Q1 2022 Arrowhead Pharmaceuticals Inc Earnings Call

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Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call throughout todays recorded presentation, all participants will be in a listen only mode.

Operator: Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call. Throughout today's recorded presentation, all participants will be in a listen-only mode.

Vincent Anzalone: After the presentation, there will be an opportunity to ask questions. I will now hand the conference call over to Vincent Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead. Justin, good afternoon, everyone.

After the presentation there'll be an opportunity to ask questions.

I'll now hand, the conference call over to Vincent Anzalone, Vice President of Investor Relations for Arrowhead.

Please go ahead.

Joseph Good afternoon, everyone. Thank you for joining us today to discuss arrowheads results for its fiscal 2022 first quarter ended December 31, 2021 with US today from management are president and CEO , Dr. Christopher Anzalone, who will provide an overview of the quarter Dr. Javier.

Vincent Anzalone: Thank you for joining us today to discuss Arrowhead's results for its fiscal 2022 first quarter ended December 31, 2021. With us today for management is our President and CEO, Dr. Christopher Anzalone, who will provide an overview of the quarter. Dr. Javier San Martin, our Chief Medical Officer, will provide an update on our mid and later stage clinical pipeline. Dr. James Hamilton, our Senior Vice President of Discovery and Translational Medicine, will provide an update on our pulmonary platform, and Ken Myszkowski, our Chief Financial Officer, will give a review of the financials.

And Marty <unk>, our Chief Medical Officer, who will provide an update we'll provide an update on our mid and later stage clinical pipeline Dr. James Hamilton, Our senior Vice President of Discovery and translational medicine will provide an update on our pulmonary platform and Ken Moskovsky, Our Chief Financial Officer, who will give a review of the financials. We will then open.

Up the call to your questions before we begin I would like to remind you that comments made during today's call contains certain forward looking statements within the meaning of section 27, a of the Securities Act of $19 33, and section 21 E of the Securities Exchange Act of 1934, all statements other than statements of historical fact.

Vincent Anzalone: We will then open up the call to your questions. Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact are forward-looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statement.

Our forward looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward looking statements.

Vincent Anzalone: For further details concerning these risks and uncertainties, please refer to our SEC filings, including our most recent annual report on Form 10-K. That said, I'd like to turn the call over to Christopher Anzalone, President and CEO of The Compass.

For further details concerning these risks and uncertainties. Please refer to our SEC filings, including our most recent annual report on Form 10-K .

That said I would like to turn the call over to Christopher Anzalone, President and CEO of the company Chris.

Christopher Anzalone: Thanks, Ben. Good afternoon, everyone, and thank you for joining us today. The biotech market has been a difficult place of late. In 2021, the XPI biotech index was down 21 percent. And during the first month of 2022, the index was down a further 18 percent.

Good afternoon, everyone and thank you for joining us today.

The biotech market has been a difficult place of late in 2021, the Spi biotech index was down 21% and during the first months of 2022, the index was down a further 18%.

Christopher Anzalone: My goal today is not to fight market cycles, but rather to articulate where we are as a company to help you assess Arrowhead's true value. We are here to create innovative new medicines for the millions of patients who desperately need them. And if we stay focused on that important mission, we will continue to create substantial value for our shareholders.

My goal today is not to fight market cycles, but rather to articulate where we are as a company to help you assess arrowheads true value.

We're here to create innovative new medicines for the millions of patients who desperately need them and if we stay focused on that important mission, we will continue to create substantial value for our shareholders.

Christopher Anzalone: That is the lens through which you should view our update today. As Javier, James, and I speak about our continued progress across our programs, think about what those programs will mean to patients, think about what those programs will mean to patients and where those programs will take us as a company. There is much that currently excites me about this great company.

That is the lens through which you should view our update today is high.

James and I speak about our continued progress across our programs think about what those programs will mean to patients.

I think about what those programs will mean to patients and where those programs will take us as a company.

There is much the currently excites me about this great company.

Christopher Anzalone: We had another strong quarter executing on our strategy with respect to platform extension, pipeline expansion, and business development. We continue to make tangible progress across all our programs. Early in the quarter, we hosted a Key Opinion Leader webinar on Arrow C3, our newest clinical stage investigational therapeutic designed to reduce production of complement components 3, or C3, as a potential therapy for various complement-mediated diseases. We also filed a CTA to begin clinical studies and have been activating sites for FIRST in human studies.

We had another strong quarter executing on our strategy with respect to platform extension pipeline expansion and business development, we continue to make tangible progress across all our programs.

Early in the quarter, we hosted a key opinion leader webinar on aerospace three our newest clinical stage investigational therapeutic designed to reduce production of complement components, three or <unk> as a potential therapy for various complement mediated diseases.

We also filed a cta to begin clinical studies and have been activating sites for first in human studies.

Christopher Anzalone: As with all other drug candidates currently in our pipeline, we expect Arrow C3 to be the first RNAi candidate against this target to reach the clinic. We see substantial unmet medical need we could address across a variety of indications, including PNH, autoimmune hemolytic anemia, C3 glomerulopathy, IgA nephropathy, and lupus nephritis. Our preclinical data have been encouraging, and given that this will be our eighth hepatocyte-directed trim candidate in clinical studies, we have a high expectation of success. This program is also a good example of our speed.

As with all other drug candidates currently in our pipeline, we expect <unk> to be the first RNA candidate against this target to reach the clinic we.

We see substantial unmet medical need we could address across a variety of indications, including <unk> autoimmune hemolytic anemia seek they're equally merial apathy, Iga nephropathy and lupus nephritis.

Our preclinical data has been encouraging and given that this will be our eighth <unk> directed trim candidate in clinical studies, we have a high expectation of success.

This program is also a good example of our speed we went from idea to initiating clinical studies in approximately 12 months, we expect to move its similar speed for future pad site director candidates and as the extra hepatic platforms mature we have the potential to move at a similar level of efficiency.

Christopher Anzalone: We went from idea to initiating clinical studies in approximately 12 months. We expect to move at similar speed for future hepatocyte-directed candidates. And as the extra hepatic platforms mature, we have the potential to move at a similar level of efficiency. During the quarter, we and our partners also presented encouraging clinical data on multiple programs, including Arrow HSD for NASH, Arrow AAT, also called TAC-999, for liver disease associated with alpha-1 antitrypsin deficiency. Arrow ApoC 3 for hypertriglyceridemia, and J&J 3989 for hepatitis B virus infection. Without exception, all of those candidates appear to be doing what they are designed to do, and have been generally well tolerated.

During the quarter, we and our partners also presented encouraging clinical data on multiple programs, including Aero HST for Nash <unk> also called Tak 999 for liver disease associated with Alpha one antitrypsin deficiency.

Aero Apoc III for hyper triglyceride, EMEA and J&J $39 89 for hepatitis B virus infection.

Without exception all of those candidates appear to be doing what theyre designed to do and have been generally well tolerated.

Christopher Anzalone: We look forward to continued clinical development and learning more about the potential disease-modifying capabilities of those agencies. We also signed a license agreement with GlaxoSmithKline for Arrow HSD that just recently closed. We are happy to bring on a new partner and look forward to working closely with GSK as they prepare to start a Phase II study. Under the terms of the agreement, GSK received an exclusive license to develop and commercialize Arrow HSD in all territories except Greater China, which was retained by Arrowhead.

We look forward to continued clinical development and learning more about the potential disease modifying capabilities of those agents.

We also signed a license agreement with Glaxo Smith Smithkline for Aero HST that just recently closed we're happy to bring on a new partner and look forward to working closely with GSK as they prepare to start a phase II study.

Under the terms of the agreement GSK received an exclusive license to develop and commercialize arrow HST in all territories, except greater China, which was retained by arrowhead.

Christopher Anzalone: Arrowhead received an upfront payment of $120 million and is eligible for a $30 million milestone at the start of phase two. $100 million milestone at the start of Phase 3, up to $190 million in milestones at launch in the U.S. in major markets, and up to $590 million for key sales milestones. Arrowhead is further eligible to receive tiered royalties of mid double digit to 20% on net product sales.

<unk> received an upfront payment of $120 million.

And is eligible for a $30 million milestone at the start of phase III.

Hundred million dollars milestone at the start of phase III up to a $190 million in milestones at launch in the U S in major markets and up to $590 million for key sales milestones.

Rohit has further eligible to receive tiered royalties of mid double digit to 20% on net product sales.

Christopher Anzalone: I expect GSK to be a great partner for this exciting, genetically validated candidate. They have a clear commitment to genetic medicine and to finding an effective treatment for NASH, which could include a staggering number of patients. Understanding the complicated biology of the, and addressing a potentially very large global market are substantial challenges indeed.

I expect GSK to be a great partner for this exciting genetically validated candidate.

We have a clear commitment to Jack to genetic medicine, and defining an effective treatment for Nash, which could include a staggering number of patients understanding.

Understanding the complicated biology of this disease and addressing a potentially very large global market are substantial challenges indeed, and we believe that GSK will be a powerful partner to complete clinical development and ultimately deliver a potentially important medicine to the tens of millions of patients who need it.

Christopher Anzalone: And we believe that GSK will be a powerful partner to complete clinical development and ultimately deliver a potentially important medicine to the tens of millions of patients who need it. Moving to our cardiometabolic programs, we recently initiated Arrowhead's first Phase 3 study, which I see as a key milestone event and indicative of a maturing company. The Palisade study is a Phase 3 clinical study to evaluate the efficacy and safety of Arrow ApoC-3 in adults with familial chylomicronemia syndrome, or FCS.

Moving to our cardio metabolic programs. We recently initiated arrowheads first phase III study, which I see as a key milestone event and indicative of a maturing company.

The palisade study is a phase III clinical study to evaluate the efficacy and safety of Aero Apoc III in adults with familial chylomicron anemia syndrome or Fcs.

Christopher Anzalone: Arrow ApoC-3 is our investigational RNAi therapeutic designed to inhibit the production of apolipoprotein C-3 or ApoC-3, a key regulator of triglyceride metabolism. Prior studies have been very encouraging, where we have seen greater than 90% triglyceride reduction in some patient populations. This type of dramatic effect could really move the needle for FCS patients who have very little in the way of therapeutic options at present. We also made good progress on patient enrollment for the two Arrow ApoC3 Phase 2B studies in severe hypertriglyceridemic patients, the Shasta 2 study, and those with mixed dyslipidemia, the MURE study. These are populations that we believe have few therapeutic options, and data from our prior studies suggest that Arrow ApoC3 could be highly meaningful by lowering triglycerides and raising HDL.

Aero Apoc III is our investigational <unk> therapeutic designed to inhibit the production of able lipoproteins C III or apoc III, a key regulator of triglyceride and metabolism.

Prior studies have been very encouraging where we have seen greater than 90% triglyceride reduction in some patient populations.

This type of dramatic effect could really move the needle for FCS patients, who have very little in a way of therapeutic options at present.

We also made good progress on patient enrollment for the two <unk> three phase III <unk> studies in severe hyper triglyceride patients the Shasta Shasta two study and those with mixed Dyslipidemia Mirror study.

User populations that we believe have few therapeutic options and data from our prior studies suggest that <unk> could be highly meaningful by lowering triglycerides and raising HDL.

Progress on the Aero and three phase <unk> study in mixed.

In mixed Dyslipidemia. The arches, two study has been rapid and I expect enrollment to be complete in the coming months.

Christopher Anzalone: Progress on the Arrowhands 3 Phase 2B study in mixed dyslipidemia, the Arches 2 study, has been rapid, and I expect enrollment to be complete in the coming months. We continue to see a big opportunity to help the millions of patients with elevated triglycerides and LDL cholesterol, and we are optimistic that Arrow ANG3 could be an important future medicine, given our prior data and exciting work done by others to validate the target.

We continue to see a big opportunity to help millions of patients with elevated triglycerides and LDL cholesterol and we are optimistic that <unk> could be an important future medicine, given our prior data and exciting work done by others to validate the target.

Christopher Anzalone: As has been our consistent practice at Arrowhead of bringing the first RNA I compound into the clinic against specific gene targets, Arrow Ang 3 was the first RNA I compound in clinical studies that targets Ang PTL 3. Furthermore, the competitive landscape seems to have shifted even further in our favor, with the recent announcement that Pfizer has discontinued its partnership with Ionis on its anti-sense approach to Ang ptL. Of course, we do not have deep knowledge of data coming out of that program, and it is always difficult to compare results across different studies.

As has been our consistent practice at Arrowhead, bringing the first RNA high compound into the clinic against specific gene targets <unk> three was the first RNA I compound in clinical studies, the targets and <unk> III.

Further the competitive landscape seems to have shifted even further in our favor with the recent announcement that Pfizer has discontinued its partnership with <unk> on its antisense approach to <unk> III.

Of course, we do not have deep knowledge of data coming out of that program and it is always difficult to compare our results across different studies, but given what we have seen publicly we continue to be confident in our candidates.

Christopher Anzalone: But given what we have seen publicly, we continue to be confident in our candidates. For instance, data from our Phase 1-2 study indicated the following. Arrowhange 3 has demonstrated very deep and durable activity, enabling quarterly or less frequent dosing. Ang-PTL-3 levels were reduced in a dose-dependent fashion from 78 to 90 percent after 100, 200, or 300 milligrams of Arrow Ang-3. We saw mean triglyceride reductions up to 73.5% and mean non-HDL cholesterol reductions up to 50%. Only two patients had elevated ALTs and in both cases there were concomitant medications associated with increases in ALTs and in both cases the elevation was transient and not associated with increases in bilirubin.

For instance data from our phase one two study indicated indicated the following.

<unk> has demonstrated very deep and durable activity enabled enabling quarterly or less frequent dosing.

<unk> three levels were reduced in a dose dependent fashion from 78% to 90%. After 100, 200 or 300 milligrams of <unk> III we.

We saw a mean triglyceride reductions up to 73, 5% and mean non HDL cholesterol reductions up to 50%.

Only two patients had elevated <unk> and in both cases, they were concomitant medications associated with increases in <unk> and in both cases, the elevation was transient and not associated with increases in bilirubin.

Christopher Anzalone: And we have seen no indication that Arrowhands 3 led to any increase in liver fat. Let's now move to our pulmonary platform. James will give a fuller review during this call, but I wanted to highlight a few developments. First, we continue to make progress on the ENAC target, but will likely not continue with Arrow ENAC, the candidate that we are testing in a Phase 1-2 study last year. We have two to three next generation compounds that appear to have favorable pharmacologic properties compared to Arrowhead.

And we have seen no indication that arrow and three led to any increase in liver fat.

Let's now move to our pulmonary platform James will give a fuller review during this call, but I wanted to highlight a few developments first we continue to make progress on the <unk> target, but will likely not continue with arrow enact the candidate that we are testing in a phase one two study last year.

We have two to three next generation compounds that appear to have favorable pharmacologic properties compared to arrow.

Christopher Anzalone: And a step behind this, we are also exploring ways to deliver pulmonary targeted drug candidates via subcutaneous administration, which we believe would be a true breakthrough, and are testing this for ENAC as well. We are likely changing horses in the ENAC program, but we have not yet settled on which new horse.

Behind this we are also exploring ways to deliver pulmonary targeted drug candidates via subcutaneous administration, which we believe would be a true breakthrough and are testing this for <unk> as well.

So we're likely changing horses in the <unk> program, but we have not yet settled on which new horse.

Christopher Anzalone: We've also discussed our plans to file two new pulmonary CTAs this year, but had not previously disclosed the targets or disease areas. I'm excited to announce these programs formally as Arrow RAGE and Arrow MUC5AC, each being developed for various mucoobstructive and inflammatory pulmonary conditions. We are on track to file CTAs for both of these over the next quarter.

We've also discussed our plans to file two new pulmonary Cta as this year, but had not previously disclosed the targets or disease areas I'm excited to announce these programs, formerly as arrow rage, and Aero Muck five AC each being developed for various mutual obstructive inflammatory pulmonary conditions.

We're on track to file Cta is for both of these over the next quarter.

Christopher Anzalone: We will be presenting preclinical data at the American Thoracic Society meeting in May, and we also plan to host a KOL webinar or pulmonary specific R&D day this year. At the latter event, we intend to go into detail on the biology of the targets, present preclinical data, introduce the commercial market opportunity, explain our plans for the clinical studies, and have an outside KOL describe the clinical presentation of the disease and unmet medical need.

We will be presenting preclinical data at the American thoracic Society meeting in May and we also plan to host a cable a webinar or pulmonary specific R&D day. This year at the latter event, we intend to go into detail on the biology of the targets present preclinical data introduced the commercial market opportunity explain our plans for the clinical studies and have an <unk>.

Outside Kols described the clinical presentation of the disease, an unmet medical need.

Christopher Anzalone: We're pleased that we expect to file two new pulmonary CTAs in the first half of 2022 and are also on track to file a third by the end of this year. That target and disease area remain undisclosed. While still on the pulmonary platform, we continue to make progress in COVID and are currently testing compounds that are leading to substantially decreased lung inflammation and viral expression in animal models. This is exciting for what they may mean for the current SARS-CoV-2, but also potentially for other SARS-based coronaviruses. As you may recall, we are working to develop antiviral agents by targeting regions that are well-conserved across known SARS coronaviruses with the hope that we could treat current and future novel infections.

We're pleased that we expect to file two new culinary Cta as in the first half of 2022 and are also on track to file a third by the end of this year.

At target and disease area remain undisclosed.

While still in the pulmonary platform, we continue to make progress in Covid and are currently testing compounds that are leading to substantially decreased lung inflammation and viral expression in animal models. This.

This is exciting for what they may mean for the current Sars Covid two but also potentially for other <unk> based corona viruses as.

As you May recall, we are working to develop antiviral agents by targeting regions that are well conserved across a known as Sars Corona viruses with the hope that we could treat current and future novel infections.

Christopher Anzalone: Our progress here has also opened doors for us in other respiratory viruses, where we now have active programs. We could see that becoming a substantial sub-franchise, if you will, within our pulmonary platform. These are exciting opportunities for us and we look forward to updating you on our progress. In addition to the two new pulmonary CTAs in the first half of this year, we are on track with AeroDUX4, our first skeletal muscle targeted candidate against FSHD. Consistent with our prior guidance, we expect to file that CTA by the end of the first half of.

Our progress here has also opened doors for us and other respiratory viruses, where we now have active programs.

We could see that becoming a substantial sub franchise, if you will within our pulmonary platform.

These are exciting opportunities for us and we look forward to updating you on our progress.

In addition to the two new pulmonary <unk> in the first half of this year. We are on track with Arrow Dux for our first skeletal muscle targeted candidate against Fsh D.

Consistent with our prior guidance, we expect to file the Cta by the end of the first half of this year.

Christopher Anzalone: This represents a leap forward with the addition of another cell type we can target clinically, and more specifically, Arrow Dux4 may offer us the ability to help a group of patients with no real therapeutic options. Recent failures and setbacks in the field have underlined the unmet medical need that currently exists and we are moving as fast as we can for the FSHD patients who need us. Our partner programs have also made good progress.

This represents a leap forward with the addition of another cell type, we can target a clinically and more specifically <unk> four may offer us the ability to help a group of patients with no real therapeutic options.

And failures and setbacks in the field have underlying the unmet medical need that currently exists and we are moving as fast as we can for the FSA HD patients who need us.

Our program programs have also made good progress.

Christopher Anzalone: J&J continues its Phase 1 progress in J&J 75-220795, our partner NASH Therapeutic, and J&J 3989, our partner HPV Therapeutic. The latter is in multiple Phase IIb studies that have started to read out, and I would expect regular data from them over the next few years. As we discussed on our last earnings call, J&J 3989 is doing exactly what it was designed to do, and we look forward to seeing how it performs over time and in combination with different agents.

J&J continues its phase one progress and J&J 75 to 207 hundred 95, our partner Nash therapeutic and J&J $39 89 or partnered HBV therapeutic.

The latter is in multiple phase <unk> studies that have started to readout and I would expect regular data from them over the next few years as.

As we discussed on our last earnings call J&J <unk> thousand 989 is doing exactly what it was designed to do and we look forward to seeing how it performs over time and in combination with different agents.

Christopher Anzalone: We'll pass around the candidates against cardiovascular disease that we licensed to Amgen continues in a phase two study. Amgen has said publicly that they expect to complete the Phase 2 in the first half of this year. Data from the Phase 1 were impressive, and we look forward to seeing Phase 2 data and the initiation of a Phase 3. Arrow AAT has an ongoing phase 2b study that is currently starting to read out PK data at three different dose levels and will read out biopsy data in the third or fourth quarter.

I'll pass around the candidate against cardiovascular disease that we licensed to Amgen continues in our phase II study.

<unk> said publicly that they expect to complete the phase two in the first half of this year.

Data from the phase one were impressive and we look forward to seeing phase II data and the initiation of a phase III.

<unk> has an ongoing phase <unk> study that is currently starting to readout PK data at three different dose levels and will read out biopsy data in the third or fourth quarter.

Christopher Anzalone: We continue to work closely with Takeda and expect to continue discussions with regulators this year about our data and plans for a pivotal study. Our work with Verizon continues to move rapidly in the area of chronic gout, and I will defer to them to provide guidance and future plans in time. Lastly, we completed a transaction to purchase 13 acres of land in Verona, Wisconsin, which is planned to be the site of a new GMP drug manufacturing facility and an associated laboratory and office facility. Construction is starting this quarter.

We continue to work closely with Takeda and expect to continue discussions with regulators this year about our data and plans for a pivotal study.

Our work with Horizon continues to move rapidly in the area of chronic gout and I'll defer to them to provide guidance and future plans and timing.

Lastly, we completed a transaction to purchase 13 acres of land in Verona, Wisconsin, which is planned to be the site of a new GMP drug manufacturing facility and an associated laboratory and office facility.

Construction is starting this quarter completion.

Christopher Anzalone: Completion of the lab and office space is anticipated in early to mid 2023 and completion of the manufacturing facility is expected in late 2023. We will continue to operate additional research and development facilities in Madison, Wisconsin, and San Diego, California. We also signed a lease to what will allow us to substantially expand our research laboratories and administrative offices in San Diego in the first half of 2023. We believe the new Arrowhead campuses will allow us to support our growing pipeline and we think positions us well to advance the manufacturing process, including a commercial scale of our trim-enabled drug candidates.

Completion of the lab and office space is anticipated in early to mid 2023 and completion of the manufacturing facility is expected in late 2023.

We will continue to operate additional research and development facilities, and Madison, Wisconsin, and San Diego, California.

We also signed a lease to what will allow us to substantially expand our research laboratories and administrative offices in San Diego in the first half of 2023.

We believe the new Arrowhead campuses will allow us to support our growing pipeline and we think positions us well to advance the manufacturing process, including at commercial scale of our trim enabled drug candidates.

Christopher Anzalone: We view this as a strong competitive advantage as we approach potential commercialization of our rapidly progressing clinical candidates. So in summary, our pipeline is expanding and maturing. Our platform is providing additional opportunities to discover and develop new investigational medicines in areas where Arrowhead has unique capabilities and expertise. We are using business development selectively to maximize the value of our technology, and to bring in non-dilutive capital to support our internal development program.

We view this as a strong competitive advantage as we approach potential commercialization of our rapidly progressing clinical candidates.

So in summary, our pipeline is expanding and maturing our platform is providing additional opportunities to discover and develop new investigational medicines in areas, where arrowhead has unique capabilities and expertise.

We are using business development selectively to maximize the value of our technology and to bring in non dilutive capital to support our internal development programs.

Javier San Martin: And we're investing to expand our R&D footprint and take more control of the drug manufacturing process to support clinical and ultimately commercial supply needs. We believe all of this puts Arrowhead in a very strong competitive position. And with that overview, I'd now like to turn the call over to Dr. Javier San Martin. Javier?

And we are investing to expand our R&D footprint and take more control of the drug manufacturing process to support clinical and ultimately commercial supply needs.

We believe all of this puts arrowhead and a very strong competitive position.

With that overview I'd now like to turn the call over to Dr. Javier San Martin Javier.

Javier San Martin: Thank you, Chris. And good afternoon, everyone. I will provide status updates on three of our later stage clinical, Arrow ApoC-3, Arrow H3, our investigational cardiometabolic medicine, and Arrow AAT, also called TAX-999, our investigational medicine designed to treat Alpha-1 liver disease, which is being co-developed with Takeda. First Arrow ApoC3 is our investigational medicine targeting ApoLipoprotein C3 being studied in patients with various lipid disorders. Collectively, the mid and late stage clinical study for Arrow ApoC3 are called the Summit Program.

Thank you Kris and good afternoon, everyone. We provide status updates on three of our later stage clinical programs.

<unk> three <unk>, three our investigational cardio metabolic <unk> and Italy.

Also called Tuck 99 nine.

<unk>, maybe seen designed to treat alpha one liver disease, which is being co developed with Takeda.

<unk> is our investigational medicines targeting apolipoprotein C III.

<unk> study in patients with various lipid disorders.

They need in late stage clinical study for <unk>.

Semi program.

Javier San Martin: We made good progress bringing in new sites for each of the studies and were very pleased with the pace of patients' enrolment. I will discuss each study individually. TASTA-2 is a double-blind, placebo-controlled, phase-2b study of Arrowhead POC3 in adults with severe hypothyroidic thalidemia or SHTD. The population is defined as having triglycerides greater than 500 mg per deciliter.

We made good progress, bringing on new site for each of the studies and were very pleased with the pace of patients from Goldman I will discuss each individually.

That too is a double blind placebo control phase II study of <unk>.

<unk> in adults with severe hypercholesterolemia or <unk>. These population is defined as having greater.

Greater than 500 million as per the CDC deployment.

Javier San Martin: The primary objective of the Shasta II study is to evaluate the safety and efficacy of Arrow ApoC3 and to select a dose enrichment for the later stage clinical studies in this patient population. Approximately 216 patients will be enrolled in this study. Moving on to the MIR study, which is a double-blind, placebo-controlled, phase 2b study of Arrowhead Pocitri in adults with mixed dyslipidemia, population is defined as having triglycerides between 150 and 500 milligrams and non-HDL cholesterol greater than 100 milligrams or LDL cholesterol greater than 70 milligrams per deciliter. The primary objective of the MIR study is to evaluate the safety and efficacy of Arrowhead Pocetri and to select a dose and dose enrichment for later stage clinical studies in patients with mixed disease epidemics.

The preliminary <unk> studies to evaluate the safety and efficacy of <unk> and select dosing regimen for the later stage clinical studies in these patient populations.

Approximately 216 patients will be enrolled in the study.

Moving on to a new study, which is a double blind placebo controlled phase II B study of Arrow.

Proceed three in apples with mixed Dyslipidemia.

This population is defined as having triglycerides between 150, and 500 milligrams and non HDL cholesterol and greater than 100 milligrams or LDL cholesterol greater than 70 milligrams per deciliter.

The parameter of shifting of immune study is to evaluate the safety and efficacy of <unk> and to select the dose and dosing regimen for later stage clinical studies in patients with mixed Dyslipidemia.

Total of approximately 320 patients will be enrolled.

The most recent study initiating the semi program is policy.

Javier San Martin: A total of approximately 320 patients will be enrolled in this study. The most recent study initiated in the SAMI program is Pallasate. Tree Study to Evaluate the Efficacy and Safety of Arrow Apositree in Adults with Familiar Chylomethronemia Syndrome, or FCA.

T study to evaluate the efficacy and safety of <unk> in adults with familial <unk> syndrome or Fcs.

Javier San Martin: These are patients with fasting triglycerides greater than 880 mg per deciliter that are refractory to standard lipid-lowered therapy and have a diagnosis of FCS, because they tend to have extremely high triglycerides. Patients with FCS have an elevated risk of recurrent and painful bouts of pancreatitis. These patients currently have very limited treatment. The primary endpoint of parasites is the percent change from baseline at month 10 in fasting triglycerides.

These are patients with first integrated with greater than 818 meeting.

So that's a refractory to standard lipid lowering therapy and have a diagnosis of FCA.

Because they tend to have extremely high triglycerides in patients with FCS have an elevated risk of recurrent painful boats of pancreatitis. These.

Patients currently have very limited treatment options.

The primary endpoint of Palisades is the percent change from baseline at months, Tim in the fasting triglyceride.

Javier San Martin: Additional secondary and exploratory endpoints include the change in other lipid parameters, incidence of acute pancreatitis, and other, Approximately 60 patients will be enrolled. I will now move on to ArrowH3, our investigational medicine designed to reduce production of angiopoietin liprotein 3, HPTL3, as a potential treatment for patients with mixed sleep epidemia. The set of mid- and late-stage studies for Arrowhead Entry is called the VISTA program.

Additional secondary and exploratory endpoints include the change in other lipid parameters incidence of acute pancreatitis and other measures.

Approximately 60 patients will be enrolled.

Sure.

I will now move onto <unk>, three our investigational medicine designed to reduce pollution of angiopoietin like protein three HPT, a three as a potential treatment for patients with mixed dyslipidemia.

The set of needs and late stage studies for Italy is called the step program.

Javier San Martin: The VISTA program has one active study and one additional planned study that I will describe briefly in a moment. The currently active study is ARCOS-2, a double-blind, placebo-controlled, phase 2b study of investigational Arrowhange 3 in adults with myx dyslipidemia, population is defined the same way as in the Arrow ApoC3 MIR study. This patient had triglycerides between 150 and 500 milligrams per deciliter and non-HDL cholesterol greater than 100 milligrams per deciliter or LDL cholesterol greater than 70 milligrams. The primary objective of the R2-Study is to evaluate the safety and efficacy of Arrowhead H3 in adults with mixed dyslipidemia and select a dosing regimen for later stage clinical studies in this patient population.

If these petro one active and one additional plan study, though I will describe briefly in a moment.

It currently active studies are close to a double blind placebo controlled phase II study of investigation on payroll HP in adults with mixed dyslipidemia.

Population is defined the same way as in Diego April Cte study.

These patients have figured.

It is between 150 <unk> meeting.

And non HDL cholesterol greater than 100 milligrams per deciliter, LDL cholesterol greater than 17 meeting that for the city.

The primary objective of they are just two study to evaluate the safety and efficacy of <unk> in adults with mixed Dyslipidemia and finished dosing regimen for later stage clinical studies in this patient population.

Javier San Martin: Total of approximately 180 patients will be enrolled. The next study plan for the VISTA program is GATEWAY, a phase two study of Arrowhead 3 in patients with homozygous familial hypercholesterolemia, or HOF. Statins and PCSK9 inhibitors can inhibit cholesterol synthesis and enhance hepatic clearance of LDL cholesterol through upregulation of the hepatocyte LDL receptor.

Approximately 180 patients will be enrolled in the study.

The next study plan for the Vista program as Gateway, if phase II study of <unk> in patients with homozygous familial hypercholesterolemia or <unk>.

Javier San Martin: Patients with HOFH can have dysfunctional or absent LDL receptors and thus can be resistant to statins and even resistant to alternatives such as PCSK9 inhibitors, patients with HOFH are therefore a population with a particularly high need for additional therapies with a mechanism that works outside of the LDL receptor such as HPTL-3 inhibitors. There are ways in open-level studies that will be conducted in subjects with documented HOFH based on genotype or clinical criteria, up to approximately 16 factions who meet eligibility criteria will be randomized in a one-on-one ratio to receive two doses of 200 or 300 mg of Arrowhead 3 on day 1 and day 84 and will be evaluated over a 36-week period, are getting up to initiate the study in the first half of 2022 and will provide an update when the first patient has been, Consistent with the other Phase II studies in both the VISTA and SAMI programs, we want to give Arrowhead maximum flexibility to initiate Phase III studies in multiple patient populations if the data work.

Page <unk>.

<unk> inhibitors and <unk>.

<unk> cholesterol synthesis and enhance hepatic clearance of LDL cholesterol to upregulation of the Petro side LDL receptor.

If we the HOS HK has dysfunction or absent LDL receptor and that can be resistant to studying it's uneven resistance to alternatives such as <unk> nine inhibitors.

Thanks, Yes, HOA phage are therefore in a population with a particularly high need for additional therapies, we didn't make any set waste outside of the LDL receptor such as <unk> in each.

Gateways, an open label study that will be conducted infectious with documented HOA page based on genotype or clinical criteria.

Approximately 60 infectious who meet the eligibility criteria will be randomized in a one one ratio to receive two doses of 200 or 300 million guys of it'll agency on day, one and the 84 and will be evaluated over a 36 week period.

But getting up to initiate the study in the first half of 2022, and we'll provide an update when the first patient have been enrolled.

Consistent with the other phase two studies in both the.

Semi programs, we want to give maximum.

Maximum flexibility to initiate phase III studies in multiple patient populations.

That warranty.

Javier San Martin: At the end of these Phase II studies, we hope to have a good understanding of the pharmacodynamic effect of both investigational medicine in various patient populations with different baseline lipid profiles. We believe that this will inform our development strategy and also help shape our commercial strategy in both well-defined rare diseases as well as larger high-prevalence, I also want to give a brief update on Arrow AAD also called TAC 999. After receiving breakthrough therapy designation, we began a productive dialogue with the FDA about the program. We expect to have data on the reduction of circulating level of AAT from sequoia in the first half of this year, which will be used to select adults for Phase III.

At the end of these phase II studies, we hope to have a good understanding that the kind of macro dynamic affecting both investigational medicine in various patient populations with different baseline lipid profiles.

We believe that this will inform our development strategy and also help shape, our commercial strategy in both well defined rare diseases as well as largely a high prevalence disease.

I also want to give a brief update on AIA also called Tak 999, after receiving breakthrough therapy designation, we began a productive dialogue with the FDA about the program. We expect to have data on the reduction of circulating level of AAP from Sequoia in the first half of this year.

Here, which would be used to selected those full phase III.

Javier San Martin: We should also be collecting the last 12 months biopsy from the last patients enrolled sometime in the summer of 2022. Together with Takeda, we look forward to continuing the dialogue with the FAA after one or both of these data. I will now turn the call over to Dr. James Hamilton. James.

We should also be collecting the last 12 months biopsy from the paid for the last patients enrolled sometime in the summer of 2022.

Together with the K that we look forward to continuing the dialogue with the FDA after one or both of these data readouts.

I will now turn the call over to Jim Chambers.

James.

James Hamilton: Thank you, Javier. There are a lot of exciting new programs in discovery and early stage clinical development. Our R&D organization is operating at an impressive pace and making important progress in multiple areas. Today, I would like to focus on the pulmonary platform, the planned expansion of the pulmonary pipeline, and provide an update on where we are with Arrow Enix. As Chris mentioned, our newest pulmonary candidates are Arrow Rage and Arrow MUC5AC.

Thank you Javier.

There are a lot of exciting new programs in discovery and early stage clinical development.

Our R&D organization is operating at an impressive pace and making important progress in multiple areas.

James Hamilton: They are both on schedule to have CTA filings during the first half of this year. Additionally, we plan on filing a third pulmonary CTA in Q4 of this year. The target for this third program will remain undisclosed at this time. The first program, Arrow Moc5AC, targets expression of Moc5AC in bronchial epithelium. MUC5AC is a mucin protein with upregulated expression in the asthmatic airway. MUC5AC is not normally required for bacterial defense or mucociliary clearance in healthy individuals.

Today, I would like to focus on the pulmonary platform.

Planned expansion of the pulmonary pipeline.

And provide an update on where we are with <unk>.

As Chris mentioned, our newest pulmonary candidates are Aero rage, and Aero Mach five AC.

They are both on schedule to have Cta filings during the first half of this year.

Additionally, we plan on filing a third pulmonary Cta in Q4 of this year.

The target for this third program will remain undisclosed at this time.

The first program Arrow marked by they see targets expression of multiply they see and bronchial epithelium.

James Hamilton: However, in asthmatic patients, its upregulation and enhanced secretion can lead to a mucoobstructive disease state, which is not directly addressed by currently available therapies. The degree of mucus obstruction in the asthmatic airway is highly correlated with poor asthma control and increased disease severity.

Mark by they see is amusing protein with up regulated expression in the asthmatic Irwin.

<unk> is not normally required for bacterial defense or mucociliary clearance in healthy individuals. However.

However, in asthmatic patients, it's upregulation and enhanced accretion can lead to a mutual obstructive disease state, which is not directly addressed by currently available therapies.

The degree of mucus obstruction in the asthmatic airway is highly correlated with poor asthma control and increased disease severity.

James Hamilton: Additionally, multiple genome-wide association studies have demonstrated a correlation between enhanced MUC5AC expression and the development of as, Similarly, mice with a genetic deletion of MUC5AC are protected from airway hyperreactivity in the setting of allergic stimuli, again supporting the concept that MUC5AC-driven mucus plugging plays a central role in allergen-induced airflow obstruction. Arrow Muck 5AC is an extremely exciting program, in part because it represents a fundamentally new way of treating asthma. By targeting the mucus, we have a unique and potentially very powerful tool.

Additionally, multiple genome wide Association studies have demonstrated a correlation between enhanced by <unk> expression and the development of asthma.

Similarly mice with a genetic deletion of multiply they see are protected from airwave hyper reactivity in the setting of allergic stimuli again supporting the concept that multiply they see driven mucus plugging plays a central role in Allergan induced airflow obstruction.

Arrow marked by they see is an extremely exciting program in part because it represents a fundamentally new way of treating asthma.

Targeting the mucus, we have a unique and potentially very powerful tool.

James Hamilton: An abstract summarizing preclinical data leading to the nomination of this clinical candidate will be presented at the American Thoracic Society meeting this spring. The second program, Arrow Rage, targets expression of the Receptor for Advanced Glycation End Products, or RAGE, which is primarily expressed by alveolar and bronchial epithelium. RAGE is a transmembrane receptor that binds to numerous pathogen associated and cell damage associated ligands to activate various components of the innate immune system. RAGE represents an upstream mediator of the inflammatory cascade in asthma, as it is required for allergen induced release of IL-33 into the airway and acts upstream of type 2 cytokines including IL-4, IL-5, and IL-13.

An abstract summarizing preclinical data leading to the nomination of this clinical candidate will be presented at the American Thoracic Society meeting this spring.

The second program.

Page targets expression of the receptor for advanced location and products, where rage, which is primarily expressed by alveolar and bronchial epithelium.

Rage is a transmembrane receptor that binds to numerous pathogen associated and cell damage associated ligand to activate various components of the innate immune system.

Rage represents an upstream mediator of the inflammatory cascade in asthma as it is required for Allergan induced release of IL 33 into the airway and acts upstream of type two cytokines, including IL four IL five and IL 13.

James Hamilton: Importantly, a soluble component of RAGE, known as S-RAGE, can be followed as a serum biomarker of gene target knockdown. This is a very important point that I want to highlight. The availability of a circulating biomarker will teach us a lot about the candidate, and importantly, may inform on the pulmonary platform broadly. Our hepatocyte-directed TRIM system has proven to translate very predictably from preclinical models to human results, and over the last few years, that predictability has increased the speed of our new programs and our expectation of success.

Importantly, our soluble component of rage known as S. Rage can be followed as a serum biomarker of gene target knockdown.

This is a very important point that I wanted to highlight.

The availability of a circulating biomarker will teach us a lot about the candidates and importantly may inform on the pulmonary platform broadly.

Our hepatocytes directed trim system has proven to translate very predictably from preclinical models to human results and over the last few years that predictability has increased the speed of our new programs.

Our expectation of success.

James Hamilton: We hope to get to the same point with pulmonary-directed trim system and the availability of SRAGE circulating biomarker data informing on depth and duration of gene target knockdown using an inhaled route of administration, could get us closer to that point. Animal data suggest that rage signaling plays a critical role in the pulmonary inflammatory responses to inhaled stimuli. Rage Knockout Mice, show a markedly attenuated response to allergen exposure.

We hope to get to the same point with pulmonary directed trim system and the availability of <unk> circulating biomarker data informing on depth and duration of gene target knockdown using an inhaled route of administration.

Could get us closer to that point.

Animal data suggest that rage signaling plays a critical role in the pulmonary inflammatory responses to inhaled stimuli.

Rage knockdown knockout mice.

Joe a markedly attenuated response to Allergan exposure.

James Hamilton: In animals, RAGE is necessary for activation of airway inflammatory pathways relevant to both type 2 high and potentially type 2 low asthma phenotypes. Further studies have indicated that rage knockout mice are protected from allergen provoked increases in IL-33 and TSLP, which represent key upstream drivers of asthmatic type 2 inflammation. Thus, we believe a rage inhibition offers the possibility of arresting the most proximal components of airway inflammation and asthma with potentially broad effects on a wide range of downstream inflammatory mediators, in rats using a tool trigger targeting rage mRNA, single inhaled doses of 0.5 milligrams per kilogram, induce S-Rage reduction of over 90%, for approximately three months.

In animals rages necessary for activation of airway inflammatory pathways relevant to both type two high end potentially type two low asthma phenotypes.

Further studies that indicated that rage knockout mice are protected from Allergan provoked increases in IL, 33, and <unk>, which represent key upstream drivers of asthmatic type two inflammation.

Thus, we believe a rage inhibition offers the possibility of arresting the most proximal components of airway inflammation in asthma with potentially broad effects on a wide range of downstream inflammatory mediators.

And rats, using a tool trigger targeting rage mrna.

<unk> inhaled doses of 0.5 milligrams per kilograms.

S rates reduction of over 90%.

For approximately three months.

James Hamilton: Like our Mock 5AC program, an abstract has been accepted for oral presentation at ATS this spring, which will summarize preclinical data for our RAGE program. Inhibition of both the MUC5AC and RAGE targets may have clinical utility in severe asthma, COPD, cystic fibrosis, and other mucoobstructive or inflammatory pulmonary conditions. Additional target background.

Like our Mark by the <unk> program, an abstract has been accepted for oral presentation at Ats. This spring, which will summarize preclinical data for our Rage program.

Inhibition of both the muck five AC enrage targets may have clinical utility in severe asthma, COPD cystic fibrosis, and other mutual obstructive or inflammatory pulmonary conditions.

Additional target background data and clinical plans will be discussed in the future as we approach the start of the clinical studies.

James Hamilton: Data and clinical plans will be discussed in the future as we approach the start of the clinical studies. We are also making good progress on two additional respiratory programs that are being developed to address respiratory viruses. One is our COVID program that targets highly conserved sequences in essential viral mRNAs, which may address SARS-CoV-2 and potentially other future coronavirus outbreaks. In a hamster SARS-CoV-2 infection model, our current lead candidate reduced viral load in the lung by 80 percent, reduced histological indices of pulmonary inflammation by 50%, and prevented Body Weight Loss.

We are also making good progress on two additional pulmonary programs that are being developed to address respiratory viruses.

One is our Covid program that targets highly conserved sequences and essential viral mrna is.

Which may address serves Kobe, two and potentially other future Corona virus outbreaks.

And a hamster serves koby to infection model, our current lead candidate reduced viral load in the lung by 80%.

<unk> histological indices pulmonary inflammation by 50%.

And prevented body weight loss.

James Hamilton: We are currently in the lead optimization stage and will provide additional updates when we can. The other is a new program for an undisclosed viral infection. In a mouse model of infection, the current lead compound reduced viral gene expression in the lung by 90% and prevented body weight loss.

We are currently in the lead optimization stage and we'll provide additional updates when we can.

The other is a new program for an undisclosed viral infection.

In a mouse model of infection. The current lead compound reduced viral gene expression in the lung by 90% and prevented body weight loss.

James Hamilton: This is an early program, but we are seeing what we believe are very promising results. Moving to Arrow ENAG. As Chris mentioned, we have decided to focus our resources on next generation candidates. We previously announced that the clinical study was voluntarily paused after findings of local lung inflammation in a rat chronic GOP toxicology study. We have since seen some local inflammatory findings in chronic GOP monkey studies. It is certainly possible that we are overdosing the animals by simply and by simply changing the dose level and or dose intervals, we would see a cleaner tox profile.

This is an early program, but we are seeing what we believe are very promising results.

Moving to <unk> as Chris mentioned, we have decided to focus our resources on next generation candidates.

We previously announced that the clinical study was voluntarily paused after findings of local lung inflammation in Iraq chronic GOP toxicology studies.

We have since seen some local inflammatory findings and chronic GOP monkey studies.

It is certainly possible that we're overdosing the animals by simply and by simply changing the dose level <unk> dose intervals, we would see a cleaner tox profile.

James Hamilton: That could provide a faster path back to the clinic, but we decided that the better long-term path is to focus on next-generation Enoch candidates. We are currently interrogating several next-generation ENET candidates that appear to be substantially more potent than Arrow ENET. It should be noted that the drug exposure levels used in the CTA-enabling GLP studies supporting the new pulmonary programs, including the MUC5AC and RAGE programs, are significantly lower than those used in support of our first-generation ENAC program.

That could provide a faster path back to the clinic, but we decided that the better long term path is to focus on next generation <unk> candidates.

We are currently interrogating several next generation candidates that appeared to be substantially more potent than <unk>.

It should be noted that the drug exposure levels used in the Cta, enabling GOP studies supporting the new pulmonary programs, including the <unk> C and rage programs are significantly lower than those used in support of our first generation program.

James Hamilton: Thus, we expect an ability to use less drug and less frequent dose administration with second generation programs compared to what was used in the Arrow ENAC chronic toxicology studies and anticipate overall enhanced toxicology species safety margins with second generation compounds. The last update I'd like to provide on the pulmonary platform is about future opportunities and the potential to add additional flexibility with regards to route of administration. We've been working on addressing pulmonary tissues via subcutaneous administration.

Thus, we expect an ability to use less drug and less frequent dose administration with second generation programs compared to what was used in the Aero Enoch chronic toxicology.

<unk> studies.

We anticipate overall enhanced toxicology species safety margins with second generation compounds.

The last update I'd like to provide on the pulmonary platform is about future opportunities and the potential to add additional flexibility with regards to route of administration.

We've been working on addressing pulmonary tissues via subcutaneous administration.

James Hamilton: These are still early days, but we have recently generated some very promising preliminary data with the Arrow RAGE program using subcutaneous administration. Again, this is early, but we view this as a potential breakthrough if this line of discovery bears fruit. We intend to provide some data on these efforts when we go into more detail about the Arrow Rage and Arrow Mk5AC candidates, at the appropriate forum.

These are still early days, but we have recently generated some very promising preliminary data with the Arrow Rage program using subcutaneous administration.

Again this is early but we view this as a potential breakthrough if this line of discovery bears fruit.

Intend to provide some data on these efforts when we go into more detail about the Aero rage and Aero multiplied they seek candidates at.

At the appropriate form.

Ken Myszkowski: This will likely take the form of a KOL webinar or an in-person and webcast pulmonary R&D day in the first half of this year. This is all very exciting progress and we look forward to discussing details publicly. I will now turn the call over to Ken Myszkowski. Ken?

This will likely take the form of a KOL webinar or an in person and webcast pulmonary R&D day in the first half of this year.

This is all very exciting progress and we look forward to discussing details publicly.

I will now turn the call over to Ken Moskovsky Ken.

Ken Myszkowski: Thank you, James, and good afternoon, everyone. As we reported today, our net loss for the quarter ended December 31, 2021 was $62.9 million, or $0.60 per share, based on $104.5 million fully diluted weighted average shares outstanding. This compares with a net loss of $20.7 million, or $0.20 per share, based on $102.8 million fully diluted weighted average shares outstanding for the quarter ended December 31, 2020.

Thank you James and good afternoon, everyone.

As we reported today, our net loss for the quarter ended December 31, 2021 was $62 9 million or <unk> 60 per share based on $104 5 million fully diluted weighted average shares outstanding.

This compares with a net loss of $20 7 million or <unk> 20 per share based on $102 8 million fully diluted weighted average shares outstanding for the quarter ended December 31 2020.

Ken Myszkowski: Revenue for the quarter ended December 31st, 2021 was $27.4 million, compared to $21.3 million for the quarter ended December 31st, 2020. Revenue in the current period primarily relates to recognition of a portion of the $300 million upfront payment received under our collaboration agreement with Takeda and the $40 million upfront payment received under our collaboration agreement with Horizon. Revenue for, For each agreement will be recognized as we complete our performance obligations, which include managing the ongoing AAT Phase 2 clinical trials for Takeda and delivering a Phase 1 ready candidate to Horizon.

Revenue for the quarter ended December 31, 2021 was $27 4 million compared to $21 3 million for the quarter ended December 31 2020.

Revenue in the current period, primarily relates to a recognition of a portion of the $300 million upfront payment received under our collaboration agreement with Takeda and the $40 million upfront payment.

<unk> under our collaboration agreement with Horizon.

Okay.

Revenue for.

For each agreement will be recognized as we complete our performance obligations, which include managing the ongoing <unk> phase.

Phase III clinical trials for Takeda and delivering at phase one ready candidate to horizon.

Ken Myszkowski: There remains $188 million of revenue to be recognized associated with the DECADA collaboration, which we anticipate will be recognized over approximately two to three years, and there remains $27 million of revenue for Horizon, which we anticipate will be recognized by the end of calendar 2022. Revenue in the prior period primarily related to the recognition of a portion of the milestones received from our license and collaboration agreements with Janssen. Finally, our license agreement with GSK for Arrow HSD resulted in a $120 million upfront payment to Arrowhead, which was collected in January 2022.

There remains $188 million of revenue to be recognized associated with the Takeda collaboration, which we anticipate will be recognized over approximately two to three years and there remains $27 million of revenue for horizon, which we anticipate will be recognized by the end of calendar 2022.

Revenue in the prior period, primarily related to the recognition of a portion of the milestones received from our license and collaboration agreements with Janssen.

Finally, our license agreement with GSK for Aero HST resulted in a $120 million upfront payment to Arrowhead, which was collected in January 2022.

Ken Myszkowski: We anticipate the majority of this to be recognized as revenue in fiscal second quarter 2022. Any additional milestones achieved from our collaboration agreements would be additive to these amounts. Total operating expenses for the quarter ended December 31st, 2021 were $90.8 million, compared to $45.4 million for the quarter ended December 31st, 2020. This increase is primarily due to increased clinical candidate costs as our pipeline has expanded and advanced through clinical trial stages, as well as increased non-cash stock compensation.

We anticipate the majority of this to be recognized as revenue in fiscal second quarter 2022.

Any additional milestones achieved from our collaboration agreements would be additive to these amounts.

Total operating expenses for the quarter ended December 31, 2021 were $90 8 million compared to $45 4 million for the quarter ended December 31, 2020. This increase is primarily due to increased clinical candidate costs as our pipeline has expanded and advanced through our clinical and <unk>.

Advanced through clinical trial stages as.

As well as increased.

Cash stock compensation costs.

Ken Myszkowski: Net cash used by operating activities during the quarter ended December 31, 2021 was $61.3 million, compared with net cash used by operating activities of $38.9 million during the quarter ended December 31, 2020. Key driver of this change was the increased candidate cost.

Net cash used by operating activities. During the quarter ended December 31, 2021 was $61 3 million compared with net cash used by operating activities of $38 9 million during the quarter ended December 31 2020.

A key driver of this change was the increased candidate costs.

Ken Myszkowski: We continue to estimate our operating cash burden to be $60 to $80 million per quarter in fiscal 2022, including any income incoming milestone payments from our partners. In addition, we are planning to expand our manufacturing capabilities and expand our R&D facilities. We continue to estimate these capital projects, along with routine capital expenditures, will add an incremental cash outlay of $80 to $90 million for full year fiscal 2022. According to our balance sheet, our cash and investments totaled $547.7 million at December 31, 2021, compared to $613.4 million at September 30, 2021. Decrease in our cash and investments was primarily due to cash used for operating activities.

We continue to estimate our operating cash burn to be $60 million to $80 million per quarter in fiscal 2022.

Putting any income incoming milestone payments from our partners.

In addition, we are planning to expand our manufacturing capabilities and expand our R&D facilities.

Continue to estimate these capital projects, along with routine capital expenditures will add an incremental cash outlay of $80 to $90 billion for full year fiscal 2022.

Turning to our balance sheet, our cash and investments totaled $547 7 million at December 31, 2021, compared to $613 4 million at September 30.

'twenty one.

The decrease in our cash and investments was primarily due to cash used for operating activities.

Christopher Anzalone: With the collection of the $120 million upfront payment in January 2022, our current cash and investments total approximately $650 million. Our common shares outstanding at December 31st, 2021 were $104.8 million. With that brief overview, I will now turn the call back to Chris. Thanks, Ken, and thanks to all of you for joining us today. As you've heard, our early pipeline is starting to grow rapidly, our mid and later stage pipeline is advancing on schedule, and we are working hard to continue to expand the reach of our trim platform to enable more growth in the future. These are all critical parts of building a sustainable business and growing shareholder value.

With the collection of the $120 million upfront payment in January 2022, our current cash and investments totaled approximately $650 million.

Our common shares outstanding at December 31, 2021 were $104 8 million.

With that brief overview I will now turn the call back to Chris.

Thanks, Ken and thanks to all of you for joining us today.

As you've heard our early pipeline is starting to grow rapidly our mid and later stage pipeline is advancing on schedule and we are working hard to continue to expand the reach of our trim platform to enable more growth in the future.

These are all critical parts of building, a sustainable business and growing shareholder value.

Christopher Anzalone: I want to take a moment to review what we see on the horizon as potential milestones for the business this year. There's a lot going on, so this list is certainly not exhaustive, but include some of the key events that we will be tracking. I'll start with our partnering program. Arrow AAT also called TAC-999 for Alpha-1 liver disease with Takeda. We expect data from the Sequoia study on reductions in circulating AAT levels and 12-month biopsy data, and we will continue discussions with the FDA. ArrowHSD for NASH with GSK.

I want to take a moment to review what we see on the horizon as potential milestones for the business this year.

There's a lot going on to this list is certainly not exhaustive but include some of the key events that we will be tracking.

Christopher Anzalone: We expect a Phase 2 study to begin this year. Arrow XDH for gout with Horizon. We hope to complete preclinical studies this year. J&J 3989 for HBV with Janssen, We would expect additional clinical readouts from various ongoing studies. J&J 75220795.

I'll start with our partnered programs.

<unk> also called Tech 99, 9% for Alpha one liver disease with Takeda.

We expect data from this study on reduction in circulating <unk> levels, and 12 month biopsy data and we will continue discussions with the FDA.

Aero HST for Nash and Ges with GSK, we expect a phase III study to begin this year.

Aero XD H for gout with Horizon, we hope to complete preclinical studies this year.

J&J $39 89 for HBV with Janssen.

We would expect additional clinical readouts from various ongoing studies.

Christopher Anzalone: For NASH, with Jensen, we expect progress on the Phase 1 study. Opassaran, formerly called AMG 890, for cardiovascular disease with Amgen. Amgen is guided to a phase two study readout this year. I'll now talk about potential milestones for our wholly owned program. Arrow ApoC-3 for hypertriglyceridemia. We expect to fully enroll the Shasta II and MIRROR Phase II studies and make progress toward full enrollment on the Palisade Phase III studies. Arrow and The Reef for mixed dyslipidemia. We plan to fully enroll Arches 2, Phase 2 study, and initiate the Gateway Phase 2 study. Arrow C3 for Complement Mediated Diseases.

J&J 750, <unk> 795 for Nash with Janssen, we expect progress on the phase one study.

All pass our and formerly called AMG 894, cardiovascular disease with Amgen.

<unk> guided to a phase II study readout this year.

Now I'll talk about potential milestones for our wholly owned programs.

Aero Apoc III for hyper triglyceride EMEA.

We expect to fully enroll the shaft, two and mirror phase II studies and make progress towards full enrollment on the palisade phase III study.

Aero and three for mixed Dyslipidemia, we plan to fully enroll arches, two phase III study and initiate the gateway phase II study.

<unk> three for complement mediated diseases, we expect to initiate a phase one study and potentially have and have an initial data readout from our single ascending dose portion of the study in healthy volunteers and initiate the multiple dose portion in various patient populations.

Christopher Anzalone: We expect to initiate a phase one study and potentially have an have an initial data readout from the single ascending dose portion of the study in healthy volunteers and initiate the multiple dose portion in various patient populations. Pulmonary Programs. We plan to file CTAs and initiate clinical studies for Arrow Rage, Arrow MUC5AC, and file a CTA for one additional undisclosed pulmonary program. We also have some early clinical data from the Arrow Rage program.

Pulmonary programs, we plan to file a Cta and initiated clinical studies for Aero Rage, <unk> AC and file a cta for one additional undisclosed pulmonary program.

We also have some early clinical data from the Arrow range program. We also could have some early clinical data from the Arrow range program excuse me <unk>.

Christopher Anzalone: We also could have some early clinical data from the AERO-RAGE program. Arrowhead 2 for renal cell carcinoma. We intend to report additional Phase 1 data at ASCO-GU in February. Arrowdux 4 for FSHD. We plan to file a CTA and initiate a Phase 1-2 clinical study. This is a big year by any measure.

I have two for renal cell carcinoma, we intend to report additional phase one data at <unk> in February <unk>.

<unk> four for Fsh D. We plan to file a cta and initiate a phase <unk> clinical study.

This is a big year by any measure we plan to push for new drug candidates into clinical studies, and possibly a fifth if aero XT eight with horizon makes it this year.

Christopher Anzalone: We plan to push four new drug candidates into clinical studies and possibly a fifth if ArrowXDH with Horizon makes it. We hope to have some data released from six different programs. We hope to fully enroll three Phase 2B studies. Arrowhead has a lot going on and we look forward to numerous opportunities to show progress across the pipeline throughout the coming year. Thank you for joining us today. I would now like to open the call to your questions. Operator?

We hope to have some data released from six different programs, we hope to fully enroll three phase <unk> studies.

Arrowhead is a lot going on and we look forward to numerous opportunities to show progress across the pipeline throughout the coming year.

Thank you for joining us today, and I would now like to open the call to your questions operator.

Operator: Thank you. As a reminder, to ask a question, you'll need to press star 1 on your telephone. To withdraw your question, press the pound key.

Thank you as a reminder to ask a question you will need to press star one on your telephone to withdraw your question press. The pound key we please ask that you limit yourself to one question and one follow up again, we please ask that you limit yourself to one question and one follow up and our first question comes from Madhu Kumar.

Operator: We please ask that you limit yourself to one question and one follow-up. Again, we please ask that you limit yourself to one question and one follow-up. And our first question comes from Adu Kumar from Goldman Sachs. Your line is not open.

From Goldman Sachs. Your line is now open.

Adu Kumar: Yeah, thanks for taking our questions. So, first one on Arrow AAT, maybe we could dig in a little bit on how we should think about the discussions you've had so far and what regulators might need to see from the sequoia circulating AAT data and from the liver biopsy follow-up data.

Yes, thanks for taking our questions. So first one on Aero AP, we begin digging a little bit on how do we should think about the discussions you've had so far and what potentially regulators need to see from the.

Sequoia circulating a T data and from the liver biopsy follow up data.

Yes, yes.

Javier San Martin: So let me first answer the last part of that question with regard to the serum CAAT values. We're looking at that data to really do the dose selection, but of course that's not going to be the only parameter. We have data from liver, Z protein, and of course fibrosis changes, and of course safety as well. So the dose selection we're going to make along with Takeda over the next few months will come out of all that data.

Let me first answer.

Part of that question with regard to the assumed CAH.

Values, we're looking at that data to really do the dose selection, but of course, that's now going to be the only parameter we have data from <unk> protein and of course fibrosis.

Fibrosis changes and of course safety as well so the dose selection.

Along with Takeda that over the next few months, we'll kind of all of that.

Nathan.

Javier San Martin: With regards to conversation with regulatory agencies, I prefer to not get into any details other than we had a very good interaction about a month and a half ago. And under the breakthrough therapy designation, we have planned a number of interactions this year to again, define the phase three study or the registration study that will incorporate of course, those, And I think it's important to point out that, look, this division has not considered, to our knowledge, any other drug candidates against this disease. And so, you know, our first meeting was really to make sure that we're all level set, that we're all on the same page. And you know what, we really are.

With regards to compensation with regulatory agencies preferred too.

Now getting into any details other than that we have a very good introduction of a month and a half ago.

Under the breakthrough therapy designation.

Plan a number of interactions this year too again defined the phase III study or the registration study that will incorporate a of close to those clinics.

And I think it's important to point out that this division has not considered.

To our knowledge.

Any other drug candidates against this disease.

So our first meeting was really to make sure that we're all level set that we're all on the same page and we really are there is there is broad understanding and appreciation for the unmet medical need in this disease is broad appreciation I believe for it from the fact that this appears to be a disease of growing incidence as people are living longer because they are not smoking et cetera.

Javier San Martin: There is broad understanding and appreciation for the unmet medical need of this disease. There's broad appreciation, I believe, you know, for the fact that this appears to be, you know, a disease of growing incidence, as people are living longer because they're not smoking, etc. I think that, you know, the world is starting to see that, you know, while historically this has been viewed as a, you know, as primarily a pulmonary disease and maybe secondarily as a liver disease, as people are living longer, as they're not smoking, I think we're seeing, you know, greater focus on the liver portion of that.

I think.

That the world is starting to see that while historically this has been viewed as it is primarily a pulmonary disease and maybe secondarily hasnt liver disease as people are living longer as they are not smoking I think we are seeing greater.

Greater.

Focused on liver a portion of that so I think that we've been we've been really.

Christopher Anzalone: So I think that, you know, we've been really, we've had a great relationship so far with the FDA. We look forward to taking the next step. Okay, so second question relates to the cardiometabolic field for y'all. So how do you think about the launch of Novartis' Lectio and how that influences how you think about kind of the larger ambitions for drugs like Arrowhead, postucrein, Arrowhead, You know, that's gonna be interesting. As you know, of course, those, Those the Lepio markets are are sort of orthogonal to the markets we're going after.

We've had a great relationship so far with the FDA on this end.

We look forward to taking the next steps.

Okay. So second question relates to the cardio metabolic.

Field for you all so how do you think about the launch of Novartis.

And how that.

Influences, how you would think about kind of the larger ambitions for drugs like Arrow, Apoc, III and the Aero engine.

So that's going to be interesting.

As you know of course those.

<unk>.

The <unk> markets are our sort of our thought and I'll tell you the markets. We're going after there is overlap of course, but but but it's not it's not the same market.

Christopher Anzalone: There is overlap, of course, but it's not the same market. You know, I think that what we've seen there is that what we will see is that there is acceptance for a subcutaneously administered CV drug. Lepio appears to be a good drug. They're clear.

I think that what we've seen there is that.

I think what we will see is that is that there is acceptance for a subcutaneous administered CV drug <unk> appears to be a good drug.

There are clear, there's clearly continues to be unmet medical need there but.

Christopher Anzalone: There's clearly continues to be unmet medical need there. But that's sort of I think, as you know, as you know, as far as as as interpretation will go from from from watching what happens with that launch to to what our expectations are. You know, we're really focused on the markets that we think we can address here for ApoC3. It is it is FCS.

But that's sort of I think is.

As far as as as interpretation will go from from from watching what happens with that launch to what are faced with what our expectations are and what we're really focused on the markets that we think we can address here for <unk> III. It is it is Fcs.

Christopher Anzalone: It is severe hypertriglyceridemic, which which we think is, you know, several million people. The regulatory pathway is clear. The markets are clear and then possibly mixed, mixed, mixed, mixed dyslipidemia. We'll see for ANG3, you know, there there is there is clearly, we think, you know, an opportunity for you for treating those patients who still have have elevated LDL and elevated triglycerides. So, you know, we are we'll be watching the the the Lepio launch.

It is severe hyper triglyceride mix, which we think is several million people.

The regulatory pathway is clear the markets are clear and then possibly mixed mixed dyslipidemia mixed dyslipidemia will see for <unk> III.

There is there is clearly we think an opportunity for for treating those patients who still have have elevated LDL and elevated triglycerides. So.

We will be watching that the bill IPO.

Christopher Anzalone: But I but but I wouldn't say that that that we are dependent upon, you know, a blockbuster launch there to be confident in in the futures of these two drugs. Okay, great. Thank you. And thank you. And our next question comes from Maurice Raycroft from Jeffries. Your line is now open.

Launch, but but but I wouldn't say that.

We are dependent upon a blockbuster launch there to be competent in the futures of these two drugs.

Okay, great. Thank you.

Okay.

And thank you and our next question comes from Maury Raycroft from Jefferies. Your line is now open.

Maurice Raycroft: Hi, thanks for taking my question. I'll do a two part question. So for the two new pulmonary programs announced today, are you using the same approach as ENAC with targeting integrin AB beta 6 on lung epithelial cells? And if so, how consistent or variable is this target in the new indications? And then can you talk more about why the new programs will require less total drugs? Yes, sure.

Hi, Thanks for taking my questions I'll.

I'll do a two part question so.

For the two new pulmonary programs announced today are you using the same approach as inadequate targeting integrin AB <unk> six on lung epithelial cells and if so how consistent are variable is this target in the new indications and then can you talk more about why the new programs will require less total drug.

Okay.

James Hamilton: So the answer to the first part is yes, we're still using the same targeting ligand approach. And there's no reason to believe that that would be any different across those two patient populations, across the various populations that we intend to address with ArrowRage and ArrowMock5AC. So the second part of the question was, why are we confident that we'll be able to use less drug with the new program? Yeah, sure. So I think there's two reasons for that.

Yeah sure. So the answer to the first part is yes, we are still using the same targeting ligand approach and there's no reason to believe that that would be any different across those two patient populations.

Across the various populations that we intend to.

Address with.

Narrow range in air <unk>.

And so the second part of the question was why are we confident that we will be able to use less drug with the new programs.

Yeah sure. So I think there's two reasons for that.

James Hamilton: One is the availability of readily measurable biomarkers for both of those programs for Arrow MUC5AC and Arrow RAGE that will allow us to, I think, better understand where we are in terms of knockdown. That has always been a challenge for ENAC, that there's not a great biomarker to measure. I think the other aspect is that as we've learned more about the pulmonary platform, we have continued to gain an understanding of how much drug we can give and not see a tox signal.

One is the availability of.

Readily measurable biomarkers.

For both of those programs for Aero multiply they see an error rates that will allow us to better understand where we are in terms of knockdown.

That.

Has always been a challenge for us.

Not not a great biomarker to measure I think the other aspect is.

You bet.

As we've learned more about the pulmonary platform.

We have continued to gain an understanding of.

How much drug we can gear.

And Nazi Tox signal, so relative to the dosing regimens, we were using in the <unk> program and if you might remember we were using the 123 cycle.

James Hamilton: So relative to the dosing regimens we were using in the ENAC program, and if you might remember, we were using a day one, two, three cycle in both the clinical program and the, Talks Program. We're confident based on what we've seen that we can dose at lower levels and lower intervals and achieve the same level or better knockdown of the gene target. Yeah, yeah, I think that's I think that's the big take home message that we expect to use substantially less drug and and, Administer it less often with these two drug candidates.

Both the clinical program.

Tox program.

We're confident based on what we've seen that we can.

Those are at lower levels, and lower intervals and achieve the same level.

Or better.

<unk> of the gene target.

Yes, I think that's I think that's the big take a message that we expect to use substantially less drug and and and.

Administer it less often with these two drug candidates and also as James said, we will have we'll have a better idea about about depth and duration of knockdown, we're a bit flying blind with <unk>.

James Hamilton: And also, as James says, you know, we'll have we'll have a better idea about about defenderation of knockdown. We are a bit blind blind with ENAC. And and so we were we were probably in those tox species.

And so we were probably in those tox species product probably.

James Hamilton: We're we're probably we're probably, you know, pushing too much drug in there. And I think we'll have a we'll have a much better time here titrating that in humans as we you know, as we can see what knockdown looks. Got it.

Pushing too much drug in there and I think we'll have a we'll have a much better time here titrate in that <unk>.

<unk> as we as we can see what it looks like.

Got it okay. Thanks for taking my questions.

Welcome.

Ted Tenthoff: Okay. Thanks for taking my questions. And thank you. And our next question comes from Ted Tenthoff from Piper Sandler. Your line is now open.

And thank you.

Our next question comes from Ted <unk> from Piper Sandler Your line is now open.

Christopher Anzalone: Great. Thank you very much. And thanks for all the updates. I want to get a sense for what we should be expecting on HIF-2Alpha at ASCO-GU coming up. Thanks, guys.

Great. Thank you very much and thanks for all the updates I'm wondering kind of sense for what we should be expecting on <unk> Alfa.

<unk> coming up thanks, guys.

Yes.

Christopher Anzalone: Yeah, so that that study is fully enrolled. And all patients are through their second biopsy, their post dose biopsy, or they get biopsy, pre dose and post dose. So we will share an update on, of course, safety, and changes in a resist criteria, as well as, Team Target, Knockdown. So that's... We'll be sharing at ASCOGEU. And the highest dose level, I think, was double from the dose that we had. Presented.

Yes, so that.

That study is fully enrolled.

And.

All patients.

Our through their second biopsy post dose biopsy.

The biopsy pre dose as opposed to so we will share.

An update on of course safety.

And.

<unk> and a resist criteria.

Well as.

Gene target knockdown.

That's what we'll be sharing it with you.

The highest dose level I think it was double from the dose that we had previously presented so this was the highest dose that we intended to go to yes, yes. This will be all three cohorts.

Christopher Anzalone: And so this was the highest dose that we intended to go. Yeah, this will be all three cohorts. And what's the total number of patients? We ended up enrolling 27.

And what's the total number of patients.

We ended up enrolling 27.

Christopher Anzalone: Great. Perfect. Thanks, guys. Looking forward to the data. Thank you. And our next question comes from Mayank Mamtani from B. Riley Securities. Your line is now open. Good afternoon.

Okay perfect. Thanks, guys looking forward to the data.

Yes.

Thank you.

And our next question comes from the ink.

Tommy from B Riley Securities. Your line is now open.

Mayank Mamtani: Thanks for taking our questions and congrats on the progress. So, just maybe if I could clarify on the... On the preclinical work on the rodent and monkey studies for RAGE2 and MUC508, have you conducted the same sort of studies where you saw the signals for ENAC? Did you say that work has already been done? Yes, or is ongoing. Okay.

Good afternoon, Thanks for taking my questions and congrats on the progress so maybe if I could <unk>.

On the preclinical work on the road and in Monkey studies.

Two on mute.

Have you conducted the <unk> study, where you saw the sudden those blog.

Did you say that work has already been done.

Yes or is ongoing.

James Hamilton: And just maybe a follow-up there. Is that information you'd have before you get into the clinic? We would certainly have to have... toxicology studies that support the phase one dosing regimen? So to answer your question, yes. And on the chronic side, Mayank, we have some ideas about what doses would provide what knockdown and over what period of time. But again, here, with RAGE and with MUC5AC, we have the luxury of knowing that in humans.

Okay.

And just maybe a follow up.

What information you would have before you get into the clinic.

We would certainly have to have.

Oxycontin <unk> studies that support.

Phase one dosing regimen.

So to answer your question yes.

And on the on the chronic side Mike.

We have we have some ideas about about what doses would provide.

What knockdown and over what period of time, but again here with rage and with luck by basically we have the luxury of knowing that in humans and so and so we have the luxury of waiting to see what the depth and duration looked like before we.

James Hamilton: And so, you know, we have the luxury of waiting to see what the definition looks like before we design those chronic toxicology studies and make sure that we are not administering substantially more drug than we would in humans. Thank you. And then a financial question I had was about milestones that we could expect this year, and specifically from J&J and Amgen, you know, if they do decide to move into a next study. Two part question, like how much the milestone would be and then the timing of that, if you could remind us, that would be great. Yeah, we can't remind you because we never told you.

Before we design those chronic tox studies and make sure that we are but we are not administering substantially more drug then we would be in humans.

Thank you and then.

Financial question I had was about milestones that we could expect this year.

Typically.

From J&J and Amgen, they do decide to move into our next study.

Two part question like how much will be the milestone and then the timing of that if you could remind us that'd be great.

James Hamilton: The the we are, as you can imagine, Mike, the the, our partners are sensitive about about making those those or can be sensitive about making those milestones too granular. And so we've not been able to say publicly what, you know, what various milestone levels are. And and I apologize, but I really, I don't feel comfortable making giving you guidance on when those could hit because those are, those are J&J and Amgen's program. Understood. Thanks for taking our questions. You're welcome.

Yes, we cant remind you because we never told you.

The.

We are as you can imagine Mike.

Our partners are sensitive about about making those those are can be sensitive about making those milestones too granular and so we've not been able to say publicly what what various milestone levels are and I apologize, but I really I don't feel comfortable giving you guidance on when those could hit because those are those are J&J and amgen's programs at this.

Yeah.

Understood. Thanks for taking my question.

Patrick Trucchio: And thank you. And our next question comes from Patrick Trucchio from H.C. Wainwright. Your line is now open.

And thank you.

And our next question comes from Patrick <unk> from H C. Wainwright. Your line is now open.

Christopher Anzalone: Hi, good afternoon. Just a follow-up on the APOC 3&N programs. I'm wondering if there's a possibility of evaluating these compounds in combination. And secondly, can you tell us your latest thoughts on the potential for partnering these programs and what form that could take? Sure. We are not currently considering combining the two drug candidates.

Hi, Good afternoon, just a follow up on the Apoc III and programs I'm wondering if there is a possibility of evaluating these compounds in a combination treatment.

Secondly, can you tell us your latest thoughts on the potential for partnering these programs on what form that can take.

Sure.

Not currently.

Considering combining combining the two the two drug and we think that could be done but.

Christopher Anzalone: We think that could be done, but we haven't done any non-clinical work by combining them, and we're just not considering, at least right now, clinical work combining them. With respect to partnering, we think, and I don't want to overstate this, but these two drug candidates almost feel like once-in-a-career opportunities. These really do feel to us like drugs.

But we haven't done any any non clinical work by combining them and we're just not considering at least right now clinical or combine them.

We expect to partnering look we think and I don't want to overstate. This but these two drug candidates almost feel like once in a career opportunities. These are these really do feel to us like drugs.

Our data from our phase one two studies where were quite good.

Christopher Anzalone: Our data from the Phase I-II studies were quite good. The markets that these could help to address are clear. The regulatory pathways are clear. These are, we think, important new medicines, and so we intend to hold on to these. Now, these will be expensive, particularly Ang, because we do recognize that Ang is going to require an outcome study, but given where we are now as a company, we are comfortable taking that burden on, given that we think the likelihood of success is high, and these are important. At least right now, we are planning on holding on to these and building a commercial force to sell both drugs eventually. That's helpful. Thank you very much.

The markets that these could help too to address our clear the regulatory pathways are clear.

These are we think important new medicines and so we intend to hold onto these now.

These will be expensive, particularly and because we do we do recognize that Andrew is going to require an outcome study, but given given where we are now as a company. We are comfortable taking that burden on given that we think is likely.

The likelihood of success is high.

And these are important so at least right. Now we are we are planning on holding on to these in building a commercial force to to to sell both drugs eventually.

That's helpful. Thank you very much.

Welcome.

Christopher Anzalone: Welcome, and thank you. And our next question comes from Luca Issi from RBC Capital. Your line is now open.

And thank you.

And our next question comes from Luca <unk> from RBC Capital. Your line is now open.

Luca Issi: Oh, great. Thanks so much for taking my question. Congrats on all the progress. Just a few quick ones.

Oh, great. Thanks, so much for taking my question and congrats on the progress.

Christopher Anzalone: One, maybe circling back on ENAC, it sounds to me that the safety signal that you've seen in RAS was actually replicated in non-human primates. So I'm wondering if you can talk a little bit more about that and why you ultimately decided to switch horses, so to speak, here. And then maybe on A1AT, I want to make sure I'm clear. Is there a scenario where you can possibly file ahead of running a Phase 3, or do you think at this point running a Phase 3 is a must? And then maybe last one, on mixed dyslipidemia, why going after these indications for both H3 and ApoC3 and not maybe prioritizing one versus the other? Thanks so much.

Two quick ones, one maybe circling back on <unk>.

Sounds to me that the safety signal that you've seen in rats was actually replicated in nonhuman primates. So I'm wondering if you can talk a little bit more about that and why you ultimately decided to switch horses. So to speak here and then maybe on <unk> to make sure I'm clear.

Is there a scenario where you can possibly file ahead of running a phase III or do you think at this point running a phase III is a must have.

Last one on mixed Dyslipidemia.

Why going after this indication for both <unk>, three and Apoc, III and not maybe prioritizing one versus the other thanks so much.

Christopher Anzalone: Okay, there's a lot there. So let me start with a T. You know, I don't want to speculate on that.

Sure.

A lot there so let me let me start with <unk>.

You don't want to speculate on that.

We.

We are interacting with the FDA. We've had so far has had a good relationship with them. We will continue to share data with them and have a discussion about what what the fastest and best way to bring this important medicine to these patients is going to be so stay tuned on that we'll let you know as soon as soon as we know what that is with respect to the mixed dyslipidemia and.

Christopher Anzalone: You know, we are interacting with the FDA. So far, we've had a good relationship with them. We will continue to share data with them and have a discussion about what the fastest and best way to bring this important medicine to these patients is going to be. So stay tuned on that. We'll let you know as soon as we know what that is. With respect to mixed dyslipidemia, and both APO and ANG, so let me be clear on that. So first, with ANG, this was always a focus for ANG.

Both April and Ann So let me be clear on that so first with <unk>.

This was always a focus for and given what we saw in the phase one two study given what we saw in non clinical studies and given what we've seen in the <unk> analysis, we know or at least we think we know that this drug is the drug candidate is good at lowering LDL and lowering triglycerides and theres a clear need for that so so we always.

Saw a big opportunity going after that very large market.

Christopher Anzalone: Given what we saw in the Phase 1-2 study, given what we saw in non-clinical studies, and given what we've seen in GWAS analysis, we know, or at least we think we know, that this drug candidate is good at lowering LDL and lowering triglycerides, and there's a clear need for that. So we always saw a big opportunity going after that very large market.

Now with <unk> three we are doing a phase <unk> study in that population, we don't yet know if we're going to do.

An outcome study to address that very large population, but what we wanted was optionality and so we're going to do the phase <unk> study, we're going to see what it looks like and then we can and then and then then if we do decide to do an outcome study would go ahead and do it rather than waiting a couple of years, while we have two phase <unk> study I think that Optionality is important I think it's worth the money.

Christopher Anzalone: We don't yet know if we're going to do an outcome study to address that very large population, but what we wanted was optionality. So we're going to do the Phase 2b study. We're going to see what it looks like, and then if we do decide to do an outcome study, we can go ahead and do it rather than waiting a couple years while we have to do the Phase 2b study. I think that optionality is important.

We are spending on that phase <unk> study now.

Should that come to pass, but we do want to address that same general market with these two drugs I think it's a real benefit to be honest to have those two drugs because I think we're going to learn a heck of a lot in these phase <unk> studies and potentially the phase III studies about how these drugs work and what kinds of patients. They can help and so ultimately we're going to provide.

Christopher Anzalone: I think it's worth the money we're spending on that Phase 2b study. Now, should that come to pass that we do want to address that same general market with these two drugs, I think it's a real benefit, to be honest, to have those two drugs, because I think we're going to learn a heck of a lot in these Phase 2b studies and potentially in Phase 3 studies about how these drugs work and what kinds of patients they can help.

To cardiologists lipid clinics.

Potentially at least.

Tools that they can that they can can use according to their patient's needs and so they can they can really provide specialized personalized healthcare. This is sort of a dream right.

Christopher Anzalone: And so ultimately, we're going to provide to cardiologists and lipid clinics, potentially at least, tools that they can use according to their patients' needs. And so they can really provide specialized, personalized health care. This is sort of the dream, right, of health care. And so having those two tools and using them as they see fit, we think, is a really important thing.

<unk>.

Of healthcare and so having those two tools and using them as they see fit we think is a really important thing.

So we see big opportunity there and also we want to we want to take that market share there may be other.

<unk> three <unk> three inhibitors at some point in the future.

And we see no reason why we shouldnt take as much of that market share as possible.

Christopher Anzalone: So we see a big opportunity there. And also, look, we want to take that market share. There may be other ApoC3 or Ang3 inhibitors at some point in the future, and we see no reason why we shouldn't take as much of that market share as possible. And I'm sorry, what was the first question? In Erik, what did you see in Monkey?

And I'm sorry, what was the first question.

What do you see in monkey.

Christopher Anzalone: Yeah, go ahead. Oh yeah, yeah. Okay, so look, we, you know, I don't want to go too much into that because we don't generally talk about Chilby Tox findings, but we did see some, we didn't see exactly what we saw in rats, but we did see some signs of some local lung inflammation. And as we talked about, you know, what I think was happening is we were just, I think we're giving more drug than we have to, to be honest, you know, this once a day for three days, you know, cycle was, was designed because we wanted to make sure that we had, we had, you know, a pretty wide berth once we see, you know, what defibrillation of the, of the knockdown was. We've learned a lot since then.

Oh, yes, yes.

Okay. So look we don't want to put too much on that because we don't generally talk about about Jimmy talked findings, but we did see some we didn't see exactly what we saw in rats, but we did see some signs of some some are local lung inflammation and as we talked about.

What I think what's happening is we were just I think we're giving more drug then we have to be honest with this once a day for three days cycle.

Was was designed because we wanted to make sure that we had we had a pretty wide berth.

Once we see what different duration of that.

Of the knockdown was we've learned a lot since then and I think that thats.

Christopher Anzalone: And I think that that's probably, that we probably don't require that amount of drug and we probably don't require that frequent of dosing. So it gives us, it gives us confidence that, that for, for RAGE and MUK and potentially, you know, ENAC2, you know, not only do we have, I think, more potent drugs, but we have better understanding about, about how efficient it can be to, to, to deliver the drugs. And so, again, we, you know, you don't know until you know, we don't know until we're in the clinic, but we do feel given, given the data we've got, both clinical and non-clinical, we feel, we feel optimistic at least that, that, that this platform, that these drug candidates will, you know, will, will be well tolerated and, you know, and, you know, important potential drugs. Got it.

Don't require that amount of drug and we probably don't acquire that frequency of dosing. So it gives us it gives us confidence that FERC for rage, and mark and potentially enact too.

Not only do we have I think more potent drugs, but we have a better understanding about about how efficient it can be to deliver the drugs and so again.

You don't know until you know, we don't know until we're in the clinic, but we do feel given given the data we've got both clinical and non clinical we feel we feel optimistic at least.

This platform these drug candidates.

It will be.

Well tolerated and.

And important to.

Important potential drugs.

Got it Super helpful. Thank you Chris.

Okay.

Christopher Anzalone: Super helpful. Thank you, Chris. And thank you. And our next question is from Alethea Young from Kanner Fitzgerald. Your line is now open.

And thank you.

And our next question is from a Lithia young from Cantor Fitzgerald.

Line is now open.

Alethea Young: Hey guys, thanks for taking my question. They're kind of two of the similar types of questions, but, you know, on this pulmonary franchise, it seems like you're kind of branching out potentially into, you know, bigger indications. So I just want to know kind of, you know, how you're thinking about building out a pulmonary business. It's going to be pretty similar to kind of, you know, partnerships and collaborations, or now that you guys are longer, larger, and hopefully, you know, capital markets open up one day, you can get capital and do what you want to do for even big indications. So that kind of just broadens it out to the larger strategic question here.

Hey, guys. Thanks for taking my question.

Two of the somewhat types of questions, but on this pulmonary franchise. It seems like you're kind of branching out potentially.

The bigger indications so I just wanted to kind of.

How youre thinking about building out upon like business is going to be pretty soon.

Similar to kind of partnerships or collaborations or now that you guys are longer are larger and hopefully capital markets open up one day.

Given the capital and do what you want to do great and big indications.

Christopher Anzalone: You have a lot of programs, you have a lot of collaborations, you know, you're moving forward in many different ways. And I just want to know if the strategy is the same, or do you guys think about keeping more of your, you know, kind of core assets in house? And do you also think about kind of building with bigger potentially, you know, I'll be at commercial opportunities where it may take a bigger investment on, you know, your expense side, but, you know, something that could yield like, you know, much bigger opportunities too.

I would just broaden it out to the larger strategic question here you have a lot of program.

The collaboration.

You're moving forward in many different ways and I just want to know if the strategy of the same R&D guys think about keeping more of your company.

A couple of core assets and how often do you also think about kind of building with bigger potentially albeit commercial opportunities where it may take a bigger investment.

Your expense side, but that's something that could yield like.

Bigger opportunities too thanks.

Christopher Anzalone: Thank you. Right, sure. Thanks, Lucia.

Sure. Thanks Alicia.

Christopher Anzalone: You know, it's still early with pulmonary, but we like the space and we like the idea of building out a commercial for pulmonary. I think there are around 16,000 pulmonologists in the U.S. And when we look at that, when we look at what we think our pulmonary platform can do, we don't see two or three drugs. We see, you know, eight or nine drugs. And so we like the idea of building out a sales force to address those 16,000 pulmonologists who have eight or nine drugs in the bag. That's an efficient way, I think, to build a commercial force.

It's still early with pulmonary but but we like the space and we like the idea of building out commercial for pulmonary I think they are around 16000 pulmonologists in the U S and when we look at that when we look at what we think our pulmonary platform can do we don't see two or three drugs, we see eight or nine drugs.

So we like the idea of building that sales force to address those 16000 pulmonologists.

We will have eight or nine drugs in the bag, that's an efficient way I think to build a commercial force. So so right now we like the idea of holding on to those to those assets.

Christopher Anzalone: So right now, we like the idea of holding on to those assets. Look, the lung is a target rich environment. And so it is certainly conceivable that enough targets will come up that we may want to partner one here or there. But strategically, that's how we're thinking about it.

The lung is a target rich environment, and so and so it is certainly conceivable that enough targets will come up that we may want to partner one here or there.

But just strategically that's how we're thinking about it.

Christopher Anzalone: You know, you've heard us talk about this before, that if we're going to build a company that I think that we should be building, we need to have, you know, a large, a relatively large number of important drugs that we commercialize ourselves. And so we're, you know, we're cognizant of that. We're not going to over-partner.

You've heard us talk about this before that that if we're going to build the company that I think that we should be building.

Need to have.

Large relatively large number of important drugs that we commercialize ourselves. So we're cognizant of that we're not going to over partner we partner.

Christopher Anzalone: We partner, you know, in order to, you know, get drugs to patients that we can't get them to very well, and B, to provide us with capital so we can afford to run our own programs. And we'll continue to use that partnering strategy, you know, in that kind of way. Alright. I appreciate that.

In order to to a get drugs to patients that we can't get them to very well and b to provide us capital. So we can we can afford to to to run our own programs and we'll continue to use that partners strategy.

In that kind of way.

Alright, I appreciate that.

Welcome.

Thank you.

Christopher Anzalone: Thank you. And our next question comes from Joel Beattie from Baird. Your line is now open.

And our next question comes from Joel Beatty from Baird. Your line is now open.

Joel Beattie: Hi, congrats on the progress and thanks for taking the question. First question is on ArrowRage. How close is the relationship between the circulating OstrAge biomarker and activity in the lungs to be able to really help with pinpointing the dose, Yeah, so the S-RAGE comes from two different origins. It's a splice variant that is secreted, or it's cleaved off of the actual RAGE receptor. It's a transmembrane receptor.

Hi, congrats on the progress.

Thanks for taking the question first question is on Aero Rage, how close is the relationship between the circulating <unk> biomarker and activity in the lungs to be able to really help with pinpointing the dosing.

Okay.

Yes.

The S rage comes from two different origins.

<unk> variant.

That is accreted or it's cleaved off of the actual range of receptor.

James Hamilton: So by measuring the S-RAGE, we should have a very good idea of what the knockdown of that receptor is. I hope that answers your question. Yeah, thanks.

The transmembrane receptor so by.

By measuring the S range, we should have a very good idea of what knockdown of that receptor is.

I hope that answers your question.

James Hamilton: And as a follow up, how closely behind could the subcutaneous lung programs be to the lung administered program? Too early to tell on that, you know, these are early programs and we're excited about it because, again, if we can make this thing work and make it scalable, you know, it's a real breakthrough. And so, so it's a real focus of ours. We're not quite there yet. So it's hard to tell how, you know, how far away we are.

Yes.

As a follow up.

Closely behind could.

Subcutaneous lung program speed to the lung.

<unk> administered programs.

It's too early to tell.

On that.

These are early programs and we are excited about it because again, if we can make this thing work and make it scalable.

It's a real breakthrough and so so.

James Hamilton: I do expect that we will do, you know, we'll see what COVID looks like. Hopefully an in-person, you know, pulmonary focused R&D day or at least a webinar. At that point, I think that we'll be able to share some of our data. Again, we're excited about it, but we're still working. Great, thank you. Thank you. And our next question comes from Mani Foroohar from FVB Lyric. Your line is now open.

It's a real focus of ours, we're not quite there yet.

So it's hard to tell how how far away we are.

Do expect that we will do.

We will see what color it looks like but hopefully an in person pulmonary focused R&D day or at least a webinar at that point.

I think that the wheel will be able to share some of our data.

Again, it's we're excited about it but but but we're still working on it.

Great. Thank you.

Thank you.

And our next question comes from.

Manny <unk> from <unk> Leerink. Your line is now open.

Mani Foroohar: Thanks, guys. So I'm digging through this AngPTL-3 data from Ionis, which we also cover. They have previously shown a 62 percent knockdown with their 80 milligram dose. We don't actually know what the 320 milligram phase 2B knockdown really looks like. We haven't seen the full data yet. But with you guys at 300, you struck 88% knockdown.

Thanks Scott.

Digging through this <unk> III data from our owners, which we also cover.

They have previously shown 62% knockdown with the 80 milligram dose we don't actually know what the 320 milligram phase to be knocked down really look like we haven't seen a full data.

With you guys at $300 or 88% knockdown subtle nuances around dosing, obviously in terms of frequency et cetera.

James Hamilton: Subtle nuances around dosing, obviously, in terms of frequency, etc. Given the commentary from Pfizer that suggests that perhaps, despite seeing impressive knockdown, they hadn't seen that translate.., to Reproducing the Level of Clinical Benefits on Triglycerides, Non-HDLC, etc. Are there specific data sets that you guys look at that suggest the knockdown that you're seeing will translate to those clinical benefits when they did not in the larger clinical trial advisership? And I have a quick follow-up.

Given the commentary from Pfizer suggest that perhaps despite seeing impressive knockdown they hadn't seen that translate.

To reproducing the level of clinical benefit on triglyceride, non HDL C et cetera.

Are there specific data set that you guys look at that suggest the knockdown that you're seeing will translate to those clinical benefits when they did not in the larger clinical trial with Pfizer show and I have a quick follow up.

James Hamilton: Well, we have what we presented the LDL and non-HDL data and triglycerides data with that level of knockdown in the 80 to 90% range from the 200 and 300 milligrams dose. So the non-HDL and LDL data is clearly superior to what Ionis has presented in the past, but we don't know what is this current data exactly. So we do believe that there is at least three different sources that speak to the correlation between the level of knockdown or the level of suppression of HPTL3 and the pharmacodynamic effect.

Well, we have what we presented the LDL and non HDL data and preclinical data with that level of knockdown in the 80% to 90% range from the 200 300 meter.

Does the <unk>.

Non HDL and LDL data is clearly superior to what I only have presented in the past, but we don't know.

Current data exactly so and we do believe that is at least three different services to.

To the correlation between the level of knockdown of the level of suppression of HPT agree on the Pharmacodynamic effect that she was.

James Hamilton: The GWAS study, the Regeneron data, and the comparison so far between the Ionis and our data. If you look at the Regeneron data, they do need to dose. Really high to get to the level of suppression to achieve the pharmacodynamic effect.

Study the agenda on data and the comparison so far between the I only said that data. If you look at the agenda on the date that they do need to those really high to get to a level sufficient to achieve the pharmacodynamic effect and we did see a dose response in our case as well and again as I said that she was telling you.

James Hamilton: And we did see those response in our case as well. And again, as I said, the G was studied the differentiation between the heterocides, the composite was quite clear. So I think this is a target where the magnitude of the target suppression correlated with the clinical or the pharmacodena. Yeah, and I think, so if you look, again, it's very difficult to compare these because we haven't seen their data really. And there's these two separate studies.

The differentiation between the hit get assignments I almost I was quite clear. So I think this is the target with the magnitude of its target sufficient correlate with the clinical or the pharmacodynamic effects.

James Hamilton: But, but you know, you look at at their dosing once every two weeks, or once every month, or dosing every quarter, and potentially less for, Second, you look at ALT increases. We had two patients with ALT increases, and we think we know why that was. We think it was related to other medications those two patients were on. So we think that that's different. Third, we haven't seen increases in liver fat. It sounds like they did.

And I think so if you look again, it's very difficult to compare these because we haven't seen their data really and these two separate studies, but but youll look at at their dosing. Once every two weeks or once every month, we're dosing every quarter and potentially less frequently.

Second you can.

Looking at <unk> increases, we had two patients with ELT increases and we think we know why that was so we think it was related to other medications. Those those two patients were on so we think that that's different.

Third we haven't seen increases in liver fat it sounds like they did.

James Hamilton: And so I think this is a good example, broadly, of the advantages of RNAi over antisense. I think whenever you can compare those two modalities, RNAi leads to deeper and more durable knockdown. The safety profile, you know, if the sequences are chosen correctly, can also be favorable. So we feel great about the candidate.

And so I think this is I think this is a good example, broadly of the advantages of <unk> over antisense I think I think whenever you can compare those two modalities.

<unk> is is it leads to deeper and more durable knockdown safety profile.

If the sequences are chosen correctly.

Can also be favorable so look we feel great about that about the candidate we still feel great about the target.

James Hamilton: We still feel great about the target, as Javier points out, because the GWAS data, as well as other data. Yeah, so that makes sense to me. But what I was trying, what I'm trying to understand, so the, what we have is limited to a press release, obviously, from Pfizer, in a formal event, the commentary around what they saw as, you know, clinically justifying going into a large complex phase three, how do you think about what your threshold would be?

As Javier points up get the Geos data as well as other data.

Yeah. So it makes sense to me.

But what I was trying what I'm trying to understand so the what we have is limited to a press release, obviously from Pfizer.

The formal events the commentary around what they saw.

Clinically justifying going into a large complex phase III, how do you think about what your threshold would be.

James Hamilton: Around what would be a number that justifies going into phase three in a broad patient population as opposed to something like a more narrow and niche defined population. Like what are the specifics do you think the numbers that you previously showed are adequate or do you think pursuing a higher, deeper, more aggressive knockdown even though what you've seen so far isn't? Look, we'll see.

What would be a number that justify going into phase III in a broad patient population as opposed to doing something like a more of a more narrow and bitchy defined population.

Like what are the specific the number that you previously sort of adequate or do you think pursuing higher deeper more aggressive knockdown, even though what you've seen so far is necessary.

James Hamilton: We'll take a look at our Phase 2b data. You know, we've seen LDL reduction of as much as 50%, you know, mean reduction as much as 50%. You know, we've seen, we've seen, you know, triglyceride reduction, you know, and I think in the 70 or so percent range, something like that. You know, those are substantial. Now, we're not going to see clinical outcomes, you know, in a short study. And so I don't, so, you know, we're dependent upon these surrogate endpoints. But I think those are, I think those are substantial.

We'll see we'll see we'll take a look at our phase <unk> data, we've seen LDL reduction of as much as 50% mean reduction by as much as 50, 50% we've seen we've seen.

Triglyceride reduction and I think in the 70 years or so percent range something like that.

Those are those are substantial now we're not going to see clinical outcomes in a short study and so so so.

We're dependent upon the surrogate endpoint, but I think those are I think those are substantial you look around at other triglyceride lowering agents and theres just not much out there.

James Hamilton: You know, you look around at other triglyceride-lowering agents, and there's just not much out there, you know. And I think that if our data, put it this way, I think if our data continue to roll out the way we've seen them so far in the Phase 1-2 study, I think that would give us good confidence to go into an outcome study. Great, that makes sense to me. Thanks for taking the questions, guys. You're welcome.

And I think that.

If our data this way I think of our data continue to.

Rollout the way we've seen them so far in the phase one two study I think that that would be that that would give us good confidence to go into a into a an outcome study.

Great that makes sense to me thanks.

Thanks, taking my questions guys.

Welcome.

Keay Nakae: Thank you. And our next question comes from Keay Nakae from Chardon. Your line is now open.

Thank you and our next question comes from key Mackay from Chardan.

Line is now open.

James Hamilton: Yes, thank you. Two questions. First, please add SubQ Admin to the loan.

Yes. Thank you two questions first sub Q admin to the lung are you using the same.

Keay Nakae: Are you using the same, Conjugate targeting ligand for integrin? Are you evaluating something different? And is the primary performance objective a better safety profile? Yeah, so so I can't answer the first question, because because we are, you know, we're, we are playing around with with various, various ways to do this.

Conjugate targeting law again integrin are you evaluating something different and is the primary performance objective a better safety profile.

James Hamilton: And so, you know, hold off. And when we when we present, we can we can talk more about it. So, so I wouldn't say that we're looking for a better safety profile. That's a good question. It's not, it's not as though we're afraid of the inhaled route. But it just makes our life simpler, right?

Yes.

So so I can answer the first question because because we are.

We are playing around with various.

Various ways to do this and so hold off and when we when we present, we can we can talk more about it.

So so I wouldn't say that we're looking for a better safety profile.

It's a good question it's not.

Not as though we are afraid of the inhaled route but it just makes our lives simpler right.

If we can administer this via sub Q.

James Hamilton: You know, if we can administer this via sub queue, there are there are, you know, unknowable questions that you don't have any longer about about, or unanswerable questions that we don't have anymore, with respect to, to, to a safety profiling talks in talks animals. And so it does make our lives easier. But also look, it's, it's an easier mode of administration for for, for potentially, you know, all indications, you know, rather than using a nebulizer, which which is still relatively light touch, but still requires having having a machine and, and require some time.

There are there are unknowable questions, but you don't have any longer about about.

Unanswerable questions that we don't have any more with respect to safety profiling talks and talks of animals and so it does make our lives easier, but also look at.

It's.

It's an easier motive administration for four.

James Hamilton: That's just more cumbersome than a simple sub q injection. That could be, you know, once every two weeks, once a month, once every three months, whatever that's going to be. That's just a more convenient mode of administration.

Or potentially all indications rather than using a nebulizer, which which is still relatively light touch, but still requires having them having a machine and requires some time, that's just more cumbersome than a simple sub Q injection that could be who knows once every two weeks once a month. Once every three months whenever that's going to be not just a more.

Convenient mode of administration, we think that that that would be just a massive breakthrough.

This field and again I don't want to oversell, it because we're not there yet, but we but what we've seen so far has told us that we want to continue to explore this.

James Hamilton: We think that that that would be just a massive breakthrough in this field. And again, I don't want to oversell it because we're not there yet. But we but what we've seen so far, has told us that we want to continue to explore. Okay, great. And just clarification on the upfront from GSK, the 120 million received in January. How much of that will be recognized as revenue and fiscal Q2 and how much might be amortized over some period of time. Thanks. Sorry, can you repeat that?

Okay, Great and just a clarification on.

Upfront from GSK. The 120 million we received in January how much of that will be recognized as revenue in fiscal Q2, and how much might be amortized over some period of time.

Sorry can you repeat that.

Keay Nakae: The $120 million upfront from GSK received in January. The $120 million upfront from GSK received in January. How much will be recognized as revenue in fiscal Q2 versus how much might be amortized in a period of time?

The $120 million upfront from GSK received in January .

How much will be recognized as revenue in fiscal Q2 versus how much might be amortized okay.

Jim.

Ken Myszkowski: probably all of it will be recognized in fiscal Q2. Our performance obligations are basically complete for that for that milestone that we received. Okay, great. Thank you. Thank you. And thank you. And I am showing no further questions.

Probably all of it will be recognized in fiscal Q2, our performance obligations are basically complete for that.

For that.

Milestone that we received.

Okay, great. Thank you.

Thank you.

Christopher Anzalone: I would now like to turn the call back over to Chris Anzalone for closing remarks. Thanks very much for joining us today. It's always a pleasure to speak with you and we look forward to talking to you next quarter. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect. Thank you for watching!

And thank you and I am showing no further questions I would now like to turn the call back over to Chris Anzalone for Clos.

<unk> remarks.

Thank you very much for joining us today, it's always a pleasure to speak with you. When we look forward to talking to you next quarter.

Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.

[music].

[music].

Operator: .. .. .. .. .. .. .. .. .. .. .. .. .. ... [music] [inaudible] E. E. E. E. E. [music] Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call. Throughout today's recorded presentation, all participants will be in a listen-only mode.

[music].

Vincent Anzalone: After the presentation, there will be an opportunity to ask questions. I will now hand the conference call over to Vincent Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead. Justin, good afternoon, everyone.

Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call throughout todays recorded presentation, all participants will be in a listen only mode.

After the presentation there'll be an opportunity to ask questions I will now hand, the conference call over to Vincent Anzalone, Vice President Investor Relations for Arrowhead. Please.

Please go ahead.

Vincent Anzalone: Thank you for joining us today to discuss Arrowhead's results for its fiscal 2022 first quarter ended December 31st, 2021. With us today for management are President and CEO Dr. Christopher Anzalone, who will provide an overview of the quarter. Dr. Javier San Martin, our Chief Medical Officer, who will provide an update, will provide an update on our mid and later stage clinical pipeline. Dr. James Hamilton, our Senior Vice President of Discovery and Translational Medicine, will provide an update on our pulmonary platform and Ken Myszkowski, our Chief Financial Officer, will give a review of the financial.

Justin Good afternoon, everyone. Thank you for joining us today to discuss arrowheads results for its fiscal 2022 first quarter ended December 31, 2021 with US today from management are president and CEO , Dr. Christopher Anzalone, who will provide an overview of the quarter Dr. Javier.

And Marty <unk>, our Chief Medical Officer, who will provide an update we'll provide an update on our mid and later stage clinical pipeline Dr. James Hamilton, Our senior Vice President of Discovery and translational medicine will provide an update on our pulmonary platform and Ken Moskovsky, Our Chief Financial Officer will give a review of the financials. We will then open.

The call to your questions before we begin I would like to remind you that comments made during today's call contains certain forward looking statements within the meaning of section 27 of the Securities Act of $19 33, and section 21 E of the Securities Exchange Act of 1934, all statements other than statements of historical fact.

Vincent Anzalone: We will then open up the call to your questions. Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical fact, are forward-looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statement.

Vincent Anzalone: For further details concerning these risks and uncertainties, please refer to our SEC filings, including our most recent annual report on Form 10-K. That said, I'd like to turn the call over to Christopher Anzalone, President and CEO of The Cup, Chris. Thanks, Ben. Good afternoon, everyone, and thank you for joining us today.

Our forward looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward looking statements.

For further details concerning these risks and uncertainties. Please refer to our SEC filings, including our most recent annual report on Form 10-K .

That said I would like to turn the call over to Christopher Anzalone, President and CEO of the company Chris.

Thanks, Vince and.

Christopher Anzalone: The biotech market has been a difficult place of late. In 2021, the XBI biotech index was down 21%, and during the first month of 2022, the index was down a further 18%. My goal today is not to fight market cycles, but rather to articulate where we are as a company to help you assess Arrowhead's true value. We are here to create innovative new medicines for the millions of patients who desperately need them. And if we stay focused on that important mission, we will continue to create substantial value for our shareholders.

Good afternoon, everyone and thank you for joining us today.

The biotech market has been a difficult place of late in 2021, the Spi biotech index was down 21% and during the first month of 2022, the index was down a further 18%.

My goal today is not despite market cycles, but rather to articulate where we are as a company to help you assess arrowheads true value.

Year to create innovative new medicines for the millions of patients who desperately need them and if we stay focused on that important mission, we will continue to create substantial value for our shareholders.

Christopher Anzalone: That is the lens through which you should view our update today. As Javier, James, and I speak about our continued progress across our programs, think about what those programs will mean to patients. I think about what those programs will mean to patients and where those programs will take us as a company. There is much that currently excites me about this great company.

That is the lens through which you should view our update today.

As Javier James and I speak about our continued progress across our programs think about what those programs will mean to patients.

I think about what those programs will mean to patients and where those programs will take us as a company.

There is much the currently excites me about this great company.

Christopher Anzalone: We had another strong quarter executing on our strategy with respect to platform extension, pipeline expansion, and business development. We continue to make tangible progress across all our programs. Early in the quarter, we hosted a Key Opinion Leader webinar on Arrow C3, our newest clinical stage investigational therapeutic designed to reduce production of complement components 3, or C3, as a potential therapy for various complement-mediated diseases. We also filed a CTA to begin clinical studies and have been activating sites for FIRST in human studies.

We had another strong quarter executing on our strategy with respect to platform extension pipeline expansion and business development, we continue to make tangible progress across all of our programs.

Early in the quarter, we hosted a key opinion leader webinar on <unk> three our newest clinical stage investigational therapeutic designed to reduce production of complement components, three or <unk> as a potential therapy for various complement mediated diseases.

We also filed a cta to begin clinical studies and have been activating sites for first in human studies.

Christopher Anzalone: As with all other drug candidates currently in our pipeline, we expect Arrow C3 to be the first RNAi candidate against this target to reach the clinic. We see substantial unmet medical need we could address across a variety of indications, including PNH, autoimmune hemolytic anemia, C3 glomerulopathy, IgA nephropathy, and lupus nephritis. Our preclinical data have been encouraging, and given that this will be our eighth hepatocyte-directed trim candidate in clinical studies, we have a high expectation of success. This program is also a good example of our speed.

As with all other drug candidates currently our pipeline, we expect <unk> to be the first RNA candidate against this target to reach the clinic we.

We see substantial unmet medical need we could address across a variety of indications, including <unk> autoimmune hemolytic anemia seek their eaglin, merial apathy, Iga nephropathy and lupus nephritis.

Our preclinical data has been encouraging and given that this will be our eighth hepatocytes directed trim candidate in clinical studies, we have a high expectation of success.

This program is also a good example of our speed we went from idea to initiating clinical studies in approximately 12 months, we expect to move its similar speed for future pad site director candidates and as the extra hepatic platforms mature we have the potential to move at a similar level of efficiency.

Christopher Anzalone: We went from idea to initiating clinical studies in approximately 12 months. We expect to move at similar speed for future hepatocyte-directed candidates. And as the extra hepatic platforms mature, we have the potential to move at a similar level of efficiency. During the quarter, we and our partners also presented encouraging clinical data on multiple programs, including Arrow HSD for NASH, Arrow AAT, also called TAC-999, for liver disease associated with alpha-1 antitrypsin deficiency.

During the quarter, we and our partners also presented encouraging clinical data on multiple programs, including Aero HST for Nash <unk> also called Tak 999 for liver disease associated with Alpha one antitrypsin deficiency.

Christopher Anzalone: A plus C 3 for hypertriglyceridemia and J and J 39 89 for hepatitis B virus infection. Without exception, all of those candidates appear to be doing what they are designed to do, and have been generally well tolerated.

<unk> three for hyper triglyceride, EMEA and J&J $39 89 per hepatitis B virus infection.

Without exception all of those candidates appear to be doing what they're designed to do and have been generally well tolerated.

Christopher Anzalone: We look forward to continued clinical development and learning more about the potential disease-modifying capabilities of those agencies. We also signed a license agreement with GlaxoSmithKline for Arrow HSD that just recently closed. We are happy to bring on a new partner and look forward to working closely with GSK as they prepare to start a Phase II study. Under the terms of the agreement, GSK received an exclusive license to develop and commercialize Arrow HSD in all territories except Greater China, which was retained by Arrowhead.

We look forward to continued clinical development and learning more about the potential disease modifying capabilities of those agents.

We also signed a license agreement with Glaxo Smith Smithkline for Aero HST that just recently closed we're happy to bring on a new partner and look forward to working closely with GSK as they prepare to start a phase II study.

Under the terms of the agreement GSK received an exclusive license to develop and commercialize arrow HST in all territories, except greater China, which was retained by arrowhead.

Christopher Anzalone: Arrowhead received an upfront payment of $120 million and is eligible for a $30 million milestone at the start of Phase 2. $100 million milestone at the start of Phase 3, up to $190 million in milestones at launch in the U.S. in major markets, and up to $590 million for key sales milestones. Arrowhead is further eligible to receive tiered royalties of mid double digit to 20% on net product sales.

<unk> received an upfront payment of $120 million.

And is eligible for a $30 million milestone at the start of phase III.

Hundred million dollars milestone at the start of phase III up to $190 million in milestones at launch in the U S in major markets and up to $590 million for key sales milestones.

Arrowhead is further eligible to receive tiered royalties of mid double digit to 20% on net product sales.

Christopher Anzalone: I expect GSK to be a great partner for this exciting, genetically validated candidate. They have a clear commitment to genetic medicine and to finding an effective treatment for NASH, which could include a staggering number of patients. Understanding the complicated biology of the, and addressing a potentially very large global market are substantial challenges indeed.

I expect GSK to be a great partner for this exciting genetically validated candidate.

We have a clear commitment to Jack to genetic medicine, and defining an effective treatment for Nash, which could include a staggering number of patients.

Understanding the complicated biology of this disease and addressing a potentially very large global market are substantial challenges indeed, and we believe that GSK will be a powerful partner to complete clinical development and ultimately deliver a potentially important medicine to the tens of millions of patients who need it.

Christopher Anzalone: And we believe that GSK will be a powerful partner to complete clinical development and ultimately deliver a potentially important medicine to the tens of millions of patients who need it. Moving to our cardiometabolic programs, we recently initiated Arrowhead's first Phase 3 study, which I see as a key milestone event and indicative of a maturing company. The Palisade study is a Phase 3 clinical study to evaluate the efficacy and safety of Arrow ApoC3 in adults with familial chylomicronemia syndrome, or FCS. Arrow ApoC-3 is our investigational RNAi therapeutic designed to inhibit the production of apolipoprotein C-3, or ApoC-3, a key regulator of triglyceride metabolism.

Moving to our cardio metabolic programs. We recently initiated arrowheads first phase III study, which I see as a key milestone event and indicative of a maturing company.

The palisade study is a phase III clinical study to evaluate the efficacy and safety of <unk> three in adults with familial chylomicron anemia syndrome or Fcs.

Aero Apoc III is our investigational already high therapeutic designed to inhibit the production of April lipoproteins, <unk>, three or <unk>, three a key regulator of triglyceride and metabolism.

Christopher Anzalone: Prior studies have been very encouraging, where we have seen greater than 90% triglyceride reduction in some patient populations. This type of dramatic effect could really move the needle for FCS patients who have very little in the way of therapeutic options at present. We also made good progress on patient enrollment for the two Arrow ApoC3 Phase 2B studies in severe hypertriglyceridemic patients, the Shasta 2 study, and those with mixed dyslipidemia, the MURE study.

Prior studies have been very encouraging where we have seen greater than 90% triglyceride reduction in some patient populations.

This type of dramatic effect could really move the needle for FCS patients, who have very little in a way of therapeutic options at present.

We also made good progress on patient enrollment for the two arrow Apoc III phase III <unk> studies in severe hyper triglyceride image patients the shaft. The shafts two study and those with mixed Dyslipidemia the mirror study.

Christopher Anzalone: These are populations that we believe have few therapeutic options, and data from our prior studies suggest that Arrow ApoC3 could be highly meaningful by lowering triglycerides and raising HDL. Progress on the Arrow Ants 3 Phase 2B study in mixed dyslipidemia, the Arches 2 study, has been rapid, and I expect enrollment to be complete in the coming months. We continue to see a big opportunity to help the millions of patients with elevated triglycerides and LDL cholesterol, and we are optimistic that Arrow ANG3 could be an important future medicine, given our prior data and exciting work done by others to validate the target.

These are populations that we believe have few therapeutic options and data from our prior studies suggest that <unk> could be highly meaningful by lowering triglycerides and raising HDL.

Progress on the Aero and three phase <unk> study in mixed.

Mixed dyslipidemia the arches, two study has been rapid and I expect enrollment to be complete in the coming months.

We continue to see a big opportunity to help millions of patients with elevated triglycerides and LDL cholesterol and we are optimistic that <unk> could be an important future medicine, given our prior data and exciting work done by others to validate the target.

Christopher Anzalone: As has been our consistent practice at Arrowhead of bringing the first RNA I compound into the clinic against specific gene targets. Arrow Ang 3 was the first RNA I compound in clinical studies that targets Ang PTL 3.

As has been our consistent practice at arrowhead or bringing the first RNA icon impound into the clinic against specific gene targets <unk> three was the first Arnie I compound in clinical studies, the targets and <unk> III.

Christopher Anzalone: Further, the competitive landscape seems to have shifted even further in our favor, with the recent announcement that Pfizer has discontinued its partnership with Ionis on its antisense approach to Ang ptL. Of course, we do not have deep knowledge of data coming out of that program, and it is always difficult to compare results across different studies. But given what we have seen publicly, we continue to be confident in our candidates. For instance, data from our Phase 1-2 study indicated the following.

Further the competitive landscape seems to have shifted even further in our favor with the recent announcement that Pfizer has discontinued its partnership with <unk> on its antisense approach to <unk> III.

Of course, we do not have deep knowledge of data coming out of that program and it is always difficult to compare results across different studies, but given what we have seen publicly we continue to be confident in our candidates.

For instance data from our phase one two study indicated indicated the following.

Christopher Anzalone: Arrowhange 3 has demonstrated very deep and durable activity, enabling quarterly or less frequent dosing. Ang-PTL-3 levels were reduced in a dose-dependent fashion from 78 to 90 percent after 100, 200, or 300 milligrams of Arrow Ang-3. We saw mean triglyceride reductions of up to 73.5% and mean non-HDL cholesterol reductions of up to 50%. Only two patients had elevated ALTs, and in both cases, there were concomitant medications associated with increases in ALTs, and in both cases, the elevation was transient and not associated with increases in bilirubin.

<unk> has demonstrated very deep and durable activity and enabling quarterly or less frequent dosing.

<unk> III levels were reduced in a dose dependent fashion from 78% to 90%. After 100, 200 or 300 milligrams of <unk> III we.

We saw a mean triglyceride reductions up to 73, 5% and non HDL cholesterol reductions up to 50%.

Only two patients had elevated <unk> and in both cases, they were concomitant medications associated with increases in <unk> and in both cases, the elevation was transient and not associated with increases in bilirubin.

Christopher Anzalone: And we have seen no indication that Arrowhands 3 led to any increase in liver fat. Let's now move to our pulmonary plastic. James will give a fuller review during this call, but I wanted to highlight a few developments. First, we continue to make progress on the ENAC target, but will likely not continue with Arrow ENAC, the candidate that we were testing in a Phase 1-2 study last year. We have two to three next generation compounds that appear to have favorable pharmacologic properties compared to Arrowhead.

And we have seen no indication that arrow and three led to any increase in liver fat.

Let's now move to our pulmonary platform James will give a fuller review during this call, but I wanted to highlight a few developments first we continue to make progress on the <unk> target, but will likely not continue with arrow enact the candidate that we are testing in a phase one two study last year.

We have two to three next generation compounds that appear to have favorable pharmacologic properties compared to Aero NEC <unk>.

Christopher Anzalone: And a step behind this, we are also exploring ways to deliver pulmonary targeted drug candidates via subcutaneous administration, which we believe would be a true breakthrough, and are testing this for ENAC as well. We are likely changing horses in the ENAC program, but we have not yet settled on which new horse.

A step behind US we are also exploring ways to deliver pulmonary targeted drug candidates via subcutaneous administration, which we believe would be a true breakthrough and are testing this for <unk> as well.

So we're likely changing horses in the <unk> program, but we have not yet settled on which new horse.

Christopher Anzalone: We've also discussed our plans to file two new pulmonary CTAs this year, but we had not previously disclosed the targets or disease areas. I'm excited to announce these programs formally as Arrow RAGE and Arrow MUC5AC, each being developed for various mucoobstructive and inflammatory pulmonary conditions.

We've also discussed our plans to file two new pulmonary Cta this year, but had not previously disclosed the targets or disease areas I'm excited to announce these programs, formerly as arrow rage, and Aero Muck five AC each being developed for various mutual obstructive and inflammatory pulmonary conditions.

Christopher Anzalone: We will be presenting preclinical data at the American thoracic side meeting in May, and we also plan to host a KOL webinar or pulmonary specific R&D day this year. At the latter event, we intend to go into detail on the biology of the targets, present preclinical data, introduce the commercial market opportunity, explain our plans for the clinical studies, and have an outside KOL describe the clinical presentation of the disease and unmet medical needs.

We are on track to file Cta is for both of these over the next quarter, we will be presenting preclinical data at the American Thoracic Society meeting in May and we also plan to host a kols webinar or pulmonary specific R&D day. This year at the latter event, we intend to go into detail on the biology of the targets present preclinical data introduced the <unk>.

<unk> market opportunity explain our plans for the clinical studies and have an outside Kols described the clinical presentation of the disease, an unmet medical need.

Christopher Anzalone: We're pleased that we expect to file two new pulmonary CTAs in the first half of 2022 and are also on track to file a third by the end of this year. That target in disease area remain undisclosed. While still on the pulmonary platform, we continue to make progress in COVID and are currently testing compounds that are leading to substantially decreased lung inflammation and viral expression in animal. This is exciting for what they may mean for the current SARS-CoV-2 but also potentially for other SARS-based coronaviruses. As you may recall, we are working to develop antiviral agents by targeting regions that are well conserved across the known SARS coronaviruses with the hope that we could treat current and future novel infections.

We are pleased that we expect to file two new pulmonary Cta as in the first half of 2022 and are also on track to file a third by the end of this year that targeted disease area remain undisclosed.

While still in the pulmonary platform, we continue to make progress in Covid and are currently testing compounds that are leading to substantially decreased lung inflammation and viral expression in animal models.

This is exciting for what they may mean for the current Sars cov, two but also potentially for other stars based Corona viruses as.

As you May recall, we are working to develop antiviral agents by targeting regions that are well conserved across a known stars Corona viruses with the hope that we could treat current and future novel infections.

Christopher Anzalone: Our progress here has also opened doors for us in other respiratory viruses, where we now have active programs. We could see that becoming a substantial sub-franchise, if you will, within our pulmonary platform. These are exciting opportunities for us and we look forward to updating you on our progress. In addition to the two new pulmonary CTAs in the first half of this year, we are on track with AeroDUX4, our first skeletal muscle targeted candidate against FSHD.

Our progress here has also opened doors for us and other respiratory viruses, where we now have active programs we can.

Could see that becoming a substantial sub franchise, if you will within our pulmonary platform.

These are exciting opportunities for us and we look forward to updating you on our progress.

In addition to the two new pulmonary Cta as in the first half of this year. We are on track with Arrow Dux for our first skeletal muscle targeted candidate against Fsh D.

Christopher Anzalone: Consistent with our prior guidance, we expect to file that CTA by the end of the first half of, This represents a leap forward with the addition of another cell type we can target clinically, and more specifically, Arrow Dux4 may offer us the ability to help a group of patients with no real therapeutic options. Recent failures and setbacks in the field have underlined the unmet medical need that currently exists and we are moving as fast as we can for the FSHD patients who need us. Our partner programs have also made good progress.

With our prior guidance, we expect to file that Cta by the end of the first half of this year.

This represents a leap forward with the addition of another cell type, we can target a clinically and more specifically <unk> may offer us the ability to help a group of patients with no real therapeutic options.

Recent failures and setbacks in the field have underlying the unmet medical need that currently exists and we are moving as fast as we can for the FSA HD patients who need us.

Our program programs have also made good progress J&J.

Christopher Anzalone: J&J continues its Phase 1 progress and J&J 75220795, our partner, Nash Therapeutic, and J&J 3989, our partner, HPV Therapeutic. The latter is in multiple Phase IIb studies that have started to read out, and I would expect regular data from them over the next few years. As we discussed on our last earnings call, J&J 3989 is doing exactly what it was designed to do, and we look forward to seeing how it performs over time and in combination with different agents.

J&J continues its phase one progress and J&J 75 to two O 795, our partner Nash therapeutic and J&J $39 89 or partner to HBV therapeutic.

The latter is in multiple phase <unk> studies that have started to readout and I would expect regular data from them over the next few years as we discussed on our last earnings call. J&J 3900, 89 is doing exactly what it was designed to do and we look forward to seeing how it performs over time and in combination with different agents.

Christopher Anzalone: We'll pass around the candidates against cardiovascular disease that we licensed to Amgen continues in a phase two study. Amgen has said publicly that they expect to complete the Phase 2 in the first half of this year. Data from the Phase 1 were impressive, and we look forward to seeing Phase 2 data and the initiation of a Phase 3. Arrow AAT has an ongoing phase 2b study that is currently starting to read out PK data at three different dose levels and will read out biopsy data in the third or fourth quarter.

El Paso, and the candidate against cardiovascular disease that we licensed to Amgen continues in a phase II study.

Amgen has said publicly that they expect to complete the phase III in the first half of this year data from the phase one were impressive and we look forward to seeing phase two data and the initiation of a phase III.

<unk> has an ongoing phase <unk> study that is currently starting to read out PK data at three different dose levels and will readout biopsy data in the third or fourth quarter.

Christopher Anzalone: We continue to work closely with Takeda and expect to continue discussions with regulators this year about our data and plans for a pivotal study. Our work with Verizon continues to move rapidly in the area of chronic gout and I will defer to them to provide guidance and future plans in time. Lastly, we completed a transaction to purchase 13 acres of land in Verona, Wisconsin, which is planned to be the site of a new GMP drug manufacturing facility and an associated laboratory and office facility. Construction is starting this quarter.

We continue to work closely with Takeda and expect to continue discussions with regulators this year about our data and plans for a pivotal study.

Our work with Horizon continues to move rapidly in the area of chronic gout and I'll defer to them to provide guidance and future plans and timing.

Lastly, we completed a transaction to purchase 13 acres of land in Verona, Wisconsin, which is planned to be the site of a new GMP drug manufacturing facility and an associated laboratory and office facility.

Construction is starting this quarter complete.

Christopher Anzalone: Completion of the lab and office space is anticipated in early to mid 2023 and completion of the manufacturing facility is expected in late 2023. We will continue to operate additional research and development facilities in Madison, Wisconsin and San Diego, California. We also signed a lease to what will allow us to substantially expand our research laboratories and administrative offices in San Diego in the first half of 2023. We believe the new Arrowhead campuses will allow us to support our growing pipeline and we think positions us well to advance the manufacturing process, including a commercial scale of our trim-enabled drug candidates.

Completion of the lab and office space is anticipated in early to mid 2023 and completion of the manufacturing facility is expected in late 2023.

We will continue to operate additional research and development facilities, and Madison, Wisconsin, and San Diego, California.

We also signed a lease to what will allow us to substantially expand our research laboratories and administrative offices in San Diego in the first half of 2023.

We believe the new Arrowhead campuses will allow us to support our growing pipeline and we think positions us well to advance the manufacturing process, including at commercial scale of our trim enabled drug candidates. We view this as a strong competitive advantage as we approach potential commercialization of our rapidly progressing clinical candidates.

Christopher Anzalone: We view this as a strong competitive advantage as we approach potential commercialization of our rapidly progressing clinical candidates. So in summary, our pipeline is expanding and maturing. Our platform is providing additional opportunities to discover and develop new investigational medicines in areas where Arrowhead has unique capabilities and expertise. We are using business development selectively to maximize the value of our technology, and to bring in non-dilutive capital to support our internal development program.

So in summary, our pipeline is expanding and maturing our.

Platform is providing additional opportunities to discover and develop new investigational medicines in areas, where arrowhead has unique capabilities and expertise.

We are using business development selectively to maximize the value of our technology and to bring in non dilutive capital to support our internal development programs.

Christopher Anzalone: And we're investing to expand our R&D footprint and take more control of the drug manufacturing process to support clinical and ultimately commercial supply needs. We believe all of this puts Arrowhead in a very strong competitive position. With that overview, I'd now like to turn the call over to Dr. Javier San Martin. Javier?

And we are investing to expand our R&D footprint and take more control of the drug manufacturing process to support clinical and ultimately commercial supply needs.

We believe all of this puts arrowhead and a very strong competitive position.

With that overview I'd now like to turn the call over to Dr. Javier San Martin Javier.

Javier San Martin: Thank you, Chris. And good afternoon, everyone. I will provide status updates on three of our later stage clinical. Arrow ApoC3, Arrow H3, our investigational cardiometabolic medicine, and Arrow AAT, also called TAX999, our investigational medicine designed to treat alpha-1 liver disease, which is being co-developed with Takeda. First Arrow ApoC3 is our investigational medicine targeting ApoLipoprotein C3 being studied in patients with various lipid disorders.

Thank you Kris and good afternoon, everyone I will provide status updates on three of our later stage clinical programs.

<unk> three <unk> three our investigation.

And.

<unk> also called Tak 999, our investigational medicine designed to treat alpha one liver disease, which is being co developed with Takeda.

First <unk> is our investigation on medicine targeting Apolipoprotein C. III study in patients with various lipid disorders.

Javier San Martin: Collectively, the mid and late stage clinical study for Arrow ApoCt are called the summit program. We made good progress bringing on new sites for each of the studies and were very pleased with the pace of patients' enrolment. I will discuss each study individually. TASTA-2 is a double-blind, placebo-controlled, phase-2b study of Arrowhead Pocetri in adults with severe hypertriglyceridemia, or SHTD. The population is defined as having triglycerides greater than 500 mg per deciliter.

Collectively they need in late stage clinical study for <unk>.

Semi program.

We made good progress, bringing on new site for each of the studies and were very pleased with the pace of patients from Goldman I will discuss each individually.

Javier San Martin: The primary objective of the SHAS-TATU study is to evaluate the safety and efficacy of Arrow ApoC3 and to select a dosing regimen for later stage clinical studies in this patient population. Approximately 216 patients will be enrolled in this study. Moving on to the MIR study, which is a double-blind, placebo-controlled, Phase IIb study of Arrowhead Pocitri in adults with mixed dyslipidemia. This population is defined as having triglycerides between 150 and 500 mg and non-HDL cholesterol greater than 100 mg or LDL cholesterol greater than 70 mg per deciliter.

Does that too is a double blind placebo control phase II study of <unk> in adults with severe hypercholesterolemia or <unk>.

This population is defined as having triglycerides greater than 500 milligrams per deciliter deployment of a <unk> two studies to evaluate the safety and efficacy of federal Apoc, III and to select a dosing regimen for the later stage clinical studies in these patient population.

<unk> 216 patients will be enrolled in the study.

Moving onto the immuno study, which is a double blind placebo controlled phase II B study of Aro <unk> in efforts with mixed Dyslipidemia.

Population is defined as having triglycerides between 150, and 500 milligrams and non HDL cholesterol and greater than 100 milligrams or LDL cholesterol greater than 70 milligrams per deciliter.

Javier San Martin: The primary objective of the MIR study is to evaluate the safety and efficacy of Arrowhead Procedure 3 and to select a dose and dose enrichment for later stage clinical studies in patients with mixed disease lipidemia. A total of approximately 320 patients will be enrolled in this study. The most recent study initiated in the SAMI program is Palisades. Tree Study to Evaluate the Efficacy and Safety of Arrow ApoC Tree in Adults with Familiar Chylomethronemia Syndrome, or FCA.

The parameter of shifting of immune study is to evaluate the safety and efficacy of <unk> and to select a dose and dosing regimen for later stage clinical studies in patients with mixed Dyslipidemia.

A total of approximately 320 patients will be enrolled in this study.

The most recent study initiating the semi program is policy if phase III study to evaluate the efficacy and safety of <unk> in Netherlands, we firmly of the economy, turning <unk> syndrome.

Yes.

Javier San Martin: These are patients with fasting triglycerides greater than 880 mg per deciliter that are refractory to standard lipid-lowered therapy and have a diagnosis of FCS, because they tend to have extremely high triglycerides. Patients with FCS have an elevated risk of recurrent and painful bouts of pancreatitis. These patients currently have very limited treatment. The primary endpoint of parasites is the percent change from baseline at month 10 in fasting triglycerides.

These are patients with first integrated with greater than 880 milligrams per deciliter. So that's refractory to standard lipid lowering therapy and have a diagnosis of FCA.

Because they tend to have extremely high triglycerides in patients with FCS have an elevated risk of recurrent painful boats of pancreatitis.

These patients currently have very limited treatment options.

The primary endpoint of Palisades is the percent change from baseline at months, Tim in the fasting triglyceride.

Javier San Martin: Additional secondary and expiratory endpoints include the change in other lipid parameters, incidence of acute pancreatitis, and other. Approximately 60 patients will be enrolled. I will now move on to ArrowH3, our investigational medicine designed to reduce the production of angiopoietin liprotein 3, HPTL3, as a potential treatment for patients with mixed sleep epidemia. The set of mid- and late-stage studies for Arrowhead 3 is called the VISTA program.

<unk> secondary and exploratory endpoints include the change in other lipid parameters incidence of acute pancreatitis and other measures approximately 60 patients will be enrolled.

I will now move on to <unk>, our investigational medicine designed to reduce pollution of Angiopoietin like protein three <unk> III as a potential treatment for patients with mixed dyslipidemia.

This means in late stage studies.

It is called the <unk> program.

Javier San Martin: This program has one active study and one additional planned study that I will describe briefly in a minute. The currently active study is ARCOS-2, a double-blind, placebo-controlled, phase 2b study of investigational Arrowhange 3 in adults with myx dyslipidemia. This population is defined the same way as in the Arrow ApoC3 MIR study. This patient had triglycerides between 150 and 500 milligrams per deciliter and non-HDL cholesterol greater than 100 milligrams per deciliter or LDL cholesterol greater than 70 milligrams.

Pepco has one active and one additional plan study that I would describe briefly in a moment.

Yes.

The currently active study is arco's two double blind placebo control phase II study of investigation on payroll agency in adults with mixed Dyslipidemia.

This population is defined the same way as in the <unk> study. These.

These patients have <unk> between 150 and 500 meeting.

As a leader and non HDL cholesterol greater than 100 milligrams per deciliter, LDL cholesterol greater than 17 meeting after the Cds.

Javier San Martin: The primary objective of the R2-Study is to evaluate the safety and efficacy of Arrowhead 3 in adults with mixed dyslipidemia and select a dosing regimen for later stage clinical studies in this patient population. A total of approximately 180 patients will be enrolled. The next study plan for the VISTA program is GATEWAY, a phase two study of Arrowhead 3 in patients with homozygous familial hypercholesterolemia, or HOF. Statins and PCSK9 inhibitors can inhibit cholesterol synthesis and enhance hepatic clearance of LDL cholesterol through upregulation of the hepatocyte LDL receptor.

Revenue objective of the <unk> two study is to evaluate the safety and efficacy of <unk> in adults with mixed Dyslipidemia and cynic dosing regimen for later stage clinical studies in these patient populations.

Approximately 180 patients will be enrolled in this study.

The next study plan for the Vista program as Gateway, a phase II study of <unk> in patients with homozygous familial hypercholesterolemia or <unk> FH that's.

<unk> inhibitors inhibit cholesterol synthesis and enhance hepatic clearance of LDL cholesterol to upregulation of the hepatocyte LDL receptor.

Javier San Martin: Patients with HOFH can have dysfunctional or absent LDL receptor and thus can be resistant to statins and even resistant to alternatives such as PCSK9 inhibitors, patients with HOFH are therefore a population with a particularly high need for additional therapies, with a mechanism that works outside of the LDL receptor, such as HPTL3 in EDM. There is an open-level study that will be conducted in SAPCHS with documented HOFH based on genotype or clinical criteria, up to approximately 16 factions who meet eligibility criteria will be randomized in a one-to-one ratio to receive two doses of 200 or 300 milligrams of Arrowhead H3 on day one and day 84 and will be evaluated over a 36-week period, are getting up to initiate the study in the first half of 2022 and will provide an update when the first patient has been, In the system with the other phase two studies in both the VISTA and the STEMI programs, we want to give Arrowhead maximum flexibility to initiate phase three studies in multiple patient populations if the data works.

Issue with HOA, FHA has dysfunction or absent LDL receptor and thus can be resistant to studying it's uneven resistance to alternatives such as <unk> nine inhibitors.

Thanks Jay.

FH and therefore, a population with a particularly high need for additional therapies. We didn't make any set was outside of the LDL receptor such as <unk> in each.

Gateways, an open label study that will be conducted infectious with documented HOA phage based on genotype or clinical criteria.

Approximately 60 infectious who meet the eligibility criteria will be randomized in a one one ratio to receive two doses of 200 or 300 milligrams of it'll agency on day, one and the 84 and will be evaluated over a 36 week period.

We're getting up to initiate the study in the first half of 2022, and we'll provide an update when the first patient have been enrolled.

Consistent with the other phase two studies in both the.

Semi pro as we want to give us maximum flexibility to initiate phase III studies in multiple patient populations, if the data warrant.

Javier San Martin: In the system with the other phase two studies in multiple patient populations if the data works, we want to give Arrowhead maximum flexibility to initiate phase three studies in multiple patient populations if the data works. At the end of these Phase II studies, we hope to have a good understanding of the pharmacodynamic effect of both investigational medicine in various patient populations with different baseline lipid profiles. We believe that this will inform our development strategy and also help shape our commercial strategy in both well-defined rare diseases as well as largely high prevalence.

At the end of these phase II studies, we hope to have a good understanding of the kind of macro dynamic affecting both investigational medicine in various patient populations with different baseline lipid profiles.

We believe that this will inform our development strategy and also help shape, our commercial strategy in both well defined rare diseases as well as largely a high prevalence disease.

Javier San Martin: I also want to give a brief update on Arrow AAT, also called TAC999. After receiving VEC-2 therapy designation, we began a productive dialogue with the FAA about the program. We expect to have data on the reduction of circulating level of AAT from sequoia in the first half of this year, which will be used to select adults for Phase III.

I also want to give a brief update on AIA also called Tak 999, after receiving breakthrough therapy designation, we began a productive dialogue with the FDA about the program. We expect to have data on the reduction of circulating levels of <unk>.

From Sequoia in the first half of this year, which would be used to selected those full phase III.

Javier San Martin: We should also be collecting the last 12-month biopsy from the last patients enrolled sometime in the summer of 2022. Together with Takeda, we look forward to continuing the dialogue with the FAA after one or both of these data releases. I will now turn the call over to Dr. James Hamilton. James.

We should also be collecting the last 12 months biopsy from the paid for the last patients enrolled sometime in the summer of 2022.

Together with the K that we look forward to continuing the dialogue with the FDA after one or both of these data readouts.

I will now turn the call over to Jamie.

James.

James Hamilton: Thank you, Javier. There are a lot of exciting new programs in discovery and early stage clinical development. Our R&D organization is operating at an impressive pace and making important progress in multiple areas. Today, I would like to focus on the pulmonary platform, the planned expansion of the pulmonary pipeline, and provide an update on where we are with Arrowina. As Chris mentioned, our newest pulmonary candidates are Arrow Rage and Arrow MUC5AC. They are both on schedule to have CTA filings during the first half of this year.

Thank you Javier.

There are a lot of exciting new programs in discovery and early stage clinical development.

Our R&D organization is operating at an impressive pace and making important progress in multiple areas.

James Hamilton: Additionally, we plan on filing a third pulmonary CTA in Q4 of this year. The target for this third program will remain undisclosed at this time. The first program, Arrow Muck by the Sea, targets expression of Muck by the Sea in bronchial epithelial David Lebowitz, David Lebowitz, David Lebowitz, David Lebowitz, MUC5AC is a mucin protein with upregulated expression in the asthmatic airway. MUC5AC is not normally required for bacterial defense or mucociliary clearance in healthy individuals.

Today, I would like to focus on the pulmonary platform the <unk>.

Planned expansion of the pulmonary pipeline.

And provide an update on where we are with <unk>.

As Chris mentioned, our newest pulmonary candidates are Aero rage, and Aero Mach five AC.

They are both on schedule to have Cta filings during the first half of this year.

Additionally, we plan on filing a third pulmonary Cta in Q4 of this year.

The target for this third program will remain undisclosed at this time.

The first program Arrow marked by they see targets expression of Mark by Basi and bronchial epithelium.

James Hamilton: However, in asthmatic patients, its upregulation and enhanced secretion can lead to a mucoobstructive disease state, which is not directly addressed by currently available therapies. The degree of mucus obstruction in the asthmatic airway is highly correlated with poor asthma control and increased disease severity. Additionally, multiple genome-wide association studies have demonstrated a correlation between enhanced MUC5AC expression and the development of as, Similarly, mice with a genetic deletion of Muck 5 AC are protected from airway hyperreactivity in the setting of allergic stimuli. Again supporting the concept that Muck 5 AC driven mucus plugging plays a central role in allergen-induced airflow obstruction. Muck 5 AC driven mucus plugging plays a central role in allergen-induced airflow obstruction.

Mark by they see is amusing protein was up regulated expression in the asthmatic airway.

Mark privacy is not normally required for bacterial defense or mucociliary clearance in healthy individuals.

However, in asthmatic patients, it's upregulation and enhanced accretion and lead to a mutual obstructive disease state, which is not directly addressed by currently available therapies.

The degree of mucus obstruction in the asthmatic airway is highly correlated with poor asthma control and increased disease severity.

Additionally, multiple genome wide Association studies have demonstrated a correlation between enhanced marked by <unk> expression and the development of asthma.

Similarly mice with a genetic deletion of muck fiber C are protected from airway hyper reactivity in the setting of allergic stimuli again supporting the concept that multiply they see driven mucus plugging plays a central role in Allergan induced airflow obstruction.

James Hamilton: Muck 5 AC driven mucus plugging plays a central role in allergen-induced airflow. Arrow Muc5ac is an extremely exciting program, in part because it represents a fundamentally new way of treating asthma. By targeting the mucus, we have a unique and potentially very powerful tool. An abstract summarizing preclinical data leading to the nomination of this clinical candidate will be presented at the American Thoracic Society meeting this spring. The second program, Arrow Rage, targets expression of the Receptor for Advanced Glycation End Products, or RAGE, which is primarily expressed by alveolar and bronchial epithelium. RAGE is a transmembrane receptor that binds to numerous pathogen associated and cell damage associated ligands to activate various components of the innate immune system.

<unk> is an extremely exciting program in part because it represents a fundamentally new way of treating asthma by targeting the mucus, we have a unique and potentially very powerful tool.

An abstract summarizing preclinical data leading to the nomination of this clinical candidate will be presented at the American Thoracic Society meeting this spring.

James Hamilton: RAGE represents an upstream mediator of the inflammatory cascade in asthma, as it is required for allergen induced release of IL-33 into the airway and acts upstream of type 2 cytokines including IL-4, IL-5, and IL-13. Importantly, a soluble component of RAGE, known as S-RAGE, can be followed as a serum biomarker of gene target knockdown. This is a very important point that I want to highlight. The availability of a circulating biomarker will teach us a lot about the candidate and, importantly, may inform on the pulmonary platform broadly. Our hepatocytes-directed trim system has proven to translate very predictively from pre-clinical models to human results.

The second program.

Rage target expression of the receptor for advanced location and products, where rage, which is primarily expressed by alveolar and bronchial epithelium.

Rage is a trans membrane receptor that binds to numerous pathogen associated and cell damage associated ligand to activate various components of the innate immune system.

Rage represents an upstream mediator of the inflammatory cascade in asthma as it is required for Allergan induced release of IL 33 into the airway and acts upstream of type two cytokines, including IL four IL five and IL 13.

Importantly, our soluble component of rage known as S. Rage can be followed as a serum biomarker of gene target knockdown.

This is a very important point that I want to highlight.

The availability of a circulating biomarker, we will teach us a lot about the candidates and importantly may inform on the pulmonary platform broadly.

James Hamilton: And over the last few years, that predictability has increased the speed of our new programs and our expectation of success. [inaudible] We hope to get to the same point with the pulmonary-directed TRMM system and the availability of SRAGE circulating biomarker data informing on depth and duration of gene target knockdown using an inhaled route of administration, could get us closer to that point. Animal data suggest that rage signaling plays a critical role in the pulmonary inflammatory responses to inhaled stimuli. Rage Knockout Mice, show a markedly attenuated response to allergen exposure.

Our hepatocytes directed trim system has proven to translate very predictably from preclinical models to humans results and over the last few years that predictability has increased the speed of our new programs and our expectation of success.

We hope to get to the same point with pulmonary directed trim system and the availability of S. Rage circulating biomarker data informing on depth and duration of gene target knockdown using an inhaled route of administration.

Could get us closer to that point.

Animal data suggests that a rage signaling plays a critical role in the pulmonary inflammatory responses to inhaled stimuli.

Rage knocked out knockout mice.

Joe a markedly attenuated response to Allergan exposure.

James Hamilton: In animals, RAGE is necessary for activation of airway inflammatory pathways relevant to both type 2 high and potentially type 2 low asthma phenotypes. Further studies have indicated that rage knockout mice are protected from allergen provoked increases in IL-33 and TSLP, which represent key upstream drivers of asthmatic type 2 inflammation. Thus, we believe a rage inhibition offers the possibility of arresting the most proximal components of airway inflammation and asthma with potentially broad effects on a wide range of downstream inflammatory mediators, in rats using a tool trigger targeting rage mRNA, single inhaled doses of 0.5 milligrams per kilogram, induce S-Rage reduction of over 90%, for approximately three months.

In animals rages necessary for activation of airway inflammatory pathways relevant to both type two high end potentially type two low asthma phenotypes.

Further studies that indicated that rage knockout mice are protected from Allergan provoked increases in IL 33, and GSL P, which represent key upstream drivers of asthmatic type two inflammation.

Thus, we believe a rage inhibition offers the possibility of arresting the most proximal components of airway inflammation in asthma with potentially broad effects on a wide range of downstream inflammatory mediators.

In rats, using a tool trigger targeting rage mrna.

Single inhaled doses of <unk> five milligrams per kilograms.

Induce S rates reduction of over 90%.

For approximately three months.

James Hamilton: Like our Mock 5AC program, an abstract has been accepted for oral presentation at ATS this spring, which will summarize preclinical data for our RAGE program. Inhibition of both the MUC5AC and RAGE targets may have clinical utility in severe asthma, COPD, cystic fibrosis, and other mucoobstructive or inflammatory pulmonary conditions. Additional target background.

Like are marked by Basi program, an abstract has been accepted for oral presentation at Ats. This spring, which will summarize preclinical data for our Rage program.

Inhibition of both the Mach five AC enrage targets may have clinical utility in severe asthma, COPD cystic fibrosis, and other mutual obstructive or inflammatory pulmonary conditions.

Additional target background data and clinical plans will be discussed in the future as we approach the start of the clinical studies.

James Hamilton: Data and clinical plans will be discussed in the future as we approach the start of the clinical study. We are also making good progress on two additional pulmonary programs that are being developed to address respiratory virus. One is our COVID program that targets highly conserved sequences in essential viral mRNAs, which may address SARS-CoV-2 and potentially other future coronavirus outbreaks. In a hamster SARS-CoV-2 infection model, our current lead candidate reduced viral load in the lung by 80 percent, reduced histological indices of pulmonary inflammation by 50% Prevented Body Weight Loss.

We are also making good progress on two additional pulmonary programs that are being developed to address respiratory viruses.

One is our Covid program that targets highly conserved sequences and essential viral mrna is.

Which may address serves Kobe, two and potentially other future Corona virus outbreaks.

And a hamster serves koby to infection model, our current lead candidate reduced viral load in the lung by 80%.

Reduced histological indices pulmonary inflammation by 50%.

And prevented body weight loss.

James Hamilton: We are currently in the lead optimization stage and will provide additional updates when we can. The other is a new program for an undisclosed viral infection. In a mouse model of infection, the current lead compound reduced viral gene expression in the lung by 90% and prevented body weight loss.

We are currently in the lead optimization stage and we'll provide additional updates when we can.

The other is a new program for an undisclosed viral infection.

In a mouse model of infection. The current lead compound reduced viral gene expression in the lung by 90% and prevented body weight loss.

James Hamilton: This is an early program, but we are seeing what we believe are very promising results. Moving to Arrow ENAG. As Chris mentioned, we have decided to focus our resources on next generation candidates. We previously announced that the clinical study was voluntarily paused after findings of local lung inflammation in a rat chronic GOP toxicology study. We have since seen some local inflammatory findings in chronic GOP monkey studies. It is certainly possible that we are overdosing the animals by simply and by simply changing the dose level and or dose intervals, we would see a cleaner tox profile.

This is an early program, but we are seeing what we believe are very promising results.

Moving to <unk> as Chris mentioned, we have decided to focus our resources on next generation candidates.

We previously announced that the clinical study was voluntarily paused after findings of local lung inflammation in Iraq chronic GOP toxicology studies.

We have since seen some local inflammatory findings and chronic GOP monkey studies.

It is certainly possible that we're overdosing the animals by simply and by simply changing the dose level <unk> dose intervals, we would see a cleaner tox profile.

James Hamilton: That could provide a faster path back to the clinic, but we decided that the better long term path is to focus on next generation Enoch candidates. We are currently interrogating several next generation ENET candidates that appear to be substantially more potent than Arrow ENET. It should be noted that the drug exposure levels used in the CTA-enabling GOP studies supporting the new pulmonary programs, including the Muck 5 AC and Rage programs are significantly lower than those used in support of our first-generation E-neck program.

That could provide a faster path back to the clinic, but we decided that the better long term path is to focus on next generation <unk> candidates.

We are currently interrogating several next generation candidates that appeared to be substantially more potent than <unk>.

It should be noted that the drug exposure levels used in the Cta, enabling GOP studies supporting the new pulmonary programs, including the Mach five AC and rage programs are significantly lower than those used in support of our first generation <unk> program.

James Hamilton: Thus, we expect an ability to use less drug and less frequent dose administration with second generation programs compared to what was used in the Arrow ENAC chronic toxicology studies and anticipate overall enhanced toxicology species safety margins with second generation compounds.

Thus, we expect an ability to use less drug and less frequent dose administration with second generation programs compared to what was used in the <unk>.

Chronic toxicology studies and anticipate overall enhanced toxicology species safety margins with second generation compounds.

James Hamilton: The last update I'd like to provide on the pulmonary platform is about future opportunities and the potential to add additional flexibility with regards to route of administration. We've been working on addressing pulmonary tissues via subcutaneous administration. These are still early days, but we have recently generated some very promising preliminary data with the Arrow RAGE program using subcutaneous administration. Again, this is early, but we view this as a potential breakthrough if this line of discovery bears fruit. We intend to provide some data on these efforts when we go into more detail about the Arrow Rage and Arrow MUC5AC candidates, at the appropriate forum.

The last update I'd like to provide on the pulmonary platform is about future opportunities and the potential to add additional flexibility with regards to route of administration.

We've been working on addressing pulmonary tissues via subcutaneous administration.

These are still early days, but we have recently generated some very promising preliminary data with the Arrow Rage program using subcutaneous administration.

Again this is early but we view this as a potential breakthrough if this line of discovery bears fruit.

We intend to provide some data on these efforts when we go into more detail about the Aero rage and Aero multiply they seek candidates.

At the appropriate form.

James Hamilton: This will likely take the form of a KOL webinar or an in-person and webcast pulmonary R&D day in the first half of this year. This is all very exciting progress and we look forward to discussing details publicly. I will now turn the call over to Ken Myszkowski. Ken?

This will likely take the form of a KOL webinar or an in person and webcast pulmonary R&D day in the first half of this year.

This is all very exciting progress and we look forward to discussing details publicly.

I will now turn the call over to Ken Moskovsky Ken.

Ken Myszkowski: Thank you, James, and good afternoon, everyone. As we reported today, our net loss for the quarter ended December 31st, 2021 was $62.9 million, or $0.60 per share, based on $104.5 million fully diluted weighted average shares outstanding. This compares with a net loss of $20.7 million, or $0.20 per share, based on $102.8 million fully diluted weighted average shares outstanding for the quarter ended December 31, 2020.

Thank you James and good afternoon, everyone.

As we reported today, our net loss for the quarter ended December 31, 2021 was $62 9 million or <unk> 60 per share based on $104 5 million fully diluted weighted average shares outstanding.

This compares with a net loss of $20 7 million or <unk> 20 per share based on $102 8 million fully diluted weighted average shares outstanding for the quarter ended December 31 2020.

Ken Myszkowski: Revenue for the quarter ended December 31st, 2021 was $27.4 million, compared to $21.3 million for the quarter ended December 31st, 2020. Revenue in the current period primarily relates to recognition of a portion of the $300 million upfront payment received under our collaboration agreement with Takeda, and the $40 million upfront payment received under our collaboration agreement with Horizon. Revenue for, For each agreement will be recognized as we complete our performance obligations, which include managing the ongoing AAT Phase 2 clinical trials for Takeda and delivering a Phase 1 ready candidate to Horizon.

Revenue for the quarter ended December 31, 2021 was $27 4 million compared to $21 3 million for the quarter ended December 31 2020.

Revenue in the current period, primarily relates to the recognition of a portion of the 300 million upfront payment received under our collaboration agreement with Takeda and the $40 million upfront payment.

<unk> under our collaboration agreement with Horizon.

Yes.

Revenue for.

For each agreement will be recognized as we complete our performance obligations, which include managing the ongoing phase.

Phase III clinical trials for Takeda and delivering at phase one ready candidate to horizon.

Ken Myszkowski: There remains $188 million of revenue to be recognized associated with the Takeda collaboration, which we anticipate will be recognized over approximately two to three years, and there remains $27 million of revenue for Horizon, which we anticipate will be recognized by the end of calendar 2022. Prevenue in a prior period, primarily related to recognition of a portion of the milestones we see from our license and collaboration agreements with Jann David Lebowitz, David Lebowitz, David Lebowitz, Finally, our license agreement with GSK for Arrow HSD resulted in a $120 million upfront payment to Arrowhead, which was collected in January 2022.

There remains $188 million of revenue to be recognized associated with the Takeda collaboration, which we anticipate will be recognized over approximately two to three years and there remains $27 million of revenue for horizon, which we anticipate will be recognized by the end of calendar 2022.

Revenue in the prior period, primarily related to the recognition of a portion of the milestones received from our license and collaboration agreements with Janssen.

Finally, our license agreement with GSK for Aero HST resulted in a $120 million upfront payment to Arrowhead, which was collected in January 2022.

Ken Myszkowski: We anticipate the majority of this to be recognized as revenue in fiscal second quarter 2022. Any additional milestones achieved from our collaboration agreements would be additive to these amounts. Total operating expenses for the quarter ended December 31, 2021 were $90.8 million, compared to $45.4 million for the quarter ended December 31, 2020. This increase is primarily due to increased clinical candidate costs as our pipeline has expanded and advanced through clinical trial stages, as well as increased non-cash stock compensation.

We anticipate the majority of this to be recognized as revenue in fiscal second quarter 2022.

Any additional milestones achieved from our collaboration agreements would be additive to these amounts.

Total operating expenses for the quarter ended December 31, 2021 were $90 8 million compared to $45 4 million for the quarter ended December 31, 2020. This increase is primarily due to increased clinical candidate costs, but our pipeline has expanded.

Through our clinical and advanced through clinical trial stages as.

As well as increased non cash stock compensation costs.

Ken Myszkowski: Net cash used by operating activities during the quarter ended December 31, 2021 was $61.3 million, compared with net cash used by operating activities of $38.9 million during the quarter ended December 31, 2020. Key driver of this change was the increased candidate cost.

Net cash used by operating activities. During the quarter ended December 31, 2021 was $61 3 million compared with net cash used by operating activities of $38 9 million during the quarter ended December 31 2020.

Key driver of this change was the increase candidate costs.

Ken Myszkowski: We continue to estimate our operating cash burden to be $60 to $80 million per quarter in fiscal 2022, including any income, incoming milestone payments from our partners. In addition, we are planning to expand our manufacturing capabilities and expand our R&D facilities. We continue to estimate these capital projects, along with routine capital expenditures, will add an incremental cash outlay of $80 to $90 million per full year fiscal 2022. According to our balance sheet, our cash and investments totaled $547.7 million at December 31, 2021, compared to $613.4 million at September 30, 2021. Decrease in our cash and investments was primarily due to cash used for operating activities.

We continue to estimate our operating cash burn to be $60 million to $80 million per quarter in fiscal 2022.

Moving any income incoming milestone payments from our partners.

In addition, we are planning to expand our manufacturing capabilities and expand our R&D facilities.

We continue to estimate these capital projects, along with routine capital expenditures will add an incremental cash outlay of $80 to $90 billion for full year fiscal 2022.

Turning to our balance sheet, our cash and investments totaled $547 7 million at December 31, 2021, compared to $613 4 million at September 30.

2021.

The decrease in our cash and investments was primarily due to cash used for operating activities.

Ken Myszkowski: With the collection of the $120 million upfront payment in January 2022, our current cash and investments total approximately $650 million. Our common shares outstanding at December 31st, 2021 were $104.8 million. With that brief overview, I will now turn the call back to Chris. Thanks, Ken, and thanks to all of you for joining us today. As you've heard, our early pipeline is starting to grow rapidly, our mid and later stage pipeline is advancing on schedule, and we are working hard to continue to expand the reach of our TRMM platform to enable more growth in the future. These are all critical parts of building a sustainable business and growing shareholder value.

With the collection of the $120 million upfront payment in January 2022, our current cash and investments totaled approximately $650 million.

Our common shares outstanding at December 31, 2021 were $104 8 million.

With that brief overview I will now turn the call back to Chris.

Thanks, Ken and thanks to all of you for joining us today.

As you've heard our early pipeline is starting to grow rapidly our mid and later stage pipeline is advancing on schedule and we are working hard to continue to expand the reach of our trim platform to enable more growth in the future.

These are all critical parts of building, a sustainable business and growing shareholder value.

Christopher Anzalone: I want to take a moment to review what we see on the horizon as potential milestones for the business this year. There's a lot going on, so this list is certainly not exhaustive, but include some of the key events that we will be tracking. I'll start with our partnering program. Arrow AAT also called TAC-999 for Alpha-1 liver disease with Takeda. We expect data from the Sequoia study on reductions in circulating AAT levels and 12-month biopsy data, and we will continue discussions with the FDA. ArrowHSD for NASH with GSK.

I want to take a moment to review what we see on the horizon as potential milestones for the business this year.

There is a lot going on to this list is certainly not exhaustive but include some of the key events that we will be tracking.

Christopher Anzalone: We expect a Phase 2 study to begin this year. Arrow XDH for Gout with Horizon. We hope to complete pre-clinical studies this year. J&J 3989 for HPV with Janssen, We would expect additional clinical readouts from various ongoing studies. J&J 75220795.

I'll start with our partnered programs.

<unk> also called Tech 99, 9% for Alpha one liver disease with Takeda.

We expect data from this study on reduction in circulating <unk> levels, and 12 month biopsy data and we will continue discussions with the FDA.

Aero HST for Nash and <unk> with GSK, we expect the phase III study to begin this year.

<unk> X D H for gout with Horizon, we hope to complete preclinical studies this year.

J&J $39 89 for HBV with Janssen.

We would expect additional clinical readouts from various ongoing studies.

Christopher Anzalone: For NASH, with Jensen, we expect progress on the Phase 1 study. Opassaran, formerly called AMG 890, for cardiovascular disease with Amgen. Amgen is guided to a phase two study readout this year. I'll now talk about potential milestones for our wholly owned program. Arrow ApoC-3 for hypertriglyceridemia. We expect to fully enroll the Shasta 2 and MIRROR Phase 2 studies and make progress toward full enrollment on the Palisade Phase 3 studies. Arrowhands III for mixed dyslipidemia. We plan to fully enroll Arches 2, Phase 2 study, and initiate the Gateway Phase 2 study. Arrow C3 for Complement-Mediated Diseases.

J&J 75, <unk> thousand 795 for Nash with Janssen, we expect progress on the phase one study.

All pass our and formerly called AMG 894, cardiovascular disease with Amgen Amgen has guided to a phase II study readout this year.

Now I'll talk about potential milestones for our wholly owned programs.

Aero Apoc III for hyper triglyceride EMEA.

We expect to fully enroll the Shasta too and mirror phase II studies and make progress towards full enrollment on the palisade phase III study.

Aero and the rate for mixed Dyslipidemia, we plan to fully enroll arches, two phase III study and initiate the gateway phase II study.

<unk> three for complement mediated diseases, we expect to initiate a phase one study and potentially haven't have an initial data readout from our single ascending dose portion of the study in healthy volunteers and initiate the multiple dose portion in various patient populations.

Christopher Anzalone: We expect to initiate a phase one study and potentially have an have an initial data readout from the single ascending dose portion of the study in healthy volunteers and initiate the multiple dose portion in various patient populations. Pulmonary Programs. We plan to file CTAs and initiate clinical studies for Arrow Rage, Arrow MUC5AC, and file a CTA for one additional undisclosed pulmonary program. We also have some early clinical data from the Arrow Rage program. We also could have some early clinical data from the ARO-RAGE program. Arrowhead 2 for renal cell carcinoma. We intend to report additional Phase 1 data at ASCO-GU in February. Arrowdux 4 for FSHD.

Pulmonary programs, we plan to file a Cta and initiated clinical studies for Aero Rage, <unk> AC and file a cta for one additional undisclosed pulmonary program.

We also have some early clinical data from the Arrow rates program. We also could have some early clinical data from the arrow range programs Union.

Arrowhead II for renal cell carcinoma, we intend to report additional phase one data at <unk> in February <unk>.

<unk> four for Fsh D. We plan to file a cta and initiate a phase <unk> clinical study.

Christopher Anzalone: We plan to file a CTA and initiate a Phase 1-2 clinical study. This is a big year by any measure. We plan to push four new drug candidates into clinical studies and possibly a fifth if Arrow XDH with Horizon makes it there. We hope to have some data released from six different programs. We hope to fully enroll three Phase 2b studies. Arrowhead has a lot going on and we look forward to numerous opportunities to show progress across the pipeline throughout the coming year. Thank you for joining us today. I would now like to open the call to your questions. Operator?

This is a big year by any measure we plan to push for new drug candidates into clinical studies, and possibly a fifth if aero SDH with horizon makes it this year.

We hope to have some data released from six different programs, we hope to fully enroll three phase <unk> studies.

Arrowhead is a lot going on and we look forward to numerous opportunities to show progress across the pipeline throughout the coming year.

Operator: Thank you. As a reminder, to ask a question, you'll need to press star 1 on your telephone. To withdraw your question, press the pound key.

Thank you for joining us today, and I would now like to open the call to your questions operator.

Thank you as a reminder to ask a question you will need to press star one on your telephone to withdraw your question press. The pound key we please ask that you limit yourself to one question and one follow up again, we please ask that you limit yourself to one question and one follow up and our first question comes from Madhu Kumar.

Operator: We please ask that you limit yourself to one question and one follow-up. Again, we please ask that you limit yourself to one question and one follow-up. And our first question comes from Adu Kumar from Goldman Sachs. Your line is not open.

From Goldman Sachs. Your line is now open.

Adu Kumar: Yeah, thanks for taking our questions. So, first one on Arrow AAT, maybe we could dig in a little bit on how we should think about the discussions you've had so far and what regulators might need to see from the sequoia circulating AAT data and from the liver biopsy follow-up data. So let me first answer the last part of that question with regard to the serum CAAT values.

Yes, thanks for taking our questions. So first one on Aero AEP, we begin digging a little bit on how do we should think about the discussions you've had so far and what potentially regulators need to see from the.

Sequoia circulating a data in the liver biopsy follow up data.

Yes, yes.

Let me first answer the last part of that question with regard to the assumed.

Values, we're looking at that data to really do the dose selection, but of course, that's now going to be the only parameter we have data from <unk> protein and of course fibrosis.

Javier San Martin: We're looking at that data to really do the dose selection, but of course that's not going to be the only parameter. We have data from liver, Z protein, and of course fibrosis changes, and of course safety as well. So the dose selection we're going to make along with Takeda over the next few months will come out of all that data. With regards to conversation with regulatory agencies, I prefer to not get into any details other than we had a very good interaction about a month and a half ago.

The process changes and of course safety as well so the dose selection.

Along with Takeda over the next few months, we'll come out of all of that.

To fit.

Javier San Martin: And under the breakthrough therapy designation, we have planned a number of interactions this year to again, define the phase three study or the registration study that will incorporate of course, those, And I think it's important to point out that, look, this division has not considered, to our knowledge, any other drug candidates against this disease. And so our first meeting was really to make sure that we're all level set, that we're all on the same page. And you know what?

With regards to compensation with regulatory agencies.

So.

No get into any details other than that we had a very good introduction of a month and a half ago.

Under the breakthrough therapy designation.

We have plan a number of interactions this year too again defined the phase III study or the registration study that will incorporate a of course those cynics and.

I think it's important to point out that look this division has not considered.

To our knowledge.

Any other drug candidates against this disease and so so our first meeting was really to make sure that the world level set that we're all on the same page and we really are.

Javier San Martin: We really are. There is broad understanding and appreciation for the unmet medical need of this disease. There's broad appreciation, I believe, for the fact that this appears to be a disease of growing incidence as people are living longer because they're not smoking, etc. I think that the world is starting to see that while historically this has been viewed as primarily a pulmonary disease and maybe secondarily as a liver disease, as people are living longer, as they're not smoking, I think we're seeing a greater focus on the liver portion of that.

There is broad understanding and appreciation for the unmet medical need in this disease is broad appreciation I believe for it from the fact that this appears to be a disease of growing incidence as people are living longer because they are not smoking et cetera.

Think that that that that.

The world is starting to see that while historically this has been viewed as a.

It's primarily a pulmonary disease and maybe secondarily asset liver disease as people are living longer ads are not smoking I think we are seeing greater.

Later.

Focus on deliver a portion of that so I think that we've been we've been really.

Javier San Martin: So I think that we've had a great relationship so far with the FDA. We look forward to taking the next step. Okay, so second question relates to the cardiometabolic field for y'all. So how do you think about the launch of Novartis and Lectio and how that influences how you think about kind of the larger ambitions for drugs like Arrowhead, post-U3 and Arrowhead, You know, that's gonna be interesting. As you know, of course, those those the Lepio markets are are sort of orthogonal to the markets we're going after.

We've had a great relationship so far with the FDA on this.

We look forward to taking the next steps.

Okay. So second question relates to the cardio metabolic.

Field for you all so how do you think about the launch of Novartis and <unk> and <unk>.

How that influences how you would think about kind of the larger ambitions for drugs like arrow, apoc, III and narrow industry.

No so that's going to be interesting.

As you know of course.

<unk>.

Those.

The electrical markets are our sort of our thought going all to you in the markets. We're going after there is overlap of course, but but but it's not it's not the same market.

Javier San Martin: There is overlap, of course, but but but it's not it's not the same market. You know, I think that what we've seen there is that what we I think what we will see is that is that there is acceptance for a subcutaneously administered CV drug. Lepio appears to be a good drug.

I think that what we've seen there is that.

I think what we will see is that is that there is acceptance for a subcutaneous we administered the CV drug <unk> appears to be a good drug.

There are clear, there's clearly continues to be unmet medical need there but.

Christopher Anzalone: They're clear there's clearly continues to be unmet medical need there. But that's sort of, I think, as you know, as you know, as far as as as interpretation will go from from from watching what happens with that launch to to what our expectations are. You know, we're really focused on the markets that we think we can address here for ApoC3. It is it is, you know, FCS.

But that's sort of I think is.

As far as as.

As interpretation will go from from from watching what happens with that launch to to what are faced with what our expectations are we're really focused on the markets that we think we can address here for <unk> III.

Fcs.

It is severe hyper triglyceride mix, which we think is several million people.

Christopher Anzalone: It is severe hypertriglyceride mix, which which we think is, you know, several million people. The regulatory pathway is clear. The markets are clear.

The regulatory pathway is clear the markets are clear and then possibly mixed mixed dyslipidemia mixed dyslipidemia will see for <unk> III.

Christopher Anzalone: And then possibly mixed, mixed, mixed, mixed dyslipidemia. We'll see for ANG3, you know, there there is there is clearly, we think, you know, an opportunity for for treating those patients who still have have elevated LDL and elevated triglycerides. So, you know, we are we'll be watching the Lepio launch. But I but but I wouldn't say that that that we are dependent upon, you know, a blockbuster launch there to be confident in in the futures of these two drugs. Okay, great. Thank you. And thank you. And our next question comes from Maurice Raycroft from Jeffries. Your line is now open.

There is there is clearly we think an opportunity for for treating those patients who still have have elevated LDL and elevated triglycerides. So.

We will be watching that.

<unk>.

Launch, but but but I wouldn't say that.

That we are dependent upon a blockbuster launch there to be confident in the futures of these two drugs.

Okay, great. Thank you.

Okay.

And thank you and our next question comes from Maury Raycroft from Jefferies. Your line is now open.

Maurice Raycroft: Hi, thanks for taking my question. I'll do a two part question. So for the two new pulmonary programs announced today, are you using the same approach as ENAC with targeting integrin AB beta 6 on lung epithelial cells? And if so, how consistent or variable is this target in the new indications? And then can you talk more about why the new programs will require less total drugs? Yes, sure. So the answer to the first part is yes, we're still using the same targeting ligand approach.

Hi, Thanks for taking my questions I'll do a two part question. So for the two new pulmonary programs announced today are you using the same approach as inadequate targeting integrin.

<unk> six on lung epithelial cells and if so how consistent are variable as this target in the new indications and then can you talk more about why the new programs will require less total drug.

Thanks.

Maurice Raycroft: And there's no reason to believe that that would be any different across those two patient populations, across the various populations that we intend to address with Arrow RAGE and Arrow MOC5AC. So the second part of the question was, why are we confident that we'll be able to use less drug with the new program? Yeah, sure. So I think there's two reasons for that.

Yes, sure. So the answer to the first part is yes, we are still using the same targeting ligand approach and there is no reason to believe that that would be any different across those two.

<unk> populations.

Cross the various populations that we intend to.

Dress with her.

Harrow Rage in Air <unk> Sea and so the second part of the question was why are we confident that we will be able to use less drug with the new programs.

Yeah sure. So I think there's two reasons for that.

James Hamilton: One is the availability of readily measurable biomarkers for both of those programs for Arrow Mock 5AC and Arrow RAGE that will allow us to, I think, better understand where we are in terms of knockdown. That has always been a challenge for ENAC, that there's not a great biomarker to measure. I think the other aspect is that as we've learned more about the pulmonary platform, we have continued to gain an understanding of how much drug we can give and not see a tox signal.

One is the availability of.

Readily measurable biomarkers.

For both of those programs for Aero multiply they see an error rates that will allow us to.

Better understand where we are in terms of knockdown.

That.

Has always been a challenge for us.

Not not a great biomarker to measure I think the other half.

Spect is.

Is that.

As we've learned more about the pulmonary platform.

Have continued to gain an understanding of.

How much drug we can gear.

And Nazi Tox signal.

So relative to the dosing regimens, we were using in the <unk> program and if you might remember we were using the <unk> cycle.

James Hamilton: So relative to the dosing regimens we were using in the ENAC program, and if you might remember, we were using a day 1, 2, 3 cycle in both the clinical program and Talks Program, we're confident based on what we've seen that we can dose at lower levels and lower intervals and achieve the same level or better knockdown of the gene target. Yeah, yeah, I think that's the big take-home message that we expect to use substantially less drug and and administer it less often with these two drug candidates.

And both the clinical program.

The <unk> program.

We're confident based on what we've seen that we can dose at lower levels and lower intervals and achieve the same level.

Or better knockdown of the gene target.

Yes, I think that's I think that's the big take a message that we expect to use substantially less drug and and and.

Mr. It less often with these two drug candidates and also as Jim said, we'll have a we'll have a better idea about about depth and duration of knockdown, we're a bit flying blind with <unk>.

James Hamilton: And also, as James said, you know, we'll have we'll have a better idea about about defendration of knockdown. We are a bit blind blind with ENAC. And and so we were we were probably in those tox species.

And so we were probably in those tox species.

James Hamilton: We're we're probably we're probably, you know, pushing too much drug in there. And I think we'll have a we'll have a much better time here titrating that in humans as we you know, as we can see what not looks. Got it. Okay. Thanks for taking my questions. And thank you. And our next question comes from Ted Tenthoff from Piper Sandler. Your line is now open.

Probably.

Pushing too much drug in there and I think we'll have a we'll have a much better time here titrating that in humans as we've as we can see what it looks like.

Got it okay. Thanks for taking my questions.

Welcome.

And thank you Andy.

Our next question comes from Ted <unk> from Piper Sandler Your line is now open.

Ted Tenthoff: Great. Thank you very much. And thanks for all the updates. I want to get a sense for what we should be expecting on HIF-2Alpha at ASCO-GU coming up.

Great. Thank you very much and thanks for all the updates I'm wondering kind of a sense for what we should be expecting on hip to alpha.

<unk> coming up thanks, guys.

Yes.

Christopher Anzalone: Thanks. Yeah, so that that study is fully enrolled. And all patients are through their second biopsy, their post dose biopsy, so they get biopsy, pre dose and post dose. So we will share an update on, of course, safety and changes in a resist criteria, as well as, Chief Target Knockdown. So that's.

Yes, so that.

That study is fully enrolled.

And.

Sure.

All patients.

Through the second biopsy, where post dose biopsy.

The biopsy pre dose post dose so we will share.

Update on of course safety and <unk>.

Changes in the resist criteria as well as.

Gene target knockdown.

Christopher Anzalone: We'll be sharing it with you. And the highest dose level, I think, was double from the dose that we had. Presented. And so this was the highest dose that we intended to go. Yeah, this will be all three codes. And what's the total number of patients? We ended up enrolling the 27.

That's what we'll be sharing it with you.

The highest dose level I think it was double from the dose that we had previously presented and so this was the highest dose that we intended to go to this will be all three cohorts.

And what's the total number of patients.

We ended up enrolling 27.

Christopher Anzalone: Great. Perfect. Thanks, guys. Looking forward to the data. Thank you. And our next question comes from Mayank Mamtani from B. Riley Securities. Your line is now open. Good afternoon.

Okay perfect. Thanks, guys looking forward to the data.

Yes.

Thank you.

And our next question comes from the ink.

Tani from B Riley Securities. Your line is now open.

Mayank Mamtani: Thanks for taking our questions and congrats on the progress. So just maybe if I could clarify on the.., on the preclinical work on the rodent and monkey studies for RAGE-2 and MUC508. Have you conducted the same sort of studies where you saw the signals for ELAC? Did you say that work has already been done? Yes, or is ongoing.

Good afternoon, thanks for taking our questions and congrats on the progress so maybe if I could <unk>.

On the preclinical work on the road inbound Monkey studies for <unk> and <unk>.

Conducted the themes are the study where you saw the signal blog.

What do you say that work has already been done.

Yes or is ongoing.

James Hamilton: Okay. And just maybe a follow up there. Is that information you'd have before you get into the clinic?

Okay.

And just maybe a follow up.

What information you would have before you get into the clinic.

James Hamilton: We would certainly have to have.., toxicology studies that support the phase one dosing regimen. So to answer your question, yes. And on the chronic side, Mayank, we have some ideas about, you know, what doses would provide, you know, what knockdown and over what period of time. But again, here, with RAGE and with MUC5AC, we have the luxury of knowing that in humans.

We would certainly have to have.

Oxycontin <unk> studies that support the phase one dosing regimen.

So answering your question yes.

And on the chronic side Mike.

We have we have some ideas about.

What doses would provide what knockdown and over what period of time, but again here with rage and with much. Obviously, we have the luxury of knowing that in humans and so and so we have the luxury of waiting to see what the depth and duration look like before we.

James Hamilton: And so, you know, we have the luxury of waiting to see what the death and duration look like before we design those chronic tox studies and make sure that we are not administering substantially more drug than we would be in humans. Thank you. And then a financial question I had was about milestones that we could expect this year, and specifically from J&J and Amgen, you know, if they do decide to move into a next study, like, Two part question, like how much would be the milestone and then the timing of that, if you could remind us, that would be great. Yeah, we can't remind you because we never told you.

Before we design those chronic tox studies and make sure that we are that we are not administering substantially more drug then we would be in humans.

Thank you and then a financial question I had was about milestones that we could expect this year.

And specifically.

J&J and Amgen, they do decide to move into our next study.

Two part question like how much would be the milestone and then the timing of that.

If you could remind us quantity game.

James Hamilton: The we are, as you can imagine, Mike, our partners are sensitive about making those those or can be sensitive about making those milestones too granular. And so we've not been able to say publicly what, you know, what the various milestone levels are. And I apologize, but I really don't feel comfortable giving you guidance on when those could hit because those are J&J and Amgen's programs. Understand? Thanks for taking my questions. You're welcome.

Yes, we cant remind you because we never told you.

The.

We are as you can imagine Mike.

Our partners are insensitive about about making those those are can be sensitive about making those milestones too granular and so we've not been able to say publicly what what various milestone levels are and I apologize, but I really don't feel comfortable giving you guidance on when those could hit because those are those are J&J and amgen's programs at this point.

Yeah.

Understood. Thanks for taking my question.

Welcome.

Patrick Trucchio: And thank you. And our next question comes from Patrick Trucchio from H.C. Wainwright. Your line is now open. Hi, good afternoon.

And thank you.

And our next question comes from Patrick <unk> from H C. Wainwright. Your line is now open.

Christopher Anzalone: Just a follow up on the APOC 3 and END programs. I'm wondering if there's a possibility of evaluating these compounds in a combination treatment? And secondly, can you tell us your latest thoughts on the potential for partnering these programs and what form that could take? Sure. We are not currently considering combining the two drug candidates.

Hi, Good afternoon, just a follow up on the Apoc III and programs I'm wondering if there is a possibility of evaluating these compounds in a combination treatment and secondly can you tell us your latest thoughts on the potential for partnering these programs and what format can take.

Sure we are not currently.

Considering combining combining the two the two drug and we think that could be done, but but but we haven't done any any non clinical work by combining them and we're just not considering at least right now.

Our combined them.

Christopher Anzalone: We think that could be done, but we haven't done any non-clinical work by combining them, and we're just not considering, at least right now, clinical work combining them. With respect to partnering, look, we think, and I don't want to overstate this, but these two drug candidates almost feel like once-in-a-career opportunities. These really do feel to us like drugs.

I would expect to partnering.

Look we think and I don't want to overstate. This but these two drug candidates almost feel like once in a career opportunities. These are these really do feel to us like drugs.

Christopher Anzalone: Our data from the Phase I and II studies were quite good. The markets that these could help to address are clear.

Our data from our phase <unk> studies, where were quite good.

The markets that these could help too to address our clear the regulatory pathways are clear.

These are we think important new medicines and so we intend to hold onto these now.

Christopher Anzalone: These are, we think, important new medicines, and so we intend to hold on to these. Now, these will be expensive, particularly Ange, because we do recognize that Ange is going to require an outcome study, but given where we are now as a company, we are comfortable taking that burden on, given that we think the likelihood of success is high and these are important. So, at least right now, we are planning on holding on to these and building a commercial force to sell both drugs eventually. That's helpful. Thank you very much.

It will be expensive, particularly and because we do we do recognize that Andrew is going to require an outcome study, but given given where we are now as a company. We are comfortable taking that burden on given that we think.

The likelihood of success is high.

And these are important so at least right now we are we are planning on holding on to these in building our commercial force to.

Two to sell both drugs eventually.

That's helpful. Thank you very much.

Welcome.

And thank you.

Christopher Anzalone: You're welcome, and thank you. And our next question comes from Luca Issi from RBC Capital. Your line is now open.

And our next question comes from Luca <unk> from RBC Capital. Your line is now open.

Luca Issi: Oh, great. Thanks so much for taking my question. Congratulations on all the progress. A few quick ones.

Oh, great. Thanks, so much for taking my question and congrats on the progress.

Christopher Anzalone: One, maybe circling back on ENAC, it sounds to me that the safety signal that you've seen in rats was actually replicated in non-human primates. So I'm wondering if you can talk a little bit more about that and why you ultimately decided to switch horses, so to speak, here. And then maybe on A1AT, I want to make sure I'm clear. Is there a scenario where you can possibly file ahead of running a Phase 3, or do you think at this point running a Phase 3 is a must? And then maybe last one, on mixed dyslipidemia, why going after these indications for both H3 and ApoC3 and not maybe prioritizing one versus the other? Thanks so much.

Two quick ones, one maybe circling back on <unk>.

Sounds to me that the safety signal that you've seen in rats was actually replicated in nonhuman primate. So I'm wondering if you could talk a little bit more about that and why you ultimately decided to switch horses. So to speak here and then maybe on <unk> to make sure I'm clear.

Is there a scenario where you can possibly file ahead of running a phase III or do you think at this point running a phase III is a must and then maybe last one on mixed Dyslipidemia why going after this indications for both <unk>, three and apoc, III and not be prioritizing one versus the other.

Thanks, so much.

Christopher Anzalone: Okay, there's a lot there. So let me start with a T. You know, I don't want to speculate on that.

Sure.

There's a lot there so let me let me start with <unk>.

You don't want to speculate on that.

We.

We are interacting with the FDA. We've had so far has had a good relationship with them.

We'll continue to share data with them and have a discussion about what what the fastest and best way to bring this important medicine to these patients is going to be so stay tuned on that we'll let you know as soon as soon as we know what that is with respect to the mixed Dyslipidemia and both April and Ann So let me be clear on that so first with <unk>.

Christopher Anzalone: You know, we are interacting with the FDA. So far, we've had a good relationship with them. We will continue to share data with them and have a discussion about what the fastest and best way to bring this important medicine to these patients is going to be. So stay tuned on that. We'll let you know as soon as we know what that is. With respect to mixed dyslipidemia, and both APO and ANG, so let me be clear on that. So first, with ANG, this was always a focus for ANG.

It was always a focus for and given what we saw in the phase one two study given what we saw in non clinical studies and given what we've seen in the <unk> analysis, we know or at least we think we know that this drug is the drug candidate is good at lowering LDL and lowering triglycerides and theres a clear need for that so so we always saw it.

Big opportunity going after that very large market.

Christopher Anzalone: Given what we saw in the Phase I-II study, given what we saw in non-clinical studies, and given what we've seen in GWAS analysis, we know, or at least we think we know, that this drug candidate is good at lowering LDL and lowering triglycerides, and there's a clear need for that. So we always saw a big opportunity going after that very large market. Now, with APOC3, we are doing a Phase IIb study in that population.

Now.

<unk> three we are doing a phase <unk> study in that population, we don't yet know if we're going to do.

An outcome study to have to address that very large population, but what we wanted was optionality and so we're going to do the phase <unk> study, we're going to see what it looks like and then we can and then and then then if we do decide to do an outcome study would go ahead and do it rather than waiting a couple of years, while we have two phase <unk> study I think that Optionality is important I think it's worth.

Christopher Anzalone: We don't yet know if we're going to do an outcome study to address that very large population, but what we wanted was optionality. So we're going to do the Phase IIb study, we're going to see what it looks like, and then if we do decide to do an outcome study, we can go ahead and do it rather than waiting a couple years while we have to do the Phase IIb study. I think that optionality is important.

The money, we're spending on that phase <unk> study now.

Should that come to past that we do want to address that same general market with these two drugs I think it's a real benefit to be honest to have those two drugs because I think we're going to learn a heck of a lot in these phase <unk> studies and potentially in phase III studies about how these drugs work and what kinds of patients. They can help and so ultimately we're going to.

Provides a cardiologists lipid clinics potential.

Potentially at least.

Tools that they can that they can can use according to their patient's needs and so they can they can really provide specialized personalized healthcare. This is sort of a dream right.

Christopher Anzalone: I think it's worth the money we're spending on that Phase IIb study. Now, should that come to pass, that we do want to address that same general market with these two drugs, I think it's a real benefit, to be honest, to have those two drugs, because I think we're going to learn a heck of a lot in these Phase IIb studies and potentially in Phase III studies about how these drugs work and what kinds of patients they can help.

<unk>.

Christopher Anzalone: And so ultimately, we're going to provide to cardiologists and lipid clinics, potentially at least, tools that they can use according to their patients' needs. And so they can really provide specialized, personalized health care. This is sort of the dream, right, of health care.

Of healthcare and so having those two tools and using them as they see fit we think is a really important thing.

So so we see big opportunity there and also we want to we want to take that market share there may be other.

<unk> three or <unk> three inhibitors at some point in the future.

And we see no reason why we shouldnt take as much market share as possible.

Christopher Anzalone: And so having those two tools and using them as they see fit, we think, is a really important thing. So we see a big opportunity there. And also, look, we want to take that market share. There may be other ApoC-3 or Ang-3 inhibitors at some point in the future, and we see no reason why we shouldn't take as much of that market share as possible. And I'm sorry, what was the first question? In Erik, what did you see in Monkey?

And I'm sorry, what was the first question.

Yes.

What do you see in monkey.

Christopher Anzalone: Go ahead. Oh yeah, yeah. Okay, so look, we, you know, I don't want to go too much into that because we don't generally talk about Chilby Tox findings, but we did see some, we didn't see exactly what we saw in rats, but we did see some signs of some local lung inflammation. And as we talked about, you know, what I think was happening is we were just, I think we're giving more drug than we have to, to be honest, you know, this once a day for three days, you know, cycle was, was designed because we wanted to make sure that we had, we had, you know, a pretty wide berth once we see, you know, what defibrillation of the, of the knockdown was. We've learned a lot since then.

Oh, yes, yes.

Okay. So still look we don't want to put too much on that because we don't generally talk about about Jimmy talked findings, but we did see some we didn't see exactly what we saw in rats, but we did see some signs of some some are local lung inflammation and as we talked about.

What I think what's happening is we were just I think we're giving more drug then we have to do to be honest with this once a day for three days cycle.

Was was designed because we wanted to make sure that we had we had a pretty wide berth.

Once we see what depth and duration of that.

Of the knockdown was we've learned a lot since then and I think that thats.

Christopher Anzalone: And I think that that's probably, that we probably don't require that amount of drug and we probably don't require that frequent of dosing. So it gives us, it gives us confidence that, that for, for RAGE and MUK and potentially, you know, ENAC too, you know, not only do we have, I think, more potent drugs, but we have better understanding about, about how efficient it can be to, to, to deliver the drugs.

We don't require that amount of drug and we probably don't require that frequency of dosing. So it gives us it gives us confidence that FERC for rage, and mark and potentially enact too.

Not only do we have I think more potent drugs, but we have a better understanding about about how efficient it can be to deliver the drugs and so again.

Christopher Anzalone: And so again, we, you know, you don't know until you know, we don't know until we're in the clinic, but we do feel given, given the data we've got, both clinical and non-clinical, we feel, we feel optimistic at least that, that, that this platform, that these drug candidates will, you know, will, will be well tolerated and, you know, and, you know, important potential drugs. Copy.

You don't know until you know, we don't know until we're in the clinic, but we do feel given given the data we've got both clinical and non clinical we feel we feel optimistic at least that.

This platform these drug candidates will.

<unk> will be.

Well tolerated.

And important to report potential drugs.

Alethea Young: Super helpful. Thank you, Chris. And thank you. And our next question is from Alethea Young from Kanner Fitzgerald. Your line is now open.

Got it Super helpful. Thank you Chris welcome.

Welcome.

And thank you.

And our next question is from Lithia Young from Cantor Fitzgerald. Your line is now open.

Christopher Anzalone: Hey guys, thanks for taking my question. There are kind of two similar types of questions, but on this pulmonary franchise, it seems like you're kind of branching out potentially into, you know, bigger indications. So I just want to know kind of how you're thinking about building out a pulmonary business.

Hey, guys. Thanks for taking my question.

Somewhat.

Thanks for the questions, but on this pulmonary franchise it seems like you're kind of branching out potentially.

The bigger indications so I just wanted to kind of.

Christopher Anzalone: It's going to be pretty similar to kind of, you know, partnerships and collaborations, or now that you guys are longer, larger, and hopefully, you know, capital markets open up one day, you can get capital and do what you want to do for even big indications. And that kind of just broadens it out to the larger strategic question here. You have a lot of programs, you have a lot of collaborations, you know, you're moving forward in many different ways.

How youre thinking about building out upon like business is going to be pretty soon.

The kind of partnerships or collaborations or now that you guys are longer are larger and hopefully capital markets open up one day.

Given the capital and do what you idea of great and big indications.

Christopher Anzalone: And I just want to know if the strategy is the same, or do you guys think about keeping more of your, you know, kind of core assets in house? And do you also think about kind of building with bigger potentially, you know, I'll be at commercial opportunities where it may take a bigger investment on, you know, your expense side, but, you know, something that could yield like, you know, much bigger opportunities to things.

I would just broaden it out to the larger strategic question here you have a lot of program.

The collaboration.

You're moving forward in many different ways.

Wanted to know if the strategy of the same R&D guys think about getting more of your company.

A couple of core assets and how often do you also think about kind of building with bigger potentially albeit commercial opportunities where it may take a bigger investment.

Your expense side, but something that could yield.

Bigger opportunities there thanks.

Christopher Anzalone: Great. Sure. Thanks, Alicia.

Sure. Thanks Olivia.

Christopher Anzalone: You know, it's still early with pulmonary, but we like the space and we like the idea of building out a commercial for pulmonary. I think there are around 16,000 pulmonologists in the U.S., and when we look at that, when we look at what we think our pulmonary platform can do, we don't see two or three drugs. We see, you know, eight or nine drugs. And so we like the idea of building out a sales force to address those 16,000 pulmonologists who have eight or nine drugs in the bag. That's an efficient way, I think, to build a commercial force.

It's still early with pulmonary, but but we like the space and we like the idea of building out commercial for pulmonary.

They are around 16000 pulmonologists in the U S and when we look at that when we look at what we think our pulmonary platform can do we don't see two or three drugs, we see eight or nine drugs and so we like the idea of one building that sales force to address those 16000 pulmonologists.

Who have eight or nine drugs in the bag, that's an efficient way I think to build a commercial force. So right now we like the idea of holding on to those to those assets.

Christopher Anzalone: So right now, we like the idea of holding on to those assets. Look, the lung is a target-rich environment, and so it is certainly conceivable that enough targets will come up that we may want to partner with one here or there. But just strategically, that's how we're thinking about it.

The lung is a target rich environment, and so and so it is certainly conceivable that enough.

Enough targets will come up that we may want to partner one here or there.

But strategically that's how we're thinking about it.

Christopher Anzalone: You know, you've heard us talk about this before, that if we're going to build a company that I think that we should be building, we need to have, you know, a large, a relatively large number of important drugs that we commercialize ourselves. And so we're, you know, we're cognizant of that. We're not going to over partner.

You've heard us talk about this before that that that if we're going to build the company that I think that we should be building we need to have.

A large relatively large number of important drugs that we commercialize ourselves and so we're we're cognizant of that we're not going to over partner, we partner in order to to a get drugs to patients that we can't get them to very well and b to provide us capital. So we can we can afford to run our own programs and we will continue to use that.

Christopher Anzalone: We partner, you know, in order to, you know, get drugs to patients that we can't get them to very well, and B, to provide us with capital so we can afford to run our own programs. And we'll continue to use that partnering strategy, you know, in that kind of way. Alright, I appreciate that. Thank you. And our next question comes from Joel Beattie from Baird. Your line is now open. Hi, congrats on the progress and thanks for taking the question. The first question is on AeroRage.

Partner strategy.

That kind of way.

Alright, I appreciate that.

Welcome.

Thank you.

And our next question comes from Joel Beatty from Baird. Your line is now open.

Joel Beattie: How close is the relationship between the circulating AsterAge biomarker and activity in the lungs to be able to really help with pinpointing the dose? Yes, so the S-RAGE comes from two different origins. It's a splice variant that is secreted, or it's cleaved off of the actual RAGE receptor. It's a transmembrane receptor.

Hi, Congrats on the progress and thanks for taking the question first question is on Aero Rage, how close is the relationship between the circulating <unk> biomarker and activity in the lungs to be able to really help with pinpointing the dosing.

Okay.

James Hamilton: So by measuring the S-RAGE, we should have a very good idea of what knockdown of that receptor is. I hope that answers your question. Yeah, thanks. And as a follow up, how closely behind could the subcutaneous lung programs be to the lung administered programs?

Yes.

<unk>.

S Rage comes from two different origins of splice variant.

That is accreted or it's cleaved off of the actual range of receptor.

The transmembrane receptor so bye.

By measuring the S range, we should have a very good idea of what knockdown of that receptor is.

I hope that answers your question.

Yes.

As a follow up.

Closely behind could.

Subcutaneous lung program speed to the lung.

<unk> administered programs.

James Hamilton: Too early to tell on that, you know; these are early programs, and we're excited about them because, again, if we can make this thing work and make it scalable, it's a real breakthrough. And so it's a real focus of ours. We're not quite there yet.

It's too early to tell.

On that.

These are early programs and we are excited about it because again, if we can make this thing work and make it scalable.

It's a real breakthrough and so so.

It's a real focus of ours, we're not quite there yet.

So it's hard to tell how how far away we are.

James Hamilton: So it's hard to tell how, you know, how far away we are. I do expect that we will do, you know, we'll see what COVID looks like, but hopefully an in-person, you know, pulmonary focused R&D day or at least a webinar. At that point, I think that we'll be able to share some of our data. Again, we're excited about it, but we're still working. Great, thank you. Thank you. And our next question comes from Mani Foroohar from FVB Lyrics. Your line is now open.

Do expect that we will do.

We will see what color it looks like but hopefully an in person pulmonary focused R&D day or at least a webinar at that point.

I think that the wheel will be able to share some of our data.

Again, it's we're excited about it but but but we're still working on it.

Great. Thank you.

Thank you.

And our next question comes from.

Manny <unk> from <unk> Leerink. Your line is now open.

Mani Foroohar: Thanks, guys. So I'm digging through this ANG-PTL3 data from Ionis, which we also cover. They have previously shown 62% knockdown with their 80 milligram dose. We don't actually know what the 320 milligram phase 2B knockdown really looks like. We haven't seen that full data. But with you guys at 300, you showed 88% knockdown.

Thanks Scott.

Well im digging through this <unk> three data for my honest, which we also cover.

They have previously shown 62% knockdown with the 80 milligram dose we don't actually know what the 320 milligram phase to be knocked down really look like we haven't seen a full data.

With you guys at 388% knockdown subtle nuances around dosing, obviously in terms of frequency et cetera.

James Hamilton: Subtle nuances around dosing, obviously, in terms of frequency, etc. Given the commentary from Pfizer that suggests that perhaps, despite seeing impressive knockdown, they hadn't seen that translate.., to Reproducing the Level of Clinical Benefits on Triglycerides, Non-HDLC, etc. Are there specific data sets that you guys look at that suggest the knockdown that you're seeing will translate to those clinical benefits when they did not in the larger clinical trial that Pfizer showed? And I have a quick follow-up.

Given the commentary from Pfizer suggest that perhaps despite seeing impressive knockdown they hadn't seen that translate to.

To reproducing the level of clinical benefit on triglyceride, non HDL C et cetera.

Are there specific data set that you guys look at that suggest the knockdown that you're seeing will translate to those clinical benefits when they did not in the larger clinical trials with Pfizer show and I have a quick follow up.

James Hamilton: Well, we have what we presented, the LDL and non-HDL data and triglyceride data with that level of knockdown in the 80 to 90% range from the 200 and 300 milligrams dose. So the non-HDL and LDL data is clearly superior to what Ionis had presented in the past, but we don't know what is this current data exactly. So we do believe that there is at least three different sources that speak to the correlation between the level of knockdown or the level of suppression of HPTL3 and the pharmacodynamic effect.

Well, we have what we presented the LDL and non HDL data and preclinical data with that level of knockdown in the 80% to 90% range from the 200 and see kind of the immediate.

Dose.

The non HDL and LDL data is clearly superior to what <unk> presented in the past, but we don't know.

This current date exactly so and we do believe that is at least three different services.

To the correlation between the level of knockdown or deliver the creation of <unk> III and the Pharmacodynamic effect that she was study the regenerative on data and the comparison so far between the ion is in our data. If you look at the agenda on data they do need to those really high to get to a level of sufficient to achieve.

James Hamilton: The GWAS study, the Regeneron data, and the comparison so far between the Ionis and our data. If you look at the Regeneron data, they do need to dose, to the talk! Yeah, and I think so if you look, again, it's very difficult to compare these because we haven't seen their data really. And, and there's these two separate studies, but, but you know, you look at at their dosing once every two weeks, or once every month, or dosing every quarter, and potentially less for, Second, you look at ALT increases. We had two patients with ALT increases, and we think we know why that was. We think it was related to other medications those two patients were on.

The Pharmacodynamic effect and we did see a dose response in our case as well and again as I said that she was the differentiation between the hit neuroscience I call multi which is quite clear. So I think this is a target with the magnitude of this target sufficient correlate with the clinical or the pharmacodynamic effects.

And I think so if you look again, it's very difficult to compare these because we haven't seen their data really and these two separate studies, but but youll look at at their dosing. Once every two weeks or once every month, we're dosing every quarter and potentially less frequently.

Sure.

Second.

Looking at <unk> increases, we had two patients with LTE increases when we think we know why that was so we think it was related to other medications. Those those two patients were on so we think that that difference.

James Hamilton: So we think that that's different. Third, we haven't seen increases in liver fat. It sounds like they did.

Third we haven't seen increases in liver fat it sounds like they did.

James Hamilton: And so I think this is a good example, broadly, of the advantages of RNAi over antisense. I think whenever you can compare those two modalities, RNAi leads to deeper and more durable knockdown. The safety profile, you know, if the sequences are chosen correctly, can also be favorable. So we feel great about the candidate. We still feel great about the target, as Javier points out, because the GWAS data, as well as other data.

And so I think this is I think this is a good example, broadly of the advantages of RNA eye over antisense I think I think whenever you can compare those two modalities arent AI is is leads to deeper and more durable knockdown safety profile.

If the sequences are chosen correctly can also be favorable so look we feel great about the about the candidate we still feel great about the target.

As Javier points out to get the <unk> data as well as other data.

James Hamilton: Yeah, so that makes sense to me. But what I was trying, what I'm trying to understand, so the what we have is limited to a press release, obviously, from Pfizer, they didn't hold a formal event, the commentary around what they saw as, you know, clinically justifying going into a large complex phase three, how do you think about what your threshold would be? around what would be a number that justifies going in a phase three in a broad patient population as opposed to like something like a more narrow and issue-defined population. Like what are the specific do you think the numbers that you previously showed are adequate or do you think pursuing a higher deeper more aggressive knockdown even than what you've seen so far? Look, we'll see.

Yes.

That makes sense to me.

But what I was trying what I'm trying to understand so the.

What we have is limited to approximately it's obviously from Pfizer.

The formula events, the commentary around what they saw.

Clinically justifying going into a large complex phase III.

Do you think about what your threshold would be.

Around what would be a number that justifies going into phase III in a broad patient population as opposed to doing something like a more of a more narrow and Mitch you defined population.

Like what are the specific the number that you previously sort of adequate or do you think pursuing a higher deeper more aggressive knockdown, even though what you've seen so far is necessary.

James Hamilton: We'll take a look at our Phase 2b data. You know, we've seen LDL reduction of as much as 50%, you know, mean reduction of as much as 50%. You know, we've seen, you know, triglyceride reduction, you know, and I think in the 70 or so percent range, something like that.

Okay.

We'll see.

Take a look at our phase <unk> data, we've seen LDL reduction of as much as 50% mean reduction by as much 15%, 50% we've seen we've seen.

Triglyceride reduction and I think in the 70 years or so percent range something like that.

Those are those are substantial now we're not going to see clinical outcomes in a short study and so I don't so so.

We're dependent upon these surrogate endpoints, but I think those are I think those are substantial you look around at other triglyceride lowering agents and theres just not much out there.

James Hamilton: You know, those are substantial. Now, we're not going to see clinical outcomes, you know, in a short study. And so I don't, so, you know, we're dependent upon these surrogate endpoints. But I think those are, I think those are substantial. You know, you look around at other triglyceride lowering agents, and there's just not much out there, you know.

And I think that.

If our data this way I think of our data continue to.

<unk> rollout the way we've seen them so far in the phase one two study I think that that would be that that would be.

Give us good confidence to go into a into a an outcome study.

Great that makes sense to me thanks for taking the questions guys.

Welcome.

James Hamilton: And I think that if our data, put it this way, I think if our data continue to, you know, to roll out the way we've seen them so far in the Phase 1-2 study, I think that that would be, that that would give us good confidence to go into a, into a, an outcome study. Great, that makes sense to me. Thanks for taking the questions, guys. You're welcome. Thank you. And our next question comes from Keay Nakae from Chardon. Your line is now open.

Thank you and our next question comes from key Mackay from Chardan.

Line is now open.

Keay Nakae: Yes, thank you. Two questions. First, SubQ Admin to the long. Are you using the same, Conjugate targeting ligand for integrin.

Yes. Thank you two questions first sub Q admin to the lung are you using the same.

James Hamilton: Are you evaluating something different? And is the primary performance objective a better safety profile? Yeah, so so I can't answer the first question, because because we are, you know, we're, we are playing around with with various, various ways to do this. And so, you know, hold off. And when we when we present, we can we can talk more about it. So so I wouldn't say that we're looking for a better safety profile. That's a good question. It's not it's not as though we're afraid of the inhaled route. But it just makes our life simpler, right?

Conjugate targeting law again for integrin are you evaluating something different and is the primary performance objective a better safety profile.

James Hamilton: You know, if we can administer this via subq, there are there are, you know, unknowable questions that you don't have any longer about about, or unanswerable questions that we don't have anymore, with respect to to to a safety profiling talks in talks animals. And so it does make our lives easier. But also look, it's, it's an easier mode of administration for for, for potentially, you know, all indications, you know, rather than using a nebulizer, which which is still relatively light touch, but still requires having having a machine and, and require some time, that's just more cumbersome than than a simple subq injection.

Yes.

So so I can answer the first question because because we are.

We are playing around with various.

Various ways to do this and so hold off and when we when we present, we can we can talk more about it.

So so I wouldn't say that we're looking for a better safety profile.

It's a good question it's not.

Not as though we are afraid of the inhaled route but it just makes our lives simpler right.

If we can administer this via sub Q.

Or are there are unknowable questions, but you don't have any longer about about.

Our unanswerable questions that we don't have any more with respect to safety profiling talks and talks of animals and so it does make our lives easier, but also look at it.

It's.

It's an easier mode of administration for four.

James Hamilton: That could be, you know, who knows once every two weeks, once a month, once every three months, whatever that's going to be, that's just a more convenient mode of administration. We think that that that would be just a massive breakthrough in this field. And again, I don't want to oversell it because we're not there yet. But we but what we've seen so far has told us that we want to continue to explore this.

Or potentially all indications rather than using a nebulizer, which which is still relatively light touch, but still requires having them having a machine and requires some time, that's just more cumbersome than a simple sub Q injection that could be who knows once every two weeks once a month. Once every three months whenever that's going to be not just a more.

Convenient mode of administration, we think that that would be just a massive breakthrough.

This field and again I don't want to oversell, it because we're not there yet, but we but what we've seen so far has told us that we want to continue to explore this.

James Hamilton: Okay, great. And just just clarification on the upfront from GSK, the 120 million you received in January, how much of that will be recognized as revenue in fiscal Q2? And how much might be amortized over some period of time?

Okay, Great and just a clarification on the.

Up from from GSK. The 120 million, we received in January how much of that will be recognized as revenue in fiscal Q2, and how much might be amortized over some period of time.

Keay Nakae: Thanks. Sorry, can you repeat that? The $120 million upfront from GSK you received in January, how much will be recognized as revenue in fiscal Q2 versus how much might be amortized over a period of time?

Sorry can you repeat that.

The $120 million upfront from GSK received in January .

How much will be recognized as revenue in fiscal Q2 versus how much might be amortized okay.

Jim.

Ken Myszkowski: Probably all of it will be recognized in fiscal Q2. Our performance obligations are basically complete for that for that milestone that we have received. Okay, great. Thank you. Thank you. And thank you. And I am showing no further questions.

Probably all of it will be recognized in fiscal Q2, our performance obligations are basically complete for that.

For that.

Milestone that we received.

Okay, great. Thank you.

Thank you.

Christopher Anzalone: I would now like to turn the call back over to Chris Anzalone for closing remarks. Thanks very much for joining us today. It's always a pleasure to speak with you and we look forward to talking to you next quarter. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.

And thank you and I'm showing no further questions I would now like to turn the call back over to Chris Anzalone for closing remarks.

Thank you very much for joining us today, it's always a pleasure to speak with you. When we look forward to talking to you next quarter.

Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.