Q2 2022 Altimmune Inc Earnings Call

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[music].

Operator: Good day, ladies and gentlemen, and welcome to the Altimmune Inc Q2 Financial Results, Conference call.

Operator: Go ahead, please.

Okay.

Good day, ladies and gentlemen, and welcome to the Alpha.

Operator: At this time, all participants are in the listen-only mode.

Seamus Fernandez: Great.

Q2 financial results conference call.

Operator: Later, we will conduct a question and answer session, and instructions will follow at that time.

Time, all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time to ask a question. During the session you will need to press star one on your telephone.

Operator: To ask a question during the session, you will need to press star 1 1 on your telephone.

Operator: As a reminder, this call is being recorded.

Seamus Fernandez: Thanks, guys.

A reminder, this call is being reported.

Operator: I would now like to introduce your host for, today's conference call, Rich Eisenstedt, Chief Financial Officer of Altimmune.

Seamus Fernandez: So just two quick follow-ups.

Now like to introduce your host for today's conference call Rich Chief Financial Officer of Albanian Rich you may begin.

Operator: Rich, you may begin.

Rich Eisenstadt: Thank you, Carlo, and good morning, everyone.

Seamus Fernandez: The first question, there was a publication from Novo Nordisk highlighting a relatively, robust study of their own glucagon agonist in combination with, I believe, their GLP-1 semaglutide.

Thank you Carlos and good morning, everyone. Thank you for participating in <unk> second quarter 2022 financial results Conference call.

Rich Eisenstadt: Thank you for participating in Altimmune's, second quarter 2022 financial results conference call.

Seamus Fernandez: Just wondering if you guys could comment, whether it be on that study or at least on, the safety of pembidutide as it relates to heart rate elevations.

Rich Eisenstadt: Members of the Altimmune team joining me on the call today are Vivian Garg, our Chief Executive Officer, Scott Roberts, our Chief Scientific Officer, and Scott Harris, our Chief Medical Officer.

Seamus Fernandez: I think the triple G agonist that Eli Lilly in their early phase 1 data saw substantial, heart rate elevations that clearly would require some factors there, but it's also our understanding that that also tends to be associated with GLP-1.

Members of the Australian team joining me on the call today are Kevin Guard, our Chief Executive Officer, Scott Roberts, Our Chief Scientific Officer, and Scott Harris, Our Chief Medical Officer.

Rich Eisenstadt: Following the prepared, remarks, we will hold a question and answer session.

Following the prepared remarks, we will hold a question and answer session. A press release with our second quarter 2022 financial results was issued this morning and can be found on the Investor Relations section of the company's website.

Rich Eisenstadt: A press release with our second quarter 2022 financial results was issued this morning and can be found on the investor relations, section of the company's website.

Rich Eisenstadt: Before we begin, I'd like to remind everyone that remarks about future expectations, plans, and prospects constitute forward-looking statements for purposes of safe harbor provisions under the Private Securities Litigation Reform Act of 1995.

Seamus Fernandez: So are you guys seeing anything related to heart rate elevations outside of what we would, see normally with the GLP-1 in your datasets at all?

Seamus Fernandez: Just wanted to start there just because that has been a critique from Novo Nordisk, but, we're not sure if it applies here or perhaps it's even just purely molecule-specific.

Before we begin I'd like to remind everyone that remarks about future expectations plans and prospects constitute forward looking statements for purposes of Safe Harbor provisions under the private Securities Litigation Reform Act of 1995, Ottoman cautions that these forward looking statements are subject to risks and uncertainties that could cause.

Seamus Fernandez: And then the second question was just, you know, as we think about the possibility of, entering larger phase 3, it would seem to us the size of the overall obesity efforts likely would have you guys with strong interest from a potential partner, especially if you can achieve the profile that you're talking about.

Rich Eisenstadt: Altimune cautions that these forward-looking statements are subject to risks and, uncertainties that could cause actual results to differ materially from those indicated, including those related to the ongoing conflict in Ukraine, COVID-19, and the impact on our business operations, clinical trials, and results of operations.

Actual results could differ materially from those indicated including those related to the ongoing conflict in Ukraine, COVID-19, and the impact on our business operations clinical trials and results of operations.

Rich Eisenstadt: For discussion of some of the risks and factors that could affect the company's future results, please see the risk factors and other cautionary statements contained in the company's filings with the SEC.

For a discussion of some of the risks and factors that could affect the company's future results. Please see the risk factors and other cautionary statements contained in the company's filings with the SEC.

Rich Eisenstadt: I'd also direct you to read the forward-looking statements disclaimer in our press release issued this, morning and now available on our website.

I'd also direct you to read the forward looking statements disclaimer in our press release issued this morning, and now available on our website any statements made on this conference call speak only as of today's date Thursday August 11th 2022, and the company does not undertake any obligation to update any of these forward looking statements to reflect events or circumstances.

Rich Eisenstadt: Any statements made on this conference call speak only as of today's date, Thursday, August 11, 2022, and the company does not undertake any obligation to update any of these forward-looking statements to reflect events or circumstances that occur on or after today's date.

Rich Eisenstadt: As a reminder, this conference call is being recorded and will be available for audio replay on Altimmune's website.

That occur on or after today's date.

As a reminder, this conference call is being recorded and will be available for audio replay on <unk> website with that I will now turn the call over to Dr. Vipin Garg, Chief Executive Officer of Opryland.

Rich Eisenstadt: With that, I will now turn the call over to Dr. Vipin Garg, Chief Executive Officer of Altimmune.

Seamus Fernandez: How are you guys thinking about the timing of when you think it's best to engage with, potential partners from a strategic discussion perspective?

Vipin Garg: Thank you, Rich, and good morning, everyone.

Seamus Fernandez: Thanks.

Thank you rich and good morning, everyone.

Vipin Garg: We appreciate you joining us today for a discussion of our second quarter 2022 financial results and business update.

Scott Harris: Hey, thanks, Seamus.

We appreciate you joining us today for a discussion of our second quarter 2022 financial results and business update.

Vipin Garg: We continue to advance multiple clinical trials for our lead obesity product candidate, Pembidutide, a GLP-1 glucagon dual-receptor agonist, and are excited about reporting important data from these trials in the coming months.

Scott Harris: I'll answer the first question, and then I'll turn to Vipin to answer the second question.

Scott Harris: So, as you know, in that triple G study, the effects on heart rate were striking. They announced that with their multiple dosing, they saw increases of about 10 beats per minute. But actually, in their single ascending dose study earlier than that, they actually got 30 beats per minute.

We continue to advance multiple clinical trials for our lead obesity product candidate <unk> <unk>, one glucagon dual receptor agonist.

And are excited about reporting important data from these trials in the coming months.

Vipin Garg: One thing that has become abundantly clear over the last 12 months is that we now have two truly effective drugs to combat the obesity epidemic, and with promising additional drugs on the horizon.

Scott Harris: So why is that?

One thing that has become abundantly clear over the last 12 months is that we now have two truly effective drugs to combat the obesity epidemic.

Vipin Garg: Given the increasingly competitive obesity space, it's important to highlight the potential differentiating features of Pembidutide. First, we believe that we have the potential to achieve weight loss equal to or exceeding 20% after only 48 weeks of treatment, confirming the benefit of adding glucagon agonism to GLP-1 monotherapy. We also believe the robust reduction of serum lipids observed in our Phase I trial could translate into important cardiovascular benefits with long-term use, further increasing the value proposition of our drug candidate.

Scott Harris: Is that because you simply added glucagon to the molecule?

And with promising additional drugs on the horizon.

Given the increasingly competitive obesity space. It is important to highlight the potential differentiating features of <unk> died.

Scott Harris: Well, we'd say a couple of things about that.

Scott Harris: The first is the amount of glucagon in that triple G, as we understand it, and I want to emphasize that, is small.

First we believe that we have the potential to achieve weight loss equal to or exceeding 20%. After only 48 weeks of treatment.

Confirming the benefit of adding glucagon agonism to GOP one monotherapy.

We also believe the robust reduction of serum lipids observed in our phase one trial could translate into important cardiovascular benefits with long term use further increasing the value proposition of our drug candidate <unk>.

Vipin Garg: Finally, we believe that the absence of dose titration will be viewed as a major advantage in the minds of prescribers and patients, simplifying management by avoiding the cumbersome use of dose titration over the first four to five months of therapy.

Finally, we believe that the absence of dose titration will be viewed as a major advantage in the minds of prescribers and patients simplifying management by avoiding the cumbersome to use a dose titration over the first four to five months of therapy.

Vipin Garg: We are planning to announce the top-line data readout on our Phase Ib multi-center trial in subjects with obesity or overweight and non-alcoholic fatty liver disease, or NAFLD, in mid-September. The key readouts will include assessment of liver fat, weight loss, serum lipids, and safety at 12 weeks of treatment.

Scott Harris: That molecule appears to be terzepatide, slightly lower ratio of GIP to GLP-1.

We are planning to announce the topline data readout on our phase one b multicenter trial in subjects with obesity are overweight and non alcoholic fatty liver disease or <unk> in mid September .

Vipin Garg: Scott Harris will join us shortly to discuss our expectations for that readout.

The key Readouts will include assessment of liver fat weight loss serum lipids and safety at 12 weeks of treatment.

Scott Harris will join us shortly to discuss our expectations for that readout.

Vipin Garg: In addition, we are currently executing a 12-week double-blind placebo-controlled extension to this trial and expect data readout after 24 weeks of treatment in Q4 2022. We believe that the 24-week readout will provide valuable information about the weight loss that could be achieved with Pembidutide at one year of treatment.

In addition, we are currently executing a 12 week double blind placebo controlled extension to this trial and expect data readout. After 24 weeks of treatment in Q4 2022.

We believe that the 24 week readout will provide valuable information about the weight loss that could be achieved with them. We do died at one year of treatment.

Vipin Garg: Our 48-week Phase II momentum trial of Pembidutide in subjects with obesity and overweight is enrolling rapidly. Approximately 25 obesity study centers are now enrolling in the trial across the United States.

Our 48 week phase III momentum trial of <unk> died in subjects with obesity and overweight is enrolling rapidly.

Approximately 25 obesity study centers are now enrolling in the trial across the United States.

Vipin Garg: States.

As of yesterday August 10, we had randomized 167 subjects and.

Vipin Garg: As of yesterday, August 10, we had randomized 167 subjects and we expect to fully, enroll the 320-subject trial population by the end of this third quarter. A 24-week interim analysis, which was initially planned at year-end 2022, is now planned for Q1 2023, when we expect that approximately 50% of the subjects have been treated for 24 weeks. We believe the interim readout on 50% of the subjects in our trial would provide a more meaningful and robust data set in our evaluation of PEMBEDU type.

And we expect to fully enroll the 320 subject trial population by the end of the third quarter.

A 24 week interim analysis, which was initially planned at year end 2022.

Is now planned for Q1 2023.

Can we expect that approximately 50% of the subjects have been treated for 24 weeks.

We believe the interim readout on 50% of the subjects in our trial would provide a more meaningful and robust data set in our evaluation of <unk>.

Vipin Garg: Scott Harris will talk more about the momentum trial shortly.

Vipin Garg: A 12-week phase 1b multicenter trial in type 2 diabetics is also ongoing, and we expect this trial to provide important information on parameters of glucose control, such as hemoglobin A1c in subjects with obesity and overweight who have type 2 diabetes.

Scott Harris will talk more about the momentum trial shortly.

At 12 week Phase <unk> Multicenter trial in type two diabetics is also ongoing.

And we expect this trial to provide important information on parameters of glucose control such as hemoglobin <unk> C in subjects with obesity and overweight who have type two diabetes.

Vipin Garg: Finally, we are continuing to enroll in our phase 2 multicenter trial of hep T cell in subjects with inactive chronic hepatitis B, and expect to have a data readout in the second half of 2023.

Finally, we are continuing to enroll in our phase II multicenter trial of <unk> in subjects with inactive.

Sonic hepatitis B and expect to have a data readout in the second half of 2023.

Vipin Garg: We are excited about the progress of PEMBEDU type and hep T cell and the upcoming results of these ongoing trials.

Yeah.

Vipin Garg: With that, I'll now turn the call, over to our chief medical officer, Dr. Scott Harris, to discuss our data and clinical plans.

We are excited about the progress of <unk> tight and have T cell and the upcoming results of these ongoing trials.

With that I'll now turn the call over to our Chief Medical Officer, Dr. Scott Harris to discuss our data and clinical plans Scott. Thank you Vic and good morning, everyone.

Scott Harris: Scott?

Scott Harris: Thank you, Vipin, and good morning, everyone.

Scott Harris: I think in terzepatide, it's 15 to 1.

Scott Harris: First, let me talk about our upcoming readout, in our 12-week phase 1b multicenter trial of subjects with obesity or overweight and NAFLD in mid-September. NAFLD in this trial was defined as a 10% or greater liver fat, content as measured by MRI PDFF. At the conclusion of enrollment, the trial randomized and dosed 94 subjects who were randomized 1 to 1 to 1 to 1, to 1.2 milligrams, 1.8 milligrams, 2.4 milligrams PEMBEDU type, or placebo over 12 weeks of treatment.

Scott Harris: It looked like, based on the data they presented, that's 8 to 1.

First let me talk about our upcoming readout in our 12 week phase <unk> multicenter trial of subjects with obesity or overweight and novelty in mid September .

Scott Harris: But I want to emphasize that the ratio of GLP-1 to glucagon, that molecule, is 10 to 1.

<unk> D. In this trial was defined as a 10% or greater liver fat content as measured by MRI <unk>.

At the conclusion of enrollment the trial randomized and dose 94 subjects, who are randomized one to one to one to one to one two milligrams. One eight milligrams two four milligrams Panther do Todd or placebo over 12 weeks of treatment.

Scott Harris: Approximately 29% of the subjects participating in the trial have preexisting type 2 diabetes.

Approximately 29% of the subjects participating in the trial have preexisting type two diabetes.

Scott Harris: The primary endpoint of this trial is the reduction in liver fat by MRI PDFF, and a key secondary endpoint is weight loss at the end of 12 weeks of treatment.

The primary endpoint of this trial is the reduction in liver fat by MRI <unk> and a key secondary endpoint is weight loss at the end of 12 weeks of treatment.

Scott Harris: We will report consolidated and stratified data in these and other parameters for subjects with and without diabetes.

We will report consolidated and stratified data and these and other parameters for subjects with and without diabetes.

Scott Harris: The readout in September will also include the effects of PEMBEDU type on serum lipids, laboratory parameters including liver function tests and fasting glucose, adverse events, including adverse events leading to treatment discontinuation, hemoglobin A1c, heart rate, and blood pressure.

The readout in September will also include the effects of <unk> on serum lipids laboratory parameters, including liver function tests and fasting glucose advair.

Adverse events, including adverse events, leading to treatment discontinuation.

Hemoglobin, <unk> C heart rate and blood pressure.

Scott Harris: Based on an analysis of the pooled unblinded data, the average BMI of participants is approximately, 36, with median weight approximately of 101 kilograms, and the median age is approximately, 49 years, with approximately 50% of subjects, 53% of subjects being female.

Based on an analysis of the pooled unblinded data the average BMI of participants is approximately 36 with median weight approximately a 101 kilograms. In the median age is approximately 49 years with approximately 50% of subjects 53.

Scott Harris: As you are aware, we are conducting a 12-week extension trial for participants who complete, the initial 12 weeks of treatment, resulting in a total of 24 weeks of treatment. The extension trial is now fully enrolled, and we expect to read out on these results, in Q4 2022.

Percent of subjects being female.

As you are aware, we are conducting a 12 week extension trial for participants who complete the initial 12 weeks of treatment, resulting in a total of 24 weeks of treatment.

The extension trial is now fully enrolled and we expect to read out on these results in Q4 2022.

Scott Harris: The principal readouts will be weight loss and the continued safety of PEMVIDUTIDE administration. 24-week data may allow us to project the amount of weight loss that could be achieved by PEMVIDUTIDE, at one year of treatment.

Principal readouts will be weight loss and the continued safety of Panther do Todd administration.

The 24 week data in May allow us to project the amount of weight loss that could be achieved by Pampa do tied at one year of treatment now let me talk about the phase III momentum trial of <unk> in obesity.

Scott Harris: Now let me talk about the Phase II Momentum Trial of PEMVIDUTIDE in obesity. The trial is enrolling approximately 320 non-diabetic subjects with either obesity or overweight, with at least one obesity-related complication across approximately 25 obesity study centers in the United States. Subjects are being randomized one-to-one to one-to-one to receive either 1.2 milligrams, 1.8 milligrams, 2.4 milligrams PEMVIDUTIDE or placebo administered weekly for 48 weeks as an adjunct to diet and exercise.

Scott Harris: There's only one-tenth the relative amount of activity in that molecule compared to the GLP-1.

Scott Harris: So if there's any effect of that molecule, it's the GLP-1, and we've seen those heart rate increases before.

The trial is enrolling approximately 320, non diabetic subjects with easier obesity or overweight with at least one obesity related complication across approximately 25 obesity study centers in the United States.

Scott Harris: How do we explain it, and why aren't we seeing it with our compound?

Scott Harris: We believe it's probably the pharmacokinetic effect. If you look at the time to maximal concentration of that compound, as we understand it, as presented in graphs at the meeting, it looks like it's very short, about 12 hours.

Subjects are being randomized one to one to one to one to receive either one two milligrams or one eight milligrams two four milligrams Panther do tired or placebo administered weekly for 48 weeks as an object as an adjunct to diet and exercise the.

Scott Harris: And, again, I want to say it's about because I'm estimating it from slides that they presented without actually seeing the raw data. What that means is that when that drug is given, there's a surge of drugs into the bloodstream with higher peak concentrations and immediate effect.

Scott Harris: Contrast that with penzidutide, where we see a maximal concentration that's actually several times greater than that, not 12 hours but 70 hours, with a lower Cmax.

Scott Harris: We've estimated that our Cmax compared to comparative doses of semaglutide is about one-third. So what we have is an onset that is slower and perhaps more gentle.

Scott Harris: The primary endpoint of the Momentum Trial is the relative percent change in body weight, at 48 weeks compared to baseline with additional readouts including metabolic and lipid profiles, cardiovascular measures, and glucose homeostasis.

Scott Harris: Using a non-biological term, but we think that that accounts for the lack of heart rate increases.

The primary endpoint of the momentum trial is the relative percent change in body weight at 48 weeks compared to baseline with additional readouts, including metabolic and lipid profiles cardiovascular measures in glucose homeostasis.

Scott Harris: Now, we presented that data at the ADA meeting, that we're not seeing the heart rate increases of semaglutide.

Scott Harris: You know, it's probable that as we go further in development, because this is a GLP-1-based compound that we'll see some increase, the initial data suggests that it's not going to be significant any more than a GLP-1.

Scott Harris: Dr. Lou Arani from Weill Cornell Medical School, a leading authority in obesity in clinical, trials, is serving as the principal investigator.

Scott Harris: But again, I want to emphasize that we have a small number of patients, and we'll just observe that as we go.

Dr. Lu Irani from corn Wild Cornell Medical school, a leading authority in obesity in clinical trials is serving as the principal investigator.

Scott Harris: But we think that the heart rate increase that we're seeing with the glucagon-containing compound were not due to glucagon. We think it was the nature of the pharmacokinetics.

Scott Harris: As Vipin mentioned, enrollment and randomization are progressing rapidly.

Vipin Garg: So for the second question, I'm going to turn that over to Vipin.

As Vipin mentioned enrollment and randomization are progressing rapidly.

Scott Harris: We now plan to perform an inner analysis to assess changes in body weight after 24 weeks, of treatment on approximately 50 percent of expected study participants in Q1 of 2023.

We now plan to perform an interim analysis to assess changes in body weight. After 24 weeks of treatment on approximately 50% of expected study participants in Q1 of 2023.

Scott Harris: We are currently randomizing 25 subjects per week and expect to complete randomization, of the full 320 study participants next month.

We are currently randomized 25 subjects per week.

Expect to complete randomization of the full 302 study participants next month.

Scott Harris: We are also completing enrollment in our 12-week Phase 1 multicenter trial evaluating the effects, of PEMVIDUTIDE on glucose control in subjects with type 2 diabetes. Approximately 48 subjects are planned with readout expected in Q1 2023.

We are also completing enrollment in our 12 week phase one multicenter trial evaluating the effects of <unk> on glucose control in subjects with type two diabetes. Approximately 48 subjects are planned with readout expected in Q1 2023.

Scott Harris: Across the trials that I have described, we are rapidly building the safety profile of, PEMVIDUTIDE with unblinded safety data accrued in over 200 subjects receiving one or more doses of PEMVIDUTIDE in clinical trials expected by year end 2022 and approximately 500 subjects by year end 2023.

Vipin Garg: Yeah, Seamus, I mean, we agree with you that with this kind of data package that we are putting together, and if we are able to maintain the profile that we've been highlighting that we expect pemviglutide to have, we expect to have significant strategic interest in this program.

Across the trials that I have described we are rapidly building the safety profile of <unk> to do Todd with Unblinded safety data accrued and over 200 subjects, receiving one or more doses of Pampa <unk> and clinical trials expected by year end 2022, and approximately 500 subjects by year end 2002.

Vipin Garg: So we'll explore that.

Vipin Garg: Right now, we're focused on generating this data.

Scott Harris: We are all aware of the recent interim readout on the Wegovy-Select cardiovascular outcomes, trial, and like most of us who are following this study, we believe that a positive effect in cardiovascular outcomes will be demonstrated at the final readout.

Seamus Fernandez: We think that's what's going to drive the value proposition.

<unk> three.

We are all aware of the recent interim read interim readout on the <unk> select cardiovascular outcomes trial.

Seamus Fernandez: Thanks so much, guys.

Like most of US who are following this study we believe that a positive effect on cardiovascular outcomes will be demonstrated at the final readout.

Operator: And we have another follow-up question from Mayank Mamtani.

Scott Harris: Following on this thought, however, I'd like to highlight the robust reductions in serum, lipids demonstrated in our first in human clinical trial of PEMVIDUTIDE where we achieved, 20 to 30 percent. Reductions in Total and LDL Cholesterol Within 12 Weeks of Pemidutide Treatment.

Operator: Go ahead, please.

Following on this thought however.

Mayank Mamtani: Oh, thanks for taking my follow-up.

I'd like to highlight the robust reductions in serum lipids demonstrated in our first in human clinical trial of <unk>, where we achieved 20% to 30%.

Mayank Mamtani: And maybe just another kind of follow-up, a forward-looking kind of question.

<unk> in total and LDL cholesterol within 12 weeks of <unk> treatment.

Scott Harris: These lipid effects are expected to have important implications for cardiovascular disease, such, as myocardial infarction, stroke, and heart failure, and they compare quite favorably to the limited 3% reduction in total and LDL cholesterol, total cholesterol and LDL levels observed in the Wegovy Step 1 trial at 68 weeks.

Mayank Mamtani: Like in terms of doing a CV outcome trial, do you expect that to be in parallel to your, Phase 3 or more sequentially post-Phase 3?

Mayank Mamtani: And as you know, the reason I ask you this question is with the recent NOVO update, you, know, with the select study, but also, I mean, you're trying to get to, you know, weight loss levels comparable to triglycerides, you know, in two-thirds of the time.

These lipid effects are expected to have important implications for cardiovascular disease, such as myocardial infarction stroke and heart failure and they compare quite favorably to the limited 3% reduction in total and LDL cholesterol.

Total <unk> total cholesterol and LDL levels observed.

And that will go via step one trial at 68 weeks.

Scott Harris: We believe the marked effect on lipids that we demonstrated in our first in-human trial, speak directly to the superior effects of glucagon on hepatic and serum lipids and support our belief that we will achieve more rapid and pronounced outcomes when cardiovascular outcomes trials with Pemidutide are conducted.

We believe the market effect on lipids that we demonstrated in our first in human trial speak directly to the superior effects of glucagon on hepatic concern lipids and support our belief that we will achieve more rapid and pronounced outcomes when cardiovascular outcomes trials with Panther do Todd are conducted.

Scott Harris: We are also making continued progress in the enrollment of our Phase 2 multicenter, clinical trial of hep T cell in subjects with inactive chronic hepatitis B and expect the results of this trial in the second half of 2023.

We are also making continued progress in the enrollment of our phase II multicenter clinical trial of <unk> T cell in subjects with inactive chronic hepatitis B and expected results of this trial in the second half of 2023.

Scott Harris: Recall that the virologic effects of hep T cell are being evaluated in chronically infected, patients to enable the combination of hep T cell with novel direct-acting antivirals as part of combination therapy for chronic hepatitis B. I will now hand the call over to Rich Eisenstadt to give an update on our first quarter financial, results.

Recall that the virologic effects of Hep T cell are being evaluated in chronically infected patients to enable the combination of Hep T cell with novel direct acting anti Virals as part of combination therapy for chronic hepatitis b.

Mayank Mamtani: So I'm just curious, as you look forward, like, would doing an outcome study in parallel, to doing your Phase 3, because longer term, these are important to, you know, reimbursement and payer dynamics for the market?

I will now hand, the call over to rich and start to give an update on our first quarter financial results rich. Thank you Scott and good morning again everybody.

Rich Eisenstadt: Rich?

Rich Eisenstadt: Thank you, Scott.

Rich Eisenstadt: And good morning again, everybody.

Scott Harris: Yeah, Mayank, it's a great question.

Rich Eisenstadt: For today's call, I'll be providing a brief update on Altamine's second quarter 2022 financial, results.

Scott Harris: I want to emphasize that first, that the conduct of a cardiovascular outcome trials will not, be gating to approval that we do it in parallel with Phase 3 or afterwards.

Scott Harris: These drugs are approved without having these trials up front.

For today's call I'll be providing a brief update on <unk> second quarter 2022 financial results more comprehensive information will be available in our Form 10-Q to be filed with the SEC later today.

Scott Harris: So we saw that recently with Mongero, terzapatide.

Rich Eisenstadt: More comprehensive information will be available in our Form 10-Q to be filed with the SEC, later today. Altamine ended the second quarter of 2022 with approximately $184.8 million of cash, cash equivalents and short-term investments, compared to $190.3 million at the end of 2021. We drew down approximately $21.3 million in net proceeds off of our ATM during the three, months into June 30, 2022, and had approximately $32.9 million in availability remaining under the ATM at June 30.

Scott Harris: I think it's intriguing to think that we could do it in parallel.

<unk> ended the second quarter of 2022 US approximately 184 $8 million of cash cash equivalents and short term investments compared to $193 million at the end of 2021.

We drew down approximately $21 $3 million in net proceeds off of our ATM. During the three months ended June 32022, and had approximately $32 $9 million and about Val.

Remaining under the ATM at June 30th.

Rich Eisenstadt: Turning to the income statement, revenue was minimal in the second quarter of 2022, compared, to $100,000 in the same period in 2021. Our change in revenue for the quarter was primarily due to the discontinuation of development, activities for our T-COVID and nasal shield programs.

Turning to the income statement revenue was minimal in the second quarter of 2022 compared to $100000 in the same period in 2021, our change in revenue for the quarter was primarily due to the discontinuation of development activities for our T. Covid a nasal shale programs re.

Rich Eisenstadt: Research and development expenses were $16 million in the second quarter of 2022, compared, to $13.3 million in the same period in 2021. Approximately $10.1 million of this total for the second quarter of 2022 was direct, expenses for the conduct of our clinical programs, including $8.7 million in direct costs related to development activities for pemvidutide, and $1.4 million in direct costs related to development activities for hep T cells.

Search and development expenses were $16 million in the second quarter of 2022 compared to $13 $3 million in the same period in 2021.

Approximately $10 $1 million of this total for the second quarter of 2022 was direct expenses for the conduct of our clinical programs, including $8 $7 million in direct costs related to development activities for <unk> and one $4 million in direct costs related to development activities for Hep T cell.

Rich Eisenstadt: Approximately $1.9 million of expense in the second quarter of 2022 was a non-cash, expense associated with the achievement of the phase two development milestone for pemvidutide.

<unk>.

Approximately $1 $9 million of expense in the second quarter of 2022 was a noncash expense associated with the achievement of a phase III development milestone for <unk>.

Rich Eisenstadt: General and administrative expenses were $4.4 million in the second quarter of 2022, as compared, to $3.7 million in the same period in 2021. The increase year-over-year was primarily attributable to increased labor and labor-related, expenses, including stock compensation expense.

General and administrative expenses were $4 $4 million in the second quarter of 2022 as compared to $3 7 million in the same period in 2021.

The increase year over year was primarily attributable to increased labor and labor related expenses, including stock compensation expense.

Rich Eisenstadt: Net loss for the three months entered June 30, 2022, was $20.1 million, or $0.42 net, loss per share, compared to $24.8 million, or $0.60 net loss per share, for the second quarter of 2021. Our existing cash not only fully funds us through all of our ongoing clinical trials, but we currently estimate that our cash is sufficient to allow us to operate into the second half of 2024.

Net loss for the three months ended June 32022 was $20 $1 million or <unk> 42.

Net loss per share compared to $24 8 million or <unk> 60, <unk> net loss per share for the second quarter of 2021.

Our existing cash not only fully funds us through all of our ongoing clinical trials are currently estimate that our cash is sufficient to allow us to operate into the second half of 2024.

Rich Eisenstadt: I will now turn back over to Vipin for his closing remarks.

Scott Harris: It's not something that we've carefully looked at.

I will now turn back over to Vipin for his closing remarks.

Vipin Garg: Vipin?

Vipin Garg: Thank you, Rich.

Vipin Garg: Sir, that concludes our final remarks, formal remarks, and we would like to open the lines, to take questions.

Scott Harris: We think it's a very nice suggestion, and we'll certainly take a better look at it.

Thank you rich.

Operator that concludes our final remark formal remarks, and we would like to open the lines to take questions could you. Please instruct the audience on the Q&A procedure.

Operator: Could you please instruct the audience on the Q&A procedure?

Operator: Thank you.

Scott Harris: Thank you.

Operator: As a reminder, to ask a question, you will need to press star 1-1 on your telephone keypad.

Vipin Garg: Thank you, and now I would like to turn the conference back to Vipin for closing remarks.

Vipin Garg: Thank you, everyone, for participating today.

Thank you as a reminder to ask a question you will need to press star one on your telephone keypad.

Operator: Our first question is from the line of Ms. Fernandez of Guggenheim.

Vipin Garg: We appreciate this opportunity to share our results and outlook with you, and thank you, for your continued interest.

Question is from the line of.

Operator: Your question, please.

Vipin Garg: Have a nice day.

Fernandez Guggenheim.

Seamus Fernandez: Oh, great, guys.

Operator: This concludes today's conference call.

Operator: Can you hear me okay?

Operator: Thank you for participating.

Your question please.

Operator: Yes.

Oh, great guys can you hear me okay.

Operator: Okay.

Seamus Fernandez: Excellent.

Seamus Fernandez: So just a couple of things, you know, on timelines and expectations heading into the event, obviously, you guys are making some very strong statements around what you believe Pemba Dutide has the capability to do, and incorporating that 20% target into the press release, I'm sure, has people paying attention.

Yes.

Okay excellent so just a couple of things.

On on timelines.

And expectations heading into the event. Obviously you guys are making some very strong statements around what you believe.

<unk> has the capability to do in.

And incorporating that 20% target into the press release I'm sure.

Seamus Fernandez: Wanted to just get a little bit of incremental color on, you know, your conviction around, that 20% threshold.

Has people paying attention.

I wanted to just get a little bit of incremental color on.

Your conviction around.

Seamus Fernandez: It would strike us that, you know, even if you were to achieve a high teens number, you, know, at 48 weeks, that would still be approaching, if not, you know, still a best-in-class result relative to the current two assets.

Around that 20% threshold it would strike us that even if you were to achieve a high teens number.

At 48 weeks that would still be.

Approaching if not still a best in class result relative to the current two assets. So just wanted to get a better sense of what you guys. What raised your conviction to kind of.

Seamus Fernandez: So just wanted to get a better sense of what you guys, what raised your conviction to kind, of put that and, you know, really make such a strong statement.

Put that.

And.

Really make such a strong statement.

Seamus Fernandez: And again, you know, we can certainly see that, but I have to imagine, you know, that, perhaps you're seeing something in the phase one data to imply that things are going quite well.

And again.

We certainly see that but I have to imagine.

You know that that perhaps youre seeing something on in the phase one.

Data to imply that that things are going quite well.

Seamus Fernandez: Separately, as we just kind of look at the updates on the timing dynamics, you know, where we saw some push out, I guess, can you talk to us and help us understand what the workup of the patients actually is?

Separately.

As we just kind of look at the updates on the timing dynamics.

Where we saw some push out.

I guess you can you can you talk to us and help us understand what the work up of the patients actually is.

Seamus Fernandez: You know, we actually think it's good that there's a healthy pace, but perhaps not too, fast of a pace of patient enrollment.

We actually think it's good that there is a healthy pace, but perhaps not too fast of a pace.

Seamus Fernandez: And while folks may be a little bit disappointed by the timing of the 24-week results, I was, just hoping you could give us an update on the participation rate from patients going from the 12-week into the 24-week extension in the NAPLD study.

Of patient enrollment.

And while folks maybe a little bit disappointed by the timing.

Of the 24 week results I was just hoping you could give us an update on the the.

Patients right.

From patients going from the 12 week.

Seamus Fernandez: And then just the last question, you know, the diabetes, you know, study, can you just, remind us what you're hoping to understand in the phase one, you know, basically safety portion study in the diabetic patient population?

The 24 week extension in the Napoli study and then just the last question.

The diabetes.

Ah study can you just remind us what you're hoping to understand in the phase one.

Basically safety portion study and the diabetic patient population is that purely drug drug interaction work.

Seamus Fernandez: Is that, you know, purely drug-drug interaction work?

Seamus Fernandez: Or is it possible that we could see, you know, treatment-related effects in that patient, population just to kind of replicate the 29% of patients that are in NAPLD?

Or is it possible that we could see.

Treatment related.

And that patient population just to kind of replicate the 29% of patients that are in Nassau the apologize for the.

Seamus Fernandez: Apologize for the series of questions, but just wanted to get those three things out there.

Series of questions, but just wanted to get those those three things out there. Thanks.

Seamus Fernandez: Thanks.

Scott Harris: Yeah, absolutely.

Operator: You may now disconnect.

Scott Harris: Good morning, Seamus.

Operator: The conference will begin shortly.

To raise your hand during Q&A, you can dial star 1-1.

Scott Harris: All great questions.

Yes, absolutely good morning Seamus.

Scott Harris: There's a lot to unpack there.

Great question stays a lot to unpack there.

Scott Harris: So let me just start with, in terms of the magnitude of weight loss, as we have said, all along, and we agree with you that it's not about just achieving a number.

So let me just start with in terms of.

The magnitude of weight loss Seth as we have said all along and we agree with you that it's not about just achieving a number it's really looking at the entire package that you're bringing to the table and we've been emphasizing that it's not just the weight loss.

Scott Harris: It's really looking at the entire package that you're bringing to the table.

Scott Harris: And we've been emphasizing that it's not just the weight loss, it's lack of dose titration, it's our serum lipid profile that we are seeing.

Lack of dose titration is a serum lipid profile that we are seeing all of that will go into finally distinguishing differentiating and we do died from the rest of the field.

Scott Harris: So all of that will go into finally distinguishing or differentiating PEMV dutide from the rest, of the field.

Scott Harris: You know, based on what we have seen from our phase one study in Australia, as you know, we were able to achieve approaching 8% to 10% weight loss in about 12 weeks.

On what we have seen from our phase one study in Australia as you know we were able to achieve.

Approaching 8% to 10% weight loss in about 12 weeks feat when you compare that to other agents.

Scott Harris: When you compare that to other regions, it makes sense that we should be able to reach, a number approaching 20% in 48 weeks, because we got all of this runway left for the drug to work.

It makes sense that we should be able to reach a number approaching 20% and 48 weeks because we got all of this runway left.

Scott Harris: So that's really where that conviction is coming from.

For the drug to work, so thats really where that conviction is coming from we are totally on unblinded to the National day Phase one study. So none of this is coming from from that.

Scott Harris: We are totally unblinded to the NAFLD phase one study, so none of this is coming from, that.

Scott Harris: But we continue to believe that PEMV dutide has the potential to be a highly differentiated, product in this space.

But we continue to believe that <unk> has the potential.

To be highly differentiated our product in this in this space.

Scott Harris: Our second question relates to – Scott, do you want to take that?

Sure.

Your second question relates to Scott do you want to take that Yeah, Hey, Seamus good morning.

Scott Harris: Yeah.

Scott Harris: Hey, Sheamus.

Scott Harris: Good morning.

Scott Harris: So you had several parts to your question, and let me make sure I touch on all of them, and please interrupt me if I haven't.

So you had several parts of your question and let me make sure I touch on all of them and please.

Scott Harris: We're very confident about the rate of enrollment.

Interrupt me if I haven't.

Scott Harris: We have a really great clinical operations group.

We're very confident about the rate of enrollment we have a really great clinical operations group.

Scott Harris: We also have, even more important than that, some very, very experienced obesity study, centers.

We also have even more important than that some very very experienced obesity study centers that are being Dr. Many trials through the years more recently some of them participated in the step of this amount or the surpass trials, we have a lot of confidence in them and based on that.

Scott Harris: We've conducted many trials through the years. More recently, some of them participated in the STEP, or their SURMOUNT, or their SURPASS, trials.

Scott Harris: We have a lot of confidence in them, and based on that, we are, you know, really confident, about the quality of the data that we're generating in that trial at a very nice rate.

We are.

We are.

Really confident about the.

The quality of the data that we're generating in that trial at a very at a very nice rate.

Scott Harris: We haven't commented yet on the rollovers from the NAFLD 12-week study to the 12-week, extension.

We haven't.

Commented yet on the rollovers from the one from the naphtha <unk> 12 week study to the 12 week extension, we will make that announcement.

Scott Harris: We'll make that announcement in the fourth quarter, but, you know, we're very happy, at this point at the rate of rollover.

In the fourth quarter, but we're very happy at this point at the rate of a rollover and finally regarding your question.

Scott Harris: And finally, regarding your question of the diabetes study, recognize that there are only, a limited number of subjects who are diabetic who are participating in the 12-week NAFLD study.

Of.

The diabetes study recognize that there are only a limited number of subjects, who are diabetic who are participating in the 12 week Napa <unk> study.

Scott Harris: Doing a committed diabetes study allows us to increase those numbers, get more robust, readouts, and also put some measures into that study that are considered to be more of an industry standard in assessing diabetic patients, such as continuous glucose monitoring that would be too difficult to incorporate into a NAFLD trial.

We are committed diabetes studies allows us to increase those numbers get more robust readouts and also put some measures into that study that are considered to be more of an industry standard and assessing diabetic patients such as continuous glucose monitoring that would be too difficult to incorporate into our now for <unk>.

Scott Harris: I wanted to also just clarify on a statement that Vipin made, that Vipin may have used, the word that we are unblinded.

Trial.

<unk>.

I wanted to also just clarify on the statement that <unk> made that.

Scott Harris: I want to make it clear that we are still blinded to the 12-week NAFLD data.

Vipin may have used the word that were unblinded I want to make it clear that we're still blinded to the 12 week Naphthyl D data. So let me just make sure that clarification Richard Thanks.

Scott Harris: So let me just make sure that clarification is heard.

Scott Harris: Great, thanks guys.

Seamus Fernandez: Really appreciate that.

Seamus Fernandez: And just on the diabetes study, can you guys clarify, did you increase the number of patients, that are going to be participating in that diabetes study?

Great. Thanks, guys really appreciate that and just on the diabetes study can you guys clarify did you increase the number of patients that are going to be participating in that.

Seamus Fernandez: And that's the reason that we're going to see those data in the first quarter of next, year.

Diabetes study and that's the reason that we're going to see those data.

Scott Harris: And the reason is to ensure that you have more robust data or just has enrollment been, a little bit more challenging in that study, and maybe you could just help us understand why that might be.

In the first quarter of next year and the reason is to ensure that you have more robust data or just has enrollment been a little bit more challenging in that study and maybe you could just help us understand why that might be.

Scott Harris: And then I'll drop back into the queue.

Scott Harris: Yeah, I don't want to talk about our final enrollments.

And then I'll drop back into the queue.

Scott Harris: Seamus, let me just say it's a combination of factors.

Yes, I don't want to talk about our final enrollments Seamus let me just say, it's a combination of factors, where we felt that we were much more comfortable announcing in the first quarter rather than the fourth quarter.

Scott Harris: We felt that we were much more comfortable announcing the first quarter rather than the, fourth quarter.

Scott Harris: Okay.

Scott Harris: Got it.

Seamus Fernandez: Thank you.

Operator: Our next question is from the line of Yasmin Rahimi from Piper Sandler.

Okay got it.

Thank you. Our next question is from the line of <unk> Rahimi from Piper Sandler go ahead. Your question. Please.

Operator: Go ahead.

Operator: Your question, please.

Yasmeen Rahimi: Good morning, team.

Yasmeen Rahimi: And thank you so much for taking my questions.

Good morning, Tim and thank you so much for taking my questions and thank you for it quite additional color presented in the press release. This morning, <unk> Parikh remarks few questions I'm going to go one by one the first question I would like to understand is I know in the past you guys have said that in the now called steady.

Yasmeen Rahimi: And thank you for the quite additional color presented in the press release this morning, and your remarks.

Yasmeen Rahimi: A few questions.

Yasmeen Rahimi: I'm going to go one by one.

Yasmeen Rahimi: The first question I would like to understand is, I know in the past you guys have said, that in the NAPLD study, the target diabetic population was 50%, and now we're at about, 29%.

Target diabetic population was 50%.

Yasmeen Rahimi: So, obviously, with less number of insulin-resistant patients in the study, it's going to influence, the mean weight loss.

Now we are at about 29%, so obviously with less number of insulin resistant patients in the study it is going to influence the mean weight loss. So just kind of provide some commentary on what your expectations are in the diabetic and non diabetic population in the snap hold steady.

Yasmeen Rahimi: So, just kind of provide us some commentary on what your expectations are in the diabetic, and non-diabetic population in this NAPLD study at a week, 12-week endpoint, so we could address that first.

And a week 12, 12 12 week endpoint.

Yasmeen Rahimi: And I have a couple little follow-ups as well.

We can address that first and then I had a couple of little follow ups as well.

Scott Harris: Sure.

Scott Harris: Very happy to address that, Yasmin.

Scott Harris: If you look at the NAPLD population in general, there are some studies out there that capture, this.

We're very happy to address that yes.

If you look at the natural depopulation in general there are some studies out there.

Scott Harris: The rate of diabetics in the NAPLD population is approximately 25%. It gets higher in the actual NASH population, but remember, this was a NAPLD population, with some NASH patients and not a committed NASH trial.

To capture this the rate of diabetics in the naphtha <unk> population is approximately 25% you.

It gets higher in the actual Nash population, but remember this was a naphtha D population with some nash patients and not a committed Nash trial.

Scott Harris: When we saw our initial enrollment, it did look like 50% of subjects who were coming, into the trial were diabetics, and that's what we had informed investors about. But actually, we came down to the expected number around 25%, and in fact, we're 29%.

When we saw our initial enrollment it did look like 50% of subjects, who are coming into the trial were diabetics at NASA, we had informed investors about but actually we came down to the expected number around 25% and in fact were 29%.

Scott Harris: So we think that we're right in line with where we should be. Although the initial estimates were higher, we are where we should have landed.

So we think that we're right in line with where we should be although the initial estimates were higher we are where we should have landed.

Scott Harris: Regarding the mean weight loss, I would direct you to focus on the fact that we are reporting, out the weight losses in the diabetics and non-diabetics separately, as well as the consolidated figure.

Regarding the mean weight loss I would.

Direct you to focus on the fact that we are reporting out the weight losses in the diabetic and non diabetic separately.

Scott Harris: I think that's the best way to understand the data, because they're separate populations.

As well as the consolidated figure I think thats, the best way to to understand the data because they are separate populations. So.

Scott Harris: So as I mentioned in my remarks, we'll report the weight loss and other data in three subsets, of patients.

As I mentioned in my remarks, we'll report the weight loss and other data.

Scott Harris: Patients, or sets of patients.

And three subsets of patients.

Scott Harris: First will be those who don't have diabetes, which would be a standard readout.

Or sets of patients first will be those who don't have diabetes, which would be a standard readout. The second would be those in diabetes and then finally, we'll consolidate but will allow everyone to see exactly what the separate effects are of <unk> and non diabetics in diabetics. Despite the ratios.

Scott Harris: The second would be those in diabetes, and then finally we'll consolidate, but we'll, allow everyone to see exactly what the separate effects are of PEMDU tied to non-diabetics and diabetics, despite the ratios.

Scott Harris: Thank you, Scott.

Yasmeen Rahimi: And then just, you know, with various analysts maybe having different views on what's the, expected bar in this upcoming, you know, 12-week time point for NAFLD, just, you know, can you help us understand what is an acceptable range in weight loss in your view that you think, you know, you hope to achieve if you could?

Thank you Scott and then just.

Various analyst maybe having different view.

What's the expected bar in this upcoming 12 week time point for now called Gist.

Can you can you help us understand what is an acceptable range and weight loss and your view that you think you.

Yasmeen Rahimi: And I'm sorry that I keep asking this, but we get this question quite a bit from our, investors as we head into middle of September data.

You hope to achieve if you could and im sorry that I keep asking that but we get this question quite a bit from here.

Yasmeen Rahimi: So just to add some color on what you're expecting in terms of an acceptable weight, loss range.

As we head into the middle of September data so congrats.

Give us some color on what you're expecting in terms of an acceptable way weight loss range.

Scott Harris: Yeah.

Scott Harris: I think that a nice starting point is to look at the terzepatide or the semaglutide data, at 12 weeks, Yasmin, and realize that those were obesity trials conducted over a baseline of diet and exercise intervention.

Yes, I think that a nice starting point is to look at the tours appetite at the <unk> data at 12 weeks Yasmin.

And realize that those were obesity trials conducted over a baseline of diet and exercise intervention. So that automatically gives you about two 2% to work with even without drug effects. So when you look at the placebo adjusted <unk> rate, it's 4%. If you look at the tourists appetite right for you.

Scott Harris: So that automatically gives you about 2% to work with, even without drug effects.

Scott Harris: So when you look at the placebo-adjusted semaglutide rate, it's 4%.

Scott Harris: If you look at the terzepatide rate, the placebo-adjusted is 6%.

Scott Harris: You know, clearly, to be interesting, I think we should be in that range, although we think, that we have properties, as Vipin emphasized, with glucagon that even if we're kind of somewhere in that range and not exceeding it, I guess that's not our expectation.

Placebo adjusted of 6% clear.

Clearly to be interesting I think we should be in that range. Although we think that we have properties as vipin emphasize.

With our glucagon that even if we are kind of somewhere in that range and not exceeding it against that thought our expectation but.

Scott Harris: But, you know, even if we're just in that ballpark, given the other superior properties, of pembidutide, the amazing lipid effects that we're seeing, and also the absence of dose titration, you know, we think that we're extremely competitive.

Even even if we're just in that ballpark given the other superior properties of <unk>. The amazing lipid effects that we're seeing and also the absence of dose titration, we think that we're extremely competitive.

Scott Harris: We really are looking towards the safety of the compound in this readout. We think that that's as important as anything else to move forward.

We really are looking towards the safety of the compound in this readout, we think that thats as important as anything else to move forward and then as you know.

Scott Harris: And then as you know, investors are looking at 12% because they're interested in what's, going to happen at 48 weeks.

<unk> are looking at 12% because they are interested in what's going to happen at 48 weeks.

Scott Harris: And I think that that's really what we're trying to really understand what's going to, happen at that point.

<unk>.

I think that Thats really what we are trying to really understand what's going to happen at that point certainly the 24 week data that we're going to generate in the fourth quarter with the extension of this trial is going to be extremely informative and.

Scott Harris: Certainly, the 24-week data that we're going to generate in the fourth quarter with the, extension of this trial is going to be extremely informative, and certainly as interesting is not more interesting than the 12-week readout.

Certainly as interesting as not more interesting than the 12 week read out.

Scott Harris: Thank you, Scott.

Yasmeen Rahimi: And then the last question.

Thank you Scott and then last question.

Yasmeen Rahimi: Can you maybe help us understand what type of safety data you are previewed to on a blinded, basis?

Can you maybe help us understand what hype.

The data you are privy to on a blinded basis as you know the safety data set is going to be critically important as we head into the September readout just in broad strokes. What are the type of things that you see on a blinded basis and if you could provide some commentary how satisfied you are with those with the things youre seeing would be great and thanks.

Yasmeen Rahimi: As you know, the safety data set is going to be critically important as we head into, the September readout.

Yasmeen Rahimi: Just in broad strokes, what are the type of things that you see on a blinded basis?

Yasmeen Rahimi: And if you could provide some commentary, how satisfied you are with the things you're, seeing would be great.

Scott Harris: And thank you, and I'll jump back into the queue.

Scott Harris: Yeah, thanks, Yasmin.

I'll jump back into the queue.

Scott Harris: It's well known that as a sponsor, being responsible for the safety of study subjects, we're always, alerted to panic values. That would be ALT elevations, glucose elevations, safety, severe adverse events, serious adverse, events, and the like.

Yes, thanks, Jasmine, well, it's well known that.

As a sponsor.

Being responsible for the safety of study subjects were always alerted to panic values.

That would be <unk> elevations.

Glucose elevations safety severe adverse events serious adverse events and the like.

Scott Harris: We don't see the aggregate data, by treatment group at least, until the end of the study, the same time you do.

We don't see the aggregate data.

By treatment group at least.

Until the end of the study at the same time, you do but you know based on what we're getting the information that we're getting in the trial on those metrics. We've just been very very happy so far.

Scott Harris: But you know, based on what we're getting, the information that we're getting in the, trial on those metrics, we've just been very, very happy so far.

Scott Harris: So I would say that, you know, based on that blinded understanding of the data, we're just, extremely encouraged.

So I.

I would say that.

Based on that blinded understanding of the data we're just extremely encouraged.

Yasmeen Rahimi: Excellent, thank you.

At this time thank you.

Yasmeen Rahimi: Thank you.

Okay.

Operator: Our next question is from the line of Roger Song of Jeffries.

Thank you. Our next question is from the line of Roger style of Jefferies Go ahead. Please.

Operator: Go ahead, please.

Roger Song: Great.

Roger Song: Thank you for taking the question.

Roger Song: A couple of questions on that.

Great. Thank you for taking the question a couple of a couple of questions on that so the first one maybe just a bit more.

Roger Song: So, the first one, maybe just be a little bit more specific.

Roger Song: Given you will have your phase 2 obesity study readouts after the phase 1 NAFLD, even the, 24-week data, so maybe just, Scott, you can just contextualize this for us and the investors.

Specific given you will have your phase <unk>.

The study Readouts.

The phase one.

<unk> D. Even the 24 week data so maybe just yet.

You can disconnect.

Roger Song: How shall we make read-through from one to the other from NAFLD study to obesity given, it's a slightly different population, baseline characteristics, et cetera?

<unk> characterize that for us and investors how should we make reserve from one to the other from Napa <unk> given it.

Slightly different population baseline characteristics et cetera. Thank you.

Roger Song: Thank you.

Scott Harris: Yeah.

Scott Harris: So, you know, clearly, as you get to 24 weeks with the NAFLD, you get an obesity readout.

Yes.

So clearly as you get to 24 weeks with an Apple D.

You get an obesity readout.

Scott Harris: We're going to have to look at that population at 12 and 24 weeks to see if there's any impact, on preexisting liver fat, on the weight loss.

We're going to have to look.

At that population at 12, and 24 weeks to see if there's any impact on pre existing liver fat on the weight loss.

Scott Harris: It's not something that's been well characterized in the literature.

Scott Harris: Our initial impression is that there shouldn't be an effect, but we're just going to have, to look at the data.

Its not something thats been well characterized in the literature. Our initial impression is that there shouldn't be an effect, but we're just going to have to look at the data.

Scott Harris: And there are differences in trial design, obviously.

And there are there are differences in trial design, obviously, you've already emphasized that point, but I want to reemphasize that the lack of diet and exercise from one study to the other that that also has to be taken into account, but we will be able to sort through all of that once we have the data I mean, there is no question that there will be some read through from one.

Scott Harris: You've already emphasized that point, but I want to reemphasize that the lack of diet, and exercise from one study to the other, that also has to be taken into account.

Scott Harris: But we'll be able to sort through all of that once we have the data.

Scott Harris: I mean, there's no question that there will be some read-through from one study to the, other because these patients are also obese patients, so we're expecting to see significant weight loss in them, both at 12 weeks and 24 weeks.

Study to the other because these are these patients are also obese patients. So we are expecting to see significant weight loss in them. Both at 12 weeks and 24 weeks.

Roger Song: Great.

Roger Song: Okay, great.

Roger Song: Great.

Roger Song: And then, so for the understanding the primary endpoint, efficacy endpoint is the liver fat, reduction.

Great Okay great.

And again, so for lack of understanding the primary endpoint efficacy endpoint is to demonstrate a reduction.

Roger Song: Can you just provide some color around the expectation for the liver fat reduction, given, your phase 1a have like a 90% plus liver fat reduction even at the six-week time point?

Can you just provide some color around the expectation for the liver fat reduction given your phase III.

Like a 90% plus.

That reduction at the <unk>.

Roger Song: Thank you.

Scott Harris: Yeah.

Six week time point, thank you.

Scott Harris: So, we were really impressed.

Yes.

Scott Harris: Even though the numbers were small, Roger, in that phase 1 first human trial, the effects, were so consistent it gave us a great deal of confidence in the readout.

So we were really impressed even though the numbers were small Roger in that phase one first in human trial. The effects are so consistent it gave us a great deal of confidence in the readout.

Scott Harris: I think, once again, the more liver fat reduction that you get, the greater the effects that, we're going to see on NASH resolution and fibrosis improvement, especially the speed with which we're seeing it because, as you recall, with the semaglutide trial, which did not have a significant effect on fibrosis improvement in their 72-week trial, the amount of liver fat they moved was very small, only about 34% at 24 weeks.

Once again.

The more liver fat reduction that you get the <unk>.

Later the effects.

See on Nash resolution and fibrosis improvement, especially.

Especially the speed with which were.

Seeing it because as you recall with the <unk> trial, which did not have.

A significant effect on fibrosis improvement in their 72 week.

Trial.

The amount of liver fat. They moved was very small only about 34% at 24 weeks.

Scott Harris: And although they hit 50% at the end of the year, the speed was not enough to see within, that same time period of one year a movement in fibrosis.

Though they had 50% at the end of the year. The speed was not enough to see within that same time period of one year movement in fibrosis.

Scott Harris: We're seeing very robust effects in only six weeks.

We're seeing very robust effects in only six weeks.

Scott Harris: Diagnostics.

If you.

If you place it against other drugs in the class.

Scott Harris: If you place it against other drugs in the class, we saw the FXRs coming, in in that 40 percent range.

We saw the <unk> coming in in that 40% range, we saw magical the resume turan thyroid agonist coming in at about 50%, we're seeing the FGF 20 ones coming in about 60% to 70%, we'd like to believe that we're going to be as good if not better.

Scott Harris: We saw Madrigal, the resmitoron thyroid agonist, coming in at about 50 percent.

Scott Harris: We're seeing the FGF21s coming in at about 60 to 70 percent.

Scott Harris: We like to believe that we're going to be as good, if not better, than those drugs.

Roger Song: Excellent.

Then those drugs.

Excellent. Thank you.

Yes.

Thank you.

Yes.

Roger Song: Thank you.

Thank you. Our next question is from the line of <unk> <unk> of B. Riley go ahead. Please.

Roger Song: Yeah, that's it on us.

Good morning team thanks for taking our questions. So it was just a good.

Roger Song: Thank you.

Follow up on the Napoli study.

Total enrollment it looks higher than I think what you need Glenn.

Can you just maybe comment why is that and then the baseline.

I think you commented on BMI age.

The proportion of female male but if you are able to give any color on baseline liver enzyme levels like.

We see.

Indianapolis settings, we've seen anything ranging from mid <unk> to mid <unk> mid <unk> and anything you could comment on that would be great and then avocado.

Yes.

So Mike we.

We obviously see the 94 subjects as being a real plus.

No.

<unk>.

Sure.

The patient has to go into the 12 week trial.

The same patients that go into the 24 week trial in other words to go into the extension.

And you have to understand that when patients came into that.

12, first 12 week trial, they came with the understanding that theyre going to come in for 12 weeks. They are offered another 24 weeks, but a lot of people didn't have the time.

Or set aside the commitment to go into for a full 24 weeks. So that has to be understood. Nonetheless were happy with the rollover rate, but the 94 patients really allowed us to move a robust number of patients from the 12 week study. The 24 weeks. So we see that as being a real positive on the readout.

We're going to have at 24 weeks and the extension trial.

So with regards to the liver enzymes.

We'll have that data this is not a nash trial. So the level of liver enzyme elevations are not going to be great, but we are allowing for some liver function elevations at baseline and we should be able to see a meaningful change.

In.

<unk> for example over the course of treatment of 12 weeks.

Thank you and then having that less proportion of diabetics in the Napoli study just curious.

What does that mean.

The weight loss.

<unk>.

I think it will be helpful to put in context what.

<unk> signed the Sam database studies dive duty.

Diabetes versus non diabetes patients that maybe from your earlier phase one study if you had any diabetes versus non diabetes patients.

Yes, so I'll take the second part of the question first our first study was conducted entirely with non diabetics. So we can't really use any information from that study to predict what we would see in type two diabetics in the upcoming trial readout.

I would emphasize however that 40% of the subjects who participated in the phase one study where pre diabetics and we saw a reduction.

In insulin resistance in that population and we saw.

The majority of those patients who are pre diabetics, becoming non non pre diabetic <unk>.

Regarding the lower percentage of patients who have type two diabetes in this trial I would emphasize again, the fact that we're going to read out separately and the three populations. The first being the non diabetics. So that will compare directly to step one which is this magnetite first pivot.

<unk>.

The second would be in diabetics that would compare to step two and then a combination although I don't think that the combination is meaningful and that's why the change in the percentage of diabetics is really not meaningful as well because what we're interested in is the separate effects of a non diabetics in diabetics with with Youre correct.

Understanding that typically in clinical trials diabetics lose less weight than non diabetics.

Got it and final question on the 48 week.

Full readout timeline this triangle understand that gap between when you have the 24 week in denim analysis in first quarter and that 48 week full analysis.

<unk> is going to be at the total sample size of 320 subjects.

Good units provide what that gap could look like in terms of timelines and just.

Maybe some color on what the screen failure rate.

I think it gave.

It's cleaning them by week of about 25 subjects.

Curious if you could comment on how that rate is increasing.

Bundle or months and what's the failure rate look legs.

Yes, so to be clear.

About 25 subjects per week is not our screening rate, that's an actual randomization and dosing rate.

Okay. There are subjects, who are actually being dosed and put into the final dataset. So based on that we will all have dosed our final patient by the end of September the screening rate is obviously higher than that we haven't gone public and what the screen failure rate is but we're very very happy.

With that but it's obviously a lot higher or somewhat higher than that.

Five subjects because of the screen failures.

<unk>.

We are confident obviously about the we'd added 24 weeks in the first quarter and.

With the completion of the first <unk>.

<unk> received their first dose.

Bye.

The end of September you can estimate where the 48, we'd act would approximately occur in 2023.

Operator: Thank you.

Got it I'll hop back in the queue. Thanks for taking our questions.

Got it.

Okay.

Thank you next question is from the line of John <unk> of JMP Securities Go ahead. Please.

Operator: Our next question is from the line of Mayank Mamtani of B. Riley.

Hey, good morning, and thanks for taking the questions.

Mayank Mamtani: Go ahead, please.

On the Napoli study.

Was hoping you could clarify I might've missed this if diet and exercise instruction as part of this phase one study.

Mayank Mamtani: Good morning, team.

That wasn't part of your prior phase one.

And then you mentioned the average.

Baseline weight is about 101 kilograms, which is substantially higher than you saw in phase one I'm wondering how you're thinking about.

How that might affect the weight loss you see here versus the prior study and Scott you said the study was fully enrolled but just looking for clarity on what percentage of patients rolled over into that 12 week extension. Thanks.

Thanks, Jonathan.

So you are absolutely correct.

We did not use diet and exercise.

And our initial first in human study and we are not using diet and exercise.

And the current 12 week naphtha <unk> study so consequently.

When we look at this we're not going to see the 2% benefit of placebo because remember.

That's a step in the surmount in even the surpass trials were conducted over a baseline of diet and exercise and the reason is is because when a drug is approved for the treatment of obesity in the U S. It's approved as an adjunct to diet and exercise so it actually has to be.

In this study the.

The <unk> study was designed without diet and exercise the same.

As the initial phase one study however.

The momentum phase III trial, which is committed obesity study.

<unk> FDA guidance is designed exactly like step one and surmount, one and with that we do have an intensive diet and exercise program.

With regards to the higher weight.

The mean weights or median wages I should say that we saw in the phase one study, where approximately 90% to 95 kilograms, depending on the cohort. So this is somewhat higher but it's not a lot higher our initial evaluations from our phase. One study suggested that we did not see an effect.

Body weight on either our serum concentrations or the amount of weight that people lost.

I'd also caution that that was a small number of subjects and we'll have to we'll have to see if that holds true as we go into this readout with a larger number of subjects.

The.

The extension study is fully enrolled we're happy with the rollover rate, we're happy with the additional patients who've gone into the study based following the increase of the size of the base study to 94, we Havent gone public.

On the percentage of rollover will obviously have data when we announced the 24 weeks, but it will be a very nice dataset.

Got it thanks again for taking the questions.

Mayank Mamtani: Thanks for taking our question.

Thank you. Our next question is from the line of Patrick Tokyo of H C. Wainwright go ahead. Please.

Mayank Mamtani: So, first, just a quick follow-up, on the NAFLD study.

Mayank Mamtani: The total enrollment looks higher than I think what you had originally planned.

Thanks, Good morning, I'm wondering and discussing the potential points of differentiation of <unk>. Todd. If you can talk about the expected advantages specifically in type two diabetic patients, particularly.

Mayank Mamtani: Can you just maybe comment why is that?

Particularly in the areas of glucose control and lipid counts relative to other mechanisms in the field and if you could also remind us the proportion of patients with obesity that would also be expected to present with type two in a real world setting.

Mayank Mamtani: And then the baseline, I think you commented on BMI, age, you know, proportion of female, male.

Thanks, Patrick So regarding your first question.

Mayank Mamtani: But if you are able to, you know, give any color, on baseline liver enzymes levels, like, you know, should we see, with these NAFLD studies, we've seen anything ranging from mid-30s to mid-50s to mid-70s IU per liter.

In type two diabetes.

Mayank Mamtani: So, anything you could comment on that would be great.

The immediate and I want to stress the word immediate targeted product profile for <unk>.

Mayank Mamtani: And then I have a follow-up.

It's not to have at least if I could.

<unk> monotherapy acute glucose lowering effects.

Scott Harris: Yeah.

We have balance in the compound <unk>.

Between <unk>, one and glucagon and we believe that that at the base case is going to be maintaining glucose and we saw that in our phase one study where glucose and hemoglobin <unk> C were maintained.

Scott Harris: So, Mayank, we obviously see the 94 subjects as being a real plus.

So but over the course of time recognize these patients lose weight.

And it was stressed at the recent <unk> meeting the focus in the treatment of patients with type two diabetes.

Should focus.

Not so much of the focus should change from the treatment or the control of blood sugar to the to the loss of body weight because the loss of body weight has a much more meaningful effect on their hemoglobin <unk> C. Over the course of time than the anti diabetic effects. So consequently were very confident given the amount of weight loss that were.

Seeing that we're going to achieve drops in hemoglobin <unk> C. Over the course of more extended treatment. We're fairly confident we will see that at 48 weeks, we're hoping we're going to see it at 24 weeks, but it's.

It's a shorter period of time with less weight loss, we may see it a 12 weeks that would certainly be only a plus that we saw a drop but at the same time our base cases.

We want to see.

Necessarily see a drop now recognize that one of the principal factors.

In blood sugar Ella's.

Elevations in type two diabetics as insulin resistance and the great great portion of that comes from the liver and its related directly to liver fat and when you see liver fat being decreased as dramatically as we are with <unk> and thats due to the glucagon effects. We think are going to see a drop in <unk>.

<unk> resistance, that's also going to contribute to the blood sugar decreases over time. So just to reiterate we do feel confident that this is an anti diabetic drug over say 48 weeks, perhaps 24.

Our base case at week 12 is that we won't see it but because of the hemoglobin <unk> C averages out the blood sugar for 12 weeks, even when you don't initially have weight loss.

But an upside would be that we saw a drop in hemoglobin on one senior fasting blood sugar in the diabetic population.

Regarding the lipids in diabetics it should be clear.

That diabetics do suffer from the effects of blood sugar in those.

Elevations result in micro angiopathy, such as diabetic eye disease, diabetic kidney disease, but the predominant reason for deaths in type two diabetics is serum lipids.

And consequently drugs it more effectively move serum lipids are going to have better cardiovascular outcomes that those that Don and I want to again contrast, the reductions in serum lipids that we saw particularly total LDL cholesterol and our phase one study of 20, 30% and contrast that to the only.

3% reductions in total and LDL cholesterol and the step one clinical trial and we think that ultimately that's going to have.

Major benefits on cardiovascular outcomes, when we conduct those clinical trials.

Regarding the your question Patrick about the percentage of obese patients who have type two diabetes, it's about 20%.

Got it that's really helpful and then.

Scott Harris: You know, the, patients who go into the 12-week trial are the same patients who go into the 24-week trial. In other words, who go into the extension.

Scott Harris: And you have to understand that when patients came into, that first 12-week trial, they came with the understanding that they were going to come in for 12 weeks.

Just another follow up question when you look to the first quarter of next year.

The interim data from momentum you'll also have the phase one b Applebee's studied 12 week and 24 week data as well as the phase one.

Study data in diabetic subjects. So additional safety data I'm. Just wondering do you think at that point you would have sufficient data to have a meeting with the FDA.

Pending on the outcome of all of these studies to move directly into a phase III program in obesity.

Would you anticipate needing the full dataset from momentum before you can move ahead to phase III.

Scott Harris: They were offered another 24 weeks, but a lot of people didn't have the time or set aside the commitment to go into for a full 24 weeks.

Scott Harris: So, that has to be understood.

Yes, Great question, Patrick the initial advice that we got from FDA and I want to stress initial was that they would like to see the full 48 week data before moving ahead to phase III, but we could certainly look at it what we have in the first quarter and see if that discussion should be held again.

Scott Harris: Nonetheless, we're happy with the rollover rate, but the 94 patients really allowed us to move a, robust number of patients from the 12-week study to 24 weeks. So, we see that as being a real positive on the readout that we're going to have at 24 weeks in the extension trial.

Scott Harris: So, with regards to the liver enzymes, we will have that data. This is not a NASH trial, so the level of liver enzyme elevations are not going to be great, but we are allowing for some liver function elevations at baseline.

Scott Harris: And we should be able to see a meaningful change in, ALT, for example, over the course of treatment of 12 weeks.

Again, when we approach them, which was the filing of the IND for obesity and that was we filed out at the end of 'twenty.

2021, we only had phase one data in a limited subset of patients and data prevails at those meetings. So when you propose.

Meetings, they won't have as much possible so their initial impression.

Not surprised is let's say 48 week data, but it's possible with the abundance of data that we're going to be generating in the first quarter that we could have that discussion earlier.

Mayank Mamtani: Thank you.

Yeah, great. Thank you very much.

Mayank Mamtani: And then having that less proportion of diabetics in the NAFLD study, just curious, what does that mean to, you know, the weight loss contribution?

Yes.

Thank you and then a follow up question from the line of Seamus Fernandez go ahead Lee.

Mayank Mamtani: Because I think it would be helpful to put in context what, you know, weight loss we saw in the SEMA-Testopatite studies, you know, type 2D diabetes versus non-diabetes patients.

Great. Thanks, guys. So just two quick follow ups.

The first question.

There was a publication.

From Novo Nordisk.

Highlighting a relatively.

Robust study of their own glucagon agonist.

In combination with with.

Mayank Mamtani: And maybe, you know, from your earlier phase 1 study, if you had any diabetes versus non-diabetes patients there.

I believe there are <unk> tied.

Just wondering if you guys could comment whether it be on that steady or at least on the safety of <unk> as it relates to heart rate elevations.

The triple <unk> agonists that Eli Lilly in their early phase one data saw substantial heart rate elevations that clearly would require.

Some factors there, but it's also our understanding that that's also tends to be associated with <unk>. So are you guys.

Being anything related to heart rate elevations.

Outside of what we would see normally with the <unk> one.

In your datasets at all.

Just wanted to start there just because that has been a critique from.

From Novo Nordisk, but we're not sure if it if.

If it applies here.

Or perhaps its even just purely molecule specific.

And then the second question please.

As we think about the possibility of entering larger phase III it would seem to us.

<unk> of the overall obesity efforts likely would have you guys.

With strong interest from potential partner, especially if you can keep the profile that you are talking about how are you guys thinking about.

The timing of when you think it's best to engage with potential partners from a strategic discussion perspective. Thanks.

Scott Harris: Yeah.

Hey, Thanks, Seamus So I'll answer the first question and then I'll turn to <unk> to answer the second question.

So.

As you know in that Triple G study the effects on heart rate.

Striking.

They announced that with multiple dosing they saw increases of about 10 pre beats per minute.

But actually in their single sending dose study earlier than that actually got 30 beats per minute. So why is that.

Is that because you simply add a glucagon to the molecule well we.

We would say a couple of things about that first is the amount of glucagon in that Triple G. As we understand it and I want to emphasize that is small.

That molecule appears to be curious appetite.

The lower ratio of <unk> to <unk>, one I think interest <unk> is 15 to one it looked like based on the data they presented that say to one but want to emphasize that the ratio of <unk>. One two glucagon that molecule is 10 to one this only.

One tenths the relative amount of activity in that molecule compared to the <unk> one.

So if there is any effect of that molecule. The <unk>, one and we've seen those heart rate increases before how do we explain and why aren't we seeing it with our compound.

We believe it's probably the pharmacokinetic effects.

If you look at the time to maximum concentration of our compound as we understand it as presented and graphs at the meeting.

It looks like it's very short about 12 hours and again I want to say, it's about because I'm estimating it from slides they presented without actually seeing the raw data.

It means is that when that drug is given there is a surge of drug.

Into the bloodstream with higher concentrations and immediate effect.

Contrast that with <unk>, where we see a maximal concentration that's actually several times greater than that not 12 hours, but 70 hours with a lower C. Max we've estimated that our C. Max compared to comparative doses of <unk> is about one third.

And what we have is an onset that is slower.

And perhaps more gentle used.

Using our non biological term, but we think that that accounts for the lack of heart rate increases now.

We presented that data at the Ada meeting.

That we're not seeing the heart rate increases of <unk>.

It's probable that as we.

Go further in development because this is a <unk> based compound that we'll see some increase but the initial data suggests that it's not going to be significant any more than <unk>, one, but again I want to emphasize that we have a small number of patients who will just observe.

As we go but.

We think that the heart rate increase that we're seeing with the glucagon containing compound we're not due to glucagon, we think it with nature the nature of the pharmacokinetics. So for the second question I'm going to turn that over to vipin.

Yes, Seamus I mean, we agree with you that this kind of data package that we are putting together and if we had able to maintain the profile that we've been highlighting that we expect and we do diet to have.

We expect to have significant interest to strategic interest in this in this program. So we'll explore that.

Right now we're focused on generating this data, we think thats whats going to drive the value proposition here.

Thanks. Thanks.

Thanks, so much guys.

And we have another follow up question from my Atlanta, Tony Go ahead. Please.

Hello, Thanks for taking my follow up and maybe just another kind of follow up.

Looking diner question like in terms of doing the CV outcome trial.

Do you expect that to be invaluable.

Phase III.

More sequentially.

<unk> as you know.

The reason I asked you. This question is would be the <unk>.

Reason no update.

The next study, but also I mean, you are trying to get to weight loss levels comparable to visit the died and duplicate all the time, so I'm just curious.

As you look forward.

Doing the outcome study evaluated doing a phase III does good longer term design blood into reimbursement and payer dynamics with the market.

Yes, Mike it's a great question.

I want to emphasize.

First that the conduct.

Of a cardiovascular outcome trials will not be gating to approval that we do it in parallel with phase III or afterwards.

These drugs are approved without having these trials upfront.

So.

And we saw that recently with Mon gyro tours appetite I think it's intriguing to think that we could do it in parallel it's not something that we've carefully looked out we think it's a very nice suggestion and we will certainly take a better look at it.

Thank you.

Okay.

Thank you and now I would like to turn the conference back to <unk> for closing remarks.

Thank you everyone for participating today, we appreciate this opportunity to share our results and outlook with you and thank you for your continued interests have a nice day.

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

Scott Harris: So I'll take the second part of the question first.

Scott Harris: Our first study was conducted, entirely with non-diabetics, so we can't really, you know, use any information from that study to predict what we would see in type 2 diabetics in the upcoming trial readout. I would emphasize, however, that 40% of the subjects who participated in the phase 1 study were pre-diabetics, and we saw a reduction in insulin resistance in that population.

Scott Harris: We saw the majority of those patients who were pre-diabetics becoming non-pre-diabetic.

Scott Harris: Regarding the lower percentage of patients who have type 2 diabetes in this trial, I would emphasize again the fact that we're going to read out separately in the three populations, the first being the non-diabetics, so that'll compare directly to step 1, which is the semaglutide first pivotal.

Scott Harris: The second would be in diabetics, so that would compare to step 2, and then a combination, although I don't think that the combination is meaningful, and that's why the change in the percentage, of diabetics is really not meaningful as well, because what we're interested in is the separate effects of non-diabetics and diabetics, with your correct understanding that typically in clinical trials, diabetics lose less weight than non-diabetics.

Scott Harris: Got it.

Mayank Mamtani: And my final question on the 48-week full readout timeline, just trying to understand, that gap between when you have the 24-week interim analysis in first quarter and that 48-week full analysis, which I'm assuming is going to be at the total sample size of 320, subjects.

Mayank Mamtani: Could you just provide what that gap could look like in terms of timelines?

Mayank Mamtani: And just maybe some color on what's the screen failure rate?

Mayank Mamtani: I think you gave a screening, number per week of about 25 subjects.

Scott Harris: Just curious if you could comment on how that rate is increasing month over month, and what's the failure rate look like?

Scott Harris: Yeah, so to be clear, Mayank, that 25 subjects per week is not a screening rate.

Scott Harris: That's an, actual randomization and dosing rate, okay?

Scott Harris: Those are subjects who are actually being dosed and put into the final data set.

Scott Harris: So based on that, we will have dosed our final patient by the end of September.

Scott Harris: The screening rate is obviously higher than that.

Scott Harris: We haven't gone public on what the screen failure rate is, but we're very, very happy with that. But it's obviously a lot higher, or somewhat higher, than that 25 subjects because of the, screen failures.

Scott Harris: You know, we are confident, obviously, about the readout at 24 weeks in the first quarter. And with the completion of the first – of patients receiving their first dose by the end of September, you can estimate where the 48-week readout would approximately occur in 2023.

Mayank Mamtani: Got it.

Mayank Mamtani: I'll hop back in the queue.

Mayank Mamtani: Thanks for the answer.

Operator: Thank you, and we have a follow-up question from the line of Seamus Fernandez.

The conference will begin shortly.

Mayank Mamtani: Questions.

Mayank Mamtani: Thank you.

Operator: Next question is from the line of John Wolleben of Jain Peace in Turkey.

Johan during Q&A, you can dial star one one.

Operator: Go ahead, please.

Jonathan Wolleben: Hey, good morning and thanks for taking the questions.

Jonathan Wolleben: A couple on the NAFLD, study.

Jonathan Wolleben: I was hoping you could clarify, I might have missed this, if diet and exercise instruction is part of this Phase I study that wasn't part of your prior Phase I.

Yes.

Jonathan Wolleben: And then you mentioned the average baseline weight is about 101 kilograms, which is substantially higher than you saw in Phase I.

[music].

Jonathan Wolleben: Wondering how you're thinking about, you know, how that might affect the weight loss you, see here versus the prior study.

Jonathan Wolleben: And Scott, you said this study was fully enrolled, but just looking for clarity on what percentage of patients rolled over into that 12-week extension.

Jonathan Wolleben: Thanks.

Jonathan Wolleben: Thanks, Jonathan.

Scott Harris: So you're absolutely correct.

Okay.

Scott Harris: We did not use diet and exercise in our initial, first in human study, and we are not using diet and exercise on the, in the current 12-week NAFLD study.

Scott Harris: So consequently, when we look at this, we're not going to see the 2% benefit of placebo because remember that the STEP and the SURMOUT and even the SURPASS trials were conducted over a baseline of diet and exercise.

Yeah.

Scott Harris: And the reason is, is because when a drug is approved for the treatment of obesity in the U.S., it's approved as an adjunct to diet and exercise. So it actually has to be in the study.

[music].

Scott Harris: The NAFLD study was designed without diet and exercise, the same as the initial Phase 1 study.

Scott Harris: However, the MOMENTUM Phase 2 trial, which is a committed obesity study, follows FDA guidances.

Scott Harris: This is designed exactly like STEP 1 and SURMOUT 1.

Scott Harris: And with that, we do have an intensive diet and exercise program.

Scott Harris: With regards to the higher, weight, the mean weights or median weights, I should say, that we saw in the Phase 1 study were approximately 90 to 95 kilograms, depending on the cohort. So this is somewhat higher, but it's not a lot higher.

Scott Harris: Our initial evaluations from our Phase 1 study suggested that we did not see an effect of body weight on either our serum concentrations or the amount of weight that people lost.

Scott Harris: But I'd also caution that that was a small number of subjects, and we'll have to see if that holds true as we go into this readout with a larger number of subjects.

Scott Harris: The extension study is fully enrolled.

Scott Harris: We're happy with the rollover rate.

Scott Harris: We're happy with the additional patients who have gone into the study.

Scott Harris: Following the increase of the size of the base study to 94, we haven't gone public on the percentage of rollover.

Scott Harris: We'll obviously have that data when we announce the 24 weeks, but it'll be a very nice data set.

Jonathan Wolleben: Got it.

Jonathan Wolleben: Thanks again for taking the question.

Jonathan Wolleben: Thank you.

Operator: Our next question is from the line of Patrick Trucchio of H.C.

Operator: Wainwright.

Operator: Go ahead, please.

Patrick Trucchio: Thanks.

Patrick Trucchio: Good morning.

Patrick Trucchio: I'm wondering, you know, in discussing the potential points of differentiation of PEM-V, peptide, if you can talk about the expected advantages specifically in type 2 diabetic patients, particularly in the areas of glucose control and lipid counts relative to other mechanisms in the field, and if you could also remind us the proportion of patients with obesity that would also be expected to present with type 2 in the real-world setting.

Patrick Trucchio: Thanks, Patrick.

Scott Harris: So regarding your first question in type 2 diabetes, the immediate, and I want to stress, the word immediate, target product profile for PEM-V dutide is not to have at least like a GLP-1 monotherapy acute glucose-lowering effects.

Scott Harris: We have balance in the compound between GLP-1 and glucagon, and we believe that that, at, the base case, is going to be maintaining glucose, and we saw that in our phase 1 study where glucose and hemoglobin A1C were maintained.

Scott Harris: So but over the course of time, recognize these patients lose weight, and it was stressed, at the recent ADA meeting that the focus in the treatment of patients with type 2 diabetes should focus, not so much of the focus should change from the treatment or the control of blood sugar to the loss of body weight, because the loss of body weight has a much more meaningful effect on their hemoglobin A1C over the course of time than the anti-diabetic effect.

Scott Harris: So consequently, we're very confident, given the amount of weight loss that we're seeing, that we're going to achieve drops in hemoglobin A1C over the course of more extended treatment. We're fairly confident we'll see that at 48 weeks.

Scott Harris: We're hoping we're going to see it at 24 weeks, but it's a shorter period of time with less, weight loss.

Scott Harris: We may see it at 12 weeks.

Scott Harris: That would certainly be only a plus, that we saw a drop.

Scott Harris: But at the same time, our base case is that we won't necessarily see a drop.

Scott Harris: We recognize that one of the principal factors in blood sugar elevations in type 2 diabetics, is insulin resistance, and a great portion of that comes from the liver, and it's related directly to liver fat.

Scott Harris: And when you see liver fat being decreased as dramatically as we are with penvadutide, and that's due to glucagon effects, we think we're going to see a drop in insulin resistance that's also going to contribute to the blood sugar decreases over time.

Scott Harris: So just to reiterate, we do feel confident that this is an anti-diabetic drug over, say, 48 weeks, perhaps 24.

Scott Harris: Our base case at week 12 is that we won't see it, because the hemoglobin A1C averages, out the blood sugar over 12 weeks, even when you don't initially have weight loss.

Scott Harris: But an upside would be that we saw a drop in hemoglobin A1C or fasting blood sugar in, Regarding the lipids in diabetics, it should be clear that diabetics do suffer from the effects of blood sugar, and those elevations result in microangiopathies, such as diabetic eye disease, diabetic kidney disease.

Scott Harris: But the predominant reason for death in type 2 diabetics is serum lipids. And consequently, drugs that more effectively move serum lipids are going to have better, cardiovascular outcomes than those that don't.

Scott Harris: And I want to, again, contrast the reductions in serum lipids that we saw, particularly, total LDL cholesterol in our phase 1 study at 20, 30 percent, and contrast that to the only 3 percent reductions in total in LDL cholesterol in the step 1 clinical trial.

Scott Harris: And we think that ultimately that's going to have major benefits on cardiovascular outcomes, when we conduct those clinical trials.

Scott Harris: Regarding your question, Patrick, about the percentage of obese patients who have type, 2 diabetes, it's about 20 percent.

Scott Harris: Got it.

Patrick Trucchio: That's really helpful.

Patrick Trucchio: And then just another follow-up question.

Patrick Trucchio: You know, we looked at the first quarter of next year.

Patrick Trucchio: You're going to have the interim data for momentum.

Patrick Trucchio: You'll also have the phase 1B natural disease study 12-week and 24-week data, and as well, as phase 1 study data in diabetic subjects, so additional safety data.

Patrick Trucchio: I'm just wondering, do you think at that point you would have sufficient data to have a meeting, with the FDA, depending on the outcome of all of these studies, to move directly into a phase 3 program in obesity, or would you anticipate needing the full data set for momentum before you can move ahead to phase 3?

Scott Harris: Yeah, great question, Patrick.

Scott Harris: The initial advice that we got from FDA, and I want to stress initial, was that they, would like to see the full 48-week data before moving ahead to phase 3, but we could certainly look at what we have in the first quarter and see if that discussion should be held again.

Scott Harris: Again, when we approached them, which was at the filing of the IND for obesity, and, that was we filed that at the end of 2021, we only had phase 1 data in a limited subset of patients, and data prevails at those meetings, so when you propose meetings, they want to have as much possible.

Scott Harris: So their initial impression, and I'm not surprised, is let's see 48-week data, but it's possible, with the abundance of data that we're going to be generating in the first quarter that we could have that discussion earlier.

Patrick Trucchio: Yeah, great.

Patrick Trucchio: Thank you very much.

Patrick Trucchio: Yeah.