Q4 2023 Enanta Pharmaceuticals Inc Earnings Call
Speaker 1: Good afternoon and welcome to Enantis Pharmaceuticals Fiscal Fourth Quarter and Year-End Financial Results Conference Call. At this time, all participants are on a listen-only mode. There will be a question and answer session at the end of prepared remarks. Please be advised that this call is being recorded. I will now turn the conference over to your host, Ms. Jennifer Vieira, Investor Relations. Please go ahead.
Good afternoon, and walk us through in answers pharmaceuticals fiscal fourth quarter and year end financial results Conference call. At this time all participants are in a listen only mode. There will be a question and answer session at the end of the prepared remarks. Please be advised that this call is being recorded.
I would now like turn the conference or to your host Ms. Jennifer <unk> Investor Relations. Please go ahead.
Speaker 2: Thank you operator and thanks to everyone for joining us this afternoon. The news release with our fiscal fourth quarter and year end 2023 financial results was issued this afternoon and is available on our website. Making formal remarks on today's call are Dr. Jay Lulai, President and Chief Executive Officer, and Paul Mellett, our Chief Financial Officer.
Thank you operator, and thanks to everyone for joining us. This afternoon. The news release with our fiscal fourth quarter and year end 2023 financial results was issued this afternoon and is available on our website.
<unk> formal remarks on today's call are Dr. J, Lullay, President and Chief Executive Officer, and Paul Mellett, Our Chief Financial Officer, Dr. Scott Rottinghaus, our Chief Medical Officer, and Dr. Tara Keefer, our senior Vice President of New product strategy and development will be available during the Q&A portion of the call before we.
Speaker 2: Dr. Scott Rottinghaus, our Chief Medical Officer, and Dr. Tara Keefer, our Senior Vice President of New Product Strategy and Development, will be available during the Q&A portion of the call. Before we begin with our formal remarks, we want to remind you that we will be making forward-looking statements.
We begin with our formal remarks, we want to remind you that we will be making forward looking statements, which may include our plans and expectations with respect to our research and development pipeline and financial projections, all of which involve certain assumptions and risks beyond our control that could cause our actual developments and results to differ materially from them.
Speaker 2: which may include our plans and expectations with respect to our research and development pipeline and financial projections, all of which involve certain assumptions and risks beyond our control that could cause our actual developments and results to differ materially from those statements.
Speaker 3: A description of these risks is in our most recent Form 10-K and other periodic reports filed with the SEC. ANANSA does not undertake any obligation to update any forward-looking statements made during the call. With that, I'd now like to turn the call over to Dr. Jay Lulai, President and CEO . Jay? Thank you, Jennifer, and good afternoon.
Statements of dish.
Scripps and of these risks is in our most recent Form 10-K and other periodic reports filed with the SEC Anantha does not undertake any obligation to update any forward looking statements made during the call with that I'd now like to turn the call over to Dr. Jay <unk>, President and CEO Jay.
Thank you Jennifer and good afternoon, everyone.
Speaker 4: In fiscal 2023, Enanta took important steps leading to meaningful progress in addressing the unmet need for treating serious respiratory viruses and advancing our business objectives.
In fiscal 2023 announced that took important steps leading to meaningful progress in addressing the unmet need for treating serious respiratory viruses and advancing our business objectives.
Speaker 4: As we look toward the future, we continue to assess opportunities that will leverage our expertise to transform the lives of patients by discovering novel treatments for viral infections and other diseases.
As we look toward the future we continue to assess opportunities that will leverage our expertise to transform the lives of patients by discovering novel treatments for viral infections and other diseases.
Speaker 4: 2024 is shaping up to be an important year for us with multiple inflection points expected, including potential growth into new therapeutic areas.
2024, shaping up to be an important year for us with multiple inflection points expected, including potential growth into new therapeutic areas today.
Speaker 4: Today, I'll provide an overview of our progress during the fourth quarter, beginning with our respiratory syncytial virus, or RSV, program. And then I will comment on the rest of our pipeline and give a business update.
Today I'll provide an overview of our progress during the fourth quarter, beginning with our respiratory syncytial virus or RSV program, and then I will comment on the rest of our pipeline and give a business update.
Speaker 4: RSV is a severe respiratory infection associated with significant morbidity and mortality that can cause serious disease in infants, children, and other high-risk populations, including the elderly and individuals with congestive heart failure, chronic obstructive pulmonary disease, or asthma.
RSV is a severe respiratory infection associated with significant morbidity and mortality that can cause serious disease in infants children and other high risk populations, including the elderly and individuals' with congestive heart failure chronic obstructive pulmonary disease.
Speaker 4: There remains a significant unmet need for RSV treatments despite the availability of vaccines and prophylactic monoclonal antibodies that reduce the risk of infection for some high-risk populations.
There remains.
With significant unmet need for RSV treatment, despite the availability of vaccines and prophylactic monoclonal antibodies that reduce the risk of infection for some high risk populations.
Speaker 4: Vaccines will inevitably have suboptimal uptake. And as we've seen with other respiratory viruses, even with adoption, breakthrough infections will still occur.
Vaccines will inevitably have suboptimal uptake and as we've seen with other respiratory viruses, even with adoption breakthrough infections will still occur.
Speaker 4: Further, while monoclonal antibodies can provide short-term passive immunity for infants, they will only shift the infant's first infection to the next season.
Further while monoclonal antibodies can provide short term passive immunity for entrance they will always shift the infants first infection to the next season.
Speaker 4: We aim to fill this unmet need for an RSV treatment through the advancement of our broad RSV program, which includes EDP938, the only N-protein inhibitor in clinical development, and EDP323, an L-protein inhibitor, both of which have fast-track designation from the FDA.
We aim to fill this unmet need for an RSV treatment through the advancement of our abroad RSV program, which includes Edp 938, the only N protein inhibitor in clinical development and Edp three to three and al protein inhibitor, both of which have fast track designation from the FDA.
Speaker 4: As such, we are evaluating EDP938 in two Phase II studies, RSV-PEDS and RSV-HR, as a potential treatment in high-risk patient populations.
As such we are evaluating Edp 938 in two phase two studies, RSV peds, and RSV HR as a potential treatment in high risk patient populations RSP peds as a phase two randomized double blind placebo controlled study in approximately 90 hospitalized.
Speaker 4: RSV-PEDS is a phase 2, randomized, double-blind, placebo-controlled study in approximately 90 hospitalized and non-hospitalized pediatric patients with RSV aged 28 days to 36 months.
Non hospitalized pediatric patients with RSV.
28 days to 36 months.
Speaker 4: It's a two-part study. Because this is the first time the drug is being dosed in pediatrics, the objective of the first part of the study is to evaluate the safety and pharmacokinetics of EDP938 and multiple ascending doses in order to select the optimal dose for each age group.
It's a two part study.
So this is the first time the drug is being dosed in pediatrics. The objective of the first part of this study is to evaluate the safety and pharmacokinetics of Edp 938 in multiple ascending doses in order to select the optimal dose for each age group.
Speaker 4: The objective of the second part of the study is to evaluate the antiviral activity of EDP938 at the selected optimal dose. It was designed as a small cohort to show a trend toward improved virology metrics for EDP938 compared to placebo and to give confidence to move forward efficiently into registrational studies. Additionally, we will evaluate symptom scores assessed through the treatment duration.
The objective of the second part of this study is to evaluate the antiviral activity of Edp 938 at the selected optimal dose.
Was designed as a small cohort to show a trend toward improved virology metrics for Edp 938, compared to placebo and to give confidence to move forward efficiently into Registrational studies.
Additionally, we will evaluate symptom scores assessed through the treatment duration.
Speaker 4: RSVHR is a Phase 2b randomized, double-blind, placebo-controlled study in adults with RSV infection who are at high risk of complications, including the elderly and individuals with congestive heart failure, chronic obstructive pulmonary disease, or asthma.
RSV HR is a phase to be randomized double blind placebo controlled study in adults with RSV infection.
High risk of complications, including the elderly and individuals with congestive heart failure, chronic obstructive pulmonary disease or asthma.
Speaker 4: Approximately 180 patients will be treated with 800 milligrams of EDP 938 or placebo for 5 days and evaluated over a 28 day period thereafter. The primary endpoint of RSVHR is time to resolution of RSV lower respiratory tract disease symptoms as assessed by the respiratory infection intensity and impact questionnaire or RIIQ symptom scale.
Approximately 180 patients will be treated with 800 milligrams of Edp 938, or placebo for five days and evaluated over a 28 day period thereafter, the primary endpoint of RSV HR is time to resolution of RSV lower respiratory tract disease, sometimes.
As assessed by the respiratory infection intensity and impact questionnaire or our IQ symptom scale.
Speaker 4: Secondary endpoints include additional clinical efficacy measures and antiviral activity compared to placebo, as well as pharmacokinetics and safety of EDP 938.
Secondary endpoints include additional clinical efficacy measures and antiviral activity compared to placebo as well as the pharmacokinetics and safety of Edp 938.
Speaker 4: In this study, we'll be looking for an improvement in time to symptom resolution, our primary endpoint, as well as effects on other secondary endpoints, such as antiviral activity. Both studies continue to enroll throughout the global footprint, with RSV-PEDS having over 75 sites across 15 countries, and RSV-HR over 130 sites across 16 countries.
And this study will be looking for an improvement in time to symptom resolution our primary endpoint as well as effects on other secondary endpoints such as anti viral activity.
Both studies continue to enroll throughout the global footprint with RSV peds, having over 75 sites across 15 countries and RSV EHR over 130 sites across 16 countries.
Speaker 4: Our goal continues to be completion of enrollment in at least one of these EDP938 studies with top line data in the third quarter of 2024, assuming we return to a normal pre-pandemic type of RSV season in the northern hemisphere.
Our goal continues to be a completion of enrollment in at least one of these edp 938 studies with top line data in the third quarter of 2024, assuming we return to a normal pre pandemic type of RSV season in the northern hemisphere.
Speaker 4: We are still early in that season, but initial data are consistent with a more normal season.
We are still early in that season, but initial data are consistent with a more normal season.
Speaker 4: Also advancing our leadership in RSV, today we announced the initiation of our Phase 2a challenge study of EDP323, an L-protein inhibitor, in development as a once-daily oral treatment for RSV.
Also advancing our leadership in RSV today, we announced the initiation of our Phase Iia Challenge study of Edp three to three and al protein inhibitor in development as a once daily oral treatment for RSV.
Speaker 4: In this randomized, double-blind, placebo-controlled study, up to 114 healthy adult subjects will be infected with the RSV-A Memphis 37B virus, and then randomized one-to-one-to-one to receive once-daily dosing of either 600 milligrams of EDP-323, 200 milligrams of EDP-323 with a loading dose of 600 milligrams on the first day, or placebo for five days.
In this randomized double blind placebo controlled study up to 114 healthy adult subjects will be infected with RSV.
Memphis 37, B virus, and then randomized one to one to one to receive once daily dosing of either 600 milligrams of Edp three to three.
200 milligrams of Edp 323, with a loading dose of 600 milligrams on the first day.
Or placebo for five days primary and secondary outcome measures include safety changes in viral load measurements and changes in baseline symptoms.
Speaker 4: Primary and secondary outcome measures include safety, changes in viral load measurements, and changes in baseline symptoms.
Speaker 4: We plan to report data from this study in the third quarter of 2024.
We plan to report data from this study in the third quarter of 2024.
Speaker 4: The advancement of EDP-323 is supported by positive Phase 1 results in which EDP-323 demonstrated favorable safety, tolerability, and pharmacokinetics in healthy volunteers. We believe either EDP-938 or EDP-323 would be effective as a monotherapy, but because the mechanism of action of each is different, we also have the opportunity to use them in combination.
The announcement of Edp three two to three years supported by positive phase, one results and which Edp 323 demonstrated favorable safety Tolerability and pharmacokinetics in healthy volunteers, we believe either Edp 938, or three two to three would be effective as a mono therapy, but because of the.
Some of action of each is different we also have the opportunity to use them in combination.
Speaker 4: Preclinically, the combination of EDP 938 and EDP 323 has additive to synergistic activity. A combination approach would allow us to explore potentially broadening the treatment window or providing additional benefit and specific harder to treat population.
Pre clinically the combination of Edp 938, and Edp <unk> three has additive to synergistic activity.
Combination approach would allow us to explore potentially broadening the treatment window are providing additional benefit in specific harder to treat populations.
Speaker 4: In hepatitis B, we believe we need an additional mechanism to develop in combination with EDP514, our potent core inhibitor with FDA fast-track designation. We think a core inhibitor such as EDP514 could ultimately be an important component of a successful combination regimen and potentially help us address the high level of unmet need in chronic HPV.
In hepatitis B, we believe we need an additional mechanism to develop in combination with edp five one for our potent <unk> inhibitor with FDA fast track designation, we think our core inhibitors, such as Edp 514, it could ultimately be an important component of a successful combination regimen and potentially help.
US address the high level of unmet need in chronic HBV.
Speaker 4: I'd like to take a moment to acknowledge that we have made important adjustments to our business this year to significantly reduce our 2024 spending and extend our cash runway through fiscal 2027, which Paul will cover in a moment.
I'd like to take a moment to acknowledge that we have made important adjustments to our business. This year to significantly reduce our 2020 for spending and extend our cash runway through fiscal 2027, which Paul will cover in a moment.
Speaker 4: As previously disclosed, we made the decision to stop RSV-TX, our phase two study in adult hematopoietic cell transplant recipients with RSV infection. We felt it prudent to concentrate our efforts and resources on our pediatric and high-risk adult studies, which comprise the largest patient populations with unmet need and represent the faster paths to market.
As previously disclosed we made the decision to stop RSV, TX our phase III study in adult hematopoietic cell transplant recipients with RSV infection, we felt it prudent to concentrate our efforts and resources on our pediatric in high risk adult studies, which comprises the largest patient population.
With unmet need and represent the faster paths to market.
Speaker 4: Furthermore, we made the decision to pause our HMPV-RSV dual inhibitor program. While the dual inhibitor has shown significant promise preclinically, we do not plan to move a third RSV compound into the clinic as long as our other two more advanced candidates continue to progress. And as we've mentioned before, we intend to conduct all future work in COVID-19 in the context of a collaboration.
Furthermore, we made the decision to pause our H MPV RSV dual inhibitor program.
While the dual inhibitor has shown significant promise pre clinically we do not plan to move a third RSV compound into the clinic as long as our other two more advanced candidates continue to progress.
And as we've mentioned before we intend to conduct all future work in COVID-19 in the context of a collaboration.
Speaker 4: These changes allow us to reallocate our focus and resources to diversify our portfolio into other disease areas. We believe this path forward best aligns with our long term goal at Enanta to deliver highly differentiated therapeutics through innovative chemistry and positions us to provide significant value to patients and our shareholders.
These changes allow us to reallocate, our focus and resources to diversify our portfolio into other disease areas. We believe this path forward best aligns with our long term goal to deliver highly differentiated therapeutics through innovative chemistry and positions us to provide significant value to pay.
<unk> and our shareholders.
Speaker 4: To that end, we are excited about the expansion of our research efforts into non virology indications that leverage our core strength and small molecule drug discovery. We look forward to providing more insight into our progress and announcing new therapeutic programs, starting in early 2024.
To that end, we are excited about the expansion of our research efforts into non virology indications that leverage our core strength in small molecule drug discovery, we look forward to providing more insight into our progress and announcing new therapeutic programs starting in early 2024.
Speaker 4: With that, I'd like to wrap up by highlighting our near-term milestones. We look forward to reporting results from our Phase 2a challenge study of EDP 323 in the third quarter of 2024.
With that I'd like to wrap up by highlighting our near term milestones. We look forward to reporting results from our Phase Iia Challenge study of Edp 323 in the third quarter of 2024.
Speaker 4: And assuming there is a return to a normal pre-pandemic type of RSV season in the Northern Hemisphere, we expect to complete enrollment in one or both of our Phase 2 studies of EDP938 and to have data in the third quarter of 2024.
And assuming there is a return to a normal pre pandemic type of RSV season in the northern Hemisphere, we expect to complete enrollment in one or both of our phase III studies of Edp 938 and to have data in the third quarter of 2024.
Finally, we will announce new non virology therapeutic programs beginning in early 2024.
Now I'll turn the call over to Paul to discuss our financials Paul.
Thank you Jay.
I'd like to remind everyone that <unk> reports on a September 30 fiscal year schedule.
Today, we are reporting results for our fourth quarter and full year ended September 32023.
For the quarter total revenue was $18 9 million and consisted of royalty revenue earned on <unk> Global Maverick net product sales.
This compares to total revenue of $20 3 million for the same period in 2022.
For the 12 months ended September 32023, total revenue was $79 2 million compared to $86 2 million for the same period in 2022.
The decrease in the quarter and year over year revenue is due to decline in abbvie sales in math right.
Beginning in the quarter ended September 32023, 54, 5% of <unk> ongoing royalties from add these net sales of Maverick that are included in our revenue are being paid to owners one of Canada's largest defined benefit pension plans pursuant to a royalty sale trans.
Action in April 2023.
For financial reporting purposes, the transaction was treated as debt with the upfront purchase payment to us of $200 million.
Recorded as a liability.
In addition, we will continue to record 100% of the royalties earned as revenue and will then amortize the debt liability proportionately is 54, 5% of the cash royalty payments are paid to owners until a cap of 142 times. The purchase payment has met after which point 100% of the cash royalty.
Payments will be retained by anantha.
Noncash interest expense the debt will be recorded in <unk> consolidated statement of operations as a nonoperating expense based on an imputed interest rate.
Interest expense was $3 2 million for the three months ended September 32023, and $5 1 million for the 12 months ended September 32023.
Moving now to our operating expenses.
For the three months ended September 32023 research and development expenses totaled $36 2 million compared to $34 8 million for the same period in 2022.
The slight increase was due to an increase in the timing of clinical trial cost offset by a decrease in preclinical and manufacturing costs for the 12 months ended September 32023 research and development expenses were 163 5 million compared to $164 5 million in 2022.
General and administrative expenses totaled $13 8 million for the three months ended September 32023, compared to $12 6 million for the three months ended September 32022.
For the 12 months ended September 32023, general and administrative expenses were $52 9 million compared to $45 $5 million in 2022.
The increases in both periods were primarily due to an increase in legal fees related to a patent infringement suit against Pfizer.
Other income net totaled $4 7 million for the three months ended September 32023, compared to <unk> 7 million for the three months ended September 32022.
For the 12 months ended September 32023, other income net totaled $11 4 million compared to $1 7 million in 2022.
The increases in both periods were primarily due to an increase in investment income due to an increase in our average invested cash balance from the receipt in April 23.
$200 million from the sale of our Maverick royalty as well as increases in interest rates year over year.
<unk> recorded an income tax benefit of $1 4 million for the three months ended September 32023, compared to an income tax expense of less than <unk> 1 million for the three months ended September 32022.
And Andrew recorded an income tax expense of $2 8 million for the 12 months ended September 32023, compared to an income tax benefit of <unk> 4 million for the 12 months ended September 30 of 2022.
Despite recording a financial reporting loss before taxes. During the 12 months ended September 32023, we recorded tax expense driven by the receipt of the $200 million from the royalty sale agreement, which is treated as income from federal and state income tax purposes.
This taxable income and its related income tax expense was substantially offset by net operating loss Carryforwards research and development tax credit carry forwards and a deduction for foreign derived intangible income.
Net loss for the three months ended September 32023 was $28 1 million or a loss of $1 33 per diluted common share compared to a net loss of $26 3 million or a loss of $1 27 per diluted common share for the corresponding period in 2022.
<unk> months ended September 32023.
Net loss was $133 8 million or a loss of $6 38 per diluted common share compared to a net loss of $121 8 million or a loss of $5 91 per diluted common share for the corresponding period in 2022.
And then at the ended the quarter with approximately $370 million in cash and marketable securities.
We expect that our current cash cash equivalents in short term marketable securities as well as our ongoing routine portion of royalties will continue to be sufficient to meet the anticipated cash requirements of our existing business and development programs through fiscal 2027.
Regarding guidance for fiscal 'twenty, four we expect our research and development expense to be between $100 million and $120 million and our general and administrative expense to be between $45 million and $50 million.
This is reduced from research and development expenses of $163 5 million and general and administrative expense of $52 9 million in fiscal 2023.
This general and administrative expense includes an increase in legal fees associated with our patent infringement suit against Pfizer.
Further financial details are included in our press release and will be available in our annual report on Form 10-K when filed.
I'd now like to turn the call back to the operator and open up the lines for questions operator.
Thank you, ladies and gentlemen, if you'd like to ask a question. Please press star one on your telephone again, if you'd like to ask a question. Please press star one one.
One moment for our first question.
Yeah.
Our first question comes from a lot of Orlando Lewis of Leerink Partners. Your line is open.
Hi afternoon, everyone.
Wanted to ask about one of your RSV programs for three Q3 with the challenge study I was curious assuming that successful how fast could you proceed to phase III and what sort of measures are you considering for phase III design like symptoms or virology endpoints.
Hi, Arlinda this is Jay so.
So we're aiming at.
We said on the call.
Finish up the challenge study and to report out data in Q3.
There's obviously some other things we would need to do.
In terms of preparedness for.
For fees.
Well beyond that.
The challenge study, let's just say that and I think what we're going to do is.
Simultaneously be watching the 93 eight studies.
And learning.
Ultimately from hopefully at least one of those datasets in peds or HR.
To help inform the development path of how we're thinking about Q3.
Going forward, so it's a little bit premature I want to also take a peek at the data from the challenge study.
Again, it's a very very potent molecule, it's got great PK.
We've set up a couple of different dosing regimens.
Both of which are effectively QD.
QD.
The high dose QD and then the other is.
A loading dose on day, one QD, followed by a lower dose.
These two through five so we will get the aggregate of the data look at it and see how it compares to 93 eight in the challenge study at least as best we can compare to challenge studies and then.
Thinking a lot about how we position.
Either of these in the market, we think that.
Either of them could be used as a single agent.
Also since they have different mechanisms to potentially be used in combination.
There's no cross resistance and.
And I think we would have.
Good barrier to resistance under the way we are.
We've chosen the mechanisms and dosing them, so lots of different kinds of options, but a little bit cleaner.
Premature to talk about <unk> three.
Too far down the line.
Yes understood.
And my second question I, just wanted to ask about the dual inhibitor program for human Metapneumovirus and RSV I was curious is that positive development. There is it more just to prioritize your other more later stage RSV trials or was there any new data that informed this decision.
Now the data I mean, the data continued to look really interesting in terms of the profile.
As we as we think about it again.
Got a fair number of things on our plate right now but.
We've got two more advanced RSV molecules moving ahead well.
<unk> and development.
The dual.
When you distill it down yes, it hits human melanoma, which we do think it's an advantage.
<unk> is a.
A fraction of the market of RSV.
Not an insignificant fraction, but it's still a fraction I think.
RSV having RSV.
Dual is very very important because RSV is a big piece of what that market would look like anyway.
When we sort of sat back and looked at our.
Current ongoing studies in the <unk>.
Resources involved.
Yes, we have two two that are moving along very nicely for the large piece of the overall market, which is obviously RSV.
We will.
We still have some.
Activities sort of.
Smoldering on that but I think that the key focus is going to be watching at our two lead horses that clinical data come out and then we've always got that molecule in our back pocket and reserve.
Got it thanks.
Youre welcome.
Thank you one moment please.
Our next question comes from the line of Jay Olson of Oppenheimer. Your line is open.
Oh, Hey, thanks for taking the question and.
Recognizing that it's early maybe just to follow up on <unk> three.
I guess, what are you hoping to see in the Phase Iia Challenge study, what extent of viral load reduction would be clinically meaningful and how do you plan to differentiate <unk> from 938. Thank you.
Thanks, Jay this is Jay.
Look forward to talking about once a quarter.
No.
I think the.
The challenge study is nice because it's been it's been run.
Against different classes of compounds thats been done substantially in the same way across different classes.
We've got a very strong data set with Edp 938.
The services that certain standard internally any way to compare data too.
The type of data that you would get from that is.
You look at.
Virology and symptoms so you'll look at.
And it's really compared against placebo right. So everyone is infected.
And not chelation day, so to speak.
Wait for the viral loads too.
To begin to bill and that happens variously.
Current day for one person versus another but once you start to register a viral loads.
The next day, you begin dose right. So.
What we found at least with 93 eight.
Was amongst immediately upon dosing.
<unk>.
Jack <unk> of the infection, so people who are dosed with placebo.
<unk> continue to rise.
And then they.
Gradually decline over a period of many days.
People, who are dosed with <unk>.
With our test agent.
You see viral load basically.
Stopped in their tracks and in fact are pushed downward.
So what that allows you to do is compare of the area under the curve drug treatment versus placebo and.
We put very strong numbers on the boards with Edp 930 agents I think in the 70% reduction on the AUC side.
Simultaneously youre tracking symptom scores and youre looking at a composite of multiple different sometimes.
Thats.
It's pretty much the same graph.
Placebos.
Track upward.
Ultimately plateau, and then have a slow decline and drug treatment.
That curve down pretty rapidly and pretty completely so again that allows you to compare the AUC of drug treatment.
In the numerator versus.
Placebo in the denominator.
Once again at least with 93 eight we put very strong numbers on the board in terms of percent inhibition.
So that's the type of data that will be going.
Four with 323.
Again.
We need to run the study to get the results, but it's pretty clinically.
A very very strong.
And having a very potent <unk> inhibitor.
And I would say, we've even got more from an exposure standpoint, everything else, even greater pressure on the virus with <unk> three.
Exposures.
Even over 93, eight which were good.
So.
Again, we will look at the data.
It may not be possible to differentiate at that stage.
But.
If it does differentiate and somehow we will see.
We certainly believe that 93 eight has sufficient horsepower.
To go the distance and most patients as a single agent, obviously, we need to prove that with the phase twos.
To the extent we.
Wanted to segment and maybe use a combo and a different patient population are relegated.
One of the drugs in a slightly different way than the other.
Having both of these mechanisms that are disposal will allow us to think of all kinds of things.
Great. Thank you Jay for the comprehensive explanation and if I could.
Could I ask just one follow on.
You have various non virology programs at early stages discovery stage of development can you just talk about what disease areas you're interested in for those non virology programs. Thank you.
Yes, not today.
As I indicated we'll begin to.
Talk about that early next year.
Okay, Great look forward to that thanks again for taking the questions.
Thank you.
Thank you one moment please.
Our next question comes from the line of.
Ed Arce H C Wainwright and company your line is open.
Yeah.
Hi, Jay and Paul Thanks for taking our questions I appreciate it.
Congratulations on the initiation of the Phase Iia Challenge study for <unk> three.
I also have a question in that regard.
Drill down a little bit further.
From the previous question.
With regards to.
Yeah.
Improvements.
As AUC with both virology and symptoms versus placebo.
You mentioned embryology previous asset.
Or I guess.
90, 338 as shown.
About 70% reductions in AUC.
Okay.
And so what I wanted to ask is what level you believe is both.
<unk> and clinically meaningful.
Or perhaps put another way what what.
Specific.
Level.
Our degree of reduction.
Defines success for the study sufficient to.
Proceed to further development.
And then I have a follow up.
Sure.
Well I think.
No one really knows yet and hopefully will be.
The first to show.
<unk>.
Yes.
What level, you really need to drive efficacy in the real world and infection.
We've looked at all the challenge study models that have been done.
And edp.
ADP 93, eight is basically as good as it gets in terms of driving those kinds of numbers in a challenged model. So.
We're hopeful that those or at least adequate numbers to do that translation R&D real world.
And in terms of what we're aiming for I mean, obviously nine created some sort of a standard.
Aim to be in the ballpark.
<unk> like efficacy.
Which again.
Can't translate this.
Pre clinically to clinically perfectly, but I think we use the same sort of criteria or metrics thresholds to past pre.
Pre clinically.
For <unk> as we did for 93 eight so.
We'll see how that translates but 938 like efficacy and the challenge is very strong.
And I'm, hoping we can do.
About that well with three to three.
The high bar.
Right right great.
And and then.
<unk>.
Staying with <unk> three.
I wanted to ask also.
Given that you are testing two different doses, one with a loading dose in the first day and then another one which is.
Uniform throughout the treatments if both of those.
<unk>.
Show.
Positive encouraging results.
What would be the rationale to continue.
Study, both doses, especially given.
The differential populations that might ultimately.
It can be treated with <unk> three.
Yes, it's a good question Ed I think.
Probably the short answer is we're hoping that we will define a dose.
From the challenge study and then move one forward.
Obviously 600 QD for five days.
Has more sort of horsepower may be more than than we need right and so.
Infectious disease often.
Yes.
Loading dose.
To help you get to steady state quicker and then steady state PK and then.
So what we're asking revenues.
Can that lower dose on the tail end of the one that the tailwind, but after the high loading dose in the maintenance.
Lower maintenance dose is that enough.
Just as good horsepower obviously.
Cost of goods perspective, they are very different.
So.
It's worth exploring and we'll get an answer and hopefully we'll get a clearer answer.
In terms of helping US guide future studies.
Okay, Great and actually one last one if I may.
I'm also.
As has been asked before.
One two ology indications.
I recognize that youre not.
Prepared at this moment to discuss specifics.
But just in terms of timing early 2024.
Fairly be around GPM.
And also given.
Your expertise with these.
New candidates necessarily be small small molecule assets. Thanks, so much.
Well you are correct.
<unk>.
Historic skills.
Ben.
Small molecule drug discovery and development.
That is still predominantly our main focus and.
With regards to timing it'll be it'll be early next year.
Great. Thanks, so much.
Yes.
Thank you.
One moment please.
Sure.
Okay.
Our next question comes from the line of.
Eric Joseph of JP Morgan Your line is open.
Hi, good evening, thanks for taking the question.
For the two.
RSP high risk study with <unk>.
All right.
I'm not sure if it's.
It has been clarified previously, but maybe just can you just remind us whether that study is open to patients who have been immunized with either of the commercial RSV vaccines.
Do you expect.
Prior immunization to comprise a meaningful proportion of.
The study's enrollment.
I'm just kind of maybe just looking longer term I'm curious to get.
Your thoughts on whether.
Okay.
Sort of how prior RSV vaccination should be treated.
In our phase III study design I guess would you want to I guess, how important is kind of looking activity on that background.
For the purposes of Registrational trial. Thank.
Thank you.
Well.
I'll answer part of the question and then hand, it over to Scott Riding House, our Chief Medical Officer.
With regards to current state of immunization I think.
Less than 5%.
The adult population.
Has been immunized.
And so it's not a significant factor in the current backdrop.
RSV recruitment today and I'll, let Scott talk about.
Inclusion etcetera, thanks, Jay So hi, Eric It's Scott Rottinghaus.
We're not currently studying vaccinated patients in our phase two study.
Obviously.
I have to see how things are going for phase III. When we designed that study going forward.
Okay.
And maybe just to follow up on the your runway guidance into 2027 can you talk about a little bit about sort of what that anticipates in terms of.
Nine.
938, or 323 development, assuming the data third quarter are supportive.
Yes, so it's advancing.
Really both of those trends.
Our pace advancing into registration studies.
For each so.
Yeah.
Yeah, No we're just pushing on Manhattan.
Okay got it.
In terms of the.
<unk> came from.
Focusing down on some of the.
Current activities, obviously, not taking a third RSV molecule into the clinic has some impact even though.
As I detailed a little bit.
Maybe leaving a little bit of an <unk> opportunity on the table for now.
The Big driver was obviously not doing COVID-19.
Outside of a partnership.
Covered was a big thing not only with the birds too.
Development, but also some of the other discovery activities, we had ongoing.
And then the third one.
Was.
Focusing.
93, eight development on the two.
Largest patient populations.
Peds being number one in adults high risk being number two it's not to say that again <unk> once.
Far along and hopefully.
Treating.
Those two patient populations, that's not to say that you couldnt pick up broader label subsea.
Subsequently.
And ultimately include transplant.
Just in terms of.
Our bandwidth.
Helpful.
From a pocket books.
Aspect of it is also helpful.
Thank you.
One moment please.
Our next question comes from the line of Brian Corny.
Of Baird. Your line is open.
Hey, guys. Thanks for taking the question. This is Luke on for Brian.
938, we were wondering is it more likely that we see data from the pediatric or high risk study first and then do you have any specific goals in mind for that but you see our biomarker endpoints that would give you particular degree of confidence as you think about planning a pivotal program. Thanks.
So it's.
Yes.
We can't make the call at this point in terms of.
Which trial could come before the other.
Again recruiting two very different patient populations with different.
Sort of.
Interesting aspects regarding recruitment so theyre not similar studies from a patient population perspective at all.
I think in.
And each of those studies were looking for.
<unk>, especially in the Peds study, we're looking for viral logic trends that push outs.
Yes.
Toward registration needs will be.
Fiber logic.
Sort of measures that we have.
Outlines.
And generally seen something good in virology as probably.
A very important that's a smaller study as we've indicated.
Sometimes getting enough symptom data.
It's going to be.
Well youll collect the symptom data you get and then we will try to figure out which are the most impactful.
Sometimes and look at that sort of data, but it's.
It's a very small study to be.
Harvests team a lot of symptom data that you can.
That you can't use productively.
As a secondary endpoint will take anything we can get there.
And I think also in the high risk patient population.
We're looking at time to resolution of symptoms.
And it's a symptomatic endpoint again looking for a clinically meaningful.
<unk> out there is what we would be aiming.
To do as well.
So the key is the challenges.
Not to be confused with the challenge study with the challenges constructively.
Constructing new studies in such a way that there.
Decision, enabling us to move forward to registration studies, but not sizing them to be registration studies in <unk>.
So I.
I think thats the balance that we've tried to strike with each of these.
No.
We're hoping for.
A good northern hemisphere season.
To the extent that seasonality can be viewed as being somewhat normal it seems to be coming around.
Historically more normal time recall that the pandemic.
First.
Moved RSV out of the equation.
As well as flu and.
Youre starting to see headlines now about flu starting.
To come back and we know that RSV is coming back and that's.
It started to we started to see it again historically has.
Picks up.
In late October and then.
Begins its ascent there so.
So far it looks like it's to see some of this on track we will just continue to.
To monitor and recruited away though.
Great. Thank you.
Thank you one moment please.
Our next question comes from the line of Lisa <unk> of Evercore. Your line is open.
Hi, Thank you most of my questions have been answered but I.
I guess would you preclude.
Entering into the <unk>, one space or that might that be an interesting.
Area for you to contemplate a compound.
Yes.
We're not really discussing our new areas.
Today I'm sorry.
Sorry, Lisa.
Rob.
Happy Thanksgiving.
Thank you.
Please.
Our next question comes from the line of Roy Buchanan of JMP. Your line is open.
Thanks for taking the question just a couple of quick ones first one RSV piece.
Speaker 5: Can you just kind of break down how many patients you expect in the MAD portion versus the, I guess, dose expansion portion? And then I think you were planning to have discussions with the FDA for 2.3.5 around potential endpoints.
Can you just kind of break down how many patients do you expect in the Mad portion versus.
Yes dose expansion.
Portion and then I think you were planning to have discussions with the FDA for 235 around potential end points.
Speaker 5: Can you just update us on any of those discussions, any feedback from the FDA?
Can you just.
Update us on any of those discussions any feedback from the FDA.
Speaker 4: Yes, for the study, it's, it's broken into a bunch of different parts, you know, because you have, you know, those escalation going on and multiple different little age groups, subsets.
Yes.
Each study.
Broken down into a bunch of different parts.
Because you have.
Dose escalation is going on in multiple different age.
<unk> age groups subsets.
Speaker 4: and then ultimately you do the dose range in there and then move over into the other side. I think the...
And then.
And then ultimately you do the dose range in there and then move over into the other side I think the.
Speaker 4: You know, the dose ranging part is slightly bigger than the other part, but they're, they're roughly balanced.
The dose ranging part is slightly bigger than the other part but there were.
Roughly.
Speaker 4: And then 2, 3, 5.
<unk>.
And then 235.
Speaker 4: You know, I think it's a, it's a situation where the, you know, the world is still settling down with code. But I think what we're what we're seeing is.
I think it's a.
Hey.
It's a situation where the world is still settling down.
With Covid I think what we're what we're seeing is.
Speaker 4: Well, what the world is seeing is not a lot of hospitalization and death that is mercifully changed a little bit. I think that's in part. Due to 2 factors, the virus has changed and the host has changed people that variously become.
Well what the World is seeing is not a lot of hospitalization and death.
That is mercifully chain.
Changed a little bit I think that's in part due to two factors the virus has changed.
And the host has changed.
The third is fully become.
Speaker 4: more immune experienced either through natural infection or through multiple vaccinations or both. And then the virus has sort of twisted and turned into one form of Omicron or another. And now the result of that is you see much less hospitalization and death. In fact, I think Gilead had a high risk study.
More.
<unk> experienced either through natural infection or through multiple vaccinations or both.
And then the virus sort of twisted and turned into one form of omicron or another.
And now the result of that as you see much less hospitalization and death in fact.
Gilead had a high risk study.
Speaker 4: running in phase three, and they recently stopped that study due to challenges in recruiting.
Running in phase three and they recently.
Stop that study.
Due to challenges.
<unk> and recruiting so.
Speaker 4: I think it's fair to say, you know, summing everything up, you know, looking at the.
I think it's fair to say summing everything up.
At the.
Speaker 4: know, the background of the patient population as well as thinking about how you register a drug. The most expedient straightforward path is probably in standard risk patients.
The background of the patient population as well as thinking about how you Register a drug.
The most expedient straightforward path is probably in standard risk patients.
Speaker 4: Um, and then, um, you know, trying to build on that as you, as you go and ultimately, um, get more kinds of patient.
And then.
Trying to build on that as you.
As you go ultimately.
More kinds of patients.
Speaker 4: into studies, but I think focusing on high-risk itself right now is a more challenging proposition.
Into studies, but I think focusing on high risk itself right now is a more challenging proposition.
Okay.
Thank you.
One moment please.
Speaker 1: I'm showing no further questions at this time. Let's turn the call back over to Jennifer Vieira for any closing remarks.
I'm showing no further questions at this time I will turn the call back over to Jennifer <unk> for any closing remarks.
Speaker 2: Thank you, operator and thanks everyone for joining us today. If you have additional questions, feel free to contact us by email or calling the office. Thanks and have a great night.
Thank you operator, and thanks, everyone for joining US today, if you have additional questions feel free to contact us by E mail or calling the office, thanks and have a great night.
Speaker 1: Thank you. Ladies and gentlemen, this does conclude today's conference. You may now disconnect. Have a great day.
Thank you ladies and gentlemen, this does conclude today's conference you may now disconnect have a great day.
Okay.
[music].
Okay.
Okay.