Q3 2025 Arrowhead Pharmaceuticals Inc Earnings Call
Ladies and gentlemen, welcome to the arrowhead Pharmaceuticals conference call.
Throughout today's recorded presentation, all participants will be in listen-only mode. After the presentation, there will be an opportunity to ask questions. I will now hand the conference over to Vince Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.
Thank you. Good afternoon, everyone. Thank you for joining us today to discuss arrowheads results for its fiscal, 2025, third quarter. And in June 3020,
With us today, for management. Our president and CEO Dr. Christian angelone, who will provide an overview, Dr. Bruce Gibbon interim chief medical scientists who will provide an update on late clinical and Regulatory. Andy Davis. Senior vice president and head of the global cardio. Metabolic franchise, who will provide an update on commercialization activities, Dr. James Hamilton, chief medical officer and head of R&D. Who will discuss our earlier stage development programs, and Dana pal, Chief Financial Officer, who will give a review of the financials.
Following Management's prepared remarks, we will open the call to questions.
Before we begin, I would like to remind you that comments made, during today's call contain certain forward-looking statements within the meaning of section, 27A of the Securities Act of 1933 and section 21 e of the Securities Exchange Act of 1934.
All statements other than statements of his.
Historical factors.
Our forward-looking statements.
And our subject to numerous risks and uncertainties, that could cause actual results to differ materially from those expressed in any forward-looking statements.
For further details, concerning these risks and uncertainties, please refer to our SEC filings, including our most recent annual report on form, 10 K, and our quarterly reports on form 10 Q. I'd now like to turn the call over to Chris anal, president and CEO of the company. Chris.
Segments.
Good afternoon, everyone, and thank you for joining us today.
For discussing the progress, we've made over the past quarter. I'd like to address questions surrounding our partnership with this rapid Therapeutics
From Airway.
Nevertheless, the situation has negatively affected our stock price. So I'd like to talk about what we think is important from an arrowhead shareholder expected.
So after recently announced a strategic restructuring plan that includes cost cutting measures and a pipeline review that prioritizes funding development and commercialization of the programs, the company in the licensed from Arrowhead.
So rapid management has clearly stated that it believes this represents, the future of the company. And this gives us confidence that surround it will continue to meet its Financial development and Commercial obligations on the agreement.
The collaboration is continuing to operate as expected, which is of course, a good thing for error ahead. It represents a source of capital to fund internal programs platforms and Commercial buildout, while ensuring the assets of licensed serreta are developed in commercialized.
Should fail to meet this obligation.
Should disrupt it fail to meet its obligations. The agreement has clear termination Provisions than an RV would cause potentially valuable assets and Associated intellectual property to be returned to Arrowhead without Arrowhead having to repay any of the capital. We have received from cesta. That would also be an acceptable outcome.
Let's now move on to our progress in the recent period. The biotech Market has been challenging over the past several years, but we have no control over the broader sentiments.
What we can control is our drive to serve patients and create shareholder value.
Review. These broadly as 3. Inter related mandates.
To create value to create novel medicines capable of real impacts on human health, to generate the capital to fund development of them and to build an engine to drive the growth of both.
We made important progress in all these areas, during the recent period. Let's begin with development. This is clearly led by the podesta
we can continue to have productive interactions with Regulators in the US and Europe about our Market, authorization applications for the treatment of FCS and we look forward to our November 18th
We are also on track with commercial buildout apps and our complete team is nearly assembled support and SPS launch.
Further, we achieved full enrollment in just 3 Chapter 4 and mere 3 Arrowhead Phase 3 studies designed to support regulatory submissions for possessor and in the treatment of severe hypertension or anemia or SHTG.
these studies enrolled approximately 2,200 patients in 24 countries, in a very short period of time,
The primary endpoint is focused on triglyceride reduction at 12 months. With full enrollment reached in June 2025, we are on track for study completion by mid-2026.
disaster and arrowheads candidate designed to reduce expression of angptl3 is being developed as a potential treatment for homozygous familial hypo cholesterol, India or hofh a rare genetic condition that leads to severely elevated, LDL cholesterol and early onset cardiovascular disease,
We initiated these phase 3, study and enrolled. The first patients in July,
Approximately 60 subjects over the age of 12, will be randomized to receive 4 quarterly, doses of 200 milligrams of asaran or placebo.
The primary influence is the percent change in fasting LDL cholesterol from Baseline to month 12?
We think that given our Phase 2 Data, this feels like a relatively low-risk phase. 3 potentially enabling the commercial opportunity that overlays well with the team we are building for Flatbed
Therefore with the relatively small investment in a 1 year, 60 subject, phase 3 study. We see an opportunity to extract more value from the commercial infrastructure. We are already building
The online VIN and zodiacs are in. There are two additional investigational RNAi high-based candidates developed by Arrowhead that are currently in late-stage pivotal studies.
The your Saran being developed for Alpha 1 and drips and liver disease is partnered with de Arrowhead retains, 50/50 profits here in the US, 20 to 25% royalties outside the US and up to 527.25% of remaining Regulatory and Commercial milestones.
Canada's guided that is Phase 3 study could be fully enrolled this year from the study has a primary endpoint at 2 years.
We'll pass our end being developed for ascvd, is licensed to anigen, which announced that its phase 3. Cardiovascular outcomes trial was fully enrolled in the first half of 2024,
We are eligible for up to 485 million of remaining. Milestones related to this program.
I highlight these 4 late stage drug candidates because we expect them to be substantial value drug drivers in the near to midterm.
They also set up the possibility of multiple launches between November 2025 and the end of 2028.
as we discussed in the past, please ask her in and your later stage drug candidates together, form the basis of our near-term value proposition
But these are enhanced by several programs. Underneath them, all of which made good progress in the recent period.
Broadening out.
Arrow in hbe and arrow 7.
Arrow in hbe began a phase 1 2, study, early in the year. And we recently announced that we dosed the first subject in Phase 1 to clinical trial of Aero ALK 7 which we believe is the first investigational RNA High therapeutic to enter a clinical studies targeting adapost tissue.
We expect to have initial early data sets for both candidates at the end of the year.
Expanding the cardio metabolic franchise, we expect to reach the clinic this year. For what we believe will be the first RNA. I der in clinical studies
it is designed to reduce expression of both pcsk9 and hypo C3 and could be a powerful agent in the treatment of as CBD in patients with mixed hyper Lian
there is a substantial unmet medical need in this large patient population and we should have a good idea how well this drug candidate, lowers ldlc and triglycerides in 2026.
We continue to make good progress in manufacturing studies and clinical trial planning and we are on track to file a CTA in the coming months.
Our burgeoning systemically delivered CNS. Franchise is also a potential leader to make your own value driver.
To do this print this platform translate from primates to humans. We think it would represent a transformational Leap Forward in CNS Therapies.
Importantly, later this year, we expect to file a CTA for Aero map. T, our wholly owned candidate against Alzheimer's disease and various T off of these. We are hopeful that we can achieve initial proof of concept with this platform and candidate as early as late 2026,
Beyond these. We have a wealth of other clinical stage programs to drive longer term value, and service sources of capital, through Business Development.
In fact, we are on track to meet our 20 and 25 initiative. Whereby we would have 20 individual drug candidates in clinical studies or at Marcus by the end of 2025.
9 of these are partnered.
The 11 full volume on clinical candidates service, potential, partnering targets and provide value redundancy for our other programs and we expect several data readouts through the end of the year.
Together, these give us tremendous amounts of ammunition to create value.
This brings us to the second important component of building durable value and adequate sources of financing independent of the capital markets.
We currently have a strong balance sheet relative to our needs over the next few years. In addition we have made important progress, sourcing new capital in the recent period.
We recently announced that our Berna Therapeutics majority owned subsidiary, signed an asset purchase agreement. Whereby sanity will acquire rights to develop and commercialize close aeran as a potential treatment for SDS and shtg in greater China.
By certain will receive an upfront, payment of $130 million, and be eligible to receive Milestone payments of up to 265 million upon approval of disaster, and in fps and as and shtg in mainland China.
As is further eligible to receive. Royalties on net commercial products, sales in Greater China, as part of the arrowhead by certain a license, which was assigned in part to send, okay?
When we co-founded by certain in 2022, we saw greater China as an important, but undervalued potential future market for multiple programs in arrowheads pipeline.
We licensed, we licensed Chinese rights for pedestrian Zoda, and, and Aero hsd to buy Serta, which received outside funding to support development.
The nopi has a strong presence in China as well. Positioned to assume commercialization of pedestrian and should be approved by Chinese regulatory authorities.
We have not used any aerohead funds to advance China specific development or regulatory activities. And if 1 closing, we will own approximately 56% of that sir
Their tax considerations and other costs. But we ultimately expect to realize a sizable amount from the steel.
We hope that over time, we may monetize Chinese rights to zoan and arrow hsd in a similar fashion.
The next key Capitol Building event, I want to mention is reaching the 1st of 2 pre pre-specified enrollment Targets in Phase 1 2, clinical study, aotm 1 for the treatment of type 1 and myotonic District fee which is partnered with Sarepta.
Reaching this Milestone triggered, 100 million dollar payment, which is due from Surah within 60 days and 1 of his earnings.
We believe we're on track to meet the second enrollment Target at the end of the year, which would trigger an additional $200 million pay.
our large Pipeline and expectation that we have cash into fiscal 2028 suggests that we have the first 2 categories of value, creation, under control
This leads us to the third priority, creating an engine to drive the growth of both.
Using our Diamond technology.
This gives us broad reach to go where disease is and coupled with our expectations of introducing 3 to 4 new drug candidates into clinical studies. Every year we expect to continue to grow our ability to impact human health, very rapidly.
This also reads our ability to continue to assess significant Capital through Business Development before and after achieving substantial product Revenue.
Ultimately, we are doing all of this to bring important medicines to the patients and use them, and this is not happening without careful preparation.
We are building a right size, commercial organization, staff, with what we think are the top people in the field with extensive experience in cardio metabolic and rare disease.
We can strong progress in Market, access analytics, operations, marketing, and building a commercial sales. Team us logs preparations are now in full swing for disaster and and SPS and we intend to be to be launched ready even before our Paducah date, on November 18th.
With that overview. I now like to turn the call over to Bruce, given Bruce
Thanks, Chris, and good afternoon, everyone.
Since we last spoke, we've continued the forward momentum. In our development of Pizzas around to treat FCS and severe hypertriglyceridemia.
Are usna to to support FCS treatment was submitted last year. And our Pupa date is November 182022.
Filings in Europe, Australia and Canada are all progressing as well. We are reassured that the Cadence of our interactions with us and Global Regulators has not changed.
Nor have any expectations of adhering to established timelines.
2 months ago, we completed enrollment in our Shasta, severe hypertriglyceridemia development program, well, ahead of expectations. The Shasta program is comprised of chefs at 3 and Shasta 4 2 ad and well-controlled trials designed to meet the statutory requirement of substantial evidence requirement for effectiveness.
Along with the support of mere 3 trial in mixed hyperlipidemia which provides addition additional safety data in a relevant patient population to satisfy regulatory requirements for a complete file.
The sizing of the phase 3 shafts to 3 and 4 studies was informed by the needs of regulatory authorities to demonstrate safety. While confirming the efficacy suggested by The Phase 2. Shasta 2 trial where the where the primary endpoint of difference and triglycerides at week 24 compared to Baseline for the 25 Mumford.
The events of cute pancreatitis.
The 2 shafts are faced through trials, are similarly designed totaling around, 700 patients and are very highly powered to demonstrate statistically significant Improvement in triglycerides with 25 milligrams of pizzas and compared with Placebo, over 12 months of treatment.
After accounting for randomization allocation, in the Shasta studies the the placebo control double blind mirror 3 study was designed to demonstrate statistically significant Improvement. Triglycerides with 25 milligrams, possessor ant compared with Placebo over 12 months of treatment and is also expected to achieve a high level of significance while primarily serving to enhance the safety database for the shtg filing.
Assuming positive data, these 3 separate phase 3 studies. Should support our planned. Snda filing for shtg in the fourth quarter of 2026.
Although Shasta 3 and 4 were not prospectively designed to be outcome studies given the sizing of the combined studies and The observed event rate in the Shasta 2 study. We hope to observe at least a favorable Trend in pizzas impact a documented acute pancreatitis within the studies.
However, the shtg program also features a unique outcome, study named Shasta. 5 designed to directly assess the ability of possession to reduce the time to first event a positively adjudicated Q, pancreatitis in high risk, shtg patients
While it is possible that this trial will be submitted to regular toy agencies for possible. Inclusion in labeling, the primary audience and impetus for this study is actually National Health technology, assessment organizations
On the basis of observational data demonstrating the causal link between elevated triglycerides and the risk of pancreatitis, and the observed effects of S. Shtg in patients, it is expected that fewer than 150 patients will be recruited to accrue sufficient events in this outcome study.
And rationale of the study had an upcoming major medical meeting.
The broader cross functional cardio. Metabolic clinical has been present at Key medical congresses. This past quarter including Endo National lipid Association and the American Society of prevented uh preventive. Cardiology
We could continue to share new data to demonstrate the value of possession, and the reception from the scientific and clinical communities has been engaged enthusiastically.
Turning our attention to zodiac, another genetically validated rnai drug.
Designed to reduce expression of Antioch protein, like 3 or Ranch PTO 3 is now in development for the treatment of homozygous familial hyper cholesterol, alimia a rare genetic disorder characterized by exceptionally high LDL cholesterol levels due to very low or absent, LDL receptor function.
The results of Gateway are open label. Phase 2, study in this population were presented this year at the European ethos Sclerosis Society and showed robust and durable, reductions in ldlc and other arthrogenic lipoproteins
The efficacy results were similar to those of every Acomb, a monoclonal antibody against the PTO 3 that requires monthly infusions.
but with pasaran the the uh, the dosing is convenient, quarterly, subcutaneous dosing,
We are pleased to report why the face study of zeran and hofh began earlier this year. In the first patient was randomized last month.
Assuming successful demonstration of safety and efficacy data, Yee could support regulatory filings for dasaran as early as 2028 or 2029.
I'm not I will now turn the call over to Andy Davis Andy.
Thank you, Bruce.
The FDA Paducah date for pastor and set for November. 18th is now less than 4 months away, and I'm pleased to report that our commercialization preparations are fully on track.
When I last updated you in May, we were in the midst of building out our commercial sales organization.
I'm proud to share that. As of this month, our national sales leader, full team of regional sales, leaders and fit for purpose Field. Force a rare disease specialists are now on board and undergoing training.
By the end of this month, the team will begin engaging with key Healthcare professionals, advancing FCS disease education in preparation for launch.
Our Market access team continues to execute exceptionally well against our pre-approval information. Exchange strategy.
To date. We've connected with payers representing over 85% of us, covered lives, delivering compelling data on the clinical value and anticipated profile of possession.
We remain highly encouraged by payer interest, particularly in plaster and the potential to deeply lower triglycerides.
Support achievement of guideline directed goals, namely less than 500 milligrams per deciliter, and significantly reduce the risk of the acute pancreatitis.
We're also seeing positive developments in the FCS landscape, which reinforce our confidence heading into launch.
The significant unmet need in the FCS Community is clear and acknowledged by both payers and providers.
On the payer, front Dynamics appear, to be favorable with access being, granted to both genetically confirmed patients and those patients. Satisfying, the diagnostic scoring tools designed to discriminate patients with shtg from those who signed symptoms and medical history mimic genetic FCS.
This is especially motivating, given that possessor is currently the only apoc3 inhibitor to demonstrate clinical results in both genetic and clinical SCS in a phase 3 registration of study.
And from a provider perspective, the specialty mix were observing preventive, cardiologists, endocrinologists and lipidologists is exactly what we anticipated and aligns well with our launch targeting strategy.
In summary we remain on schedule and energized by the opportunity to bring investigational possessions into individuals living with FCS and their families.
We're excited for what possessions of potential first-in-class, sirna therapy, could mean to those suffering from this difficult disease.
We'll now turn the call over to James Hamilton James.
Thank you, Andy. I'd like to provide an overview and updates on several of our early stage clinical and translational development programs.
In obesity, our Aero inhibition and arrow elk 7 programs, both targeting the active and pathway are currently being investigated as treatments for obesity in Phase 1 studies.
Multi-dose cohorts, using Aero inhibiting in combination with your zeti?
The arrow L7 study is in the single dose escalation phase with multi-dose and combination cohorts opening soon.
We anticipate sharing data from both the el7 and inhibit studies at the end of the year.
Regarding our muscle clinical programs partnered with Sarepta. The aerodium 1 Phase 1 2A, study is completed, the single dose coordinates and is now enrolling multi-dose cohorts of patients with myotonic drophy.
Similarly, the aeroht ducts 4 Phase 1, 2A study. Has nearly completed enrollment of a single dose of cohorts and the first year-long multi-dose cohort is open for enrollment.
Consistent with previous guidance. We are on track for data, availability by year end. However, final timing on data release is determined by Sarepta.
Our wholly owned aeromat T program is on track for submission of a CTA by year end.
As a reminder aerial map T uses, subcutaneous administration of a novel srna, delivery platform designed to deliver an srna targeting CNS towel protein expression.
Cross the blood brain barrier.
How aggregated into neurop fibrillary? Tangles is believed to be 1 of the causes of factors of Alzheimer's disease.
And is also positive of various other Towpath.
Non-clinical. Evaluations. In monkeys was substantia administration of aromat, using clinically translatable doses, have shown better than 75% knockdown of tissue level of mRNA in the CNS.
Importantly, monkey tissue level knockdown has translated into CS CSF. Tau protein reductions of better than 75% with duration of effect supportive of either monthly or potentially quarterly subcutaneous dose regimens.
The monkey CSF. Tau protein knockdown data are important translational step as we move this program towards the clinic.
Both preclinical data will be presented at an upcoming scientific conference.
I will now turn the call over to Dan Appel.
Thank you, James and good afternoon everyone as we reported today, our net loss for the quarter ended. June 30th, 2025 was 175.2 billion dollars or a loss of 1.26 cents per share.
Based on 139 million, fully diluted weighted, average shares of standing.
This Compares with a net loss of 170.8 million.
For a loss of 1.38 cents. Per share for the prior year quarter end of June 3024.
Based on 124.2 million, fully diluted weighted, average shares outstanding. And that prior year quarter,
Governor for the quarter, and on June 30th, 2025, was $27.8 million.
Driven almost entirely by the recognition of Revenue related to our license and collaboration agreement. Sira
of the 27.8 million roughly 20 million related to the ongoing recognition of initial surreta consideration and 7 million related to reimbursement of collaboration related costs.
After the end of our third fiscal quarter, we announced 2 important events.
Each of which will have a positive impact on our financial position.
First there is a hundred million dollar dm1 Milestone payment from Sarepta which Chris mentioned earlier on the call.
At this event occurred after June 30th Revenue associated. With this Milestone will be recognized in our fiscal fourth quarter Financial results.
We anticipate achieving the second dm1. Development, Milestone valued at 200 million by the end of
the calendar year.
On August 1st, we announced that Arrowhead signed an agreement to acquire exclusive rights to develop and commercialize investigations of possession.
In Greater China from Vice sirna Therapeutics.
Carol heads majority owned subsidiary, by Serna will receive 130 million dollars of front upon closing. Additionally by cirno, who received up to 265 million dollars in potential future regulatory, Milestone payments.
And potential royalties associated with the sales of possessor and in greater China.
we expect to record revenue of 130 million in the fourth quarter associated with The Upfront payment only,
June, 3025 for 193.3 million compared to 176.1 million dollars in the prior year quarter.
Or an increase of 17.2 million.
The year-over-year increase was driven by amongst other things, roughly 10 million of higher R&D costs primarily as a result of our phase 3 registration as well as for a possession.
In shtg, as well as higher cost related to active candidates in the pre-clinical stage.
It's worth bearing in mind that year to date, approximately 70% of our clinical trials, spend can be attributed to the phase 3 registration of trials for possessor and an S shd as Bruce mentioned, these studies are now fully enrolled and we expect data to read out next year.
additionally, as planned or sgna costs, have increased by 7 million year-over-year driven, primarily by our preparations for commercialization, in advance of the fda's upcoming Hadoop for Action date later this year, on November 18th,
Turn to cash. Net cash used in operating activities during fiscal quarter 32025.
Was 154.7 Million compared with net cash used in operating activities of 115.49.
In the prior year quarter.
The increase in cash used in operating activities driven by several factors including the aforementioned higher operating expenses and timing of clinical trial payments.
According to the balance sheet, a cash and Investments totaled at 900.4 million as of June 3020 2025.
Our common shares outstanding as of the end of this quarter were 138.1 million.
And with that, I will now turn the call back over to Chris.
Thanks, Dan.
Everybody continues to achieve strong execution and Discovery clinical Regulatory and business development.
Our pipeline has become increasingly insured with 4 Airline discovered candidates currently in pivotal phase 3 studies.
In addition to our commercial buildout is designed to make us launch ready. Very quickly, simple as ask for and receive regulatory approval on the November 18th 2025. But if the date and lastly, we have a strong balance sheet that we think gives us the financial resources to continue to move multiple integrated. New medicines to the clinical and Regulatory process and ultimately get them to the patients meeting.
Thank you for joining us today, and I would now, like to open the call to your questions.
Thank you at this time. We'll conduct the question.
1 on your telephone and wait for your name to be announced.
To withdraw your question. Please press star. 1 1 again, please limit to 1 question.
Please stand by while we compile the Q&A roster.
Our first question comes from Maury Raya. Croft of Jeffrey's your line is now open.
Good afternoon. This is Ferran for Mario. Thank you for taking our questions. When thinking about your own SAT pivotal with ongoing assessments at 3 and 4, how are you thinking about the prospects of competitor and its programs reading out of September from the course studies, especially with respect to the triglyceride reduction as well as signals in the acute pancreatitis?
Uh, so I'll answer that in in Bruce if you have anything that you, you think. Um, uh is necessary. Look, you know, we can't, we have no control over over over over other people's studies. It's difficult to compare, uh, 2 drugs, across 2 different studies, um, or more, uh, frankly in this in this respect and so we're just focused on our own studies here. You know, we we've had very good data in our Phase 2 studies. So that the the very good data in our phase 3. A study in FCS. Um uh and we think we've got a best-in-class uh drug user here. Um, we look forward to seeing
Fhpg data look like but that is our expectation that we'll go from there.
Bruce, do you have any doubt on that?
Not really. Um, as you said, we, you know, it's hard to compare across studies, I will say that, you know what they have, you know, um, relayed about their, um, their patient population looks quite similar to to our patient population at the time of enrollment. Um, so, you know, I I think it will be, um, uh, interesting for us to see, you know, what their data actually, you know, shows when they reported out in September and then probably in more detail at a later, uh, academic presentation. Uh, so we'll follow with interest, but you know how much bearing it has is is always hard to tell.
Triglycerides from Baseline. Um and second is how many patients can get to go whether that's gold.
defined as
As as triglycerides below 880 or below 500. Um, you know, I think those are the those are the key points here. And
And we we expect Physicians to look at that and expect patients to look at that.
Got it. Thank you.
You're welcome.
Thank you.
Our next question comes from Jason Gerber of Bank of America. Your line is now open.
Hey guys, thanks for taking my question. Um, so, um, another question on the uh, uh, shtg program if I, if I heard you right. So it sounds like, um, what you're confirming is your Baseline demographics of your, your 2, phase 3 studies. Uh, look, similar to the published Baseline demographics, that, that I owned us had published for its core studies. Like I said, would be in terms of the 2 key subgroups, which is ultra high triglyceride levels and past history of AP. And I'm curious, um, you know, your thoughts on this indicated that they they are seeing events on a blinded basis, at least 13, uh, with like a skew of, like, 700 drug 300, Placebo, something like that. So, I'm just kind of curious as you as you absorb that because, like, the the event rates, the big unknown here. So, I'm just kind of curious, you know, has your thoughts changed at all around probability of showing at least the strong numerical Trend? Uh, by pulling the shots to 4 and 5 studies. Thanks,
You know I think that's a it's a difficult to answer that question. Uh you know, Jason and the reason is because, you know, we we count, um true adjudicated cases of pancreatitis
Uh, the ionis, um, approach is not just counting pancreatitis, but also abdominal pain and of course, abdominal pain. You know, can be, you know, non-specific. Uh, you know, although the, you know, the effort is to determine uh, that add abdominal pain. When it occurs is, is actually um, you know, not related to, to other, you know, elements. You know, such as, um, you know, alcohol or or gallstones, for instance. But it is, it is a little bit of an Apple's largest comparison, you know, of actual pancreatitis to um, you know, to abdominal pain events. So it's hard to know what they're going to show. You know, in the end uh regarding pancreatitis which I think is the the most important measure abdominal pain matters in sh in in you know shtg and high triglycerides, it can be debilitating for patients and difficult but it's not a fatal thing. Uh where where pancreatitis?
You know, produces organ damage and can lead to fatality. So, it's a, it's a much different. Um, it's a much different animal, uh, for, you know, for Physicians to manage and, of course, repairs to deal with as well. So that part of, it's harder to, to assess and I, I'm not sure that we'll get granularity on that, um, even when they announced their results in September, so it's a little bit difficult to say Jason at this time, we will track abdominal pain as well. But we're, we're really focused on, you know, acute pancreatitis, you know, given that, that's the, the real disease, you know, with, with severity,
And will you guys be publishing your your Baseline demographics? I don't know in the next 6 to 9 months or so. Yes I think we will we'll be submitting. We'll be submitting that uh, you know, for future a future medical conference for sure.
Okay, thank you.
You bet. Thank you.
Our next question comes from David Leitz of City. Your line is now open.
Hi there, this is Mary. Kate on for David today. Um, thanks so much for your overview of the anticipated. Uh, FCS FCS launch. Um, I guess how does this treatment address the clinical and that need in the space and maybe what feedback are you receiving from Physicians ahead of this potential launch? Thank you.
Uh, Andy, you take that, and Bruce, add anything that you think should be added. Yeah, happy to take that. So thank you for the question, Mary Kate, related to the clinical unmet need. Well, we know with respect to familiar kind of anemia syndrome patients that they suffer from physical symptoms, including abdominal pain. And of course, as Bruce mentioned, acute pancreatitis, which can lead to recurrent pancreatitis.
um and pizzas is, is the only agent in a registrational phase 3 study that just demonstrated a statistically significant reduction in acute pancreatitis risk in Palisade
So those are 2 of the primary unmet needs that we believe, Pastor can address in, in FCS, I would say moreover, just from a, a patient convenience and tolerability perspective disaster and does continue to have a very desirable profile with only quarterly dosing. So, for injections, a year, which is very different than the, you know, the current treatment regimens that are available for these patients presently. So hopefully, that addresses your question around, why we believe pastor and fills, uh, some important unmet clinical needs
Thank you. Our next question comes from Patrick.
Leo with HC, Wayne Wright and Co your line is now open.
Thanks um, good afternoon and congrats on all the progress. I'm, I'm just wondering you know, as per axis appears favorable for both genetically confirmed and clinically defined FCS is there. Is there any uh differentiation in the coverage path? You know, for a high-risk severe High triglyceride patients. Um particularly those that don't have a pancreatitis, um, history. And I guess I'm, I'm just wondering if you can speak to your expectations for pricing between FCS and severe High triglyceride indications, particularly just given the different population sizes.
The medical cost burden.
Uh, so so, um, regarding pricing, you know, we are we're not prepared to do a pine too much, um, on on a potential, fht price, um, um, we are still looking into that. Um, we certainly would expect, um, you know, that to be a lower priced, uh, drug that FTS. Um, but but beyond that, um,
we're we're still, we're still working on that question.
Thank you. 1 moment for your next question.
Our next question comes from.
Procar aggro from Cantor your line is now open.
Hi. Um, congrats on the quarter and thank you for taking my questions. Uh, so maybe in the corrupt situation? Um, I think SEPTA also owns 10 million plus shares of arrowheads talk. So what could be a practical solution here to solve for this? If SEPTA intends to sell their shares? And secondly, on sstg? Uh, maybe a question for Andy, uh, what, what sort of commercial activities you are doing to educate the community about how fhg is different from the lipid Market. Um, seems that the street has been anchored to lipid pricing and the update there for, um, for for the drugs, um, any color that would be helpful. Thank you.
Sure. It's the um, uh, yes, Struck, it does own some Airline chairs. Um, um, they, they're lock up. Period, is is still, um, in fact right now. Um, um, I don't
You know, I can't tell you what, what their plan is, um, for those shares, I can tell you that that we have had inbound interest in acquiring shares and so I, you know, I'm not so worried that if they decide to to sell those, but they can find it, why are they? They certainly could. Um, but I I don't know what kind of longer term plans are in terms of of holding, hold on to those shares and for how long,
And you want to address the yeah, thank thanks for cars. It relates to to, to education, of course. We have an active medical education in the form of our Medical Science liaison, who are conducting scientific exchange. Moreover there is
Independent medical education, continuing medical education, that's ongoing related to individuals with extremely high triglycerides. The unmet medical needs burden of disease and education around clinical study results. Certainly in the case of Palisade um I would say a lot of the education that's happening. Now in the community is is related to education around the disease, burden around goal attainment, namely in education around the guideline directed wrist threshold of 500 milligrams per deciliter. And then of course, the focus on the outcome of Interest which is acute pancreatitis events. And so
Friend is a pancreatitis drug and I think should be thought of as such um um. And priced as such to be honest. Um, um, uh, you know, so they so. So yes, you know, it is, this is a lipid parameter, but this is not an ASD drive. This is this is a a pancreatitis drug and and and there are there are populations that are at at at
Substantial risk of pancreatitis of acute pancreatitis with with the high levels of of Trevor Rice. And so, I think that's the way you need to look at it.
Thank you.
Thank you. Our next question, comes from eleana, Merill of UBS, your line is now open.
Hi, this is Joseph for All for Ellie. Thanks for taking my question, and congrats on initiating the use of the trial for us, or that you're in. I'm wondering if you can talk about your latest estimations of the size of the HRO, FH addressable patient population. Thank you.
You're you're probably what experts on that. Why don't you take that 1?
Yeah, so so the the literature would suggest that the prevalence for HOH is anywhere from roughly 1 in 500,000 to 1 in a million persons. And so, um, there's been quite a lot of evidence produced in the HOH space over the years, as new therapies, have become available. So we see the the accessible population for HOH being similar to those estimates.
Thank you. Our next question comes from Edward tent off of Piper Sandler. Your line is now open.
Great, thank you very much. I think, um, little housekeeping question, if I may use congrats on the, um, the sirna deal. So, does that cash go to Arrowhead and is it able for you guys to invest that?
I hate it. Um, so so the, the the cash goes into by certain stuff um, and, and um, and a portion of that, a large portion of that, um, will be distributed to shareholders of by certain amount. And, and as I mentioned, you know, at close Willow about 56%, if I turn off, um, not all of it will go out, um, you know, there, there, there, there, there will be some tax liabilities, and also, we need to leave some cash into the company because as I mentioned, they also have they have ongoing, um, studies, um, with With Disaster and related to fhpg, although it's stand up, we will take that over. They also have have studies. Um, um, for Zod aeran, they also have some Superior hsd studies ongoing. Um, it's not a huge, it's not a huge cost, but there is some cost there. And ultimately again, as I mentioned in the pre Mars, my my our goal here is to monetize the China rights for zodiac and the generalized for ho for for
Arrow hsd in a similar manner that we, that we did for for disaster. And so, so, anyway, long story short is, is, is, you know, we will, we will bring home. Um, I think a substantial amount of
of that Capital, but not all of this.
Great, that's helpful. And then, when it comes to the R&D, the annual R&D from Sarepta, is that paid all at once on the annual anniversary. Thanks.
Uh, yeah, yes. So so they uh, they will pay us a year over for 5 years, and that payment is due in the first quarter of every year. So I, I believe it's February. Um, is that right Dan?
I think it's it's February. Um and so so we we we have a 100 million due now for the first year and 1, Milestone, 200 million that we think will trigger at the end of the year and then a further 50 million. Uh, due for the annual payment in February,
Great, thanks.
Thank you.
Our next question comes from Luca. I see of RBC Capital markets. Your line is now open.
Oh, great. Thanks guys for taking the question. This is Shelby on for Luca. Uh can you just talk about the initial presentation for pizzas that initial approval will be for pre-filled syringes? So is that correct? And if so what is the path to have this in the form of an auto injector? And how should we think about that timeline? Thanks.
Uh, sure, Andy we want to discuss that in the in the Bruce you want. You can talk about more of the granularity of the uh of the of the of the auto.
Yeah, that's right. Shelby. So our initial presentation,
In the FCS space will be a pre-filled syringe and there is development underway for an auto injector in the s shtg.
On that. Yeah I would just say that the the auto injector you know you know will be uh either available at the time of launch for the shtg indication or soon thereafter uh that's our current expectation.
Great, thanks.
Moment for your next question.
Our next question comes from Monty fuhar of Lee rink you're in the line is now open.
For Monty. Thanks for taking our question and congrats on the quarter. Uh, maybe shifting over to the inhibe readout later this year. Can you just share a little detail around which cohorts? We should expect to see data from whether that's the sad mad combo and then internally. What do you guys really hoping to see here relative to the other data sets, from muscle sparing agents that we've seen so far, thanks?
Yeah, sure. I can take that and we'll, we'll have data from all of those cohorts, that you mentioned, sad mad, as well as the combination cohorts. And um, we'll be measuring a handful of different biomarkers including PD biomarkers, like measurable activity and the blood, of course, we can look at body composition based on MRI and, uh, and weight loss changes in body weight. That that, of course, we've got a whole host of lipid parameters. In glycemic control,
parameters, that we'll look at
thank you. 1 moment for your next question.
Next question, comes from Mike essay Morgan Stanley. Your line is now open.
Good afternoon and thanks for taking the question. Maybe just to follow up on the last question related to the Obesity updates later this year, uh, just curious if you see what you want to see there, what you know, what would be some of the scenarios around next steps for those programs. Thanks.
Yeah, so so those are hard questions. Um, I don't think we we I don't think we go into to most studies, you know, with with um,
You know, with uh, with an idea that that if we see X, we will move forward. And, and, and with some manner, if we see why we will move forward, it's some other manner. If we see Z, we won't move forward, um, you know, we're in the food seeking business. Uh, we will, we will do the study and we'll do the data look like and then and then move on from there. But but, um, I don't mean to evade your question. We just, we don't go in to these studies with any sort of preconceived ideas about what might come next, uh, until we see some data.
Understood. Thank you. Yeah, I was just I was just sort of add to that that we need to, you know, keep in mind that these are novel mechanisms. These are not just another, you know, GOP 1, you know, Agonist, you know, axis sort of you know drug where
You know, we're looking at, you know, different behaviors and, and really looking for a white space, um, opportunities, um, you know here and, and it it's very hard to, to predict those it's much easier to at, you know, answer a question like that if you're coming in with the, you know, the 10th GOP 1 Agonist, um, but it's it's quite hard to answer that question when you're dealing with a completely novel mechanism that that has not been in humans before.
Makes sense. Thank you.
Thank you. Our next question comes from Joseph Tom of TD Cohen. Your line is now open.
Hi there. Good afternoon and thank you for taking my question. Maybe on the the mere 3 study, I guess, given that these patients will likely have a lower mean fasting for like, if that level is there, an increase risk that potentially? This patient subset would be more at risk to self adherence of, uh, our top levelized or, or maybe a little bit of the less adherence, to background, like the lower therapy than what. You might see in chapter 34, and um, I guess could that create some variability in the AE profile or or end points. I guess, why? Or or why not? And then when you think about the readouts, for these 3 trials, would these all come at the
The same time and it would be 1 Top Line release or would these be discrete events? Thank you.
And and mixed hyperlipidemia in the last few years, 1 would possess around 1 with Zoda. And I wouldn't, I wouldn't say that the behavior in those trials was all that different than we saw. We saw in Shasta 2, or Palisade, with respect to adherence to the protocol. It was pretty good for both. Now that may be partly, you know, we, we pay a lot of attention, you know, to the detail of execution of clinical trials, and, you know, we tend to have a low Dropout weight, uh, you know, rate in a pretty good adherence rate, uh, probably in no small part because of that. Uh, but I, you know,
I'm not, I'm not too concerned about that. And, of course, we have Placebo in the in these trials and and, you know, you expect the placebo Behavior to, to sort of, mimic the behavior that you get in the active treatment arms. So hopefully whatever you see, balances out, you know, anyway, relative to Placebo. But uh, but I don't think we're expecting anything particularly different.
Great. Thank you. And then the last part was are these going to read out at the same time on the top line are all these be 3 separate releases
I don't think we've really come to a determination on that. Um, you know, in theory, we'll have you know, the, you know, the data from this through trials, fairly close together, but I don't think they'll all show up on the same day. So, um, I, I'll leave it to Chris, you know, if you want to predict, you know, how we'll make that decision a year from now,
Oh yeah, my biggest, you know, my, my first thought on that is is that, you know it's yes, they are 3 separate studies but they're, but they're part of, you know, 1 Grandeur study and so it would seem to make sense to to release them all at once. But but I'll be honest with you, we haven't really discussed that.
Perfect. Thank you very much again.
Thank you. Our next question, comes from William Pickering of Bernstein. Your line is now open.
Hey guys, uh, congrats on the progress and thank you for taking my question. It's about your dn1 program. At your muscle R&D Day last year. You indicated, you were planning to dose up to 12 MP in that initial study. Um, my understanding is the highest dose under the current protocol is 6, mpk. And that's unchanged from when syrup to licensed the product last November, uh, is my understanding correct? And if so, what was the rationale for reducing that Max dose versus the prior plan and for having a lower Max dose than the fshd study? Thank you.
So we we still can go up to 12 weeks per kid in the uh the current study, the dm1 study.
Thank you.
1 moment for your next question.
Our next question comes from Madison Elsa of B Riley. Your line is now open.
Hey, hey guys, uh, congrats on the quarter and thanks for taking our questions. Uh, I guess maybe going back to obesity. Uh, given that the the ends inside the, the sample size,
I I guess uh is it your assumption that any statistical conclusions are achievable? Or is that kind of precluded here and just assuming a competitive muscle sparing weight loss? Uh,
is it is achieved? Where do you think you need to land on frequency of dosing to be competitive? Given there are other muscle sparing, uh, candidates being developed, including other srna candidates, thanks.
Sure so this this Phase 1 Study is really um hypothesis generating. There's not a empowering necessarily that goes into cohort size. I think the effect size that we would see, from this study would be used to power, a subsequent, study down the road. Um, and then, in terms of frequency, you know, we're looking at at the most frequent, probably quarterly dose Administration.
So I I'm not sure if there's um anything out there that can match that frequency uh, to date and certainly not that the GOP ones at least not that. I've seen that and some of the muscles staring at molecules, are are probably more frequent than that. So, you know, we're looking at quarterly to every 6 months.
Beyond that. I don't really see any benefit to uh, even less frequent dosing. So I think we're in pretty good place in terms of
Quarterly dosing.
Got it. That's very helpful. Thanks.
Thank you.
Our next question comes from Morgan Lamberti of Goldman's.
Your line is now open.
Hi, thank you for taking our question. This is Morgan on for Andrea Newkirk.
Um, kind of going back to obesity. Um, and specifically Arrow. Elk 7, can you speak more to how you're delivering srna to add a add up a sites and then recognizing that it is not been explored in humans what gives you confidence in the safety profile? Um what potential risks? Could you see in this targeting and is there a good loss of function data out there for us to to see? Thank you.
Sure. Yeah. See if we can hit all of those maybe in Reverse orders, they're, they're they're our data on loss of function at Elk 7 loss of function carriers. We know there are at least a few homozygous walking around that. Um, it seems that it did not have any issues. Then, of course, there's a lot of heteros L7 loss of function carriers, that seem otherwise, phenotypically normal for the state,
Protected from things like type 2 diabetes and had an improved.
Body composition improved BMI. Adjusted waist to hip ratio at the molecule itself that is used as a
Live and targeted approach, that's selected for adapost tissues at a, at a precise. So that there is a Lian driven approach, that's facilitating uptake of, uh, the srna into the cell.
And then beyond the human genetic data. What gives us Confidence from a safety standpoint, to start the study is, of course, all the non GOP and GOP, tox studies that we've done in non-human primates and and in rodent species, and of course, in those, we go up to doses. Many multiples of the doses, we plan to use in the clinical trial and those are all completed without any dose, limiting toxicity. So I think we're in a pretty good position. As far as safety goes, that is going into this space wants to
awesome. Thank you so much.
Thank you.
This concludes the question and answer session, I would now like to turn it to Chris ansalon CEO for closing remarks.
I think you all for joining us today and I wish you all uh uh a good end of the summer and we will see you next quarter.
Thank you for your participation. In today's conference, this does conclude the program. You may now disconnect