Q1 2020 Earnings Call

At this time all participants are in listen only mode. Following the formal remarks, well open the cat that calls for your question. Please be advised said this call is being recorded at the company's request at this time I'll like to turn it over to Jessica Schoen they'll develop please proceed.

Operator: Participants are in a listen-only mode. Following the formal remarks, we will open the call to your questions. Please be advised that this call is being recorded at the company's request. At this time, I would like to turn it over to Jessica Cutrone of Evelo. Please proceed. Thank you, Carmen. Good morning, everyone. This morning we issued a press release that outlines the topics we plan to discuss today. This release is available at www.evelobios.com under the investors tab. Today on our call is Sipa Gill, Chief Executive Officer.

Thank you Carmen good morning, everyone. This morning, we issued a press release outlines the topics we plan to discuss today, it's releases available at Www Dot Abella Bio's dotcom under the Investor cap today her calls that Mcgill Chief Executive Officer, Mark Saad Murray President of R&D in Chief Scientific Officer, It does get Mikael cheap medal.

Jessica Cutrone: and Duncan McHale, Chief Medical Officer, will review our first quarter 2020 financial results and recent business highlights. Before we begin, I'd like to remind everyone that statements made during this conference call that do not relate to matters of historical fact, including statements about our objectives and anticipated clinical milestones for 2020, the impact of any of our monoclonal microbials, the timing and results of any clinical studies, and the sufficiency of cash to fund operations should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are intended to be subject to the safe harbor protection provided by the Reform Act. Actual results could differ materially from those indicated by these forward-looking statements due to the impact of many factors.

Gloucester overview, our first quarter 2020 financial results and recent business highlights before we begin I'd like to remind everyone that statements made during this conference call that you're not really matters of historical facts, including statements about our objective anticipated clinical milestones for 2020 impacted any of our microphone on microbial.

And the timing and results of any clinical studies and the sufficiency of cash to fund operations should be considered forward looking statements within the meaning of the private Securities Litigation Reform Act is 1995, such forward looking statements are intended to be subject to the safe Harbor protection provided by the reform.

Actual results could differ materially from those indicated by the forward looking statements due to the impact as many factors participants are directed to the risks factors set forth in a Dallas quarterly report on form 10-Q for the quarter ended March 31st 2020, and the company's other filings with the Securities and Exchange Commission any forward looking statements.

Jessica Cutrone: Participants are directed to the risk factors set forth in Avelo's quarterly report on Form 10-Q for the quarter ended March 31, 2020, and the company's other filings with the Securities and Exchange Commission. Any forward-looking statements made today speak only to Avelo's operations as of today. Avelo disclaims any duty to provide updates to its forward-looking statements, even if subsequent events cause the company's views to change. It's now my pleasure to pass the call over to Simba.

Makes a big only two abeles operations as of today.

Disclaims any duty to provide updates to its forward looking statements even if the subsequent to that caused the companies seem to change. It's now my pleasure to pass the call a pretty soon enough.

Simba Gill: Thank you, Jessica, and good morning, everyone. Thank you for joining us to review our progress in the first quarter. I'm pleased to report today that we have additional clinical data that supports the potential of EDP 1815 as an effective anti-inflammatory drug. We also have encouraging initial evidence in triple negative breast cancer with EDP 1503. Importantly, we announced last week the submission of an IND for a Phase 2 study of EDP1815 for the treatment of COVID-19. By intervening early in the disease, we may be able to prevent progression of COVID-19. We expect to report data from this study in the second half of this year.

Thank you Jessica and good morning, everyone. Thank you for joining us.

Review progress from first quarter.

I'm pleased to report today that we have additional clinical data that supports the potential.

Oh GDP 18th 15.

As an attractive anti inflammatory croak.

We also have encouraging initial evidence in triple negative breast cancer with GDP 15 has decreased.

Importantly, we announced last week the submission open I am doing for phase two study.

E D. P 18, Christine the treatment of Cobot 19.

And by intervening early in the disease.

We maybe able to prevent progression of kopec my teeth.

We expect to report data from this study and the second half of this year.

We have responded to the coke at 19 pandemic by accelerating she plans for clinical development and for scale up on manufacturing of EDI P 18 50.

Simba Gill: We've responded to the COVID-19 pandemic by accelerating key plans for clinical development and for scale-up and manufacturing of EDP1815. If we see positive data, we aim to be in a position to supply product for millions of patients by early 2021 and to scale from there onwards. We have also continued to generate new clinical data which informs our understanding of the activity in humans of different formulations of our product. We have now observed...

If we see positive data, we aim to be in a position to supply product for millions of patients by early 2021 at this scale from that on which.

We've also continued to generate new clinical data, which informs our understanding of the activity in humans, that's different formulations of all products.

Well now observed.

Simba Gill: Positive Effects with the Enteric Formulation of EDP1815 in 3 Separate Human Clinical Studies; we did not see meaningful clinical responses with a newer alternate formulation in either atopic dermatitis or psoriasis. Based on these results, we're advancing into our Phase 2 dose-ranging study in psoriasis with the enteric capsule formulator. Mark will expand on the relevant results. We also continue to advance EDP 1867 into clinical development and to explore the potential of our platform in areas including neuroinflammation and metabolism. 2020 will continue to be a year filled with clinical data, and I will review the revised and expanded clinical milestones later in the call. Let me now turn the call over to Mark to tell you about new results with EDP1850.

Effects with the enteric formulation.

Pete 18, 15 into three separate human clinical studies.

We did not see meaningful clinical responses with anew ultimate formulation in either a topic dermatitis all psoriasis.

Based on these results, we advancing into a phase two dose ranging study in psoriasis, we see it hurt capsule formulation.

Mark will expand on the relevant results.

We also continue to advance CDP 18 67.

Into clinical development and to explore the potential of a platform in areas, including your information and been tablets.

Twentytwenty will continue to be a U.S. filled with clinical data and I will review, our revised and expanded clinical milestones later in the coal.

Let me now turn the call of its Mark I tell you about the results with GDP Eighteenfifty.

Thank you said that.

Mark: Thank you, Simba. During the past quarter, we've learned a lot about the clinical pharmacology of EDP-1815. This comes from new results from two clinical studies. First, an immunopharmacology study with the enteric capsule formulation. And second, interim data with the ultimate formulation of EDP-1815 from the Phase 1b study. I'll start with immunopharmacology.

During the past quarter, we've learned a lot about the clinical pharmacology of BDC facing so Steve.

This comes from new results to clinical studies first.

Pharmacology studies will be it's her capsule formulation.

Second incident data with the ultimate formulation, the BDC 18 Christine.

Phase one be study.

I'll start with immuno pharmacology.

Mark: The study tested the ability of EDP1815 to reduce an antigen-specific inflammatory response. It's similar to the delayed-type hypersensitivity studies we use preclinically as a standard measure of efficacy. It's the most direct test of whether the striking effects of the small intestinal axis mechanism in preclinical models translate to humans using objective, quantitative, and blinded empathy. 20 healthy volunteers were dosed for 28 days with either EDP-1815 in the enteric capsule formulation or placebo. They were immunized with an antigen, keyhole lymphedema cyanin, or KLH, on day 3 of dosing. An inflammatory reaction was then induced by a second injection of KLH in the arm on day 27. Inflammation was measured using a technique called laser speckle contrast imaging.

This study tested the ability of EDI, CHF 15, fruit juice or pathogen specific inflammatory response.

Similar to the delays what type of sensitivity studies, we use preclinically was founded measure of efficacy.

It's the most direct test or whether the striking effects. It's a small intestinal axis mechanisms in preclinical models translates to humans using an objective quantitative blinded pinpoint.

Pretty healthy volunteers were close to 48 days.

<unk> 18, 15 minutes her capsule formulation or placebo.

Every immunized with an African keyhole, because he decided okay l. age on day three of dosing.

It's one of <unk> reaction was that a juice my second objection upscale age in the home on day 27.

Information was measured using a technique called Lisa Speckle contrast, imaging, especially as the skin blood flow to slice of the reaction.

Mark: This measures the skin blood flow at the site of the reaction, a key feature of inflammation. Readings were compared immediately before the second injection and again after 24 hours. Treatment with EDP-1815 resulted in a 15-fold lower blood flow in the inflamed skin than placebo, a reduction in the inflammatory response of over 90%. This is clear-cut clinical proof of mechanism using objective and quantitative end-of-life analysis. This shows that the small intestinal axis functions in humans and can be used to modulate systemic inflammation. This is consistent with preclinical data and with the data we released last year from two cohorts of individuals with mild to moderate psoriasis, which demonstrated a reduction in both PASI and lesion severity scores. As Simba mentioned, we're also announcing interim data from the Phase 1b trial cohorts of psoriasis and atopic dermatitis individuals treated with the alternate formulation of EDP1815. We did not see clinical effects in either cohort.

Feature of inflammation.

We didn't recur pets immediately before the second injection and again after 24 hours.

Okay, well DDP 18, 15 resulted in a 15 fold lower blood flow was inflated skin in the placebo reduction in inflammatory this falls over 90%.

This is clear cut clinical proof of mechanism using an objective uncomplicated endpoint.

It shows that the small intestinal access functions in humans I couldn't be choose to manipulate systemic inflammation.

This is consistent with preclinical data I would have taken we released last year from two cohorts with individuals with mild to moderate psoriasis.

The straight to the reduction in both pozzi allusions to those schools.

Superman should were also announcing interim data from the phase one be trial cohorts of slices and they told US dermatitis individuals basically the alternate formulation of GBP 18 Christine.

We did not see clinical effect in light of cohort.

Mark: We believe this has to do with the different way in which the drug is released in the two formulations. The enteric capsule releases a bolus of EDP-1815 when it disintegrates in the small intestine, leading to a high concentration of drugs. The alternate formulation transitions gradually from the stomach to the small intestine, and so it does not reproduce the bolus release and high drug concentration. This can be reconciled with the preclinical results, dose response being more dependent on the maximum concentration of drug than the total exposure over time, a recognized aspect of the pharmacology of some drugs.

We believe this has to do it's a different way in which the drug is released to the two formulations. It's her capsule releases a bolus of GBP 18, 15 capsule disintegrates in the small impressive leading to a high concentration of drugs.

The alternate formulation transitions gradually from the stomach for the small intestine. So it does not reproducible this release and high drug concentration.

Can be reconciled with the preclinical results. There was response the more dependent on the maximum concentration of drugs.

Total exposure over time I recognize aspect of the pharmacology of some drugs.

Mark: In summary, we now have three separate clinical cohorts showing efficacy of the enteric capsule formulation of EDP1815 in a practical dose range, two in psoriasis previously reported and the immunopharmacology study reported today. Together, the clinical data with EDP1815, significantly reinforced by the human immunopharmacology results, are evidence for the potential of EDP1815 for the treatment of inflammatory diseases. The future studies you'll hear about from Duncan will be done with the Enteric Capsule Formulation. Before handing over to Duncan, I'd like to tell you about the scientific rationale for taking EDP-1815 into the COVID-19 trial for which we announced the IND submission last Thursday. As I'm sure you're aware, emerging data on COVID-19 suggests that life-threatening complications are associated with hyperinflammation and cytokine storm, which lead to multiple organ failure and can be fatal.

In summary, we now have three separate clinical cohorts geographic seem to be into her capsule formulation VBT 18, Christine in a practical dose range, which lies as previously reported.

Even though pharmacology studies reporting today.

Together, the clinical data with GDP 18, 15 significantly reinforced by the human immuno pharmacology results.

Evidence for the potential of GBP 18, 15 for the treatment of inflammatory diseases.

Future studies, you'll hear about Duncan will be done with interest capsule formulation.

Before handing over to talk a I'd like to tell you about the seismic rush at all and taking eat the 18th 15 into the Coca 19 trial, which we announced the high a de submission last Thursday.

I'm sure you're aware emerging based on corporate biting suggest life threatening complications are associated with type of inflammation cytokine storm, which lead to multiple organ failure and can be faisal.

Mark: Preclinically, EDP1815 has been observed to induce broad resolution of inflammation with effects on multiple inflammatory mechanisms. It modulates Th1, Th2, and Th17 pathways, down-regulating cytokines including TNF, IL-456, IL-12, IL-13, and IL-17. Several of these have been implicated in the cytokine storm associated with severe complications of COVID-19. And, of course, earlier in the quarter, we announced clinical biomarker data from the Phase 1b psoriasis study showing reductions in multiple systemic mediators of inflammation, including IL-6, IL-8, TNF, and IL-1b. These effects are achieved with a convenient oral product that has had placebo-like safety and tolerability in all studies to date. This profile suggests the potential for EDP1815 as a treatment for COVID-19, as well as a range of viral-induced inflammatory conditions, including complications of the flu.

Pre clinically GDP eighteenfifty this be been observed through juice broad resolution of information with effect from multiple inflammatory mechanisms that motivates T.H., one teach too and th 17 pathways down regulating slight declines, including Cnf I, all 456, I all 12, while focusing on I'll 17.

Several of these been implicated in the cytokine storm associated with severe complications of covert 19th.

Of course over the course of we announced clinical biomarker data.

Phase won't be slices studies.

Reductions in multiple studies mediated inflammation, including.

Oh, six Ireland, Canada, no I wouldn't be tough.

These effects were achieved with a convenient oral product.

Steve I like safety and Tolerability pivotal studies to date.

Profile suggest the potential GBP 18, 15, as a treatment for coated my team as well as a range of viral intrusive monetary conditions, including complications of Lou.

Duncan McHale: And with that, let me hand it over to you.

With that let me hand, it over to Duncan.

Thank you Mark and good morning, everyone.

Duncan McHale: Thank you, Mark, and good morning, everyone. I'm pleased to provide an update on the next steps for our inflammation and oncology program. I want to start with the potential we see for EDP1815 in the treatment of COVID-19. As we announced last week, we are honoured to partner with Rutgers University and the Robert Wood Johnson University Hospital to evaluate EDP1815 in a Phase 2 study for the treatment of COVID-19. The study will be led by Dr. Ray Panettiere, one of the world's leaders in respiratory disease.

I'm pleased to provide an update on the next steps for information and oncology program.

I want to stop with the potential we see the ATP eighteenfifty in the treatment of covered 19.

As we announced last week, we wanted to partner with Rutgers University and the Robert Wood Johnson University Hospital to evaluate ATP 18, 15 in a phase two study for the treatment of Cobot 19.

The study will be led by Dr. Ray penalty every one of the world leaders in respiratory disease.

Duncan McHale: The decision to test the potential of UDP1815 to prevent the life-threatening complications associated with the hyperinflammation and cytokine storm in COVID-19 is based on preclinical and clinical data showing its ability to modulate multiple key cytokines, as Mark has described. The COVID-19 study is a Phase 2, double-blind, placebo-controlled clinical trial that will assess the potential of EDP1815 in the treatment of hospital The study will initially enroll 60 individuals to determine if early intervention with EDP1815 can prevent or reduce the deterioration of lung function that is associated with the progression of COVID-19 symptoms and the development of COVID-related complications. Individuals will be treated with EDP1815 or placebo on top of standard of care for 14 days. The primary endpoint of the study is the reduced requirement for oxygen therapy.

The decision to test potentially VTB 18, 15 to prevent the life threatening complications associated with the hype inflammation and cytokine storm and can be 19 is based on preclinical and clinical data showing its ability to much like multiple key cytokine as Mark has described.

The carpet 19 study the phase two double blind placebo controlled clinical trial that will assess the potentially BDP 18, 15 in the treatment of hospitalized patients with newly diagnosed covered 19.

The study will initially in rose 60 individuals to determine if early intervention with GDP 18, 15 can prevent or reduce the deterioration of lung function that is associated with the progression of cobot 19 symptoms and the development of coverage related complications.

Individuals will be treated with DT pay 10, 15 or placebo on top of standard of care for 14 days.

The primary endpoint in the study is the reduced requirement for oxygen therapy.

Duncan McHale: Key secondary endpoints include total symptom duration, progression along the WHO scale of disease severity, and mortality. Now, in parallel with the COVID-19 study, we continue the setup for the Phase 2 dose-ranging trial of EDP1815 in patients with mild to moderate psoriasis. The design of the study is unchanged, apart from a small increase in sample size, which we have implemented in order to increase our power to tell each dose level apart from placebo and to provide some buffer for a higher than expected dropout rate due to coronavirus infection. Sembo will discuss the impact of COVID-19 on timelines later in the call.

Key secondary endpoints include total symptom duration progression along with somebody they chose scale of disease severity and mortality.

In parallel with the kind of 19 study we continue to set up for the phase two dose ranging trial to be 18 15 in patients with mild to moderate psoriasis.

The design of the study is unchanged apart from a small increase in sample size, which we have implemented in order to increase our power to tell each dose level of pop from placebo and to provide some buffer for a higher than expected dropout rate huge corona virus infections.

Sandal will discuss the impact of covered 19 on timelines later in the cool.

Moving to our oncology studies.

Simba Gill: Moving to our oncology study, as Simba mentioned at the beginning of the call, we have seen encouraging initial evidence to support the use of EDP-1503 as a potential treatment for triple negative breast cancer. Because of this, we've decided to prioritize the development of EDP1503 in this tumor. As a reminder, this study is a Phase I-II open-label single-arm study designed to evaluate the effects of EDP-1503 in combination with Keytruda in a range of tumor types, metastatic microsatellite stable colorectal cancer, triple negative breast cancer, and PD-1, PD-L1 re Initial analysis of the clinical data showed no remarkable safety signals, and the futility hurdle for triple negative breast cancer was successfully passed. With the new focus on triple negative breast cancer, we are halting recruitment in the other arms of the study but will follow all currently recruited subjects who are still in the study. Let me now turn the call back over to Simba.

Simply mentioned at the beginning of the call. We've seen encouraging initial evidence to support these VTP fifteenthree as a potential treatment the triple negative breast cancer.

Because of this we've decided to prioritize the development of PDP 15, or three in this tumor type.

As a reminder, this study is a phase one to open label single arm study designed to evaluate the effects of GDP Fifteenthree niccum in combination with Keytruda in a range of tumor types.

Metastatic microsatellite stable colorectal cancer.

The negative breast cancer and PD, one PDL, one relapsed solid tumors.

Initially analysis of the clinical data showed no remarkable safety signals and the futility hurdle for triple negative breast cancer, we successfully passed.

With the new focus on triple negative breast cancer, we're halting recruitment in the other arms of the study, but we'll follow all currently recruiting subjects were still in the study.

Let me now turn the call back over December.

Thanks Duncan.

Operator: Thanks, Duncan. I wanted to conclude with revised milestone guidance given the initiation of our phase two trial in COVID-19 and the ongoing COVID-19 pandemic and its current and anticipated impact on clinical site initiation and patient recruitment. We expect data from the Phase 2 study evaluating EDP 1815 and COVID-19 during the second half of this year. If EDP1815 is effective in limiting the symptoms and progression of COVID-19, we will also explore its potential and other diseases impacted by hyper-inflammation and cytokine storm, including influenza. We will also initiate the Phase 2 dose-ranging study of EDP1815 in mild to moderate psoriasis in the third quarter of this year, with interim data expected by the middle of 2021. We will focus EDP1503 on the treatment of TNBC, and we expect clinical data from this group of patients in the second half of 2020, and we will continue to advance our fourth product candidate and first non-replicating monoclonal microbial, EDP1867, into the clinic in the first quarter of 2021.

I wanted to conclude with revised milestones guidance given the initiation of a phase two trial and Cook at 19.

And the ongoing Cook at 19 pandemic and its current kind of anticipated impact on pinnacle site initiation.

And patient recruitment.

We expect data from the phase two study evaluating <unk> 18, 15 in 'cause it 19 during the second half of this yet.

If he D. P 815 is effective in limiting the symptoms and progression of cobot 19.

We will also explore it to potential.

In diseases.

Impacted by hyper information and cytokine storm, including influenza.

We will also into shape.

Phase two dose ranging study of ATP, 18th 15 in mild to moderate psoriasis.

The third quarter this year with entry mid eights expected by the middle of 2021.

We will focus EDI P 50, no three on the treatment the key NBC and we expect clinical data from this group of patients in the second half of Twentytwenty.

And we will continue to advance a full product kinda that first known replicating monoclonal microbial GDP 18, 67 into the clinic in the first quarter 2021.

Operator: The Phase 1B trial will evaluate the potential of EDP1867 to treat individuals with atopic diseases, either asthma or atopic dermatitis. In closing, let me express my gratitude to the Avelo team and to our partners. Their exceptional work has enabled us to progress our research and clinical development plans during the COVID-19 pandemic. We look forward to updating you further as we progress our programs during 2020. And we'd now like to open up the call to your questions.

Phase won't be trial will evaluate the pendulum GDP 18 67.

Treat individuals with a topic diseases.

Either asthma, all atopic dermatitis.

In closing, let me express my gratitude to the abilities onto our partners.

The exceptional work has enabled us to progress a research and clinical development plans during the Coke at 19 pandemic.

Look forward to uptick you further as we progress up programs during Twentytwenty and we'd now like to open up the cool for your questions.

Thank you, ladies and gentlemen, as a reminder to ask a question you wouldn't be suppressed start one on your telephone keypad withdraw. Your question first the found <unk>. Please stand by law, we compile that can a roster.

Connor (Questioner from Morgan Stanley): Thank you. And, ladies and gentlemen, as a reminder, to ask a question, you will need to press star 1 on your telephone keypad. To withdraw your question, press the pound or hash key. Please stand by while we compile the Q&A roster. And our first question is from Matthew Harrison with Morgan Stanley. Hi all, this is Connor on behalf of Matthew. Thanks for taking the question. We just had two quick questions. Could you just provide some insight on how you feel about maybe timelines and the data in general regarding EDP 1815 and, comparing that with the recent data from MoTesla in mild to moderate. And then just quickly, after prioritizing the inter-capsule formulation..., and then based on the release time, how do you expect this to impact your datasets going forward? Thank you.

And our first question it sounds like you have listen with Morgan Stanley.

Hi, all a this is corner on for Matthew Thanks for taking the question. So we just had two quick question.

Could you just provide some insight on how you feel about maybe timelines and.

The data in general regarding.

18, 15 and.

Overlapping that with the recent data promote Tesla.

Mild moderate and then just quickly.

After prioritizing.

Capsule formulation and then based on the release time, how do you expect it to impact your datasets going forward. Thank you.

Hi, Thanks, So I think three questions let me.

Simba Gill: Hi Conor, thanks. So I think I have three questions. Let me answer the first two in terms of timelines, how we're thinking about EDP 1815, link it to the Tesla situation, and then I'll let Mark answer the question about the entire capsule formulation. The factor we're all obviously dealing with is the impact of COVID-19 on clinical trial initiation and clinical trial recruitment. So we've taken what we consider to be relatively conservative assumptions, recognizing that none of us can accurately predict the impact of COVID-19. So in that context, the guidance that we gave factors that in, and we have to see, obviously, how COVID-19 impacts things. But we're assuming we're starting in the third quarter, when we would otherwise be starting in this quarter.

So the first two in terms of time lines, how if you can bet GDP 18 15.

Link it to the it has a situation and then I'll, let mark I'll answer the question about the entire capsule formulation.

So in terms of timeline.

They were all obviously dealing with is is the impact of covered 19 and tens of clinical trial initiation and clinical trial recruitment. So we've taken what we consider to be relatively conservative assumptions recognizing that none of it's gonna be predicting the type of my team so in that context the guidance.

Okay factors that in we have to see obviously, how 'cause it's 19 impacts things, but was assuming what's stopping the phase two psoriasis dose ranging study.

In the third quarter, we would otherwise be starting this quarter.

Simba Gill: And we've assumed that there will be some significant impact on recruitment, hence the guidance that we'll have results from that phase two psoriasis dose-ranging study by the middle of next year. Obviously, depending on the impact, we could see results potentially as early as Q1 of next year or sometime in Q2, and it's very difficult for us to predict accurately what the actual situation will be. So that's how we're looking at timelines from that perspective, Connor.

And we've assumed.

That will be some significant impact long recruitment, hence the guidance that we'll have result from the phase two psoriasis dose ranging study by the middle of next year, obviously, depending on the impact.

We could see.

Results actually.

As early as Q1, if next year or sometime in Q2, and it's very difficult for us to predict.

What the actual situation will be so that I wouldn't see pipelines from that perspective, Connor obviously in terms of 18 15 to treat 'cause. It my team we have arguably the opposite situation and we would expect that to recruit.

Simba Gill: Obviously, in terms of 18-15 to treat COVID-19, we have arguably the opposite situation in that we would expect that to recruit reasonably quickly on the assumption that COVID-19 will continue to be with us for the foreseeable future. And that's, again, reflected in our guidance. So hopefully, that's helpful with regard to your question on the timeline. With respect to 1815, I'll let Mark embellish on this when he talks about the enteric capsules from a scientific and a clinical perspective.

Reasonably quickly.

On an assumption that topic my team will continue to be with a for the foreseeable future and that's again, if I could not guidance.

So hopefully that's helpful with regards to your question on timeline.

With respect to 18 15, I'll, let mark embellish on that's when he talks about the entire top skills.

From a scientific and clinical perspective for coal point is that we now have.

As I mentioned three separate pinnacle.

Ladies and three separate clinical sets of data, which strongly support central PDP Eighteenfifty has a very effective anti inflammatory acreage in psoriasis and we expect beyond psoriasis as well. So we're feeling very positive about GBP 850, as it links to a Tesla.

Simba Gill: The core point is that we now have, as I mentioned, three separate clinical studies and three separate clinical sets of data that strongly support the potential of EDP1815 as a very effective anti-inflammatory agent in psoriasis and, we expect, beyond psoriasis as well. So we're feeling very positive about EDP1815. As it links to a Tesla... Our view has always been that the big unmet need in psoriasis and most other inflammatory diseases today is actually in patients with mild to moderate disease. And that's always been our initial target entry point, as you know, Connor.

Abuse always being.

The big unmet need in psoriasis and most of the inflammatory diseases today is actually in patients with mild moderate disease and that's always been our initial pocket entry point as you know kona and within mild to moderate disease.

I think the overall profile for the P. I keep 15 is extremely well see the data we have to date.

The P. 18, 15 in psoriasis as much as we can compare with historical data on the Tesla suggests we have something that is at least as efficacious hasn't Tesla.

Mark: And within mild to moderate disease, we think the overall profile of EDP1815 is extremely well suited. The data we have to date with EDP1815 in psoriasis, as much as we can compare with historical data on Tesla, suggests we have something that is at least as efficacious as Tesla and something that has a much more attractive safety and tolerability profile. And then we haven't given formal pricing guidance, but we have made it clear that a central part of our strategy is to develop medicines that are affordable for large patient populations. So we would expect to have a pricing advantage versus a Tesla as well. So just to recap, we are at least as efficacious as a Tesla based on the comparative data that we're able to make at this stage. We have something that appears to have a much improved safety and tolerability profile, and we expect that we will have a pricing advantage as well. So we think we're very well positioned versus. Let me hand over to Mark to talk about empiric capsules, and Mark, you may well want to say something additional about how we're feeling about EDP1850.

And that's something that has a much more attractive safety and tolerability profile.

And then we haven't given formal pricing.

Guidance, but we haven't made it clear that central part of strategy.

Across the whole company is to develop medicines, which all affordable for large patient population. So we would expect to have a pricing advantage versus a tesla as well. So just to recap we are at least as efficacious as a tesla based on the comparative data that we're able to make at this stage.

We have something that appears to have a much improved safety and tolerability profile and we expect that we will have a pricing advantage.

Well.

So we think we're very well positioned versus.

Let me hand up tomorrow to talk about in terms of capsules and Amal you may well wants to say something additional about how we're thinking about GBP 18 50.

I I will do about Oh, sorry, a little bit more about what we think.

Oh Merriman to your question corner about the impact that can also got Oh, clearly as well. So if you recall the preclinical data. We had shows that we had a dose benefit with the alternate formulation and mice and those benefit.

Could've been due to any one of the number of factors, including so I could release bogus concentration release, which I mentioned, Oh really cool and the other factors asset sensitivity.

Mark: I will do that. I'll say a little bit more about what we think's going on there, and then to your question, Connor, about the impact, I can answer that clearly as well. So, if you recall, the preclinical data we had showed that we had a dose benefit with the alternate formulation in mice, and that dose benefit could have been due to any one of a number of factors, including psychic release, the bolus concentration release, which I mentioned earlier in the call, and the other factor is acid sensitivity, which we were not controlling for in the earlier formulations in the preclinical studies. So, there were a number We didn't hit it with the alternate formulation. We went into man, and made a couple of comments on that.

Foam for in the.

Video formulations would be preclinical studies. So there was a series of possible factors that we didnt hit that's with the alternate formulation. We went into man couple of comments on that one is turns off with the dose effect that we saw in my supposed to BBB Bob.

The time, we were proposing a clinical trials with us because we could probably compared to dose response stated my BBB P. H in 15 so.

Symbols point.

Okay.

The alternate formulation is essentially moot because the clinical data in the other three cohorts.

Mark: One is that it turns out that the dose effect that we saw in mice wasn't needed in man. We didn't know that at the time we were proposing the clinical trials for this because we didn't have the comparative dose response data in man with EDP 1815. So, to Simba's point, I think the alternate formulation is essentially moot because the clinical data in the other three cohorts has given us what we need. And I have to say, actually, as an immunologist, and I've talked to other immunologists about this, the data that I told you in the immunopharmacology study where we directly replicated the mechanism are very powerful data. I know it doesn't tell you a lot about what this is gonna do as a drug, but it does tell you that the small intestinal axis is functional in humans, which, of course, has been one of the big questions about our platform since we started this, specifically the question about

Has given us what we need I don't have to say if she has an immunologist.

It's about this the data that I told you in immuno pharmacology study, where we lucky replicated the mechanism.

It's very powerful data I know it doesn't tell you a lot about what this is pretty aggressive drugs does tell you what the small intestine Lexus is functional in humans, which of course has been one of the big questions about our platform since we started this.

So basically the question about.

Impact actually there is no because we manufactured for formulations GMP material would parallel so we were able to make switch.

For one to the other without skipping a beat we try to use for the reason why we've been able to.

Directly into regulatory submissions for doing cope with my team studies and we hope the drug available for starting their studies shouldn't you got the approval.

Mark: Actually, there is none because we manufactured both formulations of GMP material in parallel, so we were able to make the switch from one to the other without skipping a beat, which actually has been the reason why we've been able to go directly into regulatory submissions for doing COVID-19 studies, and we have the drug available for starting those studies as soon as we get the approval to do it. And, of course, we are continuously manufacturing material, drug substances, the same. Actually, we have supplies of the drug substance we'll continue to be manufacturing for future studies as well. It might be worth just pointing out that, despite the pandemic, our supply chain and manufacturing have not been disrupted.

To do it of course, we are continuously.

Manufacturing.

Material.

Drug substance is very much we have supplies of drug substance would consider the manufacturing for the future somebody's as well, but my people work just pointing out that despite the continent call supply chain and manufacturing it's not disrupted.

Understood. Thanks to the thorough response.

Thanks, Bob Thanks.

Thank you.

Our next question comes from Chris Shibutani with Cowen. Please go ahead Chris.

Thank you very much good morning symbol and team two questions. One I think historically you've done some of your clinical work in the UK.

Question simply based upon the context of how we're seeing different geography.

No we confronted with challenges related to this and.

Connor (Questioner from Morgan Stanley): Understood. Thanks for the thorough response.

Operator: Thanks, Phil. Thanks.

In different ways can you just remind us what the geography or for the studies that youre contemplating studying over the near term and then secondly, with the cash runway of $58 million and thinking about what's the R&D spend is like again in the context of some potential modification.

Chris Shibutani (Questioner from Cohen): Thank you. And our next question comes from Chris Shibutani with Cohen. Please go ahead, Chris.

Chris Shibutani (Questioner from Cohen): Thank you very much. Good morning, Simba and team.

Simba Gill: Two questions. One, I think you've done some of your clinical work in the UK, and a question simply based upon the context of how we're seeing different geographies be confronted with challenges related to this pandemic in different ways. Can you just remind us what the geographies are for the studies that you are contemplating studying over the near term? And then, secondly, with the cash runway of $58 million and thinking about what the R&D spend is like, again, in the context of some potential modifications, could you help us understand how you feel about the runway that you have to support these programs, if there's any framing of that kind of timeline that's possible? Thank you.

Could you help us understand how you feel about the runway that you have to support this program. If there's any framing of that kind of timeline that's possible. Thank you.

Yes.

Thanks, Chris. So you are you all right. We have conducted several studies in the UK and let me clarify.

Which studies conducted in the UK, which studies conducted in the U.S. and I would think about that going forward. So the phase one be studies that we've carried out historically, including those that we talked about today.

And they told me dermatitis and psoriasis being carried out in the UK.

Simba Gill: Yeah, thanks Chris. So you are right.

And.

Huh.

Interestingly and importantly that includes the.

Simba Gill: We have conducted several of our studies in the UK, and let me clarify which studies are conducted in the U.K. and which studies are conducted in the U.S. and how we think about that going forward. So the Phase 1B studies that we've carried out historically, including those that we've talked about today, in atopic dermatitis and psoriasis have been carried out in the UK. Interestingly, and importantly, that includes the data that we discussed with the alternate formulation.

The data that we discussed with the alternate formulation. So they studies were completed.

In the midst of the Cobot 19 pandemic and we were able in general for still recruit patients onto those studies.

Some of the patients did drop out, but the bulk of patients across both the psoriasis and they topic dermatitis studies in those phase one piece.

Rick cricket, which allowed us to.

Simba Gill: So those studies were completed in the midst of the COVID-19 pandemic, and we were able, in general, to still recruit patients onto those studies. Some of the patients did drop out, but the bulk of patients across both psoriasis and atopic dermatitis studies in those Phase 1Bs recruited, which allowed us to complete the study and come to the conclusions we described earlier, the CNBC studies that we're carrying out, both historically as well as going forward have been carried out in the U.S. and in Canada, and that will continue to be the situation as we go forward, and the Phase 2b dose ranging study for psoriasis, with EDP1815 will be carried out, across the U.S, the UK and Europe, uh... with at www.cdc.gov.au Develops as we go forward and what impact it might have in different geographies, and so we may well modulate as we go forward. The projected number of sites cuts across multiple different geographies in the U.S. as well as Europe and the U.K. which may be relevant. So there's some spread of potential recruitment risk.

Complete the study and I'm come to the conclusions we described earlier.

The T.N.B.C. studies that were carrying out.

Oh, it's historically as well is going forward.

Being carried out in the U.S. and Canada.

And that will continue to be.

Situation as we go forward.

And the phase to be dose ranging study for psoriasis.

With Eaton P. 18, 15 will be carried out.

Across the U.S.

The UK and Europe.

With that.

Heavy weighting towards U.S. clinical trial sites.

But continues to be the plan right now Chris obviously, we're working very closely with US. He also to make sure when a position the modified recruitment depending on how cook at my team.

Develops as we go forward of what impact it might happen in different geographies.

So we may well modulate as we go forward the projected number of sites cuts across multiple different geographies in the U.S. as well as Europe, and the UK, which maybe relevant so.

So there's some.

Spread of potential recruitment risk the guidance, we've given as I've mentioned, Chris This is conservative.

Simba Gill: The guidance we've given, as I mentioned, Chris, is conservative because we just don't know exactly what the impact is going to be as we go forward. But as I said, we expect to continue the phase 2b dose ranging across the U.S., U.K., and continental Europe. And then finally, the COVID-19 study, it's probably clear, Chris, but just to underscore it, that we announced last week the Phase 2 study is being carried out at Rutgers, so that's all in the U.S. at a single site right now. We do continue to have discussions around additional COVID-19 studies, looking at different stages of the disease and different types of studies, and those cut across multiple different geographies. And we remain optimistic that we'll probably announce additional COVID-19 studies, potentially in geographies outside the U.S., in the not-too-distant future.

Because we just don't know exactly what the impact is going to be as we go for it but as I said, we expect to continue to face to because frankly to be across the U.S. UK and continental.

And then finally, the Coke at 19 study, it's probably clear Chris but just.

To underscore it that we announced last week. The phase two study is being carried out at rocket rough. This so that's all in the U.S. at a single site.

Right now we do continue to have discussions.

Around additional 'cause it 19 studies looking at different stages at the disease.

Different types of study and those kind of cross multiple different geographies.

And we remain optimistic that will probably enough. It did additional coated 19 studies potentially geographies outside the U.S. and they're not too distant future.

And then with regards to the second question on cash runway.

So we expect cash runway on current projections importantly, including the additional covered my teeth study that we announced philosophy into Q1, a 2021, that's actually an extension from where we work before.

Simba Gill: Then with regard to the second question on cash runway, so we expect cash runway on current projections, importantly, including the additional COVID-19 study that we announced to last us into Q1 of 2021. That's actually an extension from where we were before for COVID-19 for a couple of key reasons. One, we have factored in the delay of the Phase II dose-ranging study in ATP18-15 enteritis, and that obviously means a deferment of the Phase II. B dose-ranging expense.

A couple of key reasons, one we have factored in the delay.

All of the phase two dose ranging study and eat <unk>, 18, 15, and psoriasis and that obviously.

I mean, a deferment oh the phase two.

The dose ranging expense.

So with benefiting from that we took a as soon as cobot 19 was declared a pandemic. We took a hard look at all about expenses across the company.

And have essentially deferred handle certain expenses without compromising our ability to move forward. The key clinical programs all to continue to invest in the platform and the pipeline and that's benefiting us as well and then some benefit from the fact now focusing on CNBC.

Simba Gill: So, benefiting from that, we took, as soon as COVID-19 was declared a pandemic, we took a hard look at all of our expenses across the company and have essentially deferred or cut certain expenses without compromising our ability to move forward key clinical programs or to continue to invest in the platform and the pipeline. And that's benefiting us as well. And then there's some benefit from the fact we're now focusing on TNBC with eGP 1503 in oncology setting. And so overall, that's actually extended our cache runway from where we are to where we were before, Chris. So we're now essentially doing broad guidance that we have cache into Q1 2021.

With these to be 15 or three in <unk> oncology.

Setting and so on overall, that's actually extended up cash runway from where we are from where we went before Chris. So we're now speaking broad guidance that we have cash into Q1 2021.

Great.

Right.

Yes, I appreciate it thank you.

Thank you and our next question comes from Matthew a teeny with BMO capital.

Hi, since Oh, Thank you for taking the question. This is not from Matthew.

Chris Shibutani (Questioner from Cohen): Hopefully, that will be helpful. Yes, I appreciate it. Thank you.

Two questions from me one on a TNBC can you give us a little bit more color on.

Operator: Thank you. And our next question comes from Matthew Lucini with BMO Capital. Hi Simba, thank you for taking the question. This is Na for Matthew. Two questions from me, one on the TNVC, can you give us a little bit more color on what you saw that gave you the confidence to keep going in TNVC? And then another one on the psoriasis 1B data, based on what we saw before, where you saw the reduction in LSS and a similar trend in POSI score, what happened today where you completely did not see any clinical response? Can you just clarify that for us? And then also, when are you going to make the detailed data for oncology and psoriasis available to us? Thank you.

What you saw that gave you the confidence to keep going into CNBC and then another one on the so rice is one be data.

HM based on what we saw before where you saw the reduction LSW.

And trending similar trend in hobbies, or what how can a today where are you.

Completely did not see any clinical response can you just clarify that for us.

And then also it's when you when are you going to make a detailed data for oncology and the rice is available to us.

Thank you.

Na (Questioner from BMO Capital): Thanks, Darl, and good morning. So on TMBC and the 1503 program, a couple of points. So just a reminder, as you know now, that's a combination study with Merck's Gertruda in a clinical collaboration with Merck. So we have agreed with Merck that we're not going to disclose any additional data until a clinical conference. We haven't said at which clinical conference. I can't tell you exactly when that will be, but certainly in the second half of this year.

Hi style and good morning.

So.

On a can be see under 15 or three program.

The point so just a reminder, as you know now that's a combination study.

With Merck's Keytruda in a clinical collaboration with Merck So.

We have agreed with knocks it would not going to disclose any additional data until a clinical conference. We haven't said, it which clinical conference I can't tell you exactly.

When that will be but certainly second half of this year.

Simba Gill: And all I'm able to tell you now in terms of the TMBC data that gave us confidence to proceed is that in a small number of patients with TMBC, we are seeing clinical responses, and the proportion of clinical responses we're seeing, if those are maintained, would be very encouraging in terms of having a potential product. So the goal is now obviously to recruit an additional number of patients so that we can see as we expand the number of patients being treated with TMBC whether we're maintaining those clinical responses. So that's the color I can add right now, but again, we will provide more data at clinical and scientific conferences in the second half of this year.

And all.

Got to tell you now now in terms of the T.N.B.C. data. They gave us confidence to proceed is that.

In a small number of patients with T.N.B.C., we are seeing clinical responses and the proportion of clinical responses were seeing if those are maintained.

Would be very encouraging in terms of having a potential products. So the goal is now two obviously recruit an additional number of patients. So that we can see if as we expand the number of patients being treated with TNBC women attaining those clinical response rates.

So that's the color I can add right now, but again, we will provide more data.

Clinical and scientific conferences in the second half that this year with regards to your question on.

Simba Gill: With regard to your question on 1815 in psoriasis, let me first of all be very clear, and the Teric formulation of EDP 1815 showed, as you were suggesting, positive data in lesion severity and PASI scores in two separate cohorts of psoriasis patients. What we reported today with that same formulation is a third positive set of data in a human clinical immunopharmacology study, which Mark reported. So we're very confident in the immunology and the clinical response data we have with EDP1815 in the enteric formulation. However, what we also reported was with the new alternate formulation, we did not see a clinical response. And the reason we didn't see a clinical response there is, we believe, because of the formulation. The details of exactly why that newer formulation did not recapitulate the results we'd seen pre-clinically, we're still working through now.

18, 15 in psoriasis, let me first will be very clear so the.

And Terry formulation of Eaton <unk> 18 15.

Showed as he was suggesting positive data and legal severity and Patti school was in two separate cohorts psoriasis patients. What we reported today with that same formulation is a third post affected data in a human clinical pharmacology study, which mark reported.

So with very confident in the immunology.

On the clinical response, they could we have with either the 18 15 with the entire formulation.

What we also reported was with the new alternate formulation.

We did not see a clinical response and the reason we didn't see a clinical response that is up.

We believe because it's a formulation the details of exactly why that new a formulation did not recapitulate results. We've seen preclinically, we're still working through now mark talked about the different possibilities, but there's something about the formulation, which in the translation from mouse. The mine has led to a lack of clinical response, but to be clear the most important.

Simba Gill: Mark talked about the different possibilities, but there's something about the formulation which, in the translation from mouse to man, has led to a lack of clinical response. But to be clear, the most important point is the entire formulation we continue to have a lot of confidence in, and we reported today a third set of human clinical data that confirms in the next level of detail and in a quantified way the impact we're having with EDP1815 across the entire formulation in humans. So we're being very confident with it. So hopefully, that answers your question.

It's in Paris formulation.

We continue to have a lot of confidence in and we reported today a set of human clinical data confirms and the next level of detail.

And then quantified way the impact what happened with GDP. They take 15 with the inherent formulation in humans. So we're feeling very confident with that so hopefully that answers your question.

Simba Gill: It was very helpful. Thank you. Thank you for taking the time to answer the question.

Yes very helpful. Thank you. Thank you for taking the questions.

Na (Questioner from BMO Capital): Thanks.

Thanks.

Operator: Thank you. And ladies and gentlemen, as a reminder, to ask a question, just press star, then 1. Our next question is from Royersong with Jeffrey.

Thank you, ladies and gentlemen asset reminder, to ask the question just press Star then one.

Our next question, it's on ROI or song with Jefferies.

Hey, good morning, hegemonic, Jim Thanks for taking the question.

Royersong (Questioner from Jeffrey): Hey, good morning. Hey, good morning, Kim.

Royersong (Questioner from Jeffrey): Thank you for taking the question. Two quick ones for the oncology program. So, since you're prototyping the TMBC program, which is kind of obviously very kind of significant, I may need help there.

Two quick ones for oncology program Celsion, you're prioritizing the TNBC pro was a which is kinda.

Obviously, many I kind of thinking okay, and then there. So just curious your view on the on the potential lines of therapy, given youre in combination with Keytruda and we know actual Daddy recently approved or kind of at least a line of therapy. There do you also but there are.

Simba Gill: So, just curious about your view on the potential line of therapy given you're in combination with Keytruda. And we know Trudevi is recently approved in our kind of later line of therapy, and they are doing lots of other combination regimens as well. So, just your thoughts around the competitive landscape moving forward for the triple negative.

As a nation regiment that well so just your thoughts are on the competitive landscape going forward for the triple negative.

Simba Gill: Hey Roy, I think, good morning by the way, and thanks for the question. So I think you just summarized the competitive landscape. So, by definition, we need to have something that will be competitive with the newer combinations that are coming through. And that's something that we believe we have the potential to do with the data that we have to date. So it needs to be confirmed. But to be clear, we factored in the new approval, and, as you know, response rates in combination are now at around the 30% level, with some of the newer combinations that are either being studied or, as you said with Trivelli, have recently been approved. So we factored that in, and you can take it as a given that we assume that we have something that will be competitive with those newer combination products.

Hey, I think Scott and good morning body weight and.

Thanks for the question.

You could just summarize the competitive landscape so by definition we.

Need to have something but will be competitive with the new a combinations that are coming through and that Ah. That's something that we believe we have the potential.

To do with the data that we have to date, so it needs to be confirmed but to be clear we factored in the new approval and as you know response rates in combination that now out around but that's the fence level.

Some of that some of the new combinations that either being studied was he said with trivedi have recently been approved so we factored that in and you can take as it given that we assume that we have something.

That will be competitive.

With those new a combination products.

That's great that's great. Okay, and then another quick one for oncology as well as if you succeed.

Simba Gill: That's great. That's great. Okay. And then another quick one for oncology as well is if you succeed in triple negative, and I know you have done some other tumor types, but you don't see the kind of robust clinical response, but would you expand into other tumor types in the future? Or do you just think that, at least for 1503, you will focus on TMBC alone?

Triple negative and I know you have done some other.

Tumor types, but the Nazi that kind of ethanol bucks to clinical response, but would you expand into other tumor types in the future or you're just the thing youre.

Lisa for 15, I'll see you will focus on Jim do you see alone.

Yeah, no if we see positive results with the next wave of T. M. B C patients will most certainly expecting though [laughter] ROI, sorry, because what will.

Simba Gill: Yeah, no, if we see positive results with the next wave of TMBC patients, we'll almost certainly expand that. Roy, sorry.

Simba Gill: Because what we'll have shown is that 1503 is impacting Systemic Immunity Against the Tumor, in synergy with protruder and checkpoint inhibitors, and if that's shown, then there is potential that's much broader than TMBC. So we will expand, in high likelihood. Obviously, we need to see the data, Roy, but that would be our intention to expand. If we've confirmed efficacy that is competitive with your previous question with other combinations, then it is highly likely we'll expand to other tumors.

I've shown is that 15 of free is impacting.

Systemic immunity against the tumor.

And synergy with with Keytruda on checkpoint inhibitors and it's that showed then there is potential that's much broader than T.N.B.C.. So we will expand.

In high likelihood, obviously, we need to see the data going but that would be our intention to expand if we put them fund efficacy that is competitive previous question with other combinations. A then highly like will expand to other tumor types.

Royersong (Questioner from Jeffrey): Got it. Thank you for taking the question.

Got it think of like is it the question.

Simba Gill: Thank you.

Thank you.

Thank you and I'm not showing any further questions and Nicky I will like to turn the call backs and dr. seem the tail for his final remarks.

Simba Gill: Thank you, and I'm not showing any further questions in the queue. I would like to turn the call back to Dr. Simba Jail for his final remarks.

So I just want to thank everybody for their continued interest in it though.

Operator: So I just wanted to thank everybody for their continued interest in Avelo and also, as I said in my prepared remarks, thank our team at Avelo as well as our partners who've done a remarkable job keeping things moving forward during the COVID-19 pandemic with marginal impacts on all of our activities across research and clinical development. So thank you very much, everyone, and we look forward to updating you on continued progress as we go forward through 2021.

Also.

As I said in my prepared remarks, like Oh team at a velo as well as a partners who've done a remarkable Gulf keeping things moving forward during the 'cause it 19, a pandemic with Marshall impacts on order activity, but the cross research and clinical development. So thank you very much everyone and we look forward to updating you on continued.

Progress as we go forward 320 26.

And with that ladies and gentlemen, we conclude todays program. Thank you for your participation you may now disconnect.

Simba Gill: And with that, ladies and gentlemen, we conclude today's program. Thank you for your participation. You may now disconnect.

[music].

Operator: BF-WATCH TV 2021