Q3 2023 Altimmune Inc Earnings Call
Okay.
Good day, ladies and gentlemen, and welcome to the Ultimate Inc. Third quarter 2023 financial results Conference call.
At this time, all participants on a listen only mode.
Later, we will conduct a question and answer session and instructions will follow at that time to ask a question. During the session you will need to press star one one on your telephone as a reminder, this call is being recorded.
I would now like to introduce your host for today's conference call, which Eisenstadt, Chief Financial officer of autonomy and Mitch you may begin.
Thank you Olivia and good morning, everyone. Thank you for participating in <unk> third quarter 2023 financial results and business update conference call.
Members of the ultimate team joining me on the call today are Vipin Garg, Chief Executive Officer, Scott Roberts, Our Chief Scientific Officer, and Scott Harris, Our Chief Medical Officer.
Following our prepared remarks, we will hold a question and answer session.
Yes release with our third quarter 2023 financial results was issued this morning and can be found on the Investor Relations section of the Companys website.
Before we begin I would like to remind everyone that remarks about future expectations plans and prospects constitute forward looking statements for purposes of safe Harbor provisions.
Private Securities Litigation Reform Act of 1995, Ottoman cautions that these forward looking statements are subject to risks and uncertainties that could cause actual results could differ materially from those indicated for a discussion of some of the risks and factors that could affect the company's future results of operations. Please see the risk factors and other cautionary.
Statements contained in the company's filings with the SEC 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 Tuesday November 7th 2023, and the company does not undertake any obligation to update any of these forward looking statements to reflect events or circumstances that occur on or after today's date.
As a reminder, this conference call is being recorded and will be available for audio replay on <unk> website with that I will now turn the call over to Dr. Vipin Garg, Chief Executive officer of often here.
Vipin.
Thank you Rick and good morning, everyone.
We appreciate you joining us today part of the water.
Water.
Got it.
Yeah.
We're excited about that.
Our lead product candidate <unk>.
A L P. One glucagon dual receptor agonist.
But oh both obesity.
It's not subjective.
Yeah.
Eight.
John could you tie subjects with obesity and overweight.
Target.
948 week results each quarter.
We call them.
I showed weight loss.
Got it.
At the two plants.
Those.
People are free.
These robust reductions in body weight.
Gathered with the effects of practical Guy.
Back pressure.
Without it.
We could probably create the cockpit.
Oh great.
Talk to your basket of signals.
That is true.
It may be an option.
The option for patients with obesity.
Actually don't get F&B.
Yes.
It is important to point out.
These two conditions are.
Approximately.
You'll be population.
You know gas program.
Yep Yep Yep.
Fast track designation is granted.
Cash.
Fast track designation.
The grammar.
I maybe deal with drugs.
Good thing.
Yeah.
Yes.
That radical.
That's a good growing public health concern.
There are currently.
Great.
The FDA.
Paul talk by the Big banks.
Let people.
So clients that.
That's a good guide.
Objective it exactly.
Exactly.
Relative reductions they've looked at okay.
Yep.
Combined with significant weight loss, what it cheap.
Okay.
The efficacy and safety of package.
Got it.
You make it back.
Our face to be exact.
Because people can afford biopsy trial.
Given the competitive data.
Great.
We.
Back to achieve significant grade stuff that we do.
Hi.
Data read out exactly.
Hi.
As also announced.
Data.
Terry I traffic effects that we do that.
Will be presented at a late breaking abstract at Air Canada.
That would be.
You can go to a prior press release both website.
Okay.
King.
Finally, we expect to have a data readout from our phase two b clinical T cell.
Chronic hepatitis b in the first quarter of 2024.
Recall that this trial is designed to show evidence of anti coagulant effects.
That is b virus.
Fabless to go into practice.
Combination therapy.
Okay.
That's a fact that you guys don't have to sell it.
Results of these ongoing trials.
With that I'll now turn the call.
Wood products.
Okay.
Dr. Scott Harris to discuss out Scott.
Scott.
Thank you vipin and good morning, everyone.
I will start off with our phase III momentum trial of <unk> in obesity.
The momentum trial enrolled 391 subjects with obesity or overweight with at least one comorbidity, but without diabetes Dr.
Dr. Lu Ronnie from Wild Cornell Medical School.
A leading authority in obesity and obesity clinical trials.
<unk> is the principal investigator.
Subjects were randomized one to one to one to one to one two milligrams or one eight milligrams two four milligrams of <unk> or placebo administered weekly for 48 weeks in conjunction with diet and exercise.
A prespecified interim analysis was performed on 160 subjects.
<unk> completed 24 weeks of treatment.
Weight losses of 10, 7% at the two four milligram dose of nine 4% at the one eight milligram dose were achieved compared to a 1.0 weight loss in subjects receiving placebo approximately.
Approximately 50% of the subjects achieved at least 10% weight loss and approximately 20% of subjects achieved at least a 15% weight loss by week 24, as a $2 four and one eight milligram doses.
Significant improvements are positive trends in cardio cardio.
Cardio metabolic risk factors were observed.
Importantly, these effects were achieved without a rhythm yes.
Let me put meaningful heart rate increases or other safety signals.
These results are impactful in view of the data readouts from other compounds in the obesity space.
At 24 weeks, the placebo adjusted weight loss achieved by summer Glu tightened and tears appetite were approximately 8% and 12% respectively.
With paying for you Todd occupying in the middle of this range at approximately 10% weight loss.
It should also be pointed out that at the 24 week time point.
The magnitude of LDL cholesterol reduction in terms of do tie treatment with several fold better than that achieved by summit Glu title two separate tied in a similar population at the conclusion of their trials, but at 68 and 72 weeks respectively.
We believe that it is the action of the glucagon receptor agonism.
In terms of <unk>, but not in semi glued tied or curious appetite that leads to the improved effects on lipid lipids and differentiate <unk>.
The important reductions in lipid based cardiovascular risk factors.
Suggests that <unk> has the potential to achieve even greater reductions in cardiovascular risk.
Then there is observed in the recently completed select cardiovascular outcomes trial.
Of important note temperature tight has not been associated with minimal heart rate increases in any of our trials to date by contrast, other G. L. P. One base more multi agonists containing glucagon had been associated with these increases and in one case it resumes.
This may prove to be an important differentiator as cardiac effects, maybe need may not be tolerated in a population with higher cardiovascular risk such as elderly individuals or individuals with preexisting cardiovascular disease.
We see the obesity marketplace is becoming highly segmented based on the different patient needs and profiles with tempted to tie fulfilling their need for the large segment with elevated lipids or liver fat content.
We estimate to be approximately 70% of the obesity market place.
<unk> may also provide the opportunity to initiate or established therapy without dose titration, which we believe may be a highly attractive option to primary care physicians as the obesity market.
Rose beyond specialty clinical settings.
We believe <unk> profile may be an ideal treatment for many patients and physicians segments. It may ultimately capture a significant portion of the obesity market.
We look forward to the topline 48 week results from the momentum trial later this quarter.
It should be noted that the placebo adjusted weight loss achieved by semi glu tied in serious appetite at 48 weeks were approximately 12% and 17% respectively.
And based on our analysis of the 24 week interim data, we believe that attempt to do tie could achieve weight loss in the mid teens.
48 week time point.
As discussed previously by Dr. <unk> <unk>, our lead investigator in the momentum trial. This represents an important benchmark for a reversal of most if not all of the key morbidities of obesity.
Importantly, it should be pointed out that <unk> tied in serious appetite exhibited continued weight loss from week 48 through weeks 68, and 72, respectively.
The weight loss curves generated in recent trials with glucagon containing compounds suggests that the weight loss with Panther, Utah May continue beyond the 48 week time point.
This gives us confidence that the weight loss beyond the Midland that weight loss beyond the mid teens could be achieved as subjects were to be treated for a longer durations.
We are optimistic about the pending results and look forward to ongoing discussions with FDA about the design for phase III program, which we hope to commence with a partner in the second half of 2024.
Now, let me talk about our impact phase III Nash trial <unk>.
<unk> driven Nash trial is being conducted at approximately 60 sites in the U S with Dr. Stephen Harrison Medical Director Pinnacle Research and adjunct Professor of Medicine, Oxford University surfing is the principal investigator.
We're planning for approximately 190 subjects, both with and without diabetes to be enrolled.
Subjects, who are randomized to <unk>, one two milligrams <unk> 1.8 milligrams or placebo in a one.
One to two to two ratio and we will be stratified for fibrosis stage and the presence or absence of diabetes.
Therefore, approximately 38 subjects are expected to receive Perms do tied one two milligrams 76 subjects Panther do tied one eight milligrams and 76 subjects placebo.
This trial will enroll subjects with a BMI of at least 27 kilograms per meter squared of liver fat content of at least <unk>, 8% as measured by MRI <unk> and Apple <unk> score of at least four on a tree peep pre treatment biopsy and neither aperture F three fibrosis with <unk>.
50% of subjects required to have F. Three fibrosis.
The primary efficacy end points of the impact trial will be the dual endpoints of achieving either Nash resolution with no worsening of fibrosis or fibrosis improvement with no worsening of Nash with the primary primary treatment comparison being the one eight milligram dose versus placebo.
Secondary endpoints will include achievement of both Nash resolution and fibrosis improvement.
Liver fat reduction by MRI, PD FF corrected T. One response rate serum lipids and other noninvasive markers of disease.
Importantly weight loss also be assessed as a key endpoint as we believe this will be an important differentiator with respect to the majority of Nash therapeutics in development.
All efficacy endpoints will be evaluated week 24 of treatment and subjects will continue to be dosed and followed for an additional 24 weeks to a total of 48 weeks for safety and additional biomarker responses.
As a reminder, the 24 week data from our novel <unk> trials suggested greater than 75% relative reduction in liver fat at 24 weeks with over 50% of subjects, achieving the high bar of normalization of liver fat at the 1.8 milligram dose.
We also achieved significant reduction in serum <unk> and MRI based corrected T. One imaging both important important markers of Nash improvement.
As Vipin mentioned, new clinical data on the anti inflammatory and anti fibrotic effects of Pampa do Todd will be presented as a late breaking abstract at <unk> S. L D.
We believe that a robust robust reduction in Nash activity combined with fibrosis improvement in winning meaningful weight loss will be essential for a competitive product in the Nash marketplace.
Also as we have previously announced we have completed the enrollment in our phase II multicenter clinical trial of <unk> T cell in patients with chronic hepatitis b.
Chronic hepatitis B continues to represent a serious unmet need in the United States and worldwide and represents a significant commercial opportunity.
Hip T cell and immuno therapeutic designed to activate T cells to fight the hepatitis B virus infection.
The <unk> T cell trial was designed to enroll 80 subjects with an active chronic hepatitis b and low hepatitis b surface antigen. The primary endpoint of this trial is one log reduction or clearance of the hepatitis b surface antigen.
We expect to announce the results of this trial in the first quarter of 2024 once all subjects complete the six month treatment period.
It is generally believed in it and in fact that an effective therapy for chronic hepatitis b will require both direct acting antivirals in immunotherapy and we believe that Hep T cell is highly differentiated and may provide a functional cure of chronic hepatitis b.
Infection, when combined with novel direct anti direct acting.
Antivirals.
I will now hand, the call over to Richard Eisenstadt to give an update on our third quarter financial results rich. Thank you Scott and good morning, again for today's call I'll be providing a brief update on <unk> third quarter 2023 financial and operating results.
A more comprehensive information will be available in our Form 10-Q to be filed with the SEC later today.
Immune ended the third quarter of 2023 with approximately $148 million of cash cash equivalents and short term investments compared to $184 9 million at the end of 2022.
Research and development expenses were $18 million in the third quarter of 2023 compared to $23 million in the same period in 2022.
Approximately $12 million of this total for the third quarter of 2023 were direct expenses for the conduct of our clinical programs, including $10 $4 million of direct costs related to development activities for pembina to tide and $1 $6 million in direct costs related to development activities for <unk>, we anticipate a.
Brief we anticipated a brief and small increase in research and development expenses during the ramp up of our impact trial as we completed the in life portion of our momentum trial. Looking ahead, we expect the increase in expenses related to impact trial will be offset in part by reductions in expenses the momentum.
While winds down.
General and administrative expenses were consistent period over period at $454 $5 million for the three months ended September 32023 and 2022.
Approximately $2 $9 million of our quarterly operating expenses noncash expense primarily stock compensation.
Interest income was $1 $9 million in the third quarter of 2023 compared to $1 1 million in the same period in 2022.
Net loss for the three months ended September 32023 was $27 million or <unk> 39, net loss per share compared to net loss of $23 $5 million or 48 net loss per share for the third quarter of 2022.
We estimate that our existing cash funds us through the 24 week biopsy results from our impact phase III Nash trial expected in the first quarter of 2025.
Operator that concludes our formal remarks and wed like to open the lines to take questions could you. Please instruct the audience on the Q&A procedure.
Certainly ladies and gentlemen to ask a question you will need to press star one on your telephone.
For your name to be announced to withdraw your question. Please press star one again.
Please standby, while we compile the Q&A roster.
Okay.
And our first question coming from the line of.
Yes, <unk> Rahimi from Piper Sandler Your line is open.
Good morning team and thank you so much for all the great updates.
To the extent you can comment on and fully momentum data like I know it set for this quarter enrollment finished in September.
Any chance this is kind of a potential come around.
This month or next month, so to the extent you could provide a little bit color on.
When when and this quarter, we should be expecting Ed.
And the second question is in the past you guys have spoken about also at the top line to provide some modeling analysis to be able to look at the curve of weight loss I just wanted to make sure that's still occurring as we head into the top line data.
And then maybe the third question is just some cadence on given that.
Pat has a weight loss and a really desirable product profile.
What is the enthusiasm among.
Sites and patients as they have eligibility to be part of the study. So I. Appreciate if you could tackle those three for me and I'll jump back into the queue.
Thanks, guys.
Thank you for the questions.
Yeah.
Hi, Scott Scott do you want to take.
Yes, I can take this.
So you asked me in the guidance you can provide at the current time is that we finished enrollment.
We finished dosing in September there is obviously a safety follow up period after that of approximately four weeks, there's time for data clearing cleaning. So as we said, where we're really headed towards readout this quarter and at this time, that's about as much information as I can provide but I think the arithmetic is there.
You can you know you can do the calculation back based on the information in the public domain.
Regarding the modeling analysis, yes, as I said.
Weight loss is expected to continue beyond 48 weeks.
Based on the shape of the curve of other compounds, particularly reducing our containing compound and we will model that and try to provide with weight loss would look like had patients has been followed for the 68 to 72 weeks.
Of other compounds.
I would emphasize there has been a great deal of enthusiasm from not only patients.
But also sites and in particular, Dr. Lu of Roney.
Who is the principal investigator on the trial as he echoed during the reading of our 24 week weight loss. He thinks that this is an extremely important drugs based on its differentiated profile. The fact that the marketplace will be segmented with different needs for weight loss.
Lipids lipid fat reduction piece, particularly interested in the absence of the need to dose titrate because he feels very strongly that the great majority of this marketplace.
Move to primary care and the absence of really the need to achieve.
<unk>.
Bariatric surgery type weight loss in patients we think this site's feel them.
Patients feel as well based on the reactions that.
This is going to be very successful product.
Okay.
Yes, Scott There was also a question about the underground.
Trials based on the.
Weight loss properties could you elaborate on that as well.
Yes, sure. So we're seeing very brisk enrollment an impact we're very pleased with it and the commerce ruling from patients and investigators is that you've got the drug out there.
In Nash trials, that's not only treating Nash, which for most patients.
This is invisible they have there.
They have a condition in the liver, what they're really coming to a draw for us the weight loss.
And we think that.
Their reaction and the impact trial will reflect the uptake of <unk> in the marketplace. When they finally gets approved.
Okay.
Okay. Thank you so much I'll jump back in the queue.
Yes.
Thank you and our next question coming from the line of Gordon Jenkins with Goldman Sachs. Your line is now open.
Hi, This is omar or Karen. So first question is what do you view a successful outcome for that 48 week momentum readout with respect to weight loss and then.
What can you just check size for us how that positions <unk> to tight given both the safety and efficacy efficacy considerations.
Thank you Mary I'll answer both of those questions. Yeah. So Ah Mary you know, we as we've said we feel comfortable that.
We could achieve weight loss in the mid teens, which as Dr. Kerr Ronnie pointed out is key.
Before moving.
Most if not all of the Comorbidities of obesity, and we feel comfortable that we'll be in that range.
And that also will continue to see weight loss beyond that so if you recall the weight loss achieved by tours appetite in some glu title at 48 weeks was lessened. It achieved at 48 weeks at 72 weeks or <unk> 68, and 72 weeks.
And that will continue to see weight loss or would have continued to see weight loss beyond the 48 week time point and as I mentioned.
And my response, Yasmin, we'll model that for investors and estimate what we think the weight loss would be an extended time points.
We see this drug extremely well positioned in the obesity marketplace, especially fitting the segment of patients.
Who need to get further reduction in their serum lipids reduction in their liver fat content both important.
Risk factors.
For cardiovascular disease, but most importantly, achieving it safely.
And I want to emphasize that we have not seen the heart rate increases at least not seen meaningful heart rate increases with Panther do tied or a rhythm yes, that's been seen in other compounds, especially the compounds.
The dual agonist that contain glucagon. So we think the safety profile. The good solid weight loss the effect on serum hepatic lipids and especially in primary care, which we believe is going to dominate the obesity marketplace in the future the convenience of not having a dose titration at least at the one.
Eight milligram dose.
Okay.
Thank you <unk>.
Question.
And our next question coming from the line of Roger song with Jefferies. Your line is now open.
Great.
But.
But the progress and the same.
But update a few questions from us. So the first one is regarding that assuming the momentum phase two data meeting your expectation.
How.
What is your current thinking around the phase phase III design, particularly around the dosing and titration.
Given you know, we see it a bit higher.
Continued due to AE in phase two which is similar to other phase II, but you know in phase III, you probably want a lower rate for phase III stab can you remind us what what is your current thinking.
For the design portion and second question is related to the partnership. So I think on the call. You mentioned you will start a phase III in second half next year with our partner maybe just.
Can you give us some color around that discussion at this point, particularly with the momentum 48 week data Hall.
When will trigger additional discussion to make this material. Thank you.
Roger Roger I'll answer the first question Roger Scott do you want to.
Yeah.
Yeah go ahead.
Yes, Raj I'll answer the first question I'll turn the microphone over to <unk> for the second question.
So.
The ultimate design of the Phase III trial will be set at a discussion with partners and also in discussions with the FDA and we anticipate.
Having an end of phase II discussion with FDA in 2024 based on the results of the minimum trial.
We see all of the current doses as being viable going forward.
The one two and $1 eight milligram doses are given without dose titration and currently the two four milligram dose is given with a very short four week titration.
It's about one fifth of duration of curious appetite dosing and even lower than that prolonged titrations that are being used beyond to half a year and other programs or will be used in phase III programs.
So we see those doses moving forward as you mentioned.
There was.
A higher than we expected adverse event discontinuation rate at the two four milligram dose, but as you pointed out it was the same if not less than the adverse event is continuations that had been seen in other phase III programs like the <unk> type program Giuseppettite phase II programs and that they made the necessary adjustments going into phase.
Three do you get there adverse events down towards where they are right now in the single digits. We have a lot of opportunity to do that we have as you said, we could modify dose titration, but a very important difference.
From the.
The other trials that we did not allow dose reduction and as I mentioned before in the tourist appetite in some of <unk> trials as much as 30% of those patients either never got up to the highest dose or dose reduce once they got there and consequently, you can see that by putting a dose reduction scheme.
<unk>.
We're more flexibility in the up titration and our study we are studying as we really think that we can get that adverse event rate down even without having to dose titrate any further than we are right now.
Vipin.
Would you like to answer the second question about the partnership.
Yeah. Thanks, Scott so at all.
We have said before obviously gets 48 to standardize things Facebook Google partnership discussions forward.
<unk> already received multiple discussions about that.
Our goal is to be ready by the second half of next year.
That gives us enough time plenty of time to answer lineup of blockbuster initiate that phase III program. So that's really what we're executing to.
With that with the data that we are expecting a 48 week readout and that would give us the best opportunity to tighten up the lineup the partner.
Or are we going to phase III.
Excellent. Thank you.
Based on that.
Thank you.
Our next question coming from the line of my Mum, Tony from B Riley Your line is open.
Hi, This is William wood on for Mylan today, congratulations on the quarter.
So a couple of questions from us thinking about your upcoming phase III momentum topline readout are there any data set that you've recently prioritized and decided to include possibly body composition of our lean muscle.
Yes William.
The readout that we're going to have this quarter will be in many ways similar.
To the.
Parameters that we ran out before 24 weeks, so let me repeat that.
It will include body weight loss.
We include waist circumference it'll include serum lipids.
It will include.
A readout on vital signs, which we think are very important and differentiating and will include glycemic control and also reported adverse events with data included on the discontinuation.
We also expect to have data on reduction in liver fat.
We are doing body composition measurement. So this trial at this point, we do not think that we're going to have them for the top line results because they require more analysis.
And then just.
<unk> fat analyses, so that additional readout on say lean body mass will probably come sometime after the topline results.
Got it.
Then you mentioned and you've previously reported that you have a presentation coming up at AAN.
D a.
This weekend or early next week.
Mentioned that it's going to be new data on anti inflammatory and anti fibrotic properties attendee.
Do you think you could go into a little bit more color on what we may expect to see and how we should view that data feeding into the FDA decision granting your FTB and then obviously youre your impact trial.
Thank you William.
Discuss the data in that poster because it is embargoed.
By <unk> rules as late breaking abstracts, but as you can see the FDA. So all of the data, including the data that the additional data that we'll present additional data on not only anti inflammatory properties of <unk>, but even more importantly, the anti fibrotic properties of <unk>.
And there we are aware of all of that when they fault saw the fast track.
Application and granted designation to.
Auto immune we believe that Panther do Todd.
With its very high reduction in liver fat content and class leading effects on anti fibrotic anti inflammatory markers will result in important improvements of fibrosis in the abstract will highlight the observations that we've made to date on the latter point.
I appreciate it and then one last quick one your impact trial is enrolling at.
Two or three patients I believe you said, 50% have to be at three <unk>.
Given the difficulties we've seen recently in that floor at the current time do you foresee <unk>.
Trying to be run in in that for a population.
It's a great question William that's something we're obviously, taking a very very good look at we haven't made any announcements on that to date right now we're concentrating on the F. Two F three population where we.
We're certainly taking a very good look at cirrhosis and the possibility of engaging that population in a separate clinical trial.
I appreciate it thank you very much for taking our questions and congratulations again.
Thank you.
Thank you and our next question coming from the line of Jonathan Waldman with JMP Securities. Your line is open.
Hey, thanks for taking the questions.
I guess two for me one a follow up from an earlier question. How do you think about an acceptable tolerability profile then.
The upcoming let them read out given the kind of tweaks. Scott you just discussed you could make going into phase III and then can you also discuss the differentiation from the other GOP.
One glucagon dual agonist, Merck MDI compounds, either structurally or even from the data we've seen.
Got it.
Good data from all three at this point I think that'd be helpful to hear.
Yeah. So.
We have to point out that any.
Tolerability data that's been generated to date has been.
In the absence of dose titration.
And the fact that we can achieve comparable safety and Tolerability Israeli.
As a complement to the.
The drugs and we believe that arises from the pharmacokinetics of <unk> tied with a slow entry into the bloodstream.
Remember that at the one two and $1 eight milligram doses the adverse event rates, leading to discontinuation were low and again the $1 eight was given without dose titration and still achieved a nine 4% weight loss at that point in time, which is as good as semi glu tied at the same time point when you look at it on a.
Placebo adjusted basis.
Obviously, there is a lot of opportunity to tweak the dosing any way we wish.
To get that profile down even better than it is right now and as I mentioned before Jonathan We think we can do that without dose without adjusting the dose titration by simply allowing for dose reduction in future trials. So we're obviously optimistic about that.
Regarding the other compounds starting from the structural viewpoint.
One knows that in addition to the Newport domain, which we think is unique and conveys special pharmacokinetics to the drug.
We also have a one to one ratio of <unk>, one glucagon agonism, which has the highest concentration of glucagon in the glucagon dual agonist that are available today. In contrast, the Merck has announced that its about two to one bias towards <unk>, one and the <unk> compound <unk>.
<unk> is about eight to one.
We believe that it's the higher glucagon content that conveys the properties that we've seen but it's also important to note that.
These compounds have both been associated with heart rate increases.
And that we're not seeing these heart rate increases in our program and we think that's a very important differentiator.
We've not seen any liver fat data with the boehringer compound. Some discussion has taken place around meetings that theyre not seeing changes in serum lipids, we think that reflects the low glucagon compound content and that compound.
And the Merck data they are seeing relatively comparable reductions in liver fat, which we speaks to the glucagon activity in both compounds.
Thanks for the color Scott.
Thank you and our next question coming from the line of Patrick <unk> with H C. Wainwright. Your line is open.
Good morning, everyone. This is luis for Patrick.
You for taking my questions I'm going to change gears here and talk a little bit about how T cell and the.
The way that the field has been looking at immune modulation as an asset.
<unk> necessity and HBV cure.
Switching to actually procure so.
Can you talk about how your treatment is progressing towards a functional cure that could.
Achieved.
This mechanism this immune modulation mechanism, where others don't have that.
Sure I appreciate the question there.
What we've already demonstrated with hefty cell is that the.
Therapeutic which is a T cell immunotherapy <unk> meant to.
To boost that T cell response over there.
Resistance it has to have seen the HPV antigen.
We've demonstrated in our phase one studies that it's very safe and that it's able to significantly increase the T cell response to HBV antigens and so the next step we felt it was important since this is going to be used as a combination therapy, most likely with direct acting in.
<unk> like <unk>, our monoclonal antibodies or oligonucleotides against the surface antigen for example to show that we have on hand activity on its own and.
And so thats what this phase II study, that's currently ongoing and we'll report out in the first quarter of next year is meant to show the.
The advantages of hefty cell has to do with the focus of the T.
T cell response against antigens that are known to be important for.
Got it.
Our functional response and that is a preliminary sandwiches and the core antigen.
The epitopes that were selected and represented an hefty cell are highly and varied there are hydrophobic in nature and.
And so they're unlikely to mutate in response to the immune pressure that will be generated so what we have is a immuno therapeutic that is expected to be active against all of the circulating genotypes of HBV.
And with combination with the adjuvant that we are using IC 31.
Which.
As a pre clinically looked very encouraging and in our phase. One study was shown to be important for these T cell responses, we feel that we're going to be able to generate a very.
Robust.
<unk> response with surface antigen and other measures of HBV.
HBV replication.
I'll, then set us up for partnering discussions with.
Companies that have these direct acting antivirals and allow us to do that in phase II studies in combination therapies.
That sounds great.
And do you plan to stratify patients based on.
Surface antigen at baseline.
You've seen that with <unk>.
The <unk> phase III program can you discuss more the base.
Baseline characteristics of the phase III trial.
If you're successful lease you're going to implement that threshold of surface antigen at baseline going forward.
Sure that's a great question.
One of the unique design elements of the phase two study Thats currently ongoing and report out here. Shortly is that we've selected patients that are referred to as an active carriers basically these folks have low surface antigen levels compared to many chronically infected individuals.
Individuals.
And we felt that that would represent a population that has received direct acting antivirals has had the surface antigen reduced by the mechanisms that I referred to earlier and then created a better environment for the immuno therapeutic to work and boost the T cell response, so going forward.
And we don't see that selecting patients with low surface antigen is we think that the combination therapy. The first part of that with the direct any.
Direct acting Antivirals will accomplish that goal and then hefty cell will work as it is in this study. So the study is really meant to.
Look forward towards the combination studies and how their patients would present themselves for treatment with <unk> T cell.
Sounds great can you just remind me quickly as this with or without interfering and do you plan to.
And armed with and without interference in the combination setting.
So the current study does not include interferon in the in the treatment regime going forward I think that there is any number of combination approaches that can be envisioned and that's something that we'll talk more about as we get a little further down the road.
Sounds good thank you so much.
Yes.
Thank you.
And I see no further questions in the queue. At this time I will now turn the call back over to Dr. Vipin Garg for any closing remarks.
Thank you everyone for participating today, we appreciate the opportunity to share our results and outlook with you and thank you for your continued interest.
Nice day.
Ladies and gentlemen that does conclude our conference for today. Thank you for your participation you may now disconnect.
Okay.
[music].
Okay.
[music].