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Executives

Elizabeth Reed - VP, Legal Affairs and Corporate Secretary

Steve Worland - President, CEO & Director

Pete Slover - VP, Finance and Operations

Jim Freddo - SVP, Drug Development and Chief Medical Officer

Analysts

Edward Tenthoff - Piper Jaffray

Brian Abrahams - Oppenheimer

Phil Nadeau - Cowen & Company

Katherine Xu - Wedbush Securities

Ren Benjamin - Rodman

Anadys Pharmaceuticals, Inc. (ANDS) Q1 2010 Earnings Call April 27, 2010 5:00 AM ET

Operator

Good afternoon ladies and gentlemen and welcome to the Anadys Pharmaceuticals' first quarter 2010 conference call. My name is Jennifer and I'll be your coordinator for today. I would now like to turn the call over to Elizabeth Reed, Anadys' Senior Vice President of Legal Affairs and General Counsel.

Elizabeth Reed

Good afternoon and thank you for joining us. On behalf of Anadys Pharmaceuticals, I would like to welcome everyone to our conference call for the quarter ended March 31st 2010. I hope you've all had a chance to review today's press release. If you have not and you need a copy, you can visit our website at www.anadyspharma.com.

Before we get started, I would like to call your attention to the Safe Harbor statement. This conference call and webcast contains certain forward-looking statements within the meaning of the federal securities laws. These forward-looking statements include but are not limited to references to assessment that began anti-viral response and basic profile of ANA598 based on a 200 milligram bid 12 week result and 400 milligram bid eight week result. The ability for ANA598 to explore the combination with other direct anti-virals in developments.

The expected timing for releasing additional data from the Phase II combination study, predictions regarding ANA598 potential role in future HCV combination regiment based on pre-clinical and clinical attributes seen today as well as expectations regarding company's projected cash utilization.

More specifically, forward-looking statements include references to the pattern of anti-viral response that the company expects to see at the 400 milligram bid drug level to a 12 week. The belief that ANA598's ability to accelerate the rates of achieving undetectable levels of virus will result in improved SVR rate. The belief the ANA598 half-life will confer a lasting benefit in the form of durable response. Predictions regarding the outcome of clinical combination and expectations regarding the role of a non-nucleoside will play in future HCV therapy.

Investors are cautioned that all forward-looking statements involve risks and uncertainties that could cause actual results to differ, perhaps materially, from those anticipated or suggested by such forward-looking statements. For example, results of preclinical and early clinical studies may not be predictive of future results; and Anadys cannot provide any assurances that ANA598 will not have unforeseen safety issues or will continue to have favorable results as the Phase II study progresses.

Anadys' results may also be affected by its ability to enter into future collaborations, its effectiveness in managing its financial resources, the scope and validity of patent protection, the ability to obtain additional funding to support operations, regulatory development, clinical trial logistic as well as competition from other biotechnology and pharmaceutical companies. These and other risk factors are discussed in more detail on our SEC filings.

With that said, I'd like to introduce the members of our management team who will be speaking today. On the call we have Steve Worland, Ph.D., President and Chief Executive Officer; Jim Freddo, M.D., our Senior Vice President, Drug Development and Chief Medical Officer and Pete Slover, Vice President, Finance and Operations. First, Steve Worland will provide a brief introduction. Pete Slover will then provide our first quarter financial results after which then Jim Freddo will review the most recent data for ANA598. Steve Worland will then provide additional prospective on the non-nucleoside and ANA598 in particular after which we'll take questions.

At this time, I would like to turn the call over to Steve.

Steve Worland

Thank you, Elizabeth and thank you everyone for joining us on our call this afternoon. In the past few months, we made significant advances in the ANA598 program. We've reported antiviral activity in Phase II results from our on going phase II combination study through 12 week to the 200 milligram bid dose and through eight week for the 400 milligram BID dose. These data paint a very favorable profile for ANA598. The ANA598 clearly accelerates the rate of patients achieving undetectable levels of virus compared to interferon or ribavirin alone reaching a rate of 73% of week 12 at 200 milligram bid and 72% at week eight at 400 milligrams bid. Furthermore through these time points we saw no viral breakthrough in any patients. The durability of antiviral response without viral basically today is an impressive result that was not broadly anticipated in the HCV community.

This durability reflects the potency in long plasma half-life of ANA598 and demonstrates that non-nucleoside with superior pharmacokinetic such as ANA598 can provide a substantial pharmacology barrier to resistance. This important finding combined with the ANA598 clinical antiviral activity, safety and tolerability profile positions ANA598 as a very attractive agent to exam further in development but especially in combination with other direct antiviral.

Towards the close of the call, I will offer some prospective on non-nucleoside of the class and how we see ANA598 fitting into the emerging landscape. But first Pete Slover will review our financials after which Jim Freddo will review our most recent data on ANA598. When we get to Jim's section, we will have several data slides posted with this webcast to accompany his remark and I encourage you to follow the slides as he speaks. These slides will also be available after our call on the company's website. I'll now turn the call over to Pete. Pete?

Pete Slover

Thank you, Steve and good afternoon everyone. I'll begin with the review of our first quarter 2010 financials and finish with out cash position at quarter end. Operating expenses were $5.4 million for the current quarter compared to $8.9 million for the first quarter of 2009.

Research and development costs were $3.7 million for the current quarter compared to $6.9 million for same period in 2009. The $3.2 million decrease in research and development expenses was primarily attributable to a $1 million decrease in the ANA598 development cost and a $1.4 million decrease in the ANA773 development cost and to a lesser extent, cost savings associated with our strategic restructuring completed in 2009.

General and administrative expenses decreased $500,000 from the first quarter of 2010 compared to the same period in 2009 primarily as a result of cost savings associated with a strategic restructuring and a relocation of our corporate headquarters to a smaller facility during 2009. The company had a net loss of $6.2 million for the first quarter of 2010 compared to an $8.8 million net loss for the same period in 2009, included in a net loss for the first quarter of 2010 is a $900,000 non-cash loss, associated with an increase between December 31st, 2009 and March 31st, 2010 in that fair value our liability arising from warrants issued in our financing in June of 2009. The basic in diluted net loss per common share was $0.17 for the first quarter of 2010 compared to a net loss for common share of $0.30 for the same period in 2009.

For the quarter, the company had a cash utilization of $5.6 million. As of March 31st, 2010 the company's cash position totaled $14.9 million. We expect this cash position to support our operations through at least the first quarter of 2011 as they expect external expenditures associated with our phase II combination trials to decrease significantly within to the second half of 2010.

Now I will turn the call over to Jim.

Jim Freddo

Thank you, Pete. Before I discuss our most recent data, let me briefly review the design of our Phase II trial of ANA598 as shown on slide three. ANA598 is being dosed with pegylated interferon and ribavirin for 12 weeks. After 12 weeks, patients receive either 12 or 36 additional weeks of interferon and ribavirin. ANA598 was tested at two dose levels, 200 milligram bid and 400 milligrams bid each with a loading dose of 800 milligrams given twice on day one. A total of 95 patients participated in the trial, 29 and 200 milligram bid 34 at 400 milligrams bid and 32 in the control group that received standard of care and placebo.

Earlier this month, we presented preliminary data at the annual EASL conference that showed ANA598 has a robust antiviral effect at doses that have been safe and well tolerated, the antiviral data presented at EASL was to a 12 weeks for patients who received ANA598 200 milligrams bid and through eight weeks for patients who received 400 milligram as bid or standard of care alone.

The base line demographics for the study are shown on slide four. The three groups are well matched regarding baseline viral loads, subgenotype and standard demographic information. The antiviral activity results are shown on slide five. ANA598 when added to standard of care clearly accelerates the rate at which patients achieve undetectable levels of virus when compared to the control group. For the group who received ANA598 200 milligram bid, 73% of the patients achieved undetectable levels of virus at week 12.

At week 8, 72% of patients who received ANA598 400 milligram bid achieved undetectable levels of virus compared to 38% of patients who received standard of care with placebo in the control arm. The data cutoff for 400 milligram bid results reported at EASL was 8 weeks. While we don't yet have resulted at 400 milligram bid for week 12, it is instructive to look at what happened with patients who receive 200 milligram bid. In this group, the high percentage of patients with undetectable levels of virus at week 8 was maintained through week 12.

We expect to see a similar pattern and persistence of response through week 12 at the higher dose. It's also worth commenting on the response in the control patients. We had previously reported antiviral response through week 12 for the first half of the control group which was enrolled concurrently with the patients who received ANA598 200 milligram bid. In this first half of the control group, the response was higher than historical norms.

Based on the typical baseline demographics in our study, we communicated our expectation that as more patients were dosed with placebo plus standard of care, response rates would trend back towards historical values. This appears to be the case through 8 weeks for the complete group of patients receiving standard of care with placebo.

As Steve mentioned in his opening remarks, the antiviral response while receiving ANA598 has been remarkably durable. In the ongoing Phase II study, through 12 weeks of dosing at 200 milligram bid and 8 weeks of dosing at 400 milligram bid, no patient has experienced viral breakthrough.

Similarly we saw a no breakthrough in our prior mono-therapy study. Their durability of response reflects the pharmacological barrier to resistance provided by ANA598’s potency and desirable plasma half-life. These properties of ANA598 and their impact on limiting viral breakthrough should be particularly useful when combining ANA 598 with other direct antivirals.

Let me now turn to the safety results, through 12 weeks at 200 milligram bid and 8 weeks at 400 milligram bid ANA598 was safe and well tolerated with a tolerability profile comparable to standard of care alone. the type and severity of adverse events at both ANA598 doses was comparable to the group receiving standard of care and placebo. The incident of adverse events including laboratory abnormalities and rash was similar between the active and placebo groups and the adverse events seen are common for patients treated with interferon and ribavirin alone.

We recently completed 12 weeks of dosing in the 400 milligram bid and placebo group. We expect to release antiviral response and safety results through week 12 for these patients in the latter half of May. In addition to the data from the Phase II, study we also presented new pre clinical data regarding in vitro combinations of ANA598 with other direct acting antivirals at EASL as summarized on slide six.

Data was presented for ANA598 in combination with a variety of agents including protease inhibitor, three preliminary inhibitors with distinct sites of action, a cyclophilin inhibitor and interferon-alpha. This data showed the combinations of ANA598 with other agents of diverse mechanisms of action can dramatically suppress the emergence of resistance mutation in vitro. In fact we reported that cellular HCV RNA can be eradicated prior to the emergence of resistant mutants at concentrations of ANA598 and the tested compounds that have been readily achieved in patients.

We believe these results can be generalized beyond the specific compounds tested. When ANA598 is combined with another complimentary agent, we expect synergistic suppression of resistance and we would expect to eradicate cellular RNA prior to the emergence of resistant mutants. This should bode well for clinical combination as well where we expect synergistic interactions between ANA598 and other agents to counteract selection of resistant variants in patients.

To summarize, the antiviral response and safety through 12 weeks for the 200 milligram bid group and through 8 weeks for the 400 milligram bid group is very positive. We expect this positive impact on viral kinetics to translate into improved SVR rates. We believe this data coupled with the new preclinical in vitro data are clearly supportive of the potential for ANA598 to play a significant role in future HCV therapy, both in combination with approved agents and in combination with other antivirals currently in development. We look forward to reporting additional data to you next month as we seek to further enhance the attractive profile of ANA598.

Now I will turn the call back over to Steve, Steve?

Steve Worland

Thank you, Jen, Before we take questions, I would like to take the opportunity to provide a broader perspective on non-nucleoside as a class of antiviral for HCV therapy. And to remind you of the parameters by which we undertook the challenge of inventing a new non-nucleoside that would have the favorable attributes that we’ve seen today with ANA598. Over the last several years, a perception has developed in the parts of HCV investment community that non-nucleoside maybe least desirable as a class of antiviral than certain other mechanism in part based on the belief that rapid development of resistance was a likely treatment outcome for all non-nucleoside. You may recall that a similar perception prevailed in the early days of non nucleoside as anti-HIV therapy. However after earlier disappointed, placebo become the third non-nucleoside to be approved for HIV treatment and showed that in proper combinations non-nucleosides can be important components of antiviral regiment even in circumstances where resistance can be a challenge. We believe the future of HCV therapy will follow this pattern with non-nucleosides becoming important components of combination regiment once non-nucleosides with desirable potency and PK properties are approved.

The clinical data for ANA598 demonstrates the potential for non-nucleosides to a very attractive class of anti-HCV agents and the durability of response we’ve seen without viral breakthrough clearly refutes the notion that resistance will plague the entire class. Furthermore, there are many reasons including safety in pharmacokinetics while non-nucleosides are inherently a very attractive mechanism for antiviral activity. and lastly contrary to some perceptions, there has been long standing desire on the part of industry participants to develop non-nucleoside and combine this class with other classes for HCV therapy. The disappointments today have been associated with the specific attributes of individual agents rather than inherent limitations to or lack of interest in non-nucleosides as a class.

Slide seven shows some of the reasons why non-nucleosides are inherently attractive as a class of antiviral. From a safety perspective with regard to off-target activities, there are no human RNA preliminaries diminishing the potential for significant off-target effects in a well designed non-nucleosides. In contrast, there are almost 200 human serine proteases, fully one third of all recognized protease sequences in the human genome. This large number of related host proteins represents a significant specificity barrier for HCV protease inhibitors relative to host proteases, especially for agents that rely on chemical interactions with the active site to augment affinity.

Similarly with respect to the nucleoside class, the recognition and activation of nucleoside triphosphates is a widespread function amongst human polymerases and many other human proteins. The history of antiviral development and specifically HCV drug development holds multiple examples of nucleosides terminated due to their toxicities and in many instance, these toxicities have been linked experimentally to interaction with host proteins and/or the chemical nature of the phosphorylated nucleoside itself.

While there are certainly examples of very safe nucleoside antiviral drug, as an inherent property of the class, nucleosides have historically being associated with safety challenges more often than not. In contrast, non-nucleosides as a class offer the advantages of addressing a target without close human counterparts and possessing little chemical similarity to host metabolites. The non-nucleosides can have pharmacological advantages relative to other classes as well.

So long as a specific site of action offers the potential of attractive binding interactions and the medicinal chemistry campaign to invent the non-nucleoside took full advantage of that potential. Anadys elected to focus on the Palm 1 side based on the belief that the physical and chemical nature of this site offered a rich palette of binding interactions to draw upon, thereby offering an opportunity to optimize pharmacokinetics and potency while avoiding a need to rely on undesirable pharma support.

As a corollary, the opportunity to engineer excellent pharmacokinetics into the non-nucleoside provided a basis to create a significant pharmacological barrier to resistance. The clinical results with ANA598 validates this analysis and the selection of Palm 1 data as an attractive binding site for development of anti-HCV agents. To summarize, the intrinsic properties of non-nucleoside as a class and Palm 1 binding side in particular suggest that the non nucleoside mechanism may inherently be one of the most attractive mechanisms for HCV antivirals and the data today for ANA598 clearly supports this idea.

Consistent with the potential of non-nucleosides as a class, there has actually been a great deal of effort in the industry in the search of attractive non-nucleosides. Slide eight shows a list of non-nucleosides that have been explored clinical in HCV. You can see that the list is extensive and represents most of the major pharmaceutical companies active in the HCV area. This substantial effort validates pharma's belief that non-nucleosides are an attractive class of agents and suggest that interest should be high in a non-nucleoside with positive clinical data demonstrated through 12 weeks. Before we take questions, let me summarize the data today for ANA598 that demonstrates many of the positive features we believed inherent in the non nucleoside mechanism at the offset of the program.

The antiviral potency of ANA598 is reflected in the accelerated rate of patients achieving undetectable level of virus compared to standard of care alone, 73% at week 12 for the 200 milligram bid cohort and 72% at week eight for the 400 milligram bid cohort. The potential for superior pharmacokinetics we believed inherent in the Palm 1 binding site is validated by ANA598's half-life, 24 to 30 hours. And the benefit conferred by this feature, the pharmacological barrier to resistance as evident by the durability of response.

We believe ANA598's long half life will take on even more significance in real world use, offering forgiveness for missed doses that may not be available to drugs restored to half life that are taken more frequently or/on strict schedule. Lastly the favorable safety and tolerability profile of ANA598 today are consistent with a lower risk of off target binding compared to other classes with more checkered history of clinical safety. And this favorable profile enhances the chances of effectively combining ANA598 with other safe and potent direct antiviral. Related to this potential for combination regiments, we have completed chronic toxicology studies which enable clinical dosing for as long as a year.

We believe this opportunity could be especially important in testing interferon-sparing regimens with the ability to dose longer than 12 weeks may increase the chances of maintaining on treatment antiviral response through durable sustained viral response or SVR. With the demonstrated antiviral response and clinical safety results through 12 weeks as well as the toxicology and preclinical biology results we've described we believe that ANA598 is not only ready for trials exploring combinations with other direct antiviral but that in fact ANA598 is one of the most attractive assets with which to form such combination. We will stop here and take questions.

Question-and-Answer Session

Operator

(Operator Instructions). Our first question comes from the line of Edward Tenthoff with Piper Jaffray.

Edward Tenthoff - Piper Jaffray

Great. Thank you very much and congrats on the good data at the EASL. Steve, just looking kind of hypothetical or conditional terms that 598 should be attractive as a non-nuke, and I appreciate that overview on kind of where non-nukes stand. Give us an update on kind of what the interest has been from the partnering side post-EASL and just specify what your expectations are there?

Steve Worland

Yeah and so I think as we reported on our fourth call, we reengage in active level of dialog with companies. Can’t give too much detail there other than to say we certainly had a very active EASL meeting, meeting with a number of parties who were reviewing data through the eight week time point and expect to share with them 12 week data. Again I think as those discussion progress, we'll be in position to report something out concrete when we have something to say.

Edward Tenthoff - Piper Jaffray

And just following up on the [rash] little bit, you mentioned that there is a significant amount of [rash] to with ribavirin and standard of care therapy. How is the rash seen with 598 different? Is there any way to really kind of weed out what's 598 effect and what is really just the underlying ribavirin rash?

Jim Freddo

And we have discussed with investigators and opinion leaders what we have seen thus far and the bottom line is they cannot tell a difference between the macular (inaudible) rash that we are seeing in patients who have happen to be in the ANA598 arm and the rash that they typical see caused by ribavirin.

Edward Tenthoff - Piper Jaffray

Just one last quick question. When it comes to kind of the IL-28 genotyping, which was such a big topic at EASL, how are you guys looking at genotypic data in ongoing studies and how do you see that as playing a role for the future of 598 and HCV in general?

Jim Freddo

While I can tell that we are testing for the IL-28B genotype in the patients who are involved in this Phase II study. How is that going to play out in the future in terms of predicting who will respond etcetera nobody has reported any data for combinations including direct acting antiviral as yet. And so we'll just have to see how that plays out.

Operator

Next question comes from the line of Brian Abrahams with Oppenheimer, please proceed.

Brian Abrahams - Oppenheimer

I actually just want to follow up on one of Ted's questions regarding rash. How did the severity and the time course of the rash differ for the 400 mg versus the 200 mg arm? Were there substantial differences? I know you had the one additional grade three, but how did those look?

Jim Freddo

So in terms of the time course based on the data that we’ve seen so far the time course looks similar between the three arms. So the standard of care plus placebo arm relative to the 200 milligram through week 12. Remember we only have the 400 milligram safety information through week eight but in terms of the time course very similar. And what was the other part of your question Brian?

Brian Abrahams - Oppenheimer

The general severity.

Jim Freddo

So if again if you look at what we presented on the poster, the severity most of the patients who developed rash in any of the arms was mild. And as you said we had one grade three at 200 milligram bid through week 12 and one grade three through eight weeks in the 400 milligram dose group.

Brian Abrahams - Oppenheimer

Overall the general severity?

Jim Freddo

So if you again look what we presented on the poster the severity most of the patients developed rash in any of the arm was mild. And as you said we had one grade 3 at 200 milligram BID through week 12 and one grade 3 through 8 weeks in the 400 milligram dose group.

Brian Abrahams - Oppenheimer

Okay. And then, Steve, at the end of your prepared remarks you mentioned that you've got a year of chronic tox studies and could potentially look at 598 in a STAT-C combo without interferon. Based on the time course of the rash that you've seen in the prior studies, what do you think that the longest you'd be able to dose 598 for would be?

Jim Freddo

Just as a reminder to others on the phone, so the chronic tox studies that we’ve conducted is a six month in rat and the 9 month in monkey and having those chronic toxicology results in hand, we'd be very comfortable dosing ANA598 all through 48 weeks if that’s desirable in certain patient population.

Steve Worland

And I think the clinical safety support that as well. I think so we are in a position to do in from a animal point of view and we are comfortable doing it from the clinical safety that we are seeing doing it dosing out for as long as 48 weeks.

Brian Abrahams - Oppenheimer

Okay. And then, lastly, then I'll hop back in the queue, you mentioned where you might expect the 400 milligram arm to track between weeks eight and 12, but what about the control arm? Looking at historical late response rates for peg interferon and ribavirin, where should we expect the undetectable rate to be for the control arm by week 12?

Jim Freddo - Chief Medical Officer

I don’t want to predict what results we will have in week 12 for the complete placebo control arm based on the what we’ve seen in the second half of that control group. It certainly appears to be considerably less than we saw in the first half of the control patients and I expect the results to be more in line with historical rates which range from 40 to 60%

Operator

Our next question comes from the line of Phil Nadeau with Cowen & Company, please proceed

Phil Nadeau - Cowen & Company

Good afternoon. Thanks for taking my questions. Steve, my first is for you. You mentioned several times in your prepared remarks how it looks like 598 is a good candidate to be combined with other agents. Are you putting together any plans to look at this in combination with other agents in advance of your partnership or what not in Q2, Q3, or are you just making the case that this could be combined and allowing the partner or acquirer to make the decisions on how to go forward itself?

Steve Worland

Again from the basis of doing those combination we have the preclinical biology and the tox data that Jim referred to support those combination. In terms of from a business point of view I think our approach that we believe that ANA598 is a very valuable asset and we won’t just simply make it available for free to people to play around. We expect to receive consideration for the value we created in ANA598 by pushing the program as fast and as far as we have.

Phil Nadeau - Cowen & Company

Maybe one last question is just on the disclosure of the final data. Will you simply put that out in the press release when it's available in May, or is there anything that you're going to withhold for a medical meeting?

Steve Worland

I think we intend to release certainly the significant top-line data in the later half of May.

Operator

Our next question comes from the line of Katherine Xu with Wedbush Securities. Please proceed.

Katherine Xu - Wedbush Securities

Steve, just wondering, or Jim, have you guys reported the 1a versus 1b?

Jim Freddo

Yes, so, we have not broken it out but if you look at the demographic slide that Steve had up earlier, you’ll see that the predominance of patients in all three arms is genotype 1a, its 75% or greater in each one of those three arms. So, we’ve not broken it up.

Katherine Xu - Wedbush Securities

And for that one patient who never responded in the 200 mg bid, any hypothesis there? And also do you have the sequencing data so far?

Jim Freddo

Yes, so the hypothesis does relate to the sequencing data which we do not have in hand as yet. We expect to get sequencing data some time in the next few weeks.

Operator

(Operators Instructions). Our next question comes from the line of Ren Benjamin from Rodman. Please proceed.

Ren Benjamin - Rodman

Looking at the viral kinetics slide, can you maybe give us some idea as to why the 400 mg group seems to have a delay compared to the 200 mg group? I mean, is it just maybe something having to do with the small numbers as far as viral clearance is concerned at the earlier time points, or is there another conclusion that we can make, and maybe going forward all you'll evaluate is the 200 mg dose? Can you just maybe speculate on that a little bit?

Jim Freddo

I’ll actually start by what you said at the end of your question. We’re very comfortable with the efficacy and safety data from both doses, so we wouldn’t exclude taking 400 mg bid into future studies based on what we’ve seen to date. And it maybe a good dose for bringing forward into certain regimens and certain population. Regarding the difference between the 200 mg and 400 mg cohorts, I'd say the majority of it is probably related to small numbers, though when we look at the base line viral load, there are a few patients in the 200 mg bid cohort who did have lower viral loads then we see in the other two arms and it maybe because we had a few patients at the lower end in terms of base line viral load that we saw more rapid achievement of undetectable levels of virus in the 200 mg bid cohort.

Ren Benjamin - Rodman

And regarding the control group line, I think it was in red, that you showed, was that the combination of both the placebo groups from the 200 and the 400?

Jim Freddo

That’s correct.

Ren Benjamin - Rodman

As of the eight weeks?

Jim Freddo

Correct.

Ren Benjamin - Rodman

But can you give us any sort of an update or any sort of a feel as to what is happening with the 200-mg group as we're following those patients out much longer? What's the furthest we've followed out some of these patients, and is there anything you can comment on regarding the curves?

Jim Freddo

There is nothing I can comment on in terms of how the patients are doing with viral load beyond the 12 weeks. So, I can say that those patients who would have stopped at week 24 have already reached that time point, so we expect to see data from that, those first patients that would have been randomized to stop at week 24, some time in the next few weeks.

Ren Benjamin - Rodman

Okay, and will you be announcing that, as well, with the updated 12 week data from the 400-mg group?

Steve Worland

Ren, the next data point we’ll see from them, the SVR data, so remember this is a small group of patients but the first patients who have randomized to stop have stopped as Jim said. We’ll begin to see SVR12 from notations in the third quarter and SVR24 in the fourth quarter. That's the next data point that we expect to release on those patients.

Ren Benjamin - Rodman

Can we go through just the milestones maybe for the next 12 months or so, just in chronological order?

Steve Worland

I think the most important data for 598 beyond what we’ve already released is the conclusion of the antiviral response, that 12 weeks that we expect to have in the latter half of May and then we mentioned SVR data for in the Q3 and Q4 for the first group that would have been stopped. That’s an interesting data but again those are relatively small patient population. So, really we think the profile 598 established through the 12 weeks will be available on the latter half of May and that I think is very important for us to continue to do business progressions that we are in, continue to get value recognized for 598 program where it is today and see it continue to push forward in development.

Ren Benjamin - Rodman

We know how partnership talks wind up lasting longer than expected. Can you talk a little bit about what next steps might be and when that might occur? So, for example, would you wait until all the data is in before planning the next trial, or would you, sort of based on the SVR data, go ahead and start planning the next trial? What might the next trial look like?

Steve Worland

Well, so I think, first just from a clinical planning point of view, we actually have the data very shortly to go ahead and start planning next trial. So, knowing the safety and antiviral response through 12 weeks of 200 mg and 400 mg positions up to design the next trial. In terms of discussions again think as I said at the outside of the call really we need to be a position just to report to you something concrete when we have something to say there recognizing that we are at engaged level of dialogue around 598 in HCV community.

Operator

As there are no further questions. I’d like to turn the call back to Dr. Worland for any concluding remarks.

Steve Worland

Thank you again for listening today. We are very pleased with the results today and believe that these results position ANA598 as one of the most advanced and attractive polymerase inhibitors in HCV development today. Thank you.

Operator

This concludes the Anadys Pharmaceuticals’ first quarter 2010 conference call. You may now disconnect.

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