Q4 2024 Rhythm Pharmaceuticals Inc Earnings Call

After the Speakers' presentation, there'll be a question and answer session and instructions will be given at that time.

As a reminder, this call maybe recorded.

Speaker Change: I would now like to turn the call over to David Connolly IR and corporate Communications. Please go ahead.

David Connolly: Thank you Michele on the economy here at rhythm Pharmaceuticals for those of you participating on the conference call. Our slides can be accessed and controlled by going to the investors section of our website IR dot rhythm TX dot com.

David Connolly: This morning, we issued our press release that provide for 2024 and full year 2024 financial results and business update in that press release is available on our website.

David Connolly:

Speaker Change: Our agenda is listed on slide two on the call today are David Meeker, Our chairman and Chief Executive Officer, and President Jennifer Li Executive Vice President and head of North America Hunter Smith, Chief Financial Officer, and John <unk> Executive Vice President.

Speaker Change: Head of international is underlying joining us from Europe.

Speaker Change: On slide three I'll remind you that this call contains remarks concerning future expectations plans and prospects, which constitute forward looking statements actual results may differ materially from those indicated by these forward looking statements as a result of various important factors, including those discussed in our most recent Andy.

Speaker Change: Annual or quarterly reports on file with the SEC. In addition, any forward looking statements represent our views of today and should not be relied upon as representing our views as of any subsequent dates we specifically disclaim any obligation to update such statements with that I'll turn the call over to David Meeker, who will begin on slide five.

David Meeker: Thank you Dave Good morning, everybody. Thank you for joining.

David Meeker: So we pre announced strong fourth quarter earnings in advance of the J P. M Conference. We are entering 2025, well capitalized have been recently raised $75 million in gross proceeds from our ATM program, which extends our cash runway into 2027 through multiple inflection points and we have completed enrollment in our phase II daily oral <unk>.

<unk> study.

David Meeker: We feel incredibly positive about how the opportunity in genetically driven impairments to the emcee for our pathway signaling is involved is evolving as we have highlighted many times ultra rare disease opportunities like Bbs, where there is a significant unmet medical need a high percentage of undiagnosed patients and where the availability of a precision therapy can accelerate.

David Meeker: The number of patients getting to a diagnosis. These opportunities we will continue to grow at a steady pace for a decade or longer the U S opportunity is taking shape and we will continue to expand internationally, we could build a business around the Bbs opportunity alone.

David Meeker: We are excited about the progress we are making with our next generation compounds <unk> Milligan, a once daily oral pill and the weekly sub Q injection RMB 701 eight.

David Meeker: Our goal with the next generation opportunities not just to extend patent Mike but to actually make a better drug both products have robust clinically robust activity in preclinical models and have no cardiovascular activity in the appropriate models. Both our emcee one are sparing no hyper pigmentation and significantly more convenient.

David Meeker: Whether there is an opportunity to improve on the efficacy remains to be seen the Beaver Milligan phase II study is fully enrolled this quarter and we will readout in the third quarter and a 718 program is beginning to enroll this quarter.

David Meeker: So on slide seven the now familiar design slide for a phase III trial of <unk> in Atlanta tight and acquired <unk> and we continue to receive the majority of our questions here what is the timing of the readout and what is the expected percent change in BMI.

David Meeker: Guidance for the trial reading out in the first half and we cannot be more specific that it will be this will be a second quarter readout.

David Meeker: Our updates remain consistent with what we have said our dropout rate remains below 10%, which I think that'll be strong metric patients are rolling over into the open label extension. They do remain blinded to the original assignment and only one patient has not rolled over and because that patient wanted to start a family.

David Meeker: With regard to the percent change in BMI. It is a blinded phase III clinical trial, we have however, reminding people that the current fervor around percent change comes out of the many trials being run in in general obesity space with some version of a G. L. P. One these trials have similar designs. So comparisons can be made across trials. Although this.

David Meeker: As always imperfect when we look at <unk> <unk> and <unk>. It is an apples and oranges comparison. The biology is fundamentally different we are replacing a deficit in the hormone alpha melanocyte stimulating hormone. The GOP. One approach is to provide pharmacologic doses on top of intact physiology.

David Meeker: The trial enrolled four year old patients and 60 year old patients and we measure the same endpoints the percent change in BMI at 52 weeks.

David Meeker: In our phase II trial, the youngest patients aged six lost approximately 35% of their BMI of 16 weeks, whereas the oldest patient 24 years old last.

David Meeker: 14% now with the 24 year old patient actually lost more weight, but on a percent basis. It was a smaller change. So these are variables, which will impact the final numbers that said all of our data to date the phase II study, which was predominantly pediatric patients and the French preapproval early access data, which was all adults.

David Meeker: Suggests we will do well on the primary.

David Meeker: Secondaries, we'll break out the pediatric and adult patients. So the full story can be clearly understood. The Japanese cohort of 12 patients for which we recently completed enrollment will readout independently from the pivotal cohort. So there is no impact on timing of top line data and subsequent regulatory filings in the United States in Europe, We expect the Japanese cohort will readout in the first half.

David Meeker: Six if successful these data will enable us to seek marketing authorization in Japan, where there is a higher prevalence of certain brain tumors and hyperplastic obesity than in the U S or Europe.

David Meeker: A reminder, on slide eight that the opportunity in HR is significant and we continue to learn more we affirm our original estimates, which we believe we are appropriately conservative the populations reflected on the slides with five to 10000 patients in the U S. In a similar range in Europe, and five to 8000 patients in Japan represent a pool of patients who may be largely diagnosing.

David Meeker: In the endocrinology specialty call point, there is an additional pool of patients with injury to the hypothalamus, where the diagnosis is not so clear and they are likely to remain undiagnosed. We look forward to expanding our understanding of this patient population.

David Meeker: Now the path to building the future of rhythm is clear we have opportunities to further explore genetically driven impairment named <unk> pathway. The M&A trials enrolled and will readout in the first half of 2026 genes coming out of the DAYBREAK trial, which was a little more work can also be targeted <unk> Willi syndrome is a challenging disease, but there is a sound biologic.

David Meeker: Rationale as to why an emcee for our agonists can work in that disease. This quarter. We have initiated as you know a new 26 week open label Phase II trial to evaluate <unk> Willi syndrome, we plan to enroll up to 20 patients 6% to 65 years old in the signal finding study and patients will be dose escalated to five milligrams, a day, which is significantly higher.

David Meeker: Then the dose we used in the first attempt at Prater Willy and there'll be dose escalated to that five milligrams is tolerated. So we are conducting this trial in a single use site under an investigator with deep experience in <unk> Willi syndrome, and we look forward to updating you on that progress.

David Meeker: The other pillar, which is emerging as an incredibly exciting opportunity is that related to injury to the hypothalamus or failure of the hypothalamus to develop we are focused on tumors and their associated treatment, which may lead to injury, but there are clearly many more ways. The hypothalamus may be injured, leaving the patient with acquired H O. We look forward to learning more about <unk> activity in patients with.

David Meeker: Developmental abnormalities related to congenital syndromes involving this area of the brain and we are on track to enroll the first patients with congenital H O and an independent and 39 patients 34 week sub study in the first quarter of 2025.

David Meeker: Finally, we anticipate doing much if not all of the supplemental indication expansion work with one or both of our next generation compounds with patent lines, which extend past 2040, we have completed enrollment in the phase II <unk> trial and acquired H O. This quarter and we anticipate the data readout to be in the second half of 2025.

David Meeker: So we will begin enrolling patients with acquired H O and part C of the phase one trial of RMB 718, this quarter and are aiming for a data read out before the end of the year.

David Meeker: So in summary, 2024 was a year of execution in 2025 is a year of readouts, which could prove to be transformative for rhythm. In addition to some critical trial initiations.

Jennifer: I will now turn the call over to Jennifer.

Jennifer: Thank you David.

David Meeker: Yes.

Speaker Change: 24 hours it sounds like Youre from February sales in the U S with consistent growth throughout the year over the years, we have fine tuned our process to find patients get them through an accurate diagnosis and ensure access to therapy.

Speaker Change: Once on therapy, we work with patients and their health care providers to support maintenance contact Dee.

Speaker Change: More than two years and from the lines. The system. We have put in place is working and will also help feed your potential launch it.

Speaker Change: New prescriptions received in the fourth quarter were consistent quarter over quarter.

Speaker Change: We're seeing continued success and approval, then reauthorization and our tailored support to patients and families are enabling patients to receive the long term benefit of maintaining on therapy.

Speaker Change: Within the fourth quarter the increase in the number of patients on reimbursed therapy was attributable to a number of incrementally positive trends that when combined added up to a strong growth.

Speaker Change: For example, in addition to the steady level of approvals for reimbursement from scripts received we saw fewer discontinuation from patients who are on reimbursed therapy.

Speaker Change: Several switches from our free drug program to reimburse therapy, and some later stage appeal wins during the quarter.

Speaker Change: Well no. It's a quarterly metrics each of these categories stand out as a significant change on their own when taken together it resulted in a strong quarter.

Speaker Change: Turning to slide 12.

Speaker Change: In December the FDA approved a label expansion for MS. Deborah Aitken Creek children as young as two years of age with obesity ditch Bbs or palm CPC SK, one our leopard deficiency. This approval sends a strong message that helps us differentiate there will cause an impact of these rare empty for a pathway diseases.

Speaker Change: With this insatiable hunger most patients develop early onset obesity before the age of five <unk>.

Speaker Change: <unk> left untreated may lead to severe and long term health complications intervention at the young age can be critical and treating obesity early can lead to better health outcomes.

Speaker Change: We're excited about with this label expansion means for patients like them and their families.

Speaker Change: Then with diagnosis finally, like leopard deficiency. When he was two years old and up until then you have seen by approximately 20 different doctors.

Speaker Change: His mother outlines then was constantly crying for food, even when he added snacking at hand.

Speaker Change: Even though the Doctor did not know it she knew something was not right.

Speaker Change: Then enrolled in our phase III pediatric trial, when he was three and a half years old and has BMI went from $36 eight to 30.

Speaker Change: Ben who is now on commercial therapy and his entire family have more freedom now that their lives did not resolve around food. This story is one example of an <unk>, making a positive impact on a young child and his family.

Speaker Change: Moving to slide 13.

Speaker Change: Our teams are preparing for a positive outcome in our phase III trial in acquired Hepatology obesity.

Speaker Change: And then next to catch all lines market research to gain insights for physicians payers and patients and families is ongoing we're actively engaging with patient advocacy groups and our teams are executing physician engagement efforts in 2025, we look forward to sharing more details with you as we progress with potential.

Jan: D submission in months now I will turn the call over to Jan.

Yeah.

Jan: Thank you Jennifer.

Speaker Change: We are pleased with the growth in the international region for the fourth quarter of 2024 and for the year of 2024.

Speaker Change: We have achieved access slimsy read more than 15 countries outside the U S for patients with <unk>, <unk> Bbs and <unk>.

Speaker Change: Reimburse nexis on inefficiencies.

Speaker Change: Germany with the Bbs launch no well established and friends.

Speaker Change: Paid early access programs for <unk>, Bbs and <unk> remain the main drivers for the region.

Speaker Change: In Germany, Bbs launch is steady and minerals is a consistent growth pattern of the U S.

Speaker Change: And we continue to expand and then they often do 20 Bbs patients.

Speaker Change: <unk> is also contributing with both the pre EUA approval.

Speaker Change: Hold on for a true anticipated early access programs for CD 70 bps.

Speaker Change: For you to receive positive feedback from the physicians treating patients insurance until these programs specifically patients with ICR.

Speaker Change: <unk> continued to hypothalamic obesity are responding with Sydney.

Speaker Change: Also I can see with the marketing authorization for pediatric patients are related to reimbursement for patients as young as two years old in many countries, including UK, Spain and Italy.

Speaker Change: Today, we announced a new strategic partnership in Turkey, where there is a significant unmet need.

Speaker Change: Please announce rates for rare diseases in general and <unk> in our case agreed to the rest of Europe, providing us an incremental opportunity.

Speaker Change: Now is there a pharma solutions.

Speaker Change: And then <unk> any well known to US we began working with him as a consistency of sugar.

Speaker Change: And recently formalized.

Speaker Change: Partnership to Spiro as deep experience and relationship with rare disease community and <unk> and centers of excellence in Turkey.

Speaker Change: That's business leased in Japan, we are beginning to build out operation in anticipation of <unk> Nikko beauty.

Speaker Change: There's a significant unmet need and the prevailing spot capital greater than in the U S.

Speaker Change: Europe, Japan represents a major opportunity for reason.

Speaker Change: Overall 2024.

Speaker Change: A foundational year in expanding access to EMC re across the international region met with NTT hasn't amongst scientific and medical expert clinicians and patient advocacy groups and recognized in Q as a precision medicine for 15 rare neuroendocrine diseases.

John: Thank you John.

Speaker Change: Before getting into Q4 and year end financial results I want to start with our balance sheet beginning on slide 17.

For the amount of 2024 were $326 million in cash and cash equivalents.

Speaker Change: We raised gross proceeds of 75 million through the sale of approximately one 3 million shares of common stock at a weighted average price of $56 30.

Speaker Change: Under our aftermarket or ATM equity offering program during the fourth quarter of 2024 and continuing into January of 2025.

Speaker Change: The $320 6 million of cash on hand includes about $40 million of gross proceeds raised in Q4, but not the additional gross proceeds of $35 billion raised in January.

We expect this level of cash should be sufficient to fund planned operations into 2027, well past several meaningful milestones and data readouts, including the pivotal phase III data readout and acquired hypothalamic obesity as well as the data readouts for both the phase II trial of different Nelligan, and <unk> and the phase one part C study of our 718 and Joe We also anticipate data from the.

Speaker Change: Single site single site, <unk> Willi trial as well as data from the phase III emanate trial within this timeframe.

Speaker Change: Let's now review the snapshot of the Q4 and full year P&L on slide 18.

Speaker Change: You pre announced preliminary unaudited revenue from global sales of Sebree in January reporting that net revenue from global sales of <unk> came in at $41 8 million in Q4, and $130 1 million for the full year 2024, as compared to $24 2 million and $77 4 million for the fourth quarter and full year 2023.

Speaker Change: Gross to net in the U S remained consistent at about 85% for both the third and fourth quarters of 2020 for cost of sales during the fourth quarter was $3 8 million or approximately 9% of net product revenue versus 11, 5% of net product revenue in the third quarter of 2004, a 13, 4% of fourth quarter of 2023.

Speaker Change: Cogs as a percentage of revenues decreased in part due to capitalized costs associated with higher inventory produced versus products sold in the quarter. The largest component of Cogs remains the 5% royalty on subsidiary, which we pay to ipsen.

Speaker Change: R&D expenses were $41 2 million for the fourth quarter compared to $29 9 million in the fourth quarter of 2023.

Speaker Change: Sequentially quarter over quarter, we experienced 9% to 9% increase in R&D expenses due to increased costs associated with the ongoing trials with a a mulligan and arm 718, and the new phase III <unk> trial, and product really which began this quarter the year over year increase was primarily due to acquisition costs related to <unk>.

Speaker Change: SG&A expenses were $38 1 million for the fourth quarter of 24 as compared to $32 4 million for the fourth quarter of 2003.

Speaker Change: Sequentially SG&A expenses increased by almost 8% compared to Q3, primarily driven by increased head count and marketing costs.

Speaker Change: For the fourth quarter of 2020 for weighted average common shares outstanding were $61 6 million almost $61 million for the full year of 2024.

Speaker Change: Cash used in operations was approximately $19 million in Q4 and has averaged approximately $28 $5 million in the last four quarters.

Let's now review the snapshot of the Q4 and full year P&L on slide 18.

You pre announced preliminary unaudited revenue from global sales of subsidiary in January reporting that net revenue from global sales of <unk> came in at $41 8 million in Q4 and $131 million for the full year 2024, as compared to $24 2 million and $77 4 million for the fourth quarter and full year 2023.

Speaker Change: Fourth quarter operating expenses included.

Speaker Change: Total stock based compensation of $10 6 million for the quarter compared to $11 million in the prior quarter.

Speaker Change: Reported GAAP EPS for the fourth quarter was a net loss per basic and diluted share of <unk> 72.

Speaker Change: And this includes <unk> <unk> per share from accrued dividends on convertible preferred stock of $1 3 million. As a reminder, this ongoing accrual will be $1 3 million per quarter.

Gross to net in the U S remained consistent at about 85% for both the third and fourth quarters of 2020 for cost of sales during the fourth quarter was $3 8 million or approximately 9% of net product revenue versus 11, 5% of net product revenue in the third quarter of 2004, and 13, 4% in fourth quarter of 2023.

Some highlights from the quarter and the year are broken out on slide 19.

Speaker Change: As mentioned Q4 revenue from global sales of <unk> was $41 8 million U S revenue in the fourth quarter was $31 7 million of that accounting for 76% or percent of revenue during the quarter.

As a percentage of revenues decreased in part due to capitalized costs associated with higher inventory produced versus product sold in the quarter. The largest component of Cogs remains the 5% royalty on <unk>, which we pay to ipsen.

Speaker Change: For the year U S sales accounted for 74% of revenue.

Speaker Change: As we detailed in January the significant sequential quarter over quarter revenue growth of greater than $8 million was evenly split by an increase in the number of U S patients on reimbursed therapy, which Jennifer spoke to an increased inventory stocking during the fourth quarter by our specialty pharmacy, such inventory moves are not unusual in the fourth quarter of the calendar year.

R&D expenses were $41 2 million for the fourth quarter compared to $29 9 million in the fourth quarter of 2023.

Sequentially quarter over quarter, we experienced 9% to 9% increase in R&D expenses due to increased costs associated with the ongoing trials with <unk> and RMB 718 in the new phase III <unk> trial in <unk>, Willi, which began this quarter the year over year increase was primarily due to acquisition costs related to <unk>.

Speaker Change: Our U S GAAP opex.

Speaker Change: For 2024 totaled $382 $3 million and that included $39 7 million in stock based compensation as well as $92 $4 million in consideration for the acquisition of the global rights to develop <unk> gone from LG Chem.

SG&A expenses were $38 1 million for the fourth quarter of 24 as compared to $32 4 million for the fourth quarter of 'twenty three.

Speaker Change: For the year non-GAAP Opex came in at $250 2 million, which is at the low end of our $250 million to $270 million guidance range.

Sequentially SG&A expenses increased by almost 8% compared to Q3, primarily driven by increased head count and marketing costs.

Speaker Change: Consistent with years past, we are not giving revenue guidance, but we are offering guidance on non-GAAP operating expenses.

For the fourth quarter of 2020 for weighted average common shares outstanding were $61 6 million almost $61 million for the full year of 2024.

Speaker Change: For 2025, we anticipate approximately $285 to $315 million and non-GAAP Opex comprised of non-GAAP SG&A expenses of $135 million to $145 million and non-GAAP R&D expenses of $150 million to $170 million.

Cash used in operations was approximately $19 million in Q4 and has averaged approximately $28 5 million in the last four quarters.

Fourth quarter operating expenses included.

Speaker Change: The overall increase in expected non-GAAP Opex for 2025 years due to anticipated increases in SG&A as we grow our organization in preparation for launching in February for the treatment of hypothalamic obesity in the United States and subsequently in Europe and Japan.

Total stock based compensation of $10 6 million for the quarter compared to 11 million in the prior quarter.

Reported GAAP EPS for the fourth quarter was a net loss per basic and diluted share of <unk> 72.

And this includes <unk> <unk> per share from accrued dividends on convertible preferred stock of $1 3 million.

Speaker Change: Increased R&D spending is anticipated due to ongoing trials and development of the Milligan and RMB 718, NHL setting Atlanta tied in the new product really trial and expansion of our medical affairs programs.

As a reminder, this ongoing accrual will be $1 3 million per quarter.

Some highlights from the quarter and the year are broken out on slide 19.

Speaker Change: We believe this increased level of investment in our business will drive long term growth and shareholder value.

As mentioned Q4 revenue from global sales of <unk> was $41 8 million U S revenue in the fourth quarter was $31 7 million of that accounting for 76% or percent of revenue during the quarter.

Speaker Change: One final point, we will pay $40 million in cash to LG Chem in July 2025. This is the second and final tranche of the license fee for BPM Eligon. This payment is included in our cash out guidance, but not our 2025 opex guidance as this amount was recognized as R&D expense in 2024.

For the year U S sales accounted for 74% of revenue.

As we detailed in January the sequential quarter over quarter revenue growth of greater than $8 million was evenly split by an increase in the number of U S patients on reimbursed therapy, which Jennifer spoke to an increased inventory stocking during the fourth quarter by our specialty pharmacy, such inventory moves are not unusual in the fourth quarter of the calendar year.

Speaker Change: I'll hand, the call back over to David. Thank you. Thanks, Henry So hopefully what you've heard us rhythms and a really good place we're established commercially and we're growing.

Speaker Change: Got exciting developmental programs, which all potentially open up significant opportunities for us and we've significantly strengthened our balance sheet, putting us in a really strong position to execute on whats in front of us. So we feel good about where we are with that we'll open it up to Q&A.

Our U S GAAP opex.

Jennifer: For 2024 totaled $382 3 million and that included $39 7 million in stock based compensation as well as $92 $4 million in consideration for the acquisition of the global rights to build different Milligan from LG Chem.

Speaker Change: Thank you if you'd like to ask a question. Please press star one one.

Speaker Change: Your question has been answered and you'd like to remove yourself from the queue. Please press star one again.

For the year non-GAAP Opex came in at $250 2 million, which is at the low end of our $250 million to $270 million guidance range.

Speaker Change: Our first question comes from Derek <unk> with Wells Fargo. Your line is open.

Consistent with years past, we are not giving revenue guidance, but we are offering guidance on non-GAAP operating expenses.

Derek: Hey, good morning, and congrats on the progress just two questions from US just first could you comment on whether youre going to share the sad Mad portion of the RM seven study separately or will that kind of be wrapped into the second half 'twenty five update with part C. And then just on <unk> phase III trial in <unk> I was wondering if you could just remind us the mix of adult <unk>.

Jennifer: For 2025, we anticipate approximately $285 million to $315 million and non-GAAP Opex comprised of non-GAAP SG&A expenses of 135 to 145 million and non-GAAP R&D expenses of $150 million to $170 million.

The overall increase in expected non-GAAP Opex for 2025 is due to anticipated increases in SG&A as we grow our organization in preparation for launching <unk> for the treatment of hypothalamic obesity in the United States and subsequently in Europe and Japan.

Derek: Afric patients you expect ultimately will the split be the same in the Japanese cohort. Thanks.

Derek: Yes, so for the sad Mad piece of it I think it is likely we will.

Derek: Have specific plans to present that as an independent breakout. So you are right, we will probably do that in concert with the.

Increased R&D spending is anticipated due to ongoing trials and development of the Milligan and RMB 718 in H O seven Atlanta tied in the new product really trial and expansion of our medical affairs programs.

Derek: Part C of that trial.

Derek: But what I will say about that is it's a little bit of a no news in <unk> opportunities.

Jennifer: We believe this increased level of investment in our business will drive long term growth and shareholder value.

Derek: As long as Youre progressing you can assume that things are going well there so.

Derek: We feel good about where we are with the data that's coming out so far in 718.

Jennifer: One final point, we will pay $40 million in cash to LG Chem in July 2025. This is the second and final tranche of the license fee for Bedlam Eligon. This payment is included in our cash out guidance, but not our 2025 opex guidance as this amount was recognized as R&D expense in 2024.

Derek: For phase III, the <unk> split we did not.

Derek: The regulators wanted more adults in the trial. So we were very focused on that and <unk> got multiple additional adult centers.

Derek: To participate we're about 50 50, but like I said, we did not.

David: With that I'll hand, the call back over to David Thank you.

David: Thanks, Henry So hopefully what you've heard is rhythms and a really good place. We're established commercially and we're growing got exciting developmental programs, which all potentially open up significant opportunities for us in <unk>.

Derek: Cap the number of peds or adults to lock the number that would be exactly the same but the split is going to be roughly even 50%.

Speaker Change: Significantly strengthen our balance sheet, putting us in a really strong position to execute on whats in front of us. So we feel good about where we are with that we'll open it up to Q&A.

Speaker Change: Next question.

Speaker Change: Thank you. Our next question comes from Seamus Fernandez with Guggenheim Securities. Your line is open.

Jennifer: Thank you if you'd like to ask a question. Please press star one one.

Speaker Change: Alright, thanks, so much for the question so.

Speaker Change: David.

Jennifer: If your question has been answered and you'd like to remove yourself from the queue. Please press star one again.

Speaker Change: Emphasizing a lot the market opportunity in <unk>.

Speaker Change: Joe.

Speaker Change: Being quite firm at the sort of 5000 to 10000 patient range.

Derek: Our first question comes from Derek <unk> with Wells Fargo. Your line is open hey, good.

Speaker Change: Interested to get a sense of with success.

Derek <unk>: Good morning, and congrats on the progress just two questions from us and just first could you comment on whether youre going to share the sad Mad portion of the RMB 718 study separately or will that kind of be wrapped into the second half of 'twenty five update with part C. And then just on <unk> phase III trial in <unk> I was wondering if you could just remind us the mix of adult and pediatric.

Speaker Change: How you would see uptake.

Speaker Change: In that population just more identifiable.

Speaker Change: The Bbs patient population or perhaps even the genetic population so interested to just get a better understanding there and then as we've spoken with some thought leaders in this space.

Derek: Patients you expect ultimately will the split be the same in the Japanese cohort. Thanks.

Speaker Change: There is a little bit of a discussion around sort of the preexisting obesity set point.

Derek: Yes, so for the sad Mad piece of it I think it is likely we will we don't have specific plans to present that as an independent breakout. So you are right, we will probably do that in concert with the.

Speaker Change: As a potential contributor because of the.

Speaker Change: The.

Speaker Change: The hormone replacement dynamics.

Speaker Change: Treatment with Atlanta tide, just interested to know.

Derek: Part C of that trial.

Speaker Change: If you feel like that could have an impact on the phase III <unk> trial results in.

Derek: But what I will say about that is it's a little bit of no news for sad Mad opportunities.

Derek: As long as Youre progressing you can assume that things are going well there. So we're feel good about where we are with the data that's coming out so far in <unk>.

Speaker Change: Any direction given the mix of patients that you just talked about in the phase III study.

Speaker Change: Sorry I.

Speaker Change: I didn't quite understand the second question, there, so youre, saying that the variations in endocrine replacement impacted.

Derek: For phase III, the HOS <unk> split we did not.

Derek: The regulators wanted more adults in the trial. So we were very focused on that and we've got multiple.

Speaker Change: Their outcomes more of that.

Speaker Change: There was a pre existing at that point prior to the injury.

Derek: Additional adult centers.

Speaker Change: Oh.

Derek: To participate.

Speaker Change: It could sort of limit the magnitude of benefit depending on the timing of that injury.

Derek: About 50, 50, but like I said, we did not.

Derek: Cap the number of peds or adults to lock the number that would be exactly the same but the split is going to be roughly even 50%.

Speaker Change: Yeah, Let me let me take that question first I mean, that's a really interesting question.

Speaker Change: I think the way again, we're learning right when we entered into H O nothing really work nobody really understood. What the underlying biology was and then we have this result, where essentially every patient who took the drugs small number of patients.

Derek: Next question.

Speaker Change: Thank you. Our next question comes from Seamus Fernandez with Guggenheim Securities. Your line is open.

Speaker Change: Took an <unk> agonist had a response, which suggests that the problem in <unk> is in fact signaling through this mine according for pathway.

Speaker Change: Alright, thanks, so much for the question so.

Derek: David.

Derek: We're emphasizing a lot the market opportunity.

Speaker Change: And what I highlighted in my prepared remarks was.

Derek: Joe.

Joe: Being quite firm at the sort of 5000 to 10000 patient range.

Speaker Change: One major difference between the <unk> and ourselves as well.

Speaker Change: We're replacing a deficit so in a sense in theory restoring normal physiology.

Joe: Interested to get a sense of.

Derek: With success.

Speaker Change: We have examples of that which is.

Derek <unk>: How you would see uptake.

Speaker Change: Our lean mass, particularly in teenage boys, where you'd expect them to be gaining muscle mass they did.

Derek <unk>: In that population just more identifiable.

Derek <unk>: Then the Bbs patient population or perhaps even the genetic population so interested to just get a better understanding there and then as we've spoken with some thought leaders in this space.

Speaker Change: They gained well and so I think there is some.

Speaker Change: Support for the idea that we're going to restore your normal physiology and then you are who you are so back to your question of if you were obese prior to getting your tumor and developing your installed in theory, we could get you back to where you were before but our drug is not a drug for general obesity, so that under.

Derek <unk>: There is a little bit of a discussion around sort of the preexisting obesity set point.

Derek <unk>: As a potential contributor because of the.

Derek <unk>: The.

Derek <unk>: The hormone replacement dynamics.

Derek <unk>: Treatment with San Atlanta side, just interested to know.

Speaker Change: Buying deficit or your underlying normal physiology arent likely to be impacted so I think that is true.

Derek <unk>: No.

Derek <unk>: If you feel like that could have an impact on the phase III <unk> trial results in <unk>.

Speaker Change: And I think what we've talked about internally and with experts and the like is our hope and we have some anecdotal evidence of this is we'd like to get you back to where you were before year injury, I think thats, a very reasonable expectation and that would be a huge restoration of help.

Derek <unk>: Any direction given the mix of patients that you just talked about in the phase III study.

Derek <unk>: Sorry, I didn't quite understand the second question, there, so youre, saying that the variations in endocrine replacement impacted there.

Speaker Change: So hopefully that answered the question.

Derek <unk>: Their outcomes.

Speaker Change: Yes.

Derek <unk>: More of that that there was a preexisting set point prior to the injury.

Speaker Change: Okay and then on the.

Speaker Change: Uptake cited this yes, we're not guiding you and also I mean as Jennifer said, we're early here, we're learning along with all of you as we do our own research and the like what we can say is this is fundamentally different in Bbs, meaning so yes, we expect a different uptake than we saw with Bbs something these patients as we've highlighted are we.

Derek <unk>: <unk>.

Derek <unk>: It could sort of limit the magnitude of benefit depending on the timing of that injury.

Derek <unk>: Yeah, Let me let me take that question first I mean, that's a really interesting question.

Derek <unk>: I think the way you know again, we're learning right. When we entered into H O nothing really work nobody really understood. What the underlying biology was and then we have this result, where essentially every patient who took the drugs small number of patients.

Speaker Change: No concentrated in <unk> and colony Powerpoint the reason, they're concentrated in the endocrinology Powerpoint is because the vast majority 80% to 85% of these patients have pituitary insufficiency and they need to be managed by an endocrinologist to make sure that that aspect of their health is being appropriately managed and Thats also especially where they recognize this entity. So.

Derek <unk>: Took an <unk> agonist had a response, which suggests that the problem in <unk> is in fact signaling through this mine accordant four pathway.

Derek <unk>: And what I highlighted in my prepared remarks was.

Derek <unk>: One major difference between the <unk> and ourselves as well.

Speaker Change: Concentrated larger number of patients higher percent diagnosis all of that will lead to a faster uptick now that said counterbalancing that which is always true.

Derek <unk>: We're replacing a deficit so in a sense in theory restoring normal physiology.

Derek <unk>: We have examples of that which is.

Speaker Change: This is and you write a script and you go to your local pharmacy, so it's not going to launch like some drugs do.

Derek <unk>: Our lean mass, particularly in teenage boys, where you'd expect them to be gaining.

Speaker Change: We will have prior authorization will still have to go through the reimbursement challenges that we have.

Speaker Change: <unk> they did.

Derek <unk>: They gained well and so I think there is some.

Speaker Change: We're not changing the price so it's still going to be priced at a level where.

Derek <unk>: Support for the idea that we're going to restore your normal physiology and then you are who you are so back to your question of if you were obese prior to getting your tumor.

Speaker Change: Payers are going to be looking at it carefully.

Speaker Change: We've been encouraged by the feedback from payers initially and so we expect that to go well, but those are balancing factors that would cause us to be a little bit different from maybe a more easily accessible specialty opportunity.

Derek <unk>: And in developing your insult in theory, we could get you back to where you were before but our drug is not a drug for general obesity, so that underlying deficit or your underlying normal physiology arent likely to be impacted so I think that is true.

Speaker Change: Great. Thanks, so much.

Speaker Change: Thank you.

Speaker Change: Our next question comes from Phil Nadeau with TD Cowen Your line is open.

Derek <unk>: And I think what we've talked about internally and with experts and the like is our hope and we have some anecdotal evidence of this is we'd like to get you back to where you were before year injury, I think thats, a very reasonable expectation and that would be a huge restoration of health.

Phil Nadeau: Good morning, Thanks for taking my questions two from us as well.

Diving into the <unk> pivotal data a bit more deeply in your prepared remarks, you said you expect <unk> to do well on the primary endpoint I'm sorry. The question, we're going to get from investors is what does management think well is I guess in the spectrum of 5% weight loss, which is the regulatory hurdle to 25, 25% BMI.

Derek <unk>: So hopefully that answered the question.

Derek <unk>: Yes.

Derek <unk>: Okay and then on the.

Speaker Change: Uptake cited this yes, we're not guiding it also Jennifer said, we're early here, we're learning along with all of you as we do our own research and the like what we can say is this is fundamentally different than Bbs.

Phil Nadeau: <unk>, which is what you saw in the.

Phil Nadeau: The long term extension kind of were in that and that spectrum as well.

Speaker Change: Meaning so yes, we expect a different uptake than we saw with Bbs. Some these patients as we've highlighted our.

Phil Nadeau: A question and then second one for Hunter in terms of Q1 trends just trying to assemble all the data points you gave us it sounds like there was $4 million of inventory build in Q4 is that likely to be destock in Q1 and therefore.

Speaker Change: We know concentrated in and call. It a powerpoint the reason they're concentrated in the endocrinology Powerpoint is because the vast majority 80% to 85% of these patients have pituitary insufficiency and they need to be managed by an endocrinologist to make sure that that aspect of their health is being appropriately managed and Thats also especially where they recognize this entity.

Phil Nadeau: As a modestly down quarter over quarter possible or is that can be absorbed in the channel and putting out more slowly.

Phil Nadeau: So I'll take the second question first.

Phil Nadeau: And I would say, yes, we absolutely anticipate.

Speaker Change: Concentrated larger number of patients higher percent diagnosis all of that will lead to a faster uptake now that said counterbalancing that which is always true.

Phil Nadeau: The destocking to occur in this quarter.

Phil Nadeau: So.

Speaker Change: You know how it is Phil Q1 for all our companies like us, especially when you have a single specialty pharmacy can always be a little wonky.

Speaker Change: This is and you write a script and you go to your local pharmacy, so it's not going to launch like some drugs do well.

Speaker Change: We will have prior authorization will still have to go through the reimbursement challenges that we have.

Phil Nadeau: Got it thank you.

Speaker Change: Yes, Bill so.

Speaker Change: We're not changing the price so it's still going to be priced at a level where.

Speaker Change: Question, what does management think a percent change I mean, the reason and as I highlighted we have had this question in a sense endlessly and it's understandable and I tried to highlight that I think it's coming to a large extent out of the how we've all been conditioned by the <unk> World. In this world is fundamentally different and tried to give you. Some examples as to why.

Speaker Change: Payers are going to be looking at it carefully.

Speaker Change: We've been encouraged by the feedback from payers initially and so we expect that to go well, but those are balancing factors that would cause us to be a little bit different from maybe a more easily accessible specialty opportunity.

Speaker Change: Alright, thanks, so much.

Speaker Change: Those comparisons are challenging so that said what do we know we know that in the small number of patients in phase II and then.

Speaker Change: Thank you.

Speaker Change: Our next question comes from Phil Nadeau with TD Cowen. Your line is open good morning.

Speaker Change: This early experience in France and France.

Speaker Change: Thanks for taking my questions two from us as well.

Speaker Change: Essentially everybody has taken the drug has responded well.

Phil Nadeau: Diving into the <unk> pivotal data a bit more deeply in your prepared remarks, you said you expect Atlanta to do well on the primary endpoint I'm sure. The question, we're going to get from investors is what does management think well is I guess in the spectrum.

Speaker Change: And we know that the average numbers of 20% of us at.

At one year and for both of those groups.

Speaker Change: We also know that we have patients.

Speaker Change: Who I gave you. The example of the 24 year olds with 16 weeks right. He lost more subsequently, but at 16 weeks had loss less on a percent basis in a very light a much lighter individual who launch a larger percentage of his BMI, but a smaller overall absolute amount. So those are just variables that are really hard to predict we have a larger <unk>.

Phil Nadeau: 5% weight loss, which is the regulatory hurdle to 25, 25% BMI reduction, which is what you saw in the <unk>.

Phil Nadeau: The long term extension kind of where in that in that spectrum is.

Phil Nadeau: Well that's the first question and then second one for Hunter in terms of Q1 trends just trying to assemble other data points you gave us it sounds like there was $4 million of inventory build in Q4 is that likely to be destock in Q1 and therefore.

Speaker Change: <unk> in this trial now I have no fear in the adults have looked like they respond well I think that was an incredibly powerful part coming out of each one. So this long answer to your question is I mean, what we've said is 5% of the regulatory hurdle, we'd be incredibly disappointed to less than 10% feel incredibly good about I know this drug works.

Phil Nadeau: As a modestly down quarter over quarter possible or is that can be absorbed in the channel and putting out more slowly.

Phil Nadeau: So I'll take the second question first.

Speaker Change: The ability to project what percent change.

Phil Nadeau: And I would say, yes, we absolutely anticipate.

We're likely to see becomes much more difficult beyond that.

Phil Nadeau: The destocking to occur in this quarter.

Phil Nadeau: So.

Speaker Change: Thank you. Our next question comes from Whitney item with Canaccord Genuity. Your line is open.

Speaker Change: You know how it is Phil I mean Q1 for all companies like us, especially when you have a single specialty pharmacy can always be a little lumpy.

Speaker Change: Hey, guys. Thanks for taking the question I just wanted to follow up on Seamus. This question around prevalence in HL and I guess some of the commentary earlier on the call.

Phil Nadeau: Got it thank you.

Phil Nadeau: Yeah and bill so.

Speaker Change: Around the prevalence numbers that have been quoted I think largely being based on cranial scans jamar data.

Phil Nadeau: Question, what does management think a percent change I mean, the reason and as I highlighted we have had this question in a sense endlessly and it's understandable and I tried to highlight that I think it's coming to a large extent out of the how we've all been conditioned by the <unk> World. In this world is fundamentally different and tried to give you. Some examples as to why.

Speaker Change: Is there any work that I mean, I know there's work. So can you speak to any of the work ongoing.

Speaker Change: In terms of the prevalent that may come from other etiologies, including debt and genital form.

Speaker Change: So.

Phil Nadeau: Those comparisons are challenging so that said what do we know we know that in small number of patients in phase II and then.

Speaker Change: It's a work in progress.

Speaker Change: We are hearing increased confidence around those numbers that we put out because this work is supporting the fact that we're at least that good we believe.

Phil Nadeau: This early experience in France and France.

Speaker Change: Early things, which we can highlight I will say that or.

Essentially everybody has taken the drug has responded well.

Speaker Change: Or aspects of that initial modeling we're looking at.

Phil Nadeau: And we know that the average numbers of 20% plus at one year and for both of those groups.

Speaker Change: We.

Speaker Change: Entered with the assumption that cranial fringe yamal was going to be the majority of cases, that's not.

Phil Nadeau: We also know that we have patients.

Speaker Change: Necessarily true Theres, clearly many more tumors, which are contributing significantly to this population and so that's coming out of some of this early claims work, which we'll see where that takes the ultimate numbers.

Phil Nadeau: Who I gave you. The example of the 24 year olds at 16 weeks right. He lost more subsequently, but at 16 weeks had loss less on a percent basis in a very light a much lighter individual who launched a larger percentage of his BMI, but a smaller overall absolute amount. So those are just variables that are really hard to predict we have a larger.

Speaker Change: The other thing was we.

Speaker Change: Did our initial calculation.

Speaker Change: A 20 year period post injury, we know these patients live longer so.

Phil Nadeau: Number of adults in this trial now I have no fear in the adults have looked like they respond well I think that was incredibly powerful part coming out of Asia. So this long answer to your question is I mean, what we've said is 5% of the regulatory hurdle, we'd be incredibly disappointed to less than 10% feel incredibly good about I know this drug works.

Speaker Change: So if you have your tumor at age 15 them.

Speaker Change: Die at 35.

Speaker Change: Deliver a much longer life.

Speaker Change: So.

Speaker Change: And then seeing that the adults respond well also I think there is that part of the model. We may have been conservative on so those are things, we'll continue to look at and we will come out and update these numbers as we get more competence there and the last thing I will say, which I again highlighted briefly in the prepared remarks was.

Phil Nadeau: The ability to project what percent change.

Phil Nadeau: We're likely to see becomes much more difficult on that.

Speaker Change: We're measuring what we can see what the system can see theres clearly an undiagnosed pool here and talked about injury in.

Speaker Change: Thank you. Our next question comes from Whitney <unk> with Canaccord Genuity. Your line is open.

Speaker Change: Hey, guys. Thanks for taking the question.

Speaker Change: It's still wait I mean, Thats, a case report world today, and it's way too early to say, maybe it's not nothing more than a case report, but I am quite confident that if you have a head injury and you suddenly start gaining weight. Nobody is thinking you have acquired hypothalamic obesity. So that's a population that is likely undiagnosed today.

Speaker Change: Just wanted to follow up on <unk> question around the private lines in HL and I guess some of the commentary earlier on the call.

Speaker Change: Around the prevalence numbers that have been quoted I think largely being based on cranial scans jamar data.

Speaker Change: Is there any work that I mean, I know there's work. So can you speak to any of the work ongoing.

Speaker Change: In terms of the prevalent that may come from other etiologies, including debt and genital form.

Speaker Change: <unk>.

Speaker Change: That's helpful. Thanks.

Speaker Change: Okay.

Speaker Change: Thank you. Our next question comes from <unk> Ahmad with Bank of America. Your line is open.

Speaker Change: So it's.

It's a work in progress.

Speaker Change: Youre hearing increased confidence around those numbers that we put out because this work is supporting the fact that we're at least that good we believe.

Speaker Change: Hi, Good morning, Thanks for taking my questions, David I wanted to ask a little bit more detail about what you said about your thoughts about not really.

Speaker Change: Early things, which we can highlight I will say that or.

Speaker Change: Or aspects of that initial modeling we're looking at.

Speaker Change: Being able to project what results Youll get other than knowing that this is an active drug in that it works over time, but what if doctors told you about what they'd like to see in terms of percent weight loss in order for them to want to be using it right away in HL patients and then my second is more of a financial one you completed your ATM.

Speaker Change: We.

Speaker Change: Entered with the assumption that cranial fringe yamal was going to be the majority of cases.

Speaker Change: Necessarily true Theres, clearly many more tumors, which are contributing significantly to this population and so that's coming out of some of this early claims work, which we'll see where that takes the ultimate numbers.

Speaker Change: This <unk>.

Speaker Change: H O dataset readout coming up very soon.

Speaker Change: The other thing was we.

Speaker Change: Did our initial calculation.

Speaker Change: Would you rule out doing a cash raise after that dataset read that assuming that it's positive.

Speaker Change: A 20 year period post injury, we know these patients live longer so.

Speaker Change: Yes.

Speaker Change: So if you have your tumor at age 15.

Speaker Change: Thanks, Andre can answer that question of course, but.

Speaker Change: Die at 35 to.

Speaker Change: To be honest, we're not asking the doctors.

Speaker Change: To live a much longer life.

Speaker Change: Very direct question would you use it if we had a 12% or not use it if it was 12 when you would use it if it was 15% or 18%.

Speaker Change: So.

Speaker Change: And then seeing that the adults respond well also.

Speaker Change: I think there is that part of the model. We may have been conservative on so those are things, we'll continue to look at and we will come out and update these numbers as we get more confidence there and the last thing I will say, which I again highlighted briefly in the prepared remarks was.

Speaker Change: What the doctors are telling US is nothing in general works in this now we all know Theres case reports out there and small series with <unk> ones and we've quoted I've quoted what some of the doctors have said that about 20% of the eight of HL patients will have some response to a <unk> one in that response tends to be less than 10%. So.

Speaker Change: We're measuring what we can see what the system can see theres clearly an undiagnosed pool here and talked about injury in.

Speaker Change: It's still wait I mean, Thats, a case report world today, and it's way too early to say, maybe it's not nothing more than a case report, but I am quite confident that if you have a head injury and you suddenly start gaining weight. Nobody is thinking you have acquired hypothalamic obesity. So that's a population that is likely undiagnosed today.

Speaker Change: I think where the doctors are certainly the doctors who are knowledgeable and actively understand this problem in following them is if this is approved label and indicated for this indication and is anything like our experience to date it will be an amazing differ.

Speaker Change: The difference for these patients today in terms of what they're experiencing experiencing so I <unk>.

Speaker Change: <unk>.

Speaker Change: That's helpful. Thanks.

Speaker Change: Just can't give adenoidal projecting.

Speaker Change: Okay.

Speaker Change: Projecting a percent outcome in our clinical trials of course.

Speaker Change: Thank you. Our next question comes from <unk> Ahmad with Bank of America. Your line is open.

Speaker Change: Mhm credibly difficult, but I really think it's the wrong question that I think it is not with the majority of doctors who are treating these patients are focused on and they want to know if theres a work consistently and does it worked better than what they've had in the past.

Speaker Change: Hi, Good morning, Thanks for taking my questions, David I wanted to ask a little bit more detail about what you said about your thoughts about not really.

Speaker Change: And to your second question and thank you very much for the question.

Speaker Change: Being able to project.

Speaker Change: Results Youll get other than knowing that this is an active drug in that it works over time, but when a doctor has told you about what they'd like to see in terms of percent weight loss in order for them to want to be using it right away in HL patients and then my second is more of a financial one you completed your ATM, but you do have this <unk>.

Speaker Change: First of all.

Speaker Change: I'm sure you are hearing and I want to reiterate that we are very very high confidence in this data readout, that's coming up.

Speaker Change: And we're at the same time, given the uncertainty of the broader market conditions as well as the.

Speaker Change: Our data is that readout coming up very soon.

Speaker Change: The vagaries of market reactions to data, we thought it prudent to take.

Would you rule out doing a cash raise after that dataset reads out assuming that it's positive.

Speaker Change: To extend the runway to a period, where we didn't absolutely have to do a raise following the data and we're now in that position and we're very happy to be here and we think its benefits.

Speaker Change: Yes.

Speaker Change: Thanks Kristina.

Speaker Change: And answer that question of course, but.

Speaker Change: To be honest, we're not asking the doctors.

Speaker Change: Our overall operational flexibility.

Speaker Change: Very direct question would you use it if we had a 12% or not use it if it was 12 and you would use it if it was 15% or 18%.

Speaker Change: Our investment program for the coming years is generally associated with <unk>, Milligan and RMB 718 and indication expansion.

Speaker Change: What the doctors are telling US is nothing in general works in this now we all know Theres case reports out there and small series with <unk> ones and quoted I've quoted what some of the doctors have said that about 20% of the eight of HL patients will have some response to a <unk> one in that response tends to be less than 10%. So.

Speaker Change: So the need to invest more and the need to raise more will be driven largely by success in those programs.

Speaker Change: Which is exciting.

Speaker Change: And so we're not in a position today, where we would say no we're done raising money or anything like that.

Speaker Change: Having said that we want to be in a position, which we are in where we don't have to do a raise following the data readout.

I think where the doctors are certainly the doctors who are knowledgeable and actively understand this problem in following them is if this is approved labels and indicated for this indication and is anything like our experience to date it will be an amazing differ.

Speaker Change: Thank you.

Speaker Change: Next question comes from Joseph Stringer with Needham <unk> Company. Your line is open.

Speaker Change: The difference for these patients today in terms of what they're experiencing experiencing so I.

Joseph Stringer: Hi, good morning, Thanks for taking our question.

Joseph Stringer: On the phase III <unk> trial, the inclusion criteria has slightly different age groups compared to the open label phase two or phase III.

Speaker Change: Just can't give adenoidal projecting.

Speaker Change: Projecting a percent outcome in our clinical trials of course.

Speaker Change: Mhm credibly difficult, but I really think it's the wrong question that I think it's not with the majority of doctors who are treating these patients are focused on and they want to know it is a work consistently and does it worked better than what they've had in the past.

Joseph Stringer: Putting 4% to six year olds, and then also patients older than 40. So can you describe what impact the inclusion of each of these groups of patients could have on the phase III BMI primary endpoint, both in terms of magnitude of effect and overall data variability.

Speaker Change: And to your second question and thank you very much for the question.

Speaker Change: First of all.

Speaker Change: I'm sure you are hearing and I want to reiterate that we are very very high confidence in this data readout, that's coming up.

Joseph Stringer: Thanks.

Speaker Change: Yes nothing.

Speaker Change: None and Ken and I say that cautiously meaning that.

Speaker Change: And we're at the same time, given the uncertainty of the broader market conditions as well as the.

Speaker Change: We had patients down to six I think the difference between four and six is negligible I think the four year old will do as well as the six year old.

Speaker Change: The vagaries of market reactions to data, we thought it prudent to take.

Speaker Change: The French data was incredibly helpful.

Speaker Change: To extend the runway to a period, where we didn't absolutely have to do a raise following the data and we're now in that position and we're very happy to be here and we think its benefits.

Speaker Change: These were in the eight adult patients we reported out at tossed they had.

Speaker Change: If you remember they had a mean age of 30, so somewhere significantly older than 30 and on average they were 11 years out from their installed so that provided strong support for this concept that it isn't a problem that only works. If you can get it in in the first one to two years post injury, it really looks like.

Speaker Change: Our overall operational flexibility.

Speaker Change: Our investment program for the coming years is generally associated with <unk>, Milligan and RMB 718 and indication expansion.

Speaker Change: So the need to invest more and the need to raise more will be driven largely by success in those programs.

Speaker Change: Does it matter how far out you are once you've entered your hypothalamus you are living with impaired signaling to the emcee for argue or living with it.

Speaker Change: And if we can intervene with an <unk> agonist and we've got a good chance of helping those people. So I don't think either end of the spectrum is going to have any impact on on how we're going to do one other thing I'm just going to offer up because I know.

Speaker Change: Which is exciting.

Speaker Change: And so we're not in a position today, where we would say no we're done raising money or anything like that.

Speaker Change: Having said that we want to be in a position, which we are in where we don't have to do a raise following the data readout.

Speaker Change: People are appropriately focused on sort of what could the percent change be.

Speaker Change: Another thing to remember is in that phase II trial, the patient who did leased well at 16 weeks meeting they had about a 4% decrease in their BMI that was the only patients who took the drug who did not lose 10% or more was on track to lose 10% or more by 2016 weeks that patient when you looked like they were the least good.

Thank you.

Speaker Change: Next question comes from Joseph Stringer with Needham <unk> Company. Your line is open.

Joseph Stringer: Hi, good morning, Thanks for taking our question.

Joseph Stringer: On the phase three <unk> trial, the inclusion criteria has slightly different age groups compared to the open label phase two or phase III.

Speaker Change: Responded when you look at the indexes scan they had like a 20 plus percent increase in their lean body mass and a 15% decrease in their fat mass. So from a health response standpoint, arguably that was one of our best responders. So again back to this idea that we're replacing a deficit restoring more normal physiology and allowing.

Joseph Stringer: Putting 4% to six year olds, and then also patients older than 40. So can you describe what impact the inclusion of each of these groups of patients could have on the phase III BMI primary endpoint, both in terms of magnitude of effect and overall data variability.

Speaker Change: Youtube do what you should do so teenage boys should put on lean muscle mass.

Joseph Stringer: Thanks.

Joseph Stringer: Yes, no. Thanks.

Speaker Change: Other groups will behave differently.

Ken: None and Ken and I would say it had crashes.

Joseph Stringer: Cautiously meaning that.

Joseph Stringer: We had patients down to six I think the difference between four and six is negligible I think the four year old will do as well as the six year old.

Speaker Change: That helps.

Speaker Change: Thanks.

Speaker Change: Okay.

Speaker Change: Our next question comes from Leland <unk> with Oppenheimer. Your line is open.

Joseph Stringer: The French data was incredibly helpful.

Joseph Stringer: We're in the eight adult patients we reported out at tossed they had.

Speaker Change: Hey, good morning, Thanks for the update.

Speaker Change: We have two questions first.

Joseph Stringer: If you remember they had a mean age of 30, so somewhere significantly older than 30 and on average they were 11 years out from their installed so that provided strong support for this concept that it isn't a problem that only works. If you can get it in in the first one to two years post injury. It really looks like it does.

Speaker Change: Just wanted to ask early days, but same for label expansion.

Speaker Change: Just want to.

Speaker Change: To what extent expansion enhancing lesions seen in younger ages is becoming a component of that.

Speaker Change: Commercial uptake and then also wanted to ask as you look to enroll patients with congenital <unk>.

Joseph Stringer: <unk> matter how far out you are once you've entered your hypothalamus you are living with impaired signaling to the emcee for argue or living with it.

Speaker Change: It will be with us.

Speaker Change: Similarly, you can fill them frequently those patients are identified.

Speaker Change: This is our other historical.

And if we can intervene with an <unk> agonist and we've got a good chance of helping those people. So I don't think either end of the spectrum is going to have any impact on how we're going to do one other thing I'm just going to offer up because I know.

Speaker Change: In general J Ferrar disproportion. Thanks.

Speaker Change: Yes, let me take the second person that Jennifer can comment on that and the $2 six year old opportunity.

Speaker Change: So.

Speaker Change: We're learning about the general H O.

Joseph Stringer: People are appropriately focused on sort of what could the percent change be.

Opportunity and again this was brought to us by a doctor's work following large populations here and what they observed is.

Joseph Stringer: Another thing to remember is in that phase II trial, the patient who did leased well at 16 weeks meeting they had about a 4% decrease in their BMI that was the only patients who took the drug who do not lose 10% or more was on track to lose 10% or more by 2016 weeks that patient when you looked like they were the least good.

Speaker Change: Patients with this area of the brain that developing appropriately and there is a variety of different syndromes quote unquote, depending on how they present.

Speaker Change: But it's clear that there is some percentage of these patients who have obesity.

Speaker Change: In the very early data in France suggests that some of those patients respond.

Joseph Stringer: Responded when you look at the indexes scan they had like a 20 plus percent increase in their lean body mass and a 15% decrease in their fat mass. So from a health response standpoint, arguably that was one of our best responders. So again back to this idea that we're replacing a deficit restoring more normal physiology and allowing.

Speaker Change: Two NMC for our agonist, so our challenge and the literature just is not very helpful. Here, yet understanding the percent of patients with one of these congenital syndrome, who have obesity and then one step further which is that that obesity is related to hypothermia impairment and I think the challenge here is unlike in.

Joseph Stringer: Youtube, which you should do so teenage boys should put on lean muscle mass.

Speaker Change: Injury, setting where you have it before and after these of course are congenital they start at birth and they emerge over time Theyre pituitary insufficiencies emerge over time, it's not like they are born with a full bond picture. So as obesity might emerge you can imagine that a doctor looking at that patient wouldn't necessarily connected.

Joseph Stringer: Other groups will behave differently.

Joseph Stringer: That helps.

Joseph Stringer: Thanks.

Joseph Stringer: Thanks.

Speaker Change: Our next question comes from Leland <unk> with Oppenheimer. Your line is open.

Speaker Change: General syndrome, and <unk> related.

Joseph Stringer: Hey, good morning, Thanks for the update.

Speaker Change: In today's world, it's equally likely they just thinking have obesity on top so that's our challenge I think we're going to learn a lot over the next year.

Joseph Stringer: We have two questions first.

Joseph Stringer: Just wanted to ask early days, but since the label expansion.

Joseph Stringer: <unk>.

Speaker Change: So theres a lot of enthusiasm around this as we talked to physicians again, it's a little bit like H O. Yes, I have these patients and yes, I would love to have something to do for them. So very early as you said.

Joseph Stringer: To what extent expansion enhancing lesions seen in younger ages is becoming a component of that.

Joseph Stringer: Commercial uptake and then also want to ask as you look to enroll patients with congenital <unk>.

Joseph Stringer: It will be with us.

Speaker Change: And the point about the.

Joseph Stringer: Similarly, you can fill them frequently those patients are identified.

Speaker Change: The potential opportunity for the pediatric expansion.

Joseph Stringer: Are there historical.

Speaker Change: In general J Ferrar disproportion. Thanks.

Speaker Change: One I would say that in Q4 really indication.

Speaker Change: Yes, let me take the second person that Jennifer can comment on that and the $2 six year old opportunity.

Speaker Change: Quite late in the year. So it didn't have an act in terms of.

Speaker Change: So.

Speaker Change: We're learning about the general H O.

Speaker Change: The outline of the revenue that we.

Speaker Change: Opportunity and again this was brought to us by a doctor's work following large populations here and what they observed is.

Speaker Change: We released.

Speaker Change: Moving forward, we are very happy to have this as an option for patients to our two plus years of age and as I outlined.

Speaker Change: Patients with this area of the brain that developing appropriately and theres a variety of different syndromes quote unquote, depending on how they present.

Speaker Change: Ms Joanne <unk> background at the impact can be significant for these patients.

Speaker Change: But it's clear that there is some percentage of these patients who have obesity.

Speaker Change: However, we don't feel like it's going to be a significant market opportunity.

Speaker Change: In the very early data in France suggests that some of those patients respond.

Speaker Change: This significant increase or impact on revenue.

Speaker Change: Two NMC for our agonist, so our challenge and the literature just is not very helpful. Here, yet understanding the percent of patients with one of these congenital syndrome, who have obesity and then one step further which is that that obesity is related to hyperkalemia impairment and I think the challenge here is unlike in.

Speaker Change: We are more happy.

Speaker Change: This is an additional piece of information that really further differentiates our patient population in terms of the need.

Speaker Change: Got it.

Speaker Change: As shown by the ability to actually get approval for two year olds bus.

Speaker Change: Injury, setting where you have it before and after these of course are congenital they started at birth and they emerge over time Theyre pituitary insufficiencies emerge over time, it's not like they are born with a full blown pictures. So as obesity might emerge you can imagine that a doctor looking at that patient wouldn't necessarily connected.

Speaker Change: So that consistency and differentiation of our patient population is different is what we're really focused on moving forward.

Speaker Change: Alright, thank you.

Speaker Change: Next question.

Speaker Change: Thank you. Our next question comes from Dennis <unk> with Jefferies. Your line is open.

Speaker Change: General syndrome, and <unk> related.

Speaker Change: Good morning. This is <unk> on for David. Thank you for taking my questions two from us on the upcoming Phase III trial could you talk a little bit about click one use that baseline is robbins are allowed throughout the trial and how you anticipate that to.

Speaker Change: In today's world, it's equally likely they just thinking have obesity on top so that's our challenge I think we're going to learn a lot over the next year.

Speaker Change: So theres a lot of enthusiasm around this as we talked to physicians again, it's a little bit like H O. Yes, I have these patients and yes, I would love to have something to do for them. So very early as you said.

Speaker Change: Efficacy.

Speaker Change: And then on the business to.

Speaker Change: <unk> do you see any read throughs from this trial in terms of efficacy is on enrollment and the adult pediatric vik. Thank you very much.

Speaker Change: And the point about the <unk>.

Speaker Change: The potential opportunity for the pediatric expansion.

Speaker Change: Sorry, which phase II trial.

Speaker Change: Oh for <unk>.

Speaker Change: One I would say that in Q4 really indications.

Speaker Change: Read through in term.

Speaker Change: What's the question about the debit trial.

Quite late in the year. So it didn't have an act in terms of.

Speaker Change: Do you see any read throughs from the southern Atlantic High trial in terms of efficacy and then also in terms of an NDA.

Speaker Change: The outline of the revenue that way.

Speaker Change: And then released.

Speaker Change: In the adult pediatric thanks.

Speaker Change: Moving forward, we are very happy to have this as an option for patients to our two plus years of age and as I outlined.

Speaker Change: Yes.

Speaker Change: So that's a 28 patients four arms of seven patients per arm blinded trial. So no.

Speaker Change: Honestly no insight into the efficacy at this point, we didnt restricted it's 12 and older.

Speaker Change: Jeremy Thanks, Joanne Ben's backgrounds at the impact can be significant for these patients.

Speaker Change: So I'd say a slightly older population, we need to we're still developing the pediatric formulation for <unk>, which we're making great progress on and will that will be part of our next trial, but we don't have that part of the population. So that's all I can say now about the mix of patients worth of inventory.

Speaker Change: However, we don't feel like it's going to be a significant market opportunity.

Speaker Change: Yes.

Speaker Change: It can increase or impact on revenue.

Speaker Change: We are more happy to have this as an additional piece of information that really further differentiates our patient population in terms of the need.

Speaker Change: With regard to glimpse and the.

Speaker Change: <unk> phase III trial, so about 25% of the patients had previously been on a glib <unk>, we're continuing a glib if they continue to clip they could not have had weight loss of 2% or greater.

Speaker Change: At UBS.

Speaker Change: As shown by the ability to actually get approval for <unk> plus.

Speaker Change: So that consistency and differentiation of our patient population and its differences, but we're really focused on moving forward.

Speaker Change: In the prior three months and so.

Speaker Change: You have to be stable on it and you cannot add a new weight loss medication during the trial and that didn't happen, but that was excluded by protocol.

Speaker Change: Alright, thank you.

Speaker Change: Next question.

Speaker Change: Thank you. Our next question comes from Dennis Deng with Jefferies. Your line is open.

Speaker Change: Got it thank you.

Speaker Change: Okay.

Speaker Change: Thank you. Our next question comes from Rob <unk> with HC Wainwright <unk> Company. Your line is open.

Speaker Change: Good morning. This is <unk> on for David. Thank you for taking my questions two from us on the upcoming Phase III trial could you talk a little bit about click one use that baseline is robbins are allowed throughout the trial and how you anticipate that to.

Speaker Change: So much for taking my questions and congrats on all the progress recently.

Speaker Change: Just wanted to ask.

You could comment a little bit more on the recent impact of the label expansion for <unk>.

Speaker Change: Efficacy.

Speaker Change: And then on the business to.

Speaker Change: <unk> do you see any read throughs from this trial in terms of efficacy is on enrollment and the adult pediatric vik. Thank you very much.

Speaker Change: And what specific dynamics youre seeing in the U S market regarding patient acquisition patient adherence and how that compares to the ex U S experience that you've had since that label has been in place for longer outside of the U S. And the second question is if we think about the <unk> relationship that you have announced.

Speaker Change: Sorry, which phase II trial.

Speaker Change: Oh for <unk>.

Speaker Change: Read through in term.

Speaker Change: What's the question about the debit trial.

Speaker Change: Do you see any read throughs from the southern Atlantic High trial in terms of efficacy and then also in terms of amendment and the adult pediatric thanks.

Speaker Change: To what extent is this likely to be a template for a model for future relationships in ex U S. Territories is this likely to inform to a significant extent your future <unk> activities or is it very much kind of individualized to the Turkish context. Thank you.

Speaker Change: Yeah.

Speaker Change: So that's a 28 patients four arms of seven patients per arm blinded trial. So no.

Speaker Change: Obviously, no insight into the efficacy at this point, we didnt restricted it's 12 and older. So I'd say a slightly older population, we need to we're still developing the pediatric formulation for <unk>, which we're making great progress on and will that will be part of our next trial, but we don't have that part of the population. So that's all I can say now about the mix of patients towards the end of the 12 hour.

Speaker Change: Yes, so can.

Speaker Change: Can you comment on the hour your experienced international experience here with two to six Jennifer just commented on the U S and how you see that impacting the overall opportunity and then.

Speaker Change: How we think about distributor shifts partnerships.

Speaker Change: With regard to glimpse and the <unk>.

Speaker Change: So yes. Thank you so.

Speaker Change: Phase III trial, so about 25% of the patients had previously been on a glib <unk>, we're continuing a glib if they continue to clip they could not have had weight loss of 2% or greater.

Speaker Change: Hey get shrieking in Europe. So we have no treated patients younger than 16 countries and influence in Germany, UK and Spain, and we will continue to see more of that.

Speaker Change: In the prior three months and so.

Speaker Change: And can you still see previously is the impact on revenues will not be significantly impactful to patients and for the Kennedy those and also for the year the clinicians.

Speaker Change: You have to be stable on it and you cannot add a new weight loss medication during the trial and that didn't happen, but that was excluded by protocol.

Speaker Change: Got it thank you.

Speaker Change: Is there a significant win so.

Speaker Change: Okay.

Speaker Change: Thank you. Our next question comes from Rob <unk> with HC Wainwright <unk> Company. Your line is open.

Speaker Change: And that shows Thats, what I can see much slippage.

Speaker Change: <unk> indication in Europe.

Speaker Change: And then maybe you can build on this enrollment so the way we think about distributors ship. It is country by country. I mean, our general approach is to go direct where we can and then be practical and smart about where we need to leverage additional help so maybe just a little bit of thinking behind the decision to use that.

Speaker Change: So much for taking my questions and congrats on all the progress recently.

Speaker Change: Just wanted to ask.

Speaker Change: You could comment a little bit more on the recent impact of the label expansion for <unk>.

Speaker Change: And what specific dynamics youre seeing in the U S market regarding patient acquisition patient adherence and how that compares to the ex U S experience that you've had since that label has been in place for longer outside of the U S. And the second question is if we think about the <unk> relationship that you have announced.

Speaker Change: Distributor in Turkey, and how that might.

Speaker Change: Represent there'll be an indicative of our thinking going forward.

Speaker Change: Yes, it's exactly as you say, David So I think we we choose country approach country by country.

Speaker Change: <unk> menu rollout in countries, where we are direct for some specific territories, we believes that.

Speaker Change: To what extent is this likely to be a template for a model for future relationships in ex U S. Territories is this likely to inform to a significant extent your future <unk> activities or is it very much kind of individualized to the Turkish context. Thank you.

Speaker Change: Expertise.

Speaker Change: Iran is better always partner, which we do and we are doing such with maybe Sonya Israels Jen Simons immediate needs to know with CRISPR in Turkey, and we have to see that we have been very happy with us.

Speaker Change: <unk> partnerships.

Speaker Change: Yes, so can.

Speaker Change: Great.

Speaker Change: Can you comment on the hour your experienced international experience here with two to six Jennifer just commented on the U S and how you see that impacting the overall opportunity and then.

Speaker Change: Okay. Thank you next question.

Speaker Change: Thank you. Our next question comes from John Watson with citizens JMP. Your line is open.

Speaker Change: How we think about distributor shifts partnerships.

John Watson: Hey, Thanks for taking my question just wondering in the phase II, we did see some patients who dose reduced due to aes.

Speaker Change: So yes. Thank you so.

Speaker Change: Pediatric in Europe. So we have no treated patients younger than 16 countries and influence in Germany, you can stay in and we'll continue to see more of that.

John Watson: We see a regain of BMI, which gives us confidence in the drug effect, but wondering in the phase III protocol for your lying dose reductions for use during the 52 week period or if everyone set after the dose titration period.

Speaker Change: As <unk> said previously is the impact on revenues.

John Watson: Yeah no good question.

John Watson: No.

John Watson: The protocol is set so everybody dose escalates to three as tolerated.

Speaker Change: Be significantly impactful to patients and for the Kennedy those and also for the year the clinicians.

If you can't tolerate it and you stay a little longer at that dose to hopefully acclimate. Most patients do then dose escalate again, <unk>, who truly are having trouble you can dose decrease so it's a it's a dosing paradigm that does allow titration to tolerance now the vast majority of patients get to the.

Speaker Change: Is it a significant win so.

Speaker Change: And that shows Thats, what I can see much of a pediatric.

Speaker Change: The indication in Europe.

Speaker Change: And then maybe you can build on this.

Speaker Change: So the way, we think about distributors ship it is country by country I mean, our general approach is to go direct where we can and then be practical and smart about where we need to leverage additional help so maybe just a little bit of thinking behind the decision to use that distributor in Turkey, and how that might.

John Watson: <unk> desire dose at three not everybody's needed to go to three and then this has been a question out there I do think the HR world is going to end up somewhere between two and three.

John Watson: Bbs weighs a little heavier to the three I think H O b more firmly in the two to three range, but individual patients and we had one in the trial, who just couldn't tolerate it and ended up stopping the drug.

Speaker Change: Represent there'll be an indicative of our thinking going forward.

Speaker Change: Yeah.

Speaker Change: Yes, it's exactly as you say, David So I think we we choose country approach country by country.

John Watson: Yes, we may lose some like that but that's quite uncommon.

Speaker Change: In the menu rollout in countries, where we are.

John Watson: And again I'll remind you we've only had we've had fewer than 10% dropouts in the trial so far so.

Speaker Change: Direct for some specific territories, we believes that expense.

John Watson: It doesn't seem to be an issue in the phase III.

Speaker Change: Expertise.

Speaker Change: <unk> is better always partner, which we do and we are doing such with maybe Sony newsreels with Jen Simons immediately to know with <unk> in Turkey, and we have to see that we have been very happy with us.

Speaker Change: Okay, and one more if I may you talked a little bit about the Mega 1718 being.

Speaker Change: Having less activity of the emcee. One wondering can you talk about the relative activity before between the Nextgen <unk>.

Speaker Change: No ships.

Speaker Change: Great.

Speaker Change: Okay. Thank you next question.

Speaker Change: When you say efficacy is kind of TBD, if theres going be a difference there, but can you talk about the specificity with UMC for receptor between those that are candidates.

Speaker Change: Thank you. Our next question comes from John Walsh with citizens JMP. Your line is open.

Speaker Change: Yes.

Speaker Change: So we the 71, 8% and certain Atlanta tied in in vitro assays functional looking at.

John Walsh: Hey, Thanks for taking my question just wondering in the phase II, we did see some patients who dose reduced due to aes.

Speaker Change: <unk> are highly similar.

John Walsh: See a regain of BMI, which gives us confidence in the drug effect, but wondering in the phase III protocol for your lying dose reductions for use during the 52 week period or if everyone set after the dose titration period.

Speaker Change: Our.

Speaker Change: The potency as it was assessed for <unk> was done in a different assay wasn't done head to head. We are actually running that now I don't have those four results now but so.

Speaker Change: So I can't comment on that.

John Walsh: Yeah no good question.

Within the same assay comparison, what I can say is the preclinical data and again, it's on a milligram per milligram based obviously an oral drug.

John Walsh: No.

John Walsh: The protocol is set so everybody dose escalates to three as tolerated.

Speaker Change: You can't tolerate it and you.

Speaker Change: Stay a little longer at that dose to hopefully acclimate. Most patients do then dose escalate again, <unk>, who truly are having trouble you can dose decrease so it's a it's a dosing paradigm that does allow titration to tolerance now the vast majority of patients get to the desired dose at three not.

While absorption availability on the lag so a lot of factors. So you're dosing is much higher on a milligram basis, obviously, but we can get our they got in an extensive set of models similar results.

Speaker Change: Zing.

Speaker Change: The dose of <unk> as we saw with <unk> and with seven eight and the doses that are being used in the trial were built off of that understand so I think we are likely to be in a therapeutic range and I'm expecting that we're going to get adequate emcee for our agonism across each one of these.

Speaker Change: Everybody's needed to go to three and then this has been a question out there I do think the HR world is going to end up somewhere between two and three.

Speaker Change: Bbs weighs a little heavier to the three I think H O b more firmly in the two to three range, but individual patients and we had one in the trial, who just couldn't tolerate it.

Speaker Change: Got it alright, thanks, David Thats helpful.

Speaker Change: Yes.

Speaker Change: Thank you I'm showing no further questions at this time I would like to turn the call back over to David Meeker for any closing remarks.

Speaker Change: We ended up stopping the drug.

Yes, we may lose some like that but that's quite uncommon and again I'll remind you. We've only had we've had fewer than 10% dropouts in the trial so far so.

David Meeker: Okay, well great. Thanks again for tuning in this morning as you've heard we're excited about where we are and we look forward to our next calls which will be.

It doesn't seem to be an issue in the phase III.

Speaker Change: Okay, and one more if I may you talked a little bit about the Mega 1718.

Speaker Change: Updating you on some exciting information.

Speaker Change: Thanks, Paul.

Speaker Change: Thank you for your participation you may now disconnect everyone have a great day.

Speaker Change: Being.

Speaker Change: Having less activity of the emcee. One wondering can you talk about the relative activity before between the Nextgen <unk>.

Speaker Change: You say efficacy is kind of TBD, if theres going be a difference there, but can you talk about the specificity with UMC for receptor between those that are candidates.

Speaker Change: Yes.

Speaker Change: So we the 71, 8% and certain Atlanta tied in in vitro assays functional looking at.

Speaker Change: Potency are highly similar.

Speaker Change: We are.

Speaker Change: The potency as it was assessed for <unk> was done in a different assay wasn't done head to head. We are actually running that now I don't have those full results now but.

Speaker Change: So I can't comment on that.

Speaker Change: The same assay comparison, what I can say is the preclinical data and again, it's on a milligram per milligram based obviously an oral drug.

Speaker Change: Absorption availability on the lag so a lot of factors. So you're dosing is much higher on a milligram basis, obviously, but we can get our they got in an extensive set of models similar results using.

Speaker Change: The dose of <unk> as we saw with <unk> and with seven eight and the doses that are being used in the trial were built off of that understanding.

Speaker Change: So I think we are likely to be in a therapeutic range and I'm expecting that we're going to get adequate emcee for our agonism across each one of these.

Speaker Change: Alright, Thanks, David Thats helpful.

Speaker Change: Yes.

Speaker Change: Thank you I'm showing no further questions at this time I would like to turn the call back over to David Meeker for any closing remarks.

Speaker Change: Okay, well great. Thanks again for tuning in this morning as you've heard we're excited about where we are and we look forward to our next calls which.

Speaker Change: We'll be updating you on some exciting information.

Paul: Thanks, Paul.

Paul: Thank you for your participation you may now disconnect everyone have a great day.

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