Q4 2025 Nektar Therapeutics Earnings Call

March 12, 2026

Operator: Hello, and thank you for standing by. Welcome to the Nektar Therapeutics Q4 2025 Financial Results Conference Call. At this time, all participants are in a listen-only mode. 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 Nektar Investor Relations to kick things off. Please go ahead.

Julian Harrison: Hello, and thank you for standing by. Welcome to the Nektar Therapeutics Q4 2025 Financial Results Conference Call. At this time, all participants are in a listen-only mode. 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 Nektar Investor Relations to kick things off. Please go ahead.

Speaker #1: 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 NEKTAR Investor Relations to kick things off.

Speaker #1: Please go ahead.

Speaker #2: 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, Dr. Jonathan Zalevsky, our Chief Research and Development Officer, and Sandra Gardiner, our Chief Financial Officer.

Vivian Wu: 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, Dr. Jonathan Zalevsky, our Chief Research and Development Officer, and Sandra Gardiner, our Chief Financial Officer. Dr. Mary Tagliaferri, our Chief Medical Officer, will also be available during the Q&A. On today's call, we expect to make forward-looking statements regarding our business, including statements regarding the therapeutic potential of and future development plans for rezpegaldesleukin, 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. Our actual results may differ materially from these statements.

Speaker #2: Dr. Mary Tagliaferi, our Chief Medical Officer, will also be available during the Q&A. On today's call, we expect to make forward-looking statements regarding our business, including statements regarding the therapeutic potential of and future development plans for ResPEG G Aldisleukin.

Speaker #2: 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.

Speaker #2: They are subject to uncertainties and risks that are difficult to predict, many of which are outside of our control. Our actual results may differ materially from these statements.

Vivian Wu: Important risks and uncertainties are set forth in our latest Form 10-Q, available at sec.gov. We undertake no obligation to update any of these forward-looking statements, whether as a result of new information, future developments, or otherwise. A webcast of this call will be available on the IR page of Nektar's website at nektar.com. With that said, I would like to hand the call over to our President and CEO, Howard Robin. Howard?

Speaker #2: Important risks and uncertainties are set forth in our latest Form 10Q available at sec.gov. We undertake no obligation to update any of these forward-looking statements, whether as a result of new information, future developments, or otherwise.

Speaker #2: A webcast of this call will be available on the IR page of NEKTAR's website at nektar.com. With that said, I would like to hand the call over to our President and CEO, Howard Robin.

Speaker #2: Howard?

Howard Robin: Thank you, Vivian. Good afternoon, everyone. 2025 was a pivotal year for Nektar, and we continue to build on this success with significant progress in 2026. In 2023, we unveiled our plans to focus on the advancement of our immunology and inflammation pipeline programs, which center around the biology of T-regulatory cells. In October 2023, we began the first phase 2 study of our novel Treg biologic, rezpegaldesleukin, in patients with moderate to severe atopic dermatitis. In early 2024, we began our second phase 2 study in patients with alopecia areata. Just last year, a third phase 2 study in Type 1 diabetes was initiated with our collaborator, TrialNet, who is funding and sponsoring this trial.

Speaker #3: Thank you, Vivian. Good afternoon, everyone. 2025 was a pivotal year for NEKTAR, and we continue to build on the success with significant progress in 2026.

Speaker #3: In 2023, we unveiled our plans to focus on the advancement of our immunology and inflammation pipeline programs which center around the biology of T regulatory cells.

Speaker #3: In October of '23, we began the first phase two study of our novel T reg biologic ResPEG Aldisleukin in patients with moderate to severe ectopic dermatitis.

Speaker #3: In early 2024, we began our second phase two study in patients with alopecia areata and, just last year, a third phase two study in type 1 diabetes was initiated with our collaborator trial net, whose funding and sponsoring this trial.

Speaker #3: In the second half of 2025, we saw the successful outcome of several years of hard work by our team as we achieved the first positive results from the two phase two B studies of ResPEG and ectopic dermatitis and alopecia areata.

Howard Robin: In the second half of 2025, we saw the successful outcome of several years of hard work by our team as we achieved the first positive results from the two Phase 2b studies of REZPEG in atopic dermatitis and alopecia areata. The results validated that our novel regulatory T cell mechanism could produce clinically meaningful outcomes in two dermatological and inflammatory disease settings. Just last month, we reported on the long-term monthly and quarterly dosing results from the 36-week maintenance portion of REZOLVE-AD in atopic dermatitis. These data showed a significant durability of efficacy that was highly competitive to what's seen with other biologics, and establishes what our novel Treg mechanism is capable of achieving.

Speaker #3: The results validated that our novel regulatory T cell mechanism could produce clinically meaningful outcomes in two dermatological and inflammatory disease settings. And just last month, we reported on the long-term monthly and quarterly dosing results from the 36-week maintenance portion of Resolve AD in ectopic dermatitis.

Speaker #3: These data showed a significant durability of efficacy that was highly competitive to what's seen with other biologics and establishes what our novel T reg mechanism is capable of achieving.

Speaker #3: Monthly or quarterly dosing of ResPEG during the maintenance period showed a deepening of response with increases in easy 75, easy 90, and up to fivefold increase in easy 100 scores.

Howard Robin: Monthly or quarterly dosing of REZPEG during the maintenance period showed a deepening of response with increases in EASI 75, EASI 90, and an up to five-fold increase in EASI 100 scores. Both atopic dermatitis and alopecia areata are inflammatory dermatological diseases that impact a significant number of patients worldwide. In the US alone, there are over 15 million people with moderate to severe atopic dermatitis, and it is estimated that today only 10 to 15% of patients are receiving biologic treatments for this chronic skin disorder. Driven by the rapid adoption of biologics, the atopic dermatitis market is expected to grow to approximately $35 billion by the mid-2030s. Although Dupixent and IL-13s are the predominantly used therapeutics today to treat these patients, about 50% of patients fail to respond or lose treatment effect over time with IL-13-based approaches.

Speaker #3: Both atopic dermatitis and alopecia areata are inflammatory dermatological diseases that impact a significant number of patients worldwide. In the US alone, there are over 15 million people with moderate to severe atopic dermatitis, and it is estimated that today only 10 to 15 percent of patients are receiving biologic treatments for this chronic skin disorder.

Speaker #3: Driven by the rapid adoption of biologics, the ectopic dermatitis market is expected to grow to approximately $35 billion by the mid-2030s. Although Dupixent and IL-13s are the predominantly used therapeutics today to treat these patients, about 50 percent of patients fail to respond or lose treatment effect over time with IL-13-based approaches.

Speaker #3: This leaves a significant opportunity for a novel immune-modulating mechanism like ResPEG to enter the treatment paradigm. And the competitive landscape has recently narrowed, for the late-stage novel method MOAs being advanced to BLA filing.

Howard Robin: This leaves a significant opportunity for a novel immune modulating mechanism like REZPEG to enter the treatment paradigm. The competitive landscape has recently narrowed for the late-stage novel MOAs being advanced to BLA filing. We believe this puts REZPEG in a lead position as a novel MOA, which could offer both a differentiated efficacy and safety profile with a better dosing regimen and the potential to offer patients complete clearance of disease over time. In alopecia areata, there remains a need for an efficacious and safe biologic with a better efficacy and dosing profile. Currently approved JAK inhibitors are effective at regrowing hair in some patients, but they carry a number of drawbacks, and more than half of physicians, and patients are hesitant to use these agents because of the safety risks and the associated monitoring burden they pose.

Speaker #3: We believe this puts ResPEG in a lead position as a novel MOA which could offer both a differentiated efficacy and safety profile with a better dosing regimen and the potential to offer patients complete clearance of disease over time.

Speaker #3: In alopecia areata, there remains a need for an efficacious and safe biologic with a better efficacy and dosing profile. Currently approved JAK inhibitors are effective at regrowing hair in some patients, but they carry a number of drawbacks, and more than half of physicians and patients are hesitant to use these agents because of the safety risks and the associated monitoring burden they pose.

Howard Robin: Importantly, the JAK class has poor durability and nearly all patients lose their hair after treatment cessation. With the 36-week data from REZOLVE-AA establishing a clinical efficacy profile similar to low dose JAK inhibitors in alopecia, we're looking forward to seeing the 52-week data from that study in April. For patients who enter the blinded 16-week treatment extension, we will be evaluating the potential of REZPEG to deepen SALT reductions, including SALT 20 responses. REZPEG's differentiated clinical profile and a safety database of over 1,000 patients treated to date, equivalent to 381 patient years of exposure, provides an exceptionally strong basis for advancing REZPEG into phase 3 studies. In June, we will be randomizing the first patient in the phase 3 studies in atopic dermatitis.

Speaker #3: Importantly, the JAK class has poor durability and nearly all patients lose their hair after treatments cessation. With a 36-week data from Resolve AA, establishing a clinical efficacy profile similar to low-dose JAK inhibitors in alopecia, we're looking forward to seeing the 52-week data from that study in April.

Speaker #3: For patients who enter the blinded 16-week treatment extension, we will be evaluating the potential of ResPEG to deepen salt reductions, including ZOOSALT-20 responses.

Speaker #3: ResPEG's differentiated clinical profile and a safety database of over 1,000 patients treated to date equivalent to 381 patient years of exposure provides an exceptionally strong basis for advancing ResPEG into phase three studies.

Speaker #3: In June, we will be randomizing the first patient in the phase 3 studies in ectopic dermatitis. We now have alignment with the FDA on our phase 3 dose, the 24-week induction treatment period, and other critical phase 3 study design elements.

Howard Robin: We now have alignment with the FDA on our phase 3 dose, the 24-week induction treatment period, and other critical phase 3 study design elements. JZ will review that in a moment. We expect to have the first data from phase 3 in mid-2028 and meet our goal to submit a BLA in 2029. We ended 2025 with $245.8 million in cash and investments and with no debt on our balance sheet. Since year-end, we've also raised approximately $476 million in additional net cash through both a public offering and exercising a portion of our ATM. Our very strong balance sheet now allows us to move quickly into phase 3.

Speaker #3: JZ will review that in a moment. We expect to have the first data from Phase 3 in mid-2028 and meet our goal to submit a BLA in 2029.

Speaker #3: We ended 2025 with $245.8 million in cash and investments and with no debt on our balance sheet. Since year-end, we've also raised approximately $476 million in additional net cash through both a public offering and exercising a portion of our ATM.

Speaker #3: Our very strong balance sheet now allows us to move quickly into phase three. I'll now turn the call over to JZ, who will share more on ResPEG and our other immunology programs.

Howard Robin: I'll now turn the call over to JZ, who will share more on REZPEG and our other immunology programs. JZ?

Speaker #3: JZ?

Speaker #4: Thank you, Howard. To start off, I'd like to comment in more detail on the significant progress we've made with ResPEG that Howard highlighted moments ago.

Jonathan Zalevsky: Thank you, Howard. To start off, I'd like to comment in more detail on the significant progress we've made with REZPEG that Howard highlighted moments ago. REZPEG is a very unique Treg biologic that capitalizes on a critical immune pathway. As a highly selective agonist of regulatory T cells, it is designed to address the underlying immune balance of multiple inflammatory pathways. This past year, we have shown through our phase 2 clinical datasets that REZPEG is truly differentiated as a novel MOA and late-stage biologic candidate with a compelling efficacy profile, and that it can also offer long-term extended dosing frequency. This phase 2 data adds to the 36-week off-drug disease control or remission potential of REZPEG that we demonstrated in the earlier phase 1 trial.

Speaker #4: ResPEG is a very unique T reg biologic that capitalizes on a critical immune pathway. As a highly selective agonist of regulatory T cells, it is designed to address the underlying immune balance of multiple inflammatory pathways.

Speaker #4: This past year, we have shown through our phase two clinical datasets that ResPEG is truly differentiated as a novel MOA and late-stage biologic candidate with a compelling efficacy profile, and that it can also offer long-term extended dosing frequency.

Speaker #4: This phase two data adds to the 36-week off-drug disease control or remitted potential of ResPEG that we demonstrated in the earlier phase one trial.

Speaker #4: And now ResPEG is a phase three ready program, and we have one of the largest safety databases for agents in mid to late-stage development in atopic dermatitis.

Jonathan Zalevsky: Now REZPEG is a phase 3-ready program, and we have one of the largest safety databases for agents in mid- to late-stage development in atopic dermatitis, which is now established in over 1,000 patients spanning about 381 patient years of exposure. In atopic dermatitis, our 16-week induction data reported last June established that REZPEG has rapid onset of key efficacy metrics, separating early from placebo after 1 or 2 doses on EASI 75, EASI 90, and itch relief. Notably, our induction data established REZPEG as the first novel MOA to show strong itch relief in conjunction with skin clearance without the need for topical corticosteroids. We know that itch relief is a major driver of improved sleep scores and better quality of life for patients with atopic dermatitis, and this translated into achieving statistical significance on these patient-reported outcomes in our study as well.

Speaker #4: Which is now established in over 1,000 patient spanning about 381 patient year of exposure. In atopic dermatitis, our 16-week induction data reported last June established that ResPEG has rapid onset of key efficacy metrics.

Speaker #4: Separating early from placebo after one or two doses, on easy 75, easy 90, and itch relief. And notably, our induction data established ResPEG as the first novel MOA to show strong itch relief in conjunction with skin clearance without the need for topical corticosteroids.

Speaker #4: We know that itch relief is a major driver of improved sleep scores and better quality of life for patients with atopic dermatitis, and this translated into achieving statistical significance on these patient-reported outcomes in our study as well.

Speaker #4: At the high dose of 24 microgram per kilogram given every two weeks in induction, we also saw comparable efficacy data for both easy 75 and easy 90 in the moderate and severe patient populations enrolled in the trial.

Jonathan Zalevsky: At the high dose of 24 microgram per kilogram given every 2 weeks in induction, we also saw comparable efficacy data for both EASI 75 and EASI 90 in the moderate and severe patient populations enrolled in the trial. The study was stratified by vIGA baseline scores of 4 and 3, and efficacy was comparable among both these populations. This attribute emerges as a key differentiating aspect from what has been seen with Dupixent treatment. REZPEG has also shown promising positive results in treating atopic dermatitis patients with self-reported comorbid asthma. We reported this data for the ACQ-5 endpoints for REZOLVE-AD last year at ACAAI. Outside of Dupixent, no other approved agent or agent in development has shown the ability to improve atopic dermatitis and comorbid asthma at the same time.

Speaker #4: The study was stratified by VIGA baseline scores of 4 and 3, and efficacy was comparable among both these populations. And this attribute emerges as a key differentiating aspect compared to what has been seen with Dupixent treatment.

Speaker #4: ResPEG has also shown promising positive results in treating atopic dermatitis patients with self-reported comorbid asthma. We reported this data for the ACQ5 endpoints from Resolve AD last year at ACAAI.

Speaker #4: Outside of Dupixent, no other approved agent or agent in development has shown the ability to improve atopic dermatitis and comorbid asthma at the same time.

Speaker #4: In induction, ResPEG resulted in statistically significant and clinically meaningful improvements in ACQ-5 scores at week 16 versus placebo in patients, and a 75% improvement in these scores in patients with uncontrolled asthma at baseline.

Jonathan Zalevsky: In induction, REZPEG resulted in statistically significant and clinically meaningful improvements in ACQ-5 scores at week 16 versus placebo in patients, and a 75% improvement in these scores in patients with uncontrolled asthma at baseline. Approximately one in four atopic dermatitis patients also have comorbid asthma, and REZPEG is the only novel MOA to show improvements in this endpoint. With the 36-week maintenance data reported last month, we demonstrated two additional critical features of REZPEG that differentiate it from approved agents and those in development. First, we saw significant maintenance of efficacy, and we also saw a deepening of response with continued treatment out to 52 weeks, including improvements in EASI 75, EASI 90, itch, and vIGA endpoints. Notably, we saw an up to 5-fold increase in EASI 100.

Speaker #4: And approximately one in four atopic dermatitis patients also have comorbid asthma, and ResPEG is the only novel MOA to show improvements in this endpoint.

Speaker #4: With the 36-week maintenance data reported last month, we demonstrated two additional critical features of ResPEG that differentiated from approved agents and those in development.

Speaker #4: First, we saw significant maintenance of efficacy. And we also saw deepening of response with continued treatment out to 52 weeks, including improvements in EASI 75, EASI 90, itch, and vIGA endpoints.

Speaker #4: Notably, we saw an up to five-fold increase in easy 100, as Howard mentioned earlier, underscoring the potential for ResPEG to give patients complete disease clearance with extended treatment over time.

Jonathan Zalevsky: As Howard mentioned earlier, underscoring the potential for REZPEG to give patients complete disease clearance with extended treatment over time and setting a new benchmark in atopic dermatitis. Second, we established that extended monthly and quarterly dosing could be used as a long-term treatment regimen with REZPEG after inducing responses. As I stated earlier, with over 1,000 patients treated to date and about 381 patient years of exposure, REZPEG has a well-established, long-term, and favorable safety profile. As seen in our reported data, we have generated a differentiated safety profile with no increased risk of systemic adverse events such as conjunctivitis, infection, or malignancy. The REZOLVE-AD data informed our Phase 3 program, and we will start the first pivotal study in June of this year.

Speaker #4: And setting a new benchmark in atopic dermatitis. And second, we established that extended monthly and quarterly dosing could be used as a long-term treatment regimen with ResPEG after inducing responses.

Speaker #4: As I stated earlier, with over 1,000 patients treated to date, and about 381 patient years of exposure, ResPEG has a well-established long-term and favorable safety profile.

Speaker #4: As seen in our reported data that we have generated a differentiated safety profile with no increased risk of systemic adverse events such as conjunctivitis or infection or malignancy.

Speaker #4: The Resolve AD data informed our phase three program, and we will start the first pivotal study in June of this year. Following our end of phase two meeting, we now have alignment on plans for a phase three program to evaluate a single dose of 24 microgram per kilogram twice monthly for a 24-week induction period.

Jonathan Zalevsky: Following our end of Phase 2 meeting, we now have alignment on plans for a Phase 3 program to evaluate a single dose of 24 micrograms per kilogram twice monthly for a 24-week induction period. Patients who achieve EASI 75 or IGA responses will then be re-randomized to monthly and quarterly regimens out to 52 weeks. The design of Phase 3 will be similar to those studies used for registration of other biologics. Our plan is to utilize, as other Phase 3 programs have, the primary endpoint of an IGA-related endpoint required for US registration and an additional EASI 75 endpoint to support EU approval. Our Phase 3 program will evaluate both biologic-naive and treatment-experienced patients. Beyond atopic dermatitis, in December, we also established a proof of concept with the data from REZOLVE-AA for REZPEG in severe to very severe alopecia areata.

Speaker #4: Patients who achieve easy 75 or IGA responses will then be rerandomized to monthly and quarterly regimens out to 52 weeks. The design of phase three will be similar to those studies used for registration of other biologics.

Speaker #4: Our plan is to utilize, as other phase three programs have, the primary endpoint of an IGA-related endpoint required for US registration and an additional EASI-75 endpoint to support EU approval.

Speaker #4: Our phase three program will evaluate both biologic-naive and treatment-experienced patients. Beyond atopic dermatitis, in December, we also established a proof of concept with the data from Resolve AA for ResPEG in severe to very severe alopecia areata.

Speaker #4: We were pleased that these data have been accepted as a late-breaking presentation at the upcoming AAD meeting at the end of March. It is the only data set in alopecia areata that was accepted for presentation in the late-breaking session.

Jonathan Zalevsky: We were pleased that these data have been accepted as a late-breaking presentation at the upcoming AAD meeting at the end of March. It is the only data set in alopecia areata that was accepted for presentation in the late-breaking session. In the REZOLVE-AA study, as we reported in December, REZPEG demonstrated an efficacy response that met our target product profile expectations, which was to achieve efficacy similar to low-dose JAK inhibition at week 36 with every 2-week dosing and maintain a more attractive and favorable safety profile. We believe the data positioned REZPEG as a potential first-in-class biologic in alopecia. As Howard stated earlier, the REZOLVE-AA study also included a blinded 16-week extension for patients who reached week 36 in the study but had not yet achieved a SALT 20 score. We plan to report the data from this treatment extension in April.

Speaker #4: In the Resolve AA study, as we reported in December, ResPEG demonstrated an efficacy response that met our target product profile expectations which was to achieve efficacy similar to low-dose JAK inhibition at week 36 with every two-week dosing.

Speaker #4: And maintain a more attractive and favorable safety profile. We believe the data positioned ResPEG as a potential first-in-class biologic in alopecia. As Howard stated earlier, the Resolve AA study also included a blinded 16-week extension for patients who reached week 36 in the study but had not yet achieved a SALT-20 score.

Speaker #4: We plan to report the data from this treatment extension in April. To that end, we will initiate a quiet period beginning April 1st until we unblind and report the data from the treatment extension.

Jonathan Zalevsky: To that end, we will initiate a quiet period beginning 1 April until we unblind and report the data from the treatment extension. As a reminder, the only available systemic therapies that are FDA-approved for the treatment of alopecia areata are JAK inhibitors, but these contain a number of black box warnings and laboratory monitoring requirements. Nearly all patients also experience hair loss after treatment cessation. With the limited treatment options available in alopecia areata, we believe there's a unique opportunity for a novel immune modulating Treg mechanism like REZPEG to offer attractive dosing as compared to a daily pill and a potentially more favorable safety profile. Following our 16-week treatment extension data, we expect to hold our end-of-phase 2 meeting with the FDA for alopecia areata in Q2 this year.

Speaker #4: As a reminder, the only available systemic therapies that are FDA-approved for the treatment of alopecia areata are JAK inhibitors. But these contain a number of black box warnings and laboratory monitoring requirements.

Speaker #4: Nearly all patients also experience hair loss after treatments cessation. With the limited treatment options available in alopecia areata, we believe there's a unique opportunity for a novel immune-modulating TRAG mechanism like ResPEG to offer attractive dosing as compared to a daily pill and a potentially more favorable safety profile.

Speaker #4: Following our 16-week treatment extension data we expect to hold our end of phase two meeting with the FDA for alopecia areata in the second quarter of this year.

Jonathan Zalevsky: Following that, we plan to share more about our plans for advancing into phase 3. Before I move on to our earlier antibody program, I want to mention our ongoing phase 2 study with REZPEG for type 1 diabetes. This study, sponsored and funded by TrialNet, is evaluating REZPEG in patients with new onset stage 3 type 1 diabetes. Per protocol, patients will be randomized 2 to 1 versus placebo and receive REZPEG every 2 weeks for 6 months. The study is broken into 3 cohorts, beginning with adult subjects ages 18 to 45, and moving into patients as young as 12 and then 8 years of age. We are excited to be working with TrialNet. This consortium of type 1 diabetes specialists in the US also ran the first studies for Tzield, also known as teplizumab, in type 1 diabetes.

Speaker #4: And following that, we plan to share more about our plans for advancing into phase three. Before I move on to our earlier antibody program, I want to mention our ongoing phase two study with ResPEG for type 1 diabetes.

Speaker #4: This study sponsored and funded by TrialNet is evaluating ResPEG in patients with new-onset stage 3 type 1 diabetes. Per protocol, patients will be randomized two to one versus placebo and receive ResPEG every two weeks for six months.

Speaker #4: The study is broken into three cohorts beginning with adult subjects ages 18 to 45 and moving into patients as young as 12 and then eight years of age.

Speaker #4: We are excited to be working with TrialNet. This consortium of type 1 diabetes specialists in the US also ran the first studies for Tizilt, also known as Teplizumab, in type 1 diabetes.

Speaker #4: They have a strong commitment to finding and evaluating new therapies that can help patients with this devastating diagnosis. We believe and expect initial data from the trial that sponsored phase two sometime in 2027.

Jonathan Zalevsky: They have a strong commitment to finding and evaluating new therapies that can help patients with this devastating diagnosis. We believe and expect initial data from the TrialNet-sponsored Phase 2 sometime in 2027. One of the important paradigms of our work is that by creating a first-in-class Treg targeting approach like REZPEG, we've confirmed what we've always felt as immunologists, that Tregs were essential for so many different diseases, and that they could be therapeutically targeted for disease treatment. Based upon low-dose IL-2 and Treg biology, either genetically or assessed clinically, we know that there are so many indications beyond what we're exploring in our current Phase 2 studies that are potential opportunities for REZPEG. These include therapeutic areas such as skin and autoimmune diseases, Th2 such as food allergies or asthma, where we've already seen a signal, and chronic rhinosinusitis.

Speaker #4: One of the important paradigms of our work is that, by creating a first-in-class TRAG targeting approach like ResPEG, we've confirmed what we've always felt as immunologists—that TRAGs were essential for so many different diseases and that they could be therapeutically targeted for disease treatment.

Speaker #4: Based upon low-dose IL-2 and TRAG biology, either genetically or assessed clinically, we know that there are so many indications beyond what we're exploring in our current phase two studies that are potential opportunities for ResPEG.

Speaker #4: These include therapeutic areas such as our skin and autoimmune diseases, such as food allergies or asthma, where we've already seen a signal, and chronic rhinosinusitis.

Speaker #4: It also includes skin disorders such as dermatomyositis and also potentially autoimmune diseases such as Sjögren's syndrome. As we advance, ResPEG in phase three we look forward to the possibility of generating additional proof of concept data in additional indications which could expand the future label for ResPEG.

Jonathan Zalevsky: It also includes skin disorders such as dermatomyositis, and also potentially autoimmune diseases such as Sjögren's syndrome. As we advance REZPEG in phase 3, we look forward to the possibility of generating additional proof of concept data and additional indications which could expand the future label for REZPEG. Moving on to our earlier pipeline programs, NKTR-0165 and NKTR-0166, our TNFR2 agonist and bispecific programs. We expect to present preclinical data from this program at a scientific conference in the second half of 2026. This molecule has a very high specificity for signaling through TNFR2 on T regs to enhance and optimize their ability to regulate the immune system, which we believe could be impactful in multiple sclerosis, ulcerative colitis, vitiligo, and other I&I indications. In the Q1, we announced an academic research collaboration for NKTR-0165 with Dr.

Speaker #4: Moving on to our earlier pipeline programs, NEKTAR 0165 and NEKTAR 0166, our TNFR2 agonist and bispecific programs. We expect to present preclinical data from this program at a scientific conference in the second half of 2026.

Speaker #4: This molecule has a very high specificity for signaling through TNFR2 on Tregs. To enhance and optimize their ability to regulate the immune system, which we believe could be impactful in multiple sclerosis, ulcerative colitis, vitiligo, and other INI indications.

Speaker #4: In the first quarter, we announced an academic research collaboration for NEKTAR 0165 with Dr. Stephen Hauser, a UCSF, to explore the potential role of TNFR2 agonism in the reduction of neurodegeneration and promotion of neuroprotection and cell repair.

Jonathan Zalevsky: Stephen Hauser at UCSF to explore the potential role of TNFR2 agonism in the reduction of neurodegeneration and promotion of neuroprotection and cell repair. The work being funded by UCSF will look at NKTR-0165 in patient-derived B-cell models of multiple sclerosis. We're looking forward to working with Dr. Hauser to inform future development work for this important molecule. Leveraging our learnings from the development of NKTR-0165, we have designed a bispecific molecule called NKTR-0166. This bivalent antibody incorporates a TNFR2 agonist epitope and an antagonist epitope that has been previously validated in the treatment of rheumatology diseases. As a dual agonist antagonist of known pathways, NKTR-0166 has the potential to modify disease pathogenesis in a number of autoimmune disorders. We're planning for IND submission for one or both programs in 2027. With that, I'll now turn it over to Sandy to cover the financials.

Speaker #4: The work being funded by UCSF will look at NEKTAR 0165 in patient-derived B-cell models of multiple sclerosis. We're looking forward to working with Dr. Hauser to inform future development work for this important molecule.

Speaker #4: Leveraging our learnings from the development of NEKTAR 0165, we have designed a bispecific molecule called NEKTAR 0166. This bivalent antibody incorporates a TNFR2 agonist epitope and an antagonist epitope that has been previously validated in the treatment of rheumatology diseases.

Speaker #4: As a dual agonist-antagonist of known pathways, NEKTAR 0166 has the potential to modify disease pathogenesis in a number of autoimmune disorders. And we're planning for IND submission for one or both programs in 2027.

Speaker #4: And with that, I'll now turn it over to Sandy to cover the financials.

Speaker #1: Thank you, Jay-Z, and good afternoon, everyone. On today's call, I'll review our quarterly and full-year 2025 financials and share our preliminary financial guidance for 2026.

Sandra Gardiner: Thank you, JZ, and good afternoon, everyone. On today's call, I'll review our quarterly and full year 2025 financials and share our preliminary financial guidance for 2026. We ended 2025 with $245.8 million in cash and investments and with no debt on our balance sheet. In February, we completed an underwritten public offering for $460 million, resulting in approximately $432 million in net cash proceeds to the company. We also accessed approximately $44 million of net proceeds to date from our existing $110 million ATM facility in 2026. We now have a strong balance sheet to invest in our pipeline and advance our phase 3 program in REZPEG. I will now provide a quick review of our 2025 financials.

Speaker #1: We ended 2025 with $245.8 million in cash and investments and with no debt on our balance sheet. In February, we completed an underwritten public offering for $460 million, resulting in approximately $432 million in net cash proceeds to the company.

Speaker #1: We also accessed approximately $44 million of net proceeds to date from our existing $110 million ATM facility in 2026. We now have a strong balance sheet to invest in our pipeline and advance our Phase 3 program in ResPEG.

Speaker #1: I will now provide a quick review of our 2025 financials. Our revenue was $21.8 million for the fourth quarter and $55.2 million for the full year 2025.

Sandra Gardiner: Our revenue was $21.8 million for Q4 and $55.2 million for the full year 2025. Our R&D expenses were $29.7 million for Q4 and $117.3 million for the full year. Our G&A expenses were $11.2 million for Q4 and $68.7 million for the full year. Our non-cash interest expense for Q4 was $9.8 million and $26.2 million for the full year. Our net loss for Q4 was $36.1 million or $1.78 basic and diluted net loss per share.

Speaker #1: Our R&D expenses were $29.7 million for the fourth quarter and $117.3 million for the full year. Our GNA expenses were $11.2 million for the fourth quarter and $68.7 million for the full year.

Speaker #1: Our non-cash interest expense for the fourth quarter was $9.8 million, and $26.2 million for the full year. Our net loss for the fourth quarter was $36.1 million, or $1.78 basic and diluted net loss per share.

Speaker #1: For the full year of 2025, our net loss was $164.1 million, or $9.73 basic and diluted net loss per share. We are providing very preliminary 2026 guidance on today's call.

Sandra Gardiner: For the full year of 2025, our net loss was $164.1 million or $9.73 basic and diluted net loss per share. We are providing very preliminary 2026 guidance on today's call. The guidance ranges are wide as we are still completing the planning and budgeting activities for the REZPEG phase 3 program. We began investing in start activities for this program last year with production of drug supply and placebo. As Howard stated earlier, we plan to randomize the first patient in June. We expect an updated 2026 budget at that time, and we'll update our financial guidance as necessary. With respect to our 2026 PNL guidance, our non-cash royalty revenue for the full year of 2026 is expected to be between $40 and 45 million.

Speaker #1: The guidance ranges are wide as we are still completing the planning and budgeting activities for the ResPEG phase three program. We began investing in startup activities for this program last year with production of drug supply and placebo.

Speaker #1: And as Howard stated earlier, we plan to randomize the first patient in June. We expect an updated 2026 budget at that time and will update our financial guidance as necessary.

Speaker #1: With respect to our 2026 P&L guidance, our non-cash royalty revenue for the full year of 2026 is expected to be between $40 and $45 million.

Speaker #1: Based on our current forecast, we anticipate that full-year R&D expense could range between $200 million and $250 million, including approximately $5 to $10 million of non-cash depreciation and stock-based compensation expense.

Sandra Gardiner: Based on our current forecast, we anticipate that full-year R&D expense could range between $200 and 250 million, including approximately $5 to 10 million of non-cash depreciation and stock-based compensation expense. We expect G&A expense will decline in 2026 over 2025 to a range of $60 to 65 million. This includes approximately $5 million of non-cash depreciation and stock-based compensation expense. Our full-year non-cash interest expense is expected to be between $30 and 35 million. Additionally, we do not expect any significant gain or loss on our equity method investment in 2026. Lastly, we expect to end 2026 with approximately $400 to 460 million in cash and investments. With that, we'll now open the call for questions. Operator.

Speaker #1: We expect GNA expense will decline in 2026 over 2025 to a range of $60 to $65 million. This includes approximately $5 million of non-cash depreciation and stock-based compensation expense.

Speaker #1: Our full-year non-cash interest expense is expected to be between $30 million and $35 million. Additionally, we do not expect any significant gain or loss on our equity method investment in 2026.

Speaker #1: Lastly, we expect to end 2026 with approximately $400 to $460 million in cash and investments. And with that, we'll now open the call for questions.

Speaker #1: Operator?

Speaker #2: Thank you. As a reminder to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again.

Operator: Thank you. As a reminder to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. In the interest of time, we do ask that you please limit yourself to one question at this time. Please stand by, we compile the Q&A roster. Our first question will come from Yasmeen Rahimi from Piper Sandler. Your line is open.

Speaker #2: In the interest of time, we do ask that you please limit yourself to one question at this time. Please stand by. We will compile the Q&A roster.

Speaker #2: And our first question will come from Yasmeen Rahimi from Piper Sandler. Your line is open.

Speaker #3: Good afternoon, team. Thank you so much for all the great updates. Maybe a quick question that's sort of two-part. One is, given congrats on presenting the results of the AA study at the AAD conference, I hope to understand, Jay-Z, what type of new data we could see, or is it just more an opportunity to showcase it?

Yasmeen Rahimi: Good afternoon, team. Thank you so much for all the great updates. Maybe a quick question that's sort of two-part. One is given congrats on presenting the results AA study at the AAD conference. Hope to understand, JZ, what type of new data we could see, or is it just more an opportunity to showcase it? Part two is maybe help us frame what do you hope to see in this blinded 16-week treatment extension period. What does REZPEG need to show to be highly competitive, both in regards to mean SALT reduction as well as SALT 20. Thank you, and I'll jump back in the queue.

Speaker #3: And then part two is maybe help us frame what you want to what you hope to see in this blinded 16-week treatment extension period.

Speaker #3: What does ResPEG need to show to be highly competitive, both in regard to mean salt reduction as well as SALT20? Thank you. And I'll jump back in the queue.

Jonathan Zalevsky: Thanks, Yasmeen. One of the things that we'll be presenting later, and that's coming up in the future, data presentation is remember that the way the study was designed is that it was a 36-week treatment period. However, patients that had begun to grow hair but had not yet reached a SALT 20, they were permitted to advance into a 16-week additional extension, which was also a blinded portion of the study, where they could receive dosing all the way to week 52. When we presented the data in December, we had already indicated that there were already 3 patients that had entered into that period as of the time of that December data cut when we presented the results last year, that had already reached the SALT 20 after week 36.

Speaker #4: So one of the things that we'll be presenting later, and that's coming up in the future data presentation, is—remember that the way the study was designed is that it was a 36-week treatment period.

Speaker #4: However, patients that had begun to grow hair but had not yet reached a SALT20, they were permitted to advance into a 16-week additional extension, which was also a blinded portion of the study where they could receive dosing all the way to week 52.

Speaker #4: And when we presented the data in December, we had already indicated that there were already three patients that had entered into that period as of the time of that December data cut when we presented the results last year.

Speaker #4: That had already reached a SALT20 after week 36. And those patients were not even considered in the week 36 numerator because their response happened afterwards.

Jonathan Zalevsky: Those patients were not even considered in the week 36 numerator because their response happened afterwards. When you kind of then ask, what is the tone of the presentation that we'll be making once we begin our quiet period in April and after we present the top-line results, we'll be sharing the additional effect of treatment with REZPEG and the potential of additional patients to convert to achieving SALT 20 responses, as well as deepening their SALT reductions over that additional 16-week treatment period. I think you're kind of potentially starting to see a bit of a paradigm we saw in atopic dermatitis as we extended the duration of dosing to week 52 at maintenance.

Speaker #4: So when you kind of then ask what is the tone of the presentation that we'll be making, once we begin our quiet period in April and after we present the top-line results, we'll be sharing the additional effect of treatment with ResPEG and the potential of additional patients to convert to achieving SALT20 responses as well as deepening their salt reductions over that additional 16-week treatment period.

Speaker #4: And I think you're kind of potentially starting to see a bit of a paradigm we saw in atopic dermatitis as we extended the duration of dosing to week 52 in maintenance.

Jonathan Zalevsky: Patients treated with REZPEG continued to develop additional efficacy, and we think there's a potential that could happen as well in alopecia areata, as we've already seen 3 patients achieve responses that way. We'll be sharing the totality of that patient population. All of the patients will have completed week 52 that entered into that extension period, and that will be the nature of the results. In terms of what we'd like to see for what would be competitive, REZPEG has already demonstrated quite a different profile from a JAK inhibitor. When you consider all of the upsides of growing hair, but then balanced by the downsides, as both Howard and I mentioned in our presentation, there are really significant safety issues and risks that make taking a JAK inhibitor chronically very challenging.

Speaker #4: Patients treated with ResPEG continued to develop additional efficacy. And we think there's a potential that that could happen as well in alopecia areata as we've already seen three patients achieve responses that way.

Speaker #4: So we'll be sharing the totality of that patient population all of the patients will have completed week 52 that entered into that extension period.

Speaker #4: And that will be the nature of the results. In terms of what we'd like to see for what would be competitive, ResPEG has already demonstrated quite a different profile from a JAK inhibitor.

Speaker #4: When you consider all of the upsides of growing hair, but then balanced by the downsides as both Howard and I mentioned in our presentation, there are really significant safety issues and risks that may be taking a jacket inhibitor chronically very challenging.

Jonathan Zalevsky: Particularly, it's a class of drug that's difficult for dermatologists to use, owing to the laboratory monitoring and the additional, you know, work and risk that the patients have. When patients have to stop taking a JAK inhibitor for any reason, pretty much everyone loses all the hair that they might have grown when they were on the JAK inhibitor. We'd like to see an efficacy profile that reaches low dose of LITFULO. I think we have a very good shot of getting to that level. We'd like to deliver all of the other things that REZPEG has already shown, which is a completely differentiated safety profile, a much more convenient dosing frequency relative to a once-a-day pill, and really an opportunity to provide a much better biologic that can be used chronically in this chronic indication. Thank you for the question, Yas.

Speaker #4: And particularly, it's a class of drug that's difficult for dermatologists to use, owing to the laboratory monitoring and the additional work and risk that the patients have.

Speaker #4: And then when patients have to stop taking a jacket inhibitor for any reason, pretty much everyone loses all the hair that they might have grown.

Speaker #4: When they were on the JAK inhibitor. So, we'd like to see an efficacy profile that reaches low-dose aluminate. I think we have a very good shot of getting to that level.

Speaker #4: And then we'd like to deliver all of the other things that ResPEG has already shown, which is a completely differentiated safety profile a much more convenient dosing, frequency relative to a once-a-day pill, and really an opportunity to provide a much better biologic that can be used chronically in this chronic indication.

Yasmeen Rahimi: Thank you.

Speaker #4: Thank you for the question, Yas.

Operator: Thank you. Our next question comes from Julian Harrison from BTIG. Your line is open.

Speaker #3: Thank you.

Speaker #2: Thank you. Our next question comes from Julian Harrison from BTIG. Your line is open.

Julian Harrison: Hi, thank you for taking the questions and congrats on the progress. Regarding the phase 3 program in atopic dermatitis that's expected to initiate next quarter, would you expect the ACQ-5 data to make its way into a potential label from those trials? If so, I'm wondering how enabling you would expect that to be from a commercial standpoint relative to dual labeling, both in atopic derm and asthma. Then, sorry if I missed it, I'm curious, but also what percentage of bio-experienced patients you plan to enroll in your atopic dermatitis trial that's upcoming. Is there a defined target there?

Speaker #5: Hi. Thank you for taking the questions and congrats on the progress. Regarding the phase three program in atopic dermatitis that's expected to initiate next quarter, would you expect the ACQ5 data to make its way into a potential label from those trials?

Speaker #5: If so, I'm wondering how enabling you would expect that to be from a commercial standpoint relative to dual labeling both in atopic derm and asthma.

Speaker #5: And then sorry if I missed it. I'm curious also what percentage of bioexperienced patients you plan to enroll in your atopic dermatitis trial. That's upcoming.

Speaker #5: Is there a defined target there?

Jonathan Zalevsky: Sure. Mary, would you like to answer that?

Howard Robin: Sure. Mary, would you like to answer that?

Mary Tagliaferri: Sure. Hi. We are including the ACQ-5 in the phase 3 program, and we will look at this at baseline and through induction, and then we'll also look at the ACQ-5 through maintenance. We are going to power for multiplicity, and we will control for multiplicity for the ACQ-5, and we will, you know, make every effort to include that into the label. That is certainly part of our plan. With respect to biologic-experienced patients, we are anticipating roughly 25% of the patients in our phase 3 program will be biologic-experienced, and then 75% of the patients will be biologic and JAK inhibitor naive.

Speaker #4: Sure. Mary, would you like to answer that?

Speaker #3: Sure. Hi. So we are including the ACQ5 in the phase three program, and we will look at this at baseline and through induction and then we'll also look at the ACQ5 through maintenance.

Speaker #3: And we are going to power for, and we will control for multiplicity for the ACQ5. And we will make every effort to include that into the label.

Speaker #3: And that is certainly a part of our plan. With respect to bioexperienced patients, we are anticipating roughly 25% of the patients in our phase three program will be bioexperienced and then 75% of the patients will be biologic and jacket inhibitor naive.

Julian Harrison: Very helpful. Thank you.

Mary Tagliaferri: Yep, thank you.

Operator: Thank you. Our next question comes from Jay Olson from Oppenheimer & Co. Your line is open.

Speaker #5: Very helpful. Thank you.

Speaker #3: Yeah. Thank you.

Speaker #2: Thank you. Our next question comes from Jay Olson from Oppenheimer. Your line is open.

[Analyst] (Oppenheimer & Co. Inc.): Oh, hi, team. This is Shawn. I'm a colleague for Jay. Thanks for taking the questions and congrats on the progress. Just, on the AD part, I'm just wondering for the phase 3 trial and also for future commercial launch, what are the formulation or device for REZPEG we're thinking right now? Also, like, I'm wondering if there are any clinical guidance or implementation on ISR mitigation strategy for phase 3, or you can address that's right. Thank you.

Speaker #6: Oh, hi, Jane. This is Sean on the call for Jay. Thanks for taking the questions and congrats on the progress. Just on the AD part, I'm just wondering for the phase three trial and also for future commercial launch, what are the formulation or device for ResPEG?

Speaker #6: We're thinking right now. And also, I'm wondering if there are any protocol guidance or implementation on ISR mitigation strategy for your phase three or you think that's necessary.

Mary Tagliaferri: Yeah. Hi.

Jonathan Zalevsky: Sure. I can,

Speaker #6: Thank you.

Mary Tagliaferri: Go ahead, Steve. You can go first.

Jonathan Zalevsky: Go ahead, Mary.

Mary Tagliaferri: No, you go first, Steve.

Speaker #3: Yeah. Hi. So.

Jonathan Zalevsky: Well, yeah. I'll cover the question about the formulation, and then I'll turn it over to you, Mary. REZPEG is a very low volume administered agent. Most patients receive 1mL, 2mL max, depending on their body weights. Our plan is to run phase 3 in the same way that we ran the phase 2, where the drug was presented as a vial. Then at the study site, it's drawn up and administered to the patient by staff at the study centers. Our plan for the commercial launch is to launch REZPEG in an auto-injector coupled with an auto-injector device. For that, we'll be switching to what's called weight-banded dosing. We won't need to use weight-based dosing because patients will be dosed according to their body weight.

Speaker #4: Sure. So I can.

Speaker #3: Go ahead, Jason. Go first. No, go first, Jason.

Speaker #4: Well, yeah. I'll cover the question about the formulation, and then I'll turn it over to you, Mary. So ResPEG is a very low-volume administered agent.

Speaker #4: So, patients receive—most patients receive one milliliter, two milliliters max, depending on their body weight. And then our plan is to run Phase 3 in the same way that we ran Phase 2, where the drug was presented as a vial.

Speaker #4: And then at the study site, it's drawn up and administered to the patient. By staff at the study centers. But our plan for the commercial launch is to launch ResPEG in an auto-injector.

Speaker #4: Coupled with an auto-injector device. And so for that, we'll be switching to what's called weight-banded dosing. So we won't need to use a weight-based dosing because patients will be dosed according to their body weight.

Jonathan Zalevsky: We know that will have a lot of opportunities and also advantages. This will be a very straightforward self-administered product, very similar to all the biologics that are used in single-use pen devices. Regarding some of the way we'll run the phase 3, I'll turn that over to Mary.

Speaker #4: And then we know that will have a lot of opportunities and also advantages this will be a very straightforward self-administered product, very similar to all the biologics that are used in single-use pen devices.

Speaker #4: And then regarding some of the way it will run the Phase 3, I'll turn that over to Mary.

Mary Tagliaferri: Yeah. Hi. First, I think it would be a good idea to just review the ISR cases that we've seen across our program. 99% of the ISRs were mild to moderate in severity, with the vast majority being mild and only 1% are severe. We do see a very low dropout rate due to ISRs. The reason for that is these ISRs are not like what were experienced when Dupixent was launched. We do not commonly see pain. We do not commonly see pruritus. The vast majority of patients, 96% of them are just having erythema or redness. Likewise, these patients are not having ISRs every time they receive an injection.

Speaker #3: Yeah. Hi. So first, I think it's a good idea to just review the ISR cases that we've seen across our program. And 99% of the ISRs were mild to moderate in severity.

Speaker #3: With the vast majority being mild and only 1% are severe. And we do see a very, very, very low dropout rate due to ISRs.

Speaker #3: The reason for that is these ISRs are not like what we're experiencing when TALKS was launched. We do not commonly see pain. We do not commonly see pruritus.

Speaker #3: The vast majority of patients—96% of them—are just having erythema, or redness. And likewise, these patients are not having ISRs every time they receive an injection.

Mary Tagliaferri: In fact, we see really the vast majority of patients are really only having two or fewer during the course of treatment. In terms of how these are managed, patients use cold compresses with ice, and if need be, they can also use a topical corticosteroid. But since the vast majority of patients don't have pruritus, for the most part, patients are not needing to use a topical corticosteroid. We, you know, did have Dr. Jonathan Silverberg on in our last presentation of the maintenance data, and you know, he certainly underscored that the trade-off is an easy choice for patients.

Speaker #3: In fact, we see the vast majority of patients are really only having two or fewer during the course of treatment. In terms of how these are managed, patients use cold compresses with ice.

Speaker #3: And if need be, they can also use a topical corticosteroid. But since the vast majority of patients don't have pruritus, for the most part, patients are not needing to use a topical corticosteroid.

Speaker #3: We did have Dr. Jonathan Silverberg on in our last presentation of the maintenance data. And he certainly underscored that the trade-off is an easy choice for patients.

Mary Tagliaferri: These patients, you know, are having severe itch, and with REZPEG having that very rapid itch relief, and resolution of atopic dermatitis, with the trade-off being an erythematous ISR, that, you know, overall the risk-benefit highly favors REZPEG as a treatment for atopic dermatitis.

Speaker #3: These patients are having severe itch. And with ResPEG having that very rapid itch relief and resolution of atopic dermatitis, with the trade-off being an erythematous ISR, that overall, the risk-benefit highly favors ResPEG as a treatment for atopic dermatitis.

[Analyst] (Oppenheimer & Co. Inc.): Great. Thank you very much.

Operator: Thank you. Our next question comes from Roger Song from Jefferies. Your line is open.

Speaker #6: Great. Thank you very much.

Speaker #2: Thank you. Our next question comes from Roger Song from Jefferies. Your line is open.

Roger Song: Great. Congrats for the progress, and then thanks for taking the question. My question is related to, I think, the last data cut for the data about the alopecia areata. You have 3 patients reach SALT 20, and then another 7 patients reach SALT 30. Just curious, what are the dosing for those 3 and the 7 patients? Given if they are deepening the response since you are getting towards high dose REZPEG, you know, based on your market research and then your advice, sir, will this efficacy reaching high dose REZPEG change the potential clinical adoption compared to the low dose? Thank you.

Speaker #5: Great. Congrats on the progress, and thanks for taking the question. My question is related to, I think, the last data cut for the alopecia areata.

Speaker #5: We have three patient reach for 20. And then another seven patient reach for 30. Just curious, what are the dosing for those three and the seven patients?

Speaker #5: And then, given if they are deepening the response, since you're getting towards high-dose alumi n, based on your market research and then the advice, will this efficacy—reaching high-dose alumi n—change the potential clinical adoption compared to the low dose?

Mary Tagliaferri: Yeah. Hi, Roger.

Mary Tagliaferri: Yeah.

Jonathan Zalevsky: Yeah.

[Analyst] (Oppenheimer & Co. Inc.): So-

Mary Tagliaferri: So-

Jonathan Zalevsky: Thanks, Roger. Oh, go ahead, Mary.

Speaker #5: Thank you.

[Analyst] (Oppenheimer & Co. Inc.): Yeah, JZ. Yes.

Mary Tagliaferri: Yeah, JZ. Yes.

Speaker #3: Yeah. Hi, Roger.

Speaker #4: Yeah. Thanks, Roger, for your—oh, go ahead, Mary.

Jonathan Zalevsky: No, thank you for your question, Roger. You know, I just want to reiterate that the study is blinded, right? When we share the results coming up very soon in April, we'll unblind, and we'll present all of the results for all of the patients that made it through to the extension period. That'll be an update for us very, very soon. In terms of the TPP, you know, one of the really important elements is that this is a biologic, and it brings a completely different profile. Our objective was always to achieve the TPP of low dose JAK inhibitor Olumiant. We believe we've already met that with the data that we have. We believe that 52 weeks is the correct duration of extension.

Speaker #3: Yeah, Jason. Yeah.

Speaker #4: No, thank you for your question, Roger. So I just want to reiterate that the study is blinded. Right? And so when we share the results, coming up very soon in April, we'll unblind and we'll present all of the results.

Speaker #4: For all of the patients that made it through to the extension period. So that'll be an update for us very, very soon. And then, in terms of the TPP, one of the really important elements is that this is a biologic, and it brings a completely different profile.

Speaker #4: And our objective was always to achieve the TPP of low-dose JAK inhibitor alumin. And we believe we've already met that with the data that we have.

Jonathan Zalevsky: For example, in the phase 3 that we plan, we'd be treating longer than 36 weeks. We know that there's an opportunity with the additional treatment duration, you know, to potentially elicit even more efficacy of effect. We think there's just this really white space kind of an opportunity because the first time a biologic moves into an autoimmune indication, it could have a very profound effect on prescribing patterns from physicians. Many doctors are much more comfortable prescribing a safer biologic as opposed to a more difficult to manage and potentially more challenging agent like a JAK inhibitor. It's something we're very, very excited about, and, you know, it's a data update that we're really looking forward to, coming up, and it's a TPP that we think could be a really big opportunity for REZPEG in the future.

Speaker #4: We believe that 52 weeks is the correct duration of extension. So, for example, in the Phase 3 that we plan, we know we'd be treating longer than 36 weeks.

Speaker #4: And we know that there's an opportunity with the additional treatment duration to potentially elicit even more efficacy of effect. We think there's just this really white slate kind of opportunity, because the first time a biologic moves into an autoimmune indication, it can have a very profound effect on prescribing patterns from physicians.

Speaker #4: Many doctors are much more comfortable prescribing a safer biologic as opposed to a more difficult-to-manage and potentially more challenging agent like a JAK inhibitor.

Speaker #4: So it's something we're very, very excited about. And it's a data update that we're really looking forward to coming up. And it's a TPP that we think could be a really big opportunity for ResPEG in the future.

Roger Song: Got it. Thank you.

Operator: Thank you. Our next question comes from Mayank Mamtani from B. Riley Securities. Your line is open.

Speaker #5: Got it. Thank you.

Speaker #2: Thank you. Our next question comes from Mayank Mumtani from B. Reilly Securities. Your line is open.

Mayank Mamtani: Yes, good afternoon, team. Thanks for taking our questions, and congrats on the progress. Another alopecia question. Sorry if I missed this, what incremental data relative to the December update you would get at the conference? And if you could comment on, you know, any plans for using the off-therapy data for, you know, the responders that you had and, you know, efficacy responses still climbing as part of 16-week extension. I wasn't sure, you know, at what point you'd look at the off-therapy data. And then just a little high-level question for Howard, if I may. You know, the EASI 100 responder rate, how important do you think of that as a differentiator? I don't know if many agents get there.

Speaker #6: Yes. Good afternoon, Dean. Thanks for taking our questions, and congrats on the progress. So, another alopecia question—sorry if I missed this. What incremental data related to the December update will you get at the conference?

Speaker #6: And if you could comment on any plans for releasing the off-therapy data for the responders that you had, and know you had efficacy responses still climbing as part of the 16-week extension.

Speaker #6: So wasn't sure at what point you'd look at the off-therapy data? And then just a little high-level question for Howard, if I may. The easy 100 responder rate how important do you think of that as a differentiator?

Mayank Mamtani: I also ask that in context of you know the initial framing of a large growing AD market, you know, which could have multiple entrants around the time, you know, you get on market in 2029. I understand the near-term launch landscape has certainly narrowed, but just thinking longer term.

Speaker #6: I don't know if many agents get there. I also ask that in context of the initial framing of a large, growing ATD market, which could have multiple entrants around the time you get on market in 2029.

Speaker #6: I understand the near-term launch landscape has certainly narrowed, but just thinking longer term. Well, I'll answer the last part of the question first and then turn it over to JZ and Mary.

Howard Robin: Well, I'll answer the last part of the question first, then turn it over to JZ and Mary. I think EASI 100 hasn't been looked at very closely, and it hasn't been reported very much because very few people attain the levels that we've been able to attain. If you look at the maintenance data where we have achieved, you know, 30% or so EASI 100 scores, again, I think that's very important. It leads to essentially effectively complete clearance of the disease in these patients over time. While it hasn't been talked about much and people talk about EASI 75 and EASI 90, that's because it's really difficult to achieve EASI 100, and we've done it.

Speaker #6: I think Easy 100 hasn't been looked at very closely, and it hasn't been reported very much because very few people attain the levels that we've been able to attain.

Speaker #6: So if you look at the maintenance data, where we have achieved 30% or so easy 100 scores—again, I think that's very important. And it leads to, essentially, effectively complete clearance of the disease in these patients over time.

Speaker #6: And while it hasn't been talked about much, and people talk about easy 75 and easy 90, that's because it's really difficult to achieve easy 100.

Jonathan Zalevsky: I think that says a lot about the potential for the Treg mechanism in general. I'll turn the rest of the question over to JZ and Mary. Sure. Thanks, Howard. Mayank, you asked many questions in one question, 12 parts. Let me just sort of make sure I catch them all. In terms of the AAD presentation, it's you know coming up in just a couple of weeks, so you can see you know all of the data that's presented, and it'll be presented in the medical conference, right, by a physician. In terms of the rest of the study, we do have a catalyst later this year, which will be the 24-week off-drug period of evaluation from the alopecia areata study.

Howard Robin: I think that says a lot about the potential for the Treg mechanism in general. I'll turn the rest of the question over to JZ and Mary.

Speaker #6: And we've done it. So I think that says a lot about the potential for the TREG mechanism in general. I'll turn the rest of the question over to JZ and Mary.

Jonathan Zalevsky: Sure. Thanks, Howard. Mayank, you asked many questions in one question, 12 parts. Let me just sort of make sure I catch them all. In terms of the AAD presentation, it's you know coming up in just a couple of weeks, so you can see you know all of the data that's presented, and it'll be presented in the medical conference, right, by a physician. In terms of the rest of the study, we do have a catalyst later this year, which will be the 24-week off-drug period of evaluation from the alopecia areata study.

Speaker #4: Sure. Thanks, Howard. And Mayank, you asked many, many questions—in one question, 12 parts. So let me just make sure I catch them all.

Speaker #4: So in terms of the AAD presentation, it's coming up in just a couple of weeks. So you can see all of the data that's presented.

Speaker #4: And it'll be presented at the medical conference, right, by a physician. In terms of the rest of the study, we do have a catalyst later this year, which will be the 24-week off-drug period of evaluation from the alopecia areata study.

Jonathan Zalevsky: That is not gonna be data that we touch on either at AAD or in the April data presentation, which just focuses on the end of treatment at week 52. In the second part of this year, in the later part, in Q4, we'll present the results of the 24-week off-drug period. Those will be just future catalysts to look forward to for REZPEG and alopecia areata. Thank you for your question.

Speaker #4: But that is not going to be data that we touch on either at AAD or in the April data presentation, which does focus on the end of treatment at week 52.

Speaker #4: In the second part of this year, in the later part—in the fourth quarter—we'll present the results of the 24-week off-drug period. So those will be just future catalysts to look forward to from ResPEG and alopecia areata.

Mayank Mamtani: Thank you.

Operator: Thank you. Our next question comes from Samantha Semenkow from Citi. Your line is open.

Speaker #4: Thank you for your question.

Speaker #6: Thank you.

Speaker #2: Thank you. And our next question comes from Samantha Saminko from Citi. Your line is open.

Samantha Semenkow: Hi. Good afternoon. Thanks very much for taking the question. Let me ask one about the type 1 diabetes study. I'm wondering if you could just share a little bit more about that trial. I know there's growing interest in development here. I'm wondering how you see REZPEG potentially differentiating from other approaches in the clinic. Should that 2027 data include C-peptide preservation data?

Speaker #7: Hi. Good afternoon. Thanks very much for taking the question. Let me ask one about the Type 1 diabetes study. I'm wondering if you could just share a little bit more about that trial.

Speaker #7: I know there's growing interest in development here. I'm wondering how you see ResPEG potentially differentiating from other purchases in the clinic? And should that 2027 data include C-peptide preservation data?

Jonathan Zalevsky: If I could squeeze one more in just more broadly, as you think about advancing REZPEG into additional indications, you mentioned quite a few in your prepared remarks, JZ. How do you think about prioritizing those for which ones might be the first to potentially advance it to the clinic? Thanks very much. All right. Thanks, Sam. You know, in the type 1 diabetes, it was very interesting because TrialNet was actually looking for a regulatory T cell targeting approach. You know, it was very exciting because there was a lot of sort of mutual drive for bringing that forward. It was also a very competitive process working with them because they have many things that they can choose from. We were very excited that they selected REZPEG to run the study.

Samantha Semenkow: If I could squeeze one more in just more broadly, as you think about advancing REZPEG into additional indications, you mentioned quite a few in your prepared remarks, JZ. How do you think about prioritizing those for which ones might be the first to potentially advance it to the clinic? Thanks very much.

Speaker #7: And then, if I can squeeze one more in—just more broadly—as you think about advancing ResPEG into additional indications, you mentioned quite a few in your prepared remarks, JZ.

Speaker #7: How do you think about prioritizing those—for which ones might be the first to potentially advance into the clinic? Thanks very much.

Jonathan Zalevsky: All right. Thanks, Sam. You know, in the type 1 diabetes, it was very interesting because TrialNet was actually looking for a regulatory T cell targeting approach. You know, it was very exciting because there was a lot of sort of mutual drive for bringing that forward. It was also a very competitive process working with them because they have many things that they can choose from. We were very excited that they selected REZPEG to run the study.

Speaker #4: Sure. Thanks, Sam. So in Type 1 diabetes, it was very interesting because TrialNet was actually looking for a regulatory T-cell targeting approach, and it was very exciting.

Speaker #4: Because there was a lot of sort of mutual drive for bringing that forward. And then it was also a very competitive process working with them because they have many things that they can choose from.

Jonathan Zalevsky: Now, one of the underlying scientific themes is there is a well-known sort of theory about the role of regulatory T cells in this disease and the sort of how thymic antigens end up being, you know, bad for driving the auto-reactivity against the islet cells, and that a loss of Treg control, you know, really exacerbates that. There was a goal in order to elevate Tregs in these patients in order to slow the progression of the disease and ideally, you know, overcome it altogether. The first step in sort of achieving this long mission is this therapeutic intervention study. This trial is really run very much in the same way that the first Teplizumab studies were run.

Speaker #4: We were very, very excited that they selected ResPEG to run the study. Now, one of the underlying scientific themes is there is a well-known sort of theory about the role of regulatory T-cells in this disease and how thymic antigens end up being bad for driving the autoreactivity against the islet cells.

Speaker #4: And that a loss of TREG control really, really exacerbates that. So there was a goal in order to elevate TREGs in these patients in order to slow the progression of the disease.

Speaker #4: And ideally, overcome it altogether. And so the first step in sort of achieving this long mission is this therapeutic intervention study. And this trial is really run very much in the same way that the first Teplizumab studies were run.

Jonathan Zalevsky: A big difference is that we're giving a six-month treatment as opposed to just a short, you know, burst, just a few weeks as how Teplizumab is dosed. The goal is of course to really slow down the rate of decline. There will be an opportunity for early data next year, and it's a little early to say the full extent of what that would be, Sam. However, yes, a Mixed-Meal Tolerance Test, right, with C-peptide is obviously one of the key endpoints in the study, along with HbA1c levels and also insulin usage. It's a well-designed study with probably the most highly qualified team of people to do that kind of study in the TrialNet consortium.

Speaker #4: The big difference is that we're giving a six-month treatment, as opposed to just a short burst—just a few weeks—as how Teplizumab is dosed.

Speaker #4: And then the goal is, of course, to really slow down the rate of decline there will be an opportunity for early data next year and it's a little early to say the full extent of what that would be, Sam.

Speaker #4: However, yes, a mixed meal tolerance test, right, with CPAP diet is obviously one of the key endpoints in the study, along with HbA1c levels and also insulin usage.

Speaker #4: And so those are the key activities that are being tracked in the patients, and it's a well-designed study with probably the most highly qualified team of people to do that kind of study in the TrialNet consortium.

Jonathan Zalevsky: Then in terms of the other indications, it is still something that we're deciding on, which indications and which ways to go. I think that we've seen so many examples of data from our own program that would really make some indications quite attractive. I think it's quite clear that this mechanism in both skin diseases and in diseases that have a Th2 drive has quite a lot of potential. Seeing the results that we saw in patients with comorbid asthma was very exciting. That makes that a very, very interesting indication. There are a number of allergic indications as well that are also potentials. This is something that we'll give more updates on in the future in the coming months. Thank you.

Speaker #4: And then, in terms of the other indications, it is still something that we're deciding on, which indications and which ways to go. But I think that we've seen so many examples of data from our own program that would really make some indications quite attractive.

Speaker #4: I think it's quite clear that this mechanism in both skin diseases and in diseases that have a TH2 drive has quite a lot of potential.

Speaker #4: And so, seeing the results that we saw in patients with comorbid asthma was very exciting. So that would make that a very, very interesting indication.

Speaker #4: And there are a number of allergic indications as well that are also potentials. So this is something that we'll give more updates on in the future, in the coming months.

Mary Tagliaferri: Yeah. We just may want to add too, just in terms of the differentiation in Type 1 diabetes, you know, Tzield is not an easy drug to give. It's administered as a 14-day course of IV infusion, so the step-up dosing schedule. Patients can commonly have cytokine release syndrome. You then do have to give a number of other medications, you know, an antipyretic, an antihistamine, maybe an antiemetic. Clinicians have to monitor for lymphopenia, rash, and even elevated liver enzymes.

Speaker #4: Thank you.

Speaker #8: Yeah, and we just may want to add, too, just in terms of the differentiation in type 1 diabetes, Tazil is not an easy drug to give.

Speaker #8: It's administered as a 14-day course of IV infusion for the step-up dosing schedule. Patients can commonly have cytokine release syndrome, and so you do have to give a number of other medications—an antipyretic, an antihistamine, and maybe an antiemetic.

Speaker #8: And then clinicians have to monitor for lymphopenia, rash, and even elevated liver enzymes. So, in contrast, an outpatient dosing regimen with ResPEG—where there's not routine monitoring and you don't see cytokine release syndrome—I think also affords a highly differentiated and more favorable safety profile, as well as a drug that's administered outpatient as opposed to as an IV infusion in the infusion center or even hospital.

Mary Tagliaferri: you know, in contrast, an outpatient dosing regimen with REZPEG, where there's not routine monitoring and you don't see cytokine release syndrome, I think also affords a highly differentiated and more favorable both safety profile as well as, you know, drug that's administered outpatient as opposed to as an IV infusion in an infusion center or even hospital.

Jonathan Zalevsky: Thank you. Thank you.

Samantha Semenkow: Thank you. Thank you.

Operator: Thank you. Our next question will come from Arthur He from H.C. Wainwright. Your line is open.

Speaker #2: Thank you. Thank you. And our next question will come from Arthur He from HC Wainwright. Your line is open.

Arthur He: Hey, how are you team? Congrats on the progress. Can you guys hear me okay?

Speaker #4: Hey, how are you, team? Congrats on the progress. Can you guys hear me okay?

Jonathan Zalevsky: Yes, we can.

Arthur He: Yeah. Okay. Sounds good. I have two questions. I know you're gonna present the extension data from the A study in April, but if allowed, could you tell us how many patients complete the extension phase? And also, when the patient finish the extension, do they have choice to continue on the drug or everybody goes to the off treatment period? That's question one. Question two is, could you give us a quick update on the Lilly trial? Thanks.

Speaker #6: Yes, we can.

Speaker #4: Yep. Oh, okay. Sounds good. So I have two questions. I know you're going to present the extension data from the ACE study in April, but if it's allowed, could you tell us how many patients completed the extension phase?

Speaker #4: And also, when the patient finished the extension, do they have a choice to continue on the drug, or does everybody go to the off-treatment period?

Speaker #4: That's question one. Question two is, could you give us a quick update on the latest trial? Thanks.

Jonathan Zalevsky: JZ, why don't you take the first part? Let me start off with the first question. Really quickly. As we announced in December, there were 23 patients that were ongoing in the 16-week extension. If you remember, Arthur, we had a waterfall plot, and they were the green dot people, patients, you know, on that chart. The data update that's coming in April will be when everybody completed the 52-week treatment. Those 23 people, as well as anyone that had completed it prior. For this trial, all treatment stops for all patients at either week 36 or week 52 for the people that went into the extension. Afterwards, everyone is followed for 24 weeks off drug. For the second question, I'll turn it over to you, Howard.

Howard Robin: JZ, why don't you take the first part?

Jonathan Zalevsky: Let me start off with the first question. Really quickly. As we announced in December, there were 23 patients that were ongoing in the 16-week extension. If you remember, Arthur, we had a waterfall plot, and they were the green dot people, patients, you know, on that chart. The data update that's coming in April will be when everybody completed the 52-week treatment. Those 23 people, as well as anyone that had completed it prior. For this trial, all treatment stops for all patients at either week 36 or week 52 for the people that went into the extension. Afterwards, everyone is followed for 24 weeks off drug. For the second question, I'll turn it over to you, Howard.

Speaker #6: JZ, why don't you take the first part?

Speaker #4: The first question? Yeah. Okay. Yeah. So, really quickly—so as we announced in December, there were 23 patients that were ongoing in the 16-week extension.

Speaker #4: If you remember, Arthur, we had a waterfall plot and they were the green dot people, patients, on that chart. So, the data update that's coming in April will be when everybody completed the 52-week treatment.

Speaker #4: So those 23 people, as well as anyone that had completed it prior. And then, for this trial, all treatment stops for all patients at either week 36 or week 52 for the people that went into the extension.

Speaker #4: And afterwards, everyone is followed for 24 weeks off drug. And then for the second question, I'll turn it over to you, Howard.

Howard Robin: Yeah. Thanks, Arthur. Look, obviously, I can't comment in detail on, you know, this type of litigation. This trial was scheduled for last year. It's in federal court, so because of the government shutdown last year, it was moved to this year because the courts were shut down. This trial is scheduled for 8 September, jury trial in federal court in San Francisco, and we're fully committed to pursuing this. We, you know, we certainly think we were harmed, and let's see how this plays out in court. That's as much as an answer as I can give you at this point, but thanks for the question.

Speaker #6: Yeah, thanks, Arthur. Look, obviously I can't comment in detail on this type of litigation. This trial was scheduled for last year. It's in federal courts.

Speaker #6: So, because of the government shutdown last year, it was moved to this year because the courts were shut down. This trial is scheduled for September 8.

Speaker #6: Jury trial in federal court in San Francisco. And we're fully committed to pursuing this. And we certainly think we were harmed. And let's see how this plays out in court.

Arthur He: Awesome. Thanks for taking my question. Yeah.

Speaker #6: So, as much of an answer as I can give you at this point. But thanks for the question.

Operator: Thank you. Our next question comes from Andy Hsieh from William Blair. Your line is open.

Speaker #4: Awesome. Thanks for taking my question.

Speaker #2: Thank you. Our next question comes from Andy Shea from William Blair. Your line is open.

Andy Hsieh: Great. Thanks for taking our questions. Maybe just one on some of the macro developments in the last couple weeks. Galderma, they kinda talked about increasing confidence in the atopic dermatitis space. So I guess part one, and I'm curious is if that alters your market sizing guidance that was provided during JP Morgan. And then also kind of data update from Pfizer with its tri-specific asset in atopic dermatitis. Not a lot of numerical data, but you know, kinda curious about your take on that. Thanks.

Speaker #4: Great, thanks for taking our questions. Maybe just one on some of the macro developments in the last couple of weeks. Galderma kind of talked about increasing confidence in the atopic dermatitis space.

Speaker #4: So I guess part one—and I'm curious if that alters your market sizing guidance that was provided during JPMorgan. And then also, kind of a data update from Pfizer with its tri-specific asset in atopic dermatitis.

Speaker #4: Not a lot of numerical data, but kind of curious about your take on that. Thanks.

Howard Robin: JZ, you wanna answer that one?

Jonathan Zalevsky: Sure. Yeah. Maybe I'll start off on the Pfizer one, and then Mary, you can touch on the Galderma update. Briefly covering, you know, Pfizer did present limited data in a press release covering a couple of molecules that were multi-specific molecules that were inhibiting either IL-4 and IL-13 and TSLP, or IL-4 and IL-13 and IL-33. They showed some very encouraging placebo-adjusted efficacy data. One of the things that, you know, it's a very interesting question because sort of combining known mechanisms, you know, into multi-specific agents, whether bi- or tri-specific is one way of achieving a combination kind of strategy. It's also a way of kind of bringing in all the known mechanisms into one thing.

Speaker #6: Okay. JZ, do you want to answer that one?

Speaker #4: Sure. Yeah. So maybe I'll start off on the Pfizer one, and then Mary, you can touch on the Galderma. So briefly covering Pfizer—Pfizer did present limited data in a press release.

Speaker #4: Covering a couple of molecules that were multi-specific molecules. They were inhibiting either IL-4, IL-13, and TSLP, or IL-4, IL-13, and IL-33. And they showed some very encouraging placebo-adjusted efficacy data.

Speaker #4: One of the things—that it's a very interesting question, because sort of combining known mechanisms into multi-specific agents, whether bi- or tri-specific, is one way of achieving a combination kind of strategy.

Jonathan Zalevsky: It has a potential to be helpful, but it is also kind of an incremental approach focusing on known and validated agents. We think there's an opportunity with a mechanism like REZPEG as a Treg targeting mechanism to provide the patient a much more holistic and potentially comprehensive kind of efficacy. Because really what a Treg is aiming to do is to fix the underlying pathology of the disease, not take away pathways that are disease drivers per se, but to fix what caused those pathways to be disease driving in the first place. That's why we think we've been observing, you know, in atopic dermatitis with ongoing dosing, such a growing level of efficacy, a deep maintenance, and the potential for patients to really do better. It's very interesting. I mean, most medicines you take, they tend to do worse for you over time.

Speaker #4: But it's also a way of kind of bringing in all the known mechanisms into one thing. It has the potential to be helpful, but it is also kind of an incremental approach focusing on known and validated agents.

Speaker #4: We think there's an opportunity with a mechanism like ResPEG as a Treg-targeting mechanism to provide the patient a much more holistic and potentially comprehensive kind of efficacy.

Speaker #4: Because really, what a Treg is aiming to do is to fix the underlying pathology of the disease—not take away pathways that are disease drivers per se, but to fix what caused those pathways to be disease-driving in the first place.

Speaker #4: And that's why we think we've been observing in atopic dermatitis with ongoing dosing such a growing level of efficacy, a deep maintenance, and the potential for patients to really do better. It's very interesting.

Jonathan Zalevsky: In our studies with REZPEG, we see the patients do better with time. We think there's a lot of opportunity there. We also are very excited that REZPEG is much further ahead, right? When you think about the programs that are initiating phase 3, REZPEG is at a very competitive position, and it's a novel MOA, and it has the opportunity to provide very differentiated opportunity for patients. Mary-

Speaker #4: I mean, most medicines you take, they tend to do worse for you over time. But in our studies with ResPEG, we see that patients do better with time.

Speaker #4: So, we think there's a lot of opportunity there. We also are very excited that ResPEG is much further ahead, right? So, when you think about the programs that are initiating Phase 3, ResPEG is at a very competitive position.

Speaker #4: And it's a novel MOA, and it has the opportunity to provide a very differentiated opportunity for patients. And Mary, I will turn it over to you for the Galderma.

Howard Robin: Yeah, let me

Jonathan Zalevsky: I'll turn it over to you for the Galderma question.

Howard Robin: Let me, Mary, before you jump in, let me just add to one thing JC said. Look, it's a great question. I just think it's important to understand the size of this market. Market, as I said earlier, is expected to be, by the mid-thirties, $35 billion. Only about 10% of patients who have atopic dermatitis are taking a biologic. So the potential for market growth is enormous. There's lots of room for various mechanisms of action here. So I don't think that becomes a real hurdle. I do think JC is absolutely correct that we, as a Treg agonist, are taking a very, very different approach than IL-13, IL-4, whatever blockade.

Speaker #6: Let me, Mary, before you jump in, let me just add one thing to what JC said. Look, it's a great question. I just think it's important to understand the size of this market.

Speaker #6: Market, as I said earlier, is expected to be, by the mid-30s, $35 billion. And only about 10% of patients who have atopic dermatitis are taking a biologic.

Speaker #6: So, the potential for market growth is enormous. There's lots of room for various mechanisms of action here. So, I don't think that becomes a real hurdle.

Speaker #6: I do think, JC is absolutely correct, that we, as an agonist—or as a Treg agonist—are taking a very, very different approach than IL-13, IL-4, whatever blockade.

Howard Robin: Let's see how it all plays out, but we're dealing with a market that's very, very large, and I think there's room for a number of different opportunities here. Mary, you wanna go ahead?

Speaker #6: So let's say it would all play out, but we're dealing with a market that's very, very large. And I think there's room for a number of different opportunities here.

Mary Tagliaferri: Yeah. No. I would just say that, you know, when we look at the ARCADIA, phase 3 data for nemolizumab, remember, those trials were in combination with topical corticosteroids. You know, patients really don't like to slather themselves with topical corticosteroids. You know, by the time they start a biologic, it's because they've already, you know, for a very long time, have been using topicals, and they haven't controlled their disease. When you look at those phase 3 programs, the EASI 75 ranges between 42% and 44% for nemolizumab in combination with the topical corticosteroid.

Speaker #6: Mary, you want to go ahead?

Speaker #5: Yeah. No. I would just say that when we look at the Arcadia phase 3 data for immunolizumab, remember those trials were in combination with topical corticosteroids.

Speaker #5: And patients really don't like to slather themselves with topical corticosteroids by the time they start a biologic. It's because they've already, for a very long time, been using topicals and they haven't controlled their disease.

Speaker #5: And when you look at those Phase 3 programs, the EASI-75 ranges between 42% and 44% for imunolizumab in combination with the topical corticosteroids.

Mary Tagliaferri: I'd just point everybody to look again at our presentation from February, where we showed those placebo patients, who were the placebo patients from the induction and crossed over for both 16 weeks of treatment and 24 weeks of treatment, where the EASI 75 was higher than what we saw with nemolizumab plus topical corticosteroids. It was 63% at week 16 and 58% at week 24. I just think even, you know, we saw a very rapid itch relief. Then when, you know, you look head-to-head at EASI 75, REZPEG seems to provide a deeper response than nemolizumab plus a topical corticosteroid. You know, from, you know, perspective that Howard said, of course, this is a huge market and there's lots of opportunity for multiple agents.

Speaker #5: I'd just point everybody to look again at our presentation from February, where we showed those placebo patients who were the placebo patients from the induction and crossed over for both 16 weeks of treatment and 24 weeks of treatment, where the EASI-75 was higher than what we saw with pneumo plus topical corticosteroids.

Speaker #5: It was 53% at week 16 and 58% at week 24. So I just think, even though we saw very rapid itch release, when you look head-to-head at EASI-75, ResPEG seems to provide a deeper response than immunolizumab plus a topical corticosteroid.

Speaker #5: So from the perspective that Howard said, of course, this is a huge market and there's lots of opportunity for multiple agents. I think when you stack up our data compared to Pneumo plus a topical corticosteroid, we have very, very compelling data which would really show that a physician would like to select an agent with a deeper EASI-75.

Mary Tagliaferri: I think when you stack up our data compared to Nemo plus a topical corticosteroid, you know, we have very compelling data which would really, you know, show that a physician would like to select an agent with a deeper EASI 75 for the benefit of their patients. Thanks for the question.

Speaker #5: For the benefit of their patients, but thanks for the question.

Operator: Thank you. I am showing no further questions from the phone lines. I'd now like to pass the conference back over to Howard Robin for any closing remarks.

Speaker #7: Thank you. And I am showing no further questions from the phone lines. I’d like to pass the conference back over to Howard Robin for any closing remarks.

Howard Robin: Well, thank you. I wanna thank everyone today for joining us, and for your continued support. We really greatly appreciate it. I wanna thank our employees who continue tirelessly on behalf of patients. Together, we've transformed our scientific hypothesis into real and potentially meaningful therapeutic options for patients. We look forward to initiating our phase 3 studies in atopic dermatitis in June and sharing our 52-week alopecia areata data in April. Stay tuned. Thanks, everybody.

Speaker #6: Well, thank you. And I want to thank everyone today for joining us and for your continued support. We really greatly appreciate it. And I want to thank our employees who work tirelessly on behalf of patients.

Speaker #6: And together, we've transformed our scientific hypothesis into real and potentially meaningful therapeutic options for patients. We look forward to initiating our Phase 3 studies in ectopic dermatitis in June.

Speaker #6: And sharing our 52-week alopecia areata data in April, so stay tuned. Thanks, everybody.

Operator: Thank you. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.

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