Q1 2024 Arrowhead Pharmaceuticals Inc Earnings Call
Operator: Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call. Throughout today's recorded presentation, all participants will be in a listen-only mode.
Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call throughout today's recorded presentation, all participants will be in a listen only mode. After the presentation, there will be an opportunity to ask questions.
Operator: After the presentation, there will be an opportunity to ask questions. I will now hand the conference call over to Vince Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.
I'll hand, the conference call over to Vince Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead Vince.
Vince Anzalone: Thank you, Amy. Good afternoon, everyone, and thank you for joining us today to discuss Arrowhead's results for its fiscal 2024 first quarter, ended December 31, 2023. With us today for management are President and CEO, Dr. Chris Anzalone, who will provide an overview of the quarter. We also welcome back Dr. Bruce Gibbon, who previously served as Arrowhead's Chief Operating Officer and Head of R&D and who has rejoined the company on an interim basis as Chief Medical Scientist. Bruce will provide an update on our cardiometabolic programs. Dr. James Hamilton, our Chief of Discovery and Translational Medicine, will provide an update on our earlier stage programs, and Ken Muskowski, our Chief Financial Officer, will give a review of the financials. In addition, Patrick O'Brien, our Chief Operating Officer and General Counsel, will be available during the Q&A portion of the call.
Vince Anzalone: Thank you Amy good afternoon, everyone and thank you for joining us today to discuss arrowheads results for its fiscal 2020 for first quarter and then just.
Vince Anzalone: 30, <unk> 2023 with US today from management are president and CEO, Dr. Christian Anzalone, who will provide an overview of the quarter. We also welcome back Dr. Bruce given who previously served as arrowheads, Chief operating officer, and head of R&D and who has rejoined the company on an interim basis as chief medical scientist.
Vince Anzalone: Bruce will provide an update on our cardio metabolic pipeline Dr. James Hamilton, our chief of Discovery and translational medicine will provide an update on our earlier stage programs and Ken Moskovsky, Our Chief Financial Officer will give a review of the financials.
Vince Anzalone: In addition, Patrick O'brien, our Chief operating Officer, and General Counsel will be available during the Q&A portion of the call before we begin I would like to remind you that comments made during today's call contains certain forward looking statements within the meaning of section 27.
Vince Anzalone: Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact are forward-looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statement.
Vince Anzalone: Of the Securities Act of 1933 and section 21 E of the Securities Exchange Act of 1934, all statements other than statements of historical fact are forward looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward looking statements.
Vince Anzalone: For further details concerning these risks and uncertainties, please refer to our SEC file, including our most recent annual report on Form 10-K and our quarterly reports on Form 10-Q. I'd now like to turn the call over to Chris Angeloni, President and CEO of the company. Thanks, Vince.
Vince Anzalone: For further details concerning these risks and uncertainties. Please refer to our SEC filings, including our most recent annual report on Form 10-K, and Form 10-K, and our quarterly reports on Form 10-Q.
Vince Anzalone: I'd now like to turn the call over to Chris Anzalone, President and CEO of the company Chris.
Chris Anzalone: Good afternoon, everyone, and thank you for joining us today. Arrowhead has made a name for itself as a company capable of rapid innovation and development that is building a broad-based, diverse business. This is exemplified by our 20 and 25 initiatives, where we expect to grow our pipeline of RNAi therapeutics to at least 20 clinical stage or marketed products by the year 2025. This commitment to creating a large number of new medicines as quickly as we can speaks to our dual mandate to maximize the number of patients we can help and to maximize our ability to create durable value for our shareholders. These mandates can be entirely aligned during early development.
Chris Anzalone: Thanks Vince.
Chris Anzalone: Good afternoon, everyone and thank you for joining us today.
Chris Anzalone: Everyone have made a name for itself as a company capable of rapid innovation and development that is building a broad based diverse business.
Chris Anzalone: Exemplified by our 2020 five initiatives, where we expect to grow our pipeline of <unk> therapeutics to at least 20 clinical stage or marketed products by the year 2025.
Chris Anzalone: This commitment to creating a large number of new medicines as quickly as we can speaks to our dual mandate to maximize number of patients. We can help to maximize our ability to create durable value for our shareholders.
Chris Anzalone: These mandates can be entirely aligned during early development, we decreased biology risk by focusing on well validated targets and our proven delivery and our proven delivery platforms. At this stage the cost of discovery and early development are relatively low, particularly when considering the potential value we can create with novel medicines.
Chris Anzalone: We decrease biological risk by focusing on well-validated targets and our proven delivery platforms. At this stage, the costs of discovery and early development are relatively low, particularly when considering the potential value we can create with novel medicines. In short, we can do many things at this stage without spending too much money and without building large teams with deep therapeutic area expertise. However, as our pipeline grows and we enter later stage expensive and complex clinical studies requiring significant capital, deeper domain expertise, and ultimately commercial infrastructure, we need to prioritize what we do internally. That is where we are now, and we are currently building out late stage development and commercial infrastructure to serve the cardiometabolic vertical. This is the primary engine of our near-term value proposition.
Chris Anzalone: In short we can do many things at this stage without spending too much money and without building large teams with deep therapeutic area expertise. However, as our pipeline grows and we enter later stage expensive and complex clinical studies, requiring significant capital deeper domain expertise and ultimately commercial infrastructure, we need to prioritize what we do.
Internally.
Chris Anzalone: That is where we are now and we are currently building out late stage development and commercial infrastructure to serve the cardio metabolic vertical.
Chris Anzalone: This is the primary engine of our near term value proposition, we expect to follow that up and add a pulmonary vertical as our long targeted platform through candidates mature and we have the data we need to make a commitment to build out specialized commercial infrastructure.
Chris Anzalone: We expect to follow that up and add a pulmonary vertical as our lung-targeted platforms and candidates mature, and we have the data we need to make a commitment to build out specialized commercial infrastructure. But does this mean that we will slow down or stop early development outside our focus areas? No, it does not.
Chris Anzalone: So does this mean that we will slow down or stop early development outside our focus areas. It does not we will continue to develop new candidates outside these verticals because we have confidence in our ability to find appropriate partners to continue development and commercial programs that are non core for us and B, we anticipate adding new verticals in the future. Thank.
Chris Anzalone: We will continue to develop new candidates outside these verticals because, A, we have confidence in our ability to find appropriate partners to continue developing and commercializing programs that are non-core for us, and, B, we anticipate adding new verticals in the future. Think of this part of our business as generating capital to support our internal programs and as a farm system to create additional focus areas that could create long-term value as platforms and candidates mature. Let's start with our cardiometabolic vertical.
Chris Anzalone: Think of this part of our business is generating capital to support our internal programs and as a farm system to create additional focus areas that could create long term value as platforms and candidates mature.
Chris Anzalone: Let's start with our cardio metabolic vertical.
Chris Anzalone: Our lead program is Plozacaran, which targets apolipoprotein C3 or ApoC3. This is potentially a big year for Plozacaran and for the cardiometabolic vertical broadly. The Palisade Phase 3 study of plazaceran in patients with genetically or clinically confirmed familial chylomicronemia syndrome, or FCS, is on schedule for the last patient to have their last study visit in the second quarter of this year. This would be the first complete phase three data set for Arrowhead that potentially would allow us to file our first NDA and launch our first commercial product. FCS is a severe disease in which patients have extraordinarily high triglyceride levels, often in the thousands of milligrams per deciliter.
Chris Anzalone: Our lead program is <unk>, <unk>, which targets a blip of protein three or <unk>. Three this was potentially a big year for <unk> and for the cardio metabolic vertical broadly.
Chris Anzalone: The palisade phase III study of <unk> in patients with genetically are clinically confirmed familiar Ocala Micronesia syndrome, or FCS is on schedule for the last patient to have their last study visit in the second quarter of this year.
Chris Anzalone: This would be the first complete phase III dataset for arrowhead that potentially would allow us to file our first NDA and launch our first commercial product.
<unk> is a severe disease in which patients have extraordinarily high triglyceride levels often in one thousands of milligrams per deciliter. Many of these patients experience painful recurrent bouts of severe abdominal pain pancreatitis and hospitalization.
Chris Anzalone: Many of these patients experience painful and recurrent bouts of severe abdominal pain, pancreatitis, and hospitalization. These patients have inadequate treatment options, and we believe Plozaseran could represent a significant leap forward. We see the data from the phase two studies as compelling. Podacerin has been generally well-tolerated and consistently did what it was designed to do.
Chris Anzalone: These patients these patients have inadequate treatment options and we believe that <unk> could represent a significant leap forward, we see the data from the phase II studies is compelling pedestrian has been generally well tolerated and consistently did what it was designed to do we have a high degree of confidence that this will be a powerful drug for this patient population with very.
Chris Anzalone: We have a high degree of confidence that this will be a powerful drug for this patient population with very high unmet medical needs. We believe Plozacerin could also help a broader population of patients. Therefore, we plan to initiate phase three studies in patients with severe hypertriglyceridemia or SHTD. These studies will likely begin next quarter and are aimed at addressing a larger patient population that we believe totals three to four million in the U.S. alone. As with the FCS population, our Shasta 2 study gives us confidence that Plozaseran will do exactly what it is designed to do. We believe it will be a powerful and welcome leap forward for patients. Bruce will discuss study designs for SHTG in a moment.
Chris Anzalone: High unmet medical needs.
Chris Anzalone: We believe pedestrian could also help a broader population of patients. Therefore, we plan to initiate phase III studies in patients with severe hypercholesterolemia hypercholesterolemia or S. H T G <unk>.
Chris Anzalone: These studies will likely begin next quarter and are aimed at addressing a larger patient population that we believe totals $3 million to $4 million in the U S alone.
Chris Anzalone: As with the FCS population, our Shasta two study gives us confidence that <unk> will do exactly what it is designed to do.
Chris Anzalone: We believe it will be a powerful and welcome to leap forward for patients Bruce will discuss study design for <unk> in a moment.
Chris Anzalone: We are still considering whether we also want to study plazaceran in the broader atherosclerotic cardiovascular disease (or ASCVD) population, but we have not yet made a final decision on that. We will be completing our analysis this quarter and will communicate our plans after they are finalized. And we have had some regulatory interaction. If our cardiometabolic vertical represents the foundation of our value problem, Plazacaran is the bedrock of that foundation for the following reasons.
Bruce: We are still considering whether we also want to study <unk> in the broader atherosclerotic cardiovascular disease or CBD population, but have not yet made a final decision on that we will be completing our analysis this quarter and will communicate our plans. After they are finalized and we have had some regulatory interactions.
Bruce: If our cardio metabolic vertical represents the foundation of our value proposition <unk> is the bedrock of that foundation for the following reasons.
Chris Anzalone: The target, ApoC3, is well validated across a variety of genetic studies. Our data across hundreds of human subjects indicates consistent target engagement with deep and durable ApoC3 silencing. Triglyceride levels were deeply reduced in patients and healthy volunteers treated with Plogasiran. We know that elevated triglyceride levels in certain patient populations can lead to severe abdominal pain, acute pancreatitis, hospitalizations, and other difficult downstream effects, and even, in rare cases, death.
Bruce: The target <unk> three is well validated across a variety of genetic studies.
Our data across hundreds of human subjects indicates consistent target engagement with deep and durable apoc III silencing.
Bruce: Triglyceride levels were deeply reduced and patients and healthy volunteers treated with <unk>.
Bruce: We know the elevated triglyceride levels in certain patient populations can lead to severe abdominal pain acute pancreatitis hospitalizations and other difficult downstream effects and even in rare cases deaths.
Bruce: There is currently no FDA approved therapy that lowers triglycerides by more than 20 or 30% <unk> has been generally well tolerated in prior studies.
Chris Anzalone: There is currently no FDA-approved therapy that lowers triglycerides by more than 20 or 30 percent, and plazacerin has been generally well-tolerated in prior studies. Together, these set up an attractive opportunity; we just need to get to market. We expect to launch Plozacaran as early as next year in FCS, and we would hope to follow that relatively quickly by launching into larger SHTG markets. And we will see if we follow that with the even larger ASCBD markets. This brings me next to Zodaciran, which targets angiopoietin-like protein 3, or AngPTL3.
Bruce: Together these set up an attractive opportunity, we just need to get to market, we expect to launch with aster and as early as next year in FCS, We would hope to follow that relatively quickly by launching into larger <unk> markets.
Bruce: And we will see if we followed that with even larger CBD market.
Bruce: This brings me next to <unk>, <unk>, which targets angiopoietin like protein three or <unk> three <unk>.
Bruce: As we've discussed we are assessing both the <unk> and to determine which may be better suited for investment in a cardiovascular outcome study in patients with CBD.
Bruce: The data we presented at <unk> in November <unk>, and the ability to reduce remnant cholesterol, which is believed to be a major contributor to the residual risk of CBD. After LDL cholesterol as well controlled was very encouraging.
Chris Anzalone: As we discussed, we are assessing both zodaceran and plazaceran to determine which may be better suited for investment in a cardiovascular outcome study in patients with ASCVD. The data we presented at AHA in November on Zidaceran's ability to reduce remnant cholesterol, which is believed to be a major contributor to the residual risk of ASCVD after LDL cholesterol is well controlled, were very encouraging. In fact, we have not seen any other therapy capable of the type of reductions seen after Zidaceran treatment in the Phase II study.
Bruce: In fact, we have not seen any other therapy capable of the type of reductions seen after that ASUR and treatment in the phase II study.
Bruce: Thats available drugs have shown only modest lowering of triglycerides available therapies have similarly produced only modest reductions in remnant cholesterol.
Bruce: So <unk> has also shown promising results in our phase II study in patients with homozygous familial hypercholesterolemia or <unk>. We're currently preparing materials for an end of phase two meeting with the FDA and intend to begin a phase III study in HR page. After we have regulatory feedback on our plans.
Chris Anzalone: Just as available drugs have shown only modest lowering of triglycerides, available therapies have similarly produced only modest reductions in remnant cholesterol. Thus, Dasaran has shown promising results in a phase two study in patients with homozygous familial hypercholesterolemia, or HOFH. We're currently preparing materials for an end of phase two meeting with the FDA and intend to begin a phase three study in HOFH after we get regulatory feedback on our plan. We could also expand into the much larger heterozygous or HEFH population. If we decide to conduct a Phase III study of Zodiaceran in ASCBD, the commercial plan will likely follow a similar path as Plozaceran. That plan is to launch the vaccine in a rare population and continue to build out commercial infrastructure and capabilities to support larger patient populations while the additional phase three studies are being conducted.
Bruce: We could also expand into the much larger heterozygous FH population.
Bruce: If we decided to conduct a phase III study of <unk> and in our CBD. The commercial plan will likely follow a similar path as close as around that plan is to launch in a rare population and continue to build out commercial infrastructure and capabilities to support larger patient populations, while the additional phase III studies are being conducted crystal.
Bruce: SRM that could mean addressing the small HOS age population relatively quickly and expanding into <unk> and ultimately the very large CBD market as we get each approval.
Bruce: This path makes a lot of sense for us as an emerging commercial company and will allow us to grow in a measured step wise fashion.
Bruce: We believe that those ASUR and <unk>, clearly warrants investment into cardio metabolic infrastructure.
Speaker Change: Im sorry, cardiome about commercial infrastructure.
Speaker Change: Those outlays become increasingly cost efficient as we increase the number of drugs that infrastructure manages therefore, it makes sense to expand the cardio metabolic vertical to include additional complementary medicines in the portfolio and we have several in mind.
Chris Anzalone: For Sidazoram, that could mean addressing the small HOFH population relatively quickly, then expanding into HEFH and ultimately the very large ASCVD market as we get each approval. This path makes a lot of sense for us as an emerging commercial company and would allow us to grow in a measured stepwise fashion. We believe that Plovaceran and Zodaceran clearly warrant investment in cardiometabolic infrastructure.
Speaker Change: One is based on our adipose targeting trim platform, which has shown impressive preclinical data we are seeing target gene silencing with this platform in excess of 90%. After a single dose in animal models with the activity that lasted over six months.
Speaker Change: Adipose tissue as the largest endocrine organ in the body and there are multiple attracted metabolic targets that may be amenable to an <unk> based knockdown strategy.
Chris Anzalone: Those outlays become increasingly cost-efficient as we increase the number of drugs that the infrastructure manages. Therefore, it makes sense to expand the cardiometabolic vertical to include additional complementary medicines in the portfolio, and we have several in mind. One is based on our Adipose Targeting Trim Platform, which has shown impressive preclinical data. We have seen target gene silencing with this platform in excess of 90% after a single dose in animal models, with activity that lasted over six months. Adipose tissue is the largest endocrine organ in the body, and there are multiple attractive metabolic targets that may be amenable to an RNAi-based knockdown strategy.
Speaker Change: We're not prepared to disclose the first gene target we are addressing but it is in the metabolic space.
Speaker Change: Another program, we are adding to the cardio metabolic vertical is arrow in HPE.
<unk> utilizes the liver targeted trim platform and targets the iron HPE gene, which encodes inhibits sub unit beta E. James will talk about the target in a moment, but the intention is to study this in obesity and metabolic disease population.
Speaker Change: Both programs, but well in our cardio metabolic vertical and our unscheduled for Cta filings as early as the end of this year.
Speaker Change: It is difficult to overstate the importance of our cardio metabolic vertical and driving our value proposition.
Speaker Change: Have near term commercial opportunities <unk> ran a high expectation of success surrounding the programs and longer term opportunities with future drug candidates.
Chris Anzalone: We are not prepared to disclose the first gene target we are addressing, but it is in the metabolic space. Another program we are adding to the cardiometabolic vertical is Arrow INHBE. This utilizes the liver-targeted TRIM platform and targets the INHBE gene, which encodes the inhibin subunit beta-E. James will talk about the target in a moment, but the intention is to study this in an obesity and metabolic disease population.
Speaker Change: The next vertical we expect to invest in late stage clinical studies and commercialization is pulmonary.
Speaker Change: There are only about 16000 pulmonologists in United States, and we believe it's an attractive prospect to build a specialized commercial sales organization to support a growing pipeline of medicines that addresses various respiratory diseases. We currently have three programs in clinical studies are collectively address three major components of chronic lung disease inflammation <unk> obstruction.
Chris Anzalone: Both programs fit well in our cardiometabolic vertical and are on schedule for CTA filings as early as the end of this year. It is difficult to overstate the importance of our cardiometabolic vertical in driving our value proposition. We have near-term commercial opportunities for Plozacaran and Zodacaran, a high expectation of success surrounding the programs, and longer-term opportunities with future drug candidates. The next vertical we expect to invest in late-stage clinical studies and commercialization is lung. There are only about 16,000 pulmonologists in the United States, and we believe it's an attractive prospect to build a specialized commercial sales organization to support a growing pipeline of medicines that address various respiratory diseases. We currently have three programs in clinical studies that collectively address three major components of chronic lung disease. Inflammation, mucoobstruction, and interstitial lung disease.
Speaker Change: And interstitial lung disease.
Speaker Change: We also see a pulmonary space is a target rich environment, where we believe we can advance and ultimately bring to market a number of different drugs for various diseases treated by a relatively small number of physicians, we like the leverage this creates.
The current program the current programs and clinical studies, our Aero Rage, Aramark, five AC and Aero MMP seven.
Speaker Change: We expect to have multiple clinical readouts for these programs this year and intend to start at least one phase II study in <unk> in 2024, we also expect additional targets potentially this year.
Cardio metabolic and pulmonary or where we are focusing a lot of our attention and will represent quite a bit of our spend moving forward.
Speaker Change: So what does that mean for the rest of our existing and future pipeline as.
Speaker Change: As I mentioned, we are not slowing down our discovery organization and will not limit growth in our early stage pipeline. For example in 2023, we nominated nine new clinical candidates and filed for new Cta's fees.
Chris Anzalone: We also see the pulmonary space as a target-rich environment where we believe we can advance and ultimately bring to market a number of different drugs for various diseases treated by a relatively small number of physicians. We like the leverage this creates. The current programs in clinical studies are Arrow RAGE, Arrow MUC5AC, and Arrow MMP7. We expect to have multiple clinical readouts for these programs this year and intend to start at least one phase two study in 2024. We also expect additional targets this year.
Speaker Change: These are promising programs. So the question is where do they fit strategically and what role do each play in our business.
Speaker Change: I think of three primary categories that the new programs can slot into.
Speaker Change: One new candidates that fit into existing verticals Arrow and HPE is a good example of this it fits neatly into the cardio metabolic vertical.
Speaker Change: Two new candidates that pending clinical proof of concept could warrant an expansion into a new vertical.
Speaker Change: Our work in CNS is very early but given the vast unmet medical needs in the broad target rich environment. This could be an area, we build out should clinical data support it and.
Chris Anzalone: Cardiometabolic and pulmonary are where we are focusing a lot of our attention and will represent quite a bit of our spend moving forward. So what does that mean for the rest of our existing and future pipelines? As I mentioned, we are not slowing down our discovery organization and will not limit growth in our early stage pipeline. For example, in 2023, we nominated nine new clinical candidates and filed four new CTAs. These are promising programs, so the question is where do they fit strategically and what role do each play in our business? I think of three primary categories that the new programs can slot into. One, new candidates that fit into existing verticals. Arrow INHPE is a good example of this.
Speaker Change: And three new candidates that are interesting from a medical and commercial standpoint, but may not fit into one of our verticals. This is an important category for us and can serve as a substantial source of capital to fund. The other two categories. We brought in close to $1 billion.
Speaker Change: And partnering capital over the past seven years, and we anticipate this will be increasingly important piece of our financing plan going forward as existing partnerships mature and we continue to do new deals.
Speaker Change: Our partnerships with our partnership with Amgen on old past Oran, formerly Aro LTA is a good example of what we can do after even a modest investment in discovery.
Speaker Change: In late 2016, when we partnered with Amgen Aero LTA was still an early preclinical program.
Speaker Change: Since then we've received around $362 million in cash and are still eligible to receive another $535 million in potential payments as certain clinical and commercial milestones are achieved.
Chris Anzalone: It fits neatly into the cardiometabolic vertical, but new candidates that, pending clinical proof of concept, could warrant an expansion into a new vertical. Our work in CNS is very early, but given the vast unmet medical needs and the broad target-rich environment, this could be an area we build out should clinical data support it. And three, new candidates that are interesting from a medical and commercial standpoint but may not fit into one of our verticals. This is an important category for us and can serve as a substantial source of capital to fund the other two categories. We have brought in close to a billion dollars in partnering capital over the past seven years.
Speaker Change: <unk>, we are eligible to receive $50 million when the El Paso and Phase III study is fully enrolled which Amgen recently publicly guided could be in the first half of this year.
Speaker Change: Business development is an important source of capital but of course, not the only source we will rely on.
Speaker Change: Last month, we announced a $450 million equity financing the first such deal we have done in approximately four years.
Speaker Change: <unk> was confidentially marketed to just a handful of funds and we were pleased with the result, it was substantially oversubscribed and saw terrific participation from high quality investors, we viewed that as the first step in substantially increasing our balance sheet.
Chris Anzalone: And we anticipate this will be an increasingly important piece of our financing plan going forward as existing partnerships mature and we continue to do new deals. Our partnership with Amgen on Old Pasaran, formerly Arrow LPA, is a good example of what we can do after even a modest investment in discovery. In late 2016, when we partnered with Amgen, Arrow LPA was still an early preclinical program. Since then, we have received around $362 million in cash and are still eligible to receive another $535 million in potential payments as certain clinical and commercial milestones are achieved. In fact, we are eligible to receive $50 million when the El Paso Rand Phase III study is fully enrolled, which Amgen recently publicly guided could be in the first half of this year.
Speaker Change: We expect the second step to be a structured finance transaction that could be based around has taken in capital in return for royalties on one of our future products that is capped at some return.
Speaker Change: This could also have a debt component to it we anticipate executing such a transaction in the coming months.
Speaker Change: We expect the third step to be one or more partnership transactions and while we cannot control. The exact timing of these our goal is to do one or more economically meaningful deals this year.
Speaker Change: <unk>, we expect these multiple steps to provide a strong financial base on which we may continue to invest in our core programs and new innovations.
Speaker Change: There is also a cost management side to creating a strong financial base as I discussed we have reached the point, where we need to be more strategic about that particular drug candidates, we take into late stage studies and ultimately to commercialization.
Speaker Change: It is simply not economically feasible to do everything on our own past a certain stage of development that.
Chris Anzalone: Business development is an important source of capital, but, of course, not the only source we will rely on. Last month, we announced a $450 million equity financing, the first such deal we have done in approximately four years. That transaction was confidentially marketed to just a handful of funds, and we were pleased with the result. It was substantially oversubscribed and saw terrific participation from high-quality investors.
Speaker Change: That means looking more vigorously for partners and potentially pausing or even calling some programs that are outside of our chosen verticals to that end. We've recently conducted a portfolio review.
Speaker Change: We are moving forward with clinical studies for our complement programs <unk> and <unk>.
Speaker Change: Our muscle targeted programs Arrow dux for an arrow deem one.
Speaker Change: We're continuing to assess clinical the clinical path and designing phase <unk> studies for our Nash candidate <unk> three.
Chris Anzalone: We view that as the first step in substantially increasing our balance. We expect the second step to be a structured finance transaction that could be based around taking in capital in return for royalties on one of our future products that is capped at some return. This could also have a debt component to it.
Speaker Change: The <unk> candidate HCN for $5 7 million, which was returned to us by Amgen. After its horizon acquisition is being terminated and will not move forward.
Speaker Change: In addition, aerostar one our CNS candidate against <unk> ALS will not move forward. We are continuing to work on additional CNS programs and expected new candidate against a different target to begin clinical studies later this year. It is more commercially attractive and Aero side one.
Chris Anzalone: We anticipate executing such a transaction in the coming months. We expect the third step to be one or more partnership transactions. And while we cannot control the exact timing of these, our goal is to do one or more economically meaningful deals this year. Together, we expect these multiple steps to provide a strong financial base on which we may continue to invest in our core programs and new innovations. There's also a cost management side to creating a strong financial base. As I discussed, we have reached the point where we need to be more strategic about the particular drug candidates we take into late stage studies and ultimately to commercialization. It is simply not economically feasible to do everything on our own past a certain stage of development.
Speaker Change: While still serving as a good proof of concept for the CNS platform.
Speaker Change: Our portfolio review also affected some undisclosed preclinical programs, we have revised our budget to reflect an anticipated reduction in growth of our spend over this fiscal year and beyond.
Speaker Change: Ken will talk about specifics in a moment, but we are reducing our guidance on fiscal year operating burn by approximately $100 million.
Speaker Change: We are achieving these estimates while importantly, continuing to fully fund our core pulmonary on cardio metabolic verticals and innovative new technologies and programs continue.
Speaker Change: Continuously assessing our anticipated uses and sources of capital and ensuring they alive that they align with the overall goals of the business is of course, a critical exercise I think our revised budget puts us in a stronger position strategically as well as financially.
Chris Anzalone: That means looking more vigorously for partners and potentially pausing or even culling some programs that are outside our chosen vertical. To that end, we've recently conducted a portfolio review. We are moving forward with clinical studies for our complement programs, Arrow C3 and Arrow CFB, and our muscle-targeted programs, Arrow DUX4 and Arrow DM1. We're continuing to assess the clinical path and designing Phase 1b, 2a studies for our NASH candidate, Arrow PNPLA-3. The gout candidate, HZN 457, which was returned to us by Amgen after its Horizon acquisition, is being terminated and will not move forward. In addition, Arrow SOD 1, our CNS candidate against SOD 1 ALS, will also not move forward.
Dr. Bruce: With that overview I'd now like to turn the call over to Dr. Bruce given Bruce.
Thank you, Chris and good afternoon, everyone.
It's great to be back, helping arrowhead move forward in the most effective and efficient way possible.
Bruce: I have been doing a good amount of work getting up to speed with the cardio metabolic clinical development teams, which are operating at a very high level.
Bruce: We are doing important design analysis work to ensure our studies a world class shortly.
Bruce: Shortly we will be Guinea centers initiated so additional phase III studies can get up and running rapidly.
Bruce: Chris mentioned that we are in the middle of a process to assess which program possess ran or Odessa, and we want to take forward into an <unk> population.
Chris Anzalone: We are continuing to work on additional CNS programs and expecting new candidates against a different target to begin clinical studies later this year. It is more commercially attractive than Arrow SOD 1, while still serving as a good proof of concept for the CNS platform. Our portfolio review also affected some undisclosed preclinical programs. We have revised our budget to reflect an anticipated reduction in growth of our spend over this fiscal year and beyond.
Speaker Change: And we have nothing new to update on that front today.
Speaker Change: So I will focus my time today on where we are with <unk> and the progress we've made.
Speaker Change: To review <unk> is designed to reduce production of Apoc III, a component of triglyceride, rich lipoproteins or <unk> and a key regulator of triglyceride metabolism.
Bruce Gibbon: Ken will talk about specifics in a moment, but we are reducing our guidance on fiscal year operating burn by approximately $100 million. We are achieving these estimates while, importantly, continuing to fully fund our core pulmonary and cardiometabolic verticals and innovative new technologies and programs. Continuously assessing our anticipated uses and sources of capital and ensuring that they align with the overall goals of the business is, of course, a critical exercise. I think our revised budget puts us in a stronger position strategically as well as financially. With that introduction, I'd now like to turn the call over to Dr. Bruce Gibbon. Bruce.
Speaker Change: Apoc III increases plasma triglyceride levels by inhibiting breakdown <unk> by lipoprotein lipase, an uptake of TRL remnants by hepatic receptors in the liver.
Speaker Change: We've studied <unk> in multiple clinical studies in different patient populations with several hundred patients having been dosed.
Speaker Change: We have been consistently encouraged by safety and Tolerability results with treatment emergent AD treatment emergent adverse events reported to date that generally reflect the comorbidities and underlying conditions of each study population.
Speaker Change: This is encouraging and consistent with our expectations of a properly designed RNA therapeutic that leverages, our proprietary <unk> platform.
Bruce Gibbon: Thank you, Chris, and good afternoon, everyone. It's great to be back helping Arrowhead move forward in the most effective and efficient way possible. I've been doing a good amount of work getting up to speed with cardiometabolic clinical development, which is operating at a very high level. We are doing important design and analysis work to ensure our studies are world-class. Shortly, we will be getting centers initiated so additional Phase 3 studies can get up and running rapidly. Chris mentioned that we are in the middle of a process to assess which program, Plozacaran or Zodacaran, we want to take forward into an ASCBD population, and we have nothing new to update on that front today. So I will focus my time today on where we are with Pozacaran and the progress we've made. To review, Pozaaciran is designed to reduce the production of ApoC3, a component of triglyceride-rich lipoproteins, or TRLs, and a key regulator of triglyceride metabolism. APOC3 increases plasma triglyceride levels by inhibiting the breakdown of TRLs by lipoprotein lipase and the uptake of TRL remnants by hepatic receptors in the liver.
Speaker Change: In addition, possessor Ann has demonstrated a high level of Pharmacodynamic activity with a mean maximum reduction in April three of around 90% give or take.
Speaker Change: Regardless of the patient population studied.
Speaker Change: This is also consistent with our expectations and speaks to the consistency of the <unk> mechanism.
Speaker Change: This was a hallmark of arrowhead candidates in our earlier days in the HBV and <unk> space and continues to be the case as we have developed new candidates targeting diverse genes.
Speaker Change: So, whereas <unk> going and what has changed over the last couple of months.
Speaker Change: First and most critically in the short term, we are making some changes to the proposed design of the suite of phase III <unk> studies for patients with <unk>.
Speaker Change: Our goal with these changes, which I will discuss in a moment is twofold first we want to accelerate enrollment and enable regulatory filings in the U S. Other key market as quickly as possible and.
Speaker Change: And second we want to maximize the probability to show an effect on severe abdominal pain and acute pancreatitis, which could be a significant differentiator from other triglyceride lowering therapies it could aid in value and access discussions with Payors.
Bruce Gibbon: We've studied plazacaran in multiple clinical studies in different patient populations, with several hundred patients having been dosed. We have been consistently encouraged by safety and tolerability results, with treatment emergent adverse events reported to date that generally reflect the comorbidities and underlying conditions of each study population. This is encouraging and consistent with our expectations of a properly designed RNAi therapeutic that leverages our proprietary trim platform. In addition, Plozacaran has demonstrated a high level of pharmacodynamic activity, with a mean maximum reduction in ApoC3 of around 90%, give or take, regardless of the patient population studied.
Speaker Change: So what are we doing towards those ends.
Speaker Change: Our plan was to conduct two similar phase III studies chefs, just three and chest for an approximately 700 patients with triglycerides greater than 500 milligrams per deciliter across the two studies combined with a primary endpoint of lowering triglycerides after one year of treatment.
Speaker Change: This general design remains largely unchanged, but we have streamlined several features of the study to potentially speed up time to NDA submission in Europe.
Speaker Change: The U S.
Speaker Change: We also intended to include a predefined number of patients.
Speaker Change: Higher risk of severe abdominal pain and acute pancreatitis events with the goal of potentially characterizing an expected reduction in risk of these events in <unk> patients treated with possessor in.
Speaker Change: This remains an important goal, but we believe the best way to assure ourselves of adequate power to show. This effect is to run a separate study designed specifically for that purpose.
Bruce Gibbon: This is also consistent with our expectations and speaks to the consistency of the RNAi mechanism. This was a hallmark of Arrowhead candidates in our earlier days in the HBV and AAT space and continues to be the case as we have developed new candidates targeting diverse genes. So, where is Plazastron going, and what has changed over the last couple months?
Speaker Change: This separate study will be called chefs to five and we will provide more details on the design sizing and inclusion criteria when we initiate the study.
Speaker Change: This separate study strategy could potentially do two things it gives us the best chance of showing a reduction in events versus placebo and second removing the predefined number of high risk patients as chefs to three and <unk> four is expected to further speed enrollment for these studies.
Bruce Gibbon: First, and most critically in the short term, we are making some changes to the proposed design of the suite of phase three Shasta studies for patients with SHTG. Our goal with these changes, which I will discuss in a moment, is twofold. First, we want to accelerate enrollment and enable regulatory filings in the U.S. and other key markets as quickly as possible. And second, we want to maximize the probability of showing an effect on severe abdominal pain and acute pancreatitis, which could be a significant differentiator from other triglyceride-lowering therapies and could aid in value and access discussions with payers. So what are we doing towards those ends? Our plan was to conduct two similar phase three studies, Shasta 3 and Shasta 4, in approximately 700 patients with triglycerides greater than 500 milligrams per deciliter across the two studies combined, with a primary endpoint of lowering triglycerides after one year of treatment. This general design remains largely unchanged.
Speaker Change: Between these changes in a handful of others. We estimate that we can get to full enrollment for chefs to three ish asked for more rapidly and potentially get to an NDA six to 10 months faster than the original planned.
This is a significant advance if our predictions are correct.
Speaker Change: We are actively working on getting these studies ready to go we asked we estimate shifted III in Chester four will begin next quarter in Chester five shortly thereafter.
Speaker Change: Possessor and has demonstrated best in class data at each prior step of the clinical development process. So we are eager to move more rapidly through these phase III studies.
Speaker Change: The next important event for <unk> is to completion and readout of the phase III Palisade study.
Speaker Change: This is in patients with genetically confirmed or clinically diagnosed familial chylomicron EMEA <unk> syndrome or Fcs.
Bruce Gibbon: But we have streamlined several features of the study to potentially speed up time to NDA submission in Europe and the US. We also intended to include a predefined number of patients at higher risk of severe abdominal pain and acute pancreatitis events with the goal of potentially characterizing an expected reduction in risk of these events in SHTG patients treated with plosacerone. This remains an important goal, but we believe the best way to assure ourselves of adequate power to show this effect is to run a separate study designed specifically for that purpose. This separate study will be called Shasta 5, and we'll provide more details on the design, sizing, and inclusion criteria when we initiate the study. This separate study strategy could potentially do two things. First, it gives us the best chance of showing a reduction in these events versus placebo.
Speaker Change: This is a severe disease of extremely high triglyceride levels that puts patients at high risk of episodes of severe abdominal pain or acute pancreatitis hospitalization and it can be fatal.
Speaker Change: There are no adequate treatment options for these patients.
Speaker Change: <unk> is a one year study with a primary endpoint of triglyceride lowering versus placebo.
Speaker Change: We enrolled 75 patients globally and the last patient is in is scheduled to have their last visit in may after that visit we will work quickly to complete sample analysis and data collection preparation and analyze the data we.
We intend to report topline results from this study in the third quarter and begin work toward filing arrowheads first NDA.
Speaker Change: That will likely be at the end of the year or into the first quarter of 2025.
Speaker Change: This is an exciting time and I'm thrilled to be back and to be part of this next big milestone for Arrowhead.
Bruce Gibbon: And second, removing the predefined number of high-risk patients in SHAFTA III and SHAFTA IV is expected to further speed enrollment for these studies. Between these changes and a handful of others, we estimate that we can get to full enrollment for Shasta 3 and Shasta 4 more rapidly and potentially get to an NDA six to 10 months faster than the original plan. This is a significant advance if our predictions are correct. We are actively working on getting these studies ready to go. We estimate that Shastra 3 and Shastra 4 will begin next quarter, and Shastra 5 shortly thereafter.
Speaker Change: I'll now turn the call over to Dr. James Hamilton Jacobs.
Speaker Change: Thank you Bruce.
Speaker Change: As you know we have a very robust pipeline of early clinical stage programs and even more even more robust pipeline of discovery stage programs, most of which we haven't disclosed yet.
Speaker Change: I want to talk about a few of the newer programs and give an update on where we are with some of the clinical programs that are approaching readouts.
Speaker Change: First Chris mentioned two programs that we're we've added to our cardio metabolic pipeline.
Bruce Gibbon: Plozasaran has demonstrated best-in-class data at each prior step of the clinical development process, and we're eager to move more rapidly through these phase 3 studies. The next important event for Plozasaran is the completion and readout of the Phase 3 Palisade Study. This is in patients with genetically confirmed or clinically diagnosed familial chylomicronemia syndrome, or FCS. This is a severe disease of extremely high triglyceride levels that puts patients at high risk of episodes of severe abdominal pain, acute pancreatitis, hospitalization, and it can be fatal. There are no adequate treatment options for these patients.
Speaker Change: One utilizes our new adipose delivery platform and the other utilizes our liver targeted platform.
We intend to talk more about the adipose platform program later in the year. So I will focus on the liver targeted program.
Speaker Change: This new liver targeted program is called Arrow inhibitor <unk>.
Speaker Change: <unk> is a gene that codes for a serum measurable protein active any which is primarily synthesized by the hepatocytes.
Speaker Change: Increased circulating activity levels.
Speaker Change: Signal adipose tissue to store excess nutrients as fat and.
Speaker Change: <unk> expression is increased in obesity and inhibiting <unk> loss of function variance identified in human genetic databases are protective of type two diabetes and are associated with reduced visceral fat and a reduced waste to hit ratio.
Bruce Gibbon: Palisade is a one-year study with a primary endpoint of triglyceride lowering versus placebo. We enrolled 75 patients globally, and the last patient is scheduled to have their last visit in May. After that visit, we will work quickly to complete sample analysis and data collection, preparation, and analysis of the data. We intend to report top-line results from the study in the third quarter and begin work toward filing Arrowhead's first NDA. That will likely be at the end of the year or into the first quarter of 2025. This is an exciting time, and I'm thrilled to be back and to be part of this next big milestone for Arrowhead. I'll now turn the call over to Dr. James Hamilton.
Speaker Change: We've conducted studies in mouse obesity models, we're inhibiting silencing with <unk> reduced weight gain by over 20% compared to controls.
Speaker Change: Importantly, the difference in weight gain was primarily due to changes in fat mass with no different scene and lean mass.
Speaker Change: We hope that inhibits <unk> therapeutic silencing could be an interesting adjunct to GOP <unk> agonists.
Speaker Change: We think the potential benefits of combination therapy could include the ability to use a lower dose of the GOP <unk> agonist, which might result in reduced lean mass loss reduced gastrointestinal side effects and prevention or slowing of weight regain post cessation of GOP <unk> agonists therapy.
James Hamilton: Thank you, Bruce. As you know, we have a very robust pipeline of early clinical stage programs and an even more robust pipeline of discovery stage programs, most of which we haven't disclosed yet. I want to talk about a few of the newer programs and give an update on where we are with some of the clinical programs that are approaching readout. First, Chris mentioned two programs that we've added to our cardio metabolic pipeline. One utilizes our new adipose delivery platform, and the other utilizes our liver-targeted platform. We intend to talk more about the Adipose Platform Program later in the year, so I will focus on the liver-targeted program. This new liver-targeted program is called Arrow Inhibin-E. Inhibin E is a gene that codes for a serum measurable protein, activin E, which is primarily synthesized by the hepatocyte. Increased circulating activity levels signal adipose tissue to store excess nutrients as fat.
Speaker Change: We have selected a clinical lead and are on schedule to file a cta by the end of 2024.
Speaker Change: Moving on to our two muscle targeted programs Aero dux for for patients with fascia, scapulohumeral muscular dystrophy, or Fsh D and DM one for patients with type one my atonic dystrophy or <unk>.
Speaker Change: Both of these programs are in phase one to a dose escalating studies to evaluate the safety Tolerability and PK PD profiles of single and multiple ascending doses.
Speaker Change: Both studies have ethics, and regulatory clearance to initiate and we expect the first patient in for both in Q1 or Q2 of this year.
Speaker Change: To review <unk> four is designed to target the gene that encodes human double Columbia box for dux for protein as a potential treatment for patients with Fsh D.
James Hamilton: Inhibiny expression is increased in obesity, and inhibiny loss of function variance identified in human genetic databases is protective of type 2 diabetes and is associated with reduced visceral fat and a reduced waist-to-hip ratio. We've conducted studies in mouse obesity models where inhibiny silencing with sRNA reduced weight gain by over 20% compared to controls. Importantly, the difference in weight gain was primarily due to changes in fat mass, with no difference seen in lean mass.
Speaker Change: <unk> is an autosomal dominant disease associated with the failure to maintain complete epigenetic.
Speaker Change: Suppression of <unk>, four expression and differentiated skeletal muscle.
Over expression of <unk>, four is myotoxic and can lead to muscle degeneration.
Speaker Change: <unk> is designed to reduce expression of the <unk> protein kinase or DNP caging.
Speaker Change: <unk> is the most common adult onset muscular dystrophy and there is currently no approved disease modifying therapy.
James Hamilton: We hope that inhibin-E therapeutic silencing could be an interesting adjunct to GLP-1 agonist therapy. We think the potential benefits of combination therapy could include the ability to use a lower dose of the GLP-1 agonist, which might result in reduced lean mass loss, reduced gastrointestinal side effects, and prevention or slowing of weight regain post cessation of GLP-1 agonist therapy. We have selected a clinical lead and are on schedule to file a CTA by the end of 2024. Moving on to our two muscle-targeted programs, AeroDUX4 for patients with fascioscapular humeral muscular dystrophy, or FSHD, and AeroDM1 for patients with type 1 myotonic dystrophy, or DM1. Both of these programs are in phase 1, 2A dose escalating studies to evaluate the safety, tolerability, and PK, and PD profiles of single and multiple ascending doses.
Speaker Change: I also want to give a status update on our two complement programs at the end of last year, we filed a cta to begin a phase one two study of <unk> for the treatment of various complement mediated diseases, and possibly geographic atrophy or <unk>.
<unk> is designed to reduce hepatic expression of complement factor B, which has been identified as a promising therapeutic target.
Our preclinical studies have demonstrated that <unk> can achieve deep and durable reductions in liver protein deliver production of complement factor B, which plays a key role in the activation of the alternative complement pathway involved in the pathogenesis of renal diseases, such as Iga nephropathy as well as us.
Speaker Change: Their conditions like Georgia.
James Hamilton: Both studies have ethics and regulatory clearance to initiate, and we expect the first patient in for both in Q1 or Q2 of this year. To review, Arrow Dux4 is designed to target the gene that encodes human double homeobox4, or Dux4 protein, as a potential treatment for patients with FSHD. FSHD is an autosomal dominant disease associated with the failure to maintain complete epigenetic suppression of ducts for expression in differentiated skeletal muscle. Overexpression of DUX4 is myotoxic and can lead to muscle degeneration. Arrow DM1 is designed to reduce the expression of the dystrophia myotonica protein kinase, or DMPK gene.
Speaker Change: We anticipate the first patient in for the Phase one two study will occur in Q2 of this year.
Speaker Change: Our more advanced complement program is <unk> three.
Speaker Change: As you May recall <unk> is designed to reduce production of complement component three or <unk> three as a potential therapy for various complement mediated diseases.
Speaker Change: We previously presented data from our part one from part one of the study in healthy volunteers and ongoing phase one two study that demonstrated the following promising results.
Speaker Change: Most dependent reduction in serum <unk>, three with 88% mean reduction at the highest dose tested.
Speaker Change: A dose dependent reduction in AAV 50, a marker of alternative complement pathway hemolytic activity with 91% mean reduction at the highest dose tested and duration of pharmacologic effect supportive quarterly or less frequent subcutaneous dose administration.
James Hamilton: DM1 is the most common adult-onset muscular dystrophy, and there is currently no approved disease-modifying therapy. I also want to give a status update on our two complementary programs. At the end of last year, we filed a CTA to begin a Phase 1-2 study of Arrow CFB for the treatment of various complement-mediated diseases and possibly geographic atrophy (GA). Arrow CFB is designed to reduce hepatic expression of complement factor B, which has been identified as a promising therapeutic target. Our preclinical studies have demonstrated that Arrow CFB can achieve deep and durable reductions in liver production of complement factor B, which plays a key role in the activation of the alternative complement pathway involved in the pathogenesis of renal diseases such as IgA nephropathy, as well as other conditions like GA. We anticipate that the first patient in for the Phase 1-2 study will occur in Q2 of this year.
Speaker Change: These results made us confident to move on to part two in patients with Iga nephropathy and <unk>.
Speaker Change: We are currently enrolling that part of the study and intend to present patient data around year end 2024.
Speaker Change: Lastly, the three clinical stage pulmonary programs continue to progress efficiently and are all on schedule for clinical Readouts. This year.
Speaker Change: <unk> pulmonary programs are as follows.
Speaker Change: Ara Rage, which is designed to reduce expression of the receptor for advanced communication and products or rage as a potential treatment for inflammatory pulmonary diseases.
Speaker Change: For the phase one two study we are fully enrolled and dosed all healthy volunteer cohorts in the mild to moderate asthma patient cohorts as well.
Speaker Change: We should have additional PD data by the end of the first quarter for both of these.
Speaker Change: We are also in the process of enrolling three cohorts of asthma patients with high baseline levels of fractional exhaled nitric oxide or <unk>, which is a biomarker for IL <unk> 13, driven type two inflammation into alone.
James Hamilton: Our more advanced complement program is Arrow C3. As you may recall, Arrow C3 is designed to reduce production of complement component 3, or C3, as a potential therapy for various complement-mediated diseases. We previously presented data from our Part 1 of the study in Healthy Volunteers, an ongoing Phase 1-2 study that demonstrated the following promising results: a dose-dependent reduction in serum C3 with 88% mean reduction at the highest dose tested.
Speaker Change: We believe we will have initial results from these high female cohorts in the third quarter of this year.
Speaker Change: The biology of Rage, and where it sits in the inflammatory cascade as well as our own preclinical studies have suggested that <unk> inhibition may provide potent anti inflammatory effects that impacts with impacts on an array of cytokines, including IL 13, IL five <unk> IL 18.
James Hamilton: A dose-dependent reduction in AH50, a marker of alternative complement pathway hemolytic activity with a 91% mean reduction at the highest dose tested and duration of pharmacologic effect supportive of quarterly or less frequent subcutaneous dose administration. These results made us confident to move on to Part 2 in patients with IgA nephropathy and C3 glomerulopathy. We are currently enrolling that part of the study and intend to present patient data around year-end 2024. Lastly, the three clinical-stage pulmonary programs continue to progress efficiently and are all on schedule for clinical readouts this year. These pulmonary programs are as follows. Era Rage, which is designed to reduce expression of the receptor for advanced glycation end products, or RAGE, as a potential treatment for inflammatory pulmonary diseases.
Speaker Change: IL 33, IL <unk> and IL six.
Speaker Change: In addition to fino, we're assessing other potential biomarkers of anti inflammatory effect, including sputum and blood cytokines in the asthma patient cohorts.
Speaker Change: The next two programs our Aero Mach five AC which is designed to reduce production of mucin, five AC or <unk> as a potential treatment for mutual obstructive pulmonary diseases and Aero MMP, seven which is designed to reduce expression of matrix <unk> protein <unk> seven or <unk>.
Speaker Change: <unk> as a potential treatment for idiopathic pulmonary fibrosis or IPF.
Speaker Change: In both programs, we are conducting a phase one two studies in healthy volunteers and then in patients.
James Hamilton: For the Phase I-II study, we fully enrolled and dosed all healthy volunteer cohorts and the mild to moderate asthma patient cohorts as well. We should have additional PD data by the end of the first quarter for both of these. We were also in the process of enrolling three cohorts of asthma patients with high baseline levels of fractional exhaled nitric oxide, or FENO, which is a biomarker for IL-13-driven type 2 inflammation in the lung. We believe we will have initial results from these high-phenotype cohorts in the third quarter of this year. The biology of RAGE and where it sits in the inflammatory cascade, as well as our own preclinical studies, have suggested that RAGE inhibition may provide potent anti-inflammatory effects that impact an array of cytokines, including IL-13, IL-5, TSLP, IL-18, IL-33, IL-1B, and IL-6.
Speaker Change: Both programs require patient data to assess PD, Unlike <unk>, which has the benefit of a readily available and measurable PD biomarker in healthy volunteers.
Speaker Change: Both <unk> and Aero MMP seven have already enrolled in dose healthy volunteers and we anticipate the patient cohorts will be enrolled and dosed in time to enable initial clinical readouts in the second half of the year.
Speaker Change: I'll now turn the call over to Ken Moskovsky Ken.
Ken Moskovsky: Thank you James and good afternoon, everyone.
Ken Moskovsky: As we reported today, our net loss for the quarter ended December 31, 2023 was $132 9 million or $1 24 per share based on $107 4 million fully diluted weighted average shares outstanding.
Ken Moskovsky: This compares with a net loss of $41 3 million or <unk> 39 per share based on 106 million fully diluted weighted average shares outstanding for the quarter ended December 31 2022.
Ken Moskovsky: Revenue for the quarter ended December 31, 2023 was $3 6 million compared to $62 5 million for the quarter ended December 31 2022.
James Hamilton: In addition to pheno, we are assessing other potential biomarkers of anti-inflammatory effects, including sputum and blood cytokines in the asthma patient cohort. The next two programs are Arrow MUC5AC, which is designed to reduce production of mucin 5AC, or MUC5AC, as a potential treatment for mucobstructive pulmonary diseases, and Arrow MMP7, which is designed to reduce expression of matrix metalloproteinase 7, or MMP7, as a potential treatment for idiopathic pulmonary fibrosis, or IPF. In both programs, we are conducting phase one and two studies in healthy volunteers and then in patients. Both programs require patient data to assess PD, unlike Arrow Rage, which has the benefit of a readily available and measurable PD biomarker in healthy volunteers. Both Arrow Mach 5AC and Arrow MMP7 have already been enrolled in Dosed Healthy Volunteers, and we anticipate the patient cohorts will be enrolled and dosed in time to enable initial clinical readouts in the second half of the year. I will now turn the call over to Ken Muskowski. Ken
Ken Moskovsky: Revenue in the current period, primarily relates to our collaboration agreements with GSK on <unk>.
Ken Moskovsky: Revenue in the prior period, primarily related to recognition of revenue from our license and collaboration agreements with Takeda and Amgen.
Ken Moskovsky: All upfront payments from existing agreements have now been fully recognized.
Ken Moskovsky: Total operating expenses for the quarter ended December 31, 2023 were $140 1 million compared to $104 7 million for the quarter ended December 31 2022.
Ken Moskovsky: The key drivers of this change were increased candidate costs and salaries as the Companys pipeline of clinical candidates has increased and advance into later stages of development.
Ken Moskovsky: Net cash used by operating activities. During the quarter ended December 31, 2023 was $117 8 million compared with $75 5 million for the quarter ended December 31, two.
Ken Moskovsky: Turning to the.
Ken Moskovsky: The increase in cash used by operating activities is driven primarily by higher research and development expenses and a lower cash revenue in the period.
Ken Moskovsky: We have reviewed our cash forecast and would like to provide additional guidance on our expected cash burn.
For the next several quarters, we expect operating burn to be $80 million to $100 million per quarter.
Ken Moskovsky: Our footprint expansion is mostly complete with the final payments to be made over the next several months totaling about $70 million after which we expect capital expenditures to be nominal.
Ken Muskowski: Thank you, James, and good afternoon, everyone. As we reported today, our net loss for the quarter ended December 31st, 2023, was $132.9 million, or $1.24 per share, based on $107.4 million fully diluted weighted average shares outstanding. This compares with a net loss of $41.3 million, or $0.39 per share, based on 106 million fully diluted weighted average shares outstanding for the quarter ended December 31, 2022.
Ken Moskovsky: Breaking the operating burn a bit further our cash burn related to G&A has been about 10% of costs. So think of that as about $10 million of G&A each quarter, which is expected to grow slowly going forward as we continue to advance commercial.
Ken Moskovsky: Commercialization efforts.
Ken Moskovsky: We expect quarterly R&D expenditures to be about $80 million. This year, increasing modestly next year as our Registrational studies advance.
Ken Moskovsky: Turning to our balance sheet, our cash and investments totaled $220 3 million at December 31, 2023.
Ken Muskowski: Revenue for the quarter ended December 31st, 2023, was $3.6 million, compared to $62.5 million for the quarter ended December 31st, 2022. Revenue in the current period primarily relates to our collaboration agreements with GSK, while all revenue in the prior period primarily related to recognition of revenue from our license and collaboration agreements with Takeda and Amgen. All upfront payments from existing agreements have now been fully recognized.
Ken Moskovsky: Pro forma cash and investments accounting for the recent capital raise would be approximately $649 million.
Ken Moskovsky: Our common shares outstanding at December 31, 2023 were $107 5 million and pro forma shares outstanding.
Ken Moskovsky: Accounting for the capital raise would be $123 8 million.
Ken Moskovsky: With that overview I will now turn the call back to Chris.
Chris Anzalone: Thanks, Ken.
Chris Anzalone: This is an important year for Arrowhead and five primary areas first we expect a lot of activity within our cardio metabolic vertical.
Chris Anzalone: We will have our first phase III readout for <unk> and plan to file our first NDA.
Ken Muskowski: Total operating expenses for the quarter ended December 31st, 2023 were $140.1 million, compared to $104.7 million for the quarter ended December 31st, 2022. The key drivers of this change were increased candidate costs and salaries as the company's pipeline of clinical candidates both increased and advanced into later stages of development. Net cash used by operating activities during the quarter ended December 31st, 2023, was $117.8 million compared with $75.5 million for the quarter ended December 31st, 2022. The increase in cash used by operating activities is driven primarily by higher research and development expenses and lower cash revenue in the period.
Chris Anzalone: We plan to initiate several additional phase III studies in patient populations, including <unk>, <unk>, <unk> and potentially <unk> across two different drug candidates possess around Enzo Das arena.
Chris Anzalone: We also intend to expand the cardio metabolic vertical to include two additional candidates arrow and HPE and <unk> and an undisclosed adipose targeted candidate <unk>.
Chris Anzalone: We plan to have multiple clinical readouts in our pulmonary vertical across three different drug candidates and initiate at least one phase III study.
Chris Anzalone: Third we intend to continue to strengthen our balance sheet with a structured finance transaction and one or more business development transactions.
Chris Anzalone: Fourth.
Chris Anzalone: Our other clinical programs continue to move forward. These include continuing enrollment of the <unk> phase III study with Takeda.
Chris Anzalone: Amgen potentially completing enrollment of its phase III study will pass around progress in phase II studies in HBV with GSK progress in Phase II studies of GSK for <unk> hundred 99 zero in Nash.
Ken Muskowski: We have reviewed our cash forecast and would like to provide additional guidance on our expected cash burns. For the next several quarters, we expect our operating burn to be $80 to $100 million per quarter. Our footprint expansion is mostly complete, with the final payments to be made over the next several months, totaling about $70 million, after which we expect capital expenditures to be nominal. Breaking the operating burn a bit further, our cash burn related to GNA has been about 10% of cost. So think of that as about $10 million of GNA each quarter, which is expected to grow slowly going forward as we continue to advance commercialization efforts. We expect quarterly R&D expenditures to be about $80 million this year, increasing modestly next year as our registrational studies advance. Turning to our balance sheet, our cash and investments totaled $220.3 million at December 31, 2023.
Chris Anzalone: Planning for Phase II studies in <unk> and Arrow <unk> III.
Chris Anzalone: Progress in Phase one studies for our neuromuscular candidate <unk>, four and <unk> and progress in Phase one studies of our complement based candidates <unk>, 3% and Aero CFP.
Chris Anzalone: And fifth we are not done innovating as I mentioned, we expect to bring our first adipose targeted candidate to the clinic and initiate clinical studies for an undisclosed CNS candidate this year.
Speaker Change: Thanks for joining us today, and I would now like to open the call to your questions operator.
As a reminder to ask a question. Please press star one one on your telephone and wait.
For your name to be announced to withdraw your question. Please press star one again.
Speaker Change: We ask that you please limit yourself to one question and one follow up.
Speaker Change: Please stand by while we compile the Q&A roster.
Ken Muskowski: Pro forma cash and investments accounting for the recent capital raise would be approximately $649 million. Our common share is outstanding at December 31st, 2023, we're 107.5 million, and pro forma share is outstanding, accounting for the capital raise would be $123.8 million. With that overview, I will now turn the call back to Chris. Thanks, Ken.
Speaker Change: And our first question comes from Luca <unk> with RBC capital. Your line is open.
Luca: Oh, great. Thanks, so much for taking my question.
Luca: Quick one here, maybe James first on Pheno.
Luca: I know that the data for any high FICO cohort is in.
Luca: The third quarter. However, I was under the impression that you were planning to show us the data from the mild to moderate patient potentially ahead of that.
Luca: Is that no longer to plan and if so what drove that decision and then maybe second either Chris or Ken.
Chris Anzalone: First, we expect a lot of activity within our cardiometabolic space; we will have our first phase three readout for Plozacaran and plan to file our first NDA. We plan to initiate several additional phase three studies in patient populations, including HOFH, HEFH, SHTG, and potentially ASCBD across two different drug candidates, plodacaran and zodacaran. We also intend to expand the cardiometabolic vertical to include two additional candidates, Arrow INHBE and an undisclosed adipose target. Second, we plan to have multiple clinical readouts in our pulmonary vertical across three different drug candidates and initiate at least one phase two study. Third, we intend to continue to strengthen our balance sheet with a structured finance transaction and one or more business developments.
Speaker Change: I think this is the first time I'm hearing you directly talk to you about potentially using that.
Speaker Change: Given the broader macroeconomic environment and where the rates are why do you think that adding debt is the right strategic decision at this point. Thanks, so much.
Chris Anzalone: Sure Luca Thanks for the question I'll take the first one in the mild to moderate asthma patient cohorts, we didn't have a female cut off so it was sort of an all comers asthma.
Speaker Change: A series of cohorts.
Speaker Change: We just don't have the numbers I think in the top dose cohort, we have one patient with high Pheno. So just not not enough to make a call based on our present data based on that's why we're waiting for the <unk> cohorts.
Speaker Change: So even though.
Speaker Change: Interest rates are higher than they have been historically.
Speaker Change: That is certainly lower than our cost of equity capital and it's we think an important part of non dilutive financing. So that's why we're looking at that possibility and I think that we're at the stage of.
Chris Anzalone: Fourth, our other clinical programs continue to move forward. These include continuing enrollment in the disease or and phase three study with Takeda, Amgen potentially completing enrollment in its Phase 3 study of Alpacaran, and progress in Phase 2 studies in HBV with GSK.
Speaker Change: This company, where we can consider that we are close to commercialization that it makes sense I think to start <unk>.
Speaker Change: Exploring those options.
Speaker Change: Got it thanks, so much.
Speaker Change: Youre welcome.
Speaker Change: One moment for our next question.
Chris Anzalone: Progress in Phase 2 studies of GSK4532990 in NASH, planning for Phase 2 studies of Arrow PNPLA-3, and progress in Phase 1 studies for our neuromuscular candidates, Arrow Dux4 and Arrow DM1. And progress in Phase 1 studies of our complement-based candidates, Arrow C3 and Arrow CF2. And fifth, we are not done innovating. As I mentioned, we expect to bring our first adipose-targeted candidate to the clinic and initiate clinical studies for an undisclosed CNS candidate this year. Thanks for joining us today. And I would now like to open the call to your questions. Operator.
Speaker Change: Yeah.
Speaker Change: And our next question comes from Ted <unk> with Piper Sandler Your line is open.
Ted: Great. Thank you very much and thanks for the thorough I'll take him doing seven year.
Chemical ready for pilot phase data and again.
Ted: Fingers crossed assuming success based on the mechanism and the data you've shown in the past.
Ted: How do you start to think about.
Ted: The commercial build out for that indication.
Ted: Especially in the U S. Obviously, I know, it's not a huge indication, but it would be the company's first commercial buildout and then.
Ted: Partnerships is it something where you would envision seeking distribution partners overseas or what's sort of the thinking.
Operator: As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. We ask that you please limit yourself to one question and one follow-up. Please stand by while we compile the Q&A roster. And our first question comes from Luca EC from RBC Capital. Your line is open.
Speaker Change: Thanks, a ton.
Speaker Change: Thanks Ted.
Speaker Change: But we're really excited to make this transition and we're excited about seeing those data the phase II data were.
Speaker Change: Were compelling and so we are optimistic that those data are going to continue to look good.
Speaker Change: Look we like the way the way. This this transition into a commercial company as is panning out.
Luca EC: Oh, great. Thanks so much for taking my question. Two quick ones here. Maybe James first on phenome.
James Hamilton: I know the data for the high phenome cohort is in the third quarter. However, I was under the impression that you were planning to show us the phenome data from the mild to moderate patients potentially ahead of that. Is that no longer the plan? And if so, what drove that decision?
Speaker Change: We are not a commercial company right now and so it can be jarring.
Speaker Change: Can imagine of going from zero to a very large market that could be a bit to fuse and so we get to take us baby step if you will in Fcs.
Speaker Change: Way I the way I sort of segregate the triglyceride market is is there those genetically.
Chris Anzalone: And then maybe second, either Chris or Ken, I think this is the first time I'm hearing you directly talking about potentially using debt. Given the broader macroeconomic environment and where the rates are, why do you think that adding debt is the right strategic decision? Thanks so much.
Speaker Change: Defined FCS patients those patients are known the physicians, who treat them know where they are they are relatively easy to address you.
Speaker Change: Take one one step down if you will say patients who are not genetically Fcs, but have triglycerides over 880 and history of pancreatitis again, those those those patients are relatively well known and relatively easy to to address it is it is it is.
Chris Anzalone: In the mild to moderate asthma patient cohorts, we didn't have a pheno cutoff, so it was sort of an all-comers asthma series of cohorts, and we just don't have the numbers. I think in the top-dose cohort, we had one patient with high phenotype, so just not enough to make a call based on or present data based on. That's why we're waiting for the high pheno cohort. Yeah, so even though interest rates are higher than they have been historically, the cost of debt is certainly lower than our cost of equity capital.
Speaker Change: It is those populations that we will be addressing initially and so it's a nice entry if you will into commercial as we as we grow and as we continue the other base study the other phase III studies.
Speaker Change: It will be increasing our ability to go after those that is harder to find patients.
Triglyceride side, those patients who have triglycerides above 500, and who may not have history of pancreatitis.
Chris Anzalone: And it's, we think, an important part of non-dilutive financing. So that's why we're looking at that possibility. And I think that we're at the stage of this company where we can consider that. We are close to commercialization, but it makes sense, I think, to start exploring those options. Got it. Thanks so much.
That's a very large number we believe but it will take some education of the market and will take some some digging of course and so we've got extra time to what to develop our ability to do that so that's that's.
Speaker Change: Internationally we.
Speaker Change: We feel like we can we can handle the Fcs markets.
Operator: You're welcome. One moment for our next question, and our next question comes from Ted Tenthoff with Piper Sandler. Your line is open.
Speaker Change: In certain ex U S markets and so we intend to do that longer term.
Speaker Change: I would expect.
Speaker Change: For us to find.
Speaker Change: Good local partners for <unk>, we will see where we are with CBD with <unk> and alike, but but at least for <unk>. It would probably make some sense for us to find the right local partners.
Ted Tenthoff: Great. Thank you very much, and thanks for the thorough update. It's going to be an exciting year.
Chris Anzalone: You know, as you're getting ready for policy data, and again, fingers crossed, assuming success based on the mechanism and data you've shown in the past, how do you start to think about the commercial build-out for that indication, especially in the U.S., obviously? I know it's not a huge indication, but it would be the company's first commercial build-out. And then you discussed partnerships. Is this something where you would imagine seeking distribution partners overseas, or what's the thinking OUS? Thanks a ton.
Speaker Change: Other countries.
Speaker Change: Great. Thanks for the update.
Speaker Change: Youre welcome.
Speaker Change: One moment for our next question.
Speaker Change: And our next question comes from <unk> Yang <unk> with B Riley Securities. Your line is open.
Yang: Hey team thanks for taking our questions and good to have Bruce back on the call. So.
Yang: Sure.
Yang: The outcome drive consideration and deliberation solutions or not.
Yang: Bruce could you point to any mid and how this is informing correlation of DIR.
Chris Anzalone: Thanks, Ted. Yeah, boy, we're really excited to make this transition. We're excited about seeing the data. The phase two data were compelling. And so we are optimistic that those data are going to continue to look good. Look, we like the way this transition into a commercial company is panning out. You know, it can be jarring.
Speaker Change: <unk> accumulated lowering that informative and trade with outcomes I believe you in.
Speaker Change: Possibly another peer might be doing a similar exercise in coming months.
Speaker Change: And like you said there might be additional external partners in line as you look to.
Speaker Change: Do a structured financing process.
Speaker Change: Thank you Thompson.
Speaker Change: Following up after that.
Chris Anzalone: One could imagine going from zero to a very large market that could be a bit diffuse. And so we get to take this baby step, if you will, in FCS. You know, the way I sort of separate the triglyceride market is that there are those genetically defined FCS patients. Those patients are known. The physicians who treat them know where they are.
Speaker Change: Well, there's a lot of interest in the remnant cholesterol concept a lot of.
Speaker Change: Mendelian randomization data and other data pointing to.
Speaker Change: These.
Speaker Change: Remnant cholesterol as being highly atherogenic.
Speaker Change: And some of these analyses are even more atherogenic than.
Chris Anzalone: They're relatively easy to address. You take one step down, if you will, say patients who are not genetically FCS but have triglycerides over 880 and a history of pancreatitis. Again, those those those patients are relatively well-known and relatively easy to address. It is it is it is it is those populations that we will be addressing initially. And so it's a nice entry, if you will, into commercial. You know, as we grow and as we continue the other phase studies, the other phase three studies will be increasing our ability to go after those harder-to-find patients. You know, those on the triglyceride side, those patients who have triglycerides above 500 and who may not have a history of pancreatitis. That's a very large number, we believe.
ABB in LDL on a milligram per milligram basis.
Speaker Change: It's as yet.
Improvement in clinical trials, because frankly, there just haven't been good enough drugs for.
Speaker Change: <unk> knees and so it has been untestable they were waiting for the good drug to come along that you could you could test this remnant cholesterol hypothesis.
Speaker Change: In both.
Speaker Change: So deseret possessor Ed are really.
Speaker Change: Incredibly good drugs from a.
Speaker Change: Collagic perspective.
Speaker Change: They offer that opportunity and.
Speaker Change: It's not actually an easy choice between the two because they're there.
Speaker Change: Both.
Speaker Change: Equivalent and a lot of ways with respect to their ability to address that particular question.
Chris Anzalone: But we'll take some education of the market and we'll take some digging, of course. And so we've got extra time to to develop our ability to do that, so that that's what it is domestically and internationally.
Speaker Change: So I think it's.
Speaker Change: There is plenty of.
Speaker Change: Plenty of.
Speaker Change: Paper out there plenty of.
Speaker Change: Genetic studies that point us this way that give us reason.
Chris Anzalone: We feel like we can we can handle the FCS markets, you know, in certain ex-U.S. markets. And so we intend to do that longer term. I would expect us to find good local partners for S.H.T.G. You know, we'll see where we are with ASCVD, with AGFH, and the like. But, at least for S.H.T.G., it would probably make some sense for us to find the right local partners in other countries. Great Thanks for the update. You're welcome.
Speaker Change: Reason to be hopeful as a field, but alone as a company.
Speaker Change: But but ultimately we have to we have to prove it we have to use the old fashion thing, we have to actually do the clinical trials and prove it.
Speaker Change: Got it and then on the female HEICO James a high school and then that biomarker data will also be part of the CPU.
Operator: One moment for our next question, and our next question comes from Ya Yang, Mam Tani, with B. Riley Securities. Your line is open.
Speaker Change: <unk> could you just maybe talk to the significance of that in and broadly in Yoplait annuity type lanes that are amongst dive in.
Ya Yang Mam Tani: Hey team, thanks for taking our questions and good to have Bruce back on the call. So on the outcome trial consideration and deliberations for Zodaciran, Bruce, could you point to any meta-analysis informing correlation of PRL, percent reduction, or cumulative lowering that informs event rate with outcomes? I believe you and possibly another peer might be doing a similar exercise in the coming months. And, like you said, there might be additional external partners involved as you look to implement a structured financing process.
Speaker Change: Patient cohorts.
Speaker Change: You answer in assessing that and what's the relevance of that as you look to make some go no go decisions. This year, thanks for taking our questions.
Speaker Change: Sure right. So the the additional biomarker data specifically the cytokines I mentioned I think that those are an important piece of the readouts that.
Speaker Change: But we'll have this year in addition to fino.
Speaker Change: Not assessing those in.
Bruce Gibbon: We'd love to hear your thoughts, and I have a quick follow-up. Well, you know, there's a lot of interest in the remnant cholesterol concept, and there are a lot of Mendelian randomization data and other data pointing to these remnant cholesterols being highly atherogenic, and in some of these analyses, they are even more atherogenic than ApoB and, and, you know, LDL at a milligram It's as yet, you know, unproven in clinical trials because, frankly, there just haven't been good enough drugs, you know, for treating these. And so it has been untestable.
Speaker Change: The level of detail that we're doing in the rage cohorts with the other pulmonary programs like bulk buy they see or MMP seven just.
Speaker Change: Not as relevant we do measure cell counts on on Bell for all the pulmonary programs just to get an indication of if we're seeing any kind of pro inflammatory effect and we've not seen such an effect to date in the valve for any of those three programs.
Speaker Change: Got it thanks for taking my question.
One moment for our next question.
Speaker Change: Sure.
Speaker Change: And our next question comes from Jason <unk>.
Bruce Gibbon: You know, they were waiting for a good drug to come along that you could, you know, you could test this remnant cholesterol hypothesis, and both Sodacaran and Plozacaran are really, you know, incredibly good drugs from a pharmacologic perspective. So yeah, they offer that opportunity. And it's not actually an easy choice between the two because they're both equivalent in a lot of ways with respect to their ability to address that particular question.
Jason: With Bank of America. Your line is open.
Jason: Hey, guys. Thanks for taking my question.
Jason: One for me on on rates can you just remind us.
Jason: What your cutoff is for high end.
Jason: And.
Jason: Will there.
Jason: Placebo patients that you're actually comparing against with that data update in <unk> and what I'm trying to get at is thinking about your confidence you can derive from about 25 patients of data here.
James Hamilton: So I think it's, you know, there's plenty of paper out there, plenty of, you know, you know, genetic studies that point us this way, that give us a reason to be hopeful, you know, as a field, let alone as a company. But ultimately, we have to, we have to prove it; we have to do the old-fashioned thing; we have to actually do the clinical trials and prove it. I got it. And then on the pheno high cohort, James. I heard sputum and blood biomarker data will also be part of the 3Q analysis. Could you just maybe talk about the significance of that?
Jason: With respect to like Vino variability at the measure.
Jason: And just lastly, do you think theres, a chance that aero rates could achieve higher than this 30% to 40% bogey set by biologics on the Pheno measure just given it targets multiple interleukin is involved in the type two inflammatory pathway.
Speaker Change: Sure Yeah, I can't really comment on the magnitude question of that.
Speaker Change: What we expect or if we think we can.
Speaker Change: Have a higher fee and a reduction compared to the biologics the pheno cutoff is 35.
James Hamilton: And broadly, in your pulmonary pipeline for MUC5 and other patient cohorts, are you also assessing that, and what's the relevance of that as you look to make some go-no-go decisions this year? Thanks for taking on this. Sure, right. So the additional biomarker data, specifically the cytokines I mentioned, I think that those are an important piece of the readouts that we'll have this year, in addition to phenotype. We are not assessing those at the level of detail that we're doing in the RAGE cohorts with the other pulmonary programs like MOC5AC or MMP7, just not as relevant. We do measure cell counts on BALF for all the pulmonary programs just to get an indication of if we're seeing any kind of pro-inflammatory effect, and we've not seen such an effect to date in the BALF for any of those three programs.
Speaker Change: And there are.
Speaker Change: Thank you.
Speaker Change: 38 total patients across the <unk> cohort. So we should have a pretty good number and that includes placebo patients. So.
Speaker Change: We will be able to compare the active treatment arm to to a placebo group.
Speaker Change: Got it okay. Thank you.
Speaker Change: One moment for our next question.
Speaker Change: And our next question comes from Patrick <unk> with H C. Wainwright Your line is open.
Speaker Change: Thanks.
Patrick O'brien: Couple of follow up questions. The first is just on the CMO role. If you can maybe discuss the reasoning behind the decentralized.
Patrick O'brien: The Chief Medical officer function and what impact this is expected to have as well as potential advantages of <unk>.
James Hamilton: Got it. Thanks for taking the call. One moment for our next question. And our next question comes from Jason Erbery with Bank of America. Your line is open.
Patrick O'brien: Centralized approach and then secondly, just on the CNS platform can you talk a bit more about what went wrong with Aero side, one more specifically was it a decision based on market at the time.
Operator: Hey guys, thanks for taking my question. One for me on Rage, can you just remind us what your cutoff is for Hypheno and, you know, will there be placebo patients that you're actually comparing against with that data update in 3Q? And what I'm trying to get at is, you know, thinking about your confidence in derived from about 25 patients of data here with respect to phenovariability as a measure, you know, and, you know, and just lastly, do you think there's a chance that, you know, ArrowRage could achieve higher than this 30 to 40% bogey set by Biologics on the phenomeasure, just given it targets, Sure, I can't really comment on the magnitude question of what we expect or if we think we can have a higher pheno reduction compared to the biologics. The pheno cutoff is 35.
Yes.
Patrick O'brien: And also maybe just give us an idea of how you expect this platform to build out going forward.
Sure so so with the.
With the slight restructuring of R&D.
Patrick O'brien: We just thought that we needed.
Speaker Change: Good good.
Speaker Change: <unk>.
Speaker Change: Leaders with deep expertise in our chosen verticals, so far that's going to be cardiomyopathy, olive we expect culinary to be to be the next vertical.
Speaker Change: We just need a deep expertise there.
Speaker Change: We expect those not to be the last vertical that we're going to create we're probably going to have several others going forward.
Speaker Change: And they just needed their own leaders and so made so for us it made sense to restructure.
Speaker Change: Towards that regarding San Juan you look there is nothing there is nothing within within Aero side, one that pushed us off at to be honest.
Speaker Change: We liked it we liked aero side, one we liked.
Speaker Change: The opportunity because because it gave us a good chance to interrogate.
Speaker Change: On the platform.
James Hamilton: And there are 38 total patients across the high pheno cohort, so we should have a pretty good number, and that includes placebo patients. So, you know, we will be able to compare the active treatment arm to a placebo group. Got it.
Speaker Change: He's going to give us a good I'd say, we thought proof of concept for the platform is working or not working the problem was solved with San Juan is that is that it was becoming it was appearing to be increasingly commercially unviable. So the good news is we can see what's working the bad news is you didnt make economic sense to develop that drug we thought.
James Hamilton: Okay. Thank you. One moment for our next question, and our next question comes from Patrick Truccio with HC Wainwright. Your line is open.
Speaker Change: And we and we had a fast follower at least one.
Patrick Truccio: Thanks. I have a couple of follow-up questions. The first is just on the CMO role. If you can maybe discuss the reasoning behind decentralizing the chief medical officer function and what impact this is expected to have, as well as potential advantages of this decentralized approach. And then secondly, just on the CNS platform, can you talk a bit more about what went wrong with Aerosod 1 more specifically? You know, was it a decision based on market potential or the SRA or something else?
Speaker Change: That we think.
Speaker Change: At once gives us the ability to to interrogate the platform. It gives us good proof of concept with platform, but also will be a more commercially viable drug. So it just made sense to allocate resources to get into others and so it was less of a sod one failing than than than a lack of confidence in the <unk>.
Speaker Change: <unk> market.
Speaker Change: Got it that's helpful. Thank you very much.
Speaker Change: Welcome.
Speaker Change: One moment for our next question.
Chris Anzalone: And maybe just give us an idea of how you expect the CNS platform to build out going forward. Sure. So with the slight restructuring of R&D, look, we just thought that we needed, you know, good leaders with deep expertise in our chosen verticals. You know, so far, that's going to be cardiometabolic.
Speaker Change: And our next question comes from Manny <unk> with Leerink partners. Your line is open.
Manny: Hey, guys. Thanks, taking the questions a couple of quick ones.
Manny: When you talk about $100 million step down.
Manny: And operating expenses, obviously buys a lot of wiggle room for the company and and allows you to maximize return on investment could you give us.
Chris Anzalone: We expect Pulmonary to be, you know, the next vertical. We just need deep expertise there. We expect those not to be the last verticals that we're going to create. We're probably going to have, you know, several others going forward. And they just needed their own leaders.
Manny: Any sort of color on the tempo at which we'll see that slow into opex over the course of this year just for our own modeling and then I've got a couple of quick pipeline questions to follow up.
Speaker Change: So I think you should expect those.
Chris Anzalone: And so for us, it made sense to restructure towards that. Regarding SOD1, look, there's nothing within Arrow SOD1 that pushed us off it, to be honest. We liked it.
Speaker Change: <unk> immediately.
Speaker Change: Look at what our burn was.
Speaker Change: In the current quarter. It was it was high compared to previous quarters, but we think it will go back to <unk>.
Speaker Change: Normalized spend.
Speaker Change: Like I had mentioned before of about $80 million to $100 million and you can expect that beginning with the.
Chris Anzalone: We liked the opportunity because it gave us a good chance to interrogate the platform. You know, it was going to give us a good, I'd say, we thought, proof of concept that the platform is working or is not working. The problem with SOD1 is that it was becoming, or appeared to be increasingly commercially unviable. So the good news is, you know, we could see if it's working. The bad news is it didn't make economic sense to develop that drug, we thought. And we had, you know, a fast follower, at least one that we think, you know, at once gives us the ability to, you know, interrogate the platform and gives us good proof of concept of the platform but also will be a more commercially viable drug. So it just made sense to allocate resources to it and to others.
Speaker Change: Second fiscal quarter.
Okay.
Speaker Change: Okay.
Speaker Change: Hopping over to the pipeline.
Speaker Change: For Arrow, and HPE or MTV or are we going to pronounce it.
Speaker Change: That's.
That's the target for which we've seen some of it some evidence and brought bought human population studies et cetera.
Speaker Change: For a change in adipose phenotype.
Speaker Change: In terms of distribution.
Speaker Change: The hip to waste ratio.
Speaker Change: Even after one accounts for BMI, so should we be thinking of that as.
Speaker Change: A place where we're going to eventually see data.
I think the targets weight loss adipose distributions like what what are the endpoints, we should be thinking out in humans and then what are the endpoints, we should be thinking about in earlier stage studies as we sort of as this ethic progressively derisk.
Chris Anzalone: So it was less of a SOD1 failing than a lack of confidence in the SOD1 ALS market. Got it. That's helpful. Thank you very much.
Speaker Change: Yes, sure I think all of the above four at least in terms of our initial clinical study will look at all of that.
Operator: You're welcome. One moment for our next question. And our next question comes from Manny Borujar with Lee Ring Partners. Your line is open. Thank you for the questions. A couple of quick ones, talk about the $100 million step down in operating expenses, which obviously buys a lot of wiggle room for the company and allows you to maximize your investment.
Speaker Change: Investigate.
Speaker Change: Not just changes in body weight loss, but we'll evaluate body composition loss of lean mass distribution of adipose tissue.
Speaker Change: The visceral fat stores shrinking what happens to lean mass and we're also interested in what happens to measures of <unk> control like it.
Speaker Change: <unk> oral glucose tolerance testing so I think.
Manny Borujar: Could you give us any sort of color on the tempo at which we'll see that slow into OPEX over the course of this year just for our own modeling, and then I've got a couple of quick pipeline questions to follow. So I think you should expect those results immediately. If you look at what our burn was in the current quarter, it was high compared to previous quarters.
Speaker Change: There are quite a few endpoints that we can study.
Speaker Change: And even a phase one study and learn a lot about.
Speaker Change: Drug in about that particular target.
Speaker Change: Great.
Speaker Change: Follow up is there is there an opportunity at an initial human data set to see this to see this asset.
Speaker Change: Tested boats in patients who are on and off with one on the GOP one given how broadly they're taken amongst the population of the U S and other places where you guys have done clinical trials.
Ken Muskowski: But we think it will go back to a normalized spend, like I had mentioned before, of about $80 to $100 million. And you could expect that beginning in the second fiscal quarter. Okay, and hopping over to the pipeline for Arrow INHBE or INHBE, however we're going to pronounce it. That's the target for which we've seen some evidence in broad human population studies, etc., for a change in adipose phenotypes in terms of distribution, in terms of hip-to-waist ratio, even after one accounts for BMI.
Speaker Change: I think so I think that would be.
Speaker Change: A little ways away from the clinic, but.
Speaker Change: Would anticipate a study design that first starts in that.
Patients that are not on those drugs and then also investigates the combination of the GOP, one agonist with inhibiting <unk> knockdown and <unk>.
James Hamilton: So should we be thinking of that as a place where we're going to eventually see data that targets weight loss, adipose distribution, like what are the endpoints we should be thinking about in humans, and then what are the endpoints we should be thinking about in earlier stage studies as we sort of, as this ethic is progressively derisked? Yeah, sure. I think all of the above, at least in terms of our initial clinical study, we'll look at all of that and investigate not just changes in body weight loss, but we'll evaluate body composition, loss of lean mass, distribution of adipose tissue, the visceral fat stores shrinking, and what happens to lean mass. And we're also interested in what happens to measures of glycemic control like A1C or oral glucose tolerance testing.
Speaker Change: See how the combination plays out.
Speaker Change: Great I'm going to.
Speaker Change: And I'll hop off.
Speaker Change: Others are still waiting in the queue. Thanks, guys.
Speaker Change: One moment for our next question.
Speaker Change: And our next question comes from Brendan Smyth with TD.
Brendan Smyth: Your line is open.
Brendan Smyth: Hi, This is Dana on for Brendan. Thank you for taking my question I can ask.
Brendan Smyth: Okay.
Brendan Smyth: Right.
Dana: Adipose tissue.
Dana: Okay.
Dana: Recent partnerships.
Dana: The highest priority.
Dana: Thank you.
Speaker Change: Yes, sorry.
Speaker Change: We're breaking up can you repeat that.
Speaker Change: Yes.
Speaker Change: Your noncore pipeline programs would you consider for a development commercialization partnership in which of these would be the highest priority for you.
James Hamilton: So I think there are quite a few endpoints that we can study in even a phase one study and learn a lot about the drug and about that particular target. Great. And as a follow-up, is there an opportunity in the initial human data set to see this asset tested both in patients who are on and off GLP1 and GLP1 given how broadly they're taken amongst the population of the U.S. and other places where you guys have done clinical trials? Yeah, I think so. I think that would be, you know, we're still a little ways away from the clinic, but I would anticipate a study design that first starts in obese patients that are not on those drugs and then also investigates the combination of GLP-1 agonists with inhibin-E knockdown and see how the combination plays out. Great. I'm going to hop off. I know Ellie and a couple of others are still waiting in the queue.
Speaker Change: Yes. So unfortunately, we don't do that entirely we need a counterparty that is going to be interested as well look there are.
Speaker Change: We would we would certainly.
Speaker Change: Be happy to talk about <unk> for instance.
Speaker Change: We'd be happy to talk about about the muscle asset. We think those are we think those are all good assets, but at least right now don't fit neatly into a planned vertical one would think that muscle.
Speaker Change: We'll be in NASA vertical for us and it could morph into that but right now we are happy to talk.
Speaker Change: To the right partner about about one or both of those assets.
Speaker Change: <unk> III potentially could be something that we are interested in Nash as it is a bit in flux right now.
Speaker Change: But that's something that we could consider and discussing as we as a partner in HST to GSK, we could talk about that as well.
Speaker Change: That's sort of what it feels like right now in our existing clinical pipeline.
Manny Borujar: Thanks, guys. One moment for our next question. And our next question comes from Brendan Smith with TD Cowan. Your line is open. Hi, this is Jayna on behalf of Brendan.
Speaker Change: Alright, thank you.
Speaker Change: <unk>.
Speaker Change: Youre welcome.
Speaker Change: One moment for our next question.
Speaker Change: And our next question comes from Mike <unk> with Morgan Stanley. Your line is open.
Mike: Hey, guys. Thanks for taking the question maybe just a quick follow up here in terms of BD.
Operator: Thanks for taking our question. I just want to ask, which of your non-formal breasts are you scanning for adipose tissues? and the Development and Commercialization Partnership, and which would be the highest priority. Thank you. Yeah, sorry, you're breaking up.
Mike: You mentioned, maybe one or two potential deals this year.
Mike: Could they potentially include the core areas like cardio metabolic and pulmonary or are those going to be excluded from <unk>.
Brendan Smith: Can you repeat that? Yeah. Of your non-core pipeline programs, would you consider a development commercialization partnership, and which of these would be the highest priority for you? Yeah, so unfortunately, we don't choose that entirely.
Speaker Change: <unk> royalty deals.
Speaker Change: <unk>.
Speaker Change: Let's let's deal with those separately, so cardio metabolic.
Speaker Change: We are we are full speed ahead, with <unk> and <unk> right now and.
Chris Anzalone: You know, we need a counterparty that's going to be interested as well. Look, there are We would certainly be happy to talk about C3, for instance. We'd be happy to talk about the muscle assets. We think those are all good assets, but at least right now, they don't fit neatly into a plan vertical. One would think that muscle, you know, will be a natural vertical for us, and it could morph into that.
Speaker Change: And so we are not actively.
Speaker Change: Looking to partner those on the.
Speaker Change: On the pulmonary side, we are not actively seeking partners for our three clinical assets, we could be we would be happy to discuss with a potential partner a platform partnership whereby somebody would bring in.
Speaker Change: A target that we may not be working on for us to together build a drug candidates.
Chris Anzalone: But right now, we are happy to talk to the right partner about one or both of those assets. PMP3 potentially, you know, could be something that we are interested in. NASH is, it is a bit in flux right now.
Speaker Change: At least right now we are not looking at partnering those existing clinical assets.
Speaker Change: Okay. That's helpful. Thank you.
Speaker Change: Youre welcome.
Speaker Change: One moment for our next question.
Speaker Change: And our next question comes from Ellie Merle with UBS. Your line is open.
Chris Anzalone: But but that's something that we could consider discussing, you know, as we as we partner HSD with GSK, we could talk about that as well. That's sort of what it feels like right now in our existing clinical pipeline. All right, thank you. You're welcome.
Hey, guys. Thanks for squeezing me in.
Ellie Merle: And then on <unk> you had mentioned.
Ellie Merle: Program I guess, just what's the latest on that.
Ellie Merle: Status and timelines, there and just the focus of that program.
Operator: One moment for our next question. And our next question comes from Mike Alls with Morgan Stanley. Your line is open. Hey guys, thanks for taking the question and maybe just a quick follow-up here in terms of BD. You mentioned maybe one or two potential deals this year. Could they potentially include, you know, the core areas like cardiometabolic and pulmonary? Or are those going to be excluded from?
Speaker Change: And then just unrelated note.
Speaker Change: As you think about planning a larger phase III study in asthma.
Speaker Change: What are the considerations and the design and what you are looking to see and the highest.
Speaker Change: Cohort later this year.
Speaker Change: What do you think from the type two program perhaps.
Speaker Change: That consideration.
Speaker Change: Thanks.
Speaker Change: Sure.
Speaker Change: <unk> program.
Mike Alls: Let's deal with those separately. So, cardiometabolic, we are full speed ahead with Zodaciran and Plozaciran right now. And so, we are not actively, you know, looking to partner those. On the pulmonary side, we are not actively seeking partners for our three clinical assets.
Speaker Change: We are seeing not we've seen a range of knockdown. That's the good news, we just werent seen as deeper knockdown as we've seen with inhaled.
So we are really focusing our future development on the inhaled, but again, but it didn't work. It just it just was not.
Speaker Change: As as strong as the as the inhaled version.
Chris Anzalone: We could be, we would be happy to discuss with a potential partner, a platform partnership whereby somebody would bring in, you know, a target that we may not be working on for us to, together, build a drug candidate. But at least right now, we are not looking at partnering those existing clinical assets. That's helpful; thank you. You're welcome. One moment for our next question, and our next question comes from Ellie Murrell with UBS. Your line is open. Hey guys, thanks for squeezing me in.
James: James you want to.
James: I don't have anything to add to that I don't think it will play into our phase II plans, though.
James: And sorry, the second question about <unk> again.
James: Can you repeat.
Speaker Change: Just the timelines for that thank you Sir.
Speaker Change: Larry and.
Speaker Change: And Mike what you are looking to see from the high seen alcohol.
Speaker Change: How that might inform some of them.
Speaker Change: Thanks.
Speaker Change: Yes, so we're tossing around.
Speaker Change: Thinking about a lot of different designs right now I think design.
Operator: Just in the past on RAGE, you mentioned a sub-Q program. I guess what's the latest on the status and timelines there and just the focus of that program? And then, just on a related note, as you think about planning a larger phase 2 study in asthma, what are the considerations there and the design and what you're looking to see in the high fetal cohort later this year? And just, you know, would anything from the sub-Q program perhaps play into some of the considerations in the design? Thanks. Sure, so on the SubQ program, we were seeing a rage knockdown. That's the good news. We just weren't seeing as deep a knockdown as we were seeing with the inhaled.
Mike: Certainly want to be able to study both.
Mike: Hi type two in the non type two patients.
Mike: In a single design and I think.
Mike: The final readout in Q3 may inform on.
Mike: Which patient population, we want to favor one more than the other but I think we'll want to.
Mike: Plan to study both.
Speaker Change: Yes, and keep in mind with the.
Fino data look we're looking forward to seeing that of course, but it really only reflects moving a single pathway as James mentioned in his prepared remarks.
Ellie Murrell: So we are really focusing our future development on the inhaled version. But again, it did work. It just was not as strong as the inhaled version.
Speaker Change: Rage, we expect rates to move a number of different a different cytokines and pheno is only really.
Speaker Change: Detecting movement of one of those.
James Hamilton: James, you want to? No, I don't have anything to add to that. I don't think it will play into our phase two plans, though. And so what's the second question about Essama again? Can you repeat that one?
Speaker Change: So while it's helpful. It's certainly not the only important data point.
Speaker Change: Got it.
Speaker Change: Yes.
Speaker Change: One moment for our next question.
Speaker Change: And our next question comes from Maury Raycroft with Jefferies. Your line is open.
James Hamilton: Yeah, just the timeline for the phase two start and the design considerations, and like what you're looking to see from the high phenotype cohort and how that might inform some of the design decisions. Thanks. Yeah, so we're tossing around and thinking about a lot of different designs right now.
Maury Raycroft: Hi, Thanks for taking my questions.
Maury Raycroft: I was going to ask one of our age two so for the higher dose PD asthma patient data that youre collecting can you clarify if youll do a public update on that at the end of this quarter on those data and will that only include knockdown or will that include cytokines and other PD biomarkers as well.
James Hamilton: I think a design we certainly want to study both the high type 2 and the non-type 2 patients in a single design. And I think the Fino readout Q3 may inform us about which patient population we want to favor more than the other, but I think we'll want to plan to study both. Yeah, keep in mind, you know, with the pheno data, look, we're looking forward to seeing that, of course, but it really only reflects movement on a single pathway, you know, as James mentioned in his prepared remarks, rage, we expect rate to move a number of different different cytokines and phenos, only really, detecting movement of one of those. And so while it's helpful, it's Thanks. That's very helpful.
Speaker Change: So it will include knockdown of <unk>.
Speaker Change: Sure.
Speaker Change: And I'm not sure if theres, if theres going to be.
Speaker Change: A good venue in the near term to report those I can tell you that what we've seen so far and it's still an incomplete data set what we've seen so far as is consistent with what we said in the past, which is what we're seeing in knockdown in patients is really mapping on top of what we what we have seen.
Speaker Change: Lockdown profile in healthy volunteers and so that continues.
Once we have a full dataset.
Speaker Change: Given that again I expect that to continue I don't know that we will rush out and have the press release based on that I think we'll probably have that as part of our some presentation.
Speaker Change: <unk> at a conference or what have you but to be honest, we really havent havent.
Speaker Change: Put much thought into into how we're going to disseminate those data because again.
Speaker Change: We expect those to be we expect that the knockdown in patients to be quite similar to healthy volunteers. That's what we've seen so far Jamie everything else now.
Operator: One moment for our next question. And our next question comes from Mari Raycroft with Jeffries. Your line is open. Hi, thanks for taking my questions. I was going to ask one about RAGE, too.
Jamie: Got it Okay. That's helpful. And then maybe one follow up just for dux for.
Speaker Change: <unk> could you potentially have data updates from either of those programs this year.
Mari Raycroft: So for the higher dose PD asthma patient data that you're collecting, can you clarify if you'll do a public update on that at the end of this quarter on those data? And will that only include knockdown, or will that include cytokine and other PD biomarkers as well? Let's see, so it will include knockdowns for sure, and I'm not sure if there's going to be a good venue in the near term to report them.
Speaker Change: Yes, I think thats, depending on how enrollment goes we could have some some early data by by end of the year, but very enrollment contingent.
Speaker Change: Got it okay. Thanks for taking my questions.
Speaker Change: Thanks, Brian.
Speaker Change: Our next question.
Speaker Change: And our next question comes from <unk> <unk> with Cantor Fitzgerald. Your line is open.
Bruce Gibbon: I can tell you that what we have seen so far, and it's still an incomplete dataset, what we have seen so far is consistent with what we've said in the past, which is that what we're seeing in knockdown in patients is really mapping on top of what we have seen, the knockdown profile in healthy volunteers. And so that continues. You know, once we have a full dataset, you know, given that, again, I expect that to continue, I don't know that we'll rush out and have a press release based on that. I think we'll probably have that as part of, you know, some presentation at a conference or what have you. But to be honest, we really haven't put much thought into how we're going to disseminate those data. We expect the knockdown in patients to be quite similar to healthy volunteers. That's what we've seen so far. James, do you have anything else? No.
Cantor Fitzgerald: Hi, Thanks for taking my questions number one on inhibiting E. Pre clinically how does your candidates profile differ versus some of your competitors on myeloma and <unk> in terms of the level of knockdown Youre seeing I think you had mentioned 20% of <unk>. So maybe if you can compare and contrast that.
Speaker Change: And then I had a follow up.
Speaker Change: Sure, Yes, I think that that that level of.
Speaker Change: Differential in weight gain.
Speaker Change: The control animals, and the animals, receiving drug is similar to what others have reported in that study we were seeing at <unk>.
Speaker Change: 90, plus I think 96% knockdown in that that obesity mouse model, which.
Speaker Change: As I believe more than what others have reported.
I think thats, probably the best I can tell you.
Chris Anzalone: Got it. Okay, that's helpful. And then maybe one follow-up just for DUX4 or DM1.
Got it.
Speaker Change: On the TV side.
Speaker Change: One of the key question is do you need answers from the FDA to make a decision on which television asset to move forward into the outcomes trial for the broader population or is it just mostly an internal decision that at this point.
Bruce Gibbon: Could you potentially have data updates from either of those programs this year? Yeah, I think that's depending on how enrollment goes. We could have some early data by the end of the year, but very early. Got it. Okay, thanks for taking my question. Thanks, Borey.
Yes, I mean, we haven't gone to the Bruce given again, we haven't gone to the FDA.
Speaker Change: At this point on that.
Speaker Change: At some point.
Operator: One moment for our next question, and our next question comes from Prakhar Agarwal with Cantor Fitzgerald. Your line is open.
Speaker Change: We will of course go to the FDA would start a trial like that without their input.
Speaker Change: But we're not at the point yet that we engage them is in the discussion.
Prakhar Agarwal: Number one on inhibitor E, preclinically, how does your candidate's profile differ versus some of your competitors on ILM and WAVE in terms of the level of knockdown you're seeing? I think you mentioned 20% weight loss and DIO models.
Speaker Change: Okay. Thank you for taking the questions.
Speaker Change: Sure.
Speaker Change: One moment for our next question.
Speaker Change: And our next question comes from David Leibowitz with Citi. Your line is open.
Speaker Change: David Leibowitz your line is open.
David Neil Lebowitz: Hello, Hi, Tien tsin.
James Hamilton: So maybe if you can compare and contrast that. I'm going to add a follow-up. Sure, yeah, I think that that level of... Differential in weight gain between the control animals and the animals receiving the drug is similar to what others have reported.
David Neil Lebowitz: Yes, we can yes.
How did you go banking oncor Diebold and thanks for taking our question.
David Neil Lebowitz: So maybe regarding the <unk> outlook.
Speaker Change: Thank you.
Speaker Change: You mentioned that the loss.
Bruce Gibbon: And in that study, we were seeing 90-plus, I think 96% knockdown in that obesity mouse model, which is, I believe, more than what others have reported. I think that's probably the best I can tell you. Got it. And on the CV side.
Diebold: Thank you for the music in second quarter. We were wondering if you could give us and giving you more color in terms of the data readout timelines and maybe one data point is can we expect to see at Davita.
Bruce Gibbon: What are the key questions you need answers from the FDA to make a decision on which CV acid to move forward with in the outcomes trial for the broader population, or is it just mostly an internal decision? Yeah, I mean, we haven't gone to the FDA. It's Bruce Given again. We haven't gone to the FDA. At this point in that, at some point, you know, we will, of course, go to the FDA and start a trial like that without their input. But we're not at the point yet that we've engaged them in the discussion.
Diebold: Okay.
Speaker Change #100: Well I think.
Speaker Change #101: We would again be looking to present I would think in a meeting.
Speaker Change #102: I actually havent spoken with with Chris on this maybe we would top line in some way.
Speaker Change #102: Once once we did that but we'd want to do that in such a way it's too not present.
Speaker Change #102: Fulsome presentation.
Speaker Change #102: At an academic meeting at some point I think it's kind of the same sort of question. The same answer we had before at this point, it's hard to predict what meeting that would be and when that would occur.
Operator: Thank you for the interview. Sure. One moment for our next question. And our next question comes from David Lebowitz with Citi. Your line is open. David Lebowitz, your line is open.
David Neil Lebowitz: Hello? Hi, can you hear me now? Yes, we can. Yes. Hi, hi, this is Devanjana on behalf of David. Thanks for taking our questions. Regarding the FTS readout of Flozasirin, you mentioned that the last patient is scheduled for the visit in the second quarter. We were wondering if you could give us a little more color in terms of the data readout timeline, and maybe what data points we can expect to see at the readout. Well, I think, you know, we would again be looking to present at a meeting. I actually haven't spoken with Chris on this. Maybe we would improve the line in some way once we did that.
Speaker Change #102: But.
Speaker Change #102: Yes, I suspect we would in some way give some topline information, but most of the fulsome data would come out later I would expect.
Speaker Change #103: And maybe just one follow up I was wondering that resulted in an olive garden on board approved how do you choose between the two.
Speaker Change #104: It's hard to answer that question.
Speaker Change #104: Setting where actually we don't have the.
The comparative results of the two agents at this point.
Bruce Gibbon: But we'd want to do that in such a way as not to present a fulsome presentation at an academic meeting at some point. I think it's kind of the same sort of question, and the same answer we had before. At this point, it's hard to predict what meeting that would be and when that would occur. But yeah, I suspect we would in some way get some top-line information, but most of the fulsome data would come out later, I would expect.
Speaker Change #104: On either efficacy or safety in the FCS population. So it's it would be wildly spec speculative at this point to try to make a call on that.
Speaker Change #105: Yes, I don't I don't think we I don't think that we've seen.
Speaker Change #105: Glyceride.
Speaker Change #105: Levels from.
Speaker Change #105: That phase III yet.
Speaker Change #105: <unk>.
Speaker Change #105: When we when we look at at.
Speaker Change #105: The available data from from their phase II versus our phase twos. We are we are comfortable that our dosing interval will be longer.
Speaker Change #105: <unk>.
Chris Anzalone: Thank you. And maybe just one follow-up question. Assuming that flozacidin and oligarcin are both approved, how do you think clinicians would choose between the two therapies? It's hard to answer that question in a setting where we don't actually have the comparative results of the two agents at this point on either efficacy or safety in the FCS population. So, it'd be wildly speculative at this point to try to make a call on that.
Speaker Change #105: And it appears at least according to the phase II data. It appears that our apoc III knockdown is greater than our triglyceride lowering is greater but again as Bruce says, we don't know what the phase II it looks like on their side on our side frankly.
Speaker Change #106: Thank you that's helpful.
Speaker Change #106: And our final question comes from the line of William Greene with Bernstein. Your line is open.
William Greene: Hi, Good evening. Thank you for taking my question.
William Greene: Estimated the addressable FCS population at 70 to 100000, which sounds like a.
Chris Anzalone: Yeah, I don't I don't think we've seen triglycerides levels from that phase three yet. You know, when we look at the available data from their phase twos versus our phase twos, we are comfortable that our dosing interval will be longer. And it appears, at least according to the phase two data, that our ApoC3 knockdown is greater, and our triglyceride lowering is greater. But again, as Bruce says, we don't know what phase three looks like on their side or on ours.
William Greene: Pretty large population to get approved based on a single 75 person study. So can you just remind us of your agreed.
William Greene: Agreement with the FDA on the exact definition of that FCS population for which they agreed to accept just a single trial. Thank you.
In that in that Phase II study we are studying.
William Greene: People with genetically confirmed FCS and those patients with with clinical FCS If you will which is patients with a choice of rides above 880.
Chris Anzalone: Thank you, that's helpful. And our final question comes from the line of William Pickering with Bernstein. Your line is open.
Operator: Hi, good evening. Thank you for taking my question. You've estimated the addressable FCS population at 70 to 100,000, which sounds like a pretty large population to get approved based on a single 75-person study.
William Greene: And history of pancreatitis.
William Greene: That's the population we're studying.
Speaker Change #108: Thank you.
Speaker Change #109: Youre welcome.
Speaker Change #109: And I would now like to turn the conference back to Chris Anzalone for closing remarks.
William Pickering: So can you just remind us of your agreement with the FDA on the exact definition of that FCS population for which they agreed to accept just a single trial? Thank you. In that phase three study, we are studying people with genetically confirmed FCS and those patients with clinical FCS, if you will, which are patients with triglycerides above 880 and a history of pancreatitis. That's the population we are studying.
Chris Anzalone: Thanks, very much for tuning in today, we look forward to speaking with you over the next quarter and those of you who are in southern California, I Hope you stay dry.
Speaker Change #110: This concludes today's conference call. Thank you for participating you may now disconnect.
Speaker Change #110: Goodbye.
Speaker Change #110: Okay.
Speaker Change #110: Yeah.
Speaker Change #110: Yes.
Speaker Change #110: Yes.
Speaker Change #110: Yes.
Speaker Change #110: Okay.
Speaker Change #110: Okay.
Speaker Change #110: Okay.
Chris Anzalone: Thank you. You're welcome. And I would now like to turn the conference back to Chris Anzalone for his closing remarks. Thanks very much for tuning in today. We look forward to speaking with you over the next quarter, and those of you who are in Southern California, I hope you stay dry. This concludes today's conference call. Thank you for participating. You may now disconnect. Goodbye.
Speaker Change #110: Okay.
Speaker Change #110: Okay.
Speaker Change #110: [music].
Speaker Change #110: Okay.
Speaker Change #110: Yes.
Speaker Change #110: Okay.
Speaker Change #110: [music].
Speaker Change #110: Yes.
Speaker Change #110: Yeah.
Speaker Change #110: Okay.
Speaker Change #110: Okay.
Speaker Change #110: Sure.
Speaker Change #110: Okay.
Speaker Change #110: Okay.
Speaker Change #110: Yes.
Speaker Change #110: Okay.
Speaker Change #110: [music].
Okay.
Speaker Change #110: Yes.
Speaker Change #110: Jim.
Speaker Change #110: [music].
Speaker Change #110: Yes.