Q1 2024 Belite Bio Inc Earnings Call

Operator: Joining the call today are Dr. Tom Lin, Chairman and CEO of Belite Bio; Dr. Nathan Mata, Chief Scientific Officer; and Hao-Wan Zhang, Chief Financial Officer.

Your Doctor Tomlin, Chairman and CEO of <unk> bio.

Speaker Change: Dr. Nathan Martin Chief Scientific Officer, and how long Jones, Chief Financial Officer.

Operator: Before we begin, let me point out that we will be making forward-looking statements that are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties, and actual results may differ materially. We encourage you to consult the risk factors discussed in our SEC filings for additional detail. Please note that you can submit questions throughout the call today by clicking on the Q&A box at the bottom of your screen, and we'll respond to questions following our prepared remarks. Now, I'll turn the call over to Dr. Lin.

Speaker Change: Before we begin let me point out that we will be making forward looking statements that are based on our current expectations and beliefs.

SEC: These statements are subject to certain risks and uncertainties and actual results may differ materially. We encourage you to consult the risk factors discussed in our SEC filings for additional detail.

Speaker Change: Please note that you can submit questions throughout the call today by clicking on the Q&A box at the bottom of your screen and we will respond to questions. Following our prepared remarks.

Speaker Change: Now I'll turn the call over to Dr. Lynn.

Dr. Lynn: Thank you Judy.

Tom Lin: Thank you everyone for joining us for our reporting for the first quarter. I'm Tom Lin, CEO of Belite Bio. Joining me is our CSO, Nathan Mata, and CFO, Hao Yuan.

Dr. Lynn: Well. Thank you everyone for playing all reporting for the first quarter.

Dr. Lynn: And then C O b lifestyle.

CFO: I mean is all CSO model and CFO how are you.

Tom Lin: I'd like to start off with an overview. Teleriband is a novel once daily oral tablet designed to bind to a certain retinal binding protein known as RPP4 as a means to specifically reduce retinal delivery to the eye. This approach is intended to slow or stop the formation of the toxic retinol derived by products which are generated in the visual cycle and are implicated in the progression of Augustus disease and geographic atrophy.

Dr. Lynn: I'd like to start off with an overview.

CFO: <unk> is a novel once a day oral tablet designed to bind to the retro binding proteins not as RP before.

CFO: It means to us specifically reduced rental delivery to the eye.

Speaker Change: This approach is intended to slow or stop the formation of toxic Brett and I'll give rise to five products, which are generated in the visual cycle and are implicated in progression of disease and geographic atrophy.

Tom Lin: Belite Bio believes that early intervention directed at emerging retinal pathology, which is not mediated by inflammation, will be the best approach to potentially slow disease progression in STATUS disease and GA. There is still a significant unmet need for both indications as there is currently no approved treatment for Starlet's disease, and there are currently no approved oral treatments for TA, and we are already in global phase 3 trials for both indications. So far, we have been granted foster designation, rare pediatric disease designation, and orphan drug designation in the U.S., EU, and Japan. We have several pattern families, with composition of matter patterns lasting until 2040. With patent extension and new patents to be filed, we will have patent protection past the 2040s, for further indication.

Speaker Change: <unk> believes that early intervention directed at emerging Red Hawk pathology.

Speaker Change: If you've not media by inflammation will be the best approach to potentially slow disease progression and startups disease and G. H.

Speaker Change: Okay.

Red Hawk: There is still a significant unmet need for both indications as currently there is no approved treatments for startups disease and there are currently no approved oral treatment for Ta and.

Speaker Change: And we're already in global Phase III trials for both applications.

Speaker Change: So far we have been granted fast track designation rare pediatric disease designation and orphan drug designation in the U S EU and Japan.

We have several patent families and we have composition of matter patents lasting until 2040.

Speaker Change: And the worst patent term extension and new patents, we filed we will have patent protection of Pos at 24 weeks.

Speaker Change: Most other indication.

Tom Lin: At Arvo last week, we presented further positive findings and treatment results from our end of phase two results, which our CSO will be presenting. The Phase 3 is already fully enrolled and estimated to deliver interim results by the end of 2024 or early 2025. We've also initiated a Phase II study in Stardust, which will recruit Japanese patients that are required for NDAs in Japan. For GA, dry air, and dehumidification, we currently have about 100 subjects enrolled in our Phase 3 NCA. And with this, I would like to pass it on to our CSO to give these clinical and scientific updates.

CFO: At our last week, we presented a further positive findings and triple results from our end of phase II results, which our CFO will be presenting.

CFO: The phase III is already fully enrolled and estimated interim readouts by the end of 2020 for early 2025.

CFO: We've also initiated a phase II study.

CFO: <unk>, which will recruit Japanese patients that's required for NDA in Japan.

GE: For GE.

GE: Every indication we currently have about 100 subjects enrolled in our phase III <unk> and C. H.

Operator: Nathan

GE: And with this I would like to pass it onto our CSL to keep these clinical and scientific updates Nathan.

Thank you Tom.

Nathan L. Mata: Thank you everyone for attending. What we'd like to share with you today are some new analyses that we have from our Open Label Phase 2 study in adolescent Stargardt disease. This trial enrolled 13 adolescent Stargardt subjects aged 12 to 18 years of age, and it was a 2-year study in which patients took oral temolarabat 5 mg daily. The first analysis I want to show you is a genetic analysis of all of our patients in the study. This has not previously been reported. You'll see that for each subject, there are two entries.

Nathan: Thank you everyone for attending what we'd like to share with you today are some <unk>. Some new analyses that we have from our open label Phase II study in analyst startup disease. This trial enrolled 13 analysts startups subjects, aged 12 to 18 years of age and it was a two year study in which patients took oral to flare up at five milligrams daily.

Nathan L. Mata: That's because there's an allele for each ABCA4 mutation, and so we're looking at two of them. And you can see... 11 of 12, 11 of 13 subjects have severe biolimic mutations. This analysis, by the way, was conducted by Dr. Randall Alecmitz, who is the identifier of the Stargardt gene, the ABCA4 gene.

Speaker Change: The first analysis I'm going to show you is a genetic analysis of all of our patients. In study. This has not previously been reported youll see for each subject to our two entries that's because there isn't a real offer each ABC for mutation and so we're looking at two of them and you can see.

Speaker Change: 11 of 12 or 13 subjects have severe biallelic mutations. This analysis by the way. It was conducted by Dr. Randall allocates identifier of the star of our gene the ABC for gene.

Nathan L. Mata: So the point here is that our cohort is very, very prominently affected with severe mutations. There are only two subjects, subjects three and five, who have a moderate allele of ABCA4 on their mutations. It's important to note the way these genes are classified is through a score called the combined annotated dependent depletion score. In this analysis, scores above 20 are predicted to be among the one percent most deleterious. And you can see all of our subjects, with the exception of those alleles on subjects three and five, have scores well above 20. So this is a very severely affected cohort.

Speaker Change: So the point here is that our cohort is very very.

Speaker Change: Permanently affected with the severe mutations there are only two subjects subjects, three and five who have a moderate allele of ABC for on their on their mutations. It's important to note. The way. These genes are classified as through a score called the combined annotated dependent depletion score in this analysis scores above 20 are predicted to be among the 1%.

Speaker Change: Most deleterious and you can see all of our subject with the exception of those a liaison such as three and five.

Scores well above 20%. So this is a very severely affected cohort.

Nathan L. Mata: The next analysis I'd like to show you is that, of these subjects, five of them, subjects 1, 3, 4, 12, and 13, never spawned an atrophic lesion. This is important because, in this particular study, subjects came in with only autofluorescent lesions at baseline. So we were monitoring the transition of the autofluorescent lesion to the atrophic lesion type, and then once the atrophic lesion formed, we measured the growth rate of that lesion. And we previously reported a remarkably reduced growth rate in the overall population.

Speaker Change: The next analysis I'd like to show you is that.

These subjects five of them subjects 134, 12, and 13 never spawned in atrophic lesion. This is important because in this particular study subjects came in with only auto fluorescent lesions at baseline. So we were monitoring the transition of the auto fluorescent lesion to the atrophic lesion types and then once the atrophic lesion.

Speaker Change: Informed we measure the grocery to have that lesion and we've previously reported a remarkably reduced growth rate in the overall population now we're showing you in those subjects that did not grown atrophic leaves at over 24 months. They had very severe mutations. So the absence of lesion growth in these subjects cannot be attributed to benign or mild mutations.

Nathan L. Mata: Now we're showing you that those subjects that did not grow an atrophic lesion over 24 months, they had very severe mutations. So the absence of lesion growth in these subjects could not be attributed to benign or mild mutations. The next analysis is a very important one because it shows us that four subjects have the exact same allelic mutation. Subjects 9 and 10 are siblings. They are two brothers.

Nathan L. Mata: You can see here they have the exact same mutations across alleles, and subjects 12, 13 are brothers and sisters. They also have the very same mutations. The reason this is important is because other investigators have suggested that identical genetic mutations predict identical disease course. I can tell you right now that is not what we're seeing in the Phase 2 study, and I'll show you some of that information right now. Here we have the visual acuity analysis of all subjects before they came into the study, and they all have different disease duration.

Speaker Change: The next analysis is a very important one because it shows us that.

Other investigators: Four subjects had the exact same allelic mutation subjects nine and 10 are siblings. There are two brothers you can see there. They have the exact same mutations across the wheels and such as 2013, our brother sister. They also have the very same mutations. The reason. This is important is because other investigators have suggested that identical genetic.

Speaker Change: Patients predict identical disease course, I can tell you right now that is not what we're seeing in the phase II study and I'll show you some of that information right now.

Speaker Change: Here, we have the visual acuity analysis of all subjects before they came in to the study and they all have different disease duration. What we did is we looked at subjects that had bilateral vision loss that is vision loss in each eye over the over the period of time between the time they were diagnosed in the time before they came into the study.

Nathan L. Mata: What we did was we looked at subjects that had bilateral vision loss, that is, vision loss in each eye over the period of time between the time they were diagnosed and the time before they came into the study. And what we found was that there were six subjects who had a very severe bilateral vision loss of 10 letters per eye, a mean annual loss of 10 letters per eye. That's significant because, well, for two reasons.

Speaker Change: And what we found is there were six subjects, who had a very severe bilateral vision loss of 10 letters.

Speaker Change: Annual loss of 10 letters per eye, that's significant because for two reasons one.

Nathan L. Mata: One, it tells us that autofluorescent lesions in the fovea do, in fact, cause visual acuity loss. Remember, these subjects have not grown atrophic lesions yet. The other thing that's important is if you look at the sibling subjects again, nine, 10, and 12 and 13, you can see their visual acuity loss is very different. Subjects nine and 10, again, are their two brothers.

Speaker Change: It tells us the auto fluorescent lesions in the fovea do when does that cause visual acuity loss remember these subjects have not grown atrophic lesions yet.

Speaker Change: The other thing that's important is if you look at the sibling subjects again, 910, and 12 and 13 you can see their visual acuity loss is very different subject nine and 10 again are the two brothers there similar disease duration, but subject 10 loss vision, whereas his brother subject nine did not same thing for subjects 12, and 13 subject 12.

Nathan L. Mata: They have similar disease duration, but subject 10 lost his vision, whereas his brother, subject nine, did not. The same thing happened for subjects 12 and 13. Subject 12 had an eight-year disease duration, whereas the sister had only two years, yet the sister with only two years of disease duration lost significant letters, whereas the brother did not. So these data tell us, in fact, that identical genetic mutations do not necessarily predict identical disease progression as so far as it pertains to visual acuity loss.

Speaker Change: An eight year of disease duration, whereas the sister has only two years yet the sister with only two year disease duration lost significant letters, whereas the brother did not so these data tell us in fact, they're identical genetic mutations do not necessarily predict identical disease progression and so far as it pertains to visual acuity loss.

Nathan L. Mata: This is an analysis of the visual acuity of all subjects on the left-hand side and then those six subjects shown on the right. I want to first say that in all subjects over 24 months, the mean loss was only five letters. That is, over a whole period of 24 months, all subjects lost only a mean of five letters over 24 months. So that's roughly 2.5 letters per year. Now if we just focus on the six subjects that came in losing 10 letters per year, we now see that over 24 months, they've only lost about 3.8 letters, which is roughly about two letters per year.

Speaker Change: This is an analysis of the visual acuity all subjects on the left hand side and then those six subjects shown on the right I want to first say that in all subjects over 24 months. The mean loss was only five letters that is over the whole period of 24 months all subjects lost only amina five letters over 24 months. So that's roughly $2 five letters.

Speaker Change: For a year now if we just focus on the six subjects that came in losing 10 liters per year. We now see over 24 months. They have only lost about $3 eight letters, which is roughly about two letters per year. So we've taken the significant 10 liter per year loss down to two letters per year that is a substantial preservation of visual acuity in the sub.

Nathan L. Mata: So we've taken the significant 10-letter-per-year loss down to two letters per year. That is a substantial preservation of visual acuity in these subjects. The next analysis I'd like to show you is the lesion growth analysis. And it's important to note that these autofluorescent lesions convert to atrophic lesions, and a visual of that is shown in the graphic on the upper right-hand side. This is the actual lesion growth data from Subject 10.

Speaker Change: <unk>.

Speaker Change: The next analysis I'd like to show you is the lesion growth analysis and it is important to note that these auto fluorescent lesions convert to atrophic lesions and a visual of that as shown on the graphic on the upper right hand side. This is the actual lesion growth data from subject 10, you can see at baseline. There's this very large auto fluorescent lesion, which you refer.

Nathan L. Mata: You can see at baseline there's this very large autofluorescent lesion, which is referred to as questionably decreased autofluorescence, or QDAF. Over time, atrophic lesions will be spawned within the autofluorescent lesions. So here we're looking at the transition of the autofluorescent lesion to the atrophic lesion type, and we're seeing if there's a proportionality between the decrease in the autofluorescence and the increase in the atrophic lesion size. And that graphic is shown on the lower right-hand side. As I said before, five of 12 subjects, 42% never grew an atrophic lesion. We're not including subject seven in the analysis because that subject was lost to follow at month 12.

Speaker Change: Two as possibly decreased auto fluorescence or Q D. E F overtime atrophic lesions will be spud within the auto fluorescent lesions the auto fluids. The lesions are referred to as definitely.

Speaker Change: Decreased auto florist lesions. So here, we're looking at the transition of the auto for us that lesion to the terrific lesion types and we're seeing if theres a proportionality between the decrease of the auto fluorescence and the increase of the atrophic lesion size and that graphic is shown on the lower left lower right hand side as I said before five of 12 subjects, 42% now.

Speaker Change: Ever grew in atrophic lesion, we're not including including subjects seven and the analysis because thats subject was lost to follow up at month 12, but in those subjects that did grow atrophic lesions you can see a very clear correlation between the decrease of the auto florescent area and the increase of the atrophic lesion area is showing that the atrophic lesion does growth.

Nathan L. Mata: But in those subjects that did grow atrophic lesions, you can see a very clear correlation between the decrease of the autofluorescent area and the increase of the atrophic lesion area, showing that the atrophic lesion does indeed grow certainly within the autophoresis zone, but nowhere else. So we have confined the lesion growth to within this zone, and we know that lesion growth from prior analyses is significantly lower than in There's only one subject, subject five, that grew an atrophic lesion outside of the initially identified autofluorescent area, and we believe that could be due to a reading error in the image software, which I'll get to right now. We typically use, and most people use, a software called the Heidelberg Region Finding Software.

Speaker Change: With.

Speaker Change: In the auto horses, but nowhere else. So we've confined lesion growth two within this zone and we know that lesion growth for prior analysis is significantly lower than in natural history. There's only one subject subject five that grew in atrophic lesion outside of initially identified auto florescent area, and we believe that could be due to.

Speaker Change: <unk> reading error of the image software, which I'll get to right now.

Heidelberg region: We typically use in most people use a software called the Heidelberg region. Finding software. This is a software that accompanies the imaging camera that allows ophthalmologists to grade lesions in the back of the eye retinal lesions. The problem with this software is that it is affected by human error, so humans have to add.

Nathan L. Mata: This is software that accompanies the imaging camera that allows ophthalmologists to grade lesions in the back of the eye, called retinal lesions. The problem with this software is that it is affected by human error. So humans have to actually look at the lesions and demarcate the zone of atrophy. And sometimes, readers don't agree. So you can have a case where there is a difference of opinion, and it has to go to an arbitrator.

Speaker Change: Actually look at the lesions and demarcate the zone of atrophy and sometimes readers don't agree. So you can have a case, where you have a difference of opinion and it has to go to an arbitrator. So this can be a very time consuming and error prone process. But this is what is being used today. Our reading center has developed a new algorithm for reading lesions, which does not rely on.

Nathan L. Mata: So this can be a very time-consuming and error-prone process, but this is what is being used today. Our reading center has developed a new algorithm for reading lesions that does not rely on subjective reader bias. In fact, it uses a mathematical classification of lesions based on the proximity of the lesion and the density to that of the optic disc, as well as healthy retinal tissue. And it focuses just on the six-millimeter macular area, which is the most important to look at when you're talking about visual acuity loss.

Speaker Change: On subjective reader bias in fact, it uses a mathematical classification of lesions based on the proximity of the lesion and the density to that of the optic disc as well as healthy retinal tissue and it focus is just on the six millimeter macular area, which is the most important to look at when Youre talking about visual acuity loss.

Nathan L. Mata: And as I said before, it's independent of reader biases. So it's looking at just pixel densities across the lesion area. And really, all the reader is doing is getting the data back from the software and reporting whatever the computer algorithm provided.

Speaker Change: And as I said before is independent of reader bias towards looking at just pixel densities across the lesion area and really all the reader is doing is getting the data back from the software and reporting whatever the computer algorithm are provided so I'm going to show you a re analysis of our data using this particular image grading software.

Nathan L. Mata: So I want to show you a reanalysis of our data using this particular image grading software. What we found, in fact, was that if we looked within the macular area using this new grading algorithm, we found that there were 12 eyes of eight subjects that did, in fact, have macular lesion involvement at baseline. And we monitored the lesion growth of the macular lesion of the patients over time, and you can see that on the left hand side.

Speaker Change: Sure.

Speaker Change: What we found in fact was it if we look within the macular area using this new grading algorithm, we find that there's 12 eyes of eight subjects that did in fact have macular lesion involvement at baseline and we monitored the lesion growth of them accurate lesions of the patients over time and you can see on the left hand side.

Nathan L. Mata: The solid lines and dots show you the actual data from the lesion growth, and the dotted line shows you a third-order polynomial fitted through the data so you can see the trend line. You can see it's very clear.

Speaker Change: The solid lines and dots show you the actual data from the lesion growth in the dotted line shows you a third or order polynomial fitted through the data. So you can see the trend line you can see it's very clear the lesions do grow from baseline outflow Gutman 16, but they're starting from a $16 24, there was absolutely no further growth of the lesion.

Nathan L. Mata: The lesions do grow from baseline out to about month 16, but starting from month 16 to month 24, there was absolutely no further growth of the lesions. And you can see on the right-hand side the percentage involvement of the atrophy within that 6-millimeter macular zone. The 100% would indicate that all 6 millimeters of that zone are occupied by atrophy. As you can see here, our subjects are showing no more than 7% encroachment of the atrophic lesion into the macula, and it's stable from 16 to 24 months.

Gutman: And you can see on the right hand side the percentage of involvement of the atrophy within that six millimeter macular zone. The 100% would indicate that all six millimeters of that zone are occupied by atrophy. As you can see here are subject of showing no more than a 7% encroachment of the atrophic lesion in the macula edits static.

Gutman: From 16 to 24 months.

Nathan L. Mata: So we're very pleased to report this data, and it is consistent with the stabilization of visual acuity that I showed you earlier. Finally, I want to talk a little bit about our Phase 3 study in geographic atrophy. It's important to note that the phase 3 trial design in Stargardt's disease and the phase 3 trial design in Stargardt's are very, very similar. They use the same dose. They have the same duration, two years, with the same interim analysis.

Speaker Change: Very pleased to report this data is consistent with the stabilization of visual acuity that I showed you earlier.

Speaker Change: Finally, I wanted to talk a little bit of our phase III study in geographic atrophy.

Speaker Change: It is important to note that the phase III trial design and start our disease and the phase III trial design and startups are very very similar they have the same dose.

Speaker Change: We have the same duration two years with the same interim analysis. There were the same two to one randomization and of course, we're looking at all the same safety and efficacy assessments that were looking at to judge the atrophic lesion growth and adverse events Theres only two differences in these studies first indication G. Instead of start ups and then secondly, a higher predicted.

Nathan L. Mata: There's the same two to one randomization, and, of course, we're looking at all the same safety and efficacy assessments that we look at to judge atrophic lesion growth and adverse events. There are only two differences in these studies. First, the indication, GA instead of Sargards. And secondly, a higher predicted enrollment population for the GA study to reflect the higher prevalence of the disease in the population. So with that, I'll turn it over to Halyan to discuss the financials. Thank you.

Speaker Change: Enrollment population for the <unk> study to reflect a higher prevalence of the disease in the population.

Speaker Change: So with that I'll turn it over to <unk> to discuss financials. Thank you.

Hao-Wan Zhang: Thank you, Nathan. So, in Q1 2024, we had R&D expenses of $6.8 million compared to $5.7 million in Q1 2023. The increase was primarily due to increasing expenses due to, first, conducting the DRAGON study, second, initiating the DRAGON 2 study, and third, wage and salary due to our R&D team expansion and share-based compensation granted in the third quarter of 2023. For G&A expenses in Q1 2024, G&A expenses were $1.6 million compared to $1.2 million in Q1 2023.

Nathan: Thank you Nathan.

Speaker Change: Yeah.

Nathan: So in Q1 2024, we had R&D expenses of $6 8 million compared to $5 7 million in Q1 2023.

Nathan: The increase was primarily due to increasing expenses due to first and that being a driving study second initiating the dragon two study in <unk>.

Nathan: Wage and salary due to our R&D team expansion and share based compensation granted in the third quarter of 2023.

Speaker Change: On G&A expenses in Q1 2019 for G&A expenses was one 6 million compared to $1 2 million in Q1 2023 <unk>.

R&D team: The increase was primary due to increase in share based compensation when during the third quarter of 2023.

R&D team: And then all we had a net loss of $7 9 million in Q1, 2024 compared to $6 9 million in Q1 2023.

Hao-Wan Zhang: The increase was primarily due to an increase in share-based compensation granted in the third quarter of 2022. On net loss, we had a net loss of $7.9 million in Q1 2024 compared to $6.9 million in Q1 2022. In terms of cash, we have a total of $95.5 million in cash and in investment in the short-term U.S. Treasury bill in Q1 2024. Let's compare that with $37.8 million in cash in Q1 2023. The increase was primarily due to last year's follow-on offering and the exercise of the warrants issued in the follow-on offering related to our ATM offering.

Speaker Change: In terms of cash we had totaled $95 5 million in cash any investment in short term U S. Treasury Bill in Q1 2094.

Speaker Change: Compared with $778 million in cash in Q1 2023.

Speaker Change: The increase was finally due to last year's follow on offering and the exercise of the warranties unit volume offering and our ATM offering.

Hao-Wan Zhang: In Q1 2024, we raised $12.5 million from the exercise of the Warren Issue in the follow-on offering and ATM model. In addition, we raised an additional $25 million from our Registered Red offering in April to expand cash runways beyond 2026. Thank you. That's you, Tom.

California: In Q1, 'twenty 'twenty four we raised California 5 million on the exercise of the warrant issued the final offering an ATM offering.

California: In addition, we raised additional 25 million registered direct offering in April.

Speaker Change: We expect cash runway beyond 2026.

Speaker Change: Thank you Tom.

al: Thanks Al.

Tom Lin: I'd like to conclude with the key milestones to expect for this year. We are still making good progress in the Phase 3 in GA. Many sites have been initiated and are enrolling subjects, and more sites will be initiated. Income data for the phase 3 study in Starless Disease is expected to be in December this year or early next year, depending on data collection and when the DSMB can convene.

California: That could conclude what the key milestones to expect for this year.

California: We are still making good progress in the phase III G. H many sites have been initiated.

Speaker Change: While these subjects and more sites will be initiated.

Sidney: Interim data for Phase III study installer Sidney.

Sidney: It could be in December this year or early next year, depending on data collection and when the TSA and P. K Cup game.

Tom Lin: Thank you for participating. And we'll leave some time for Q&A. Thank you.

Speaker Change: Thank you for participating and.

Sidney: Well Nicole estimate some time for Q&A. Thank you.

Operator: Our first question comes from Yi Chen, with HC Wainwright. Yi, your line is now open.

Sidney: Our first question comes from E. Chen with H C. Wainwright. Your line is now open.

Yi Chen: Hi, thank you for taking my question. With respect to the novel grading algorithm, is it being deployed in both DRAGON1 and DRAGON2 trials?

Yi Chen: Hi, and thank you for taking my question with respect to the novel grading algorithm is it being deployed in both direct and one in Dragon two trials.

Nathan L. Mata: Hi Yi, this is Nathan Mata. I'll answer the question. So we have not yet formally deployed the grading algorithm in either clinical study. We are going to speak with the FDA first about a validation process to determine how they would like us to proceed with this new algorithm in terms of demonstrating its robustness and reliability. That meeting will occur within the next month or so, but there is a chance, there's every chance that obviously we can implement it before the end of the study and retrospectively grade the images once we have FDA's approval to use it as a formal grading analysis. It will always be combined with whatever or be compared to, I should say, what we obtained with the Heidelberg region finding software.

Yi Chen: Oh, Hi, this is Nathan Manav I'll answer the question. So we have not yet formally deployed the grading algorithm in either clinical study, we are going to speak with the FDA first about a validation process to determine how they would like US to proceed with this new algorithm in terms of demonstrating its robustness and reliability.

Nathan L. Mata: That meeting will occur within the next month or so but there is a chance. There's every chance of obviously, we can implemented before end of study and retrospectively grade the images. Once we have FDA approval to use it as a formal a grading analysis. It will always be combined with whatever our be compared to I should say with what we obtained with the Heidelberg.

Heidelberg region: Our region finding software.

Nathan L. Mata: Okay, and to follow up with the DRAGON1 and DRAGON2 trials, do you intend to enroll patients with at least some degree of atrophic lesions in both trials?

Heidelberg region: Okay.

Heidelberg region: And.

Speaker Change: To follow up with the drug and one on drug into trials and do you intend to enroll patients with at least some degree of atrophic lesion and bulk trumps Oh, yes, Oh, you'll suddenly firm for our phase III studies, where the endpoint of course is slowing the growth of the atrophic lesions all subjects will come in with some measure.

Nathan L. Mata: Oh yes, oh yes, certainly for our phase 3 studies where the end point, of course, is slowing the growth of the atrophic lesions, all subjects will come in with some measure of atrophy at baseline, but again, as part of our differentiation, we are picking patients with smaller lesions at baseline because we believe that early intervention will be a more appropriate sort of approach for this particular disease, both diseases, GA and Stargardt's.

Speaker Change: Of atrophy at baseline, but again as part of our differentiation, we're taking patients with smaller lesions at baseline because we believe that early intervention will be a more appropriate sort of approach offer for this this particular disease. Both of these is G eight and starts.

Nathan L. Mata: The studies suggest that earlier stage patients without a trophic lesion may not be a suitable population for the treatment. But that's not the case. The case is actually a more regulatory concern.

Speaker Change: Does that suggest that are earlier stage patients with without atrophic lesion may not be a suitable population, Florida treatment.

Nathan L. Mata: That's not the case. The case is actually a regulatory concern because the agency, FDA, and even EMA are not convinced that autofluorescence in and of itself is actually causing photoreceptor cell death or dysfunction, whereas atrophic lesions represent dead retina, and of course, that will lead to loss of vision. So until there's more clinical data to demonstrate that autofluorescence by itself is actually affecting photoreceptor function, and we have some of that data, as I mentioned in the presentation, you know, we have these kids who have autofluorescent lesions at baseline.

Florida treatment: That's not the case the cases actually are more regulatory concern because the agency F. D E and even E. M. E are not convinced that auto fluorescence in of itself is actually causing photoreceptor cell death or dysfunction, whereas atrophic lesions represent dead retina and of course that will lead to loss of vision, so until there's more clear.

Speaker Change: <unk> data to demonstrate that auto fluorescence by itself is actually affecting photoreceptor function and we have some of that data as I mentioned in the presentation. You know we have these kids who have auto fluorescent lesions at baseline. They don't have atrophy many of them, but they are losing vision. So we'll need more data like that to convince the agency that in fact, the auto fluorescence is impacting a photoreceptor function.

Nathan L. Mata: They don't have atrophy, many of them, but they're losing vision. So we'll need more data like that to convince the agency that, in fact, the autofluorescence is impacting photoreceptor function. Then it would be a valid endpoint. But we've shown here a slowing of the transition from the autofluorescent lesion to the atrophic lesion, and then once the atrophic lesions are formed, a slowing of the growth of those lesions. So we believe, in both contexts, that slowing the transition as well as slowing the growth of the atrophic lesions, this treatment approach is appearing to be effective in both of those different scenarios. Got it. Thank you.

Speaker Change: <unk> then it would be a valid endpoint, but we've shown you here.

Speaker Change: A slowing of the transition from the auto horse lesions atrophic lesion and then once neutral deletions are formed a slowing of growth of those lesions. So we believe that both context of slowing the transition as well as slowing the growth of the atrophic lesions. This of this treatment approach.

Speaker Change: Is appearing to be effective at atmos at both of those are different scenarios.

Speaker Change: Got it thank you.

Speaker Change: Sure.

Operator: As a reminder, if you would like to ask a question, please raise your hand. Our next question comes from Mark Goodman with Lyrinc Partners. Mark, your line is now open.

Speaker Change: As a reminder, if you would like to ask a question. Please raise your hand.

Speaker Change: Our next question comes from Marc Goodman with Leerink partners Mark airline is now open.

Operator: Hi, good afternoon. This is Basma on behalf of Mark.

Basmala: Hi, Good afternoon. This is basmala on for Mike.

Basma Mahmoud Radwan Ibrahim: We have a question regarding the interim readout. Can you remind us again of your regulatory plans if the interim is positive? And again, a positive interim, does it mean that the separation between the treatment arm and the placebo arm has to be statistically significant? That's our first question, and we have a follow-up question.

Basmala: We have a question regarding the interim readout can you remind us again of your regulatory plans AIDS. The Annan is positive and again a positive interim doesn't mean that the separation between the treatment arm and the placebo arm have to be statistically significant.

Basmala: Our first question and we do have a follow up question.

Nathan L. Mata: Hi Basma, this is Nathan. I'll answer the question. So the way the interim analysis will be handled; it will be independently assessed by our DSMB; ourselves on the sponsor side will remain masked. Hence we will not know the treatment effect, nor can we announce a particular treatment effect. The DSMB will do an analysis based upon a predefined statistical window that tells us whether or not we need to add patients. So if we don't need to add patients, there's a very good chance we've fallen within the statistical window in which the treatment effect would be consistent with what the FDA would approve that is 20% or greater.

Nathan L. Mata: Yeah, Hi, Boswell. This is Nathan I'll answer the question. So the way the interim analysis will be handled it will be it will be independently.

Nathan: Assessed by our D S M B.

Nathan: Ourselves on the sponsor side will remain math, so we will not know the treatment effect, nor can we announce a particular treatment effect. The DSM V will do an analysis based upon a pre defined statistical window that tells us whether or not we need to add patients. So if we don't need to add patients is a very good chance, we'd fallen within the statistical window in which the treatment.

DSM V: Effect would be consistent with what something the FDA would approve that is a 20% or greater if we are asked to add patients that means we're not at that particular point yet.

Nathan L. Mata: If we are asked to add patients, that means we're not at that particular point yet. So we would be adding more patients to sort of increase the conditional power. I should mention that that statistical analysis was developed when we planned the enrollment at 90 subjects, but we have since over-enrolled the study at 104 subjects. So we actually already have a buffer of subjects that we probably won't need to add. So I'm pretty confident that the number, that is, the treatment effect number, will be consistent with our statistical window.

DSM V: So we would be adding more patients to sort of increase the conditional power I should mentioned that that statistic that statistical analysis was a developed when we filed the enrollment at 90 subjects. We had since over enrolled the study at 104 subjects. So we actually already have a buffer of subjects that that probably will look we won't need to add so I'm pretty confident.

Speaker Change: Didn't that number that is the the treatment effect number will be consistent with our statistical window. There is an outcome, where we are not in the statistical window and it would be futile to add patients, but this is a non binding futility. So if we do get that outcome. We will still continue the trial to the end of two years because it is very likely that.

Nathan L. Mata: There is an outcome where we are not in the statistical window and it would be futile to add patients, but this is a non-binding futility. So, if we do get that outcome, we will still continue the trial to the end of two years because it is very likely that you could get a better treatment effect during the second year of study. So those are the three different outcomes. I hope that was clear for you, Basma.

DSM V: You could get a better treatment effect during the second year of study. So those are the three different outcomes I hope that was that was clear for your Boswell.

Basma Mahmoud Radwan Ibrahim: Oh, right, so like you're not gonna... If, okay, so my understanding now is that if there's a positive outcome, there's no change in plans. There's no change in enrollment.

DSM V: Ryan did I cannot then.

DSM V: Thanks.

DSM V: Okay. So my understanding now is that it is a positive outcome. There is no change in plans, there's no season enrollments and okay great.

Nathan L. Mata: And Okay. Thank you. Our follow-up questions regarding the five out of 12 patients with pathogenic variants that you showed that did not develop any atherosclerosis throughout the 24 months of the phase two trial. Can you remind us again, patients with these kinds of variants, based on natural history studies, how long does it really take to develop atrophic lesions from QGF to GCF, just to know the treatment effects, to have a better understanding of the treatment effects?

DSM V: Correct.

Ryan Smith: A follow up question regarding the spy violent out of 12 patients with pathogenic variants that you show that did not develop any of those equations to either 24 months of the beta trial can you remind us again operation with east kind.

Speaker Change: Variance based on natural history studies, how long does it take them ready to develop a topic a topic lesions from <unk> and <unk> just to know.

Speaker Change: I think that effect start to have a better understanding about it.

Nathan L. Mata: You know, it really depends on their baseline status. So, if you look at the baseline status of our subjects, the size of their autofluorescent lesions predicts growth within two years. That means it predicts atrophic lesion growth within two years. So, the majority of subjects should have had atrophic lesion growth. There are probably two exceptions.

Speaker Change: You know it really depends on on their baseline status. So if you look at the baseline satisfy our subjects and the size of their auto fluorescent lesions predicts growth within two years I think that means predicts atrophic lesion growth within two years. So the majority of subjects should have had atrophic lesion Gulf theirs.

Nathan L. Mata: I can't identify them by number because I don't have the data in front of me, but I believe there were two that had relatively small areas of the autofluorescent lesion, but it was encroaching on the fovea, so they're still losing vision. But the short answer is, in our cohort, it was expected that the majority of subjects, at least 75% of subjects, would have converted by two years would have converted to an

Nathan L. Mata: Two subjects I can't identify them by numbers I don't have the data in front of me, but I believe there was two that had relatively small areas of of auto fluorescent lesion, but it was encroaching the fovea, so theres still losing vision, but the short answer is in in our cohort. It wouldn't have expected that the majority of subjects at least 75.

Speaker Change: 5% of subjects would have converted by two years when converted to in atrophic lesions. So the fact that we're seeing 42% of subjects not convert is actually a very very promising findings. In addition to actually slowing the growth of atrophic incident lesions once they are formed.

Nathan L. Mata: So, the fact that we're seeing 42% of subjects not convert is actually a very, very promising finding, in addition to actually slowing the growth of atrophic incident lesions once they are formed. Thank you. Thank you so much.

Basma Mahmoud Radwan Ibrahim: Thank you.

Nathan L. Mata: Thank you.

Nathan L. Mata: Okay.

Operator: This now concludes our Q&A portion of the call. I would like to turn the call back over to Tom for final remarks.

Basma Mahmoud Radwan Ibrahim: This now concludes our Q&A portion of the call I would like to turn the call back over to Tom for final remarks.

Tom Lin: Well, thank you, everyone, for joining this call and asking questions about the trial. Please look forward to more updates from us, and as we're making good progress on both studies. Thank you very much, and we'll see you soon.

Tom Lin: Well. Thank you everyone for joining this call and our muskingum questions on the trial.

Tom Lin: I'll look forward to more updates from us and as we're making good progress on both studies. Thank you very much and we'll see you soon.