Q3 2024 Veru Inc Earnings Call

August 8, 2024

Credit Roll

?? ?? ?? ?? ??

Operator: Good morning, ladies and gentlemen, and welcome to Veru Inc's investors conference call.

Operator: Good morning, ladies and gentlemen, and welcome to Veru, Inc.'s investors conference call. All participants will be in the Sonali mode. Should you need assistance, please contact a conference specialist by pressing the star key followed by zero. Please note, this event is being recorded. I would now like to turn the conference over to Mr. Sam Fisch, Veru Winks, Executive Director of Investor Relations and Corporate Communications. Please go ahead.

Operator: Good morning, ladies and gentlemen, and welcome to Veru, Inc.'s investors conference call. All participants will be in the Sonali mode.

Operator: All participants will be in the Sonali mode. Should you need assistance, please know a conference specialist repressing the star key, followed by zero. After this morning's discussion, there will be an opportunity to ask questions.

Speaker Change: Good morning, ladies and gentlemen, and welcome to Veru, Inc.'s Investors Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

Operator: Should you need assistance, please contact a conference specialist by pressing the star key followed by zero. After this morning's discussion, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Mr. Sam Fisch, and to Ms. Vera Winks, Executive Director of Investor Relations and Corporate Communications. Please do so.

Operator: Please note, this event is being recorded.

Speaker Change: After this morning's discussion, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Mr. Sam Fisch, Veru, Inc.'s Executive Director, Investor Relations and Corporate Communications. Please go ahead.

Operator: But now it's time to conference over to Mr. Sam Fish, Veru Inc.'s executive director, investor relations, and corporate communications. Please go ahead.

Samuel Fisch: Good morning. The statements made on this conference call may be forward-looking statements.

Samuel Fisch: Good morning. The statements made on this conference call may be forward-looking statements. Forward-looking statements may include, but they're not necessarily limited to, statements of the company's plans, objectives, expectations, or intentions regarding its business, operations, regulatory interactions, finances, and development and product portfolio. Such forward-looking statements are subject to known and unknown risks and uncertainties, and our actual results may differ significantly from those projected, suggested, or included in any forward-looking statement. Risks that may cause actual results or developments that differ materially are contained in our 10-Q and 10-K SEC filings, as well as in our press releases from time to time. I would now like to turn the conference call over to Dr. Mitchell Steiner, VeriWings Chairman, CEO, and President.

Sam Fisch: Good morning. The statements made on this conference call may be forward-looking statements.

Speaker Change: Forward-looking statements may include, but are not necessarily limited to, statements of the company's plans, objectives, expectations, or intentions regarding its business, operations, regulatory interactions, finances, and development and product portfolio.

Samuel Fisch: Such forward-looking statements are subject to known and unknown risks and uncertainties, and actual results may differ significantly from those projected, suggested, or included in any forward-looking statements. Writs that may cause actual results or developments that differ materially are contained in our 10-Q and 10-K SEC filings, as well as in our press releases from time to time.

Sam Fisch: Such forward-looking statements are subject to known and unknown risks and uncertainties, and our actual results may differ significantly from those projected, suggested, or included in any forward-looking statements.

Speaker Change: Risks that may cause actual results or developments that differ materially are contained in our 10-Q and 10-K SEC filings, as well as in our press releases from time to time. I would now like to turn the conference call over to Dr. Mitchell Steiner, Veriwings Chairman, CEO , and President.

Mitchell Steiner: I would now like to turn the conference call over to Dr. Mitchell Steiner, Veru Inc.'s chairman, CEO, and president. Good morning. With me on this morning's call, Dr. Gary Barnett, Chief Scientific Officer; Michelle Greco, Chief Financial Officer and Chief Administrative Officer; Michael Purface, the General Counsel and Executive Vice President of Corporate Strategy; and Sam Fish, Executive Director of Investive Relations and Corporate Communications. Thank you for joining our Q3 Fiscal Year 2024 earnings call. Veru is a late clinical stage biopharmaceutical company focused on developing innovative medicines for high quality weight loss, oncology, and acute respiratory distress syndrome.

Mitchell Steiner: Good morning. With me on this morning's call are Dr. Gary Barnett, Chief Scientific Officer; Michele Greco, Chief Financial Officer and Chief Administrative Officer; Michael Purvis, the General Counsel and Executive Vice President of Corporate Strategy; and Sam Fisch, Executive Director of Investor Relations and Corporate Communications. Thank you for joining our Q3 Fiscal Year 2024 Earnings Call.

Samuel Fisch: Good morning. With me on this morning's call are Dr. Gary Barnett, Chief Scientific Officer; Michele Greco, Chief Financial Officer and Chief Administrative Officer; Michael Purvis, the General Counsel and Executive Vice President of Corporate Strategy; and Sam Fisch, Executive Director of Investor Relations and Corporate Communications. Thank you for joining our Q3 Fiscal Year 2024 earnings call.

Mitchell Steiner: Good morning.

Speaker Change: With me on this morning's call are Dr. Gary Barnett, Chief Scientific Officer, Michele Greco, Chief Financial Officer and Chief Administrative Officer, and Dr. William Wood, Chief Administrative Officer.

Speaker Change: Michael Purvis, the General Counsel and Executive Vice President of Corporate Strategy, and Sam Fisch, Executive Director of Investor Relations and Corporate Communications. Thank you for joining our Q3 Fiscal Year 2024 Earnings Call.

Mitchell Steiner: Veru is a late clinical stage biopharmaceutical company focused on developing innovative medicines for high quality weight loss, oncology, and acute respiratory distress. The company's drug development pipeline includes two late-stage inovo-oral small molecules, Inovasarm, and Subizibutol. In our weight loss pipeline, we have Inovasarm, also known as Ostarine, MK-2866, GTX-024, and Veru-024, which is an oral selective angioreceptor modulator, SARM for short. Novosarum is being developed as a treatment in combination with a weight loss drug like a glucagon-like peptide 1 receptor agonist, also known as a GLP-1 receptor agonist, to augment fat loss and avoid muscle loss in overweight or obese patients for chronic weight management.

Samuel Fisch: Veru is a late clinical stage biopharmaceutical company focused on developing innovative medicines for high quality weight loss, oncology, and acute respiratory distress syndrome. In our weight loss pipeline, we have NovoSARM, also known as OSTERI, MK2866, GTX024, and Veru024, which is an oral selective angioreceptor modulator, SARM for short. In our Infectious and Inflammatory Disease Pipeline, and similarly, pending additional external funding or pharmaceutical partnership, we have Sabizavulin, a microtubule disruptor, which is a planned Phase III clinical trial for the treatment of hospitalized patients with viral-induced ARTS.

Samuel Fisch: And the company also has an FDA-approved commercial product, the FC2 Female Condom Internal Condom for dual protection against unplanned pregnancy and sexually transmitted infections. This morning, we'll provide an update on the current focus of our company, which is the development of Inobosarum, an oral SARM in combination with Rigobit, which is a semaglutide, a GLP-1 receptor agonist, to preserve muscle mass and to augment fat loss for We'll also provide financial highlights for our third quarter of fiscal year 2024.

Mitchell Steiner: In our oncology pipeline, and pending additional external funding or pharmaceutical partnership, we have Inovasarm in combination with Abemacyclob as a second-line treatment for angioreceptor positive, estrogen receptor positive, and human epidermal growth factor 2 negative metastatic breast cancer. In our Infectious Inflammatory Disease Pipeline, and similarly, pending additional external funding or pharmaceutical partnership, we have Subizubulin, a The company also has an FDA-approved commercial product, the FC2 Female Condom Internal Condom, for dual protection against unplanned pregnancy and sexually transmitted infections.

Speaker Change: Veru is a late clinical stage biopharmaceutical company focused on developing innovative medicines for high quality weight loss, oncology, and acute respiratory distress syndrome.

Mitchell Steiner: Company's drug development pipeline includes two late-stage and novel oral small molecules and Novosarm and submissive urine. In our weight loss pipeline, we have a Novosarm, also known as Austrian MK2866, GTX-024, and Veru-024, which is an oral selective angioreceptive modulator, SARM for short. Novosarm's being developed as a treatment and combination with a weight loss drug, like a glucagon, like peptide-1 receptor agonist, also known as a GLP-1 receptor agonist, to augment fat loss and to avoid muscle loss in overweight or obese patients for chronic weight management. In our oncology pipeline and pending additional external funding or pharmaceutical partnership, we have a Novosarm in combination with a Bemicyclub as a second-line treatment, an antireceptive positive, estrogen-receptive positive, and human epidermal growth factor of two negative metastatic breast cancer.

Speaker Change: The company's drug development pipeline includes two late-stage inovo-oral small molecules, Inovasarm and Subizibutalin.

Speaker Change: In our weight loss pipeline, we have Inovasarm, also known as Osterine, MK-2866, GTX-024, and Veru-024, which is an oral selective angioreceptor modulator, SARM for short.

Speaker Change: Novosarum is being developed as a treatment in combination with a weight loss drug.

Speaker Change: like a glucagon-like peptide 1 receptor agonist, also known as a GLP-1 receptor agonist, to augment fat loss and to avoid muscle loss in overweight or obese patients for chronic weight management.

Speaker Change: In our oncology pipeline, and pending additional external funding or pharmaceutical partnership, we have Inovasarm in combination with Abemacyclob as a second-line treatment for angioreceptive-positive, estrogen-receptive-positive, and human epidermal growth factor 2 negative metastatic breast cancer.

Mitchell Steiner: In our infectious and inflammatory disease pipeline and similarly pending additional external funding or pharmaceutical partnership, we have Subbizivulant, a microtubule disruptor, which is a planned Phase three clinical trial for the treatment of hospitalized patients with viral induced ARDS. The company also has an FDA-proof commercial product, the FC-2 female condom and terminal condom, for dual protection against unplanned pregnancy and sexually transmitted infections. This morning, we'll provide an update on the current focus of our company, which is the development of a Novosarm, an oral psalm in combination with the gobeat, which is potentially higher-quality weight loss. We'll also provide financial highlights for our third quarter fiscal year in 2024.

Speaker Change: In our Infectious Inflammatory Disease Pipeline, and similarly, pending additional external funding of pharmaceutical partnership, we have Subizivulin, a microtubule disruptor, which is a planned Phase III clinical trial for the treatment of hospitalized patients with viral-induced ARDS.

Speaker Change: The company also has an FDA approved commercial product, the FC2 Female Condom Internal Condom for dual protection against unplanned pregnancy and sexually transmitted infections.

Mitchell Steiner: This morning, we'll provide an update on the current focus of our company, which is the development of Inobosarm, an oral SARM in combination with Rigobi, which is semaglutide, a GLP-1 receptor agonist, to preserve muscle mass and to augment fat loss for a potentially higher quality weight loss. We'll also provide financial highlights for our third quarter of fiscal year 2024.

Samuel Fisch: Therefore, if an ovus arm is given with a Glucagon receptor agonist, the combination utilizes two different mechanisms to increase the loss of fat. Also, Enobosarum builds and heals bone, providing another potential benefit to treat bone loss, which is also known as osteoporosis, to prevent fractures. And those from his previous studies in five clinical studies that measured muscle as an endpoint involving 968 older men and post-menopausal women, as well as older patients who have muscle wasting because of advanced cancer.

Speaker Change: This morning, we'll provide an update on the current focus of our company.

Speaker Change: which is the development of a novus arm.

Speaker Change: and Oral Sarum in combination with Rigobite, which is a semi-glutide, a GLP-1 receptor agonist to preserve muscle mass.

Speaker Change: and to augment fat loss for a potentially higher quality weight loss. We'll also provide financial highlights for our third quarter fiscal year 2024.

Mitchell Steiner: Lymphoid receptor agonists, which include Azempic, Wigovi, Step-Bound, and Monjoro, are very effective drugs that cause significant weight loss. Unfortunately, up to 50% of the total weight loss comes from muscle, which is problematic, as muscle is necessary not only for strength and physical function, but also as a metabolic tissue that may play a role in allowing higher quality weight loss. To clarify this point, muscle preservation may assist in high-quality weight loss in three ways.

Mitchell Steiner: We'll look for receptor agonists, which include an ozemic, gobeat, stepbound, and majoro, with very effective drugs that cause significant weight loss. Unfortunately, up to 50% of the total weight loss comes from muscle, which is problematic. As muscle is necessary not only for strength and physical function, but also muscle is a metabolic tissue that may play a role in allowing a higher-quality weight loss.

Speaker Change: Lymph 1 receptor agonists, which included Zempik, Rigovi, Stefano, and Mangiaro.

Speaker Change: are very effective drugs that cause significant weight loss.

Speaker Change: Unfortunately, up to 50% of the total weight loss comes from muscle, which is problematic, as muscle is necessary not only for strength and physical function, but also muscle is a metabolic tissue that may play a role in allowing a higher quality weight loss. To clarify this point, muscle preservation may assist.

Mitchell Steiner: To clarify this point, muscle preservation may assist in higher-quality weight loss in three ways. First, we need a drug that, given in combination with a Glypholim receptor agonist, will prevent the loss of muscle caused by Glypholim receptor agonist to deserve physical function in older adults who had a risk for muscle loss and who are overweight and obese. According to the CDC, 42% of older adults have obesity in the United States and could benefit from weight loss medication. Up to 34% of obese patients over the age of 60 have sarcopenic obesity. Sarcopenic being the age-related loss of muscle.

Mitchell Steiner: First, we need a drug that, given in combination with a glucose receptor agonist, will prevent the loss of muscle caused by a glucose receptor agonist to preserve physical function in older adults who are at risk for muscle loss and who are overweight and obese. According to the CDC, 42% of older adults in the United States are obese and could benefit from weight loss medication. Up to 34% of obese patients over the age of 60 have sarcopenic obesity, sarcopenia being the age-related loss of muscle.

Speaker Change: in High-Quality Weight Loss in Three Ways. First, we need a drug that, given in combination with a glycoin receptor agonist, will prevent the loss of muscle caused by a glycoin receptor agonist to preserve physical function in older adults who are at risk for muscle loss and who are overweight and obese.

Speaker Change: According to the CDC, 42% of older adults have obesity in the United States and could benefit from weight loss medication.

Speaker Change: Up to 34% of obese patients over the age of 60 have sarcopenic obesity, sarcopenia being the age-related loss of muscle.

Mitchell Steiner: This large subpopulation of sarcopenic obese patients is especially at risk when taking a glucose receptor drug for weight loss as they may already have critically low amounts of muscle due to age-related muscle loss. Because of the magnitude and speed of muscle loss, while on a glucose receptor agonist therapy for weight loss, glucose receptor agonist drugs may accelerate the development of frailty and muscle weakness in obese or overweight elderly patients. Muscle weakness may lead to poor balance, decreased gait speed, mobility disability, loss of independence, and higher risk for falls and fractures.

Mitchell Steiner: This large subpopulation of sarcopenic obese patients is especially at risk when taking a Glypholim receptor drug for weight loss, as they may already have critically low amounts of muscle due to age-related muscle loss. Because of the magnitude and speed of muscle loss, while on a Glypholim receptor agonist therapy for weight loss, Glypholim receptor agonist drugs may accelerate the development of frailty and muscle weakness in obese and overweight elderly patients. Muscle weakness may lead to poor balance, decreased skate speed, mobility disability, loss of independence, and high risk of falls and fractures. In fact, the safety section of the package insert for regover has been updated based on the recently reported select cardiovascular outcome clinical trial, which now highlights a 400% increase in pelvic and hip fractures that were observed in patients greater than the age of 75 years receiving regover compared to placebo patients, and that was 2.4% versus 0.6%.

Speaker Change: This large subpopulation of sarcopenic obese patients is especially at risk when taking a glyphosate-receptive drug for weight loss as they may already have critically low amounts of muscle due to age-related muscle loss.

Speaker Change: Because of the magnitude and speed of muscle loss, while on a GLP1 receptor agonist therapy for weight loss, GLP1 receptor agonist drugs may accelerate the development of frailty and muscle weakness in obese or overweight elderly patients.

Speaker Change: Muscle weakness may lead to poor balance, decreased gait speed, mobility disability.

Mitchell Steiner: In fact, the safety section of the package insert for Rigovi has been updated based on the recently reported Select Cardiovascular Outcome Clinical Trial, which now highlights a 400% increase in pelvic and hip fractures that were observed in patients greater than the age of 75 years receiving Rigovi compared to placebo patients, and that was 2.4% versus 0.6%. Fractures of the hip and pelvis typically occur because of falls, which increase or decrease muscle mass.

Speaker Change: Loss of independence and higher risk for falls and fractures.

Speaker Change: In fact, the safety section of the package insert for Bgovi has been updated based on the recently reported Select Cardiovascular Outcome Clinical Trial, which now highlights a 400% increase.

Speaker Change: in pelvic and hip fractures that were observed in patients greater than the age of 75 years receiving Rigovi compared to placebo patients, and that was 2.4% versus 0.6%. Fractures of the hip and pelvis typically occur because of falls which increase or decrease muscle mass.

Mitchell Steiner: Practures of the hip and pelvis typically occur because of falls, which increase with decreased muscle mass. Second, for all patients who are overweight or obese, muscle preservation may prevent a Glypholim receptor with agonist weight loss plateau. Significant depletion of muscle mass may also be one of the reasons why patients with Glypholim receptor agonist drugs reach a weight loss plateau, meaning the rate of weight loss slows or stops while taking it with one receptor agonist drug. The hypothesis is that loss of muscle creates a muscle deficit that causes low energy balance and triggers in the brain's signal to increase appetite that counters the inhibition of appetite.

Mitchell Steiner: Second, for all patients who are overweight or obese, muscle preservation may prevent the GLPT1 receptor agonist weight loss plateau. Significant depletion of muscle mass may also be one of the reasons why patients with GLPT1 receptor agonist drugs reach a weight loss plateau, meaning the rate of weight loss slows or stops while taking a GLPT1 receptor agonist drug. The hypothesis is that loss of muscle creates a muscle deficit that causes a low energy balance and triggers in the brain a signal to increase appetite that counters the inhibition of appetite of GLPT1 receptor agonist drugs, thus leading to the weight loss plateau.

Speaker Change: Second, for all patients who are overweight or obese, muscle preservation may prevent the GLP1 receptor agonist weight loss plateau. Significant depletion of muscle mass may also be one of the reasons why patients with GLP1 receptor agonist drugs reach a weight loss plateau.

Speaker Change: Meaning, the rate of weight loss slows or stops while taking a glucose receptor agonist drug. The hypothesis is that loss of muscle creates a muscle deficit that causes a low energy balance and triggers in the brain a signal to increase appetite that counters the inhibition of appetite.

Mitchell Steiner: Glypholim receptor agonist drugs thus leading to the weight loss plateau. Without a muscle deficit, Glypholim drugs may maintain the loss of appetite and reduction of calorie consumption, which may potentially remove more fat mass with greater weight loss. Third, for all patients who are overweight or obese, muscle depletion may trigger the overeating that occurs in the patient discontinues a Glypholim receptor agonist, resulting in a rebound weight gain. That is, they regain their original weight, but now they regain weight as composed almost all of fat. Having a drug that maintains adequate muscle reserve when a Glypholim receptor drug is discontinued may prevent this rebound weight gain and help with the maintenance of weight loss.

Mitchell Steiner: Without a muscle deficit, GLPT1 drugs may maintain the loss of appetite and reduction of calorie consumption, which may potentially remove more fat mass with greater weight loss. Third, for all patients who are overweight or obese, muscle depletion may trigger the overeating that occurs when the patient discontinues a GLPT1 receptor agonist, resulting in a rebound weight gain. That is, they regain their original weight, but now the regained weight is composed almost entirely of fat.

Speaker Change: Clit-1 Receptor Agonist Drugs

Speaker Change: Thus leading to the weight loss plateau. Without a muscle deficit, glyphosate drugs may maintain the loss of appetite and reduction of calorie consumption, which may potentially remove more fat mass with greater weight loss.

Speaker Change: Third, for all patients who are overweight or obese, muscle depletion may trigger the overeating that occurs when the patient discontinues a glucose receptor agonist, resulting in a rebound weight gain.

Speaker Change: That is, they regained their original weight, but now the regained weight is composed almost all of fat.

Mitchell Steiner: Having a drug that maintains adequate muscle reserve when a GLP1 receptor drug is discontinued may prevent this rebound weight gain and help with the maintenance of weight loss. We believe that Inovasarm, our novel oral selective antireceptive modulator, may be the best drug candidate to address this urgent unmet medical need to preserve muscle in patients receiving a GLP1 receptor agonist for weight loss. Data from our clinical trials and preclinical studies support Inovasarm's potential. Inovasarm is given as a once-a-day oral dose. Inovasarm works through the androgen receptor in a well-established mechanism.

Speaker Change: Having a drug that maintains adequate muscle reserve when a glycolytic receptor drug is discontinued may prevent this rebound weight gain and help with the maintenance of weight loss.

Mitchell Steiner: We believe that a novice arm or a novel oral selective energy receptor modulator may be the best drug candidate to address this urgent unmet medical need to preserve muscle and patients receiving a Glypholim receptor agonist for weight loss. Thomas. Data from our clinical trials and pre-clinical studies support a novosarmic potential. Novosarm is given as a once-a-day oral dose, and Novosarm works through the engine receptor, and well-established mechanism. Novosarm demonstrates tissue-selectivity as it improves and preserves the lean body mass, muscle mass, and physical function. In addition, novosarm also directly causes a breakdown of fat and prevents storage of fat, resulting in a decrease in fat mass.

Mitchell Steiner: Inovasarm demonstrates tissue selectivity as it improves and preserves lean body mass, muscle mass, and physical function. In addition, Inovasarm also directly causes a breakdown of fat and prevents the storage of fat, resulting in a decrease in fat mass. This represents a different, non-overlapping mechanism of drug action to reduce fat that's distinct from a GLP-1 receptor agonist, which suppresses appetite, resulting in a low-caloric state. Therefore, if Inovasarm is given with a glycoin receptor agonist, the combination utilizes two different mechanisms to increase the loss of fat. Also, Enobosarum builds and heals bones, providing another potential benefit to treat bone loss, which is also known as osteoporosis, to prevent fractures.

Speaker Change: We believe that Inovasarm, our novel oral selective antireceptive modulator, may be the best drug candidate to address this urgent unmet medical need to preserve muscle in patients receiving a clip-on receptor agonist for weight loss.

Speaker Change: Data from our clinical trials and preclinical studies support Nobus Arma's potential.

Speaker Change: Inovasarm is given as a once-a-day oral dose. Inovasarm works through the androgen receptor, a well-established mechanism. Inovasarm demonstrates tissue selectivity as it improves and preserves lean body mass, muscle mass, and physical function.

Speaker Change: in addition and thoseice ar'm also directly causes a breakdown a fat and prevent storage of fat resulting in a decrease in fat mass

Mitchell Steiner: This represents a different non-overlapping mechanism of the drug action to reduce fat, as distinct from the GLP-1 receptor agonist, which suppresses acid and which suppresses appetite, resulting in a low caloric state. Therefore, if a novosarm is given with the glib-1 receptor agonist, the combination utilizes two different mechanisms to increase the loss of fat. Also, an novosarm builds and heals bone, providing another potential benefit to treat bone loss, which is also known as osteoporosis, to prevent fractures. Novosarm has been previously studied, and five clinical studies that measured muscle as an end point, involving 968 older men and postmenopausal women, as well as older patients who have muscle wasting because of advanced cancer.

Speaker Change: This represents a different, non-overlapping mechanism of drug action to reduce fat that is distinct from a GLP-1 receptor agonist, which suppresses appetite, resulting in a low-caloric state.

Speaker Change: Therefore, if a novus arm is given with a glyph 1 receptor agonist, the combination utilizes two different mechanisms to increase the loss of fat.

Speaker Change: Also, an oboe's arm builds and heals bone, providing another potential benefit to treat bone loss, which is also known as osteoporosis, to prevent fractures.

Mitchell Steiner: The NOSARM has been studied in five clinical studies that measured muscle as an endpoint, involving 968 older men and post-menopausal women, as well as older patients who have muscle wasting because of advanced cancer. An advanced cancer population is relevant, as advanced cancer causes a loss of appetite, resulting in significant unintentional loss or wasting of both muscle and fat mass, similar to what's observed with a glucose receptor agonist treatment The totality of the clinical data from these five clinical trials demonstrates that anobisorme treatment leads to increases in muscle mass with improvements in physical function as well as significant reductions in fat mass.

Speaker Change: You know, some has been previously studied.

Speaker Change: in five clinical studies that measured muscle as an endpoint involving 968 older men and post-menopausal women, as well as older patients who have muscle wasting because of advanced cancer.

Mitchell Steiner: An advanced cancer population is relevant. An advanced cancer causes a loss of appetite, resulting in significant unintentional loss, or wasting of both muscle and fat mass, similar to what's observed with a GLP-1 receptor agonist treatment. The totality of the clinical data from these five clinical trials demonstrates that a Novosarm treatment leads to increases in muscle mass with improvements in physical function, as well as a significant reduction in fat mass. The expectation is that the novosarm in combination with glib-1 receptor agonist, with both preserved muscle and argonant fat reduction, resulting in a higher quality total weight loss.

Samuel Fisch: And an advanced cancer population is relevant, as advanced cancer causes a loss of appetite, resulting in significant unintentional loss or wasting of both muscle and fat mass, similar to what's observed with a glucose receptor agonist treatment. Furthermore, Inovasarm has a large safety database, which includes 27 clinical trials involving 1,581 men and women dosed with Inovasarm, with some patients dosed for over two years. In this large safety database, Inovasarm is generally well-tolerated without masculinizing effects in women. Reversible mild liver enzyme elevations have been reported, which are mostly grade one adverse events. There were no grade three or grade four adverse events.

Speaker Change: An advanced cancer population is relevant, as advanced cancer causes a loss of appetite, resulting in significant unintentional loss or wasting of both muscle and fat mass similar to what is observed with a group 1 receptor agonist treatment.

Speaker Change: The totality of the clinical data from these five clinical trials

Speaker Change: demonstrates that Novus Arm treatment leads to increases in muscle mass with improvements in physical function as well as significant reduction in fat mass.

Mitchell Steiner: The expectation is that anobisorme in combination with a clip-on receptor agonist would both preserve muscle and augment fat reduction, resulting in higher quality total weight loss. Furthermore, Inovasarm has a large safety database, which includes 27 clinical trials involving 1,581 men and women dosed with Inovasarm, some patients taking it for over two years. In this large safety database, Inovasarm is generally well tolerated without masculinizing effects in women. Reversible mild liver enzyme elevations have been reported, which are mostly grade 1 adverse events.

Speaker Change: The expectation is that no disarming combination with a glucose receptor agonist would both preserve muscle and augment fat reduction, resulting in a higher quality total weight loss.

Mitchell Steiner: Furthermore, a Novosarm has a large safety database, which includes 27 clinical trials, involving 1,581 men and women, dosed with an Novosarm, with some patients dosed for over two years. In this large safety database, an Novosarm is generally well tolerated without masculinizing effects in women. For reversible mild liver enzymes and elevations have been reported, which are mostly grade 1 adverse events. There were no grade 3 or grade 4 adverse events. To be clear, no drug-induced liver injury has been observed from any of the 27 clinical studies evaluating a Novosarm. Furthermore, there are no increases in gastrointestinal side effects compared to placebo.

Speaker Change: Furthermore, Inovasarm has a large safety database, which includes 27 clinical trials involving 1,581 men and women dosed with Inovasarm, with some patients dosed for over two years.

Speaker Change: In this large safety database, the NOVUSARM is generally well tolerated without masculinizing effects in women. Reversible mild liver enzyme elevations have been reported, which are mostly grade 1 adverse events. There were no grade 3 or grade 4 adverse events.

Mitchell Steiner: To be clear, no drug-induced liver injury has been observed in many of the 27 clinical studies evaluating Inovasar. Furthermore, there have been no increases in gastrointestinal side effects compared to placebo.

Speaker Change: To be clear

Speaker Change: No drug-induced liver injury has been observed from any of the 27 clinical studies evaluating Inovasar. Furthermore, there are no increases in gastrointestinal side effects compared to placebo. This is important, as there are already significant and frequent gastrointestinal side effects with a GLP1 receptor agonist treatment alone.

Mitchell Steiner: This is important, as there are already significant and frequent gastrointestinal side effects with a GLP1 receptor agonist treatment alone. Now, turning to our Inovasarm clinical program for high-quality weight loss, we're conducting the Phase IIb Quality Clinical Trials, so Quality is the name of the trial, which is a multi-centered, double-blind, placebo-controlled, randomized dose-finding study to evaluate the safety and efficacy of Inovasarm 3 mg and Inovasarm 6 mg compared to placebo in combination with Vigovi, which is semiglutinase-form receptor agonist, in approximately 150 older patients greater than the age of 60 who are overweight or obese.

Mitchell Steiner: This is important, as there is already significant frequent gastrointestinal side effects with a GLP-1 receptor agonist treatment alone.

Mitchell Steiner: The purpose of the Phase IIb clinical trial is to select the optimal dose of the NOVUS arm in combination with a glycolytic receptor agonist that best preserves muscle and augments the reduction of fat mass for better body composition at 16 weeks of treatment. The primary endpoints of the Phase 2B clinical trial will be the change in total lean body mass from baseline to 16 weeks, and key secondary endpoints will be the change from baseline to 16 weeks in total fat mass, total body weight, and physical function as measured by the serocline test.

Mitchell Steiner: Now, turning to our novosarm clinical program for high quality weight loss, we're conducting the phase 2B Quality clinical trials, the Quality is the name of the trial, which is a multi-center, double-blind placebo control, randomized dose-finding study. To evaluate the safety and efficacy of a novosarm 3 milligrams, novosarm 6 milligrams, compared to placebo, in combination with the govy, which is semaglutinase, glib-1 receptor agonist, and approximately 150 older patients, greater than the age of 60, who are overweight or be. Purvis of the Phase II B clinical trial is to select the optimal dose of a noble's arm in combination with a equipment receptor agonist that best preserves muscle and argon cancer reduction of fat mass for a better body composition at 16 weeks in treatment.

Speaker Change: Now, turning to our Inovasarm clinical program for high-quality weight loss, we're conducting the Phase IIb Quality Clinical Trial, so Quality is the name of the trial, which is a multi-centered, double-blind, placebo-controlled, randomized dose-finding study.

Speaker Change: to evaluate the safety and efficacy of inobuzolam 3 mg and inobuzolam 6 mg compared to placebo in combination with Grigovy, which is a semaglutinase-form receptor agonist, in approximately 150 older patients greater than the age of 60 who are overweight or obese.

Speaker Change: purpose of the phas to be clinical trial is to select the optimal dose of a noble arm in combination of equiipvalment ceroagonist that best preserves muscle and augents of reduction of fat mass for a better body composition and sixteen weeks treatment

Mitchell Steiner: The primary endpoints of the Phase II B clinical trial will be the change in total lean body mass from baseline to 16 weeks. And key secondary endpoints will be the change in baseline to 16 weeks in total fat mass, total body weight, and physical function is measured by the Serocline test. After completing the 16-week efficacy dose-finding portion of the Phase II B clinical trial, participants will then continue into a blinded Phase II B extension clinical trial where all patients will stop receiving equipped one receptor agonist but will continue to take in placebo, a noble's arm 3 milligrams, or a noble's arm 6 milligrams for an additional 12 weeks.

Samuel Fisch: The primary endpoints of the Phase IIb clinical trial will be the change in total lean body mass from baseline to 16 weeks, and key secondary endpoints will be the change from baseline to 16 weeks in total fat mass, total body weight, and physical function as measured by the seroclimb test. After completing the 16-week efficacy dose-finding portion of the Phase 2b clinical trial, participants will then continue into a blinded Phase 2b extension clinical trial where all patients will stop receiving a clip-1 receptor agonist but will continue taking placebo, Inovozom 3mg, or Inovozom 6mg for an additional 12 weeks.

Speaker Change: The primary endpoints of the Phase 2b clinical trial will be the change in total lean body mass from baseline to 16 weeks, and key secondary endpoints will be the change from baseline to 16 weeks in total fat mass, total body weight, and physical function as measured by the seroclimb test.

Mitchell Steiner: After completing the 16-week efficacy dose-finding portion of the Phase 2b clinical trial, participants will then continue into a blinded Phase 2b extension clinical trial, where all patients will stop receiving a clip-1 receptor agonist but will continue taking placebo Inovozom 3 mg or Inovozom 6 mg for an additional 12 weeks.

Speaker Change: After completing the 16-week efficacy dose-finding portion of the Phase 2b clinical trial, participants would then continue into a blinded Phase 2b extension clinical trial, where all patients will stop receiving a CLIP1 receptor agonist, but will continue taking placebo,

Speaker Change: Enobosar 3mg or Enobosar 6mg for an additional 12 weeks.

Mitchell Steiner: The blinded Phase II B extension clinical trial will evaluate the maintenance of weight loss, meaning whether a noble's arm can maintain muscle and prevent the fats and weight gain that occurs after discontinuing equipped one receptor agonist. We believe that assessing the effects of a noble's arm in lean body mass at fat mass at 16 weeks time point should be adequate to demonstrate significant loss of muscle in a semi-glutide and placebo cohort. Support comes from the Step 1 study reported by Wilding and all in a New England Journal of Medicine. The Step 1 study that evaluated semi-glutide for weight loss and overweight and obese patients showed that 49% of the total weight loss that's lost in that 68 weeks study.

Mitchell Steiner: The blinded phase 2b extension clinical trial will evaluate the maintenance of weight loss, meaning whether Inovozom can maintain muscle and prevent the fat and weight gain that occurs after discontinuing the glucose receptor actin. We believe that assessing the effects of Inovasorma on lean body mass and fat mass at 16 weeks' time point should be adequate to demonstrate significant loss of muscle in the semiglutide and placebo cohort. Support comes from the Step 1 study reported by Wilding et al.

Samuel Fisch: The blinded Phase 2b extension clinical trial will evaluate the maintenance of weight loss, meaning whether Inovozom can maintain muscle and prevent the fat and weight gain that occurs after discontinuing the Glupon receptor actin. A Step 1 study that evaluated semiglutide for weight loss in overweight and obese patients showed that 49% of the total weight loss that was lost in that 68-week study occurred by week 16. And for all patients who are overweight or obese, can InnovaSAR maintain adequate muscle reserve when GLP-1 receptor agonists are discontinued to prevent rebound weight gain, which is almost all fat?

Speaker Change: the blinded phase to be extension trial will evaluate the maintenance of wave launs meaning whether it nozonm can maintain muscle and prevent the fats and weight game that occurs after discontinu equiip in the ceptor agon

Speaker Change: We believe that assessing the effects of Inovasorma on lean body mass and fat mass at 16 weeks' time point should be adequate to demonstrate significant loss of muscle in a semiglutide and placebo cohort.

Mitchell Steiner: in the New England Journal of Medicine. A Step 1 study that evaluated semiglutide for weight loss in overweight and obese patients showed that 49% of the total weight loss that was lost in that 68-week study occurred by week 16. Approximately 40% of the total weight loss was attributed to muscle loss. As Inovasarm is a muscle drug that also burns fat, our current Phase IIb clinical program is designed to provide body composition clinical data to support the Phase III clinical development of Inovasarm for precision, high-quality weight loss by answering the following clinical questions related to muscle. For at-risk older adults who are overweight or obese, can an obussarm prevent loss of muscle to preserve physical function?

Speaker Change: Support comes from the Step 1 study reported by Wilding et al. in the New England Journal of Medicine.

Speaker Change: the step one study that evaluate somee ue type for weight loss and overweightin the bast patients showed that forty nine percent of the total w loss its laws in that sixty-eight weeks study occurred by week sixteen

Mitchell Steiner: This study occurred by week 16; approximately 40% of the total weight loss was attributed to muscle loss.

Speaker Change: Approximately 40% of the total weight loss was attributed to muscle loss.

Mitchell Steiner: As a noble's arm is a muscle trial that also burns fat, our current Phase II B clinical program is designed to provide body composition clinical data to support the Phase III clinical development of a noble's arm for precision high-quality weight loss by answering the following clinical questions related to muscle. For at risk, older adults who are overweight or obese can and oversarm prevent loss of muscle to preserve physical function. For all patients who are overweight or obese, can an oversarm preserve muscle to prevent equipped one receptor agonist weight loss plateau. For all patients who are overweight or obese, can an oversarm maintain adequate muscle reserve when equipped one receptor agonist will discontinue to prevent the rebound weight gain, which is almost all fat.

Speaker Change: As Inovasarm is a muscle drug that also burns fat, our current Phase IIb clinical program is designed to provide body composition clinical data to support the Phase III clinical development of Inovasarm for precision high-quality weight loss by answering the following clinical questions related to muscle.

Speaker Change: For at risk older adults who are overweight or obese, can InnovaSARM prevent loss of muscle to preserve physical function?

Mitchell Steiner: For all patients, for all patients who are overweight or obese, can a nose arm preserve muscle to prevent the GLP-1 receptor agonist weight loss plateau? And for all patients who are overweight or obese, can InnovaSAR maintain adequate muscle reserve when GLP-1 receptor agonists are discontinued to prevent the rebound weight gain, which is almost all fat? I'm proud of our team as they have expeditiously executed the Inovasorm Phase IIb quality clinical program.

Speaker Change: For all patients, for all patients who are overweight or obese, can a nose arm preserve muscle to prevent the GLP-1 receptor agonist weight loss plateau.

Speaker Change: And for all patients who are overweight or obese, can InnovaSAR maintain adequate muscle reserve when GLP-1 receptor agonists are discontinued to prevent the rebound weight gain, which is almost all fat.

Mitchell Steiner: I'm proud of our team as they have expeditiously executed the a noble's arm Phase II B quality clinical program. We prioritized the company's clinical development activities to address this new important I met need in November of 2023. We filed the I&D with the FDA in January of 2024. We received FDA clearance on the I&D in February of 2024. We made a strategic decision to upsize the size of the trial to 150 patients and increase the power of the study. We initiated this Phase II B clinical quality study in April of 2024. Clinical studies being conducted in 14 clinical sites in the United States.

Speaker Change: I'm proud of our team as they have expeditiously executed the Inovasorm Phase IIb Quality Clinical Program.

Mitchell Steiner: Prioritizing the company's clinical development activities to address this new important unmet need, we filed the IND with the FDA in January of 2024. We received FDA clearance on the IND in February of 2024. We made a strategic decision to upsize the size of the trial to 150 patients to increase the power of the study. We initiated this Phase IIb clinical quality study in April of 2024, and clinical studies are being conducted in 14 clinical sites in the United States.

Speaker Change: We prioritized the company's clinical development activities to address this new important unmet need in November of 2023. We filed the IND with the FDA in January of 2024.

Speaker Change: We received FDA clearance on the IND in February of 2024.

Speaker Change: We made a strategic decision to upsize the size of the trial to 150 patients to increase the power of the study.

Operator: Good morning ladies and gentlemen and welcome to Veru Inc's Investors Conference call. All participants will be in the Sonali mode. Should you need assistance, please know a conference specialist repressing the star key, followed by zero.

Speaker Change: We initiated this Phase IIb quality study in April of 2024. Clinical study is being conducted in 14 clinical sites in the United States. This morning,

Samuel Fisch: Clinical studies are being conducted in 14 clinical sites in the United States, with results expected in January 2025. Furthermore, the top-line results of the separate blinded Phase IIb extension clinical study may now be expected in the second calendar quarter of 2025. We believe we have sufficient financial resources on hand for cash of $29.2 million at the end of June 2024 to complete and provide results for both the Phase IIb quality clinical trial and the Phase IIb extension clinical trial. I will now turn the call over to Michele Greco, CFO, and CAO, to discuss the financial highlights. Michele?

Mitchell Steiner: This morning, this morning I'm pleased to report that we have completed the greater than 150 patient enrollment for the Phase II B quality study. can now anticipate that the last patient to complete the Phase 2B Quality Study will be in December of 2024, with top line clinical results of the Phase 2B Clinical Study expected in January of 2025. Furthermore, the top line results of the separate blinded Phase 2B extension clinical study may now be expected in the second calendar quarter of 2025. We believe we have sufficient financial resources on hand; we cash at $29.2 million at the end of June 2024 to complete and provide results on both the Phase 2B Quality Clinical Trial and the Phase 2B Extension Clinical Trial.

Mitchell Steiner: This morning, I'm pleased to report that we have completed greater than 150 patient enrollment for the Phase IIb quality study. We can now anticipate that the last patient to complete the Phase IIb quality study will be in December of 2024, with top-line clinical results for the Phase IIb clinical study expected in January 2025. Furthermore, the top-line results of the separate blinded phase 2b extension clinical study may now be expected in the second calendar quarter of 2025.

Operator: After this morning's discussion, there will be an opportunity to ask questions. Please note, this event is being recorded.

Speaker Change: This morning, I'm pleased to report that we have completed the greater than 150 patient enrollment for the Phase IIb quality study.

Sam Fish: But now it's time to conference over to Mr. Sam Fish, Veru Inc's executive director, investor relations and corporate communications. Please go ahead.

Speaker Change: We can now anticipate that the last patient to complete the Phase IIb quality study will be in December of 2024, with top-line clinical results for the Phase IIb clinical.

Sam Fish: Good morning. The statements made on this conference call may be forward-looking statements. Forward-looking statements may include, but they're not necessarily limited to, statements of the company's plans, objectives, expectations or intentions regarding its business, operations, regulatory interactions, finances and development and product portfolio. Such forward-looking statements are subject to known and unknown risks and uncertainties and are actual results made different significantly from those projected, suggested or included in any forward-looking statements. Writs that may cause actual results or developments that differ materially are contained in our 10Q and 10K SEC filings as well as in our press releases from time to time.

Speaker Change: study expected in January 2025. Furthermore, the top-line results of the separate blinded Phase IIb extension clinical study may now be expected in second quarter, second calendar quarter of 2025.

Mitchell Steiner: We believe we have sufficient financial resources on hand for cash of $29.2 million at the end of June 2024 to complete and provide results in both the Phase IIb quality clinical trial and the Phase IIb extension clinical trial. I will now turn the call over to Michele Greco, CFO, and CAO, to discuss the financial highlights.

Speaker Change: We believe we have sufficient financial resources on hand for cash of $29.2 million at the end of June 2024 to complete and provide results in both the Phase IIb Quality Clinical Trial and the Phase IIb Extension Clinical Trial.

Michele Greco: I will now turn the call over to Michele Greco, CFO, CEO, to discuss the financial highlights. Michele. Thank you, Dr. Steiner. Let's start our highlights with the third quarter results for the three months ended June 30, 2024. Overall, net revenues were $4 million compared to $3.3 million in the prior year's third quarter. The company's quarterly sales for its U.S. Prescription business were $552,000 compared to $863,000 in the prior year's third quarter. Net revenue from the global public sector business for the quarter was $3.4 million compared to $2.5 million in the prior year's quarter. The increase in the public sector business is for increased shipments under our contracts with UNFPA and USAID.

Michele Greco: The increase in the public sector business is due to increased shipments under our contracts with UNFPA and USAID. Gross profit increased due to an increase in units sold. The decrease in gross margin is due to a change in sales mix with the U.S. prescription business, which has a higher profit margin and comprises a smaller percentage of total net revenue. Operating expenses for the quarter decreased to $12.4 million compared to the prior year's quarter of $19.7 million.

michelle grecco: i will now turn the call over to michelle grecco cfoo to discuss the financial highlights michelle

Mitchell Steiner: I would now like to turn the conference call over to Dr. Mitchell Steiner, Veru Inc's chairman, CEO and president.

Michele Greco: Thank you, Dr. Steiner. Let's start our highlights with the third quarter results for the three months ended June 30, 2024. Overall, net revenues were $4 million compared to $3.3 million in the prior year's third quarter. The company's quarterly sales for its U.S. prescription business were $552,000 compared to $863,000 in the prior year's third quarter. Net revenue from the global public sector business for the quarter was 3.4 million dollars compared to 2.5 million dollars in the prior year's quarter. The increase in the public sector business is due to increased shipments under our contracts with UNFPA and USAID.

michelle grecco: Thank you, Dr. Steiner. Let's start our highlights with the third quarter results for the three-month-ended June 30, 2024. Overall, net revenues were $4 million compared to $3.3 million in the prior year's third quarter.

Mitchell Steiner: Good morning. With me on this morning's call, Dr. Gary Barnett, Chief Scientific Officer, Michelle Greco, Chief Financial Officer and Chief Administrative Officer, Michael Purface, the General Counsel and Executive Vice President of Corporate Strategy, and Sam Fish, Executive Director of Investive Relations and Corporate Communications. Thank you for joining our Q3 fiscal year 2024 earnings call.

michelle grecco: The company's quarterly sales for its U.S. prescription business were $552,000 compared to $863,000 in the prior year's third quarter.

michelle grecco: Net revenue from the global public sector business for the quarter was $3.4 million compared to $2.5 million in the prior year's quarter.

Mitchell Steiner: Veru is a late clinical stage biopharmaceutical company focused on developing innovative medicines for high quality weight loss, oncology and acute respiratory distress syndrome. Company's drug development pipeline includes two late-stage and novel oral small molecules and novosarm and submissive urine. In our weight loss pipeline, we have a novosarm, also known as Austrian MK2866 GTX-024 and Veru-024, which is an oral selective angioreceptive modulator, Sarm for short. Novosarm's being developed as a treatment and combination with a weight loss drug, like a glucogon, like peptide-1 receptor agonist, also known as a glip-1 receptor agonist, to argument fat loss and to avoid muscle loss in overweight or obese patients for chronic weight management.

Speaker Change: The increase in the public sector business is for increased shipments under our contracts with UNFPA and USAID.

Michele Greco: Overall, gross profit was $1.3 million, or 34% of net revenues, compared to $1.2 million, or 37% of net revenues, in the prior year quarter. Gross profit increased due to an increase in units sold. The decrease in gross margin is due to the change in sales mix with the U.S. prescription business which has a higher profit margin comprising a smaller percentage of total net revenues. Operating expenses for the quarter decrease to $12.4 million compared to the prior year's quarter of $19.7 million. The decrease is primarily due to research and development costs, which decrease to $4.9 million compared to $8.8 million in the prior year quarter, and the decrease in selling, general and administrative expenses of $3.4 million from $10.9 million in the prior year quarter.

Michele Greco: Overall, gross profit was $1.3 million, or 34% of net revenues compared to $1.2 million, or 37% of net revenues in the prior year quarter. Gross profit increased due to an increase in units sold. The decrease in gross margin is due to a change in sales mix with the U.S. prescription business, which has a higher profit margin and comprises a smaller percentage of total net revenue. Operating expenses for the quarter decreased to $12.4 million compared to the prior year's quarter of $19.7 million.

Speaker Change: Overall, gross profit was $1.3 million or 34% of net revenues compared to $1.2 million or 37% of net revenues in the prior year quarter.

michelle grecco: Gross profit increased due to an increase in units sold. The decrease in gross margin is due to the change in sales mix with the U.S. prescription business, which has a higher profit margin comprising a smaller percentage of total net revenues.

Speaker Change: Operating expenses for the quarter decreased to $12.4 million compared to the prior year's quarter of $19.7 million.

Michele Greco: The decrease is primarily due to research and development costs, which decreased to $4.9 million compared to $8.8 million in the prior year quarter, and a decrease in selling general and administrative expenses of $3.4 million from $10.9 million in the prior year quarter to $7.5 million in the current quarter. The decrease in research and development costs is due to our drug development strategy to focus development efforts on those drug candidates with the best opportunity for long-term success in shareholder value creation while matching available funding. During the quarter, we initiated the Phase 2B quality clinical study.

Mitchell Steiner: In our oncology pipeline and pending additional external funding or pharmaceutical partnership, we have a Novosarm in combination with a Bemicyclub as a second-line treatment, an antireceptive positive, estrogen-receptive positive, and human epidermal growth factor of two negative metastatic breast cancer. In our infectious and inflammatory disease pipeline and similarly pending additional external funding or pharmaceutical partnership, we have Subbizivulant, a microtubule disruptor, which is a planned phase three clinical trial for the treatment of hospitalized patients with viral induced ARDS.

michelle grecco: The decrease is primarily due to research and development costs, which decreased to $4.9 million compared to $8.8 million in the prior year quarter, and the decrease in selling general and administrative expenses of $3.4 million

Michele Greco: The $7.5 million in the current quarter. The decrease in research and development cost is due to our drug development strategy to focus development efforts on those drug candidates with the best opportunity for long-term success and shareholder value creation while matching available funding. During the quarter, we initiated the Phase 2B quality clinical study. The decrease in selling, general and administrative expenses is primarily due to significant costs incurred in the prior year related to preparation for the potential commercialization of submissive urine for COVID-19 prior to the FDA's declination of the company's EUA application, and an increase in personnel costs in the prior year due to increase headcount for the potential commercialization.

michelle grecco: from $10.9 million in the prior year quarter to $7.5 million in the current quarter.

Speaker Change: The decrease in research and development costs is due to our drug development strategy to focus development efforts on those drug candidates with the best opportunity for long-term success and shareholder value creation while matching available funding.

Mitchell Steiner: The company also has an FDA-proof commercial product, the FC-2 female condom and terminal condom, for dual protection against unplanned pregnancy and sexually transmitted infections. This morning, we'll provide an update on the current focus of our company, which is the development of a Novosarm, an oral psalm in combination with the gobeat, which is potentially higher-quality weight loss. We'll also provide financial highlights for our third quarter fiscal year in 2024. We'll look for receptor agonists, which include an ozemic, gobeat, stepbound, and majoro, with very effective drugs that cause significant weight loss.

Michele Greco: The decrease in selling general and administrative expenses is primarily due to significant costs incurred in the prior year related to preparation for the potential commercialization of sibizibulin for COVID-19 prior to the FDA's declination of the company's EUA application and an increase in personnel costs in the prior year due to increased headcount for the potential commercialization. These additional costs and incremental headcount have now been reduced post the EUA declination. On April 19, 2023, we sold our Intanfib product to Unkinetics for $20 million.

michelle grecco: During the quarter, we initiated the Phase IIb quality clinical study.

Speaker Change: The decrease in selling general and administrative expenses is primarily due to significant costs incurred in the prior year related to preparation for the potential commercialization of sibizibulin for COVID-19.

Speaker Change: prior to the FDA's declination of the company's EUA application and an increase in personnel costs in the prior year due to increased headcount for the potential commercialization. These additional costs and incremental headcount have now been reduced post the EUA declination.

Michele Greco: These additional costs and incremental headcount have now been reduced post the EUA declination.

Michele Greco: and April 19, 2023. We sold our entad-feed product on Kinetics for $20 million. We receive $6 million at closing and promissory notes of $14 million, which are recognized as additional gain on the sale when non-refundable consideration is received. During the current quarter, we recognize an additional gain on sale of $110,000, compared to the gain on sale of $4.7 million in the prior period. The operating loss for the quarter was $10.9 million, compared to $13.7 million in the prior quarter. Non-operating income was $132,000, compared to $1.3 million in the prior year's quarter. The reduction is primarily due to the change in the fair value of the derivative liabilities related to the FC2 synthetic royalty financing.

michelle grecco: On April 19, 2023, we sold our Intanfi product to Unkinetics for $20 million.

Michele Greco: We received $6 million at closing and promissory notes of $14 million, which are recognized as additional gain on the sale when non-refundable consideration is received. During the current quarter, we recognize an additional gain on sale of $110,000 compared to a gain on sale of $4.7 million in the prior period. The operating loss for the quarter was $10.9 million compared to $13.7 million in the prior quarter. Non-operating income was $132,000 compared to $1.3 million in the prior year's quarter. The reduction is primarily due to the change in the fair value of the derivative liabilities related to FC2 synthetic royalty financing.

Mitchell Steiner: Unfortunately, up to 50% of the total weight loss comes from muscle, which is problematic. As muscle is necessary not only for strength and physical function, but also muscle is a metabolic tissue that may play a role in allowing a higher-quality weight loss.

michelle grecco: We received $6 million at closing and promissory notes of $14 million, which are recognized as additional gain on the sale when non-refundable consideration is received.

Speaker Change: During the current quarter, we recognize an additional gain on sale of $110,000 compared to the gain on sale of $4.7 million in the prior period.

Speaker Change: The operating loss for the quarter was $10.9 million compared to $13.7 million in the prior quarter.

Speaker Change: Non-operating income was $132,000 compared to $1.3 million in the prior year's quarter. The reduction is primarily due to the change in the fair value of the derivative liabilities related to the FC2 synthetic royalty financing.

Michele Greco: For the quarter, rerecorded a tax expense of $162,000, compared to $58,000 in the prior year's quarter. The bottom line result for the third quarter was a net loss of $11 million, or $0.7 per diluted common share, compared to a net loss of $12.5 million, or $14 per diluted common share in the prior year's quarter.

Michele Greco: For the quarter, we recorded a tax expense of $162,000 compared to $58,000 in the prior year's quarter. The bottom line result for the third quarter was a net loss of $11 million, or $0.07 per diluted common share, compared to a net loss of $12.5 million, or $0.14 per diluted common share, in the prior year's quarter. During the third quarter, we used cash of $5.6 million for operating activities. Now, we turn to the results for the nine months ended June 30, 2024.

Mitchell Steiner: Up to 34% of obese patients over the age of 60 have sarcopenic obesity. Sarcopenic being the age-related loss of muscle. This large subpopulation of sarcopenic obese patients is especially at risk when taking a Glypholim receptor drug for weight loss as they may already have critically low amounts of muscle due to age-related muscle loss. Because of the magnitude and speed of muscle loss, while on a Glypholim receptor agonist therapy for weight loss, Glypholim receptor agonist drugs may accelerate the development of frailty and muscle weakness in obese and overweight elderly patients.

Speaker Change: For the quarter, we recorded a tax expense of $162,000 compared to $58,000 in the prior year's quarter.

Speaker Change: The bottom line result for the third quarter was a net loss of $11 million, or $0.07 per diluted common share, compared to a net loss of $12.5 million, or $0.14 per diluted common share in the prior year's quarter.

Michele Greco: During the third quarter, we use cash of $5.6 million for operating activities. Now turning to the results for the nine months ended June 30th, 2024. For the first nine months of fiscal 2024, total net revenues were $10.2 million, compared to $12.4 million in the prior year period. Net revenues from the U.S. Prescription business were $1.8 million, compared to $5.2 million in the prior year period. Included in the net revenues for the prior period were $3.9 million for sales to the Pill Club. The reduction of prescription business net revenues is due to not having any revenues from the Pill Club in the current period due to the fact the Pill Club's Chapter 11 bankruptcy filing in the prior year.

Speaker Change: During the third quarter, we used cash of $5.6 million for operating activities.

Michele Greco: For the first nine months of fiscal 2024, total net revenues were $10.2 million compared to $12.4 million in the prior year period. The decrease in gross profit and gross margin is due to a change in the sales mix with the U.S. prescription business, which has a higher profit margin comprising a smaller percentage of total net revenues and an increase in our cost of sales due to a charge of $1.2 million for an obsolete stock reserve related to inventory in the U.S. prescription channel.

Speaker Change: Now turning to the results for the nine months ended June 30th, 2024. For the first nine months of fiscal 2024, total net revenues were $10.2 million compared to $12.4 million in the prior year period.

Michele Greco: For the first nine months of fiscal 2024, total net revenues were $10.2 million compared to $12.4 million in the prior year period. Net revenues from the U.S. prescription business were $1.8 million compared to $5.2 million in the prior year period. Included in the net revenues for the prior period were $3.9 million for sales to the Pill Club. The reduction in prescription business net revenues is due to not having any revenues from the Pill Club in the current period due to the fact that Pill Club filed a Chapter 11 bankruptcy filing in the prior year. Net revenues from the global public sector business for the period were $8.4 million, compared to $7.2 million in the prior year's period.

Mitchell Steiner: Muscle weakness may lead to poor balance, decreased skate speed, mobility disability, loss of independence, and high risk with falls and fractures. In fact, the safety section of the package insert for regover has been updated based on the recently reported select cardiovascular outcome clinical trial, which now highlights a 400% increase in pelvic and hip fractures that were observed in patients greater than the age of 75 years receiving regover compared to placebo patients, and that was 2.4% versus 0.6%.

Speaker Change: Net revenues from the U.S. prescription business were $1.8 million, compared to $5.2 million in the prior year period.

Speaker Change: included in the net revenues for the prior period were 3.9 million dollars.

Speaker Change: for sales to the Pill Club. The reduction of prescription business net revenues is due to not having any revenues from the Pill Club in the current period due to the fact the Pill Club's Chapter 11 bankruptcy filing in the prior year.

Mitchell Steiner: Practures of the hip and pelvis typically occur because of falls which increase with decreased muscle mass. Second, for all patients who are overweight or obese, muscle preservation may prevent a Glypholim receptor with agonist weight loss plateau. Significant depletion of muscle mass may also be one of the reasons why patients with Glypholim receptor agonist drugs reach a weight loss plateau, meaning the rate of weight loss slows or stops while taking it with one receptor agonist drug.

Michele Greco: Net revenues from the global public sector business for the period were $8.4 million, compared to $7.2 million in the prior year's period. Overall, gross profit was $3.2 million, or 31% of net revenues, compared to $6 million, or 48% of net revenues in the prior year period. The decrease in gross profit in gross margin is due to the change in the sales mix with the U.S. prescription business which has a higher profit margin, comprising a smaller percentage of total net revenues and an increase in our cost of sales due to a charge of $1.2 million for an obsolete stack reserve related to inventory in the U.S.

Speaker Change: Net revenues from the global public sector business for the period were $8.4 million compared to $7.2 million in the prior year's period.

Michele Greco: Overall, gross profit was $3.2 million, or 31% of net revenues, compared to $6 million, or 48% of net revenues in the prior year period. The decrease in gross profit and gross margin is due to a change in the sales mix with the U.S. prescription business, which has a higher profit margin comprising a smaller percentage of total net revenues and an increase in our cost of sales due to a charge of $1.2 million for an obsolete stock reserve related to inventory in the U.S. prescription channel.

Speaker Change: Overall, gross profit was $3.2 million, or 31% of net revenues, compared to $6 million, or 48% of net revenues in the prior year period.

Speaker Change: The decrease in gross profit in gross margin is due to the change in the sales mix with the U.S. prescription business, which has a higher profit margin comprising a smaller percentage of total net revenues.

Mitchell Steiner: The hypothesis is that loss of muscle creates a muscle deficit that causes low energy balance and triggers in the brain's signal to increase appetite that counters the inhibition of appetite. Glypholim receptor agonist drugs thus leading to the weight loss plateau. Without a muscle deficit, Glypholim drugs may maintain the loss of appetite and reduction of calorie consumption which may potentially remove more fat mass with greater weight loss. Third, for all patients who are overweight or obese, muscle depletion may trigger the overeating that occurs in the patient discontinues a Glypholim receptor agonist resulting in a rebound weight gain.

Speaker Change: and an increase in our cost of sales due to a charge of $1.2 million for an obsolete stock reserve related to inventory in the U.S. Prescription Channel.

Michele Greco: prescription channel. Operating expenses decreased by $63.4 million to $32.9 million, compared to the prior year of $96.4 million. The decrease is driven by a reduction in research and development costs of $37.7 million to $9.5 million from $47.3 million in the prior year. And a reduction in selling, general and administrative expenses of $17.9 million from $41.3 million in the prior year to $23.4 million. The factors contributing to the decrease in research and development costs and selling, general and administrative expenses are the same as those described for the quarter. During the prior year, we also recorded an impairment charge of $3.9 million related to in-process research and development costs and a provision for credit losses of $3.9 million related to the receivables from the Pill Club.

Michele Greco: Operating expenses decreased by $63.4 million to $32.9 million compared to the prior year of $96.4 million. The decrease is driven by a reduction in research and development costs of $37.7 million to $9.5 million from $47.3 million in the prior year, and a reduction in selling general and administrative expenses of $17.9 million from $41.3 million in the prior year to $23.4 million. The factors contributing to the decrease in research and development costs and selling general and administrative expenses are the same as those described for the quarter.

Speaker Change: Operating expenses decreased by 63.4 million dollars to 32.9 million dollars compared to the prior year of 96.4 million dollars.

Mitchell Steiner: That is, they regain their original weight, but now they regain weight as composed almost all of fat. Having a drug that maintains adequate muscle reserve when a Glypholim receptor drug is discontinued may prevent this rebound weight gain and help with the maintenance of weight loss.

Speaker Change: The decrease is driven by a reduction in research and development costs of $37.7 million.

Speaker Change: to $9.5 million from $47.3 million in the prior year.

Speaker Change: and a reduction in selling general and administrative expenses of $17.9 million from $41.3 million in the prior year to $23.4 million.

Speaker Change: The factors contributing to the decrease in research and development costs and selling general and administrative expenses are the same as those described for the quarter.

Mitchell Steiner: We believe that a novice arm or a novel oral selective energy receptor modulator may be the best drug candidate to address this urgent unmet medical need to preserve muscle and patients receiving a Glypholim receptor agonist for weight loss. Thomas. Data from our clinical trials and pre-clinical studies support a novosarmic potential. Novosarm is given as a once-a-day oral dose, and novosarm works through the engine receptor, and well-established mechanism. Novosarm demonstrates tissue-selectivity as it improves and preserves the lean body mass, muscle mass, and physical function.

Michele Greco: During the prior year, we also recorded an impairment charge of $3.9 million related to in-process research and development costs and a provision for credit losses of $3.9 million related to receivables from the Pill Club. For the nine months, we recorded a gain on the sale of Entafi of $1 million compared to $4.7 million in the prior period. Operating loss for the period was $28.7 million compared to $85.6 million in the prior year, a decrease of $56.9 million, which is primarily due to the reduction in operating expenses.

Speaker Change: During the prior year, we also recorded an impairment charge of $3.9 million related to in-process research and development costs and a provision for credit losses of $3.9 million related to the receivables from the Pill Club.

Michele Greco: During the nine months, we recorded again on the sale of a taffy of $1 million compared to $4.7 million in the prior period. Operating loss for the period was $28.7 million compared to $85.6 million in the prior year, a decrease of $56.9 million, which is primarily due to the reduction in operating expenses. Non-operating expenses were $289,000 compared to operating income of $508,000. For the nine months, we recorded a tax expense of $272,000 compared to a tax benefit of $77,000 in the prior year. The bottom line result for the first nine months of fiscal 2024 was a net loss of $29.3 million, or $0.22 cents per diluted common share, compared to a net loss of $85 million, or $1.20 cents per diluted common share in the prior year.

Speaker Change: during the nine months we recorded againain on the sale of ty of one million dollars compared to four point seven million dollars in the prior period

Speaker Change: Operating loss for the period was $28.7 million compared to $85.6 million in the prior year, a decrease of $56.9 million, which is primarily due to the reduction in operating expenses.

Mitchell Steiner: In addition, novosarm also directly causes a breakdown of fat, and prevents storage of fat, resulting in a decrease in fat mass. This represents a different non-overlapping mechanism of the drug action to reduce fat, as distinct from the glib-1 receptor agonist, which suppresses acid and which suppresses appetite, resulting in a low caloric state. Therefore, if a novosarm is given with the glib-1 receptor agonist, the combination utilizes two different mechanisms to increase the loss of fat.

Michele Greco: Non-operating expenses were $289,000 compared to operating income of $508,000. For the nine months, we recorded a tax expense of $272,000 compared to a tax benefit of $77,000 in the prior year. The bottom line result for the first nine months of fiscal 2024 was a net loss of $29.3 million, or 22 cents per diluted common share, compared to a net loss of $85 million, or 1.2 cents per diluted common share, in the prior year. The net loss for the company decreased by $55.7 million for the nine-month period.

Speaker Change: Non-operating expenses were $289,000 compared to operating income of $508,000.

Speaker Change: For the nine months, we recorded a tax expense of $272,000 compared to a tax benefit of $77,000 in the prior year.

Speaker Change: The bottom line result for the first nine months of fiscal 2024 was a net loss of $29.3 million, or $0.22 per diluted common share, compared to a net loss of $85 million, or $0.12 per diluted common share in the prior year.

Mitchell Steiner: Also, an novosarm builds and heals bone, providing another potential benefit to treat bone loss, which is also known as osteoporosis to prevent fractures. Novosarm has been previously studied, and five clinical studies that measured muscle as an end point, involving 968 older men and postmenopausal women, as well as older patients who have muscle wasting because of advanced cancer. An advanced cancer population is relevant. An advanced cancer causes a loss of appetite, resulting in significant unintentional loss, or wasting of both muscle and fat mass, similar to what's observed with a glib-1 receptor agonist treatment.

Michele Greco: The net loss for the company decreased by $55.7 million for the nine-month period. The main reason for the decrease in the net loss relates to the company's focus on drug candidates with the best opportunity for long-term success and shareholder value creation while matching available funding and elimination of the commercial team in related commercialization expenses for the potential loss launch of the discipline for COVID-19. Looking at the balance sheet, as of June 30, 2024, our cash balance was $29.2 million and accounts receivable were $1.6 million compared to a cash balance of $9.6 million and accounts receivable balance of $4.5 million as of September 30, 2023.

Speaker Change: The net loss for the company decreased by $55.7 million for the nine-month period.

Michele Greco: The main reason for the decrease in the net loss relates to the company's focus on drug candidates with the best opportunity for long-term success in shareholder value creation while matching available funding and eliminating the commercial team and related commercialization expenses for the potential launch of Sodasibuline for COVID-19. We generated cash from financing activities for the nine months ended June 30, 2024 of $36.8 million compared to $9 million in the prior period.

Michele Greco: The main reason for the decrease in the net loss relates to the company's focus on drug candidates with the best opportunity for long-term success in shareholder value creation while matching available funding and eliminating the commercial team and related commercialization expenses for the potential launch of Sibizabulin for COVID-19. Now looking at the balance sheet, as of June 30, 2024, our cash balance was $29.2 million, and accounts receivable were $1.6 million, compared to a cash balance of $9.6 million and an accounts receivable balance of $4.5 million as of September 30, 2023.

Speaker Change: The main reason for the decrease in the net loss relates to the company's focus on drug candidates with the best opportunity for long-term success and shareholder value creation while matching available funding.

Speaker Change: and Elimination of the Commercial Team and Related Commercialization Expenses for the Potential Launch of Sodasibuline for COVID-19.

Michele Greco: Our net working capital was $27.9 million on June 30, 2024, compared to $5.1 million on September 30, 2023. During the nine months ended June 30, 2024, we used cash of $17.3 million for operating activities, compared with $78.5 million used for operating activities in the prior period. We generated cash from financing activities for the nine months ended June 30, 2024 of $36.8 million compared to $9 million in the prior period. On December 18, 2023, we completed an underwritten public offering of our common stock, which included the exercise in full of the underwriter's option to purchase additional shares.

Mitchell Steiner: The totality of the clinical data from these five clinical trials demonstrates that a novosarm treatment leads to increases in muscle mass with improvements in physical function, as well as significant reduction in fat mass. The expectation is that the novosarm in combination with glib-1 receptor agonist, with both preserved muscle and argonant fat reduction, resulting in a higher quality total weight loss. Furthermore, a novosarm has a large safety database, which includes 27 clinical trials, involving 1,581 men and women, dosed with an novosarm, with some patients dosed for over two years.

Speaker Change: Now looking at the balance sheet. As of June 30, 2024, our cash balance was $29.2 million and accounts receivable were $1.6 million.

Speaker Change: compared to a cash balance of $9.6 million and accounts receivable balance of $4.5 million as of September 30, 2023.

Michele Greco: Our net working capital was $27.9 million on June 30, 2024, compared to $5.1 million on September 30, 2023. During the nine-month ended June 30, 2024, we used cash at $17.3 million for operating activities compared with $78.5 million used for operating activities in the prior period. We generated cash from financing activities for the nine-month ended June 30, 2024, of $36.8 million compared to $9 million in the prior period. On December 18, 2023, we completed an underwritten public offering of our common stock, which included the exercise in full of the underwriter's option to purchase additional shares. Net proceeds to the company from this offering were approximately $35.2 million after deducting underwriting discounts and commissions and costs incurred by the company.

Speaker Change: Our net working capital was $27.9 million on June 30, 2024, compared to $5.1 million on September 30, 2023.

Speaker Change: During the nine months ended June 30, 2024, we used cash of $17.3 million for operating activities, compared with $78.5 million used for operating activities in the prior period.

Mitchell Steiner: In this large safety database, an novosarm is generally well tolerated without masculinizing effects in women. For reversible mild liver enzymes and elevations have been reported, which are mostly grade 1 adverse events, there were no grade 3 or grade 4 adverse events. To be clear, no drug induced liver injury has been observed from any of the 27 clinical studies evaluating a novosarm. Furthermore, there are no increases in gastrointestinal side effects compared to placebo. This is important, as there is already significant frequent gastrointestinal side effects with a glib-1 receptor agonist treatment alone.

Speaker Change: We generated cash from financing activities for the nine month ended June 30, 2024 of $36.8 million compared to $9 million in the prior period.

Speaker Change: On December 18, 2023, we completed an underwritten public offering of our common stock, which included the exercise in full of the underwriter's option to purchase additional shares.

Michele Greco: Net proceeds to the company from this offering were approximately $35.2 million after deducting underwriting discounts and commissions and costs incurred by the company. All the shares sold were offered by the company. We're working to increase future FC2 net revenues in the U.S. prescription channel by growing awareness and driving demand for FC2 through increased marketing efforts for our own telehealth platform. We're also starting to see increases in our global public sector business from efforts to increase FC2 market awareness in developing countries.

Speaker Change: Net proceeds to the company from this offering were approximately $35.2 million after deducting underwriting discounts and commissions and costs incurred by the company.

Michele Greco: All this share sold were offered by the company.

Mitchell Steiner: We are working to increase the future FT2 net revenues in the U.S. Prescription Channel by growing awareness and driving demand of FT2 through increased marketing efforts for our own telehealth platform. We are starting to see increases in our global public sector business from efforts to increase FT2 market awareness in developing countries. Dr. Stiner, Dr. Stiner.

Mitchell Steiner: Now, turning to our novosarm clinical program for high quality weight loss, we're conducting the phase 2B quality clinical trials, the quality is the name of the trial, which is a multi-center, double-blind placebo control, randomized dose-finding study. To evaluate the safety and efficacy of a novosarm 3 milligrams, novosarm 6 milligrams, compared to placebo, in combination with the govy, which is semaglutinase, glib-1 receptor agonist, and approximately 150 older patients, greater than the age of 60, who are overweight or be.

Speaker Change: All the shares sold were offered by the company.

Speaker Change: We're working to increase the future FC2 net revenues in the U.S. Prescription Channel by growing awareness and

Speaker Change: in driving demand of FC3 through increased marketing efforts.

Speaker Change: for our own telehealth platform.

Speaker Change: We're starting to see increases in our global public sector business from efforts to increase FC2 market awareness in developing countries.

Mitchell Steiner: Thank you, Michele. All of the GLP-1 receptor agonists work mainly by creating a low-caloric starvation state by reducing appetite. The results in the non-selective loss of both muscle and fat tissues to cause weight loss. Using a muscle-reserving drug can also decrease fat mass like a nobo-zarm, and combination of group-1 receptor agonists may allow for the enhanced reduction of fat mass for high quality, higher quality, precision weight loss, and not only older patients who are overweight or obese, but also for all patients who are overweight or obese.

Speaker Change: Now I'd like to turn the call back to Dr. Steiner. Dr. Steiner?

Mitchell Steiner: All of the GLP-1 receptor agonists work mainly by creating a low-caloric starvation state by reducing appetite that results in a non-selective loss of both muscle and fat tissues that cause weight loss. Using a muscle-preserving drug that can also decrease fat mass, like Inobizar, in combination with a GLP-1 receptor agonist may allow for an enhanced reduction of fat mass for higher-quality precision weight loss in not only older patients who are overweight or obese but also for all patients who are overweight or obese. This is truly an unmet medical need.

Dr. Steiner: Thank you, Michele.

Dr. Steiner: All of the GLP-1 receptor agonists work mainly by creating a low caloric starvation state by reducing appetite that results in the non-selective loss of both muscle and fat tissues that cause weight loss.

Mitchell Steiner: Purvis of the Phase II B clinical trial is to select the optimal dose of a noble's arm in combination with a equipment receptor agonist that best preserves muscle and argon cancer reduction of fat mass for a better body composition at 16 weeks in treatment.

Speaker Change: Using a muscle-preserving drug that can also decrease fat mass, like inobuzorin,

Speaker Change: in combination with a glucose receptor agonist may allow for the enhanced reduction of fat mass for higher quality precision weight loss in not only older patients who are overweight or obese, but also for all patients who are overweight or obese. This is truly an unmet medical need.

Mitchell Steiner: The primary endpoints of the Phase II B clinical trial will be the change in total lean body mass from baseline to 16 weeks. And key secondary endpoints will be the change in baseline to 16 weeks in total fat mass, total body weight, and physical function is measured by the Serocline test. After completing the 16 week efficacy dose finding portion of the Phase II B clinical trial, participants will then continue into a blinded Phase II B extension clinical trial where all patients will stop receiving equipped one receptor agonist but will continue to take in placebo, a noble's arm 3 milligrams or a noble's arm 6 milligrams for an additional 12 weeks.

Mitchell Steiner: This is truly an unmet medical need. We believe that a nobo-zarm is the best investigational drug candidate to address the muscle loss caused by GLP-1 receptor agonist drugs for weight loss. Nobo-zarm is a first-in-class arm. It has a once-a-day-world dosing, it has demonstrated tissue selectivity, utilized a well-known mechanism of action, the antireceptor to favorably change body composition. Activation of the antireceptor increases muscle mass, improves physical function, and decreases fat mass to potentially achieve a high-quality weight loss. Nobo-zarm has a favorable safety profile and would not add to the gastrointestinal side effects that are already observed with a GLP-1 receptor agonist treatment alone.

Mitchell Steiner: We believe that Inovasarm is the best investigational drug candidate to address the muscle loss caused by glyphon receptor agonist drugs for weight loss. NovoSARM is a first-in-class SARM, has once-a-day oral dosing, has demonstrated tissue selectivity, and utilizes a well-known mechanism of action, the androgen receptor, to favorably change body composition. Activation of the androgen receptor increases muscle mass, improves physical function, and decreases fat mass to potentially achieve a higher quality of weight loss.

Speaker Change: We believe that Inovasarm is the best investigational drug candidate to address the muscle loss caused by GLP1 receptor agonist drugs for weight loss.

Samuel Fisch: NovoSARM is a first-in-class SARM, has a once-a-day oral dose, has demonstrated tissue selectivity, and utilizes a well-known mechanism of action, the angina receptor, to favorably change body composition. Activation of the angina receptor increases muscle mass, improves physical function, and decreases fat mass to potentially achieve a higher quality of weight loss.

Dr. Steiner: NovoSARM is a first-in-class SARM, has a once-a-day oral dosing, has demonstrated tissue selectivity, utilizes a well-known mechanism of action, the angioreceptor, to favorably change body composition.

Speaker Change: Activation of the androgen receptor increases muscle mass, improves physical function, and decreases fat mass to potentially achieve a higher quality of weight loss.

Samuel Fisch: NovoSARM has a favorable safety profile and would not add to the gastrointestinal side effects that are already observed with a GLP1 receptor agonist treatment alone. The global obesity and overweight drug market is projected by many research analysts to be $100 billion annually by 2030. I should note that we also have new clinical data that we generated from re-examination of the clinical data from some of the previous five clinical muscle studies evaluating NovoSARM that further support the potential of NovoSARM for the preservation of total lean body mass and the reduction of fat mass to improve body composition for higher quality weight loss in patients who are obese or overweight.

Mitchell Steiner: NovoSARM has a favorable safety profile and would not add to the gastrointestinal side effects that are already observed with GLP1 receptor agonist treatment alone. The global obesity and overweight drug market is projected by many research analysts to be $100 billion annually by 2030. The combination of the novus arm with a glucoform receptor agonist potentially represents a multi-billion dollar opportunity. I should note that we also have new clinical data that we generated from re-examination of the clinical data from some of the previous five clinical muscle studies evaluating NovoSARM that further support the potential of NovoSARM for the preservation of total lean body mass and the reduction of fat mass to improve body composition for higher quality weight loss in patients who are obese or overweight.

Speaker Change: NOVASARM has a favorable safety profile and would not add to the gastrointestinal side effects that are already observed with a Glucoma Receptor Agonist treatment alone.

Mitchell Steiner: The global obesity and overweight drug market is projected by many research analysts to be $100 billion annually by 2030. The combination of a nobo-zarm with a GLP-1 receptor agonist potentially represents a multi-billion-dollar opportunity. I should note that we also have new clinical data that we generated from re-examination of the clinical data from some of the previous five clinical muscle studies evaluating a nobo-zarm that further supports the potential of a nobo-zarm for the preservation of the total lean body mass and the reduction of fat mass to improve body composition for a higher-quality weight loss in patients who will be so overweight.

Dr. Steiner: The global obesity and overweight drug market is projected by many research analysts to be $100 billion annually by 2030.

Dr. Steiner: The combination of the ANOVUS arm with a glucoform receptor agonist potentially represents a multi-billion dollar opportunity.

Mitchell Steiner: Support comes from the Step 1 study reported by wilding and all in a new England Journal of Medicine. The Step 1 study that evaluated semi-glutide for weight loss and overweight and obese patients showed that 49% of the total weight loss that's lost in that 68 weeks study. This study occurred by week 16, approximately 40% of the total weight loss was attributed to muscle loss. As a noble's arm is a muscle trial that also burns fat, our current Phase II B clinical program is designed to provide body composition clinical data to support the Phase III clinical development of a noble's arm for precision high-quality weight loss by answering the following clinical questions related to muscle.

Speaker Change: I should note that we also have new clinical data that we generated from re-examination of the clinical data from some of the previous five clinical muscle studies evaluating NovoSARM.

Speaker Change: that further support the potential of an ovazorm for the preservation of total lean body mass and the reduction of fat mass to improve body composition for higher quality weight loss in patients who are obese or overweight.

Mitchell Steiner: The company will be presenting an abstract of the obesity of week 2024, and that's in November 2nd through the 6th and San Antonio, Texas. Furthermore, we've been invited to present keynote lectures at the 4th edition of the World Obesity and Weight Management Congress, being held October 24th to 26th in Baltimore, Maryland. In the 17th International Conference of the Society of Sarcopenia, Kekexia and Wasting Disorders, being held December 6th to the 8th in Washington, DC. I've also been invited to co-chair a session entitled "Body Composition Changes Induced by GLP-1 Receptor Agonist and Obesity Therapy" at the International Conference of the Society of Sarcopenia, Kekexia and Wasting Disorders.

Samuel Fisch: The company will be presenting an abstract at Obesity Week 2024, and that's November 2nd through the 6th in San Antonio, Texas. Furthermore, we have been invited to present keynote lectures at the fourth edition of the World Obesity and Weight Management Congress, being held October 24th through 26th in Baltimore, Maryland, and the 17th International Conference of the Society of Sarcopenia, Cachexia, and Wasting Disorders, being held December 6th through the 8th in Washington, D.C. We are very excited by the prospects of Inovasarm to address this new and important medical need. We are looking forward to the top-line results of this important and timely Phase IIb quality clinical study.

Mitchell Steiner: The company will be presenting an abstract at Obesity Week 2024, and that's November 2nd through the 6th in San Antonio, Texas. Furthermore, we've been invited to present keynote lectures at the fourth edition of the World Obesity and Weight Management Congress, being held October 24th through 26th in Baltimore, Maryland, and the 17th International Conference of the Society of Sarcopenia, Cachexia, and Wasting Disorders, being held December 6th through the 8th in Washington, D.C.

Speaker Change: The company will be presenting an abstract of the Obesity Week 2024, and that's in November 2nd through the 6th in San Antonio, Texas.

Speaker Change: Furthermore, we've been invited to present keynote lectures at the fourth edition of the World Obesity and Weight Management Congress being held October 24th to 26th in Baltimore, Maryland.

Mitchell Steiner: For at risk, older adults who are overweight or obese can and oversarm prevent loss of muscle to preserve physical function. For all patients who are overweight or obese can and oversarm preserve muscle to prevent equipped one receptor agonist weight loss plateau. For all patients who are overweight or obese can and oversarm maintain adequate muscle reserve when equipped one receptor agonist will discontinue to prevent the rebound weight gain which is almost all fat.

Speaker Change: in the 'seventeenth international confidence of the society of sarcieninia ks and wasting disorders being held december six of the eigh twent in washingtondc

Mitchell Steiner: I've also been invited to co-chair a session entitled, Body Composition Changes Induced by Glucagon Receptor Agonist and Obesity Therapy at the International Conference of the Society of Sarcopenia, Cachexia, and Wasting Disorders. We are very excited by the prospects of Inovasarm to address this new and important medical need. We are looking forward to the top-line results of this important and timely Phase IIb quality clinical study.

Speaker Change: I've also been invited to co-chair a session entitled Body Composition Changes Induced by Glucagon Receptor Agonists and Obesity Therapy at the International Conference of the Society of Sarcopenia, Cachexia, and Wasting Disorders.

Mitchell Steiner: We are very excited about the prospects of an ob-zarm to address this new and a point on medical need.

Speaker Change: We are very excited by the prospects of Inovasarm to address this new and important medical need. We are looking forward to the top-line results of this important and timely Phase IIb quality clinical study.

Mitchell Steiner: We are looking forward to the top-line results of this important and timely Phase 2B quality clinical study.

Mitchell Steiner: I'm proud of our team as they have the expeditiously executed the a noble's arm Phase II B quality clinical program. We prioritized the company's clinical development activities to address this new important I met need in November of 2023. We filed the I&D with the FDA in January of 2024. We received FDA clearance on the I&D in February of 2024. We made a strategic decision to upsize the size of the trial to 150 patients and increase the power of the study. We initiated this Phase II B clinical quality study in April of 2024. Clinical studies being conducted in 14 clinical sites in the United States.

Operator: With that, I now open the call to questions, operator. Yes, thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. To ask a question, you may press star or the 1 on your telephone keypad. If you're using a speakerphone,

Operator: With that, I'm now open to the call of the question operator. Yes, thank you. Ladies and gentlemen, at this time we will begin the question-and-answer session. You can ask a question; you may press a star, the one, and your telephone keypad. If you're using a speaker phone, we ask you please pick up your hands that before pressing the keys to ensure best sound quality.

Operator: Yes, thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. To ask a question, you may press star or the 1 on your telephone keypad. We will pause momentarily to assemble the roster.

Operator: Yes, thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. To ask a question, you may press star 1 on your telephone keypad. If you are using a speakerphone, we ask that you please pick up your handset before pressing the keys to ensure the best sound quality. To withdraw your question, please press star 1 and 2. Please limit yourself to one question and one follow-up.

Speaker Change: With that, I now open the call to questions, operator. Yes, thank you. Ladies and gentlemen, at this time we will begin the question and answer session.

Operator: If you have further questions, you may re-enter the question queue. Once again, that is star, then one, to rejoin the question queue. We will pause momentarily to assemble the roster. And the first question comes from Yi Chen with HC Wainwright. Thank you.

Speaker Change: To ask a question, you may press star or the 1 on your telephone keypad.

Speaker Change: If you are using a speakerphone, we ask that you please pick up your handset before pressing the keys to ensure best sound quality.

Operator: To withdraw your question, please rest. Strauss and Two. Please submit yourself to one question and one follow-up. If you have further questions, you may re-enter the question queue. Once again, let us star, then one to rejoin the question queue.

Speaker Change: To withdraw your question, please press star 1 and 2.

Speaker Change: Please limit yourself to one question and one follow-up. If you have further questions, you may re-enter the question queue. Once again, that is star, then one, to rejoin the question queue.

Operator: We'll pause on it terribly until December the roster.

Yi Chen: And the first question comes from Yi Chen with H.C. Wainwright. Thank you for taking the questions. A semi-positive resource coming out of the phase tribute quality study. How soon can you advance the candidate to the next step? And whether you plan to find a partnership for a potential registration study, thank you.

Speaker Change: 'll pos momentuntarily to some of the roster

Mitchell Steiner: This morning, this morning I'm pleased to report that we have completed the greater than 150 patient enrollment for the Phase II B quality study, can now anticipate that the last patient to complete the Phase 2B Quality Study will be in December of 2024 with top line clinical results of the Phase 2B Clinical Study expected in January of 2025. Furthermore, the top line results of the separate blinded Phase 2B Extension Clinical Study may now be expected in the second calendar quarter of 2025.

Speaker Change: And the first question comes from Yi Chen with H.C. Wainwright.

Yi Chen: Thank you for taking my questions. Assuming positive results coming out of the Phase IIb quality study, how soon can you advance the candidate to the next step, and whether you plan to find a partnership?

Mitchell Steiner: Thank you, Yi. So assuming we have a positive study, which means that now that we have complete enrollment, we can now have a little bit more certainty, have a lot more certainty in terms of how the trial will progress in terms of information. So the expectation is the last patient will complete the study, the 16-week portion of the study in December. Give us some time there to clean up the data and look at the data and get the top line results. We'll call it January.

Mitchell Steiner: Thank you, Yi. Assuming we have a positive study, which means that now that we have complete enrollment, we can now have a little bit more certainty, a lot more certainty in terms of how the trial will progress in terms of information. So the expectation is the last patient will complete the study, the 16-week portion of the study in December, giving us, you know, some time there to clean up the data and look at the data and get the top-line results. We'll call it January.

Speaker Change: for a potential registration study. Thank you.

Speaker Change: Thank you Yi. So, assuming we have a positive study, which means that now that we have complete enrollment...

Speaker Change: We can now have a lot more certainty in terms of how the trial will progress in terms of information.

Mitchell Steiner: We believe we have sufficient financial resources on hand, we cash at $29.2 million at the end of June 2024 to complete and provide results on both the Phase 2B Quality Clinical Trial and the Phase 2B Extension Clinical Trial.

Speaker Change: so the expectation is the last patient

Speaker Change: will complete the study, the 16-week portion of the study.

Speaker Change: in December .

Mitchell Steiner: So in January 2025, we will have quality Phase 2B clinical trial data. The reason I say that way is that the extension trial is not required for us to move forward with talking to the FDA or potentially talking to partners. So really, it's the data that we get in January that will start the ball rolling from a standpoint of moving forward. So moving forward means, you know, collecting the information, going back to the FDA, and starting having, you know, further discussions now with real data at hand.

Speaker Change: Give us some time there to clean up the data and look at the data and get the top line results. Call it January .

Mitchell Steiner: So in January 2025, we will have the phase to be quality clinical trial data. The reason I say that way is the extension trial is not required for us to move forward with talking to the FDA or potentially talking to the FDA. So really, it's the data that we get in January that will start to borrow rolling from a standpoint of moving forward. Moving forward means collecting information; go back to the FDA and start having further discussions now with real data in hand. I mean, you know, this data really represents the first muscle drug, and we have competition with, for example, Modesty and Hivers, but this is this data will be the first muscle drug to be given in combination and clip one to see what the results look like.

Michele Greco: I will now turn the call over to Michele Greco, CFO CEO, to discuss the financial highlights. Michele.

Speaker Change: So in January 2025, we will have the Phase IIb quality clinical trial data. The reason I say it that way is the extension trial is not required for us to move forward with talking to the FDA or potentially talking to partners.

Michele Greco: Thank you, Dr. Steiner. Let's start our highlights with the third quarter results for the three months ended June 30, 2024. Overall, net revenues were $4 million compared to $3.3 million in the prior year's third quarter. The company's quarterly sales for its U.S, prescription business were $552,000 compared to $863,000 in the prior year's third quarter. Net revenue from the global public sector business for the quarter was $3.4 million compared to $2.5 million in the prior year's quarter.

Speaker Change: So really it's the data that we get in January that will start the ball rolling from a standpoint of moving forward.

Speaker Change: moving forward means quiteick information go back to the fda and start having further discussions now with real data and hand i mean i want this data

Mitchell Steiner: I mean, I want, you know, this data to really represent the first muscle drug, and we have competition with, for example, myostatin inhibitors, but this will be the first muscle drug to be given in combination with GLP-1 to see what the results look like. I mean, all these other drugs pretty much have no clinical data in combination with GLP-1, and the data that they use to move forward to their phase twos, just like us, is data showing muscle preservation, reduction in fat, and other conditions, not in combination with GLP-1.

Speaker Change: It really represents the first muscle drug. We have competition with, for example, myostatin inhibitors, but this data will be the first muscle drug to be given in combination with GLP-1 to see what the results look like.

Michele Greco: The increase in the public sector business is for increased shipments under our contracts with UNFPA and USAID. Overall, gross profit was $1.3 million or $34% of net revenues compared to $1.2 million or $37% of net revenues in the prior year quarter. Gross profit increased due to an increase in units sold. The decrease in gross margin is due to the change in sales mix with the U.S, prescription business which has a higher profit margin comprising a smaller percentage of total net revenues.

Mitchell Steiner: I mean, all these other drugs pretty much have no clinical data in combination with a clip one, and the data that they use to move forward with their phase two is just like us, is data showing muscle preservation, reduction in fat, and other conditions, not in combination with a clip one. So, with that said, we should, you know, we have a real opportunity to meet with the FDA and understand what the clinical phase three clinical program will look like. With that said, also, this is also an ideal time with data in hand to begin to have discussions for potential partnerships.

Speaker Change: I mean all these other drugs pretty much have no clinical data in combination with GLK1.

Speaker Change: And the data that they used to move forward to their Phase IIs, just like us, is data showing muscle preservation, reduction in fat, and other conditions, not in a combination of a group one.

Mitchell Steiner: So with that said, we have a real opportunity to meet with the FDA and understand what the phase three clinical program will look like. With that said, also, this is also an ideal time, with data in hand, to begin to have discussions about potential partnerships. As I mentioned in previous calls, we have talked to the major players, and as you would expect, the expectation is for us to get this study done so we'll have real data so we can have real discussions. And so the way to think of it is that after January, it gives the company the opportunity to begin moving on the regulatory front and moving on the partnership.

Speaker Change: so with that said we should wewill have a real opportunity we would fa and understand what the clinical the face clinical program and look like

Michele Greco: Operating expenses for the quarter decrease to $12.4 million compared to the prior year's quarter of $19.7 million. The decrease is primarily due to research and development costs which decrease to $4.9 million compared to $8.8 million in the prior year quarter and the decrease in selling general and administrative expenses of $3.4 million from $10.9 million in the prior year quarter.

Speaker Change: With that said, also, this is also an ideal time with data in hand.

Yi Chen: As I mentioned previous calls, we have talked to the, you know, the major players as you would expect. The, you know, the expectation is for us to, you know, get this study done so we'll have real data so we can have real discussions. And so that's so the way to think of it is after January, he gives the company opportunity to begin moving on the regulatory front and moving on the partnership front. Got it. That's helpful.

Speaker Change: to begin to and i have discussions for potential partnerships

Speaker Change: As I mentioned in previous calls, we have talked to the major players.

Speaker Change: As you would expect, you know, the expectation is for us to, you know, get this study done so that we'll have real data so that we can have real discussions. And so that's – so the way to think of it is, you know, after January , it gives the company the opportunity to begin.

Michele Greco: The $7.5 million in the current quarter. The decrease in research and development cost is due to our drug development strategy to focus development efforts on those drug candidates with the best opportunity for long-term success and shareholder value creation while matching available funding. During the quarter we initiated the phase 2B quality clinical study. The decrease in selling general and administrative expenses is primarily due to significant costs incurred in the prior year related to preparation for the potential commercialization of submissive urine for COVID-19 prior to the FDA's declination of the company's EUA application and an increase in personnel costs in the prior year due to increase headcount for the potential commercialization.

Speaker Change: Moving on the regulatory front and moving on the partnership front.

Operator: Thank you.

Speaker Change: Got it. That's helpful. Thank you. Thank you.

Operator: Thank you. And the next question comes from Leland Gershell, with Oppenheimer.

Leland Gershell: And the next question comes to Leland Gershaw with Oppenheimer. Hey, Mitch. Thanks for the question. I just have a question, actually, on safety in the trials. Are you referencing the five studies that you referenced with the Nobus arm? I think the high dose was three milligrams. I know you're testing up to six in the current quality study. I just want to ask kind of what gives you confidence that you'll be okay, do through the respect to liver at six. And are there any considerations with respect to the types of patients in the study, i.e., you know, overweight obese, therefore, you know, may have may have a bad accumulation of liver cadet, put them in, you know, for the risk of having liver injuries.

Leland Gershell: Hey Mitch, thanks for the question. It's actually just a question on safety. In the trials that you referenced, I think the five studies that you referenced with NOVASARM. The high dose was three milligrams. I know you're testing up to six in the current quality study. Just wanted to ask kind of what gives you confidence that you'll be okay, particularly with respect to liver, at six, and are there any considerations with respect to the types of patients in the study, i.e., overweight, obese, therefore, may have... You know, may have bad accumulation in the liver. Could that put them at risk of having liver injury? And also, is there any provision for our alcohol cessation during the study, which also could be a factor? Thank you.

Speaker Change: Thank you. And the next question comes from Leland Gershell with Oppenheimer.

Speaker Change: himage thanks strgreatetly question a question actually safety in the trials are you representing the five studies that you you were prce with can nobthe arm

Leland Gershell: I think the high dose was three milligrams. I know you're testing up to six in the current quality study. Just wanted to ask kind of what gives you confidence that you'll be okay?

Speaker Change: particularly with respect to liver at six, and are there any considerations with respect to the types of patients in the study, i.e., you know, overweight, obese, therefore, you know, may have...

Michele Greco: These additional costs and incremental headcount have now been reduced post the EUA declination, and April 19, 2023. We sold our entad-feed product on kinetics for $20 million. We receive $6 million at closing and promissory notes of $14 million, which are recognized as additional gain on the sale when non-refundable consideration is received. During the current quarter, we recognize an additional gain on sale of $110,000, compared to the gain on sale of $4.7 million in the prior period.

Leland Gershell: Overweight and obese, therefore, may have, may have bad accumulation in the liver. Could that put them at risk of having liver injury? And also, is there any provision for our alcohol cessation during the study, which also could be a factor? Thank you.

Speaker Change: May have bad accumulation in the liver, could that put them in further risk of having liver injury and also is there any provision for alcohol cessation during the study which also could be a factor. Thank you.

Mitchell Steiner: And also, is there any provision for our alcohol cessation during the study, which also could be effective? Thank you. Yeah, thank you.

Mitchell Steiner: Thank you. I'm going to answer a couple of those questions, and then I'm going to ask Dr. Gary Barnett, our Chief Scientific Officer, to answer some of those questions. As it relates to the database, you're absolutely right. The database that we have for muscle as an endpoint goes up to 3 milligrams. Of course, we have single ascending dose and multiple ascending dose studies that were done at much higher doses, up as high as 100 milligrams.

Mitchell Steiner: So, so the answer, the first, I'm going to answer a couple of those questions; then I'm going to ask Dr. Gary Barnand or two scientific officers to answer some of those questions. So, as it relates to the database, you absolutely write the database that we have for muscle at an endpoint goes up to three milligrams. Of course, we have a single ascending dose and multiple ascending dose studies that were done in much higher doses of as high as a hundred milligrams. And, but I need to remind everybody that we also have done almost 250 patients at nine milligrams or 18 milligrams in our breast cancer program.

Gary Byad: thank you so so the answer the first i'm going toanswer a couple of those questions mean ask dr gary by ad are chief scientific officer to answer some of those quite some of those questions so as the relates to the database you absolutely write the database that we have a muscle with an endpoint

Michele Greco: The operating loss for the quarter was $10.9 million, compared to $13.7 million in the prior quarter. Non-operating income was $132,000, compared to $1.3 million in the prior year's quarter. The reduction is primarily due to the change in the fair value of the derivative liabilities related to the FC2 synthetic royalty financing. For the quarter, rerecorded a tax expense of $162,000, compared to $58,000 in the prior year's quarter. The bottom line result for the third quarter was a net loss of $11 million, or $0.7 per diluted common share, compared to a net loss of $12.5 million, or $14 per diluted common share in the prior year's quarter. During the third quarter, we use cash of $5.6 million for operating activities.

Dr Gary: goes up to three millegrams of course we have single ascending thosese in multiple sending those studies that would done a much higher doses of was high a hundred millograms

Mitchell Steiner: I need to remind everybody that we also have done almost 250 patients at 9 milligrams or 18 milligrams in our breast cancer program. Some patients have been taking those doses for as long as two years. So we do have data for safety above the six milligrams, but with that, and then in this patient, and again, we saw no evidence of liver toxicity defined as drug-induced liver injury. As it relates to triglycerides, one of the things that we did see in a different patient population, the older patients, men over the age of 60 and women post-menopausal, is that we did see about a 30% reduction in triglycerides.

Dr Gary: and

Speaker Change: but need to remind everybody that we also have done almost two hundred fifty patients at nine milligrams at eighteen millegrams in our breast cancer program and some patients have been taking those doses who as high as as long as you know two years ss

Mitchell Steiner: And some patients have been taking those doses for as high as, as long as, you know, two years plus. So, we do have data for safety above the six milligrams. And, but with that, and then in this patient, and again, we just don't know, no evidence of liver toxicity defined as drug-induced liver injury. As it relates to triglycerides, one of the things that we did, you know, we did see in a different patient population, the older patients, men over the age of 60 and women, the postmenopausal, is we did see about a 30% reduction in triglyceride.

Samuel Fisch: But with that, and then in this patient, and again, we saw no evidence of liver toxicity defined as drug-induced liver injury. As it relates to triglycerides, one of the things that we did see in a different patient population, the older patients, men over the age of 60 and women post-menopausal, is that we did see about a 30% reduction in triglycerides. So one of the mechanisms, if you worry about overweight patients or obese patients that may have a fatty liver, we may be able to reduce the triglycerides, which is the source of the fatty liver. As it relates to alcohol, I'm going to have to ask Dr. Gary Barnett what we're doing in the clinical trial.

Dr Gary: so we do have data for safety above the six mildlegram

Dr Gary: and but with that and then in this patient and again we saw there with no no evidence of liver toxicity defined as drug into

Michele Greco: Now turning to the results for the nine months ended June 30th, 2024. For the first nine months of fiscal 2024, total net revenues were $10.2 million, compared to $12.4 million in the prior year period. Net revenues from the U.S, prescription business were $1.8 million, compared to $5.2 million in the prior year period. Included in the net revenues for the prior period were $3.9 million for sales to the pill club. The reduction of prescription business net revenues is due to not having any revenues from the pill club in the current period due to the fact the pill club's chapter 11 bankruptcy filing in the prior year.

Speaker Change: As it relates to triglycerides, one of the things that we did see in a different patient population

Dr Gary: older patients, men over the age of 60 and women postmenopausal, is we did see about

Mitchell Steiner: So one of the mechanisms for if you worry about overweight patients or obese patients that may have a fatty liver, we may be able to reduce the triglycerides, which is the source of the fatty liver. As it relates to alcohol, I'm going to have to ask Dr. Gary Barnett what we're doing in a clinical trial.

Gary Barnett: So, one of the mechanisms where if you worry about, you know, overweight patients or obese patients that may have fatty liver, you know, we may be able to, you know, reduce the triglycerides, which is the source of the fatty liver.

Dr Gary: a 30% reduction in triglyceride.

Dr Gary: So, one of the mechanisms, if you worry about overweight patients or obese patients that may have fatty liver, we may be able to reduce the triglycerides, which is the source of the fatty liver.

Gary Barnett: As it relates to alcohol, I'm going to have to ask Dr. Garry right now what we're doing in a clinical protocol. Yeah, we are not; we're not excluding alcohol. We do monitor the alcohol history and the alcohol intake as we, as we go forward. Of course, we're excluding patients with alcohol-associated cirrhosis. We're not excluding the intake of alcohol during the study, but we do monitor that.

Speaker Change: As it relates to alcohol, I'm going to have to ask Dr. Gary Barnett what we're doing in the clinical protocol.

Gary Barnett: We are not excluding alcohol. We do monitor the alcohol history and the alcohol intake as we go forward. Of course, we're excluding patients with alcohol-associated cirrhosis, alcohol-associated hepatitis, alcohol-associated fatty liver. If we know those things, they're excluded from the study. But we don't exclude the intake of alcohol during the study, but we do monitor that.

Michele Greco: Net revenues from the global public sector business for the period were $8.4 million, compared to $7.2 million in the prior year's period. Overall, gross profit was $3.2 million, or $31% of net revenues, compared to $6 million, or $48% of net revenues in the prior year period. The decrease in gross profit in gross margin is due to the change in the sales mix with the U.S, prescription business which has a higher profit margin, comprising a smaller percentage of total net revenues and an increase in our cost of sales due to a charge of $1.2 million for an obsolete stack reserve related to inventory in the U.S, prescription channel.

Speaker Change: We are not excluding alcohol. We do monitor the alcohol history and the alcohol intake.

Speaker Change: as we go forward. Of course, we're excluding patients with alcohol-associated cirrhosis and alcohol-associated hepatitis, alcohol-associated fatty liver. If we know those things, they're excluded from the study.

Speaker Change: but we're not we don't exclude the intake of call during a study that we do monitor that

Leland Gershell: Got it. Thank you very much for the color. I look forward to the top line results.

Gary Barnett: Thank you very much for the color of the court to the top line results. Great, thank you.

Speaker Change: Thank you very much for the color. I look forward to the top-line results.

Gary Nachman: Thank you, and the next question, Chris and Gary Nockman with Raymond James. Hi guys, this is K just on for Gary. Congrats on the quarter. So, my first question is, can you just talk about how you're expecting the phase to be to progress now that you're fully enrolled? And if we should expect any incremental updates before you report top line in January, and all in that safety question, are you pleased with everything you're seeing with the safety committee thus far in that current trial? And then I also have a follow-up. Thank you very much.

Operator: Thank you. And the next question is from Chris and Gary Nachman with Raymond James.

Speaker Change: Great, thank you.

Speaker Change: thank you and then next question chrison gryknock with r d james

Gary Nachman: Hi guys, this is Kageson for Gary.

Gary Nachman: Hi guys, this is Kajet San for Gary. Congratulations on the quarter. So my first question is, can you just talk about how you're expecting the phase to progress now that you're fully enrolled? And if we should expect any incremental updates before you report the top line in January. And on that safety question, are you pleased with everything you're seeing with the safety committee thus far in that current trial? And then I also have a follow-up.

Samuel Fisch: Congratulations on the quarter. So my first question is, can you just talk about how you're expecting the phase to progress now that you're fully enrolled? And if we should expect any incremental updates before you report top line in January? And on that safety question, are you pleased with everything you're seeing with the safety committee thus far in that current trial? And then I also have a follow-up.

Speaker Change: Hi guys, this is Tejas Song for Gary. Congrats on the quarter. So my first question is

Michele Greco: Operating expenses decreased by $63.4 million to $32.9 million, compared to the prior year of $96.4 million. The decrease is driven by a reduction in research and development costs of $37.7 million to $9.5 million from $47.3 million in the prior year. And a reduction in selling general and administrative expenses of $17.9 million from $41.3 million in the prior year to $23.4 million. The factors contributing to the decrease in research and development costs and selling general and administrative expenses are the same as those described for the quarter.

Tejas Song: Can you just talk about how you're expecting the phase to be to progress now that you're fully enrolled, and if we should expect any incremental updates before you report top line in January ? And on that safety question, are you pleased with everything you're seeing with the safety committee thus far in that current trial? And then I also have a follow-up.

Mitchell Steiner: Yeah, so it relates to the phase two and what to expect. So, I promise we will announce when we fully enroll the study, and so that's probably the last announcement in terms of progress because the last patient out will be December. And so, the next report will be the actual top line data. As it relates to safety, we're pleased with what we're seeing so far, but we enrolled 150 patients in three months and so many of these patients are just starting their first part of their first month, so we still early times, but again the three milligram dose we've used in five clinical trials and other trials and then we've used nine milligram and 18 milligram, but we're not expecting anything strange, but that's why we run the study and that's what we're going to follow. And so it's hard to say much more about safety this point except there's no surprises. And then as it relates to, we'll be asking another question after that you said as a, yeah, I just wanted to ask a little bit more about some of the secondary appointments in the phase 2v and then how do you expect them to trend and specifically on the HOMA IR?

Mitchell Steiner: Yeah. So, as I promised, we would announce when we fully enroll the study. And so, that's probably, you know, the last announcement in terms of progress because the last patient out will be December. And so, the next report will be the actual top-line data.

Samuel Fisch: Yeah. So, as I promised, we would announce when we fully enroll the study. And so, that's probably, you know, the last announcement in terms of progress, because the last patient out will be December. And so, the next report will be the actual top-line data.

Speaker Change: Yeah, so as it relates to the phase two and what to expect, so as I promised we would announce when we fully enroll the study and so that's probably the you know the last announcement in terms of progress because the last patient out will be December .

Speaker Change: And so the next report will be the actual top-line data.

Michele Greco: During the prior year, we also recorded an impairment charge of $3.9 million related to in-process research and development costs and a provision for credit losses of $3.9 million related to the receivables from the pill club. During the nine months, we recorded again on the sale of a taffy of $1 million compared to $4.7 million in the prior period. Operating loss for the period was $28.7 million compared to $85.6 million in the prior year, a decrease of $56.9 million, which is primarily due to the reduction in operating expenses.

Speaker Change: as we relates to safety

Mitchell Steiner: As it relates to safety, you know, we're pleased with what we're seeing so far. But, you know, we enrolled 150 patients in 3 months. And so, many of these patients are still just starting part of their first month. So, we, you know, it's still early times. But, again, you know, the 3-milligram dose we've used in 5 clinical trials and, you know, other trials. And then we've used 9-milligram and 18-milligram.

Samuel Fisch: As it relates to safety, you know, we're pleased with what we're seeing so far. But, you know, we enrolled 150 patients in three months. And so, many of these patients are still just starting part of their first month. So, we, you know, it's still early times. But, again, you know, the 3-milligram dose we've used in five clinical trials and, you know, other trials. And then we've used 9-milligram and 18-milligram.

Speaker Change: it'swe're pleased with what we're seeing so far

Speaker Change: But, you know, we enrolled 150 patients in three months. And so many of these patients are still just starting part of their first month. So we, you know, it's still early times, but again, you know, the three milligram dose we've used.

Speaker Change: in five clinical trials and other trials, and then we've used 9mg and 18mg, so we're not expecting...

Mitchell Steiner: So, we're not expecting anything strange, but that's why we run this study and that's what we're going to follow, and so it's hard to say much more about safety at this point except that there's no surprise. And then, as it relates to... And you can ask another question after that, you said, as a...

Samuel Fisch: So, we're not expecting anything strange, but that's why we run this study and that's what we're going to follow, and so it's hard to say much more about safety at this point, except that there's no surprise. You can ask another question after that, you said, as a...

Michele Greco: Non-operating expenses were $289,000 compared to operating income of $508,000. For the nine months, we recorded a tax expense of $272,000 compared to a tax benefit of $77,000 in the prior year. The bottom line result for the first nine months of fiscal 2024 was a net loss of $29.3 million or $22 cents per diluted common share compared to a net loss of $85 million or $1.2 cents per diluted common share in the prior year.

Speaker Change: anything strange, but that's why we run this study, and that's what we're going to follow. And so it's hard to say much more about safety at this point, except there's no surprises.

Speaker Change: and then there's it relates to you've been askking another question after that you said asa

Gary Nachman: Yeah, I just wanted to ask a little bit more about some of the secondary endpoints in the Phase IIb trial and then how you expect them to trend, and specifically on the HOMA-IR, can you talk a bit more about the significance of that and what you're hoping to show?

Speaker Change: Yeah, I just wanted to ask a little bit more about some of the secondary endpoints in the Phase IIb, and then how do you expect them to trend, and specifically on the HOMA-IR, can you talk a bit more about the significance of that and what you're hoping to show?

Mitchell Steiner: Can you talk a bit more about the significance of that and what you're hoping to show? Yeah, so HOMA IR we have we have we have mistakenly put on our slide that we were measuring HOMA IR in this patient population. We have measured HOMA IR in previous patient populations and show the benefit of insulin resistance, but this phase 2, given how short it is, we decided to move the HOMA IR into the next study, so the phase 3 study, so that won't be one of the data points that you'll see. You will see again lean body mass, fat mass, which will be the body composition, and points will have total weight, body weight. So we'll see that, and then from a functional endpoint, we'll be measuring physical function by stericline.

Samuel Fisch: Yeah. So HOMA-IR, we have mistakenly put on our slide that we were measuring HOMA-IR in this patient population. We have measured HOMA-IR in previous patient populations and shown the benefit in insulin resistance. For this Phase II, given how short it is, we decided to move HOMA-IR into the next study, so the Phase III study.

Mitchell Steiner: Yeah. So HOMA-IR, we have mistakenly put on our slide that we were measuring HOMA-IR in this patient population. We have measured HOMA-IR in previous patient populations and shown the benefit in insulin resistance. For this Phase II, given how short it is, we decided to move HOMA-IR into the next study, so the Phase III study.

Speaker Change: yes so homeomi we have we have a we have mistakenly put on our slide that we were measuring homeom r in this patient population

Speaker Change: We have measured HOMA-RIR in previous patient populations and show the benefit in insulin resistance. For this phase two, given how short it is, we decided to move the HOMA-RIR into the next study, so the phase three study. So that will be one of the data points that you'll see.

Samuel Fisch: So that will be one of the data points that you'll see. You will see, again, lean body mass and fat mass, which will be the body composition endpoints. We'll have total weight, and body weight, so we'll see that.

Mitchell Steiner: So that will be one of the data points that you'll see. You will see, again, lean body mass and fat mass, which will be the body composition endpoints. We'll have total weight, and body weight, so we'll see that.

Samuel Fisch: You will see, again, lean body mass.

Speaker Change: Fat mass

Samuel Fisch: which will be the body composition endpoints.

Speaker Change: we'll have to to a weight bodyweight

Samuel Fisch: And then, from a functional endpoint, we'll be measuring physical function by steroid. And so I think that's key. The other thing that's key, in those five clinical studies that we did in almost 968 patients, about 900 of those patients, we did stair climb. So we know how to do stair climb, and we've learned a lot about how to execute on that endpoint. Dr. Barnett, do you want to add anything to that?

Mitchell Steiner: And then from a functional endpoint, we'll be measuring physical function by sterocline. The reason that's important is because sterocline power, a sterocline test, is a sensitive measure of quadricep strength and is sensitive to testosterone and androgen anabolic stimulation. And it's also a test that the FDA has told us in writing is the acceptable function end point. To pause for a moment, as you know, there are many you may have heard, like grip strength, leg press, and chest press.

Speaker Change: so we'll see that and then from a functional endpoint will be measuring physical function by sterolilim

Mitchell Steiner: The reason that's important is because stericline power, stericline test is a sensitive measure of quadricep strength and and a sensitive to testosterone and antiballic stimulation and it's also a test that the FDH told us in writing is the acceptable function endpoint. Depends for a moment as you know there many, as you may have heard, like grip strength and leg press and chest press. The FDH told us those are not acceptable functional endpoints, so the functional endpoint that we've chosen in the study, stericline power, is you know is accepted by FDA. In fact, a talo pharma with the F had the musco dystrophy drug approved, and it gets about six months ago.

Speaker Change: The reason that's important is because stair climb test is a sensitive measure of quadricep strength.

Michele Greco: Our net working capital was $27.9 million on June 30, 2024 compared to $5.1 million on September 30, 2023. During the nine-month ended June 30, 2024, we used cash at $17.3 million for operating activities compared with $78.5 million used for operating activities in the prior period. We generated cash from financing activities for the nine-month ended June 30, 2024 of $36.8 million compared to $9 million in the prior period.

Speaker Change: and is sensitive to testosterone and androgen and anabolic stimulation. And it's also a test that the FDA has told us in writing is the acceptable function endpoint.

Dr. Barnett: de pos for a moment as you know there many that you may have heard like gri strength and like press and chess press the fd eight told us those are not acceptable functional endpoin

Mitchell Steiner: The FDA told us those are not acceptable functional end points. So the functional end point that we chose in the study, sterocline power, is accepted by FDA. In fact, talofarma, with an F, had the muscodystrophy drug approved, I guess about six months ago.

Dr. Barnett: So the functional endpoint that we've chosen in the study, serocline power, is accepted by FDA. In fact, talofarma, with an F, had the muscular dystrophy drug approved, I guess about six months ago.

Michele Greco: On December 18, 2023, we completed an underwritten public offering of our common stock, which included the exercise in full of the underwriter's options purchase additional shares. Net proceeds to the company from this offering were approximately $35.2 million after deducting underwriting discounts and commissions and costs incurred by the company. All this share sold were offered by the company. We are working to increase the future FT2 net revenues in the U.S. Prescription Channel by growing awareness and driving demand of FT2 through increased marketing efforts for our own telehealth platform. We are starting to see increases in our global public sector business from efforts to increase FT2 market awareness in developing countries. Dr. Stiner, Dr. Stiner.

Gary Barnett: And so, the so I think that's that's key. The other thing it's key in those five clinical studies that we did in almost 968 patients; about 900 of those patients we did stericline. So we know how to do stericline. It was learned a lot and how to execute on that endpoint.

Gary Barnett: And so I think that's key. The other thing that's key, in those five clinical studies that we did in almost 968 patients, about 900 of those patients, we did stair climb. So we know how to do stair climb, and we've learned a lot about how to execute on that endpoint. Dr. Barnett, do you want to add anything to that?

Samuel Fisch: And so I think that's key. The other thing that's key.

Samuel Fisch: in those five clinical studies that we did almost nine hundred associate patients about nine hundred of those patients we did st c ents so we don't have to stairclimim to learn the lot and how they execute on that endpoint dr barnnet do you want to add anything

Gary Barnett: Dr. Barnett, do you want to add to anything? to that. Yeah, that's exactly right. And we're looking for changes in lean mass. We're looking for maintenance of lean mass in our treaty group versus a loss in lean mass in the placebo group. And we're looking to assess how much fat we can, how much we can augment the fat loss. That's the main focus of this study. Thanks for that color, guys. Thank you.

Samuel Fisch: Now, yeah, that's exactly right, and we're looking for changes in lean mass. We're looking for maintenance of lean mass in our treated group versus a loss of lean mass in the placebo group, and we're looking to assess how much fat we can lose and how much we can augment the fat loss. That's the main focus of this study.

Gary Barnett: Yeah, that's exactly right, and we're looking for changes in lean mass; we're looking for maintenance of lean mass in our treated group versus a loss of lean mass in the placebo group, and we're looking to assess how much fat we can lose and how much we can augment the fat loss. That's the main focus of this study.

Samuel Fisch: to that

Yeah, that's exactly right. And we're looking for changes in lean mass. We're looking for maintenance of lean mass in our treated group versus a loss in lean mass in the placebo group. And we're looking to assess how much fat we can.

Mitchell Steiner: Thank you, Michele. All of the GLP-1 receptor agonists work mainly by creating a low-caloric starvation state by reducing appetite, the results in the non-selective loss of both muscle and fat tissues to cause weight loss. Using a muscle-reserving drug can also decrease fat mass like a nobo-zarm, and combination of group-1 receptor agonists may allow for the enhanced reduction of fat mass for high quality, higher quality, precision weight loss, and not only older patients who are overweight or obese, but also for all patients who are overweight or obese.

Speaker Change: how much we can eliminate the fat loss. That's the main focus of this study.

William Wood: Thank you. The next question comes from William Wood with B-Rally Securities.

Operator: Thank you. The next question comes from William Wood with B-Rally Securities.

William Wood: Thanks for that call, guys.

William Wood: And that next question, Constan William, what would be Riley's securities? Appreciate it for taking my questions, and congratulations on a quarter. Just looking for a little extra color here on what we might expect in January for the top line data. Is this going to be like simply lean mass loss being reported, or will you provide any extra details on the body weight loss and or the fat loss war, specifically the functional improvements? Yeah, great question. So the question, because you were a little garbled, but I think the basic question that I heard is that when you report in January, what can we expect in terms of top line data and the kinds of top line data that we'll get?

William Wood: Thank you.

Speaker Change: Thank you. And the next question comes from William Wood with B-Rally Securities.

William Wood: Appreciate it for taking my questions, and congratulations on the quarter. Just looking for a little extra color here on what we might expect in January for the top-line data. Is this going to be, like, simply lean mass loss being reported, or will you provide any extra details on the body weight loss and or, you know, the fat loss, or specifically the functional improvements? Yeah.

William Wood: Appreciate it for taking my questions, and congratulations on a quarter. Just looking for a little extra color here on what we might expect in January for the top-line data. Is this going to be, like, simply lean mass loss being reported, or will you provide any extra details on the body weight loss and or, you know, the fat loss, or specifically the functional improvements?

Mitchell Steiner: This is truly an unmet medical need. We believe that a nobo-zarm is the best investigational drug candidate to address the muscle loss caused by GLP-1 receptor agonist drugs for weight loss. Nobo-zarm is a first-in-class arm. It has a once-a-day-world dosing, it has demonstrated tissue selectivity, utilized a well-known mechanism of action, the antireceptor to favorably change body composition. Activation of the antireceptor increases muscle mass, improves physical function, and decreases fat mass to potentially achieve a high-quality weight loss. Nobo-zarm has a favorable safety profile, and would not add to the gastrointestinal side effects that are already observed with a GLP-1 receptor agonist treatment alone.

Mitchell Steiner: Yeah, great question. So, the question, because you were a little garbled, but I think the basic question that I heard is that, you know, when you report in January, what can we expect in terms of top-line data and the kinds of top-line data that we'll get? And the answer is, for sure, and I say it this way because a lot depends on our concern that if you report too much information, then all of a sudden now, you can't get all these societies and stuff don't want you to. I mean, you have to have a scientific meeting with new information.

Speaker Change: Yeah, great question. So the question, because you were a little garbled, but I think the basic question that I heard is that when you report in January , what can we expect in terms of top line data?

Mitchell Steiner: And the answer is, for sure. I say this way because because the lot depends on our concern that if you report too much information, then all of a sudden now, you know, you can't get all these all these societies and stuff don't want you don't want you to. I mean, you have to have a scientific meeting with new information. So, with that said, the most important thing about the trial is reporting out on body composition. So certainly the primary endpoint of lean body mass and total fat mass. So you have a clear understanding of our dose response or the right dose to pick for the right preservation of muscle and reduction of fat compared to placebo.

Speaker Change: and the kinds of top-line data that we'll get. And the answer is, for sure, and I say it this way because a lot depends on...

Speaker Change: are concerned.

Speaker Change: that if you report too much information...

Speaker Change: Then all of a sudden now, you know, you can't get all these, all these societies and stuff don't want you, don't want you to...

Mitchell Steiner: So with that said, the most important thing about the trial is reporting out on body composition, so certainly, the primary endpoints of lean body mass and total fat mass, so you have a clear understanding of a dose response or the right dose to pick for the right preservation of muscle and reduction of fat compared to placebo.

Speaker Change: I mean, you have to have a scientific meeting with new information.

Speaker Change: So with that said, the most important thing about the trial is reporting out on body composition. So certainly the primary endpoint of lean body mass.

William Wood: and total fat mass so you have a clear understanding of our dos response

Mitchell Steiner: So we'll have that for sure. And then we'll just, you know, I just have to see how the societies and additional scientific meetings and that kind of stuff work out, what we can report. But as you know, in the springtime and the wintertime, there are a lot of meetings that will be going on. So if it's not right at the top-line data happening in January, it will be shortly thereafter at one of the major meetings.

William Wood: or the right dose to pick for the right preservation of muscle and reduction of fat compared to placebo. So we'll have that for sure. And then we'll just, you know, I just have to see how.

Mitchell Steiner: So we'll have that for sure. And then we'll just, we'll, you know, I just have to see how the societies and additional scientific meetings and that kind of stuff. What we can report. But as you know, in the spring time and the winter time, there are a lot of meetings that we'll be going on. So, so if it's not right in the top line data happening in January, it'd be shortly thereafter, one of the major meetings.

Speaker Change: how the societies and additional scientific meetings and that kind of stuff what we can report

Speaker Change: But as you know, in the springtime and the wintertime, there are a lot of meetings that will be going on. So if it's not right at the top line data happening in January , it will be shortly thereafter in one of the major meetings.

William Wood: Very helpful. And maybe actually just a question. I believe you mentioned that you're going to have a presentation at Obesity Week. You mentioned the abstract. Is this going to be I would say unseen data from past clinical trials, or is it going to be a little bit of what we've been seeing. Or potentially what we've seen already. It'll be it'll be additional data you have not seen. It's another analysis looking at data. So it's not repeat data that we've already shown. So it'll be you'll be new data from the old studies. Okay, helpful.

William Wood: Very helpful. And maybe actually just a quick question. I believe you mentioned that you're going to have a presentation at Obesity Week. You mentioned the abstract. Is this going to be, I would say, unseen data from past clinical trials, or is it going to be a little bit of what we've been seeing or potentially what we've seen already?

Samuel Fisch: Very helpful. And maybe actually just a quick question. I believe you mentioned that you're going to have a presentation at Obesity Week. You mentioned the abstract. Is this going to be, I would say, unseen data from past clinical trials, or is it going to be a little bit of what we've been seeing or potentially what we've seen already?

Mitchell Steiner: I've also been invited to co-chair a session entitled Body Composition Changes induced by GLP-1 receptor agonist and obesity therapy at the International Conference of the Society of Sarcopenia, Kekexia and Wasting Disorders. We are very excited about the prospects of an ob-zarm to address this new and a point on medical need.

Samuel Fisch: Got it. Very helpful. And maybe actually just a quick question. I believe you mentioned that you're going to have a presentation at Obesity Week. You mentioned the abstract. Is this going to be...

Samuel Fisch: i i would say the unseening data from past clinical trials or is it going to be a little bit of what we've been seeing or potentially what we've seen already

Mitchell Steiner: It'll be additional data that you have not seen; it's another analysis looking at data, so it's not repeat data that we've already shown, so it'll be new data from the old studies.

Operator: It will be additional data that you have not seen; it's another analysis looking at data, so it's not repeat data that we've already shown. So it will be new data from the old studies.

Mitchell Steiner: We are looking forward to the top-line results of this important and timely phase 2B quality clinical study.

Operator: It will be additional data that you have not seen. It's another analysis looking at data. So it's not repeat data that we've already shown. So it will be new data from the old studies.

Operator: With that, I'm now open to the call of the question operator. Yes, thank you.

William Wood: Okay, helpful. That's it. I'll jump back in queue. Thank you so much.

Operator: That's it. I'll jump back and see you. Thanks so much. Thank you. Appreciate it. Thank you.

Operator: Ladies and gentlemen, at this time we will begin the question and answer session. You can ask a question, you may press a star, the one, and your telephone keypad. If you're using a speaker phone, we ask you please pick up your hands that before pressing the keys to ensure best sound quality.

Mitchell Steiner: Thank you; I appreciate it.

Operator: Thank you, and again, if you'd like to ask a question, please press star, then 1. To withdraw your question, press star, then 2.

Operator: Thank you, and again, if you'd like to ask a question, please press star, then 1. To withdraw your question, press star, then 2. And the next question comes from Dennis Ding with Jeffery.

Operator: And again, if you'd like to ask a question, please press star of the one. To drive your question, press star of the zoo.

Dennis Ding: And the next question comes from Dennis Ding with Jefferies.

Operator: To withdraw your question, please rest. Strauss and two. Please submit yourself to one question and one follow-up. If you have further questions, you may re-enter the question queue. Once again, let us star, then one to rejoin the question queue.

Operator: Hi, this is Antia on for Dennis. Thanks for taking for our questions.

Dennis Ding: Hi, this is Anthea on behalf of Dennis. Thanks for taking our questions. Two from us, on STAIR Climb Power. Could you talk a little bit about what the MCID is for the measure and what would be a successful outcome in phase two? And on phase three, you've spoken previously about moving forward in elderly patients only versus the broader obesity population. Can you just let us know your thinking there and how phase two informed that decision? Thank you.

Anthea: Hi, this is Anthea on behalf of Dennis. Thanks for taking our questions. Two from us, on STAIR Climb Power. Could you talk a little bit about what the MCID is for the measure and what a successful outcome in phase two would be? And on phase three, you've spoken previously about moving forward in elderly patients only versus the broader obesity population. Can you just let us know your thinking there and how phase two informed that decision? Thank you.

Anthea: Hi, This is anthea on for Doug. Thanks for taking my questions two from us on stair climb power could you talk a little bit about what the N C ideas for the measure and what would be a successful outcome in phase two and on the phase three is spoken previously about moving forward in <unk>.

Operator: Two from us on stair climb power, could you talk a little bit about what the MCID is for the measure and what would be a successful outcome in phase two. And on the phase three, you've spoken previously about moving forward in elderly patients only versus on the broader obesity population. Can you just let us know your thinking there and how the phase two informed that decision. Thank you. Great. So I'm going to take the second question first. And then the Dr. Barnand will talk about stair climb power in terms of what's deemed a success. So, in terms of the study, so to be very clear, the FDA has told us that in the phase three program, that they're looking forward to us having the opportunity to develop a drug in all patients that have obesity or overweight.

Operator: We'll pause on it terribly until December the roster.

Yi Chen: And the first question comes from Yi Chen with H.C. Wainwright. Thank you for taking the questions.

Anthea: Patients only versus on the broader obesity population.

Mitchell Steiner: A semi-positive resource coming out of the phase tribute quality study. How soon can you advance the candidate to the next step? And whether you plan to find a partnership for a potential registration study, thank you. Thank you, Yi. So assuming we have a positive study which means that now that we have complete enrollment, we can now have a little bit more certainty, have a lot more certainty in terms of how the trial will progress in terms of information.

Anthea: Can you just let us know your thinking there and how the phase two in Florida that decision. Thank you.

Anthea: Great.

Mitchell Steiner: So, I'm going to take the second question first, and then Dr. Barnett will talk about STAIR Crime Power in terms of what's deemed a success. So, in terms of the study, so to be very clear, the FDA has told us that in the Phase 3 program, they're looking forward to us having the opportunity to develop the drug in all patients that have obesity or are overweight. So, in other words, all comers.

Anthea: John I'm going to take the second question first.

Speaker Change: And and then Dr. Burnett will talk about stair climb power in terms of what what's deemed a success.

Speaker Change: So in terms of the studies so it would be very clear.

Speaker Change: The FDA has told us that in the phase III program that.

Mitchell Steiner: So the expectation is the last patient will complete the study, the 16-week portion of the study in December. Give us some time there to clean up the data and look at the data and get the top line results. We'll call it January. So in January 2025, we will have the phase to be quality clinical trial data. The reason I say that way is the extension trial is not required for us to move forward with talking to the FDA or potentially talking to the FDA.

Speaker Change: They're looking forward to us.

Speaker Change: Having the opportunity to.

Speaker Change: Develop the drug in all patients the B, a b C D or overweight so in other words, all comers and and and.

Mitchell Steiner: So, in other words, all commerce and their belief is that a muscle preservation drug will have benefit in an older, has benefit, older patients will have benefit in younger patients too. And so, so that's a positive sign that the FDA is, you know, well aware of body composition and how they're thinking about it. The FDA also said that one way forward would be to look for incremental weight loss. And now I'm talking about phase three programs now, incremental weight loss. It would be combination versus the versus the clip one alone. The incremental weight loss, the FDA did not commit to how much weight loss incremental weight loss.

Mitchell Steiner: And their belief is that a muscle preservation drug will have benefits in older patients and will have benefits in younger patients too. And so that's a positive sign that the FDA is well aware of body composition and how they're thinking about it. The FDA also said that one way forward would be to look for incremental weight loss, and this is now talking about phase 3 programs now, incremental weight loss with the combination versus GLP1 alone.

Samuel Fisch: and their belief is that a muscle preservation drug will have benefit in older patients, and if it has benefit in older patients, it will have benefit in younger patients too. The FDA also said that one way forward would be to look for incremental weight loss, and this is now talking about phase three programs now. Incremental weight loss with the combination versus GLP1 alone.

Speaker Change: They their belief is that the muscle preservation drug.

Speaker Change: We will have benefit in an older pay it has benefited all of the patients will have benefit in younger patients too.

Samuel Fisch: And so so that's a positive sign that the FDA is well aware of body composition and how they are thinking about it.

Mitchell Steiner: So really, it's the data that we get in January that will start to borrow rolling from a standpoint of moving forward. Moving forward means collecting information, go back to the FDA and start having further discussions now with real data in hand. I mean, you know, this data really represents the first muscle drug and we have competition with, for example, Modesty and Hivers, but this is this data will be the first muscle drug to be given in combination and clip one to see what the results look like.

Samuel Fisch: The F. D. A also says that one way forward would be to look for incremental weight loss.

Samuel Fisch: I'm talking about phase III programs now incremental weight loss.

Samuel Fisch: The combination versus the versus the clip one alone.

Mitchell Steiner: The incremental weight loss, the FDA did not commit to how much weight loss, or incremental weight loss, you should demonstrate because their position is that because you have a muscle preservation drug, they may benefit in other ways, such as physical function, HOMA RIR, as Gary Nachman brought up. There are other things, other benefits of having a muscle preservation drug that go beyond just adding muscle or preserving muscle just for the sake of doing it, so showing function is important.

Speaker Change: The incremental weight loss, she FTA did not commit to how much weight loss incremental weight loss.

Mitchell Steiner: You should you should demonstrate because their position is that because you have a muscle preservation drug, they may benefit in other ways, such as physical function, home on R is scary. Nockman brought up. There are other things, other benefits of having a muscle preservation drug that's beyond just the adding muscle or preserving muscle just for sake of doing it. So showing function is important. And so in a phase three program having those end points, it's key secondary end points and primary end point weight loss allows the FDA to look at the one point was a direct cut off on weight and that was it.

Speaker Change: You should see you should demonstrate because of their position is that because you have a muscle preservation drug they may benefit in other ways, such as physical function, a home or a scary document brought up are there other things other benefits of having a muscle preservation drug.

Mitchell Steiner: I mean, all these other drugs pretty much have no clinical data in combination with a clip one and the data that they use to move forward with their phase two is just like us is data showing muscle preservation reduction in fat and other conditions, not in combination with a clip one. So with that said, we should, you know, we have a real opportunity to meet with the FDA and understand what the clinical phase three clinical program will look like.

Samuel Fisch: That's beyond just the adding muscle of preserving muscle just for sake of doing it. So so showing function is important.

Mitchell Steiner: In a Phase III program, having those endpoints as key secondary endpoints and the primary endpoint, weight loss, allows the FDA to look at the totality of the data for clinical benefit and clinical meaningfulness, which is good because at one point, it was a direct cutoff on weight, and that was it, but now it's much more, and much more of the totality of the data. So what will inform us in this study, the Phase II, is not whether we're going to go after an older patient population.

Samuel Fisch: And so in our phase III program, having those endpoints as key secondary endpoints and the primary endpoint weight loss allows the FDA to look at the totality of the data for clinical benefit at clinical Meaningfulness, which is good because you know at one point it was a direct cut off on weight and that was it but now it's much more.

Mitchell Steiner: With that said, also, this is also an ideal time with data in hand to begin to have discussions for potential partnerships. As I mentioned previous calls, we have talked to the, you know, the major players as you would expect the, you know, the expectation is for us to, you know, get this study done so we'll have real data so we can have real discussions. And so that's so the way to think of it is after January, he gives the company opportunity to begin moving on the regulatory front and moving on the partnership front. Got it. That's helpful. Thank you.

Mitchell Steiner: But now it's much more, much more mortality data. So so so so what will inform us in this study. The phase two is not whether we're going to go after an older patient population. This study is meant to ask the question in an informative patient population, meaning doesn't it make sense that if you want to show a benefit in physical function, you pick patients that already have muscle loss and may already have functional limitations. And if you treat them with an antibiotic agent, selective antibiotic agent like an ovus arm, that you show a benefit in physical function.

Samuel Fisch: And much more to tally of the data.

Samuel Fisch: So what.

Samuel Fisch: What will inform us in this study.

Speaker Change: The phase two is not whether we're going to go after an older patient population. This study is meant to ask the question in a formative patient population, meaning it doesn't it make sense. If you wanted to show a benefit in physical function you pick patients who already have muscle loss in may already have functional limitations and.

Mitchell Steiner: This study is meant to ask the question in an informative patient population, meaning doesn't it make sense that if you want to show a benefit in physical function, you pick patients that already have muscle loss and may already have functional limitations, and if you treat them with an anabolic agent, a selective anabolic agent like Ganobazarm, and you show a benefit in physical function, so you're going to more likely show that in an So we have experience with older patients, and in older patients, at least certainly with a 3-milligram dose, the totality of the data shows that we hit function.

Samuel Fisch: And if you treat them.

Speaker Change: With a net of anabolic agents selective anabolic agent like in overtime and you show a benefit in physical function. So so you're going to more likely show that an older patient population, which by the way in the 950, some odd patients who've done five clinical studies they were older patients. So we.

Leland Gershell: And the next question comes to Leland Gershaw with Oppenheimer.

Leland Gershell: Hey, Mitch. Thanks for the question.

Leland Gershell: I just a question actually on safety in the trials. Are you referencing the five studies that you referenced with the Nobus arm? I think the high dose was three milligrams. I know you're testing up to six in the current quality study. I just want to ask kind of what gives you confidence that you'll be okay, do through the respect to liver at six. And are there any considerations with respect to the types of patients in the study, IE, you know, overweight obese, therefore, you know, may have may have a bad accumulation of liver cadet, put them in, you know, for the risk of having liver injuries. And also, is there any provision for our alcohol cessation during the study, which also could be effective?

Gary Barnett: So, so you're going to more likely show that an older patient population, which by the way in the 950 some odd patients, we've done five clinical studies. They were older patients. So we have experienced with older patients and older patients with at least certainly with the three milligram dose. The totality of the day shows that we hit function. So so so that would make sense. As you start thinking about a phase three program. Again, the totality of the whole approach would be to go to for our comers. And so, Gary, if you don't mind, can you comment on success?

Mitchell Steiner: Thank you. Yeah, thank you.

Samuel Fisch: Have experienced with all of the patients and older patients with at least certainly with the three milligram dose.

Samuel Fisch: The Italian data shows that we had function. So so so that would make sense as you start thinking about a phase III program.

Mitchell Steiner: So that would make sense. As you start thinking about a Phase III program, again, the totality, the whole approach would be to go for all comers. And so, Gary, if you don't mind, can you comment on success? Gary Barnett, our Chief Scientific Officer, can you comment on whether they will be considered successful with their client power, and then second, how we're thinking about the phase three development program as it relates to all comers but also having the subgroup for the older patients.

Samuel Fisch: Again, it's the totality of the.

Samuel Fisch: Oh approach would be to go for all comers and so Gary if you don't mind can you comment on success, Gary Barnett, Our Chief Scientific Officer can you comment on the success of what would be considered a success with stair climb power and then second how you how we're thinking about the phase III are there.

Mitchell Steiner: Gary Barnett or two scientific officer, can you comment on success? What will be considered success with their client power? And then second, how you how we're thinking about the phase three. The development program that's related to all comers, but also having the subgroup for the older patient. Cheers. So in the Phase II study, I would believe a success really is being able to power and inform the design of the Phase III; that's a success. And success, as far as numerically goes, I think any separation from between the placebo group and the observed tree group would be a success, meaning we can show an observational difference between the power or exerted going up the steps between the two groups.

Samuel Fisch: The development program as it relate to all comers, but also having the subgroup for the older patients.

Gary Barnett: So, so the answer, the first, I'm going to answer a couple of those questions, then I'm going to ask Dr. Gary Barnand or two scientific officers to answer some of those questions. So, as it relates to the database, you absolutely write the database that we have for muscle at an endpoint goes up to three milligrams. Of course, we have a single ascending dose and multiple ascending dose studies that were done in much higher doses of as high as a hundred milligrams.

Gary Barnett: So, in the Phase 2 study, I would believe a success really is being able to power and inform the design of Phase 3. That's a success.

Samuel Fisch: Sure.

Samuel Fisch: So.

Samuel Fisch: T study I would believe that success.

Gary Barnett: And, but I need to remind everybody that we also have done almost 250 patients at nine milligrams or 18 milligrams in our breast cancer program. And some patients have been taking those doses for as high as as long as, you know, two-year plus. So, we do have data for safety above the six milligrams. And, but with that, and then in this patient, and again, we just don't know, no evidence of liver toxicity defined as drug induced liver injury.

Samuel Fisch: With us is being able to power an informed the design of the phase III.

Gary Barnett: And a success, as far as numerically goes, I think any separation between the placebo group and the Anobisarm treaty group would be a success, meaning we can show an observational difference between the power exerted going up the steps between the two groups. I think that would be a success. Remember, we're looking at change from baseline, so we've got a baseline value, and then we have a value at 16 weeks, and then we'll have another value at the end of the extension. And I really think that the definition of success would be that we could observeably see a difference.

Samuel Fisch: And its success as far as numerically does that make any separation.

Samuel Fisch: Between the placebo group.

Samuel Fisch: I mean, those were pretty group would be would would be a success.

Phil: Phil and observational difference between the power exerted going up the steps.

Gary Barnett: I think that would be a success. Remember, we're looking at chains from baseline. So we've got a baseline value, and then we have a value that's 16 weeks, and then we'll have another value at the end of the extension. And I really think that the definition of success would be that we could observationally see a difference. As far as the Phase III trial, what I really think we're going to propose to the FDA, what we're going to try to do, is we're going to power the Phase III study with the overall. Remember, the FDA basically has told us that they believe that weight, excuse me, that muscle loss, or a drug to preserve muscle, or preservedly mass, would be beneficial regardless of age.

Samuel Fisch: I mean, the two groups I think that would be a success, but we're looking at change from baseline. So we've got a baseline value and then we have a value.

Samuel Fisch: Yeah.

Samuel Fisch: 16 weeks and then we'll have another values.

Samuel Fisch: Of the extension.

Samuel Fisch: We really think that the.

Samuel Fisch: We are the definition of success would be that we could observation, we see a difference as far as the phase III trials.

Gary Barnett: As far as the phase 3 trial goes, what I really think we're going to propose to the FDA and what we're going to try to do is we're going to power the phase 3 study with the overall. Remember, the FDA basically has told us that they believe that muscle loss or a drug to preserve muscle or preserve lean mass would be beneficial regardless of age. But they certainly recognize that the most at-risk patients are the aged population we're studying in phase 2.

Samuel Fisch: What I would what I really think we're going to propose to the FDA.

Gary Barnett: As it relates to triglycerides, one of the things that we did, you know, we did see in a different patient population, the older patients, men over the age of 60 and women, the postmenopausal, is we did see about 30% reduction in triglyceride. So, one of the mechanisms where if you worry about, you know, overweight patients or obese patients that may have fatty liver, you know, we may be able to, you know, reduce the triglycerides, which is the source of the fatty liver.

Samuel Fisch: I'll try to do as he was looking to power the phase III study.

Speaker Change: With the overall number the FDA basically told us that they believe the weight or excuse me the muscle loss or a drug to preserve muscle well.

Speaker Change: Presumably your math would be benefits, regardless of their age, but they certainly recognize that the most at risk patients aged population we're studying.

Mitchell Steiner: But they certainly recognize that the most at-risk patients are the aged population, which we're studying the Phase II. So they do want us to include the younger patients in the Phase III study. So I would probably propose at this point that we would have a body weight endpoint. Total body weight endpoint is the primary in the overall population. And then I would power the subgroup, meaning the patients over the age of 60 for sterecon power, because that is the at-risk population. So we intend, obviously, if these patient populations have already lost leading mass, you know, just due to their advancing age, and then we accelerate that with a GRIP-1 or a diet like this, then I think that that's where the value of an OBSARM increasingly mass, increasing physical cancer, is going to be the most important from a patient outcome, and call these wives.

Gary Barnett: So they do want us to include younger patients in the phase 3 study. So I would probably propose at this point that we would have a body weight endpoint; a total body weight endpoint is the primary endpoint in the overall population. And then I would power the subgroup, meaning the patients over the age of 60, for stair climb power because that is the at-risk population. So we intend, obviously, if these patient populations have already lost lean mass just due to their advancing age, and then we accelerate that with a GRIP-1 or a diet like this, then I think that's where the value of an OB-SAR, increasing lean mass, increasing physical function, is going to be the most important from a patient outcome and quality of life.

Speaker Change: So we do want us to include the younger patients.

Speaker Change: In the phase III study, so I wouldn't I would I would probably propose a good corn that we wouldn't have a body weight in point total body weight in point is the primary and the overall population.

Gary Barnett: As it relates to alcohol, I'm going to have to ask Dr. Garry right now what we're doing in a clinical protocol. Yeah, we are not, we're not excluding alcohol. We do monitor the alcohol history and the alcohol intake as we, as we go forward. Of course, we're excluding patients with alcohol associated cirrhosis. We're not excluding the intake of alcohol during the study, but we do monitor that.

Samuel Fisch: I would power the subgroup, meaning the patients over the age of 60.

Samuel Fisch: With four stair climb power.

Speaker Change: Cause that you'd be at risk population. So we intend obviously, a big patient population have already lost lean bass.

Samuel Fisch: Due to the advancing age and then we accelerate that with a.

Samuel Fisch: One or diet like this then I think that.

Speaker Change: That's where the value of the notes are increasingly math, increasing because the country was going to be the most important for them.

Leland Gershell: Thank you very much for the color of the court to the top line results. Great, thank you.

Speaker Change: I'm, a patient outcome and quality of life.

Samuel Fisch: And let me also add, Gary, that the Phase 3 program is going to be done like a typical Phase 3 program. As you know, we're looking at 16 weeks, and the reason we picked 16 weeks for Phase 2 is for two reasons. One is we know about half the total weight that's lost in a trial that goes on for 68 weeks happens in the first 16 weeks. And we also know from bariatric surgery data that in the first three months, 55% of the muscle you lose in that whole year post-surgery happens in the first three months.

Mitchell Steiner: And let me also add, Gary, that the Phase 3 program is going to be done like a typical Phase 3 program. As you know, we're looking at 16 weeks, and the reason we picked 16 weeks for Phase 2 is for two reasons. One is we know about half the total weight that's lost in a trial that goes on for 68 weeks happens in the first 16 weeks. And we also know from bariatric surgery data that in the first three months, 55% of the muscle you lose in that whole year post-surgery happens in the first three months.

Mitchell Steiner: And let me also add, Gary, that the Phase III program is going to be done like a typical Phase III program. As you know, we look at 16 weeks. And the reason we pick 16 weeks to the Phase II is for two reasons. One is we know about half the total weight that's lost in a trial that goes on for 68 weeks. Happens in the first 16 weeks. And we also know from bariatric surgery data that in the first three months, 55% of the muscle you lose in that whole year post-surgery happens in the first three months.

Gary Nachman: And let me also add Gary that the phase III program is gonna be done like a typical phase III program. As you know we were looking at 16 weeks and the reason we picked 16 weeks for phase two is for two reasons. One is we know about half the total weight that's lost in and in a trial that goes on for <unk>.

Mitchell Steiner: So we know there's a lot of activity going on with muscle in that first 16 weeks, and we've got data between Step 1 and now the bariatric surgery data that gives you clarity on what's happening earlier. So the Phase 2 will help us understand what we want to do going forward to the Phase 3. Time for the Phase 3 would be, if we use semaglutide or azepatide and probably use both, the first 16 weeks is what you need to titrate up, and then you go on for another year. So it's been about 68 weeks.

Samuel Fisch: So we know there's a lot of activity going on with muscle in that first 16 weeks, and we've got data between Step 1 and now the bariatric surgery data that gives you clarity on what's happening earlier. So the Phase 2 will help us understand what we want to do going forward to Phase 3. Time for Phase 3 would be, if we use semaglutide or 2-azepatide and probably use both, the first 16 weeks is what you need to titrate up, and then you go on for another year. So it's been about 68 weeks.

Samuel Fisch: Eight weeks happens in the first 16 weeks and so and we also know from Bariatrics surgery data that in the first three months are the <unk>.

Mitchell Steiner: Yeah, so it relates to the phase two and what to expect, so I promise we will announce when we fully enroll the study and so that's probably the last announcement in terms of progress because the last patient out will be December and so the next report will be the actual top line data. As it relates to safety, we're pleased with what we're seeing so far, but we enrolled 150 patients in three months and so many of these patients are just starting their first part of their first month, so we still early times, but again the three milligram dose we've used in five clinical trials and other trials and then we've used nine milligram and 18 milligram, but we're not expecting anything strange but that's why we run the study and that's what we're going to follow and so it's hard to say much more about safety this point except there's no surprises and and then as it relates to we'll be asking another question after that you said as a Yeah, I just wanted to ask a little bit more about some of the secondary appointments in the phase 2v and then how do you expect them to trend and specifically on the HOMA IR?

Speaker Change: 55% of the muscle you lose in that whole year.

Samuel Fisch: Post surgery happens in the first three months. So we know there's a lot of activity going on in muscle and that for 16 weeks and and and we've got.

Mitchell Steiner: So we know there's a lot of activity going on with muscle in that first 16 weeks. And we've got between the step one data and now the bariatric surgery data that gives you clarity on what's happening earlier. So the Phase II will help us, you know, understand what we want to do for the Phase III. Time for the Phase III will be, you know, if we use them a good time, or it's epitide, and probably use both. The first 16 weeks is what you need to time trade up, and then you go on for another year or so it's about 68 weeks.

Samuel Fisch: Between the step one data and now with the bariatric surgery data that gives you clarity on what's happening earlier.

Samuel Fisch: So the phase two will help us.

Samuel Fisch: Sam and we wanted to do going forward with the phase III time for the phase III would be it would be you know if we use them a glue tied or two is appetite and probably use both the first 16 weeks is what you need to titrate up and then you go on for another year or so it's about 68 weeks. So your phase III program would be.

Mitchell Steiner: So your Phase III program will be 68 weeks, and your functional endpoint will be at the end of that 68 weeks. So you have a lot more time to build, maintain muscle, and separate out the placebo group. So the way to look at it as a Phase II is just the beginning, and the one year study will allow you to see the additional fat burning benefits of having a drug that directly reduces fat, but having a clip one receptor acne that says it's not going to have a competing signal where the clip one says stop beating, and the competing signal is going to be the muscle deprivation, deficit telling the brain to eat because that's self-preservation.

Mitchell Steiner: So your Phase 3 program will be 68 weeks, and your functional endpoint will be at the end of that 68 weeks. So you have a lot more time to maintain muscle and separate out the placebo group. And so the way to look at it is that Phase 2 is just the beginning, and the one-year study will allow you to see the additional fat-burning benefits of having a drug that directly reduces fat.

Samuel Fisch: So your Phase 3 program will be 68 weeks, and your functional endpoint will be at the end of that 68 weeks. So you have a lot more time to maintain muscle and separate out the placebo group. And so the way to look at it is that Phase 2 is just the beginning, and the one-year study will allow you to see the additional fat-burning benefits of having a drug that directly reduces fat.

Samuel Fisch: 60 weeks in your functional end point will be at the end of that 68 weeks. So you have a lot more time to build and maintain muscle and separate out the placebo group and so so the way to look at it as a phase two is just the beginning and at the one year study will.

Samuel Fisch: It will allow you to see the additional fat burning benefits of having a drug that directly reduces fat, but having a blip one receptor agonist that can have a competing signal one way to do it.

Samuel Fisch: By having a GLP-1 receptor agonist, it's not going to have a competing signal where the GLP-1 says stop eating, and the competing signal is going to be the muscle deprivation deficit telling the brain to eat because that's self-preservation. If you get rid of that noise, then the GLP-1 can work better.

Mitchell Steiner: By having a GLP-1 receptor agonist, it's not going to have a competing signal where the GLP-1 says stop eating, and the competing signal is going to be the muscle deprivation deficit telling the brain to eat because that's self-preservation. If you get rid of that noise, then the GLP-1 can work better.

Speaker Change: Once you stop eating and competing signal is gonna be the muscle deprivation deficit, telling the brain to eat Chrisette self-preservation, if you get rid of that noise and equip one can work better and finally with more muscle you lose more fat. So that's why we think weight loss as an endpoint in particularly is a good endpoint and in particularly.

Mitchell Steiner: If you get rid of that noise, then the clip one can work better, and finally, with more muscle you lose more fat. So that's why we think weight loss is an endpoint, and particularly is a good endpoint, and particularly now the FDA is thinking about, you know, clinical benefits, not just weight loss; it's weight loss in our case function, and so I think it puts us in a good position. Also, the label will reflect that, because again the FDA doesn't really see muscle loss for cosmetic reasons; they see muscle preservation for functional reasons.

Mitchell Steiner: And finally, with more muscle, you lose more fat. So that's why we think weight loss is an endpoint, and particularly is a good endpoint. And, particularly now, the FDA is thinking about clinical benefits, not just weight loss. It's weight loss and, in our case, function. And so I think it puts us in a good position. And also, the label will reflect that because, again, the FDA doesn't really see muscle loss for cosmetic reasons. They see muscle preservation for functional reasons. Long answer, but hopefully it gave you some clarity. Yeah, that was helpful.

Samuel Fisch: And finally, with more muscle, you lose more fat. So that's why we think weight loss is an endpoint, and particularly is a good endpoint, and, particularly now, the FDA is thinking about clinical benefits, not just weight loss. It's weight loss and, in our case, function, and so I think it puts us in a good position. Also, the label will reflect that, because, again, the FDA doesn't really see muscle loss for cosmetic reasons. They see muscle preservation for functional reasons. A long answer, but hopefully, it gave you some clarity. Yeah, that was very helpful.

Dennis Ding: Yeah, that was helpful. Thank you.

Speaker Change: The F T as I was thinking about you know.

Samuel Fisch: From benefits not just weight loss weight loss.

Samuel Fisch: Our case function and so so I think it puts us in a good position and also the label.

Mitchell Steiner: You will see again lean body mass fat mass which will be the body composition and points will have total weight body weight so we'll see that and then from a functional endpoint we'll be measuring physical function by stericline. The reason that's important is because stericline power, stericline test is a sensitive measure of quadricep strength and and a sensitive to testosterone and antiballic stimulation and it's also a test that the FDH told us in writing is the acceptable function endpoint.

Speaker Change: It will be will reflect that 'cause it because again the FDA doesn't really exist.

Samuel Fisch: C muscle loss for cosmetic reasons, they see muscle preservation.

Operator: Mrs. Long, answer, but hopefully it gave you some clarity. Yes, I was helpful. Thank you. Okay. Thank you.

Samuel Fisch: For functional reasons.

Samuel Fisch: Long answer, but hopefully that gave you some clarity.

Speaker Change: Yeah that was helpful. Thank you.

Speaker Change: Okay. Thank.

Speaker Change: Thank you.

Mitchell Steiner: Ladies and gentlemen, this concludes the question in the next session.

Operator: Ladies and gentlemen, this concludes the question and answer session. I would like to turn the comments back over to Dr. Mitchell Steiner for any closing remarks.

Speaker Change: Ladies and gentlemen. This concludes the question and answer session I would like to turn the conference back over to Dr. Mitchell Steiner for any closing remarks.

Mitchell Steiner: I would like to turn the comments back over to Dr. Mitchell Steiner for any closing remarks. Thank you, operator. I appreciate everyone who joined us on today's call. I look forward to updating all of you on our progress at our next investor's call. Thank you again. Bye now. Thank you.

Mitchell Steiner: Thank you, operator. I appreciate everyone who joined us on today's call. I look forward to updating all of you on our progress at our next investor call. Thank you again. Bye now. A digital replay of the conference call will be available beginning approximately noon eastern time today, August. Bye, darling.

Speaker Change: Thank you operator, I appreciate everyone, who joined US on today's call I look forward to updating all of you on our progress at our next investors call. Thank you again bye now.

Operator: Thank you. The digital replay of the conference call will be available beginning at approximately noon Eastern Time today, August 8th, by dialing 1-877-344-7529 in the U.S. and 1-412-317-0088 internationally. You will be prompted to enter the replay access code, which will be 256-1276. Please record your name and company when joining. The conference call has now concluded. Thank you for attending today's discussion.

Operator: To do to replay the conference call, we'll be available beginning approximately noon Eastern Time today, August 8th, by dialing 1-877-344-7529 in the U.S. And 1-412-317-0088 internationally. You'll be prompted to enter the replay access code, which will be 256-1276.

Operator: The digital replay of the conference call will be available beginning approximately noon eastern time today, August 8th, by dialing 1-877-344-8888 or 529 in the U.S.

Dave: Thank you. So just a replay of the conference call will be available beginning approximately noon eastern time today August Dave.

Mitchell Steiner: Depends for a moment as you know there many as you may have heard like grip strength and leg press and chest press. The FDH told us those are not acceptable functional endpoints so the functional endpoint that we we've chosen in the study, stericline power is you know is accepted by FDA in fact a talo pharma with the F had the musco dystrophy drug approved and it gets about six months ago. And so the so I think that's that's key.

Operator: Please record your name and company when joining. This conference call has now concluded. Thank you for attending today's discussion.

Speaker Change: 18773, or four 475 to nine in the U S and one for 123170.

Speaker Change: 088 internationally.

Speaker Change: Prompted to enter the replay access code, which will be 2561 to seven six.

Operator: This is your recorded name and company when joining.

Operator: [inaudible]

Operator: Please record your name and company when joining.

Operator: The conference call has now concluded. Thank you for attending today's discussion. Thank you.

Operator: Conference call has now concluded thank you for attending today's discussion.

Mitchell Steiner: The other thing it's key in those five clinical studies that we did in almost 968 patients, about 900 of those patients we did stericline. So we know how to do stericline, it was learned a lot and how to execute on that endpoint.

Operator: Yeah.

Operator: [music].

Gary Barnett: Dr. Barnett do you want to add to anything? to that. Yeah, that's exactly right. And we're looking for changes in lean mass. We're looking for maintenance of lean mass in our treaty group versus a loss in lean mass in the placebo group. And we're looking to assess how much fat we can, how much we can augment the fat loss. That's the main focus of this study. Thanks for that color, guys. Thank you.

Operator: [music]

Operator: Okay.

Operator: [music].

Gary Nachman: And that next question, Constan William, what would be Riley's securities? Appreciate it for taking my questions and congratulations on a quarter. Just looking for a little extra color here on what we might expect in January for the top line data. Is this going to be like simply lean mass loss being reported or will you provide any extra details on the body weight loss and or the fat loss war, specifically the functional improvements?

Gary Nachman: Yeah, great question. So the question because you were a little garbled, but I think the basic question that I heard is that when you report in January, what can we expect in terms of top line data and the kinds of top line data that we'll get? And the answer is for sure. I say this way because because the lot depends on our concern that if you report too much information, then all of a sudden now, you know, you can't get all these all these societies and stuff don't want you don't want you to.

Gary Nachman: I mean, you have to have a scientific meeting with new information. So with that said, the most important thing about the trial is reporting out on body composition. So certainly the primary endpoint of lean body mass and total fat mass. So you have a clear understanding of our dose response or the right dose to pick for the right preservation of muscle and reduction of fat compared to placebo. So we'll have that for sure.

Gary Nachman: And then we'll just we'll you know, I just have to see how how the societies and additional scientific meetings and that kind of stuff. What we can report. But as you know, in the spring time and the winter time, there are a lot of meetings that we'll be going on.

Gary Nachman: So so if it's not right in the top line data happening in January, it'd be shortly thereafter, one of the major meetings. Very helpful.

Gary Nachman: And maybe actually just a question. I believe you mentioned that you're going to have a presentation at obesity week. You mentioned the abstract. Is this going to be I would say unseen data from past clinical trials or is it going to be a little bit of what we've been seeing. Or potentially what we've seen already. It'll be it'll be additional data you have not seen. It's another analysis looking at data. So it's not repeat data that we've already shown. So it'll be you'll be new data from the old studies. Okay, helpful.

Operator: That's it. I'll jump back and see you. Thanks so much. Thank you. Appreciate it. Thank you. And again, if you'd like to ask a question, please press star of the one to drive your question press star of the zoo.

Dennis Ding: And the next question comes from Dennis Ding with Jeffries. Hi, this is Antia on for Dennis. Thanks for taking for our questions.

Dennis Ding: Two from us on stair climb power, could you talk a little bit about what the MCID is for the measure and what would be a successful outcome in phase two. And on the phase three, you've spoken previously about moving forward in elderly patients only versus on the broader obesity population. Can you just let us know your thinking there and how the phase two informed that decision. Thank you. Great. So I'm going to take the second question first.

Dennis Ding: And then the Dr. Barnand will talk about stair climb power in terms of what's deemed a success. So in terms of the study, so so to be very clear, the FDA has told us that in the phase three program that they're looking forward to us having the opportunity to develop a drug in all patients that have obesity or overweight. So in other words, all commerce and and their belief is that a muscle preservation drug will have benefit in an older, has benefit, older patients will have benefit in younger patients too.

Dennis Ding: And so so that's a positive sign that the FDA is you know well aware of body composition and how they're thinking about it. The FDA also said that one way forward would be to look for incremental weight loss. And now I'm talking about phase three programs now, incremental weight loss. It would be combination versus the versus the clip one alone. The incremental weight loss, the FDA did not commit to how much weight loss incremental weight loss.

Dennis Ding: You should you should demonstrate because their position is that because you have a muscle preservation drug, they may benefit in other ways, such as physical function, home on R is scary. Nockman brought up. There are other things, other benefits of having a muscle preservation drug that's beyond just the adding muscle or preserving muscle just for sake of doing it. So showing function is important. And so in a phase three program having those end points, it's key secondary end points and primary end point weight loss allows the FDA to look at the one point was a direct cut off on weight and that was it.

Dennis Ding: But now it's much more much more mortality data. So so so so what will inform us in this study. The phase two is not whether we're going to go after an older patient population. This study is meant to ask the question in an informative patient population, meaning doesn't it make sense that if you want to show a benefit in physical function, you pick patients that already have muscle loss and may already have functional limitations.

Dennis Ding: And if you treat them with an antibiotic agent, selective antibiotic agent like an ovus arm, that you show a benefit in physical function. So so you're going to more likely show that an older patient population, which by the way in the 950 some odd patients, we've done five clinical studies. They were older patients. So we have experienced with older patients and older patients with at least certainly with the three milligram dose.

Dennis Ding: The totality of the day shows that we hit function. So so so that would make sense. As you start thinking about a phase three program. Again, the totality of the whole approach would be to go to for our comers. And so Gary, if you don't mind, can you comment on success? Gary Barnett or two scientific officer, can you comment on success? What will be considered success with their client power? And then second, how you how we're thinking about the phase three.

Dennis Ding: The development program that's related to all comers, but also having the subgroup for the older patient. Cheers. So in the Phase II study, I would believe a success really is being able to power and inform the design of the Phase III, that's a success. And success as far as numerically goes, I think any separation from between the placebo group and the observed tree group would be a success, meaning we can show an observational difference between the power or exerted going up the steps between the two groups.

Dennis Ding: I think that would be a success. Remember, we're looking at chains from baseline. So we've got a baseline value, and then we have a value that's 16 weeks, and then we'll have another value at the end of the extension. And I really think that the definition of success would be that we could observationally see a difference. As far as the Phase III trial, what I really think we're going to propose to the FDA, what we're going to try to do, is we're going to power the Phase III study with the overall.

Dennis Ding: Remember, the FDA basically has told us that they believe that weight, excuse me, that muscle loss, or a drug to preserve muscle, or preservedly mass, would be beneficial regardless of age. But they certainly recognize that the most at-risk patients are the aged population which we're studying the Phase II. So they do want us to include the younger patients in the Phase III study. So I would probably propose at this point that we would have a body weight end point.

Dennis Ding: Total body weight end point is the primary in the overall population. And then I would power the subgroup, meaning the patients over the age of 60 for sterecon power, because that is the at-risk population. So we intend, obviously, if these patient populations have already lost leading mass, you know, just due to their advancing age, and then we accelerate that with a GRIP-1 or a diet like this, then I think that that's where the value of an OBSARM increasingly mass, increasing physical cancer, is going to be the most important from a patient outcome, and call these wives.

Dennis Ding: And let me also add, Gary, that the Phase III program is going to be done like a typical Phase III program. As you know, we look at 16 weeks. And the reason we pick 16 weeks to the Phase II is for two reasons. One is we know about half the total weight that's lost in a trial that goes on for 68 weeks. Happens in the first 16 weeks. And we also know from bariatric surgery data that in the first three months, the 55% of the muscle you lose in that whole year post-surgery happens in the first three months.

Dennis Ding: So we know there's a lot of activity going on with muscle in that first 16 weeks. And we've got between the step one data and now the bariatric surgery data that gives you clarity on what's happening earlier. So the Phase II will help us, you know, understand what we want to do for the Phase III. Time for the Phase III will be, you know, if we use them a good time, or it's epitide, and probably use both, the first 16 weeks is what you need to time trade up, and then you go on for another year or so it's about 68 weeks.

Dennis Ding: So your Phase III program will be 68 weeks, and your functional endpoint will be at the end of that 68 weeks. So you have a lot more time to build, maintain muscle and separate out the placebo group. So the way to look at it as a Phase II is just the beginning, and the one year study will allow you to see the additional fat burning benefits of having a drug that directly reduces fat, but having a clip one receptor acne that says it's not going to have a competing signal where the clip one says stop beating, and the competing signal is going to be the muscle deprivation, deficit telling the brain to eat because that's self-preservation.

Dennis Ding: If you get rid of that noise, then the clip one can work better, and finally with more muscle you lose more fat. So that's why we think weight loss is an endpoint, and particularly is a good endpoint, and particularly now the FDA is thinking about, you know, clinical benefits, not just weight loss, it's weight loss in our case function, and so I think it puts us in a good position. Also the label will reflect that, because again the FDA doesn't really see muscle loss for cosmetic reasons, they see muscle preservation for functional reasons.

Mitchell Steiner: Mrs. Long answer, but hopefully it gave you some clarity. Yes, I was helpful. Thank you. Okay. Thank you.

Operator: Ladies and gentlemen, this concludes the question in the next session.

Operator: To do to replay the conference call, we'll be available beginning approximately noon Eastern time today, August 8th, by dialing 1-877-344-7529 in the U.S. And 1-412-317-0088 internationally. You'll be prompted to enter the replay access code, which will be 256-1276. This is your recorded name and company when joining.

Operator: The conference call has now concluded. Thank you for attending today's discussion.

Operator: Thank you.

Q3 2024 Veru Inc Earnings Call

Request a DemoDemo

VERU

Veru

Earnings