on that but the other day, everyone is feasibility of manufacturing and this will dovetail nicely into your third question, but the size of dose. We've commented already is micrograms, rather than milligrams or large numbers.

Micrograms, so so by limiting by addressing the size of the dose.

Joseph E. Payne: Again, when talking about patient recruitment, especially in this rare disease population, we're going to have to think a lot about the contracting process as well. Talking to academic centers is one of the key challenges, and getting those centers on board with our IND is something that's going to take some time, but we're going to try to accelerate this as fast as possible once our IND is approved. Okay. Thank you. And then, Shubhakir, for the COVID-19 vaccine, I think we understand, at least I think it's easier to understand that your advantage versus the traditional messenger RNA vaccine. But at a high level, could you also comment on what your star messenger RNA vaccine is in terms of advantage, or maybe disadvantage versus the DNA vaccine by other companies?

With star Lunar technologies are doses are much lower than other vaccines with respect to feasibility of manufacturing to date. We've showed large our name manufacturing is.

Has been completed with our lunar ODC program. This is a messenger arnie construct but it was very large and in the manufacturing of our R&D drug substance, where the the harney as a large molecule. This is something that we have significant experience and weve exemplified or manufacturing capabilities in large arnie.

In the double digit Graham.

So as soon as of the size of the manufacturing campaign and this was a single manufacturing campaign not.

Uh huh.

Several smaller batches.

And so with and then my final point I'll turn the time over to pad, but because we've addressed the size of the dose and the challenge of that with star and leaner and because we've addressed the feasibility of manufacturing of large on a both on the drug substance and the drug product and double digit Graham scales. This positions us well too.

Joseph E. Payne: Yeah, sure. All of the vaccine companies are in the business of trying to do the same thing. We want to inject it, we want to produce or inject an antigen to provide some sort of vaccine response, right? And DNA vaccines are one of the approaches. RNA vaccine doses are much lower than DNA vaccine doses, and we found that the self-replicating RNA technology, the star technology, is estimated to be even lower.

Address large populations or provide a single GMP manufacturing run that can that can be used for large amounts of people. Yeah. Thanks. So you know and again, so just make sure it's clear that our manufacturing process for for messenger Arnie that we're utilizing for Oh, the lunar otcs very very similar to what was.

Joseph E. Payne: So that is at the microgram level, not milligrams like you often see for DNA vaccines. So that is a clear differentiator. And that translates, of course, into manufacturability and the demand to make the amount, the suitable amount of doses to service a large population. So there's a significant differentiator there. Got it. Thanks for taking my questions. The next question is from Yasmeen Rahimi of Roth Capital Partners. Please go ahead.

To be applying for.

The the star platform as well so so we don't envision any challenges in terms of manufacturing.

And again now one other key point for sort of the star vaccination platform is that we envision potentially just having a single administrations, which is obviously going to be very beneficial and do some situations, yeah, and thats a differentiator as well.

Okay. Thanks.

The next question is from at Rcs H.C. Wainwright. Please go ahead.

Joseph E. Payne: Hey team, congrats on filing the IMD. We have a number of questions with you across numerous topics. Starting off on OTC, I'm aware that you are not able to give a lot of color on the design and size and timelines at this moment, and we respect that. However, I would love to hear Pat's thoughts on, you know, two key endpoints are rate of urogenesis as well as plasma ammonia levels as proof of concept. So can you kind of give us a little bit of color on how we can control, what we should be looking for, powering around those, you know, endpoints that prove proof of concept? Second question for you is, what are you doing behind the scenes to qualify for the potential $8.3 billion grant that the U.S. government is providing for coronavirus funding? And then the third question is related to manufacturing. We know that your largest manufacturing batch is 12 and a half grams. Can you be specific? Which modality is that?

Hi, gentlemen, Andy and Pat Thanks for taking my questions and congrats as well for filing the I indeed today.

On a time.

So a few questions for me I realize that you are.

Our of course waiting for acceptance on that filing from the FDA, but once you do could you perhaps discuss.

The the timeline as you see at this point in terms of starting the trial screening patients and then.

How you think about.

Either healthys or patients depending on how you decide to proceed and related to that did the agency indicate at all to you.

What was perhaps their motivation for suggesting that you start directly into stable patients as opposed to healthy is first and then I have a couple of follow ups. Thanks.

Joseph E. Payne: Are you able to scale up prophylactic vaccines over intracellular modalities? So you could give some color on that would be very helpful. And thank you for taking our broad question. Sure, so with respect to the first question around biomarkers, Pat, how about if you addressed that? Biomarkers for the OTC division.

Oh.

Go ahead again [laughter], thanks for the call Ed. Thanks. Thanks.

Again, as we mentioned you know so with we've just filed I, Andy and we're getting ready.

Well once I, India has been accepted we what we'll discuss more details around at the clinical plan as well as a provide more color on sort of timing with related to the clinical trial, but again, we're in discussions with.

Padmanabh Chivukula: Of course, yeah, you know, of course, thanks for the question, Yasmeen. And of course, we will provide more color on all these aspects once our IND is accepted. But in sort of broad strokes, yes, those are the key endpoints that we'll be looking at, you know, the ammonia level, as well as, you know, some other key biomarkers that are well understood in this space.

You know RCR all.

We're trying to talk to the clinical sites and get all those things.

Joseph E. Payne: So, our initial trial in the patient trial is going to be a stable patient population, so that's where we're going to be looking for safety. So, we can't comment a lot about, you know, the movement of the biomarkers or, you know, any other aspect of the clinical trial until, you know, until we have more clarity. And then I think the second question is about 8.3 billion. I'll give the first crack at that, Pat.

Sort of lined up in a in anticipation of that a pool, so Joe yes.

He also asked a question of why the FDA fastest and other regulatory agencies have asked us to go directly into patient site.

Theres, there's a there's a few reasons for this but we view these regulatory agencies as partners in this process. They want us these patients to gain access to safe and effective treatments as soon as possible and so the.

After the discussion they thought that the most efficient way would be to start.

Immediately into patients and we view that positively to to compress and accelerate the time through the clinic.

Joseph E. Payne: So I think everyone's closely tracking the COVID-19 crisis right now, and we know the WHO has issued its update on how serious it is, and the U.S. government has put forward the 8.3 billion that you mentioned. We are also aware that 3 billion of that is dedicated to vaccine development. There are several publicly traded companies that are pursuing vaccines for the COVID-19 antigen, right? So you have to assume that all of these companies are looking at that, and the cash that the U.S. government has put on the table to see if we can solicit some of that for our efforts. A couple of comments.

Okay. Thanks for that ER and perhaps this this also has been reviewed by.

In previous questions, but.

Given.

The current a virus vaccine or CRV 19, as you now call. It is now.

You know underway with your partner, Duke and U.S.

Is there any timeline that you could share not so much in terms of when.

People want the vaccine, but in terms of just development steps next steps and perhaps tied to that.

The 5 million dollar milestone what was that specifically for and are there any other that we could anticipate later in the year.

Joseph E. Payne: Number one is we just went through this process with the Singapore government, right? And we had to go through the vetting process and get the right people educated and the decision makers to deploy capital from another government entity. So we've gone through this process already. We look forward to going through this process with the U.S. government as well. The relative size of countries is dramatically different.

Sure so.

First of all I'd like to reference you to the 10-K that we'll be filing sometime soon.

And there the that agreement.

We will be will be included in as an appendix and that the 10-K and you can perhaps address some of your questions. There. Some comments to the first of all we are working with the Health Sciences Authority. This is the F.D. equivalent in Singapore.

Joseph E. Payne: We acknowledge that difference, and we think that as decision makers understand the key issues to address these vaccines, it'll benefit Arcturus. You know, the present issues for... The current challenges for the COVID-19 vaccines are, number one, the size of the dose. We've already commented on that, but the other one is feasibility of manufacturing, and this will dovetail nicely into your third question. The size of the dose, as we have commented already, is micrograms rather than milligrams or large numbers of micrograms. By addressing the size of the dose with star and lunar technologies, our doses are much lower than other vaccines. With respect to feasibility of manufacturing, to date, we've shown large RNA manufacturing has been completed with our lunar OTC program.

We're working also with the Duke and U.S. Medical School. These this this country. This this regulatory agency. This medical school is very well versed in unfortunately experienced with pandemic an epidemic viral outbreaks. So they've got a lot of experience with with.

These type of infectious disease diseases, and we're very fortunate to be working with them.

And with respect to timing, though what we do very well as we know how long it takes to make and manufacture a.

Hi, I'm messenger Arnie drug product. This is something we can do very well and we understand the timing of that and unfortunately that or what's what's good about this is it that's not a very long time, what is uncertain at this point and it is for all of the vaccine companies is how long would take to approve and go through the regulatory process.

Joseph E. Payne: This is a messenger RNA construct, but it was very large. And in the manufacturing of an RNA drug substance where the RNA is a large molecule, this is something that we have significant experience in. We've exemplified our manufacturing capabilities in large RNA at the double-digit gram scale. You know, in terms of the size of the manufacturing campaign, and this was a single manufacturing campaign, not, you know, several smaller batches

Yes.

Under these you know.

No serious conditions around the krona virus and how its.

It's spreading very quickly. So so we're working with both Duke in U.S. and of course, the regulatory agency in Singapore, and we hope that we'll be able to.

Accelerate and compressed timelines accordingly, so that we can get this vaccine to where it needs to be as soon as possible.

Okay Fair enough and last question for me if I may.

Joseph E. Payne: And so, and then my final point, and I'll turn the time over to Pad, but because we've addressed the size of the dose and the challenge of that with star and lunar, and because we've addressed the feasibility of manufacturing large RNA, both on the drug substance and the drug product in double-digit gram scales, this positions us well to address large populations or provide a single GMP manufacturing run that can be used for large amounts of people. Thanks, Joe. You know, and again, just make sure it's clear that our manufacturing process for messenger RNA that we're utilizing for the lunar OTC is very, very similar to what we're going to be employing for the star platform as well. So we don't anticipate any challenges in terms of manufacturing, and again, one other key point for the star vaccination platform is that we anticipate potentially just having a single administration, which is obviously going to be very beneficial in these sorts of situations. Yeah, and that's a differentiator as well.

Well actually.

Can you disclose the CRL that you're working with on your Oh Tc program.

And then separately financing question, perhaps for for Andy.

You had discussed some of the reasons why the R&D spend in the quarter was.

Significantly higher than in previous quarters, but also wondering.

If you could comment on the recent increase in the share count as well thanks again.

Yeah in terms of the CRL, we haven't disclosed that who are working with though.

Andy.

Yeah with respect to the recent I mean, our share count remained so include because of the offering we did.

Earlier, this year, where we sold 2 million shares.

That 11, 50, and we raised about $23 million. So that would have resulted in higher shared at that point in time and then we also sold shares to ultragenyx or strategic partner.

Joseph E. Payne: Okay, thanks. The next question is from Ed Arce of H.C. Wainwright. Please go ahead.

Tend to all of this year and so those were the 200.

Fundraising efforts that we did accomplish earlier this past year.

Joseph E. Payne: Hi Joe and Andy and Pat, thanks for taking my questions and congratulations as well for filing the IND today on 8-10. So, I have a few questions for you. I realize that you are, of course, waiting for acceptance of that filing from the FDA, but once you do, could you perhaps discuss the timeline as you see it at this point in terms of starting the trial, screening patients, and then how you think about either healthies or patients, depending on how you decide to proceed? And related to that, did the agency indicate at all to you what was perhaps their motivation for suggesting that you start directly into stable patients as opposed to healthy ones?

The accounted for most of the share increase hopefully that answered that question for you.

And with respect to the R&D expenses, increasing I think that's good news because that means that we are.

Obviously, initiating the CF program in ramping that up obviously OTI C.

Very critical the flagship program so.

You can intel being able to file the audience the.

On time.

The major.

Achievement for our company and certainly the first I, India ever for the company. So we're excited about that.

And of course.

Our program, which we announced in the fourth quarter also.

You know a lot of.

Expenses related to the ramp up some of the top studies.

You know formulation that we've been working on in a pet articulated earlier, we actually have you know designated.

Joseph E. Payne: Once the IND has been accepted, we'll discuss more details around the clinical plan as well as provide more color on timing related to the clinical trial. But again, we're in discussions with our CRO, and we're trying to talk to the clinical sites and get all those things sort of lined up in anticipation of that approval. So, Joe, do you have anything else to say?

Already.

A solution that we're going to be working along with the Singapore, So pretty excited about that.

Okay, great. Thanks, all for the update and congrats again on the progress.

[noise] next question is from key not kayaks charging. Please go ahead [laughter].

Thank you.

Joe Congrats.

Yeah, I would do.

Two questions for you won with respect to the upcoming person man study.

Why wouldn't you want to have some data on reason, we're equally in normal healthy volunteers just too.

Joseph E. Payne: He also asked why the FDA asked us, and other regulatory agencies have asked us to go directly into patients. There are a few reasons for this, but we view these regulatory agencies as partners in this process. They want us, these patients, to gain access to safe and effective treatments as soon as possible. And so, after the discussion, they thought that the most efficient way would be to start the patients immediately, and they reviewed that, to, you know, compress and accelerate the time through the clinic. Okay, thanks for that.

No that database of safety.

Oh, Hi, it's a fair question right now we think that all data is valuable so.

Without disclosing too much detail with respect to our our clinical plan, Yes of course, we would look at healthy.

Volunteer study in healthy volunteers is being valuable not only for the the the LTC program before platform as well.

Because our platform where.

Joseph E. Payne: And perhaps this also has been reviewed in previous questions, but, Uh, given, uh, the coronavirus vaccine, COV-19, as you now call it, uh, is now underway with your partner Duke and the U.S. Is there any timeline that you could share, not so much in terms of when people want the vaccine, but in terms of just development steps, next steps, and perhaps tied to that, the $5 million milestone, Sure. So, first of all, I'd like to refer you to the 10-K that we'll be filing sometime soon, and that agreement will be included as an appendix to the 10-K, and you can perhaps address some of your questions there. Some comments: first of all, we are working with the Health Sciences Authority. This is the FDA equivalent in Singapore.

Continuous discussions with our present partners and potentially new partners down the road and and so having this data in healthy volunteers would be valuable to support that part of the business.

Okay, Great and then second with respect to your Cobot 19 vaccine given the source of funding.

Does this in any way constrain if you are able to successfully develop a vaccine this isn't any way constrain.

Your ability to use it.

More broadly geographically.

No. We have we have complete flexibility outside of Singapore to to commercialize and manufacture the vaccine for other countries and government entities.

Joseph E. Payne: We're also working with the Duke NUS Medical School. This country, this regulatory agency, this medical school is very well-versed and unfortunately experienced with pandemic and epidemic viral outbreaks. So they've got a lot of experience with these types of infectious diseases, and we're very fortunate to be working with them. And with respect to timing, though, what we do very well is we know how long it takes to make and manufacture a messenger RNA drug product. This is something we can do very well, and we understand the timing of that. And fortunately, or what's good about this is that it's not a very long time.

Of course, we will be looking closely and many other people will be looking closely at the data we generate on this program.

And of course, and I'll, just reiterate that we're going to be looking all possible that of to doing clinical trial. So thank you.

Okay. That's all I had thanks.

Thanks Kay.

Oh.

The next question is from Yale Jen Laidlaw <unk> company. Please go ahead.

Again Oh.

Oh, sorry, Matt Congrats.

Filing.

It's just that.

Yeah. If you feel quick question first on the 810.

Would that be likely that.

No you're going to.

We feel more but would that be likely that you will have let's go to hybrid model in terms have some healthy volunteer and the quickly into a patient that potential to fulfill all multiple objectives.

You know again, we can't comment, though a lot about that but yes, I mean, we're looking at all options and you'll you'll definitely hear more color about what our strategy is going to be a very shortly.

Uh huh.

Joseph E. Payne: What is uncertain at this point, and this is for all of the vaccine companies, is how long it will take to approve and go through the regulatory process under these, you know, you know, serious conditions around the coronavirus and how it's spreading very quickly. So we're working with both Duke and the U.S. and, of course, the regulatory agency in Singapore, and we hope that we'll be able to accelerate and compress timelines accordingly so that we can get this vaccine to where it needs to be as soon as possible. Okay, fair enough. And last question for me, if I may, well, actually... Can you disclose the CRO that you're working with on your OTC program? And then separately, a financing question perhaps for Andy. You discussed some of the reasons why the R&D spend in the quarter was significantly higher than previous quarters, but I was also wondering if you could comment on the recent increase in the share count as well. Thanks again. Yeah, in terms of the CRO, we haven't discussed that, who we're working with, so, Andy?

My questions then.

Let me.

Followed the previous one which is that for modeling purposes.

Operating expenses, she will look into the third quarter at night King of the base to grow or should we look into the fourth quarter Nike number.

To grow for just one do you can do to Wendy.

Well.

But unfortunately, we don't provide guidance.

On that those matters and so.

Thank you did have to try to do the best you can with the Oracle numbers.

The assume that we're going to be into the clinic and with all of the experience that you have you certainly can you know extrapolate them, good assumptions and hopefully that come up with a reasonable forecast for the year, but unfortunately, we just do not provide the kind of.

Specific guidance.

Oh, that's fine and maybe that just last question here, which is thought to cope with Nike vaccine Oh, you mentioned earlier.

And if I did talk it.

And yet and are you going to reveal what that is and.

Would that be possible that given the R&D vaccine that you could also.

Joseph E. Payne: Yeah, with respect to the recent, I mean our share count remained increased because of the offering we did earlier this year where we sold 2 million shares at $11.50, and we raised about $23 million, so that would have resulted in higher shares at that point in time. And then we also sold shares to Ultragenyx, our strategic partner, at $10 a share, and so those were the two fundraising efforts that we accomplished earlier this past year. That accounted for most of the share increase.

You do multiple talk at all or change or whatever it. The for example mutations was set in well the virus strain going forward.

Hey, Yeah, we haven't we haven't revealed that the target is but the entire community is is working towards the very similar vaccine concept right, we just need to.

Vaccinate large groups of people with the antigen and there's not going to be significant differences between these approaches in terms of what how what that antigen is but we havent revealed the specific detail exactly what we're doing and if for whatever reason the mainstream approach. This vaccine is a challenge for all of the companies we have.

Andrew H. Sassine: Hopefully, that answered that question for you. And with respect to the R&D expenses increasing, I think that's good news because that means that we are obviously initiating the CF program and ramping that up. Obviously, OTC is very critical as a flagship program. So, as you can tell, being able to file the INC on time is a major achievement for our company and certainly the first IND ever for this company. So we're excited about that. And of course, the STAR program, which we announced in the fourth quarter, also had a lot of expenses related to the ramp-up of some of the top studies, you know, formulations that we've been working on. And as Pat articulated earlier, we actually have, you know, designated a solution that we're going to be working on with Singapore. So pretty excited about that.

Plenty of other approaches that we can also elucidate and understand in evaluating the background as a backup so we're well positioned there as well if for whatever reason the primary antigen that people are working on is a challenge Anthony you know and we're also looking actively and the space and to see if theres any mutations at all right.

And we're keeping a definitely an eye on that as well.

Yes, okay, great and Ah Okay. Thanks sale congrats on the progress.

Hey, Thank you appreciate it.

[noise] next question is from Camara Gracia of Brooklyn Capital markets. Please go ahead.

Congratulations on the iron do filing.

So you don't adopt a cystic fibrosis program.

Are you guys heard earlier talked about conducting some flattered studies that what's happening in that front.

And also lane Dom South dot uptake in the long from <unk> expectation in.

Healthy you month, what's the sophistic fibrosis patients, so well, where there's a lot of nuclear spread thing.

Joseph E. Payne: Okay, great. Thanks to all for the update and congrats again on the progress. The next question is from Kei Nakai of Chardon. Please go ahead.

And also how large is expectation in terms of translation from what you've seen the most commodity.

Hey, I appreciate the question Kumar.

Joseph E. Payne: Thank you. Joe, congratulations on following the IMD. Two questions for you. One, with respect to the upcoming First in Man study, why wouldn't you want to have some data on using your ATAN in normal healthy volunteers, just to, you know, broaden out that database of safe drugs? Oh, it's a fair question. You know, right now, we think that all data is valuable.

The data we've shown to date has been in wild type animals, and Weve shown very clear functional and delivery of messenger arent aid to bronchial epithelial cells. We've also provided some stability data of our lunar formulated Arnie CF therapeutics in.

CF patients sputum.

And that was done early in the program in order to.

Engage and hit milestones that we are dictated by the CF Foundation as prerequisites to additional funding. So we have evaluated our technology.

Joseph E. Payne: So without disclosing too much detail with respect to our clinical plan, yes, of course, we would look at a study in healthy volunteers as being valuable, not only for the OTC program but for our platform as well. As our platform, you know, we're in continuous discussions with our present partners and potentially new partners down the road, and so having this data in Healthy Volunteers would be valuable to support that part of the business. Okay, great. And then, with respect to your COVID-19 vaccine, given the source of the funding, does this in any way constrain, if you are able to successfully develop a vaccine, does this in any way constrain your ability to use it more broadly geographically? No, we have complete flexibility outside of Singapore to commercialize and manufacture the vaccine for other countries and government entities.

For stability in patient sputum, we've evaluated it has you know in in wild type animals for functional delivery.

Of messenger, our native bronchial epithelial cells, but to address the core of your question.

You know what how this will perform in.

In the human being with a different levels of and amounts and types of mucus and flemming their lungs, that's remains to be determined.

But we are we believed that our therapeutic.

As is specifically designed to to allow time for that bio distribution to occur because of the stability that I mentioned the stability data of our lunar formulated Arnie inpatient sputum and we again this is Pat and we'll be sharing more data around our preclinical plan as well as some of the translation.

No work that we're doing the at the ASG city confidence in Maine in Boston.

And then some of the key aspects the you're asking and we're hoping will you know we're collecting some a lot of that data and we and just the look out for that poster presentation that we'll be doing that meeting.

Joseph E. Payne: Of course, we will be looking closely, and many other people will be looking closely at the data we generate through this program. And, of course, I'll just reiterate that we're going to be looking at all possible paths to doing clinical trials. Okay, that's all I had. Thanks, Kay. Keep it up.

And also it's off a daily what do you guys how already defined bounce off the wall at long last minute ophthalmology looks like for core we do need to target. The Muslim ward. There. How do you have income sounds like you know daily living to the Muslim.

Yeah, we showed at at a recent conference we had the opportunity to present.

Joseph E. Payne: The next question is from Yael Jen of Laidlaw & Company. Please go ahead. Again, I also want to add my congratulations for your ID filing. A few short, quick questions. First on the A10.

Some.

Protein data, where we showed that our star technology showed a 30 fold.

Improvement or higher protein production relative to conventional messenger Arnie and this was a direct control to experiment and we presented that recently anything else to no and again just if this is gonna be obviously, a local therapeutics you know a injection directly into the <unk> intramuscular side. So it I mean, so the challenges.

Joseph E. Payne: Would that be likely that, I know you're going to reveal more, but would that be likely that you will have a sort of hybrid model in terms of having some healthy volunteers and quickly turning them into a patient that potentially fulfills multiple objectives? You know, again, we can't comment a lot about that, but yes, I mean, we're looking at all options, and you'll definitely hear more color about what our strategy is going to be very shortly. My second question is a little bit of housekeeping that follows the previous one, which is that for monitoring purposes for the operating expense, should we look into the third quarter 19 number as a base to grow, or should we look into the fourth quarter 19 number as a base to grow for 2020?

You know I'm not as high as Ah So somebody other delivery routes to we've worked on yeah.

Yeah, where we differentiate again is our Luna every technology, which is it tends to be more bio degradable and and also our star technology, which.

Allows us to dose at a much lower dose.

I mean, Dom south debris I.N.B. meeting with the F b or maybe you can share some thoughts there like you know what expectation from there.

For a pre I'd meeting you may now for the CF program or I guess, what to see a lot and timing.

Oh, yeah for the CF program, the timing of that yet again, where.

Andrew H. Sassine: Unfortunately, we don't provide guidance on those matters, and so I think you just have to try to do the best you can with the historical numbers and assume that we're going to be into the clinic. And with all of the experience that you have, you certainly can extrapolate some good assumptions and hopefully come up with a reasonable forecast for the year. But unfortunately, we just do not provide those kinds of specific guidance. So that's fine. And maybe that's the last question here, which is about the COVID-19 vaccine. You mentioned earlier that you have already identified the target. Are you going to reveal what that is? And would it be possible that given this is an RNA vaccine, you could also potentially do multiple targets or change or whatever if the, for example, mutation set in for the virus strains going forward? Hey Yale,

As I mentioned, the where we're collecting some preclinical data. We'll we'll have we'll ship will set a lot of that did a in it you know probably in the first half of this year and then we.

Anticipate a you know having discussions with regulatory agencies. The in the second half and once we have that that will provide more color.

Okay, great. Thank you so much.

Sure.

This concludes the question and answer session I will now turn the call over to Genesis teams for closing remarks.

Hey, just thank you everyone for listening in we appreciate the time you know at this point, we're just going to close the call, but please feel free to reach out with any follow up questions. We'll we'll try to address them shortly and thanks again bye for now.

This concludes today's conference and you may disconnect. Your lines at this time. Thank you for your participation.

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Joseph E. Payne: We haven't revealed what the target is, but the entire community is working towards a very similar vaccine concept, right? We just need to vaccinate large groups of people with the antigen, and there will not be significant differences between these approaches in terms of what that antigen is. But we haven't revealed the specific details of exactly what we're doing. And if, for whatever reason, the mainstream approach to this vaccine is a challenge for all of the companies, we have plenty of other approaches that we can also elucidate and understand and evaluate in the background as a backup. So we're well positioned there as well, if for whatever reason the primary antigen that people are working on is a challenge. And we're also looking actively at the space and to see if there are any mutations that arise, and we're definitely keeping an eye on that as well.

Joseph E. Payne: Okay, great. And again, thanks and congratulations on the program. Hey, thank you, I appreciate it. The next question is from Kamar Raja of Brookline Capital Markets. Please go ahead.

Joseph E. Payne: Congratulations on the IND filing. So, in terms of the Cystic Fibrosis Program, you guys had earlier talked about conducting some ferret studies, what's happening in that front and also in terms of the uptake in the lungs, what the expectation is in healthy humans versus cystic fibrosis patients where there's a lot of mucus present, and also what is the expectation in terms of translation from what you see in the Hey, I appreciate the question, Kumar.

Joseph E. Payne: The data we've shown to date has been in wild-type animals, and we've shown very clear functional and delivery of messenger RNA to bronchial epithelial cells. We've also provided some stability data of our lunar-formulated RNA-CF therapeutics in CF patient sputum, and that was done early in the program in order to engage and hit milestones that were dictated by the CF Foundation as prerequisites to additional funding So we have evaluated our technology for stability in patient sputum. And we've evaluated it, as you know, in wild-type animals for functional delivery of messenger RNA to bronchial epithelial cells. But to address the core of your question, you know, how this will perform in, you know, a human being with different levels and amounts and types of mucus and phlegm in their lungs, that remains to be determined.

Joseph E. Payne: But we are, we believe that our therapeutic is specifically designed to allow time for that biodistribution to occur because of the stability that I mentioned, the stability data of our lunar-formulated RNA in patient sputum. And, again, this is Pad, and we'll be sharing more data around our preclinical plan as well as some of the translational work that we're doing at the ASGCT conference in Maine, in Boston, and some of the key aspects that you're asking, and we're collecting a lot of that data, and just look out for that poster or the presentation that we'll be doing at that meeting, and also in terms of delivery you guys have already data in terms of liver lung as well as ophthalmology looks like for covid you need to target the muscle what data do you have in terms of like you know delivery into the muscle, Yeah, we showed at a recent conference, we had the opportunity to present some protein data where we showed that our STAR technology showed a 30-fold.., improvement or higher protein production relative to conventional messenger RNA and this is a direct controlled experiment and we presented that recently. Anything else to add? No, and again, this is going to be obviously a local therapeutics, you know, injection directly into the intramuscular site so, I mean, so the challenges are, you know, not as high as some of the other delivery routes that we've worked on.

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Joseph E. Payne: Yeah, where we differentiate again is our lunar delivery technology, which tends to be more biodegradable, and also our STAR technology, which allows us to dose at a much lower dose. And in terms of the pre-IND meeting with the FDA, maybe you can share some thoughts, like, you know, what's expected from there. For a pre-ID meeting, do you mean for the CF program, or...? Ah, yes, for the CF program. For the CF program, the timing of that, again, as I mentioned, we're collecting some preclinical data. We'll share a lot of that data probably in the first half of this year, and then we anticipate having discussions with the regulatory agencies in the second half.

Joseph E. Payne: And once we have that data, we'll provide more calls. Okay, great. Thank you so much. This concludes the question and answer session. I will now turn the call over to Joseph Payne for closing remarks. Just thank you everyone for listening in. We appreciate the time. At this point, we're just going to close the call, but please feel free to reach out with any follow-up questions. We'll try to address them shortly. And thanks again. Bye for now. This concludes today's conference and you may disconnect your lines at this time. Thank you for your participation. ?? ?? © BF-WATCH TV 2021 [inaudible] Thanks for watching! ???? © BF-WATCH TV 2021 ?? ?? ?? © BF-WATCH TV 2021 ?? ?? ?? ?? ?? ??? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ??? ??? ??? ??? ??? ??? ??? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? , , , , , , , , , , , , , , [inaudible] © BF-WATCH TV 2021, ?? ?? ?? ?? ?? ?? ??

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