Nektar Therapeutics Q1 2023 Earnings Call
Good day and thank you for standing by welcome to the nectar Therapeutics first quarter 20, twenty-three financial results conference call.
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I would not like to hand, the conference over to your speaker today Vivienne will please go ahead.
Thank you Chrystal and good afternoon, everyone. Thank you for joining us today with us on the call or Howard Robin our President's <unk>, Dr. Jonathan's Levski, our chief of research and development, Dr. Mary Tyler very our Chief Medical Officer, and Sandra Gardner or acting Chief Financial Officer.
On today's call, we expect to make forward looking statements regarding your business, including statements regarding the therapeutic potential of N feature development plans for drug candidates and research programs. The timing of the initiation of clinical studies and the availability of clinical data for a drug candidates the timing and plans for future clinical data presentations information.
Future development plans or success of our collaboration arrangements.
The expectations falling or corporate restructuring and reorganization financial guidance and certain other statements regarding feature for business.
Cause forward looking statements relate to the future of their subject.
<unk> risks there are difficult to predict and many of which are outside of our control.
Actual results may differ materially in these from these statements.
Important risks and uncertainties are set forth in her Form 10-K that was filed on February 28th 2023, which is available at a SEC dot Gov.
We undertake no obligation to update any of these forward looking statements whether as a result of new information future developments or otherwise webcast of this call will be available on the ire page of next year's website <unk> Dot com.
With that said I would like to hand, the call over to our president and CEO How're Robyn Howard.
Thank you Vivienne and thank you all for joining us today.
You know a few weeks ago, it announced our plans to implement a new strategic plan and cost restructuring of liquor and I'm pleased to report today that we enacted the plan quickly and that we will begin to see ongoing expense savings starting in the third quarter of this year.
The new plan focuses our company more clearly.
And importantly, also extends our cash runway gripped least the middle of 2026.
A core element of our new pipeline focus and plan is on the advancement of roast pig and we intend to move quickly to initiate it willpower randomized phase to be studying for rose peg in patients with a topic dermatitis.
We were incredibly pleased to have regained the rights to this first in class regulatory to sell program from Louie Importantly, there are no royalties owed to Willie for this transfer and <unk> now becomes a wholly owned asset of knickers.
The topic dermatitis as a target indication of a <unk> is attractive to us for several reasons not the least of which is the strength of the data that has been generated for <unk> in patients with a topic during the titles.
The non topical biologic treatments landscape is significant and growing the approvals of Dupixent and other IL 13 based biologics have driven this growth in the U S alone approximately 16 million people were living with atopic dermatitis with three out of four of these affected by moderate to severe disease.
In 2021 biologic sales for atopic dermatitis, we're close to $5 billion in sales continue to grow.
Being said the topic dermatitis is a disease area, where there is still a very high unmet need for novel biologic treatment options.
Most notably the.
The mechanisms available to patients today after they failed topical treatments overlap and fall into either the category of IL 13, based mechanisms where Jack inhibitors.
Both mechanisms have limitations on efficacy and both have some notable safety challenges, which include black box warnings with the Jack inhibitor class.
Even with the growth and the adoption of these mechanisms at least 50% of patients don't respond to these therapies at all and many patients C. A rebound in their disease after coming off these therapies. This.
This opens a real opportunity for <unk> to be introduced as the first regulatory T cell mechanism that is differentiated from these overlapping existing mechanism.
The phase one b data for <unk> was compelling and set the stage for us to measure the potential for Reza beg to be a religious therapy with longer term disease control and less frequent maintenance dosage J.
<unk> will review the data reported for Red Big in a few minutes, including the quality and durability of responses we saw in patients.
Now as we mentioned in our Reprioritization plan with a focus on immunology will also continue the development of our I'll 15 program <unk> 255, and cancer, while we explore strategic partnership options and.
<unk> 255 is being developed in combination with cell therapies, and we believe it could be a valuable adjuvant therapy for companies focused in the area of cell therapy or.
Phase two study of <unk> 255 in combination with approved cell therapies, <unk> Carter as well as the phase two javelin bladder mentally study with Merck K G. A will continue while we seek a development partner.
We continue to see great value, an extra 255 and early data showed its promise as a potentiate or of cell therapies that could benefit patients suffering from very difficult to treat cancers. Our goal is to find the strategic co development partner this year.
As I stated earlier, our primary focus is on immunology and to that end, we have two preclinical candidates advancing.
TNF are two antibody program and a peg CFS, one program, which J Z will discuss in a moment.
Goal is to have an IMD ready in 2024 for at least one of these programs.
We are deeply grateful to our employees for their commitment and dedication to nectar and the patients. We aim to serve the decisions over the past month to further reduce our head count had been difficult, but we believe these are the right decisions to maximize the success of Red bag and our immunology programs. We're confident that our focus on immunology has the best fast forward.
To bring important potential therapies to patients integrate value for our shareholders and now I'll pass the call to Jay Z to review the programs in more detail.
Thanks Howard.
Starting with.
This is a unique molecule that has shown promising efficacy in multiple clinical trials as a single agent.
Our goal with this program is to address the underlying teabag deficiencies and consequent over activity of a factor T cells and these diseases.
Selectively activating an expanding tears.
Red Tag is uniquely positioned as the most advanced.
Based teabag mechanism and equipment.
With opportunity and potential and a number of auto immune disease indications.
Now Howard touched on one of these indications atopic dermatitis.
Management of a topic dermatitis has a few main goals.
First goal is the rabbit efficacious treatment of the acute phase of the plan and.
And second is that the <unk>.
<unk> March allergy in control of the chronic disease in the long term.
And given that most patients with moderate to severe disease medications for many years.
Safety profile is also critically important.
The current treatment landscape for patients with moderate to severe disease that require systemic therapy has two major classes of medicine currently approved standard of care.
One class of the target key cytokines that drive the th two inflammation pathway.
The flagship in this class dupixent, according to <unk>, which blocks the aisle for an aisle 13 pathways.
<unk>, which is expecting approval later this year and the recently approved Atteberry, both target and block 13 only.
While dupixent as a very successful drug there is now a real world data that describe some of its limitations.
Real World evidence study showed the lack of durable efficacy and.
And that 79% of patients that discontinued Dupixent lost disease control after an average of four months and needed to restart therapy.
Another railroads study showed that 27% of patients taking dupixent developed moderate to severe conjunctivitis, requiring treatment with anti inflammatory eyedrops or appointments.
The other major classes therapy for a topic dermatitis or the Jack inhibitors.
Interfere with T cell activation and Thats suppressed inflammation and determined.
Jack inhibitors show impressive efficacy get any topic Durbin tightened the.
But they carry multiple black box warnings, making them less attractive from chronic use.
The Jack inhibitors are associated with the multiple safety risks. The FDA has only granted a label jacking editors in patients whose disease does not adequately controlled with other systemic drug products, including biologics.
And the clinic because of the black box warnings dermatologist acknowledge the Jack inhibitors are not citizens from any of their patients, including individuals greater than 65 years old.
Those with the Comorbidities associated with the Black box Ward.
Like to picks it patients that discontinued Jack inhibitors also quickly lose disease control and relax.
Unlike I'll 13, blockers, and Jack inhibitors, which both blocked their respective pathways.
<unk> is designed to target the <unk> receptor complex and stimulate the expansion and function of <unk>.
These in turn suppressed the harmful T cells that are driving the underlying pathology of a topic Durbin Titus.
<unk> aims to restore homeostasis in the immune system through the proliferation of <unk> cells, rather than just blocking effect yourselves.
And consequently, ratbag provides a completely different mechanism of action compared to the other drugs that are currently approved or under development and the topic dermatitis space.
The phase one data from our first initial proof of concept study and moderate to severe atopic dermatitis reinforces our conviction and <unk>.
The 12 week Phase <unk> study conducted by Lily.
Two doses of ratbag compared to placebo and then followed patients for 36 additional leagues after the last dose of therapy.
Last September we presented the interim data from this trial.
<unk> demonstrated the dose dependent reduction and eczema area and severity index scores in patients often under the easy score with approximately a 70% reduction in scores at week 12 at the highest dose tested.
We also saw dose dependent improvement in the investigated a global assessment for a topic dermatitis, an inch responder rates through week 12 of treatment.
Consistent with the <unk> mechanism of action total T rags, and Stephen twenty-five bright teabags increase versus placebo through a week 12.
You can see observed at 12 weeks of treatment with breastfed is in line with efficacy observed after 16 weeks of treatment with to fix it.
But clearly the most fascinating observation from this study was that when we looked at patients 36 weeks. After we stop dosing ratbag their skin scores and other measurements of disease activity remained very low.
This is in the fact that is not observed with dupixent.
This has us and kols very enthusiastic about the potential for long lasting responses and infrequent Macy's maintenance dosing with <unk> in the setting of atopic dermatitis.
We have now received the final data for this study from Eli Lilly and the study results positively extend the interim results previously reported.
In addition, these data include additional efficacy endpoints that were non covered in last year's.
Presentation.
To briefly touch on some of these.
We observed dose dependent decrease in the percentage of body surface area involvement that atopic dermatitis also known as BSA.
And patients treated with <unk>.
With patients at the highest dose level, reaching a 72% reduction in BSA at week 12.
As a reminder, BSA continuous measurement that correlates with music.
We also observe dose dependent reductions in too patient recorded outcome measures. The dermatology life quality index also known as D. L E Y and the patient oriented eczema measure or poems.
In addition, the final dataset has data from more patients completing the 36 week observation period.
We're very excited about the data obtained in this study.
<unk> showed efficacy across all measures a physician reported disease activity and patient reported outcomes.
These effects were durable and maintain after patients stopped rats Peg administration that week 12.
I look forward to.
I think in the coming months.
When we developed rashes Tergat nectar, our hypothesis was there restoring T rag populations in patients with auto immune disease would restore the normal balance of the immune system and potential they provide a disease modifying therapy.
We are excited to see the long duration of sustained response observed omit how big carbohydrate study consistent with that hypothesis.
These collected data demonstrate <unk> potential as a primitive therapy.
Support that quick advancement of Red tag to move into a state to be study and atopic dermatitis later this year.
We are now finalising the faith to be study, which will be an industry standard phase. Two study designed similarly to phase two were conducted for approved Iowa 13, and other agents.
This will allow us to evaluate multiple dose regiments of <unk> and the 16 week induction period.
Followed by 28 week maintenance period.
We believe the study design will enable data to be better compared to prior phase two studies that a 16 week primary endpoint and read out at the end of the induction period.
We have a double a scientific steering committee for this trial and we are pleased to announce that Dr. Jonathan Silverberg from the George Washington University School of Medicine, and Health Sciences will be the chair of this committee.
We are truly excited for <unk> potential at the first in class T. Rex Stimulator, and we look forward to initiating this phase to be study in patients with moderate to severe atopic dermatitis. This year.
The phase two top line data reported and lupus earlier. This year also demonstrated clinically meaningful improvement as compared to placebo across key secondary endpoints, including Bitcoin L. L. D. A S at the mid dose level.
Since we reported the data we have had time to meet with many salt leaders in the field of lupus.
Their reaction to our study results has been positive and provided us with many insights.
And their feedback the thought leaders focused on red tagged rapid onset of <unk> and <unk>.
As well as the magnitude of the effect on these endpoints that was absurd.
There is agreement that the faith to be data provide ample evidence to design a phase III Registrational study around these approvable endpoints.
While we remain very interested in lupus.
Be clear we are prioritizing first phase two visa that you get any topic dermatitis.
Because it will allow us to rapidly reached a definitive results in a randomized study.
We may have the opportunity to revisit a development strategy lupus once we get the results from this atopic dermatitis study.
We are extremely excited about <unk> now being a wholly owned component of our pipeline.
While our near term focus is on a topic dermatitis. We continue to believe that <unk> is broad potential in multiple indications.
As development of this program Progressive we will continue to evaluate further opportunities and indications for <unk>.
Moving connector 255.
We are evaluating strategic partnership options for the App that while we continue our netra sponsored phase two study of nectar 255 in combination with cell therapy.
The phase two javelin bladder medley study with our partner Mark Kgs.
<unk> 255 is an agent that engages a full biology of the aisle 15 pathway to provide functional activation and homeostatic control of IL 15 responses are immune cells may.
Mainly natural killer, So C D T cells in the immune memory subset.
As a full agonists there'll be I owe 15 pathway. It can signal through both scythe and trans presentation of the <unk> receptor complex.
Next 1255 can be combined with multiple mechanisms ranging from targeted therapy, the cell therapies, including parties and even TCR therapies in checkpoint inhibitors to potentially improve the efficacy of these agents.
While we continue to see great value in this program with an extra 255, showing broad potential applicability across oncology indications.
We believe prioritizing are immunology programs provides a great opportunity to create value for our shareholders.
We believe further development of next to 255 with the strategic partners. Therefore, the best path forward for our program.
Our goal is to find a partner this year.
With this reprioritization, an extra 255 studies in combination, but darzalex bass pro in multiple myeloma.
And the combination was to talk to some advil solid tumors are wrapping up as we prioritize the cell therapy and bladder cancer sites.
Now turning to our preclinical research program.
We are advancing our research pipeline with a focus on auto immune disease.
First program. We are working on is our new Peg colony stimulating factor also noted CSS one program.
Peg CSF, one is the polyethylene glycol or peg modified version of the CSF one protein.
This molecule was engineered to optimize the receptor interaction and the exposure to selectively modulate the resolution processes of inflammation.
We believe this program is applications and a number of therapeutic indications, including acute and chronic inflammation as well as fibrosis and we are excited to be ramping up the program.
Our second preclinical program is our 10 F. R. Two agonist antibody being developed in collaboration with biologic design.
Tanner hard too is highly expressed on teabags neuronal cells and endothelial cells and TNF are two agonism has been shown to potentiate, the suppressive effect and overall functional properties of T. Rex.
Absence.
It's associated with CMS auto immunity.
<unk> presence has been associated with protective effects with normal cells as well as other cell populations and tissues in the body.
The lead antibodies, we have identified showed selected T Rex binding and signalling which enables them to be developed specifically for auto immune disease.
We are very excited about this program and its potential to suppress inflammation and promote immune resolution.
We plan to file an int for at least one of these programs in 2024 and look forward to keeping you updated on our progress as these programs mature.
And with that I will turn the call over to Sandy for review of our cost restructuring plan and financial guidance.
[noise], Thank you and good afternoon, everyone.
Like to first outline the actions they are taking.
Currently in the second quarter as part.
Part of our cost restructuring plan.
[noise] expensive.
Will provide.
23 financial guidance, we ended the first Florida with approximately $457 million in cash and investments with no debt on our balance sheet.
As we announced in April we have reduced our San Francisco based workforce.
Emily 60%.
Costs related to the restructuring will be paid by the end of June in the second quarter we.
We now have approximately 55 employees based in San Francisco going forward.
An annual run rate basis reduction to personnel represents approximately $30 million a year in operating expense reductions.
We will have quarterly savings beginning in the third corner at 2023, and we expect to fully realize these annual savings in 2024.
With these reductions in annual operating expenses is Howard stayed in our plan allows for next year. He didn't have any cash runway two or at least the middle of 2026.
Visiting cash on hand.
Any cash brought in from partnering or other strategic activities with further extend this runway and bolster the balance sheet.
Before I move on to 2023 financial guidance I will note a few non-cash items that were recorded during the first corner at 2023.
First we recorded a one time non-cash charge of $76.5 million to impair the goodwill that was previously recorded on our balance sheet, primarily from two acquisitions made over 17 years ago that 2001 acquisition of Shearwater Corporation and that too.
1005 acquisition of Aragon.
In queue line. We also recorded a 13.2 million dollar non-cash impairment primarily for at least assets.
These aggregates non-cash impairment charges at $89.7 million contributed 48 cents to our net loss per share in Q1 2023.
Excluding these non-cash impairment charges net loss on a non-GAAP basis for the first quarter of 2023 at least $47.3 million or 25 cents basic and diluted loss per share.
I'll know review or 2023 financial guidance we.
We expect to end 2000, twenty-three with at least $315 million in cash and investments and.
In the second quarter of 2023, we will have non-recurring cash payments of approximately $8 million in connection with a reduction in head count.
We expect our net cash usage to decrease in the second half of the year. After these payments are made in June .
As I said earlier this reduction in net cash utilization extends aren't cash runway for at least the middle of 2026.
Our gas revenue for full year 2023 is expected to be between 80 and $90 million.
This revenue include 65 million to $70 million in non-cash royalties and 15 million to 20 million and product sales.
We anticipate full year 2023 gap R&D operating expenses will range between $105 million.
15 million, which includes approximately 15 to 20 million of non-cash depreciation and stock compensation expense.
We expect G&A operating expense for full year 2023 to be between $75 million and 80 million, which includes approximately 15 million to 20 million of non-cash depreciation and stock compensation expense.
For the full year 2023, we expect to recognize restructuring impairment and costs are terminated programs.
Suddenly $30 million to $35 million $13.2 million, which is a non-cash impairment that I mentioned earlier and was recognized in Q1 2023.
Our full year 2000, twenty-three non-cash interest expense is expected to be between $20 million and $25 million.
And with that will now open the call for questions operator.
Thank you as a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one one again.
Please stand by we compile the Q&A roster.
And our first question will come from Chris Shabby Connie from Goldman Sachs. Your line is open.
Hi, Good afternoon, everyone. This is truly after Chris. Thank you so much for taking our questions I understand the excitement for heavy <unk> back in house, but just wondering as we're thinking about the restructuring efforts going forward are you open to the opportunity to potentially partnering branch peg with another farm a partner at some point or are you happy to keep it in house at this point and then I have a quick follow up.
Yeah. Good. This is Howard good question at this point I have I have no plans to partner with anybody else. This is next year's program I think it's a great opportunity for us to see this through to completion.
Do see from the data that we should be able to complete a fees to be trial and atopic dermatitis with success and it will be the first mechanism of its kind in sept, I think set the stage for a new way to treat autoimmune disease. So for now it's our drug.
That answers [laughter] yeah.
Yeah, No. That's very helpful. Thank you and then just quickly if we think about the the timeline for the faced UPN atopic dermatitis. Those kind of played out just now should we be expecting those data to maybe be like a mid 2024 sort of timeline.
Yeah look what we're gonna look we're going to start that study as soon as we can it's gonna take a few more months to finalise to finalize the design. It gets it gets site setup I would say that you're looking at somewhere in the range of 14 to 18 months to complete that study from the time. We start. So you know as soon as we started will give everybody a more a more thorough update.
Okay, great. Thank you so much for taking our questions.
Thank you.
Our next question comes from Jerry Gong from the Zillow. Your line is open.
Hi, This is Jerry gone gone from there Goldstein I've taken a question just two quick ones from us.
For the face GB studying topic term are you pregnant conducting definitely some analyses for different patients will be made a part of it fixed and Jack either.
And one could put an extra 255.
Can.
Can you give any color on the type of.
Partnership next time, I look for like whatever like type of deal will be interesting.
Well, Okay I'll, let let me take the second half first and then I'll just keep it over to J Z for to answer your first part of your question I think.
Look we're focused right now I think where we need to focus we need to make sure our cash runway runs through at least the middle of 26 and I'm comfortable that we can do that and that means we're gonna focus right now when atopic dermatitis, because it's an enormous market certainly certainly much larger than the cell therapy market and I do think that that's where we need to focus on.
I think roseburg has not just the potential to to treat a topic term otitis, but if we're successful there.
Potential for that type of mechanism and various auto immune disorders is kind of exciting.
I do think for next to 250 for an extra 255 I can't tell you what that will look like yet obviously it'll be it'll be in combination with a cell therapy, whereas whereas obviously, what we're doing with rose peg is.
Active as a single agent. So we have to explore carefully what that deal with look like I think it could be a joined it could be a joint collaboration it could be a license deal don't know yet certainly all the cell therapy companies are talking to us because I do believe they feel that I owe 15 is going to be important and potentially aiding cell therapies. So lots of it.
Discussion lots of potential it could be a collaboration can be a license don't know yet.
Okay and pay Jerry this is Ah Jay Z. So in response to your first question.
The study design is being finalized down where you still have to wait for the feedback that we get from the health authorities, but I can give you a little bit of color.
We're planning to enroll approximately 280 patients.
We will have multiple dose regimens there will evaluate the induction phase and then in the maintenance phase will also be looking at very infrequent dosing regimen.
And the purpose of this design is really to springboard from the things that we've learned in the phase one study.
So there we saw that that strong and long durability of effect, which we believe in the maintenance arm can allow us to access very very low frequency dosing, which would be highly differentiating I guess all of the other agents in the class that require either a twice monthly or monthly kind of a dosing regimen.
And as we get closer to.
Two later this year closer to kicking off the study we will give another update.
Unveil the design of the study.
Some of the key points that were measuring and all of the additional features so.
Stay tuned for that it'll be coming up soon.
Super helpful. Thanks for the the answers.
Thank you.
Our next question will come from Jessica <unk> from J P. Morgan Your line is open.
Hey, good afternoon visit jail for just so a couple of questions from us first.
<unk> for for you always kind of strategic decision to partner on 222255, just wondering if this is something new.
After you regain the full right of <unk> or was it always on the table for four.
4255, and then on your cash runway if any extra color that you quick kind of conceptualizing for US for example, does your current cash wrongly to at least 2026 tons of budget in.
Completed in the full two v's thought that <unk>, that's Pak and does it also kind of budget in.
You're.
255 study right without therapy too I believe that's currently active and I. Thank you.
You kind of just announced some new programs, just now and how much cash run by a half your budget. These sports those preclinical studies and some of them can move into the clinic. Thank you very much.
Okay. Good very good questions look [laughter].
You know we were like when when we've been working on.
As an immuno oncology company and and Immunology Company of course, 255 was an important component of our our portfolio and I still think Mister 255, I owe 15 has an important role in immuno oncology.
Said, you know we need to focus and we need to focus where the opportunities are largest and the opportunities.
To have a novel mechanism are are available to us and that's <unk>. So we keep working on 255, yes, but I do want I do think we just changed our mind at this point.
Over the past few years and I've decided that.
A company, we would like to find a strategic partner for an extra 255.
And that's that's to allow us to fully exploit our skills and immunology now to the second part of your question our cash runway through at least 26 includes the full cost of a to be study in atopic dermatitis that full cost as in there it's approximately $60 million so that is.
Fully accounted for in there as as is the cost of continuing the an extra 255 studies to gain a partnership as well as as well as the I N D filing for those two programs. So that's all in the cash one way through two.
2026, if we if we do any other deals or any other opportunities in there that will just add a Sandra said earlier that will just add to the.
Length of our <unk> length of our <unk>.
Cash runway hope that answers.
Thank you.
And our next question will come from Greg Harrison from Bank of America. Your line is open.
Hi, there. This is Mary Jones, Okay. Thank you so much for taking our questions I guess.
In terms of the Reds Peg program, how our discussions going with regulators regarding the development take any topic dermatitis, maybe just looking at the program as a whole hear what other indications beyond a D. N. S. Do you think would benefit from this treatment. Thank you.
Okay. Those are good questions I will I will turn that over to J Z to give you a good answer.
Yeah. Thanks, how are.
Yes. Thank you further question. So so the agency of course.
Has seen the you know the the totality of all of the studies that have been.
Put forward, so far and that includes.
The phase one study in atopic dermatitis or of course.
Back on the protocol multiple discussions with the F D a.
Eddie.
In terms of the face to be 30, as I mentioned earlier silver Finalising that study protocol b.
Be seeking health authority feedback on that protocol very very soon.
So that will get the additional kind of information that will allow us to finalize the protocol to start to study later this year.
In terms of the scope of indications.
You know so far <unk> has been evaluated and and a number of indications there was activity that we're seeing in a coffin dermatitis is being discussed there was activity in a phase one being study in psoriasis.
When it's clinical activity and Lucas.
An alternative colitis.
The study was stopped early but not efficacious than that indication.
But one of the things that gives us insight in is a range of different kinds of immunological settings, where we know T. Rags are important and we know that either T Rex dysfunction or the absence of a teabag compartment controlling conventional or affect your T cells.
So there are a range of additional indications that we're thinking about there's a number in the th two spectrum of diseases. Obviously atopic dermatitis is a copy of the skin. There are multiple other a topic conditions of other organs that are definitely something that we're thinking a lot about.
There are some neuropharmacology diseases that we think about it as well.
And others and so there's definitely a very wide spectrum, both biologically and with this novel mechanism to consider multiple indications.
<unk> reiterated on the call and is Howard just mentioned focus is critically important so besides focusing on our immunology pipelines were prioritizing are paid to be studying atopic dermatitis.
But as we move.
Move forward that study and as theirs data from that study we expected the future will be expanding the program as well.
Great. Thank you so much.
Thank you and.
And as a reminder to ask a question. Please press star one one.
And our next question will come from Dana Gray bus from SBB Securities. Your line is open.
Hi, Thank you for that question I'd like to understand how you're thinking about the therapeutic window for <unk>.
Specifically in the Lucas study you also had a dose response and Colorability, our safety and the highest dose I think as close to the dose where you saw the greatest he ragged increases and efficacy and a T D and seem pretty intolerable under your bed. So how're you navigating that in your face.
<unk>. Thank you.
Well I'll turn that over to J Z for a more thorough.
Explanation, but but the effects of these are a T. Reg mechanism and is somewhat different in different diseases and J C. Do you want to comment further on that.
Yeah. Thanks, Dana further question you know, we've seen with with even low docile too.
Are you familiar with the literature that across different disease indications low docile too has a different kind of performance and there's different kinds of sensitivity of the underlying immune dysfunction and how low docile two words.
One of the things that I that.
We learned from the study in lupus patients right is that the high dose, which we've studied before in multiple settings from healthy volunteers to patients with mild lupus patients with psoriasis patients with a topic dermatitis in patients with ulcerative colitis.
We really didn't see systemic toxicity issues with that dose level and those other patient populations, but in the moderate to severe lupus patients, we saw more and tolerability and that's <unk>.
So what are the hypothesis that we have is really related to the nature of the disease and the lupus patients who have much more of a systemic th one disease.
Whereas in atopic dermatitis, it's different it's the th to kind of a disease. So even though the same dose level was studied in both patient populations. We definitely saw very different profiles, both in terms of efficacy at that dose level as well as tolerability.
The things that gives us comfort moving forward and that new topics dermatitis space D. Study is that we've already studied that same dose level 24 micrograms per kilogram into phase one b, which is essentially analogous to the 1800 microgram flat dose.
We've already studied that dose level in the phase one study and looking at the efficacy profile relative to the Tolerability profile alright, it looks like a very reasonable and encouraging if not positive kind of a risk profile from that small study. So we're comfortable continuing using that.
Dose level in patients with atopic dermatitis.
Yeah. So it's really it's patient population and disease indication difference, but it's really not uncommon for many many years.
Alright, thank you.
Thank you.
And our next question will come from Boy, a speaker from T. D. Cowan Your line is open.
Hi, This is <unk>, thanks for taking our questions I have.
<unk> he decided to return the asset.
I just wonder if you could give a little color for the reasons behind and also you had some cheetah back positive feedback.
<unk> opinion leaders and what what does that make you feel confidence can move forward with this afternoon.
Okay. Good certainly a good question and.
Pretty reasonable look Lilly has other priorities in a topic dermatitis and when we took when we took.
<unk> data and both lupus.
Lupus and an ectopic dermatitis to the various key opinion leaders every key opinion leader.
That review the data.
Believe that respect is promising therapeutic and needs to be advanced and the clinic to help patients. So I think we were very comfortable when we went to some of the troops thought leaders in a topic dermatitis in the truth, what leaders and lupus and had them look at the data. They were very impressed with it actually I think really you know.
We were very excited to get.
<unk> back from Lily I think they made a business decision that doesn't reflect on the inherent value of risk peg.
Instead, it really reflects their strategic direction, where roast pig would have been a potential competitor.
Their anticipated and soon likely be approved other therapy and a topic term Titus. So I I think you know, there's there's lots of reasons for them, giving it back to us, but I wouldn't I wouldn't say.
Lack of efficacy or for the for the drug is one of them I hope that answers your question.
Thank you that's very helpful. My second question is just general question is your company in <unk> in the amount of checkbooks.
Ah biotech so what what have you done in terms of Nidation that you expertise by 40 have you down can make it possible or a successful transition.
Okay since J Z as running that part of the organization I'll, let him answer that.
Yeah.
Through the years, we've been breaking in staff with expertise in both drug discovery and drug development in.
In immunology indications.
So we've been actually they bring that in and then when we have areas of either capability or another gap. Then obviously, we get help like like others do from outside experts to help us reinforce.
Of our decision, making and thoughts.
That collectively within the team that's been developing in the pipeline. There are many many years of experience working in the immunology fields across multiple diseases multiple kind of immunology settings, and that's across many companies and particularly in large pharma.
But there was a lot of expertise sir.
Thanks.
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Thank you.
And I am showing no further questions from our phone lines and I'd like to turn the conference back over to Howard Robin for any closing remarks.
Thank you everyone for joining us today, and again I want to thank our employees for their commitment and focus through some of these difficult and challenging times, which were all seem to be having in biotech. These days.
We look forward to sharing our progress in the development of respect with everybody. So please stay tuned I think there's a lot of potential for this molecule. Thank you very much.
This concludes today's conference call. Thank you for your participation you may now disconnect everyone have a wonderful day.
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