Q3 2022 Altimmune Inc Earnings Call

November 10, 2022

The conference will begin shortly to raise your hand during Q&A you can dial star one one.

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Yeah.

Okay.

Good day, ladies and gentlemen, and welcome to the Ultimate Inc. Third quarter financial results Conference call. At this 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 a press star one on your telephone.

This call is being recorded I would now like to introduce your host for today's conference rich.

I used that chief financial officer of element.

Rich. Please go ahead.

Thank you Michelle and good morning, everyone. Thank you for participating in <unk> third quarter 2022 financial results Conference call members of the Ultimate 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 following the <unk>.

<unk>.

And answer session.

Release, with our third quarter 2000 financial results was issued this morning and can be found on the Investor Relations section of the company's website.

Before we begin I would like to remind everyone that remarks about future expectations plans and prospects constitute forward looking statements for purposes.

Under the private Securities Litigation Reform Act of 1095, <unk> 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.

<unk> on our business operations clinical trials and results of operations.

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.

I would also direct you to read the forward looking statement 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 November 10, 2022, and the company does not undertake any obligation to update any of these forward looking statements to reflect events.

Stances that occur on or after today.

As a reminder, this conference call is being recorded and will be available for audio replay on <unk> website.

I will now turn the call over to talk Rebecca Gardner Chief Executive Officer of <unk>.

Sure.

Okay.

Thank you rich and good morning, everyone.

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

We are excited about the progress we are making with bandages tight our DLP one glucagon dual receptor agonist that we continue to advance <unk> two important clinical indications obesity and Nash.

The recent data from a phase one b national deep trial highlighted is 68, 5% relative liver fat reduction at 12 weeks in the one eight milligram dose group.

Which translated into more than half of those subjects, achieving a normal liver fat content of 5% or less.

These promising effect on liver fat content, what accompanied at week 12 by significant reduction in serum <unk> levels and CB, one imaging relaxation types.

Both recognized biomarkers of fibrosis inflammatory activity.

Subjects, receiving <unk> also lost a significant amount of body weight.

It differentiates <unk> from other drugs with comparable effects on liver fat and LTE reduction.

This is important because excess body weight is believed to be a principal driver of Nash and its co morbidities and weight loss represents an important therapeutic goals in the treatment of these patients.

In mid December the <unk>.

<unk> to announce the topline data readout on a trial extension that after 12 weeks of additional treatment to subjects, who completed the original 12 week phase one b trial in subjects with Maserati.

A key readouts will be similar to the Readouts in the original 12 week study.

Scott Harris will join us shortly.

To discuss our expectations for that readout.

Obesity remains our primary focus and we completed randomization and first dosing of all subjects in our 48 week phase III momentum obesity trial at the end of September .

A 24 week interim analysis is planned for Q1 2023, when we expect that approximately 160 subjects will have completed 24 weeks of treatment.

We believe the interim readouts should demonstrate meaningful weight loss.

With favorable tolerability in the absence of dose titration.

Which could differentiate <unk> from other obesity products.

Scott Harris will present more on momentum trial in a moment.

Enrollment is also completing our 12 week phase <unk> multi center safety trial in subjects with type two diabetes.

We expect this trial to provide important information regarding the ability of <unk> to maintain glucose control in this population as measured by hemoglobin <unk> C and serum glucose levels.

Finally, we.

We are continuing to enroll our phase II multicenter trial of <unk> in subjects with inactive chronic hepatitis b and expect to have a data readout in the second half of 2023.

Call that this study is designed to show evidence of antiviral effects against HBV and establish its potential role in combination therapy for the treatment of this important disease.

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

With that I will now turn the call over to our Chief Medical Officer, Dr. Scott Harris to discuss our data and clinical plans.

Thank you Vincent and good morning, everyone first let me briefly review the results of our phase <unk> trial and additional data that was presented by Dr. Stephen Harrison at the late breaker abstract at the annual meeting of the American Association for the study of liver diseases in Washington, DC on November the <unk>.

Seven.

As Vipin noted a 68, 5% relative liver fat reduction was achieved in the $1 eight milligram dose group at 12 weeks of therapy, which translated into more than half of those subjects, achieving a normal liver fat content of 5% or less.

These promising effects on liver fat content were accompanied at week 12 by significant reductions in serum alanine aminotransferase, a marker of hepatic inflammation.

Reductions of these predominant parameters have predicted a high likelihood of success in biopsy endpoints. When later late stage clinical trials are conducted.

Dr. Harrison presented new data at the greater than 83% of subjects, who received <unk> in <unk>.

Participated in a corrected with T one or Cte one imaging sub study.

<unk> and 80 milliseconds or more reduction in <unk> relaxation times at week 12 at each <unk> dose.

<unk> is a measure of fiber inflammatory activity in the liver.

And an elevated CET one score has been correlated with hepatic in cardiovascular events and clinical studies, specifically and 80 million second reduction that's been shown to correlate with a two point improvement in novel <unk> activity score on liver biopsies.

We believe these findings add further to the likelihood of success on biopsy endpoints as well as the likelihood of reduced hepatic in cardiovascular events when outcomes trials are conducted.

Next let me talk about our upcoming readout in our 24 week multicenter trial of subjects with <unk> in mid December and extension. So the original 12 week phase <unk> trial.

66, or approximately 70% of subjects from the original 12 week phase <unk> novel trial rolled over in this into this extension trial to receive an additional 12 weeks of <unk> or placebo for a total of 24 weeks of therapy.

The subjects that rolled over have remained double blinded with respect to their assigned treatment of either one to 1824 milligrams of <unk>.

Or placebo.

As we initiated this study well after enrollment in the original 12 week novelty trial had commenced we are pleased with the 70% rollover rate into this trial.

The principal readout will continue to be the safety and Tolerability of Perm do Todd with reduction in liver fat content as the primary efficacy readout.

The readout in December will also include weight loss measures of liver inflammation, including serum ALC.

CET, one relaxation time lipids hemoglobin <unk> C fasting glucose blood pressure and heart rate and adverse events, including adverse events leading to treatment discontinuation.

We report consolidated and stratified data on the trial readouts for subjects with and without diabetes.

Now, let me talk about the phase III momentum trial of <unk> in obesity.

The trial was designed to enroll approximately 320 number diabetic subjects with obesity are overweight with at least one comorbidity.

Subjects were randomized one to one to one to one to one two milligrams or one eight milligrams two four milligrams of placebo Pemba do Todd or placebo administered weekly for 48 weeks in conjunction with diet and exercise.

The baseline characteristics of the fully enrolled study population include median body weight and body mass index BMI of approximately 101 kilograms, and 36 kilograms per meter squared respectively.

And median fat content of approximately 5%.

Measured in approximately 100 subjects participating in the body composition sub study.

The study population is approximately 75% female and approximately 20% of the subjects are of Hispanic ethnicity.

These demographics contrasts sharply with the study population in the 12 week phase <unk> trial.

We're approximately 80% of subjects were of Hispanic ethnicity, and the median fat content was approximately 22%.

In addition, unlike the phase <unk> trial.

The phase II momentum study.

<unk> employs endpoints and lifestyle interventions that are standard.

For multicenter obesity trials.

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 Dr.

Dr. Lu eroding from Cornell Wildhorn, Yale Medical School, a leading authority in obesity and obesity clinical trials is <unk>.

Serving as the principal investigator.

We plan to perform an interim interim analysis to assess changes in body weight. After 24 weeks of treatment when approximately 160 <unk> study participants in the first quarter of 2023.

It should be noted that as a result of variations in patient characteristics as the trial enrolled the demographics of the study population could differ from those in the fully enrolled study population when the interim readout occurs.

It is our expectation that a level of weight loss consistent with the class leading obesity drugs may be achieved at the end of 48 weeks of therapy.

We also believe that the Tolerability profile of Panther do Todd the absence of dose titration and reduction in serum hepatic lipids.

Could translate into greater ease of administration, it proved adherence to therapy and greater potential for cardiovascular benefit.

We believe these benefits should differentiate <unk> from other drugs in the obesity space.

We have also completed enrollment in our phase <unk> multicenter trial evaluating glucose control in subjects with type two diabetes over 12 weeks of treatment.

Approximately 48 subjects are planned with readout expected in the first quarter of 2023.

Across the trials that I have described we are rapidly building the safety profile of FEMSA do Todd with Unblinded safety data in crude and over 200 subjects, receiving one or more doses of <unk> in clinical trials by year end 2022, and approximately 500 subjects by year end 2023.

We believe that a positive effect on surrogates of cardiovascular outcomes, including blood pressure serum lipids and paddock fat content will be demonstrated at final readout.

We are also making continued progress in the enrollment of our phase II multicenter clinical trial of <unk> in subjects with inactive chronic hepatitis b and.

And expect to read out the results of this trial in the second half of 2023.

Recall that the Virologic effects of Hep T cell are also being a value are being evaluated in a chronically infected patient population to enable the combination of Hep T cell with novel direct acting Antivirals as part of combination therapy for hepatitis B.

I'll now hand, the call over to Ritch Allison start to give an update on our third quarter financial results rich. Thank you Scott and good morning again, everyone for today's call I'll be providing a brief update on our communities third quarter 2020 financial results.

Our comprehensive information will be available in our Form 10-Q to be filed with the SEC later today.

<unk> ended the third quarter of 2022 with approximately $201 $9 million of cash cash equivalents and short term investments compared to $193 million at the end of 2021, we drew down approximately.

Approximately $31 million in net proceeds off of our ATM during the three months ended September 32022.

Turning to the income statement revenue was minimal in the third quarter of 2022 compared to $200000 in the same period in 2021.

Our change in revenue for the quarter was primarily due to discontinuation of the development activities for our T. Covid at Natus programs earlier in 2021.

Research and development expenses were $23 million in the third quarter of 2022 compared to $29 $2 million in the same period in 2021.

Ultimately 15 $8 million at this total for the third quarter of 2022 were direct expenses for the conduct of our clinical programs, including $14 million of direct costs related to development activities for having to do tie and $1 $8 million in direct costs related to development activity.

Yes.

R&D expense in the third quarter of 2021 included approximately $15 million of expense to close out the AG Covid campaign.

General and administrative expenses were $4 $5 million in the third quarter of 2022 as compared to $4 $2 million in the same period of 2021.

The increase year over year was primarily attributable to increased stock compensation expense.

Net loss for the three months ended September 32022 was $23 5 million or <unk> 48, net loss per share compared to $33 $5 million or <unk> 81, net loss per share for the third quarter of 2021.

Our existing cash not only funds us through all of our ongoing clinical trials.

We estimate that our cash sufficient to allow us to operate into the second half of 2024.

I will now turn the call back over to <unk> for his closing remarks.

Thank you rich.

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

Thank you if you have a question at this time. Please press star one on your telephone one moment, while we compile the Q&A roster.

Our first question comes from the line of Seamus Fernandez with Guggenheim. Your line is open. Please go ahead.

Great. Thanks, so much for the question. So really just wanted to ask if you guys could help us understand.

But the.

The characteristics of the patients.

Of the 70 patients that were in.

They're going to be in the extension 24 week.

A portion of the study.

So.

Do you have the 12 week data.

In that context and.

Can you provide us a little bit of information with regard to.

If there were any differences in the data.

For those 70 or so patients versus the overall steady.

And if there are any meaningful differences at <unk>.

The other dose levels in particular, I, just wanted to get a better understanding of the base characteristics of that patient population as we head into the full 24 week data.

For the <unk> patient population and then the second.

<unk>.

Just as we kind of advance forward we saw.

No real change and in fact, some increases in HBA one fee.

In the first 12 week data set in the Napp L. D patient population just trying to get a better sense of how you guys are thinking about the profile of the product if we don't see improvements.

HBA one C as patients are treated over time, thanks, so much.

Scott, Yeah, Hey, Seamus. Thanks for the question just to clarify there was 70% rollover, but actually the number of subjects was 66.

Don't have that immediate data for you I can tell you that from 10000 feet I think that the rollover study population is comparable to what entered the initial original 12 week trial.

But I don't have specifics for you at this time.

And.

Our position has been that there's been no change in the hemoglobin <unk> C.

No change we will have further information on that when we finish our 12, we committed diabetes study in the first quarter of this year. Our position has always been that we would not see a change in hemoglobin <unk> at 12 weeks and that we would see changes over time as insulin sensitivity improved concomitant with improved weight loss.

And that's what we expect to see at future time points, but because of the opposing effects of glucagon on on DLP inquiry activity.

The base case, it always has been that with the hemoglobin <unk> C, which is retrospective to eight to 12 weeks over the time period when the weight loss had been fully occurred that we wouldn't see it.

Great and then maybe just a quick follow up question in terms of your expectation if the baseline.

Characteristics of the 66 patients.

Ends up being comparable.

Can you just help us understand what you think is a good result in this patient population.

From a weight loss perspective, particularly.

Given the.

I guess substantially different.

Metabolic characteristics of these patients.

With over 20% liver fat in the Hispanic patient population I'm just wondering what you guys think.

As a as a particularly good result in that patient population from a weight loss perspective. Thanks.

Well I think you hit the nail on the head. This is a distinctly different population from that is the natural D population. That's continuing the extension from the momentum trial only obesity trial. It is metabolically very ill population with over four times, the amount of liver fat and whether are there or not.

Theyre diabetics their metabolic oil like diabetics and you don't expect them to lose weight and then it's fairly clear that there is a very important impact of Hispanic ethnicity.

It's been shown in various studies and that population has also been reduced and prevalence by a factor of four so.

So we look at that <unk> <unk> study in this extension is being what it was suited for which was to look at reduction of liver fat and although we're seeing a reduction in liver weight, it's not a weight loss study and it's not our primary readout in weight loss, we suspect that will continue to see improvements of weight loss, but we have not really gauge what that weight loss.

Just to be to predict what we're going to see them in momentum we think Thats study stands alone.

Okay.

Thank you guys I'll drop back in the queue.

Thank you and one moment for our next question.

Okay.

And our next question comes from the line of Yasmin Rahimi with Piper Sandler. Your line is open. Please go ahead.

Good morning team. Thank you so much for the detail and update two questions to you. This morning, maybe the first one to start off would be.

When you noted that on the 60 patients that we will get 24 week data can you help me understand how many of the patients will be on Dragon, how many will be.

<unk> Thibault.

And then.

Given that.

Some of the patients who may have not chosen.

You need to the extension or are there any reasons behind that so that's sort of part one and part two.

Dan.

The next question I have for you is I'm very excited for that phase one be diabetes study that youre going to readout in <unk> 23.

Help us understand what you hope to gain from that.

Patient study do you think it's going to give us really a definitive answer in terms of presenting the tight.

It goes back so I'd love to hear your color on both.

Three questions then thank you again for.

Taking a great question.

Yes, Scott Thanks for the question. So let me take them one by one.

We have not unblinded, the 106 data so I can't tell you, which patients have continued at each dose we have no information on that so I can't give you a snapshot.

Of the continuation rates at each dose.

Or.

How much of the placebo patients continued versus or the reasons per group of the discontinuation generally the discontinuation reasons were administrative not that the patients discontinued, but you have to realize that patients were recruited for 12 week study and regardless of their success.

Many people simply said I don't have the ability to remember theyre getting are coming into the clinic weekly for 12 weeks to come and weekly for an additional 24 weeks at an additional 12 weeks up to 24 weeks would be an undue burden.

And also the study started late so some people just didn't have access to the study <unk>.

And by and large it was due to non safety reasons or non efficacy reasons that people chose not to continue.

Regarding the phase one study that will read out in the first quarter of the year.

Primary objective of this study is safety. The aim is to show that there is no adverse effects.

FEMSA do Todd on blood sugar control and Thats been our base case, we need to demonstrate that going forward and accrue more patients to show that the serum glucose and hemoglobin <unk> do not change no additional studies will likely be conducted in the future looking at long.

Your durations of treatment to see the hemoglobin <unk> drops.

But that's beyond the initial 12 weeks that's planned in the phase one study with the objective of the trial.

Yes, just to just to remind everybody that the 24 week 48 week momentum studies in non diabetic study. So that's why it's important to have that separate studies. So we can look at specifically in subjects with diabetes and that's really the reason for that is for that study.

Great and then Tim just one quick clarification I appreciate it.

This time demographic details that you gave us further momentum.

101 hundred kilogram 36 kilograms BMI in the distribution is that for the total population or.

Is it for the 100 patients if you could just clarify that would be helpful and I will jump back into the queue.

It's a great question, yes, when we try to bring it out and I tried to bring it in my opening remarks, but let me repeat it.

For the entire study population.

We don't have specific information for you today on those first 160 or so patients that were.

That are part of the interim analysis, we're saying in a generic way the population demographics can shift.

Over the course of the four to five months of enrollment of the study and that it's possible, we're not saying that it's likely that it's possible that what we're going to readout in the first quarter of next year the demographics may differ.

Expect that would differ slightly.

But.

We are announcing the demographics of the population, we're going to make it clear that the first 160 or so subjects.

Have exactly these characteristics when they read out because they vary over the course of the trial.

But it's fair to say that we have any stock difference here between the naphtha depopulation in the obesity spending buckets and Thats really the point that we've been making that we had significantly larger. Hispanic population as you can see that in.

On the numbers.

Difference same thing with the liver fat content and of course, the conduct of the study itself. This is a more traditional.

Obesity study, which is being conducted at obesity centers the whole the whole feeling about the study is different from from a compared to a liver fat reduction study.

Thank you so much for that color very helpful.

Thank you one moment for our next question.

And our next question comes from the line of Lisa <unk> with Evercore ISI. Your line is open. Please go ahead.

Hi, Thanks for taking my question first of all for that for the <unk> update can you just give us your expectations are you expecting that the next readout to be kind of like linear in nature in terms of the obesity SRA.

Generally what is the right expectation does that.

Lisa linear expectations for traditional weight loss study.

And we expect the weight loss of momentum to be linear.

This population is very different there is no prior information about how the study population.

We'll we'll react will lose weight the combination of the highest spandex, the very highest spandex and probably the highest liver fat content. That's been studied to date are in trials with.

We just don't know what the weight losses, we know it's going to increase.

We're not making any projections about the linearity because we think the study is so different from momentum trial. It bears no relevance to predicting the results of momentum.

Okay.

And then for.

Yes.

For the momentum.

Obesity study what should we expect.

The effects of.

Diet and exercise of lifestyle changes to be at 24 weeks like what kind of an impact would you expect that to have is that like a couple percentage points Sir.

Yes, so im looking across other trials like this tough trials and the surmount trials and typically the weight loss peaks at about 2% around week 12, and then maintains itself over the course of the trial or to.

So say 24 weeks.

Okay.

And then for the diabetes study that the 12 week safety study.

Well. This should we think of this does kind of a weight loss study or how shall we be thinking about.

Kind of.

What what sort of read through to take from from from this study in terms of the efficacy component.

Well once again like the novel <unk> trial that we just talked about the diabetes study is not being conducted as a weight loss trial.

Can be conducted as a diabetes safety trial. So we're not really relying on that trial to give us a readout on diabetics, we think that our committed obesity trial in diabetics would provide that answer, but we're not conducting that trial right now.

Okay.

I think thats it for me for now thank you.

Thank you and one moment for our next question.

And our next question comes from the line of Matt <unk> with B Riley. Your line is open. Please go ahead.

Good morning, Deane. Thanks for taking my question and congrats on the progress with three ongoing plans. So maybe just a clarifying question for you commented about the momentum.

Data expectations, and then you see.

Lastly, just to clarify you mean glucagon directed therapies.

And broadly.

As you know for the latter.

Even for six months, the meat laws by maybe getting elevated even high teens.

Some of the emerging data side I just wanted to clarify.

What sort of your landscape.

Molecule looked like that when you think about weight loss of momentum.

Yes, that's a good question Manny.

If you look at the progression of weight loss. The first wave of <unk> Gratton had about 15% now we are approaching 20%. So really it's that ballpark. We are talking about ultimately we believe that there is going to be multiple products approved in this space and weight loss is going to be important but not the only component of overall.

Our value proposition.

Multiple drugs will be approved for marketing and then depending upon what is that overall profile of the safety Tolerability ease of administration.

Lipid profiles are going to be very important ultimately.

It's all about cardio cardio metabolic health that we're trying to improve here.

So that's what we mean is that going to.

Have to be that in that ballpark of the leading drugs in terms of weight loss, but then when you look at all of the other characteristics. We think there'll be multiple drugs that would that would find a place it's a very heterogeneous.

Patient population and physicians doctors are going to need multiple options to treat this disease.

These subjects.

Scott.

Did you want to.

Jumping.

My Inc.

There's been some recent information on a compound that came out from Amgen where.

Initial data was presented and very impressive weight loss and you might be referring to that is now being in the mix.

We took note of that and we congratulate them on the excellent results and shows the drugs can really have weight losses that are starting to approach bariatric surgery. We are happy to be in that group of drugs. So that we think can achieve that.

We'd want to stress with drugs that it's a new mechanism of action and approach there hasnt been sufficiently explored.

We know about the <unk> antibody combination.

We know about the <unk> and VIP, specifically that they do not have meaningful effects on serum lipids and.

And they don't have meaningful effects on hepatic lipids, and therefore, they're going to be coming up with less than a full.

<unk> approach to cardiovascular outcomes reductions because of the absence of that effect in the relying mainly on weight loss.

So we think that's still a problem with those drugs.

Finally, not only don't we know about long term efficacy you're seeing a snapshot of results at a limited time point and the 12 week range.

But with the new mechanism of action the long term safety is not known.

And in specific with regards to the compound, it's known that <unk> prevents bone resorption and humans or human data on that and now we're giving antibodies against Gi peak that a deleterious effects on bone health, particularly in women, particularly with women with obesity, who put more stress on their bones. So I think that we congratulate.

<unk> and the results we're happy to be in the mix for long term weight loss and we're glad to see the bar going up and up but theres a lot more of that has to be known about the mechanism of action, particularly on the safety side.

Thank you that's very helpful. I think in more in a month's time from both you and <unk>.

And then just a couple of quick questions on the naphthalene diabetes study. So is it is it <unk>.

Beyond that.

Most of the crossover patients.

The 68 patients with the Diamond elite license bonded, which means you may not have many in placebo and <unk>.

Unions, what that May mean for kinetics of liver fat and dividends and should be focus on placebo adjusted numbers for that 24 week readout.

<unk>.

Yes, Mike.

Mike I wish I could answer the question, but because were blinded I just don't have that data right and in terms of the kinetics once again, let.

Let me emphasize that this study was conducted.

To look at reductions to liver fat and I want to highlight the fact that the reductions in liver fat were excellent.

We're just excellent.

And it was accompanied by many markers of good outcomes like the reduction of <unk> and the reduction of CET one.

Times, an MRI scanning.

So that was the primary readout of the study and we went out to recruit a population with very very high liver fat came out of mainly Hispanics of Mexican origin ethnicity, and the southwest parts of the United States, which is what we should do for natural D. Trial. This is not a weight loss trial, yes, we.

And observed weight loss, we are happy with the weight loss that we saw in the first trial that was commensurate with <unk> on the placebo adjusted basis. So we're very happy with that but we're trying to emphasize because of the great differences in the populations and the very nature of the way that the study was conducted.

With there being no branding or no emphasis on weight loss no communication on weight loss really.

Two patients even investigators in the study that the kinetics of weight loss in this population of the kinetics of weight loss and the population. They don't translate to the kinetics that we're going to see in dedicated obesity trials with patients dedicated obesity patients with one quarter the amount of liver fat in one quarter the amount of Hispanics.

Yes, I would just add that in terms of liver fat reduction further improvement in that as you as you know that we've already gotten such a significant liver fat reduction <unk> improvement that going from 12 to 24 week you might improve some but we've already reached a.

Such a liver fat reduction occurred relatively quickly anyway. So so just just to be sure.

We have already achieved significantly we're fat reduction and justify two hour weeks.

Thank you and one for rich quickly does the cash runway guidance include any.

The integration, you're starting phase II Nash biopsy study, possibly next year.

So let me just clarify that.

Thanks again for taking my question.

Okay.

The.

Patients will be spending money to get ready for phase III.

<unk>.

And obesity <unk> or for Nash. So we clearly don't have the cash.

And complete a full phase III campaign.

For obesity.

We haven't really necessarily designated which dollars are going which direction, but we can get started in either of those indications.

Yes, our goal is to be both phase II ready for Nash.

And phase III ready for obesity.

All lines will be difference that we're already working on putting together those plans in place.

For Nash, we should be ready for phase II by the second quarter of next year. So we can execute that trial, if we decided to do so and for obesity will not wait for the 48 week data and we'll be ready for that the execution of that phase III in the first half of 2024, yes, just to be specific we would not stop.

The Nash trial, R&D Nash trial before we see the interim readout.

A piece of it.

Okay. Thanks for clarifying that.

Thank you and one moment for our next question.

Our next question comes from the line of John Wilman with JMP Securities. Your line is open. Please go ahead.

Hey, thanks for taking the questions.

Couple from me.

You previously commented that the blended weight loss for momentum was tracking in line with the first phase one study. So I was wondering if you could update us on how that's looking over time and then secondly on the diabetes study Scott you mentioned the key here is to be on ACF tariff glucose just wondering if there is any.

More specifics of bars on.

Worsening levels that are acceptable or is any change.

A clear negative here, just hoping for a little more specific there.

Yes. So regarding your first question, Jonathan we took a single snapshot of the data at one time point that was comparable to the time points and the novelty trial.

I'm talking about the amendment on snapshot and the 101 excuse me of the first in human study that was done in Australia, we have not been <unk>.

Following blinded weight loss curves over time, so I can't communicate that data to you we don't have that data.

Regarding the hemoglobin <unk> C and the glucose.

The.

Diabetes study that will read out in the first quarter, yes, it's a safety study.

Our base position has always been there will not be any.

<unk>, we don't expect any worsening.

And.

That continues to be our position that we will see maintenance of glucose control in these patients.

That's helpful. Thank you.

Thank you and one moment for our next question.

And our next question comes from the line of Patrick <unk> with H C. Wainwright. Your line is open. Please go ahead.

Hi, This is Matthew Lucas on O&M on for Patrick today.

So my first question is going to be rigs.

Regarding the potential for <unk> in Nash and can you discuss how it compares to others in the field and where would you envision it situated in the emerging treatment paradigm.

Well, thank you Matthew.

Well.

The data that we have we think compares.

To every any drug.

The best liver fat reduction has been seen up till now with the flux of firm and we think that our data.

Is at least comparable to that in better in some ways.

So there is a strong literature that.

Reduction in liver fat translates to success on Nash resolution and fibrosis improvement endpoints and late phase trials, we've seen previously with the magical data. It was seen when the MGM program was active and we've seen very strongly with the <unk> data and we would.

With.

The same if not better levels of liver fat reduction probably achieved in a shorter period of time.

That we will see comparable effects.

In a.

Late Phase Nash trial, and we've received comments from Kols like Stephen Harrison.

This is the best data that <unk> seen yet at this phase of development. It's also a company now by the changes of the correct T. One or CET, one data and that's very important because that maps <unk> and fibro inflammatory activity the same way the ALC marks inflammatory activity noninvasive.

Markers that have appeared to be very predictive of success in biopsies.

But going if you would allow me outside of the exact.

The field of Nash.

Cardiologists are now looking at CET, one data inflammatory activity in the liver to predict inflammatory activity in.

Coronary and cerebral vascular plaques.

And they've also draw an inference from reductions of <unk>, one is improving cardiovascular outcomes.

I think that our positioning in Nash is really excellent.

And not only do we have comparable levels of liver fat data in at least as good reductions in fibro inflammatory activity.

And our current trials with one thing that the other compounds in Nash with similar levels of fat reduction don't have which is meaningful weight loss.

Loss with the flux affirming.

I believe it was <unk>.

24 weeks was approximately two 6%.

We're seeing about double that in about one half the time.

You know what gets these people in Nash into trouble is.

They are being overweight and the principal morbidities of Nash.

Or not necessarily deliver effects, but the cardiovascular spec effects, especially in the early phases of the disease and weight loss is very meaningful for these people.

So holistically from the point of view of liver fat reduction and reduction of inflammatory activity fibro inflammatory activity plus the meaningful reduction of word I think that we stand alone in the Nash spectrum of drugs in development.

Perfect. Thank you I appreciate that.

The next one I had is.

It's a follow up question on the safety and Tolerability profile of <unk>.

Particularly the discontinuation rates that you've seen so far and then how does that compare to others in the field and then can you discuss what the dropout rate has been or is expected to be in the momentum program.

Great.

I can quote you the discontinuation rates on our first in human trial for adverse events, which were zero percent.

In the natural D trial. It was zero percent of one two milligrams about 4% at one eight milligrams in about 4% a two four milligrams about what half of what you would see in us.

Other trials.

If you look at the momentum trial and of course, we won't know the dropout rate on that trial. So the trial is completed but typically in obesity trials, we've seen very very high dropout rates, but with improvements in the way. The Charles have conducted we've seen dropout rates of about 20% in the more recent trials.

I cannot tell you that that will be the dropout rate momentum by the time. The 48 weeks is concluded but.

Those are the range. That's the range has been seen in other trials that have preceded us.

Great. Thank you and then I have one more following the AI as LD I'm wondering if her preferences emerging for all team in terms of which antiviral mechanism you would prefer to combine with the Hep T cell program.

Okay.

Hey, Matthew this is Scott Roberts.

I think theres, a number of options out there, but in general I think that the approaches whether their algo based or RNA base that that knockdown of surface antigen and begin to.

Released the immune suppression that is characteristic of chronic hepatitis b those probably make the most sense. So you can imagine a scenario where those types of agents are used first surface antigens decrease that T cell responses are beginning to wake up and respond and then we come in with a hefty sell it and help boost those responses.

The the antigens that are being expressed in hepatocytes. So I think there's probably a number of ways to look at that there is some scheduling issues that have to be looked at but conceptually I think thats, probably the most straightforward approach.

Perfect. Thank you I appreciate it.

Thank you and I'm showing no further questions at this time I'd like to turn the conference back over to fit them guard for any further remarks.

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

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

The conference will begin shortly to raise your hand during Q&A you can dial one one.

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A reminder, this call is being recorded I would now like to introduce your host for today's conference rich.

I am stat, Chief financial officer of element.

Please go ahead.

Thank you Michelle and good morning, everyone. Thank you for participating in <unk> third quarter 2022 financial results Conference call members of the Ultimate team joining me on the call today are different guard, our Chief Executive Officer, Scott Roberts, Our Chief Scientific Officer, and Scott Harris, Our Chief Medical Officer following the prepared.

<unk> remarks, we will be a question and answer session. A press release with our third quarter 2020 financial results was issued this morning and can be found on the Investor Relations section of the company's website.

Before we begin I would like to remind everyone that remarks about future expectations plans and prospects.

Forward looking statements for purposes of Safe Harbor.

Under the private Securities Litigation Reform Act of 1095 after being 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 impact on our business operations.

Nickel trials and results of operations for.

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 Companys filings with SEC.

Hey.

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.

Stances that occur on or after today's base.

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 talk with regard Chief Executive officer of <unk>.

Okay.

Thank you rich and good morning, everyone.

Appreciate you joining us today for a discussion of our third quarter 2022 financial results and business update.

We are excited about the progress we are making with bandages diet. Our DLP one glucagon dual receptor agonist that we continue to advance <unk> two important clinical indications obesity and Nash.

The recent data from a phase one b <unk> trial highlighted is 68, 5% relative liver fat reduction at 12 weeks in the one eight milligram dose group, which translated into more than half of those subjects, achieving a normal liver fat content of 5%.

Or less.

These promising effect on liver fat content, what accompanied at week 12 by significant reduction in serum <unk> levels and CP, one imaging relaxation types.

Both recognized biomarkers of Fibrilla inflammatory activity.

Subjects, receiving <unk> also lost a significant amount of body weight.

Each differentiate spending do died from other drugs with comparable effects on liver fat and LTE reduction.

This is important because excess body weight is believed to be a principal driver of Nash and its comorbidities and weight loss represents an important therapeutic goals in the treatment of these patients.

In mid December the <unk>.

<unk> to announce the topline data readout on a trial extension that after 12 weeks of additional treatment to subjects, who completed the original 12 week phase one b trial in subjects with <unk>.

The key Readouts will be similar to the Readouts in the original 12 week study.

Scott Harris will join us shortly.

To discuss our expectations for that readout.

Obesity remains our primary focus and we completed randomization and first dosing of all subjects in our 48 week phase II momentum obesity trial at the end of September .

A 24 week interim analysis is planned for Q1 2023, when we expect that approximately 160 subjects will have completed 24 weeks of treatment.

We believe the interim readout should demonstrate meaningful weight loss.

With favorable tolerability in the absence of dose titration.

Which could differentiate <unk> from other obesity products.

Scott Harris, who will present more on momentum trial in a moment.

Enrollment is also completing our 12 week phase <unk> multi center safety trial in subjects with type two diabetes.

And we expect this trial to provide important information regarding the ability of <unk> to maintain glucose control in this population as measured by hemoglobin <unk> C and serum glucose levels.

Finally, there.

We are continuing to enroll our phase II multicenter trial of <unk> in subjects with inactive chronic hepatitis b and expect to have a data readout in the second half of 2023.

Call that this study is designed to show evidence of antiviral effects against HBV and establish its potential role in combination therapy for the treatment of this important disease.

We had about we are excited about the progress of <unk> and Hep B cell and the upcoming results of these ongoing trials.

With that I will now turn the call over to <unk>, Chief Medical Officer, Dr. Scott Harris to discuss our data and clinical plans.

Seven.

As Vipin noted is 68, 5% relative liver fat reduction was achieved in the one eight milligram dose group at 12 weeks of therapy, which translated into more than half of those subjects, achieving a normal liver fat content of 5% or less.

These promising effects on liver fat content were accompanied at week 12 by significant reductions in serum alanine aminotransferase, a marker of hepatic inflammation.

Reductions of these predominant parameters have predicted a high likelihood of success on biopsy endpoints.

In late trade stage.

Stage clinical trials are conducted Dr.

Dr. Harrison presented new data the greater than 83% of subjects, who received perm to do Todd and <unk> participated in a corrected T. One or Cte one imaging sub study achieved an 80 milliseconds or more reduction in CET, one relaxation times at week 12.

<unk> at each Panther <unk> dose.

<unk> is a measure of fiber inflammatory activity in the liver.

And then elevated CET one score has been correlated with hepatic in cardiovascular events and clinical studies, specifically, an $80 million reduction that's been shown to correlate with a two point improvement in novel <unk> activity score on liver biopsies.

We believe these findings add further to the likelihood of success on biopsy endpoints as well as the likelihood of reduced hepatic in cardiovascular events when outcomes trials are conducted.

Next let me talk about our upcoming readout in our 24 week multicenter trial of subjects with natural D. In mid December and extension to the original 12 week Phase <unk> trial.

The subjects that rolled over have remained double blinded with respect to their assigned treatment of either one to 1824 milligrams of <unk>.

Or placebo.

As we initiated this study well after enrollment in the original 12 week novelty trial had commenced we are pleased with the 70% rollover rate into this trial.

The principal readout will continue to be the safety and Tolerability of Perm do Todd with reduction in liver fat content as the primary efficacy readout.

The readout in December will also include weight loss measures of liver inflammation, including serum ALC.

CET, one relaxation time lipids hemoglobin <unk> C fasting glucose blood pressure and heart rate and adverse events, including adverse events leading to treatment discontinuation.

Sure.

We report consolidated and stratified data on the trial readouts for subjects with and without diabetes.

Now, let me talk about the phase III momentum trial of <unk> in obesity.

The trial was designed to enroll approximately 329, both diabetic subjects with obesity are overweight with at least one comorbidity.

Baseline characteristics of the fully enrolled study population include median body weight and body mass index BMI of approximately 101 kilograms, and 36 kilograms per meter squared respectively.

And median fat content of approximately 5%.

It's measured in approximately 100 subjects participating in the body composition sub study.

The study population is approximately 75% female and approximately 20% of the subjects are of Hispanic ethnicity.

These demographics contrasts sharply with the study population in the 12 week phase <unk> trial, where approximately 80% of subjects were of Hispanic ethnicity, and the median fat content was approximately 22%.

In addition, unlike the phase <unk> trial.

The phase II momentum study.

<unk> employs endpoints and lifestyle interventions that are standard.

For multicenter obesity trials.

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 Dr.

Dr. Lu erosion from Cornell Wildhorn, Yale Medical School, a leading authority in obesity and obesity clinical trials is serving as the principal investigator.

We plan to perform an interim interim analysis to assess changes in body weight. After 24 weeks of treatment when approximately 160 <unk> study participants in the first quarter of 2023.

It is our expectation that our level of weight loss consistent with the class leading obesity drugs may be achieved at the end of 48 weeks of therapy.

We also believe that the tolerability profile of <unk> tied to the absence of dose titration and reduction in serum hepatic lipids.

Could translate into greater ease of administration improved adherence to therapy and greater potential for cardiovascular benefit.

We believe these benefits to differentiate <unk> from other drugs in the obesity space.

We have also completed enrollment in our phase <unk> multicenter trial evaluating glucose control in subjects with type two diabetes over 12 weeks of treatment.

Approximately 48 subjects are planned with readout expected in the first quarter of 2023.

Across the trials that I have described we are rapidly building the safety profile of FEMSA do Todd.

With unblinded safety data in crude and over 200 subjects, receiving one or more doses, a pimp do Todd and clinical trials by year end 2022, and approximately 500 subjects by year end 2023.

We believe that a positive effect on surrogates of cardiovascular outcomes.

<unk> blood pressure serum lipids in the paddock fat content will be demonstrated at final readout.

We are also making continued progress in the enrollment of our phase II multicenter clinical trial of <unk> T cell and subjects with inactive chronic hepatitis b and.

And expect to read out the results of this trial in the second half of 2023.

Recall that the Virologic effects of <unk> T cell are also being a value are being evaluated in a chronically infected patient population to enable the combination of Hep T cell with novel direct acting Antivirals as part of combination therapy for hepatitis B.

I'll now hand, the call over to rich us and start to give an update on our third quarter financial results rich. Thank you Scott and good morning again, everyone.

For today's call I'll be providing a brief update on <unk> third quarter 2020 financial results more comprehensive information will be available in our Form 10-Q to be filed with the SEC later today.

<unk> ended the third quarter of 2022 was approximately $201 $9 million of cash cash equivalents and short term investments compared to $193 million at the end of 2021, we drew down approximately $31 $8 million in net proceeds from our ATM. During the three months ended September 30.

Or even 2022.

Turning to the income statement revenue was minimal in the third quarter of 2022 compared to $200000 in the same period in 2021.

Our change in revenue for the quarter was primarily due to discontinuation of the development activities for our T. Covid at Natus shield programs earlier in 2021.

Research and development expenses were $23 million in the third quarter of 2022 compared to $29 2 million in the same period in 2021.

Ultimately $15 $8 million of this total for the third quarter of 2022 were direct expenses for the conduct of our clinical programs, including $14 million in direct costs related to development activities for <unk> and $1 $8 million in direct costs related to development activity.

R&D expense in the third quarter of 2021 included approximately $15 million of expense to close out the AD Covid campaign.

General and administrative expenses were $4 5 million in the third quarter of 2022 as compared to $4 $2 million from the same period in 2021.

The increase year over year was primarily attributable to increased stock compensation expense.

Net loss for the three months ended September 32022 was $23 5 million or <unk> 48, net loss per share compared to $33 5 million or <unk> 81, net loss per share for the third quarter of 2021 or.

Our existing cash not only funds us through all of our ongoing clinical trials.

We estimate that our assets sufficient to allow us to operate into the second half of 2024.

I will now turn the call back over to <unk> for his closing remarks.

Thank you rich.

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

Thank you if you have a question at this time. Please press star one on your telephone one moment, while we compile the Q&A roster.

Our first question comes from the line of Seamus Fernandez with Guggenheim. Your line is open. Please go ahead.

Great. Thanks, so much for the question so.

Really just wanted to ask if you guys could help us understand.

What the.

The characteristics of the patients.

Of the 70 patients that were in.

We're going to be in the extension 24 week.

A portion of the study.

So.

You have the 12 week data.

In that context and.

Can you provide us a little bit of information with regard to.

If there were any differences in the data.

For those 70 or so patients versus the overall steady.

And if there were any meaningful differences at any of the dose levels in particular I just wanted to get a better understanding of the base characteristics of that patient population as we head into the full 24 week data.

For the Napa <unk> patient population and then the second question.

Just as we kind of advance forward we saw it.

No real change and in fact, some increases in HBA one fee.

In the first 12 week data set in the napp LD patient populations, just trying to get a better sense of how you guys are thinking about the profile of the product if we don't see improvements.

In HBA one C. As patients are treated over time, thanks, so much.

Scott, Yes, Hey, Seamus. Thanks for the question just to clarify there was 70% rollover, but actually the number of subjects was 66.

Don't have that immediate data for you I can tell you that from 10000 feet I think that the rollover study population.

Comparable to what entered the initial original 12 week trial.

But I don't have specifics for you at this time.

Our position has been that there's been no change in the hemoglobin <unk> C.

I think there was a great deal of variation due to small numbers on all in all when we've looked at the individual plots, we haven't seen any change in hemoglobin <unk> C. So it's our position that a 12 weeks. There was no change we will have further information on that when we finish our 12 week committed diabetes study in the first quarter of this year.

<unk> our position has always been that we would not see a change in hemoglobin a one C. At 12 weeks and that we would see changes overtime as insulin sensitivity improved concomitant with improved weight loss and Thats, what we expect to see at future.

<unk> points, but because of the opposing effects of glucagon on.

GOP <unk> activity.

Great and then maybe just a quick follow up question in terms of your expectation if the baseline.

Characteristics of the 66 patients.

Ends up being comparable.

Can you just help us understand what you think is a good result in this patient population.

From a weight loss perspective, particularly given the.

Quite.

Yes.

Stan Lee.

Different.

<unk> characteristics of these patients.

With over 20% liver fat in the Hispanic patient population I'm just wondering what you guys think.

As a particularly good result in that patient population from a weight loss perspective. Thanks.

Not their diabetics their metabolic oil like diabetics and you don't expect them to lose weight and then it's fairly clear that there is a very important impact of Hispanic ethnicity.

<unk> has been shown in various studies and that population has also been reduced and prevalence by a factor of four.

So we look at the <unk> study in this extension is being what it was suited for which was to look at reduction of liver fat.

So we're seeing a reduction in liver weight, it's not a weight loss study and it's not our primary readout in weight loss, we suspect that will continue to see improvements of weight loss, but we have not really gauge what that weight loss has to be to predict what we're going to see them in momentum. We think thats study stands alone.

Okay.

Thank you guys I'll drop back in the queue.

Thank you and one moment for our next question.

Okay.

And our next question comes from the line of Yasmin Rahimi with Piper Sandler. Your line is open. Please go ahead.

Good morning team. Thank you so much for the detail and update to your question for you. This morning, maybe the first one to start off with the.

When you noted that on the 66 patients that we will get 24 week data.

Can you help me understand how many of the patients will be on drug and how many will be on placebo.

And then.

Given that.

Some of the patients who may have not chosen.

Two the extension are there any reasons behind that so that's sort of part one and part two.

Then.

The next question I have for you is I'm very excited for that phase one the diabetes study that youre going to read out in Q2 'twenty three.

Help us understand what do you hope to gain from the 40 patient study do you think it's going to give us really a definitive answer in terms of <unk>.

You may get back so love to hear your color on that.

Three questions.

Right.

Taking our questions.

Yes, Scott Thanks for the question. So let me take them one by one.

Not unblinded the 106 data so I can't tell you, which patients have continued at each dose we have no information on that so I can't give you a snapshot.

The continuation rates at each dose.

Or.

How much of the placebo patients continued versus or the reasons per group of the discontinuation generally the discontinuation reasons were administrative not that the patients discontinued would you have to realize that patients were recruited for 12 week study and regardless of their success many people simply.

He said I don't have the ability to remember theyre getting are coming into the clinic weekly for 12 weeks to come and weekly for an additional 24 weeks at an additional 12 weeks up to 24 weeks would be an undue burden.

And also the study started late so some people just didn't have access to the study soon.

And by and large it was due to non safety reasons or non efficacy reasons that people chose not to continue.

Regarding the phase one study that will read out in the first quarter of the year.

Primary objective of this study is safety. The aim is to show that there is no adverse effects.

<unk> do Todd on blood sugar control.

And Thats been our base case, we need to demonstrate that going forward and accrue more patients to show that the serum glucose and hemoglobin <unk> do not change no additional studies will likely be conducted in the future looking at longer durations of treatment to see the hemoglobin <unk> drops.

But that's beyond the initial 12 weeks that's planned in that phase one study, where the objective of the trial.

Yes, just to just to remind everybody that the 24 week. After a 48 week momentum studies in non diabetic study. So that's why it's important to have that separate studies that we can look at specifically in subjects with diabetes.

Really the reason for that for that study.

Great and then just one quick clarification I appreciate it.

Baseline demographic details that you gave us further momentum.

101 hundred kilogram 36 kilograms BMI in the distribution is that for the total population or is.

Is it 400 patients if you could just clarify that would be helpful and I will jump back into the queue.

It's a great question, yes, when we try to bring it out and I tried to bring it on my opening remarks, but let me repeat it.

For the entire study population.

We don't have specific information for you today on those first 160 or so patients.

That are part of the interim analysis, we're saying in a generic way the population demographics can shift.

Suspect that would differ slightly.

But.

We are announcing the demographics of the population, we're going to make it clear that the.

First 160 or so subjects.

Have exactly these characteristics when they are ready because they vary over the course of the trial.

But it's fair to say that we have any stock difference here between the naphtha depopulation in <unk> study population and Thats really the point that we've been making that we had significantly larger. Hispanic population as you can see that in the numbers.

Difference same thing with the liver fat content and of course, the fund locked up the study itself. This is a more traditional.

<unk> study, which is being conducted at obesity centers the whole the whole feeling about the study is different from a compared to a liver fat reduction study.

Thank you so much for that color very helpful.

Thank you one moment for our next question.

Yes.

And our next question comes from the line of Lisa <unk> with Evercore ISI. Your line is open. Please go ahead.

Reduction or what is the right expectation does that.

Lisa linear expectations for traditional weight loss study.

And we expect the weight loss of momentum to be linear.

This population is very different there is no prior information about how this study population.

We'll we'll react.

We will lose weight the combination of the highest spandex, the very highest Fedex and probably the highest liver fat content. That's been studied to date in trials.

We just don't know what the weight losses, we know it is going to increase.

We're not making any projections about the linearity because we think the study is so different from momentum trial adverse no relevance to predicting the results of momentum.

Okay.

And then for.

Yes.

The momentum.

Obesity study what should we expect.

The effects of.

Diet and exercise of lifestyle changes to be at 24 weeks like what kind of an impact would you expect that to have is that like a couple percentage points Sir.

Yes, so im looking across other trials like the <unk> trials and the surmount trials and typically the weight loss peaks at about 2% around week 12, and then maintains itself over the course of the trial or out to say 24 weeks.

Okay.

And then for the diabetes study that the 12 week safety study.

Well. This should we think of this is kind of a weight loss study or how should we be thinking about.

Kind of.

What.

What sort of read through to take from.

From from this study in terms of the efficacy component.

Well once again like the novel <unk> trial that we just talked about the diabetes study is not being conducted as a weight loss trial.

Okay.

I think thats it for me for now thank you.

Thank you and one moment for our next question.

And our next question comes from the line of Matt <unk> with B Riley. Your line is open. Please go ahead.

Good morning, Dean Thanks for taking my question and congrats on the progress with the ongoing plans. So maybe just a clarifying question for you.

All comments about the.

Momentum.

Data expectations and when you see.

Lastly, just to clarify you mean glucagon directed therapies.

And then broadly.

As you know for the latter.

Even for six months.

<unk>.

Maybe getting elevated.

Hi.

Some of the emerging data side.

Wanted to clarify.

What sort of your landscape.

Molecule looked like that when you think about weight loss from momentum.

Yes, that's a good question Manny.

Well look if you look at the progression of weight loss. The first wave of <unk> had about 15% now we are approaching 20%. So really it's that ballpark we are talking about.

Ultimately, we believe that there is going to be multiple products approved in this space and weight loss is going to be important but not the only component of overall value proposition.

Multiple drugs will be approved for marketing and then depending upon what is the overall profile of the safety Tolerability ease of administration.

Lipid profiles are going to be very important ultimately.

It's all about cardio cardio metabolic health that we're trying to improve here.

So that's what we mean is that going.

I have to be that in that ballpark of the leading drugs in terms of weight loss, but then when you look at all of the other characteristics. We think there'll be multiple drugs that would that would find a place it's a very heterogeneous.

Patient population and physicians doctors are going to need multiple options to treat these these.

These subjects.

Scott.

Did you want to.

Jumping.

I think there's been some recent information on a compound that came out from Amgen where.

<unk> data was presented and very impressive weight loss and you might be referring to that is now being in the mix.

And we took note of that and we congratulate them on the excellent results and shows the drugs can really have weight losses that are starting to approach bariatric surgery. We are happy to be in that group of drugs. So that we think can achieve that we'd want to stress with drugs that it's a new mechanism of action and approach that hasnt been sufficiently explored.

We know about the <unk>.

<unk> antibody combination.

While we know about the <unk> and VIP, specifically that they do not have meaningful effects on serum lipids.

And they don't have meaningful effects on hepatic lipids, and therefore, they're going to be coming up with less than a full.

<unk> approach to cardiovascular outcomes reductions because of the absence of that effect in the relying mainly on weight loss.

So we think that's still a problem with those drugs.

And finally, not only don't we know about long term efficacy you're seeing a snapshot of results at a limited time point in the 12 week range.

But with the new mechanism of action the long term safety is not known.

Late them and the results we're happy to be in the mix for long term weight loss and we're glad to see the bar going up and up but theres a lot more of that has to be known about the mechanism of action, particularly on the safety side.

Thank you that's very helpful and I think more in a month's time from both you and Amgen and then just a couple of quick questions on the naphthalene diabetes study. So is it is it.

And beyond that.

Most of the crossover patients in the 68 patients will be dynamically the plasma supply mode, which means you may not have many in placebo and.

I'm just curious what that May mean for kinetics of liver fat and dividend should be focus on placebo adjusted numbers for that 24 week readout.

Yes.

I wish I could answer the question, but because were blinded I just don't have that data right.

And in terms of the kinetics once again.

Let me emphasize that this study was conducted.

To look at reductions to liver fat and I want to highlight the fact that the reductions in liver fat were excellent.

We're just excellent.

And it was accompanied by many markers of good outcomes like the reduction of <unk> and the reduction of CET one.

Times, an MRI scanning.

And observed weight loss, we are happy with the weight loss that we saw in the first trial that was commensurate with <unk> on the placebo adjusted basis. So we're very happy with that but we're trying to emphasize to be closer to the great differences in the populations and the very nature of the way that the study was conducted.

With there being no branding or no emphasis on weight loss no communication on weight loss really.

Two patients even investigators in the study that the kinetics of weight loss in this population of the kinetics of weight loss and the population. They don't translate to the kinetics that we're going to see in dedicated obesity trials with patients dedicated obesity patients with one quarter of the amount of liver fat in one quarter the amount of Hispanics.

Got it I would just add that in terms of liver fat reduction further improvement in that as you as you know that we've already gotten such a significant liver fat reduction <unk> improvement that going from 12 to 24 week you might improve some but we've already reached such a.

The liver fat reduction of costs relatively quickly anyway. So so just just to be sure.

We have already achieved significant liver fat reduction and justify two hour weeks.

Thanks, Thank you and one for rich quickly does the cash runway guidance include any.

The integration, you're starting phase III Nash biopsy study.

Suddenly next year.

This gratified that and thanks again for the Q&A session.

Yes.

<unk>.

The expectation is we'll be spending money to get ready for phase III.

<unk>.

And a piece of the <unk> for Nash. So we clearly don't have the cash.

And complete a full phase III campaign.

For obesity.

We haven't really necessarily designated which dollar undergoing which direction, but we can get started in either private equity syndications.

Yes, our goal is to be both phase II ready for Nash.

And phase III ready for obesity, the timelines will be different that we're already working on putting together those plans in place.

Nash, we should be ready for phase II by the second quarter of next year. So we can execute that trial, if we decided to do so and for obesity will not debate for the 48 week data and we'll be ready for that the execution of that phase III in the first half of 2024, yes, just to be specific timeline, we would not stop.

The Nash trial, R&D Nash trial before we see the interim readout.

Easily.

Okay. Thanks for clarifying that.

Thank you and one moment for our next question.

Our next question comes from the line of John Wilman with JMP Securities. Your line is open. Please go ahead.

Hey, thanks for taking the questions.

A couple for me.

You previously commented that the blinded weight loss per momentum was tracking in line with the first phase. One study. So I was wondering if you could update us on how thats looking over time and then secondly on the diabetes study Scott you mentioned the key here is to be on HCI share of glucose just wondering if there is any.

More specifics of bars on.

Worsening levels that are acceptable or if any change.

A clear negative here, just hoping for a little more specifics there. Thanks.

Yes.

So regarding your first question, Jonathan we took a single snapshot of the data at one time point that was comparable to the time points in the novelty trial.

I'm talking about the amendment on snapshot and the 101 excuse me. The first in human study that was done in Australia, we have not been following blinded weight loss curves over time, so I can't communicate that data to you we don't have that data.

Regarding the hemoglobin <unk> C and the glucose.

<unk>.

Diabetes study that will read out in the first quarter, yes, it's a safety study.

Our base position has always been there.

It will not be any changes, we don't expect any worsening.

And.

That continues to be our position that we will see maintenance of glucose control in these patients.

That's helpful. Thank you.

Thank you and one moment for our next question.

And our next question comes from the line of Patrick <unk> with H C. Wainwright. Your line is open. Please go ahead.

Hi, This is Matthew <unk> on O&M on for Patrick today.

My first question is going to be.

Regarding the potential for <unk> in Nash and can you discuss how it compares to others in the field and where would you envision it situated in the emerging treatment paradigm.

Well, thank you Matthew.

<unk>.

The data that we have we think compares.

To every any drug.

The best liver fat reduction has been seen up till now with the flux of firm and we think that our data is at least comparable to that in better in some ways.

So there is a strong literature that.

With.

The same if not better levels of liver fat reduction probably achieved in a shorter period of time.

That we will see comparable effects.

In a.

Late Phase Nash trial, and we've received comments from Kols like Stephen Harrison.

Markers that have appeared to be very predictive of success in biopsies.

But going if you would allow me outside of the exact.

The field of Nash.

Cardiologists are now looking at CET, one data inflammatory activity in the liver to predict inflammatory activity in.

Coronary and cerebral vascular plaques.

And they've also draw an inference from reductions of CET, one is improving cardiovascular outcomes.

I think that our positioning in Nash is really excellent.

And not only do we have comparable levels of liver fat data in at least as good reductions in fibro inflammatory activity.

And our current trials, but we have one thing that the other compounds in Nash with similar levels of fat reduction don't have which is meaningful weight loss.

Loss with the flux affirming.

I believe it was <unk>.

24 weeks was.

<unk> two 6%.

We're seeing about double that in about one half the time.

You know what gets these people in Nash into trouble is they are being overweight and the principal morbidities of Nash.

Or not necessarily deliver effects, but the cardiovascular spec effects, especially in the early phases of the disease and weight loss is very meaningful for these people.

Perfect. Thank you I appreciate that.

The next one I had is a it's a follow up question on the safety and Tolerability profile of <unk>.

Particularly the discontinuation rates that <unk> seen so far and then how does that compare to others in the field and then can you discuss what the dropout rate has been or is expected to be in the momentum program.

Great.

I can quote you the discontinuation rates on our first in human trial for adverse events, which were zero percent.

And the naphtha <unk> trial. It was zero percent of one two milligrams about 4% at one eight milligrams in about 4% a two four milligrams.

About half of what you would see in other trials.

If you look at the momentum trial and of course, we won't know the dropout rate in that trial until the trial is completed but typically in obesity trials, we've seen very very high dropout rates, but with improvements in the way. The Charles have conducted we've seen dropout rates of about 20% in the more recent trials.

I cannot tell you that that will be the dropout rate and the momentum by the time of 48 weeks is concluded but.

Those are the range. That's the range has been seen in other trials that have preceded us.

Great. Thank you and then I have one more following the.

As LD I'm wondering if a preference is emerging for all team in terms of which antiviral mechanism you would prefer to combine with the Hep T cell program.

Okay.

Hey, Matthew this is Scott Roberts.

I think theres, a number of options out there, but in general I think that the approaches whether their algo based or RNA base that that knockdown of surface antigen.

And begin to.

<unk> released the immune suppression that is characteristic of chronic hepatitis b those probably make the most sense you can imagine a scenario where those types of agents are used first surface antigen. This decrease that T cell responses are beginning to wake up and respond and then we come in with a hefty sell it and help boost those response.

As against the.

The antigens that are being expressed in hepatocytes. So I think there's probably a number of ways to look at that and there is some scheduling issues that have to be looked at but conceptually I think thats, probably the most straightforward approach.

Perfect. Thank you I appreciate it.

Thank you and I'm showing no further questions at this time I'd like to turn the conference back over to Tim Guard for any further remarks.

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

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

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