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Arrowhead Research Corp. (NASDAQ:ARWR)

Q3 2014 Results Earnings Conference Call

August 12, 2014 4:30 PM ET


Vincent Anzalone - Vice President, Investor Relations

Dr. Christopher Anzalone - President and CEO

Dr. Bruce Given - Chief Operating Officer and Head, R&D

Ken Myszkowski - Chief Financial Officer


Michael Yee - RBC Capital Markets

Alethia Young - Deutsche Bank

Thomas Wei - Jefferies


Ladies and gentlemen, welcome to the Arrowhead Research Fiscal 2014 Third Quarter Financial Results Conference Call. Throughout today’s recorded presentation all participants will be in a listen-only mode. After the presentation, there will be an opportunity to ask questions.

I would now hand the conference over to Vincent Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.

Vincent Anzalone

Thank you. Good afternoon, everyone. And thank you for joining us today to discuss Arrowhead’s results for its fiscal 2014 third quarter ended June 30, 2014. With us today from management are President and CEO, Dr. Christopher Anzalone; Chief Operating Officer and Head of R&D, Dr. Bruce Given; Chief Financial Officer, Ken Myszkowski. Management will provide a brief overview of the quarter and we’ll then open up the call to your questions.

Before we begin, I would like to remind you that comments made during today’s call may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

All statements other than statements of historical facts, including without limitation those with respect to Arrowhead’s goals, plans and strategies, are forward-looking statements. They represent management’s current expectations and are inherently uncertain. Thus actual results may differ materially.

Arrowhead undertakes no duty to update any of the forward-looking statements discussed on today’s call. You should refer to the discussions under Risk Factors in Arrowhead’s annual report on Form 10-K and the company’s quarterly reports on Form 10-Q for additional matters to be considered in this regard.

With that said, I’d like to turn the call over to Dr. Christopher Anzalone, President and CEO of the company. Chris?

Dr. Christopher Anzalone

Thanks, Vince. Good afternoon, everyone, and thank you for joining us today. The fiscal third quarter in recent period have been exciting and productive times for Arrowhead. We continue to push forward rapidly with our product developments and pipeline expansion goals, and now have two drug candidates in or approaching the clinic and a handful of other undisclosed program that are progressing nicely.

Let’s begin with our lead candidate ARC-520 for the treatment of chronic hepatitis B infection. I’ll provide some highlights and later in the call Bruce will provide more detailed information.

As you know, earlier this year we initiated a dose finding Phase 2a study designed to inform a multi-dose Phase 2b study. Our two primary goals were to identify a dose that, A, induces a 90% reduction of circulating s-antigen after a single administration and B, provides durable enough knockdown to enable once per month dosing. Given our studies in multiple animal models, we were quite confident that we could achieve this, but just did not know what that dose would be in humans.

Our interim results have been extremely exciting. We completed dosing of 1 and 2 milligrams per kilogram in June and those studies still blinded, several important conclusions may already be drawn. We are seeing clear knockdown in both groups and duration of that knockdown has been substantially longer than we expected.

We currently have data from the 2 milligrams per kilogram cohort as far out as two months after dosing and in these patients we perceive -- and in the patients we perceive as having received ARC-520, we still see substantial knockdown at this time point.

Interestingly, some of those patients may have s-antigen levels that are still declining, safety profiles in both group were also at least as good as those seen the Phase 1 study. Because of the favorable safety profiles in volunteers and patients, and because we thought we could demonstrate even deeper knockdown, we decide to explore 3 milligrams per kilogram in patients. We have begun dosing that cohort. We see substantial opportunity to demonstrate deep knockdown because of the steep dose response curve observed in non-human primates.

We also see limited downside risk at this dose, because we completed a 3 milligrams per kilogram cohort in healthy volunteers and that safety profile was quite positive consistent with all other groups tested.

We view this emerging data from the Phase 2a study as very important for the HBV field, where to my knowledge clear and consistent reduction of s-antigen in humans have never been demonstrated.

This preliminary data are also important in broader RNAi field because they suggest a uniquely long duration of activity in human. This not only speaks to the potential power of our 520, but also to that our future candidates built on the DPC platform.

At this point, during the quarter we nominate our second clinical candidates using DPC delivery, ARC-AAT and hosted an Analyst Day to present preclinical data. ARC-AAT is designed to treat liver disease associated with a genetic disorder called Alpha-1 Antitrypsin Deficiency or AATD.

This is easy to characterize by the production of mutant form of the enzyme Alpha-1 Antitrypsin that cannot be properly exported from the parasites. The non-mutant form or native form -- or native form of Alpha-1 Antitrypsin protects lungs from inflation. So AATD causes lung damage due to lack of the native enzyme in circulation.

It may also cause clinical liver disease because accumulation of mutant Alpha-1 Antitrypsin partisan can lead to cirrhosis and hepatocellular carcinoma. It’s thought that there are approximately 100,000 people in the U.S. with the most severe form of AATD and while they are well-established therapies to treat pulmonary sequalae. There are no approved therapies for liver disease associated with AATD.

This belief is stopping the production of mutant unexported enzyme will halt the progression of AATD associated liver disease and reverse prior fibrosis associated with it. For these reasons, we believe this is a substantial unmet medical need that we can address effectively.

We have generated impressive data sets in animal models and are moving quickly toward the clinic. We are on track to file to commence clinical studies for ARC-AAT by the end of calendar 2014.

During the quarter we also announced that we signed an agreement with the Alpha-1 Project or TAP, the venture philanthropy subsidiary of the Alpha-1 Foundation. Under the terms of the agreement, TAP will provide funding for the development of ARC-AAT, make its scientific advisors available to Arrowhead, assist with patient recruitment for clinical trials and engage in other collaborative efforts to support the development of ARC-AAT.

The Alpha-1 Foundation is an extraordinarily well-organized and sophisticated patient advocacy group, so we view TAP funding as validation for our program and gateway to an effective partner for clinical program and ultimate product with lab.

Overall, we continuously demonstrate rapid and effective execution of our product development programs and we have clearly made great strides in the recent period. Our clinical data are tracking our field leading non-clinical data and I believe we are increasing our first mover advantage in HBV. Similarly, we are well-positioned as leaders in liver disease associated with AATD and I expect that advantage to continue.

With that overview, I’d now like to turn the call over to our COO and Head of Development, Dr. Bruce Given. Bruce?

Dr. Bruce Given

Thanks, Chris, and good afternoon, everyone. For those of us developing new platform there is nothing more exciting then taking them into humans for the first time. ARC-520 is that product for us.

As you know, that process started in normal volunteers last year, that study was designed to assess doses up to 2 mg per kg and was reported at the end of last year to show no premature discontinuations, no serious adverse event, similar rate and severity of mild or moderate adverse events for placebo and ARC-520 subject and no laboratory or other safety parameters looking to us or the investigator like end organ toxicity.

We did note a flush in reaction at point 6 mg per kg and an urticarial rash at 2 mgs per kg, both in our ARC-520 treated patient. Those seemed like histamine-related events to us, so we repeated the 2 mg per kg but with pretreatment with an over-the-counter oral antihistamine.

This dose cohort also went smoothly and no skin related AEs were absorbed. With this data in hand, we design the first in patient study with chronic HBV patient in Hong Kong where disease prevalence is high. The protocol doses were 1 and 2 mgs per kg and this was our first opportunity to not only assess safety and tolerability in patients, but also to assess gene knockdown.

We wanted to isolate HBsAg or surface antigen as the parameter of interest, so we conducted this trial in patient negative for key antigen in our chronic entecavir therapy with a detectable circulating viral DNA. This is the first report of those results.

As Chris mentioned, the trial was ongoing and still blinded. As in the normal volunteers, the treatment has been well-tolerated. There have been dropouts and no serious adverse event.

The overall rate of AEs has been even lower than in the normal volunteers and nothing added the ordinary has occurred. Safety labs continue to lack indication of end organ toxicity. These patients have received oral over-the-counter antihistamine and no skin reactions have occurred.

While the trial is still blinded, we've been able to review anonymized profiles for individuals surface antigen level. The 1 mg per kg dose showed clear activity at a modest level. We have surface antigen data for all patients into 2 mg per kg dose group through six weeks and for five of eight patient's we have data through eight weeks.

Again with the caveat that the data is still blinded we believe the knockdown is clearly deeper in this group versus 1 mg per kg and at eight weeks the patients we perceive is having received active drug so surprisingly large reductions in surface antigen.

Overall, duration of knockdown appears to be substantially more sustained in humans compared to the non-human primates we have studied at the same doses. For the depth of knockdown appears to be similar in magnitude with what we see in non-human primates of same doses, including the HBV infected chimpanzee presented at AASLD last year. We think that we are right around the middle of the ascending part of dose response curve at the 2 mg per kg dose.

When the surface antigen data started to emerge we saw the potential to expand the dose finding study and explore dose at higher than 2 mgs per kg in patient. In preparation for that, we enrolled a 3 mg per kg cohort and are still open normal volunteer study. This dose also performed well without detected differences from safety and tolerability results at other doses.

Overall AEs do not appear to be increasing in frequency or severity with dose. With this safety data in hand, as well as from the Hong Kong patient, we amended the Hong Kong study to include a new 3 mg per kg cohort. This amendment has been approved by both Hong Kong site IRBs and the study DSMB also recommended going forward. This cohort is now dosing.

So how should we think about these results? The dose range for knockdown in humans appears to be similar to that seen in non-human primates, including the previously reported HBV infected chimpanzee.

In all of our animal species studied so far, the dose response curve for DPC-assisted RNAi triggers has been steep, assuming this holds for human and we think it will, the 3 mg per kg dose is likely to give deep knockdown.

Given what we've already seen at 1 and 2 mgs per kg, we would expect the knockdown to be prolong, well beyond 30 days and likely even longer than predicted by non-human primate model. This suggest that we will be able to explore dosing less frequent than once per month in Phase 2b.

We think this data bode well for our upcoming Phase 2b study which I want to talk about briefly. Our current plan is to initiate a study in the fourth quarter that will test two dose levels in e-antigen negative anti-antigen positive patients on entecavir or tenofovir. It will be multi-dose placebo-controlled study conducted in the United States, Western Europe and Asia with the long-term extension.

Our primary endpoint in the extension will be achieving a functional curing patients characterized by s-antigen clearance with or without sero-conversion. We consider these are core or anchor Phase 2b studies. We also plan to initiate a number of smaller exploratory studies in 2015, including various dosing regimen and study of ARC-520 in combination with immunostimulatory agents.

The core Phase 2b an additional exploratory studies aim to provide us with a comprehensive understanding of ARC-520s activity in a broad range of setting and we believe will allow us to expand our leadership position in HBV.

Let’s now turn to ARC-AAT, as Chris mentioned, we have generated impressive non-clinical data. In animal model, the ARC-AAT has been highly effective at knocking down the Alpha-1 Antitrypsin gene transcript and reducing the hepatic production of the mutant AAT protein. In PiZ mice, which are genetically modified to produce the mutant human AAT, ARC-AAT induced a greater than 95% reduction in circulating AAT level after a single dose.

After eight weeks of treatment in multiple dose studies, soluble which is the monomeric and insoluble which is the polymeric forms of Z-AAT were greatly reduced in the livers of PiZ mice treated with ARC-AAT. In addition, liver globule burden was substantially reduced from baseline levels and in comparison to treatment with saline, which showed progressive globule formation.

In primate studies, which was discussed earlier, appear to be predictive of the response in humans. Knockdown of AAT in serum persisted for over 10 weeks with greater than 80% knockdown still observed at the six-week time point.

Keep in mind that AAT is produced extrahepatically as well and ARC-AAT only targets that AAT, which is produced in hepatocytes. So what we observed likely translates into multi-log knockdown in the target hepatic cells. We’ve initiated the final steps required to file for initiation of human dosing, including necessary toxicology studies.

With that update, I would like to turn the call over to our, CFO, Ken Myszkowski, to review our financials for that period. Ken?

Ken Myszkowski

Thank you, Bruce and good afternoon everyone. As we reported today, our net loss attributable to Arrowhead for the three months ended June 30, 2014 was $11.6 million or $0.22 per share based on 51.9 million weighted average shares outstanding. This compares with a net loss attributable to Arrowhead of $6.1 million or $0.23 per share based on 26.1 million weighted average shares outstanding for the three months ended June 30, 2013.

Total operating expenses for the three months ended June 30, 2014 were $12.7 million compared to $6.4 million for the three months ended June 30, 2013. Research and development related expenses were $6.4 million while G&A cost were $1.6 million.

The increase in operating expenses compared to the prior year period are due to ARC-520 clinical trial, related ongoing toxicology studies and drug manufacturing costs in preparation for Phase 2 clinical trials. Additionally, last year or last quarter, we nominated ARC-AAT as a clinical candidate and have incurred cost related to preclinical toxicology and manufacturing as we prepare to enter the clinic.

We expect these expenses to continue to increase as ARC-520 enters Phase 2b much larger clinical trial and as ARC-AAT enters the clinic. In addition to outside cost related to clinical trials, operating expenses increased due to higher headcount, primarily research and development personnel, as compared to the prior year.

Net cash used in operating activities for the first nine months of fiscal 2014 were $24.5 million compared with $13.6 million in prior year period. Increase in cash used in operating activities is consistent with the change in operating expenses.

Turning to our balance sheet, our cash balance at June 30, 2014 was $138.3 million, including short and long-term investments and fixed income securities. Our cash and investment balance was $188.5 million at June 30, 2014 compared to $29.8 million at September 30, 2013.

The increase reflects the financings completed in October 2013 and February 2014. Additionally, the company received cash inflow of $12.4 million from the exercise of stock options and warrants. Our common shares outstanding at June 30, 2014 were $52.9 million and there were also 21,000 shares of preferred stock outstanding.

These preferred shares are convertible into 5.6 million shares of common stock. Common shares outstanding including the conversion of our preferred shares will be 58.5 million.

With that financial overview, I will now turn the call back to Chris.

Dr. Christopher Anzalone

Thanks Ken. We’ve begun a very exciting phase, characterized by the transition from a science-based company that is full of promise to a drug company providing real benefits to patients. Until now, we had demonstrated exciting data in animal models, some of the most dramatic in the field and a good safety profile in healthy human volunteers. We are now taking the next leap forward with ARC-520 by expanding emerging positive safety profile in more patients at higher dose and generating knockdown data in patients.

We have seen unexpectedly durable knockdown in humans, reinforcing our belief that DPC is our best-in-class delivery for RNAi and suggesting that ARC-520 may ultimately be dosed less frequently than monthly. We’re also seen depth of knockdown that is similar to that verdict in animal models to suggest that primates or indeed mice are good models predicting dose and effective in patients for our technology. It is the clinical insight that we expected but can only confirm by observing knockdown directly in human subjects. This allows us to move forward with our entire R&D program with greater confidence and speed.

Our newly disclosed, ARC-AAT program continues to move forward as expected and ARC-520 human data validate and de-risk it. We have executed on our goals during the quarter, and are committed to continuing that in the periods ahead. Some of our upcoming goals include the following, we’ll present additional clinical data on Phase 2a study of ARC-520 around AASLD this year and additional non-clinical data on ARC-AAT at press release and a key scientifical medical meetings in the fourth quarter.

We’ll file in the fourth quarter to initiate first in man studies for ARC-AAT. Also in the fourth quarter, we plan to initiate the core Phase 2b studies for ARC-520. Throughout 2015, we plan to initiate multiple pilot or exploratory clinical studies of ARC-520 to look at dose schedules and combinations that may improve cure rates.

Also in 2015, we intend to nominate one or more additional clinical candidate, which we will talk about more in the future. So as you can see, we’re working on a lot of projects that we believe will add substantial valuable in the long term as well as the near term.

I would now like to open the call to your questions. Operator?

Question-and-Answer Session


(Operator Instructions) Our first question comes from Michael Yee of RBC Capital Markets. Your line is open.

Michael Yee - RBC Capital Markets

Yeah. Hi. Good afternoon. Thanks guys. A couple of questions, first on your ongoing Phase 2a study. You should have qualified 1 mg and 2 mg curves, people are implying that 2 mgs is around 0.8 log reduction like the animal study. But what is your confidence that 3mgs is going to be greater than 0.8. Are you just comparing that to the current time point and the drop you’ve seen in the time point in the 2 mgs. How confident are you that, that will be greater than a 1 mg -- excuse me, 1 log?

And then going forward, since we’re trying to ultimately get functional here in the Phase 2b study, how confident are you in a functional cure if you’re not above 1 log. And how many doses will you get and what time points are you looking at your -- to actually look at the functional cure?

Dr. Christopher Anzalone

Sure, I’ll take a crack and I’ll hand it over to Bruce as well. Regarding our confidence level in achieving the log knockdown with 3 mgs/kg, we feel pretty good about that. What we saw in one 2 mgs/kg is that the depths of knockdown seems to track reasonably well with non-human primate models. But of course the durability of the fact is, it’s substantially longer. And so that that gives us -- that gives us good confidence that 3 mgs/kg will give us good deep knockdown.

But until we just don't know until we’re in-humans and the fact of the matter, this is the dose-binding study. And so from my perspective, I really don't care what the dose level is that gets us that that goal as long as we get there safely. And it looks like we have plenty of room in terms of safety. We haven't seen anything that that has been concerning any of the groups.

So if we need to go to 4mgs/kg, for instance, we think we have got plenty of room to do that. In fact, to ensure that we’ve got -- that we can do that in a timely fashion, we decided to go ahead and initiate a 4 mgs/kg group in healthy volunteers, which we may or may not use to move into 4mgs/kg in patients but it’s a good thing how we figured.

Regarding our confidence in achieving the functional cure that is the fill in the blank number of dollars question. We are for good or for bad pioneers in this field and we are doing something now. In fact, we have already done something now the world has never seen which has deep and sustained knockdown and consistent knockdown of s-antigen in humans. So that’s the first hurdle that we appear to be getting over right now.

And now we will be the testing the theory that are KOLs and frankly the vast majority of KOLs that we speak with believe to be true, which is, if you knockdown s-antigen, you can enable immune system to come back and clear the virus. We’ll see that. I suspect that we’ll start to, if in fact, this drug work as we all hope and expect it does, I expect that we could start to see some functional cures in 2015.

But again that’s just speculation and only time will tell. Bruce, do you have anything to add on that?

Dr. Bruce Given

Just a couple of fine points. Michael, thanks for your question and good questions as always. First of all, I mean, what do we expected to see at 3mgs/kg. Will we see a log as a number, it’s little bit hard to say. I mean, the one thing that we can say is that with all of our RNAi programs across mice, rats, primates, the one thing that we have consistently seen is the various deep dose response curve.

Frankly, having been in the industry a long time, these are the steepest dose response curve I’ve ever seen. And I think it just has to do with the catalytic nature of risk and how the process works. But from my perspective, if in human, it is similarly steep then I think we’re going to be in good shape at 3mgs/kg.

If as Chris said, if it’s little bit more shallow in humans then we just don’t know yet because we only have two points that’s enough for curve. But if it’s a bit more shallow, we could wind up having to go to 4mgs/kg and that would be fine with us.

But if we are as steep as we’ve seen in primates and other species, the chances are pretty good that 3mgs/kg gives us what we have been looking for. That’s item one. Item two, just to be a little more specific, the Phase 2b core studies are designed to last 12 weeks and then patients will roll into an extension. And that extension will take patients out to somewhere around a year of therapy. We don’t know if the theory is correct that you need to derepress these patients by reducing surface energy. We don’t know how long -- how long therapy needs to be for that to work.

And because of that, it’s hard to say as Chris said, we would hope that in the second half of 2015 that we’ll have some patients that have been on therapy for over six months at that point. And if the answer is with the kind of reduction, surface antigen that we’re providing is six months or so is long enough for body to come back, we could start seeing some functional cures. If actually it’s less, we could see them earlier and if it’s going to take a full year or if it’s even going to be a little bit like interferon, that derepresses and then takes a little bit time to come back, it could be a little longer, we just don’t know, Michael.

Michael Yee - RBC Capital Markets

Do you keep dosing them and you keep checking on them?

Dr. Christopher Anzalone

We keep those and we keep checking and in the long-term extension, the primary endpoint is as we’ve currently designed it [Technical Difficulty] current thinking about the principally or the primary endpoint would be that it will be s- clearance, with or without serum conversion and that will be the primary endpoint in the extension.

Michael Yee - RBC Capital Markets

Thank you very much.


Our next question comes from Alethia Young of Deutsche Bank. Your line is open.

Alethia Young - Deutsche Bank

Great, thanks for taking my question, and congrats on the progress. I just wanted to ask about the 1 log theory again. Do you still stand by the 1 log knockdown, if you're seeing a longer duration of response? And then the second question is, run us through like why you believe 1 log is irrelevant (indiscernible) time point period right now, when you're basically at maybe 0.8, 0.7 right now and then I have one quick follow-up.

Dr. Christopher Anzalone

Sure. It’s good question. Thanks very much Alethia. We think that that is an aggressive bogie and it is not clear to what we actually need to reach that level of knockdown. Having said that we think that we can certainly get there so we’re more comfortable if we have it. The reason that we have, we have stuck to that bogie, is that the only thing that gives any kind of (indiscernible) semi reliable functional cures is interferon. After a year of interferon, about 10% of patients will reach a functional sure and all those patients who do get to that functional cure will see about half a log reduction in s-antigen in around 12 weeks and around one log after 24 weeks.

So it’s not clear that that we need to reach that full log, but we do know that if at least under interferon therapy, if patient does not see that, sort of, s- reduction then there is no chance they will get a functional cure. So that's why that feels like a safe zone for us.

Now we will be seeing reductions in s- that there are far more rapid that you see in the handful of time we see it within interferon. And so those difference in kinetics may suggest that that we don't need to get a full log. But again, because we can do it safely, we felt most comfortable making that our goal.

Dr. Bruce Given

Keep in mind everybody that current design has two dose levels, against the placebo in the Phase 2b. One that we have thought would probably be somewhere in the neighborhood of capital log and one that would be somewhere in the neighborhood of the log. And it’s entirely possible while any outcome can occur. Having a -- half a log dose could do just as well as full log dose could do. And of course, it could always turnout that the s-antigen hypothesis is too simple and there’s something else needed as well.

But both of those groups are serious group, so those are both serious levels of knockdown. And keep n mind also that that’s based on what we see it as single dose. Under multiple-dose scenario, it’s entirely possible that there will be continuous step down on the surface antigen level as well.

Dr. Christopher Anzalone

And that maybe particular true in light of the recent data, showing that that we see a much of a durable knockdown in humans that we’d be doing…

Alethia Young - Deutsche Bank

Great. Can I ask my follow-up? Again with (indiscernible) dose, do you think you have that data by AASLD or do you think we’ll be waiting at the end of 2015 for that?

Dr. Christopher Anzalone

No. We believe we’ll have it during AASLD. Now we are hopeful that we will able to apply for a late breaker presentation and present it at AASLD. And so if that should work out then we hope to present it at AASLD. If not, at least, we feel pretty good that the data will come out around that time.

Alethia Young - Deutsche Bank

Okay. Great. Thanks.

Dr. Christopher Anzalone



Our next question comes from Thomas Wei of Jefferies. Your line is open.

Thomas Wei - Jefferies

Thanks. Just wanted to clarify a couple of things that you've said. First, the language in the press release and what you've reiterated on the call about the magnitude of the knockdown being similar to the non-human primate studies. So I guess what I'm a little bit confused by is that in the non-human primate studies, you actually gave two doses, 2 mgs/kg and 3 mgs/kg on day 1 and Day 15.

So when you're talking about it being similar for the six patients at 2 mgs/kg, who you think are on drug, are you seeing something that’s around a 0.7 log reduction? Like what the chimp got after two doses or are you talking about what the chimp experienced after the single 2mgs/kg dose, before she got her second 3mgs/kg dose?

Dr. Christopher Anzalone

Well, so Thomas, first of all we’re not just talking about chimp. We’re also talking generally about what we’ve seen in non-human primates across number of siRNA. And generally what yield is that that 2 mg/kg dose, if you look across our full experience, it tends not to be the maximal dose, tends to be sort of your somewhere in that broad middle range of the ascending part of the dose response curve.

When you get up to 3 mg/kg and higher, that’s when we tend to be up more at the top of the dose response curve and you start to get into the log and even multi-log levels, if that makes sense.

No. What we’re seeing is that we are at a part of the dose response curve that's quite easy to differentiate from no knockdown but that not yet [Technical Difficulty] that's really what we’re seeing.

We can't be a lot more specific in that because it’s still a blinded study and we don't know what certainty which two patients in each cohort have received placebo. We think we know who they are but we don't know the certainty.

Dr. Bruce Given

And we also -- it also appears that some patients are still declining in terms of s-antigen, particularly in s-antigen. So right now even if it was unblinded it will be premature to talk about peak knockdown because it not clearly speaks that.

Thomas Wei - Jefferies

Okay. But so the data that we have, maybe, I don’t have a full complete set of data, but we all have seen the data that you presented at AASLD in the one chimp. And then you're saying there are other non-human primate studies? Do we have the data for those other studies or has that not been presented before?

Dr. Christopher Anzalone

I’m not sure how much is actually they published, I think most of it in one way or another has probably been presented in places like tied. Not talking about things like Factor 7 and AAT, where we did show data at the Analyst Meeting that we had in middle of this year and so there is other data out there. Recall that for new world monkey HBV does not actually affect new world monkey.

So the only primary data we have for HBV happens to be the one chimpanzee and as you likely pointed out, we only have two week data for that chimpanzee at the 2 mg per kg dose.

So they were mostly talking about sort of the qualitative sense of the knockdown that was achieved there since we didn't follow it long enough probably even get to the nadir for a 2 mg per kg dose.

Thomas Wei - Jefferies

Right. I am still doing down and so you’re talking about kind of what would have been predicted if you have been able to follow that chimp out at 2 mg per kg for longer that 14 days. What you’re seeing is better than that? You’re seeing kind of what the natural extension of that curve would be, if that had been point out?

Dr. Christopher Anzalone

I think it’s fair to say that yes.

Thomas Wei - Jefferies

Okay. Sorry that, I have got confused about that. I also just wanted to ask about your commentary around the steepness? So when you keep talking about the steepness of the dose response curve, it sounds like you have a minimal amount of activity of 1 mg per kg and then you actually have much more robust activity at 2 mg per kg. So two is much more than twice as effective as 1 mg per kg?

Dr. Christopher Anzalone

We don’t want to get into a numbers gain. I think again that’s dangerous for us in those small parts because the data is still blinded. But what we’re talking about is that the nature of what we've seen across all of these different RNAs that we’ve studied and all these different species, is just always struck us that the dose response curve, at least for us, because of -- probably because of that fact that we have endosomal escape tends to be very steep. From the onset of knockdown to getting very high levels of knockdown tends to just be your couple 3 mg per kg. It’s not a factor of across 10 mg per kg. It’s something like we are seen in some. So it’s really very steep and we’ve just always been struck by that.

Dr. Bruce Given

And qualitatively, you're exactly right, when you’re on that your response curve. If you double the dose, you substantially more than double the response.

Thomas Wei - Jefferies

And that -- so you need that curve to continue along better than linear trajectory to meet your target, that what I should, I think you had mentioned that earlier during the Q&A that it need to continue along that very kind of super linear steep dose response to get your log?

Dr. Christopher Anzalone

Well, I think, we’d say the other way around. We would just say that, if it behaves the same way as we've seen in other species. We feel that the 3 mg per kg dose should give us very deep knockdown. That’s what we’re saying. But everyone wants to put nothing or have us put throw a dart at the dart board and say exactly what that knockdowns going to be. That’s a little hard for us.

But it feels like extrapolating for what we see with another animal model. The 3 mg per kg should be -- if it’s not a goal, it should be very near goal, would be our expectation, but now we get very forward looking. When we’re going to have the data in our hands and ready to show people around AASLD.

Thomas Wei - Jefferies

Okay. Great. Thanks. I’ll jump back in the queue.

Dr. Christopher Anzalone



(Operator Instructions) I’m showing no question at that this time. I would like to turn the call back over to Chris Anzalone.

Dr. Christopher Anzalone

Thanks very much for listening to the call today and we look forward to providing additional data going forward and we will see at the next call or at next meeting.


Ladies and gentlemen, thank you for participating in today's conference. This does include the program and you may all disconnect. Everyone have a great day.

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