Q1 2022 EQRx Inc Earnings Call

Speaker 1: How.

Speaker 2: Good day and welcome to the EQRx's first quarter 2022 financial results conference call. At this time, allll participants on Al listen only mote. After the speaker's presentation, there ll be a question-and-answer session. Ask a question during the session. You need to P Star than one and your touch on telephone. If anyish to require assistance during the call, please press star, the zero reat operator. As a reminder, this call may be recorded. I would like to turn the call over to Neil swaming, Head of Investor Relations. You may begin.

Speaker 3: Thank you operator, and good morning everyone. Earlier today, we issued a press release providing an overview of our first quarter 2022 financial results and our recent corporate progress. A copy of this release and presentation to accompany this call are available on the Investor Relations section of our website at investors- EQRx com.

Speaker 3: Joining me on the call this morning: our Melanie military President and Chief Executive Officer.

Speaker 3: Jamie Ruben, Chief Financial Officer, and DR Eric Hedrick, Chief physician executiive.

Speaker 3: Before we get started, I would like to remind everyone that some of the statements that we make on this call and information presented in the slide deck include forward-looking statements as outlined on Slide two.

Speaker 3: Actual events and results could differ materially from those expressed or implied by any forward-looking statements. As a result of various risks, uncertainties and other factors, including those set forth in our most recent filings with the SEC and other future filings that we may make with the SEC, you R cautioned not to place any undue reliance on these forward-looking statements, and EQRx disclaims any obligation to update such statements. I will now turn the call over to millany.

Speaker 4: Thank you, Neil. Good morning everyone and thank you for joining us for our first quarterly investor conference call.

Speaker 4: Turning to Slide 3, our mission is to improve health for all with great innovative, affordable medicines.

Speaker 4: We're doing this by creating a network of payers and health systems that are true partners to us. Our global buyys club.

Speaker 4: They help drive the pull-through of our therapies for patients.

Speaker 4: Our platform aims to align incentives across the health care ecosystem and create true population level access.

Speaker 4: By offering radically lower prices, we are enabling our global buyers club members to pull through and the more they save, the more their patients save, generating greater volumes for eqx.

Speaker 4: And we are doing this at scale. Our aim is to create a large catalogue of high-quality brain of medicines that are equally good or better than what is currently available to patients.

Speaker 4: Our focus is on addressing high-cost diseases of today in tomorrow, starting with cancer and immune inflammatory disorders.

Speaker 4: Simply put, we are providing a market-based solution to address the rising costs of prescription medicines around the world.

Speaker 4: We believe this platform will enable eox to be a profitable and sustainable company.

Speaker 4: Moving to our performance in the first quarter, our team continued its relentless focus on execution.

Speaker 4: We made great progress in advancing both our future catalogue of medicines and the global buyers club.

Speaker 4: We would like you to come away with three key takeaways from today, as outlined on Slide four.

Speaker 4: First our lead oncology programs. Our molarknip and sugar alamab are differentiated programs with promising clinical evidence.

Speaker 4: Constructive conversations are ongoing with the FDA to create greater clarity on the regulatory path forward in the U's. We will share additional details when appropriate.

Speaker 4: Outside the? U's. We remain on track while first regulatory submissions for these programs during the second half of this year. Our mission is global and there are important and sizable market opportunities outside the U? S.

Speaker 4: We look forward to next month's ASCO amnno meeting, where new data will be presented for alerk ne and suar anamap, including an oral presentation featuring sug alamapab in relapsed or refractory enktl, a reotype of lymphoma with no FDA approved therapies, as well as the first presentation of sugar anomab interim overall survital data from a prespecified analysis in previously untreated stage four non-small cell lung cancer.

Speaker 4: Second Turning to our global buyas club, we converted our first memorandum of understanding to a precommercialization agreement and we will continue to work to progress other us to this next phasewe have multiple discussions ongoing and pay on health system. Interest in our progams remain strongthird. We are very fortunate to be in an exceptionally strong financial position. We endeded Q1 with one point six billion in cash and cash equivalent, are on track to achieve four million ls of operating expenses in 2022 and continue to expect to have cash runway into 2, twentthousand and twenty-five.

Speaker 4: With that introduction, I will now turn the call over to Eric, who will discuss our alerk ith and sugar alammap in greater detail. Eric thanks, melany. I'll begin with almer worki on Slide five.

Speaker 5: As many of you are aware, amalerive is a third generation E GFR inhibitor intended for the treatment of patients with advanced eGFR meut, ated non-small cell lung cancer.

Speaker 5: In the Phase three EES trial, alant was shown to provided a clinically and statistically significant improvement in progression pre survival. The endpoint of clinical and regulatory interest in the initial treatment setting of metastatic EGFR mutated on cancer.

Speaker 5: Consistent with our malerants' metabolic profile. The study also suggested that Al maler might provide an advantage over currently available efr inhibitors with respect to toxicity such as rational diarrhea.

Speaker 5: We're looking forward to a presentation with the upcoming ASCO annual meeting and data from the enees trial describing the benefit of amaler hadbeen patients' bringment asticities.

Speaker 5: Given the frequency of brain metastases in this type of lung cancer, with the significant morbidity and profound quality of life impact associated with brain metastases, robust benefit in the setting's turmoil.

Speaker 5: With respect to additional evidence generation, in the second half of this year we are planning to initiate a randomized multiregional U slike clinical trial which will evaluate the clinical comparability between aler and have been o smerib, with a third study arm assessing the potential clinical benefit of the addition of chemotherapy to alertib in the first-line metastatic treatment setting.

Speaker 5: This study, designed to enroll a diverse and inclusive patient population, will address the applicability of the results. The NES trial to current U's medical practice will also assess potential tolwerability differences between these two third generation efr inhibtors.

Speaker 5: This study will also evaluate important questions regarding the optimal use of EGR andinhibptors- this treatment of this disease.

Speaker 5: In addition, a clinical trial in the azj treatment setting of each egffr muted lung cancer is ongoing in China and we are planning to expand this study to include multiregional enrollment.

Speaker 5: Given the magnitude of benefit established with other efr inhibttorus. In the setting establishing the efficacy and safety of Al alerib and assessing the impact of potential safety differences on tolerability, a critical consideration in patients with earlier stages of disease will be important in understanding the role of Al alertib in the breadth of management of egfr- mutated lung cancer.

Speaker 5: We are continuing to engage with various regulatory authorities across the world around potential filings for approval in the U K. for example, we have received innovation Passport designation for aallived from the mha, which provides an opportunity for coordinated review amongst agencies and the expedited review process.

Speaker 5: Based on the nature of the discussions with regulators outside the U's, we remain confident that we are on track for our first submissions in the second half of this year.

Speaker 5: We also continue what we consider to be a constructive dialogue with the? U's FDA regarding conditions under which alma alerinnet may be filed for approval.

Speaker 5: Understanding that there are concerns about the applicability of single-country exu's data to current U's practice. We are committed to addressing these concerns and are working with the FDA to define a path to U's approval for Al the ordment.

Speaker 5: I'll now turn the Slide six to discuss serironalab.

Speaker 5: cizarre, anti-pdl one monoclonal analbody for the treatment of nonsmall cell loneg cancer and other diseases.

Speaker 5: As a reminder, chgamalaab has completed two large Phase three studies: one in stage 4- non-small cell lung cancer, in the other in stage 3, non-small cell lung cancer. Note that chigamalaab has also been evaluated in a now completed pivotal study in re, laps refractory extra notal N kt cell lymphoma, a rare type oflymphoma with no approved therapies.

Speaker 5: As Melanie mentioned, we are looking forward the two key presentations of new sugam alinab data at ASCO. This includes the first presentation of interim overall survival data of the pivotal Phase three gemstone three hundred two study of sugam alabin combination with chemotherapy and previously untreated stage four lung cancer.

Speaker 5: Recorded. In January we announced at sugar ammalamab combination with chemotherapy that demonstrated a statistically and clinically significant overall survival improvement in patients stage four disease, including patients with both slaimness and non-sous asttology.

Speaker 5: Of note. These overall survival findings were based on a prespecified alpha controlled analysis, which is an important regulatory consideration. Also at ASCO there will be an oral presentation featuring the primary analysis from the Phase I gemstone I a one study or suamalab and relapseed a refractory extra notal and kt sold foa. This trial metits primary endpoints of objected response rate and response duration in patients with relapsed a refractory en ktlthese two ASCO presentations will add to a growing body of clinical evidence for suicamalenab a a number of different cancer treatment settings.

Speaker 5: We also anticipate additional Phase three suigamal AD data in the not two distant feature. This includes overall survival results from the gemstone prio one study evaluating suigamalm in the maintenance setting following chemother radiapy for stage three notal So lung cancer. Again, these results will be from a prespecified analysis and are expected in 2020 , -.threeimportantly, the study evaluate suamalad following either sequential or concurrent che radiotherapythe inclusion of patients who had received sequential cheradiapy is of particular importance, as the population enrolled in this study is reflective of current? U's practice in which approximately 40% stage three patients in the? U's received chemorotherapy in sequential fashion.

Speaker 5: To date, other immune checkpoint inhibitors have been studied and approved only as maintenance therapy following concurrent chemo rated therapy. We are also supporting an expanded access program in en ktl that is open the patients in the? U's, which reinforces our commitment to addressing medical needs. A regulatory submission for reoster fractory nktl is expected in the? U's in 2023 and, as a reminder, suigamalab was granted breakthrough therapy designation by the FDA for N ktl.

Speaker 5: To further go on chamalab's body of evidence, we are planning to initiate a U's led randomized clinical trial that is intended to support a future U's filing, in consultation with the FDA, which will provide comparative data for chicamalinab with other approved mean checkpoint inhibitors and into diverse and inclusive population of non-small cell lung cancer patients.

Speaker 5: Regarding regulatory processes for sugamalab, we are continuing to engage with regulatory authorities across the globe around potential filings and approval and nonsmall cell lung canceras I mentioned. These are important in robust market opportunities. We remain on track for our first submissions for sugamal and have outside the? U's in the second half of this year.

Speaker 5: We also continue what we consider to be a constructive dialogue with the? U's FDA regarding conditions under which sugamalaab may be filed for approval in the? U. sunderstanding that there are concerns about the applicability that single-country X? U's data to current? U's practice, we are committed to addressing these concerns and working with the FDA to find a path for approval for almoy.

Speaker 5: And with that I will turn the call back over to balloy. Thanks, Eric. Moving to Slide 7, as you can see we are building a robust pipeline which includes multiple clinical stage programs beyond alerknet and sugar adamup. We currently have more than 10 ongoing programs, five of which are in the clinic, addressing some of the highest soft areas in oncology and imune inflammatory diseases.

Speaker 4: These other clinical stage programs include no fuzen limma, a PD 1, also known as E Q1, 7- six for solid tumors, nor a sicklip, a cdicate for six inhibtor for metastatic breast cancer. E Q1 to 1, a highly selective check one inhibitor for imme inflammatory diseases. We plan to provide a more comprehensive update on our clinical stage pipeline during the next squally earnings call.

Speaker 4: In addition to in-licensing, another source of therapy candidates in development is to create molecules from scratch against targets of interest, through our early-stage RD collaborations with leading drug engineering companies.

Speaker 4: We have signed collaboration agreements with now six of the leading drug engineering platform companies, including exxentciia ecelera, Relay therapeutics ESI, eoac and, most recently in silico medicinewe will leverage each partner's different computational platform approaches for small molecule protein and antibody-based drug discovery to create new molecules for eorx. We believe these collaborations provide a capital-efficient way to build our pipeline and will provide sources of revenue in the future.

Speaker 4: Let me now turn to Slide eightas I mentioned at the beginning of the call, we continue to make progress in assembling our global bias clubwe're entering into long-term trusted strategic partnerships with private and public payers and health systems So they and the patients they serve can gain access to our future medicines, when approved at radically lower prices.

Speaker 4: In the first quarter we converted our first memorandum of understanding to a precommercialization agreement, where we have now finalized the details in key terms of the partnership, after establishing a roadmap in the outhese terms will then be implemented upon receipt of necessary approvals, which provides for broad access for the partners's members.

Speaker 4: Demand remained strong for high-quality innovative medicines at dramatically lower prices, and we look forward to keeping you updated on our progress.

Speaker 4: I will now turn the call over to Jamie to discuss our financial position.

Speaker 6: Thanks Melanie. On now, on Slide 9, a summary of our first quarter two million two financial results can be found in the press release that we issued this morning. More detail is included in our 10 -q filing, which we will file later todaywe ended the first quarter of 2022 with approximately one point six billion in cash and cash equivalenttotal operating expenses were 86 million, versus two thousandtwenty-seven million for the same period a year. agor ND expenses accounted for over 60% of our spend this quarter. As we continue to advance our portfolio, ramp-up clinical trials across all stages of development and build important infrastructure to support our operationsfor the full year, we continue to expect four million or less in operating expenses, which assumes initiation of comparative studies in the second half of this yearto reiterate Melanie's earlier comment, we are very fortunate to be in an exceptionally strong financial position, which will enable us to grow.

Speaker 6: Thoughtfully shape our portfolio and enable us to get through significant development and commercial milestones. We expect to have cash runway into 2025. to that end, we will continue to be disciplined and managing our spend and continuously evaluate our portfolio. That means that we will look to selectively add or advance a pipeline program if it meets our strict criteria of what makes in each Rx medicine. It addresses a high cost burden. It represents a therapeutic area of known and causal mechanism of action. It has potential to demonstrate equal or better clinical evidence to existing drugs in this class, if patent protected, with sufficient patent runway, and provides us with the opportunity to to capture significant market share. Now, moving to Slide 10, I would like to reiterate today key takeaways and summarize the multiple milestones we are expecting for the remainder of 2022. As you heard during the call today, These include our first regulatory submissions outside the U's for omomelar to live and sugarab.

Speaker 6: The planned initiation of our first comparative studies, additional data presentations and read as including those at the upcoming ASCO meeting, and continuing to add members to our global buyers club. Let me now turn the call back over to Melanie. Thank you, Jamie. In closing, I would like to thank all of our employees, partners and stockholders for your support. We can now go ahead and turn the call back over to the operators So we can take any questions operator.

Speaker 7: As your reminders ask the question. Please firstress Star than one if your question has an answer and you like to re yourself in the queue, press the townt key. Our first question comes from Steve Scala was Cohen, your line is open.

Speaker 8: Thank you and congratulations on all the progress. I have two questions. First, when we see the gemstone 3: two data at ASCO, should we expect median OS to improve or decline versus what was presented at world lung?

Speaker 8: And maybe as a second part to that first question, more generally, versus data we have seen for moer B and chgamala mAb previously, what should be our expectations for data at ASCO? So that's the first question. The second question is based on conversations with FDA. So far is there a maybe small but non-zero chance further trials won't be needed.

Speaker 8: And if the chances are zero then, as FDA, guided to any particular design. Thank you yes, that. Thanks for the question, Steve. This is Eric. With respect to the first part of your question, jmsttownone three 2: yes.

Speaker 5: Wouldn't speculate on things relative to previous presentations to the data, but the overall survival improvement we believe is robust in compelling both clinically and and statistically and that's what you should expect to see at ESCO.

Speaker 5: You know we, reregarding your question about the F D a, you know we're operating under the premise that we will need to produce additional data to address applability right. That's being clear. And part of the process now in discussion with the F D a is defining exactly what that looks like and it has elements of diversity inclusivity, the? U's population, it all also has elements of, you know, the comparor, submer for moer and and other checkpoint inhibitors for sugar, alab and those design issues, those analysis issues, are exactly the subjectiveof conversation with the F D a and Steve. This is now only. I just want to add one comment. As you know, with our unique business model, generating additional evidence such as what we're proposing.

Speaker 4: Is really helpful when you think about it, both for the physician community really helpful our partners to further their efforts in helping create that pull-through that we've been talking about and creating the adoption. So there is a reason that goes beyond regulatory for us to do these studies and we're actually very, very excited about these studies because we think this is the kind of clinical evidence that many of the stakeholders in our ecosystem are looking forward tothankyou.

Speaker 1: Our next question comes from Chris Scot with JP Morgan, youran is open.

Speaker 9: Great's so much. Just a couple questions here about the kind of X? U's opportunity given, sincems like that's going to be where your first filings are coming in. So maybe just first can you just talk about how quickly you'd expect a U? K ramp to play out for your medications, assuming all goes well with the filing and approval. I just trying to get any hands around the kind of steps to get reimbursement and commercialization in place, as a is kind of trying to translate. You know how we think about second half approvals and then when we could see kind of relevant commercial revenues coming out of those. And the second question: mean the same vein in the U? K has provided you with accelerated pathway for the application? This we think maybe more broadly about Continental Europe . How attractive of an opportunity are those markets for your products? And are there particular countries we should be thinking about where either the payer or reimbursement systems that would be particularly favorable to an yoururax type of model? Thanks so much.

Speaker 4: yesit' Chris. Good morning, this is Melanie. Thank you for both of these questions. First of all, as you know, as a very young company that has not yet commercialized therapy, I think it's. It would be getting a little bit ahead of over our skis to talk about exactly what our ramp looks like. Having said thatwith 65 million lives in the U K, and given our population helps partnership that we're going to work on with the NHS, we believe that that is really fertile ground to we much broader access to innovative cancer therapies and, as you know, because we've previously talked about it in the U K in particular, there's an important strategic goal that the U K has: to expand cancer care and to extend cancer survival.

Speaker 4: And we are a key part of reaching that goal. So I would say we all win- patients, of course, first and foremost, but the NHS and we will equally win if we have a better and faster ramp, and of course that's what we're hoping for. For your second question on Europe , first of all let me just put some parameters around your question and then come back to the question around attractiveness. So if you look at insured lives in the OECD countries alone, then the us is less than 25%, 23% to be exact. Europe is close to 40% and all other oecb countries include another close to 40% of insured lives.

Speaker 4: So those are really big markets if you look at it in terms of the number of lung cancer cases. So what I'm quoting now are 2020 new lung cancer cases. The? U's is at 15%, or 14 cent to 15%. Europe is about a third. Apac, excluding China, is about a third, and then you have the Latin American and African market. So all of that again to just re and force that, the opportunity in Europe in particular, which you were asking about, is really sizable and very attractive to usnow. With regards to the question around in which order or how would we prioritize them, as you would imagine, size of course matters, but at the same time, what also is important to us and goes back to our mission is that in some of these countries, you actually don't have the same choice that we have here in the United States.

Speaker 4: So in some cases you may not have as many, or in some cases no, checkpoint inhibitors or you may not have a third generation in you of our inhibitors. So for us it's also important that we are doing the right thing and we are bring an option forward to patients where perhaps today there may not be an option, and that in turn, we believe, creates opportunity for us, because those stakeholders we believe are very going to be very interested in what we have to offerthanks so much.

Speaker 1: Our next question come from across to war with Jeffrey. Your line is openhi am wer cost's, So which for taking your question. So just on the head to head trial, can you go over how you're defining the problem? You mentioned today that the study is aiming to apply prior generated data to U's current medical practice in a diverse population. How, how are you planning on addressing this in the design of your head to head? And additionally, can you kind of go over what the threshold fornon theurity is for these studies and if there could be some flexibility of statistics are powering for these studies? Thank you so muchyou it, sric. Thanks for a question you, I think you know. So we there's a few things to say. 1, you know we anticipate the trial that will directly compare around thealordment with those to initiate.

Speaker 5: In the second half of this year and obviously that would be posted on clinical trials go and that would give you a lot of insight into the specific design detailsi' come back to the point that again, what these trials are trying to do is address applicability, and applability has a couple of Maine components. one is representation of a study. Population is representative of the? U's right- that da has been pretty clear about thatand So just the composition of the patient population would be one important factor. The second element is comparabilitynote that I use that term and not necessarily noninferiority, but comparability to the current standard. And that's an area where I would say there's the most focus on our continuing discussions with the F? Da.

Speaker 5: How does that define? What does that look like in terms of efficacy? What does that look like in terms of safety? And I think that the design issues here a little bit more complex than one would see in the study that was just establishing safety and efficacy, which is not the point for these drugs. These are safe and effective ugs. This is about applicability. So I think the brief answer your question is: we're looking at both those elements in the design. We're discussing those design issues that the? U's FDA. We're confident that we'll be able to reach alignment on how comparability and diversity is addressed in the study and again we're lookingping that initiate that study in the second half of this year, I think. Thank you for my.

Speaker 1: Our next question comes from Eric Percher, with nephon research. Your line is open.

Speaker 10: Thank you. The question on the buyers' club and the move toward commercial agreements as we see, moving OU to pre commercial, what mechanisms are you building into the agreements to drive the pull model that you've talked about? What advantagees relative to simply having payer coverage DC.

Speaker 11: Eric good morning and thank you for the question M is melany. As you know there are a pretty wide range of levers that payers and health systems have at their disposal. All of them are very impactful. There is a slight difference if you look at it from a regional payer point of view in the U's to a national payer to a national payer. You may include a pharmacy or PBM businessversus for instance an integrated delivery network or a single payer system with universal health care coverage. But I would say in all of those just going back to the fundamentals and the key principles. Everybody ends up winning if we see greater adoption. So if.

Speaker 4: We see greater adoption and they truly create the pull through than they generate greater savings because they're effectively replacing a higher cost unit. If you will by a lower cost unit. Secondarily we will see a positive impact for patients because one of our important goals is to lower the out of pocket burden for patients where that is an issue such as in United States. Perhaps less so in certain European countries and ultimately of course it drives volumes for E qax. So the the levers may differ ever so slightly but they all levers to make it really clear that it is better to leverage and equally good or better medicine at radically lower prices OK and when we look at.

Speaker 10: The pace of progress on the development side. Have you seen any impact to the pace of commercial development? And I know that early on you said you would talked to us when there are a new typeof agreements? Today we have the precommercial, but any commentary on increasing penetration of the type she called out in the past- regional national health system, that gets you, on the past, from hundred and eight million to 35 million loss.

Speaker 4: yesi'll answer both of these questions Eric. This is now on, first of all, in terms of the pace of progress. Part of the reason we wanted to lay out on on the slide that we shared how this process works is because it is a new process and it's a very different process from what we're seeing today or what we've seen up to now. In most cases for innovative medicines, where they get develoved, take that regulatory approval and very shortly before that, but then also very much post that regulatory approval, the biopharma company engages with payers and really is focused on getting reimbursement coverage, and that can sometimes take up to three months in the United States when PNT committees review these new drugs and make those reimbursement decisions.

Speaker 4: In our case, it's a really different way of partnering and therefore the upfront work, if you will- the effort on both parties, by the way- takes more time, because we're starting out with needing to establish you very clearly that we are going to be able to prove that this particular medicine that we're talking about is equally good or better because, of course, nobody would want to make the trade off and have a medicine that is radically lower price but not as good. So that's really job one and that is a really strict threshold for every single one of our eurx medicines, and that's one of the reasons why we're pointing to these upcoming presentations at the ASCO and re meeting, because all of that additional clinical evidence is important to further establish thatthen, as we are talking about the core terms of how we working together at that memorandum of understanding stage.

Speaker 4: That is really where we're talking about. What is each party's commitment? And I want to stress something: there is the very important commercial component here, but many of our partners have so much more to offer to enable our business model. There are true participants here because they realize that, for instance, if they have clinical evidence or if there is claims data, that can be really valuable for us as we're developing our medicines, when we're thinking about what the right pricing approach is. Where they have the ability to participate, for instance, in our clinical trials, they have the ability to lower our cost of development which, of course, further enables us to lowering our prices. So I want to make sure that when we think about these two stages- the mo? U stage in the pre commercialization stage- that we understand that there is a lot that goes into that and it's not just: here's a price in exchange for rei.mbur, sement. And then, as you said, this is new and there is no template for it.

Speaker 4: So these take some time, but I would say, all in all, we are on a great pace and the pace has continued unabated in the way that we've seen it in 2021. Thank you ste, and.

Speaker 4: And then Eric, you ask the penetration question. I mean, of course that's ultimately the goal, and the goal here is to enable as broad a population as possible and so ultimately our goal. When we've quoted numbers like the 18 million number that's really important to us, I mean we are going ultimately after that entire market of insured lives in the OECD countries.

Speaker 12: A quick follow-up there to Chris's earlier question. Has there been any change in prioritanization of the commercial organization toward Europe relative to the U S?

Speaker 13: Yes I would say that the falling way, Eric of we feel that we are growing incredibly fast and when you are inside eqx it feels like you've stepped into a Rocket chip. We're still only 350 people. We need to grow and we definitely. I mean, we have a small teamma outside of the U's but we definitely need to grow that team to be able to support all of the conversations that all going. Eric, I think, just to add to that, we are planning on our first filing outside the U's this year, So you can assume that our first revenues will be outside the U's and it's important to understand it. Because of our radically lower price model, we expect a more narrow pricing corridors, So the prices between the U's and Europe won't be exactly the same, but they will be more narrow.

Speaker 6: So the opportunity for ex relative to another biotech is very significant outside the U sour. Next question comes from Chris shani. With Goldman Sachs, your line is open.

Speaker 14: Thank you very much and good morning jre your're operating as a C fo in an especially challenging environment right. Now macro uncertainty regulatory challenges that the company's trying to address and yet also in trying to take a long view you're also trying to figure out how to build your portfolio think. At the start of the year you talked about providing some guidance on how you're looking to really shepherd the company's current healthy balance sheet but with the name to addressing the but also finding the growth can you talk about that four million. What is embedded within that how much of that is tied perhaps to the trials that are really fon center for you how much is possibly your. Mark toward the longer term view on bso our Thank you for that excellent question. You're right is clearly a very challenging capital markets environment and which is why we feel so fortunate to have.

Speaker 6: Such a strong cash position on our balance sheet. We ended the quarter with $1.6 billion in cash and, again just to reiterate, we expect that cash runway to last through into 2025. But with respect to your specific question on our four million or less guidance for the year, first of all, we are more than a third into the year and we have a very good handle on all of our activities for our level of spend. So, with respect to the comparative trials that we expect to begin to initiate in the second half, that is already incorporated in that $4 million number. Second, on your question related to being D, this is clearly an important part of our model and you can be rest assured that we would only bring in and asse if we believe it would bring significant value toward our global buyres club and our shareholders, and we talked about what that criteria is. So yes, we are going to be very prudent with our spending.

Speaker 6: And and if we have to, we will make trade-offs. We are constantly evaluating our portfolio. Frankly, we dow this if we are in a great capital markets, because that's what a good CFO does, but the bottom line is that we have enough cash to lessus through 2025 to help build shape, grow our portfolio and still very judicious with our spend.

Speaker 14: And linked over to that quickly. On the side, they're thinking about doing the discovery work with some of your partners, the artificial intelligence framed companies such as XI antt recursion, ETC. A that you outlined, think one of the fundamental tenetants of their approach is to do things in a more efficient, cost effective sort of faster, cheaper way. Are you seeing that as an opportunity and any sense for when we might be able to get some of the indications of how progress is going specifically in that regard, both with assets and the efficiencies that you are aim for?

Speaker 13: Yes Chris, Thank you for the question. This is melany as, as you just said, and we agree with that, it is a truly capital-efficient way of identifying and actually atinga new molecule with a very clear profile where we can, where we have the expectation that it's going to perform equally good or better for a particular indication or set of indications, and so that you will be able to hear more about this over the next couple of years because, as you know, we just got started with those. So I would say, stay tuned on those and, on the clinical side will be able, on the clinical stage portfolio, we will be able to provide more, more insight and clarity on that.

Speaker 4: In one of our upcoming calls. We wanted to focus today on all ALT net and sugamalammap, given just how important those are and, of course, the questions that have come up previously around with. The path forward with is both the outside the U's and in the U's. Thanks, that makes Sen all lookafforward to ask.

Speaker 1: Thank you for no further questions. I'd like to turn the call back over to mely for the closer remarksthank you so much, out ofoperator. I would like to thank everybody for joining us today for our first quarterly earnings call, and I just wanted to reiterate we're really excited about the progress that we have continued to make. Our team is firing on all cylinders and on all of the aspects of our business, we've continued to make great progress despite the fact, as Chris rightly said, these are challenging times for any Bio armaour company, and so we feel that we are in an incredibly fortunate position and we will continued to focus on what'.s important, and we're looking forward to seeing you at the next call.