Q3 2025 Nektar Therapeutics Earnings Call
Speaker #2: Hello and thank you for standing by . Welcome to the NEKTAR THERAPEUTICS . Third quarter 2020 Financial Results conference call . At this time , all participants are in a listen mode .
Speaker #2: After the speaker's presentation , there will be a question and answer session . Please be advised that today's conference is being recorded . I would now like to hand the conference over to Vivian Wu from Nectar Investor Relations .
Speaker #2: To kick things off , please go ahead .
Speaker #3: Thank you . Crystal , and good afternoon , everyone . Thank you for joining us today . Today you will hear from Howard Robin , our President and Chief Executive Officer , Doctor Jonathan Zalevsky .
Speaker #3: Our chief Research and Development Officer . And Sandra Gardiner , our Chief Financial officer , Doctor Mary Tagliaferri , Chief Medical Officer will also be available during the question and answer session .
Speaker #3: On today's call , we expect to make forward looking statements regarding your business , including statements regarding the therapeutic potential of and future development plans for Westpac .
Speaker #3: Aldesleukin . The timing and plans for future clinical data presentations and other statements regarding the future of our business . Because forward looking statements relate to the future , they are subject to uncertainties and risks that are difficult to predict and many of which are outside of our control .
Speaker #3: Our actual results may differ materially from these statements . Important risks and uncertainties are set forth in our latest form 10-q . Available at sec.gov .
Speaker #3: We undertake no obligation to update any of these forward looking statements , whether as a result of new information , future developments or otherwise .
Speaker #3: A webcast of this call will be available on the IR page of Nafta's website at napster.com . With that said , I would like to hand the call over to our president and CEO , Howard Robin Howard .
Speaker #4: Thank you , Vivian , and good afternoon , everyone . Before I start with remarks for the quarter , I'd like to take a minute to welcome Doctor Mary Tagliaferri back to the company who was recently rejoined us as Chief Medical officer after a need to step away for personal reasons .
Speaker #4: Earlier this year . Mary was instrumental in the design and execution of our successful phase two program , and atopic dermatitis , and we are so fortunate that she has now rejoined us as we prepare for the initiation of the phase three program next year .
Speaker #4: I'd also like to thank Brian Kotzin for his help serving as the interim CMO during the period . Brian has worked with us for nearly ten years , and we are grateful that he will continue to serve as a medical consultant this quarter and year to date .
Speaker #4: We've remained laser focused on pursuing regulatory T cell science across our pipeline and preparing to advance our lead program . Respec Aldesleukin , also known as Respec , into phase three development .
Speaker #4: Our pipeline programs are focused on stimulating tregs in different ways to restore the proper balance between T effector cells and T regulatory cells , and achieve homeostasis in the immune system .
Speaker #4: The data in atopic dermatitis reported in June and presented at Aedv 2025 for Respec , represented a powerful translation of the scientific discoveries that led to an understanding of the importance of tregs and to the first demonstration of their clear clinical efficacy in autoimmune disease .
Speaker #4: The Nobel Prize in Physiology or Medicine was recently awarded for these discoveries that established Foxp3 positive tregs as key enforcers of immune tolerance .
Speaker #4: We're very humbled that the Nobel Committee included the publication of the phase one B data for respect in atopic dermatitis and psoriasis , as support in the background documents for this award .
Speaker #4: The recognition of respect was truly an honor and speaks to the journey that our scientists and clinicians have traveled over the years to turn important scientific discoveries into real potential medicines for patients .
Speaker #4: Our approach with respect and stimulation of tregs is highly differentiated in the field . We believe this is why we have been able to uniquely generate meaningful and robust clinical data that clearly support continued development of this novel modality .
Speaker #4: Respect was designed to closely mimic the way tregs in our own immune system work to resolve inflammation . It's construct gets closest to emulating natural human biology .
Speaker #4: this through il2 agonism with native sequence IL two receptor interactions and a validated chemistry approach . Pegylation that has Achieving over two dozen approved biologics at the 2025 Aedv Congress in September .
Speaker #4: We presented compelling results from the 16 week induction period of the 400 patient resolved AD study of respect in moderate to severe atopic dermatitis .
Speaker #4: These data showcased the clinical differentiation that could be achieved with this novel MOA and Jay-Z will touch on this later in the call , and this weekend at the 2025 American College of Allergy , Asthma and Immunology Annual Scientific Meeting , we will present data from a preplanned analysis of atopic dermatitis patients from the resolved AD study , who also had a history of asthma .
Speaker #4: These data provide further basis for differentiation of respect , recently approved and in development . IL 13 selective pathway blockers and ox40 pathway blockers have shown limited potential to help the asthma symptoms in patients with both atopic dermatitis and asthma , which is a comorbidity in 25% of all atopic dermatitis patients .
Speaker #4: And so we're very excited about these new data in Q1 . We will present 52 week maintenance and escape arm data from the resolved ad study .
Speaker #4: In atopic dermatitis . The maintenance ARM data in particular , will be an important look at continued treatment with Peg in patients who have established an easy 50 response at the end of 16 weeks of induction treatment , there remains a need for novel mechanisms beyond those available currently in the treatment landscape .
Speaker #4: For atopic dermatitis patients in the US , there were over 15 million people with moderate to severe atopic dermatitis and fewer than 10% are receiving biologic treatments for this chronic skin disorder .
Speaker #4: With many patients not responding well to the existing agents . We believe that this market will grow with the adoption of novel mechanisms .
Speaker #4: As we've seen with the induction of new mechanisms in the evolution of psoriasis market , we expect to hold an end of phase two meeting with the FDA before the end of this year to review our phase three plans for respite in moderate to severe atopic dermatitis .
Speaker #4: Importantly , in December , we planned we we plan to present the top results from the phase two resolve AA study in patients with alopecia areata .
Speaker #4: This study enrolled approximately 90 patients with severe to very severe atopic alopecia areata with strong phase two results in the dermatological setting of atopic dermatitis , where optimistic about the second dermatological setting for respect , nearly 7 million people in the US have or will develop alopecia areata in over a million of these patients have severe to very severe disease , according to the 2023 population based cohort study .
Speaker #4: Patients with severe to very severe alopecia have limited treatment options . The only FDA approved systemic treatments for alopecia areata are Jak inhibitors , which carry multiple well-known black box warnings and are associated with high relapse rates upon discontinuation .
Speaker #4: In a 2024 survey of 131 US based board certified dermatologists , a majority of physicians said they were uncomfortable prescribing a Jak inhibitor , and more than half of these physicians reported they would try alternative therapies prior to prescribing a Jak inhibitor .
Speaker #4: With this backdrop , respect could be introduced as the first biologic in the setting of alopecia areata , representing an additional billion dollar market opportunity .
Speaker #4: And so we look forward to these upcoming results from the 36 week treatment period of the resolved AA study expected in December of this year .
Speaker #4: In immunology . Our partner , Trialnet recently initiated the phase two study of Peg in type one diabetes . This study , which is funded and sponsored by Trialnet , will evaluate Peg in new onset stage three type one diabetes patients .
Speaker #4: JS will update you on our other programs as well as our lead pipeline antibody a Tnfr2 agonist that has a unique tissue specific Treg and Breg stimulator profile because of its monomeric activity , we're now building a bispecific program based upon this mechanism , which combines it with with validated antibody targets in immunology .
Speaker #4: Our goal is to advance one of these antibody programs into the clinic next year . And with that , I'd like to turn the call over to Jay-Z to review more details on Peg's ongoing phase two studies and our early pipeline programs .
Speaker #4: Jay-Z thanks Howard, and thank you to everyone on the call for joining us today.
Speaker #5: Begin , I'll remind you that earlier this year , the resolve Phase two B results demonstrated the promise of Nektar's novel approach to the Il2 pathway .
Speaker #5: The global study randomized 393 patients with moderate to severe atopic dermatitis to receive subcutaneous treatment with three doses of Peg , a high dose of 24 microgram per kilogram every two weeks , a middle dose of 18 microgram per kilogram every two weeks , and a low dose of 24 microgram per kilogram every four weeks , or placebo every two weeks .
Speaker #5: For an induction period of 16 weeks . Following week , 16 Respec treated patients who achieved easi reductions of 50% or greater were rerandomized to continue at the same dose level on a Q4 week or Q12 week regimen for an additional 36 week maintenance period .
Speaker #5: In our June data disclosure , we reported that the study achieved statistical significance on the primary endpoint at week 16 for mean percent change in Easi score from baseline for all peg arms versus placebo .
Speaker #5: And the study achieved statistical significance for key secondary endpoints at week 16 of disease reduction , including Easi 75 , easy 90 itch enters the vigor and BSA .
Speaker #5: Additionally , we have yet to see a plateau in the efficacy response in the Peg treatment arms . This study is currently ongoing with two additional upcoming data readouts that Howard mentioned .
Speaker #5: The first will be the 36 week maintenance study results , which compare treatment with Peg at either one month or three month dosing intervals out to a full year , which would be the intended maintenance based dosing regimens .
Speaker #5: Following the 16 week induction period . And the second readout will be the one year off treatment data expected in the beginning of 2027 , which will measure the potential remittive effect of Peg in atopic dermatitis .
Speaker #5: In the meantime , we continue to add to the compelling data set from the resolve ad study , including the data we shared from the escape arm of the trial .
Speaker #5: At this year's Eadv Congress . As a reminder , the study design allowed for patients who originally received placebo in the 16 week induction period and achieved less than Easi 50 at week 16 to enter into an open label treatment escape arm to receive the high dose Peg regimen for a treatment period of up to 36 weeks , the data presented at Aedv demonstrated a deepening of responses in these patients with continuous treatment with Peg and support .
Speaker #5: A 24 week induction period for our phase three program . As Howard stated earlier , we are presenting additional data in patients with asthma from resolve AD in the late breaking oral presentation at the ACR meeting being held in Orlando , Florida this weekend .
Speaker #5: In addition to the asthma data that I'll discuss in a moment , that presentation will also give an update on the placebo crossover data .
Speaker #5: We're now all but one patient have crossed 24 weeks of treatment with 24 microgram per kilogram peg Q2 weeks . We will also cover additional endpoints such as EZ 90 and itch NRS .
Speaker #5: In addition , the presentation will show a forest plot demonstrating the consistency of respect , efficacy across multiple subgroups . This important finding prepares us for phase three .
Speaker #5: Given that 1 in 4 patients with atopic dermatitis also have asthma , we designed the study in advance to evaluate its effect on symptoms of asthma using the validated five point asthma Control questionnaire , also known as the Acq five .
Speaker #5: In these data, we include a pre-specified exploratory endpoint for the subset of patients in RESOLVE AD who also had asthma, including those with moderate and uncontrolled asthma.
Speaker #5: At baseline , the ability to improve comorbid conditions is a substantial factor in clinical treatment decisions for atopic dermatitis and could expand the potential market opportunity for respect in this setting , we know that beyond dupixent , neither trailer Nomad nor Lebrikizumab has been able to show an improvement in asthma symptoms in patients with atopic dermatitis .
Speaker #5: And this extends to the Ox40 programs in late stage development as well . And now turning to alopecia areata , we are on track and look forward to reporting data from the phase two study in December of this year .
Speaker #5: A positive outcome here would reinforce the potential of Peg to provide a completely new treatment paradigm for patients with chronic dermatological diseases . The resolve AA trial was initiated in March 2020 for a total of 94 patients with severe to very severe alopecia areata who have not received a Jak inhibitor or other biologic were randomized to two different dose regimens of respect 24 microgram per kilogram every two weeks , and 18 microgram per kilogram every two weeks , or placebo .
Speaker #5: Patients were recruited across approximately 30 sites globally , with two thirds of patients enrolled in Europe and the rest from North America . As a reminder , patient eligibility for this study was determined using the Salt score .
Speaker #5: Both screening and randomization . Patients who experienced an unstable course of alopecia areata over the last six months per investigator assessment were excluded from the study , and patients with diffuse alopecia and other forms of alopecia were also excluded .
Speaker #5: The primary efficacy endpoint of this study will evaluate mean percent change in the severity of alopecia tool , or Salt score . At the end of the 36 week induction period .
Speaker #5: Secondary endpoints include proportion of patients achieving Salt 20 , which is an absolute Salt score of less than or equal to 20 . Mean percent improvement in Salt score at other assessed time points and proportion of participants with greater than or equal to 50% reduction in Salt score at week 36 and other assessed time points .
Speaker #5: Importantly , Salt 20 , the responder analysis is also the established regulatory endpoint for phase three trials . As Howard mentioned , the only available systemic therapies that are FDA approved for the treatment of alopecia areata are Jak inhibitors , which contain a number of black box warnings and many patients experience hair loss after treatment cessation .
Speaker #5: With the limited treatment options available in alopecia areata , we believe there is opportunity for a novel mechanism like respect , especially when therapeutic is shown to be safe and well tolerated .
Speaker #5: When comparing the outcomes from resolve AA to the approved Jaks , we see low dose olumiant as the appropriate benchmark in its two phase three trials .
Speaker #5: The approved two mg dose of illuminate showed that 15 to 16% of patients achieved salt , 20 on the placebo adjusted basis at week 36 , and the mean improvement in Salt scores from baseline was 24 to 26% on a placebo adjusted basis .
Speaker #5: Note that the placebo response rate in these trials is relatively low , at 3 to 5% . For the Salt 20 endpoint , and 4 to 9% on the mean reduction endpoint .
Speaker #5: Because of our differentiated mechanism of action compared to the Jak inhibitors and our safety profile , we see a very clear market opportunity for respect in alopecia areata .
Speaker #5: If respect achieves these benchmarks , we look forward to sharing the top data from the 36 week treatment period of the resolve AA study in December , and defining the potential for respect in this new indication .
Speaker #5: Similar to atopic dermatitis with positive results from phase two , we would move very quickly into phase three preparations , taking advantage of our fast track designation in the alopecia areata indication , a quick few words on type one diabetes .
Speaker #5: Another autoimmune disease where respect has great potential as a T regulatory mechanism , we believe Peg can potentially slow the progressive loss of insulin producing beta cells , which are the target of the patient's overactive immune cells in this disease .
Speaker #5: As Howard mentioned, TrialNet has initiated and is funding an investigator-sponsored Phase 2 clinical trial evaluating Peg in 66 patients with new-onset type 1 diabetes.
Speaker #5: Lastly , on our pipeline progression , Nektar 0165 , our Tnfr2 agonist remains on track . This molecule has very high specificity for signaling through Tnfr2 on Tregs to enhance and optimize their ability to regulate the immune system next year .
Speaker #5: 165 is also shown that a strong signal can be generated through a single arm monovalent antibody , making it a perfect candidate for inclusion in bispecific and trispecific constructs .
Speaker #5: Our goal is to advance one of these antibody programs into the clinic next year . We look forward to sharing more on these sophisticated antibody engineering programs in future earnings calls .
Speaker #5: And I'll now turn it over to Sandy for the financials . Sandy .
Speaker #6: Thank you . Jay-Z . And good afternoon , everyone . On today's call , I'll briefly review our quarterly financials and share updates to our financial guidance for 2025 .
Speaker #6: We ended the third quarter of 2025 with $270.2 million in cash and investments , and with no debt on our balance sheet , as discussed in our Q2 earnings call , this end of third quarter cash balance includes the completion of the secondary public offering in July , with net proceeds of approximately $107 million .
Speaker #6: It also includes additional net proceeds of $34.3 million we raised in September from our existing ATM facility . We now expect to end the year with approximately $240 million in cash and investments , up from our prior guidance of 100 to 185 million .
Speaker #6: This increased year end guidance also includes 38.3 million of net proceeds from additional sales of our ATM facility in October , based upon our higher year end cash balance , we are extending our cash runway guidance into the second quarter of 2027 .
Speaker #6: Now , turning to the income statement , our non-cash royalty revenue was $11.5 million for the third quarter of 2025 . We still expect our non-cash royalty revenue to total approximately $40 million for the full year .
Speaker #6: Our R&D expense was $27.3 million for the third quarter of 2025 , and we still anticipate full year R&D expense to range between 125 and 130 million , including approximately 5 to $10 million of non-cash depreciation and stock based compensation expense .
Speaker #6: Our DNA expense was $16.1 million for the third quarter . We still expect G&A for the full year of 2025 to be between 70 and 75 million , including approximately 5 to 10 million of non-cash depreciation and stock based compensation expense .
Speaker #6: Non-cash interest expense for the third quarter was $6 million , and we still expect non-cash interest expense for the full year to total approximately $20 million .
Speaker #6: Our non-cash loss from equity method investment was half $1 million in the third quarter of 2025 , and we still expect non-cash loss of approximately $10 million for the full year 2025 .
Speaker #6: As an equity investor in Gannett Biochem , we have no commitment to contribute cash to Gannett . Our net loss for the third quarter was $35.5 million , or $1.87 .
Speaker #6: Basic and diluted net loss per share . And as I stated earlier , we now expect to end the year with approximately $240 million in cash and investments with our cash runway extending into the second quarter of 2027 .
Speaker #6: Finally , as we head into our December data reporting , we intend to enter into a quiet period for the month of December until we report the top line results for the respect Alopecia study .
Speaker #6: And with that , we'll now open the call for questions . Operator .
Speaker #2: Thank you . As a reminder to ask a question , please press star one on your telephone and wait for your name to be announced .
Speaker #2: To withdraw your question , please star one one again , in the interest of time , we do ask that you please limit yourself to one question at this time .
Speaker #2: Please stand by . We compile the Q&A roster . And our first question will come from Yasmeen Rahimi from Piper Sandler . Your line is now open .
Speaker #7: Hi . Congrats on a great quarter . This is Dominic on for Yasmeen Rahimi . We just had a quick question on the upcoming Arcaa data that will be presented .
Speaker #7: Could you help us understand what you hope to report representation in patients with AD and asthma and then moving forward , how would you expect this data to , I
Speaker #7: guess , impact press development in asthma ? Thank you .
Speaker #4: Well, let me, I'll have Jay-Z answer that. But I would tell you that at this point, we're not pursuing an asthma indication.
Speaker #4: I think however , it's I think it's important to recognize the the that in atopic dermatitis , the fact that we have an important drug that potentially solves that comorbidity issue is , is very exciting .
Speaker #4: And as I said earlier , 25% of the patients who have atopic dermatitis . Atopic dermatitis also have asthma . As a comorbidity .
Speaker #4: So I think it's a very important component of differentiating respect . Although we don't have a plan to run an asthma study . Jay-Z , would you like to help with the rest of the question ?
Speaker #5: Sure . Yeah . Thanks for the question , Dominic . So at the Acaai presentation , we are presenting the results of a preplanned , exploratory analysis that was included in the study .
Speaker #5: There's a validated questionnaire instrument that it's like a like a patient reported outcome around that . It's Cq5 , which stands for that asthma control questionnaire .
Speaker #5: And with that you can assess the comorbidity symptoms of asthma in patients that have both atopic dermatitis as well as asthma . And that allows you to look at the total sort of improvement in the AQ five scores over time .
Speaker #5: But it also lets you isolate on patients that have more severe , for example , uncontrolled asthma at baseline , which for the and that's a subset of people that have higher scores on AQ five at baseline .
Speaker #5: For us this is really interesting because like we discussed , roughly 25% of patients have that . So roughly 100 people in our study also had asthma in addition to atopic dermatitis .
Speaker #5: And this allows us to assess the effect of Peg on asthma control and even potentially the improvement of those asthma symptoms in patients that also had atopic dermatitis.
Speaker #5: So one of the things that's so important about that is that when you are faced with treatment decisions as a physician . And you know , you have patients with atopy and atopy constantly includes other organs , that's why it's such a high proportion of atopic dermatitis .
Speaker #5: Patients also have asthma that starts to influence some of the treatment decisions right now , dupee is really the drug that's that's gone to for people with comorbidity as Duppy has demonstrated , activity in both asthma and atopic dermatitis and in patients that express both symptoms as well as each indication separately .
Speaker #5: And that's really likely , you know , with the il4 component of its mechanism . But the other agents in the class approved atopic dermatitis don't have nearly the level of effect that Duppy does .
Speaker #5: So this is a differentiating element of the Treg mechanism of respect . And we do think differentiates respect further from the other molecules in the class and the other molecules in development , as well as the approved agents like as IL 13 selective antagonists and the Ox40 classes , as well .
Speaker #5: And we think is something that is , you potential to really further build upon with respect and something that will be , exploring and thinking a lot about in the future , both in the setting of the comorbidity .
Speaker #5: And as Howard said , even beyond next , Eleanor ,
Speaker #7: Thank you .
Speaker #2: Thank you . Our next question will come from Julian Harrison from Btig . Your line is open .
Speaker #8: Hi . Thank you for taking the questions and congrats on all the recent progress . It looks like you've had a few months now to socialize with the medical community .
Speaker #8: The initial resolved results and potential here . I'm wondering if you have a good sense . Now for the level of interest for a therapy that potentially has a truly remittive effect .
Speaker #8: To what extent do you think that could emerge as a differentiator for respect in atopic derm ? And then switching to alopecia areata ?
Speaker #8: Jay-Z I heard your comments around the low dose magnitude of efficacy , potentially setting the bar . Do you see maybe an opportunity for , you know , use if efficacy is even lower than that ?
Speaker #8: Just given how presumably safe raise peg is potentially free of boxed warnings compared to Jak inhibitors ?
Speaker #4: Oh , Julian , I'll take the first part of the question . Look clearly this mechanism , the Treg mechanism has received a lot of attention , especially in the Nobel Prize in Physiology or Medicine .
Speaker #4: And I think given this very strong data , we have an atopic dermatitis and the cross , you know , the rescue data or the escape arm data , I should say , where patients who failed failed to see any response on placebo did exceptionally well when they were crossed over to drug .
Speaker #4: I think that's incredibly compelling data . And I we're very proud of that . The combination of that data with what we now see in the comorbidity of asthma , I think sets apart respect from a number of different drugs in treating atopic dermatitis .
Speaker #4: So , yes , to answer your question more directly , there's a lot of interest in it . There's a lot of inbound interest in it .
Speaker #4: And I think it's going to have very good prospects . I'll let Jay-Z handle the rest of the question .
Speaker #5: Yeah . Thanks , Howard . And Julian . So , you know , I mean , in the context of the benchmarks . I think what's really important is that respect has the potential to be a truly differentiated mechanism in alopecia areata by numerous factors .
Speaker #5: And one of those is especially given its safety profile right now , there are no approved biologics in the alopecia areata space , and there's really been no therapy that's demonstrated like a sustained treatment effect .
Speaker #5: And what I mean by that is like even even a short term interruption in a Jak course can cause hair thinning . It's a really quick to wear off .
Speaker #5: And so you have the ability to address so many features that both affect the disease . And then the the convenience factor for the patient .
Speaker #5: And substantially the comfort level for the physician in a drug that doesn't have a black box warning , which is one of the issues in limitations of Jak inhibitors , there's no question that those are great drugs for reducing inflammation and reducing inflammation quickly .
Speaker #5: They're just very difficult drugs to take for a long period of time . And these are chronic conditions . So it's really the challenge with the drug like that .
Speaker #5: But with respect you can turn that that whole problem on its side . And we have done a lot of market research . We've tested the profile and the profile of low dose illuminate .
Speaker #5: You know , we find is very competitive given all of the other elements , features of the mechanism of action and the differentiated safety profile .
Speaker #5: And we know that there's space there to your point , Julian . You know , so but we're using that as a as a reasonable kind of proxy benchmark for now .
Speaker #5: It is an approved drug and an approved dose . But there is some space around that . To your point . Thanks .
Speaker #8: Excellent . Thank you . That's all very helpful .
Speaker #2: Thank you . Our next question will come from Jay Olson from Opko . Your line is open .
Speaker #9: Oh , hi . This is John Jay . Thanks for taking the question . And congrats on the progress . Maybe speaking to the AA , I'm just wondering how fast you can maybe start the phase program .
Speaker #9: And are you planning to , you know , move the program by yourself or partnership if the December data is positive . And I'm also wondering in the space to be 80 , study , are there any patients have alopecia areata comorbidities .
Speaker #9: And if so , any color you can share on those patients ? Thank you .
Speaker #4: Well , I think I got I think the first part of your question , I didn't hear it all clearly , but I think the first part of your question , I'll let Jay Z take the second part .
Speaker #4: The first part was when do we think we could start a study in alopecia areata ? I think , you know , bending on the data that we receive in December , we've we've certainly would look forward to starting it next year .
Speaker #4: I think it's I think it's important because as we talked about , the only current therapy is Jak inhibitor . And they come with lots of concerns and warnings .
Speaker #4: And as I as I did describe that at a physician surveys that we've conducted , physicians are somewhat reluctant to to use a Jak inhibitor to treat alopecia areata , given the given the safety concerns .
Speaker #4: So I think if we have a new modality to treat such a very serious disease and a condition that causes extreme depression in people , I think it could be very , very important .
Speaker #4: And consequently , we do plan to start that study next year . I'll let Jay's comment on the rest .
Speaker #5: Yeah . Thanks , John . So so we did look at multiple comorbidities in the atopic dermatitis phase two study . Asthma was by far the largest patient population .
Speaker #5: As I mentioned , you know , roughly 100 people had both atopic dermatitis and asthma in that study . And they'll be presented at Acaai this weekend .
Speaker #5: In terms of alopecia . Also look at vitiligo , for example , very , very few people . So really not not a large enough patient population to isolate out as a subgroup like like a handful , a few people in alopecia that had both both of the diseases .
Speaker #5: Obviously our phase two B results in alopecia , which read out next month . I mean , that is by far a more definitive data set , right ?
Speaker #5: Much , much larger sample size . Obviously , a patient population enrolled with that . Is their primary disease , you know , and then of course , we'll be looking at the treatment effect in that patient population reported next month .
Speaker #5: Thanks .
Speaker #9: Thank you .
Speaker #2: Thank you . Our next question comes from Chacha Yang from Jefferies . Your line is open .
Speaker #10: Hi . This is Chacha on for Roger song . I was wondering , in addition to low dose , are there any therapeutics that are in development ?
Speaker #10: Biologics for alopecia that you think would be an appropriate benchmark ? And then my second question is , are there any il2 specific studies that you think could provide breakthrough to raise peg in alopecia ?
Speaker #10: Thanks .
Speaker #4: Jay-Z you want to .
Speaker #5: Cover that ?
Speaker #4: Yeah . Hi .
Speaker #5: Sure . Hey , yeah . So , yeah , there are , you know , a couple of biologics in development for alopecia .
Speaker #5: And , you know , we discussed them like an IL seven receptor . And other kinds of agents . So I , you know , I think that those there are some earlier data sets our goal is we're doing a much , much larger study than those earlier programs as we described .
Speaker #5: You know , 94 people were enrolled in randomized in the phase two b alopecia study that we're doing . We also have multiple doses .
Speaker #5: So a much larger study that gives a chance to really assess the treatment effect , which I think is going to be more informative than a lot of the single arm or much , much smaller studies that have been done to date .
Speaker #5: But it certainly an area that people are exploring . Tregs remain a very important mechanism . You know , that is is invoked from all a lot of translational studies in patients with alopecia areata .
Speaker #5: We know that there are low levels in deficiencies in Treg function . We also know Tregs are necessary for hair growth and for hair moving through the hair growth cycle .
Speaker #5: And the actual anagen phase that actually is associated with the elongation of the hair . Once it attaches down at the root . Actually requires Treg signaling to the stem cell compartment .
Speaker #5: So so we know that those are multiple key mechanisms . And as one of the big reasons why we're so excited in conducting this study , that will be reading out the top line data for next month .
Speaker #5: And then in terms of IL two specific studies , there have only been a few studies that have been published with IL two .
Speaker #5: One was a case study and one was a small randomized study. The main situation is low dose. IL-2 is really not a good proxy for respect.
Speaker #5: You know , with respect we induce such a higher amount of tregs much , much higher than low dose IL two can never achieve a much greater duration of Treg elevation from a given dose , and the ability to treat for a very long time .
Speaker #5: As you know , we've now treated patients for over a year . For example , for , you know , a 52 week period in the phase two B study in atopic dermatitis .
Speaker #5: So it's definitely a surrogate in the sense of a Treg elevating agent . But really respect substantially exceeds anything that low dose IL two has been able to present across multiple indications .
Speaker #5: Thanks .
Speaker #10: Thanks so much for the color. That's super helpful.
Speaker #2: Thank you . Our next question will come from Mayank Montani from B Riley Securities . Your line is open .
Speaker #11: Yes . Good afternoon . Thanks for taking my questions and congrats on a productive quarter on the alopecia topline data analysis . Would you have any off treatment responder rate ?
Speaker #11: You plan to report on ? Given some patients may have been past that 36 week treatment period and if you could remind us that there's an escape arm option here for the placebo non-responders to crossover , obviously , you know , wonder from your experience , the peak efficacy , you know , from the data you didn't get until , you know , 24 or 48 , 44 weeks , even so , just wonder , what's your plan to assess , efficacy increases beyond that 36 week period ?
Speaker #11: What's the kind of plan there ? And then I have a quick follow up . Can . .
Speaker #5: Sure . Yeah . So so firstly in the the kind of information , you know , that we would present at the , at the December we'll be presenting data from the 36 week induction period .
Speaker #5: You know , in the study , the primary endpoint is the mean percent reduction in Salt score from baseline . And then the key secondary endpoints that are really , really meaningful is the proportion of people that achieve the Salt 20 .
Speaker #5: And also cell ten . Cell 20 is the registrational endpoint in the US . And cell ten in Europe . And then I mentioned earlier in the presentation also the additional secondary endpoints .
Speaker #5: Some of the time dependent endpoints and some of the proportional increases in kind of hair regrowth , right ? As metrics . And then the other things that kind of round out the baseline demographics , you know , the safety profile , all the all the other things .
Speaker #5: But importantly , Mike . Right , the study is still going to be ongoing . So as you know , the way we designed the study is people that reach week 36 that are experiencing benefits such as hair regrowth , for example , but that have not yet reached a Salt 20 metric .
Speaker #5: They have the opportunity to take an additional 16 weeks of treatment to 52 weeks for a full year . So there's a proportion of people that will be ongoing and also the study design has a 24 week off drug observation period .
Speaker #5: So whenever a patient completes treatment , whether that's at nine months or 12 months , they're then followed for that additional 24 week period of time .
Speaker #5: And that's really designed to assess that . If you grew hair , can you keep hair right . Which is a significant differentiating element from a Jak mechanism of action , where the hair loss is really , really rapid .
Speaker #5: When the drug dosing is stopped . So , so because the study is still ongoing , you know , I mean , it's it's , you know , we can't say yet that the totality but definitely the 36 week endpoint , which is the primary analysis with the entire population crossing the 36 week , is going to be the main subject of that top line presentation .
Speaker #11: Is there any here ?
Speaker #5: Oh no , there's no escape arm in the study .
Speaker #11: Okay . Thank you . And on the auto injector development , you know how far along are you and is that going to be at the start of your phase three study ?
Speaker #11: And is that kind of part of the protocol as you get into the end of phase two ? Discussion . Thanks for taking the question .
Speaker #5: Sure. Yeah. So, the auto-injector development is ongoing, and our goal and plan is to have the auto-injector available at the time of launch of the Phase 3 studies, which will be conducted in the same way.
Speaker #5: The phase two studies were where the drug would be used in a vial . And for us , it's , you know , we maintain that really for speed because this allows us to start the phase three studies as quickly as possible relative to what we presented .
Speaker #5: The topline data in June of this year . And then in terms of your other question , you know , just contextually , you know , at the end of phase two meeting , you really discuss everything in the plan to your Bla .
Speaker #5: So that includes not just the phase three clinical development program . The Registrational and pivotal studies . You know , it also includes the CMC .
Speaker #5: So so yes , you know , we have you presented our plans for the final presentation of the product and the auto injector .
Speaker #5: And then all the work that we do during the phase three studies into the Bla , to have that available for launch .
Speaker #2: Thank you . Our next question will come from Arthur . He from H.C. Wainwright . Your line is now open .
Speaker #12: Hey . Good afternoon . How team ? Sorry . I apologize if the question has been asked before . So , given the readout coming out for the alopecia .
Speaker #12: Jake , maybe . Could you tell us a little bit more like . What's the potential respect can offer compared to . The Jak inhibitor here for alopecia ?
Speaker #12: Patient .
Speaker #5: Yeah , it's a great question . I mean , I think that one of the the situations with the Jak inhibitors and we touched a little bit on this earlier is that they definitely are effective at reducing inflammation .
Speaker #5: If you have common gamma chain uses , multiple cytokines , use any either home or heterodimers of jaks . And it's an important part of the signaling cascade .
Speaker #5: In response to multiple cytokines, Jak inhibitors are well known as effective ways of lowering inflammation quite quickly. However, the challenge with using a Jak inhibitor in any indication where it's approved is that long-term use carries with it some disadvantages.
Speaker #5: Right . So the drugs have black box warnings . They have other significant limitations . They require monitoring . There's just a number of things that make them a little bit more delicate to use .
Speaker #5: And in the dermatology in the dermatological setting , you know , some of those things are a little bit undesirable . So one of the things that respect can offer is if the efficacy profile , as we discussed , you know , reaches a benchmark such as a low dose Jak in , say , the aluminium setting , it already brings with it a completely different , you know , risk profile , right ?
Speaker #5: It would not have a black box warning. It would have a completely different and much, much better safety profile and really has the safety profile.
Speaker #5: That's much more aligned with being a very long term chronic use drug . Also , the potential of being the first biologic in this space gives a real tremendous advantage because that starts to really open access , because we've learned from multiple studies that physicians are not so necessarily excited to try Jaks as a first option for patients with the disease .
Speaker #5: So having another alternative that's available could take a significant , you know , an opportunity advantage . And then the last one is really comes down to that potential of maintenance .
Speaker #5: So Jak inhibitors really lose their effect very quickly . And it can be very psychologically difficult for patients because if you spend weeks and months regrowing hair that you didn't have in a really long time , and then any need to interrupt the Jak , whether it's the safety signal or other reason or liver enzyme elevation or something , then that can lead to loss of all that hair that you've grown , which can further drive the depression cycle .
Speaker #5: That's a component of this disease with respect . There's the potential of maintaining the hair that was grown , having interruptions in drug dosing , not be a problem .
Speaker #5: And that would be completely transformational . So these are all things that we think contribute to a very substantial opportunity for respect and alopecia areata .
Speaker #12: Thanks . So another question is , given the U . Pedersen , the the data there , how should we think about the the primary endpoint for the approval there in the future ?
Speaker #12: Do you think the Sol 20 is still could do the job or we probably should . Looking the ten or even zero there for the future drug for alopecia .
Speaker #5: Yeah . Well I mean the the health authority set the registrational endpoints . Right . And so right now those are , those are defined right as sol 20 in the US and sol ten in Europe .
Speaker #5: But obviously every study measures multiple secondaries . Right ? Including , you know , eyelash including sol zero and so on . So I think that , you know , we leave that in the hands of the of the regulators in terms of efficacy .
Speaker #5: I mean , it's I think everywhere that there are multiple Jak inhibitors approved UPA or Rinvoq seems to always win . Right . It's just consistently produces the greatest amount of efficacy compared when it goes head to head against other agents .
Speaker #5: And and I think we've seen that in multiple indications . Arthur . Right . Not just in this one . It does carry with it a little bit more of a safety profile , which is that bike related .
Speaker #5: Right ? It's more on target and more on target talks . In addition to other things . But I do think as compared to the other Jak inhibitors , the UPA is going to be very important .
Speaker #5: Probably take a significant position against the other Jak inhibitors , but we don't really see that as impacting the biologic . Right . Again , there are numerous indications where biologics and small molecules jaks and non jacks coexist .
Speaker #5: Atopic dermatitis is a great example. In psoriasis, you have the TYK2 mechanism coexisting and others. And you know there's really a large enough patient share.
Speaker #5: And the need for multiple mechanisms that always makes plenty of room for multiple mechanisms in this . In this indication .
Speaker #12: All right . Thank you very much for taking my question .
Speaker #2: Thank you. And we do have time for one last question. Our last question will come from Andy Shea from William Blair.
Speaker #2: Your line is open .
Speaker #13: Well , great . Thanks for taking our questions , Mary . It's great to have you back . So my we have two questions .
Speaker #13: So for the resolve ad study , I believe we spent a lot of time and resources to ensure that the placebo rate is low .
Speaker #13: So so having gotten a chance to review that initiative so that you can be the best positioned for the positive phase three outcome , and then the second question , maybe for Howard , what's your current manufacturing footprint ?
Speaker #13: I figured, given the intense interest in Raise Peg, it would be really nice if you could secure one of those national priority vouchers. Thank you.
Speaker #4: I'll take that . I'll take the second part first . Then Mary can continue . Look , we we are looking at a number of different options there .
Speaker #4: You know , we sold our our pegylation manufacturing facility to Garnett Biotech . But we have a priority position there . And we certainly have , you know , a guaranteed source of of those raw materials .
Speaker #4: And we have a number of different contract manufacturing companies very well known companies that we work with . So I'm not concerned about I'm not concerned about at this point , the ability to manufacture successfully manufacture , raise , peg .
Speaker #4: And we are looking at the vouchers , etc. I will let Mary talk to you about the other part of your question .
Speaker #14: Thanks , Howard . And really great to hear your voice too . Andy . And I'm really happy to be back . I mean , as you said , the data are from resolve AD are very exciting , and I've also had the opportunity to speak to multiple dermatologists since I've been back who are also very excited about the totality of the data .
Speaker #14: The speed of onset , and the excellent safety profile . So it's very exciting to move this forward . And certainly in our phase three program , we have every plan to implement the exact same procedures that we did to minimize the placebo effect .
Speaker #14: And some of those are , of course , ensuring that we have board certified dermatologists participating in our clinical trials . We also make sure that the eligibility criteria is met , both in the screening and right before patients are randomized .
Speaker #14: And so we took multiple actions . Also , you know , in our phase two B , we had a quite large size of our placebo group .
Speaker #14: And we will of course have the same when we proceed forward in a larger phase three study . So we were very pleased that we were able to implement multiple different procedures and activities in order to ensure placebo effect was very low .
Speaker #14: And we believe we will continue to be very successful in our Phase 3 as well. So, we look forward to moving forward.
Speaker #14: We've been doing a lot of planning . We're going to have our end of phase two meeting with the FDA by the end of this year , and so we'll have a clear path forward to a b.l.a .
Speaker #13: Great. Good luck with that. Thanks.
Speaker #14: Thank you .
Speaker #2: Thank you . And this does conclude our question and answer session for today's conference . I'd , I'd like to turn the call back over to Howard Robin for any closing remarks .
Speaker #4: Well thank you Crystal , and thank you everyone for joining us today . And we greatly appreciate your continued support . And I want to thank all of the patients and their caregivers that have trusted and continued to trust Nektar to treat their disease .