Acrturus Therapeutics Holdings Inc. (ARCT) CEO Joseph Payne on Q2 2022 Results - Earnings Call Transcript

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Acrturus Therapeutics Holdings Inc. Q2 2022 Earnings Conference Call August 9, 2022 4:30 PM ET

Company Participants

Joseph Payne - President and Chief Executive Officer

Andrew Sassine - Chief Financial Officer

Pad Chivukula - Chief Scientifc Officer and Chief Operating Officer

Conference Call Participants

Pete Stavropoulos - Cantor Fitzgerald

Nick Abbott - Wells Fargo

Kumaraguru Raja - Brookline Capital Markets

Yale Jen - Laidlaw and Company

Yigal Nochomovitz - Citigroup

Steven Seedhouse - Raymond James

Operator

Good day and welcome to the Arcturus Therapeutics Second Quarter 2022 Financial Update and Pipeline Progress Call. Today's conference is being recorded.

At this time, I would like to turn the conference over to [indiscernible]. Please go ahead, sir.

Unidentified Company Representative

Thank you, Sara. Good afternoon and welcome to Arcturus Therapeutics Second Quarter 2022 Financial Update and Pipeline Progress Call. Thank you all for joining us. Today's call will be led by Joseph Payne, our President and CEO, and Andy Sassine, our CFO. Dr. Pad Chivukula, our CSO and COO, will join in for the Q&A session.

Before we begin, I would like to remind everyone that statements made during this call regarding matters that are not historical facts are forward-looking statements within the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of performance. They involve known and unknown risks, uncertainties, and assumptions that may cause actual results, performance and achievements to differ materially from those expressed or implied by the statements.

Please see the forward-looking statement disclaimer on the company's press release issued earlier today, as well as the risk factors section in our Forms 10-Q and 10-K filed with the SEC. In addition, any forward-looking statements represent our views only as of the date such statements are made, August 9, 2022. Arcturus specifically disclaims any obligation to update such statements to reflect future information, events or circumstances.

With that, I'll now turn the call over to Joe.

Joseph Payne

Thank you and good afternoon to all. Thank you for joining Arcturus' Q2 quarterly call. My comments today will begin with a brief summary of the business case for our vaccine platform, followed by highlighting our recent progress on our pipeline, including additional details per program before I turn the time over to Andy for financial updates.

Business case for our vaccine platform continues to mature and gain momentum. We begin by re-emphasizing our low dose level. A lower dose level of only five micrograms potentially means improved safety benefits and higher manufacturing related profit margins. Our vaccine platform is also devoid of an adjuvant and therefore captures all of the potential safety benefits and manufacturing simplicity associated with that.

In addition to the low dose of five micrograms and the simplicity of zero adjuvant, our vaccine platform utilizes Acrturus's lyophilization technology. We've now collected impressive cold chain data showing favorable stability, shipping and storage advantages that our lyophilized vaccines have relative to frozen liquid vaccines. Some of the critical challenges with presently approved COVID vaccines are related to durability and broad spectrum neutralizing antibody activity, especially with respect to the Omicron variants.

We believe that broadly acting and the potentially longer lasting self-amplifying mRNA booster vaccinations would further strengthen our business case for this platform. Indeed, the data we shared today in our press release continues to suggest that self-amplifying mRNA vaccines may be a superior next generation mRNA vaccine technology platform.

I will get to more details pertaining to that data shortly. This quarter has been highlighted by several key achievements including significant progress, advancing our pipeline of mRNA based vaccines and therapeutics. Let's begin with ARCT-154. This is our self-amplifying mRNA COVID vaccine candidate that has shown impressive activity against SARS-CoV-2 both as a primary vaccine and as a booster. Given the continued widespread circulation of SARS-CoV-2, and the anticipation of a long-term endemic phase, we continue to aggressively move forward with development of ARCT-154 as a booster vaccine.

We're pleased with the favorable results that continue to come from the ongoing Phase 1/2 study evaluating 154 in the U.S. and Singapore given as a five microgram booster dose, approximately five months after primary vaccination with Comirnaty. The boost with ARCT-154 generated robust neutralizing antibody responses that are sustained through three months after booster vaccination. The neutralizing antibody responses to the parent strain of the vaccine, also known as D614G and the antibody responses against a panel of SARS-CoV-2 strains have also consistently demonstrated antibody responses that have remained elevated over three months.

Now moving our attention to the present and more relevant Omicron variants. We're happy to share new data today from the ongoing analysis of this study demonstrating durable immune responses to both Omicron BA.1 and BA.2 variants. Against BA.2, we saw a 39 fold increase in neutralizing antibody titer at day 91 over baseline. This was complemented by a 44 fold increase in neutralizing antibodies against BA.1 at day 91. With these encouraging data, we have growing confidence in ARCT-154's profile as a booster vaccine. These data suggests that the broadly immunogenetic low dose and well tolerated features of our self-amplifying mRNA vaccine platform may compete effectively in a booster market currently dominated by vaccines with narrow SARS-CoV-2 protection and waning immunogenicity and at considerably higher doses.

Acrturus is presently collecting six month booster immunogenicity data for all relevant Omicron variants, including BA.5. We look forward to seeing that data soon and sharing it with our potential strategic commercial partners. Earlier this year, we learned from our collaborative Vinbiocare that the ARCT-154 Phase 1/2/3 study had met its primary endpoint objective of vaccine efficacy. The study demonstrated very strong protection against severe and fatal COVID disease even went up against the more challenging variants that have escaped other vaccines.

Supported by these collected data and the favorable results of the Vietnam vaccine efficacy trial, we have been in discussions with major regulatory agencies including the FDA, the MHRA and EMA, regarding the path to pivotal trial and future approval as a booster. Based on additional health authority guidance, the booster trial that was slated to start in Q3 has now been split into two smaller and more time and cost efficient trials, the first of which is expected to start in Q4.

With the updated study designs are intended to support global registration of ARCT-154 as a booster. The Vietnam Ministry of Health is undergoing a significant reorganization, resulting in a delay of the ARCT-154 EUA or emergency use authorization for the primary series. During this reorganization, the MOH or Ministry of Health communicated that the clinical section review is complete and adequate. The MOH provided comments to the CMC section and this is the chemistry manufacturing and control section requesting three manufacturing runs to support full market authorization.

ARCT-154 is now expected to receive EUA in Q4 2022, with full marketing authorization anticipated in early 2023, if booster studies meet non-inferior immunogenicity and safety objectives. Now the new stability data that was highlighted in our press release today, supporting the -- supported the advantages of using a lyophilized vaccine powder to mitigate the cold chain challenges associated with frozen liquid mRNA vaccines.

Our lyophilized COVID vaccine powder demonstrated room temperature stability for four days, that's 25 degrees centigrade in the presence of 60% relative humidity and refrigerator stability for six months, that's two to eight centigrade and a predicted long-term stability at minus 20 centigrade for 18 months. Transportation in the summer and winter months can provide temperature cycling challenges in the supply chain. This is where liquid products can be frozen or thawed unintentionally as you can appreciate.

And importantly, the lyophilized vaccine powder was not impacted by multiple temperature cycling stresses going from minus 20 to refrigerated temperatures like two to eight or room temperature and vice versa. This enables global shipping logistics and the supply of a stable usable, solid COVID vaccine product at two to eight centigrade. Taking these significant cold chain advantages into context with our low dose level, potential durability and broader spectrum of activity compared to conventional mRNA, our next gen self-amplifying mRNA platform continues to differentiate itself.

Our self-amplifying mRNA influenza vaccine has continued its preclinical work. We expect to make a final decision of our LUNAR-FLU development candidate this year. Given the comparative speed of mRNA vaccine production, and precise antigenic matching against circulating influenza strains, this is expected to offer an important improvement over currently marketed flu vaccines.

Comparatively lower dose, we believe that our approach may be differentiated in other meaningful ways as well. Now, I'd like to shift from our vaccine franchise over to our therapeutic mRNA pipeline programs, which continue to advance. I'll begin with an update on ARCT-810, this is our therapeutic candidate for Ornithine Transcarbamylase deficiency, or OTC deficiency. OTC deficiency as a result of a urea cycle disorder, it's rare and serious has no approved treatments that address the root cause of the disease. And our approach aims to augment the deficient OTC enzyme in the liver of these patients. ARCT-810 has the potential to restore urea cycle activity, prevent or slow the progression of neurological damage, and potentially expand dietary options and improve on the quality of life for people living with this condition.

We've obtained approval from the United Kingdom's HRA or Health Research Authority and other European authorities to initiate a Phase 2 multiple dose clinical trial for ARCT-810 designed to enroll 24 adolescents and adults. As many can appreciate, it is often challenging to find and identify rare disease patients. We are pleased to report that Arcturus has identified several dozen patients at multiple sites in the United Kingdom, Spain, and Belgium, with France and other countries soon to follow. We plan to screen and dose patients throughout the remainder of this year with the goal of obtaining interim proof-of-concept data by year-end.

We're pleased to report that ARCT-810 was recently granted orphan drug designation by the European Commission for the treatment of ornithine transcarbamylase deficiency. There are key incentives associated with this designation that include reduced regulatory fees for protocol assistance and marketing applications, the use of the centralized marketing authorization procedure, and 10 years of market exclusivity. This European designation complements the orphan drug designation by the U.S. FDA that this program has already received previously.

We have also completed dosing of the second cohort of our ascending dose Phase 1b study in the U.S., wherein the participants received a dose of 0.3 milligrams per kilogram of ARCT-810. The studies data safety review committee or DSRC has recommended continuation of the study and escalation to a higher dose cohort, which will begin dosing imminently.

Moving now to our cystic fibrosis program. We've continued to progress the necessary pre-clinical and non-clinical studies to enable ARCT-032 to move to the clinic. ARCT-032 is our inhaled messenger RNA therapeutic for cystic fibrosis. We recently presented at the European CF Conference in Rotterdam and had a productive update meeting with the CF foundation they are supportive collaboration partner for this program. And we anticipate the submission of a clinical trial application, or CTA for ARCT-032 in Q4 2022.

Well, with that, I will now pass the call on to Andy Sassine, our CFO to provide financial updates.

Andrew Sassine

Thank you, Joe, and good afternoon everyone. The press release issued earlier today includes financial statements for the second quarter of 2022 and provides a summary and analysis of year-over-year and sequential financial performance. Please reference our 10-Q for more detail on the financial performance. I will summarize our financials and then some operating metrics as we continue to transition to a late stage clinical company with several assets in our pipeline. I will also provide some details regarding our manufacturing strategy as we prepare for the potential of emergency use authorization in Vietnam. Finally, I will provide some insights regarding our cash position and expected run rate.

As you heard Joe mentioned, we remain productive in the second quarter, expanding on the highly encouraging efficacy trials and booster durability results for ARCT-154. As we have previously discussed, we partner to ARCT-154 next generation LUNAR COVID-19 vaccine candidate in Vietnam with Vinbiocare. Vinbiocare is part of the Vingroup, which is one of Vietnam's largest corporation and is sponsoring and funding our Phase 1, 2, 3 study in Vietnam targeting COVID-19. This partnership include the trial and collaboration around building a vaccine manufacturing facility in Hanoi, resulting in significant cost saving for Arcturus. Our technology transfer activities remain on track for the facility to become operational later this year with a potential capacity of over 200 million doses annually.

We are also continuing to work with other manufacturing partners to mature our global footprint including Europe, Japan, and the United States of America.

Revenues from strategic alliances and collaboration for the second quarter of 2022 with $27.1 million, a significant increase from the previous two quarters. This increase in revenue during the three months ended June 30, 2022 as compared to the three months ended March 31, 2022 was primarily due to revenues of $12.5 million related to the one-time recognition of reservation fees from the Israel Ministry of Health and an increase in revenues from Vinbiocare related to shipments of drug substance in the validation of their manufacturing facility.

The Vinbio manufacturing facility in Hanoi is anticipated to achieve commercial scale production capability in Q4 2022. Our operating expenses for the second quarter were $49 million. With declined quarter-over-quarter and would lower than the same quarter in the previous year. The decline in operating expenses was primarily due to a decrease in the clinical trial expenses related to ARCT-154.

In January 2020, the company entered into an agreement with a pharmaceutical company whereby the pharmaceutical company agreed to fund up to $25 million for a clinical trial for our ARCT-154 vaccine candidate as a booster. As of June 30, 2022, the company has submitted to the pharmaceutical company a bill of $1.9 million from a third-party related to the clinical trial. This bill falls under the expected funding of $25 million for the booster program.

We reported a net loss of approximately $21.6 million or $0.82 per basic and diluted share for the second quarter of 2022 compared to a net loss of $54.6 million, or $2.07 per basic and diluted share in the three months ended June 30, 2021 and a net loss of $51.2 million or $1.94 per basic and diluted share in the three months ended March 31, 2022.

Our cash balance at the end of the second quarter was $283.5 million. And based on our current pipeline, our cash position is expected to be sufficient to support operations into late 2023.

I will now pass the call back to Joe.

Joseph Payne

Hey, thanks, Andy. We're pleased to have another productive quarter, advancing our pipeline of mRNA vaccines and therapeutics and all the while judiciously controlling our operating expenses as was just nicely summarized by Andy. We remain highly encouraged about the potential of our clinical pipeline, and from our mRNA vaccine therapeutic platforms. We look forward to providing you with updates on our progress everyone.

I'll now turn the call back to the operator to field any questions.

Question-and-Answer Session

Operator

Thank you. [Operator Instructions]. And we'll take our first question from Yasmeen Rahimi with Piper Sandler. My apologies. One moment, please will actually take our first question from Pete Stavropoulos with Cantor Fitzgerald.

Pete Stavropoulos

Hi, its Pete Stavropoulos. Thank you. Thanks for taking my question. So one question I have is, is there any more details that you can share in terms of the trial designed for the booster? I know that you previously shared that it was going to be about 2,400 patients for one study. But you mentioned you're going to run two smaller studies. Can you provide in color on the size of the studies and possibly key differences? And will one or both studies be conducted perhaps with an Omicron specific strain by bivalent candidates? Any color would be appreciated?

Joseph Payne

Sure. That's a great question. Thanks, Pete for joining the call. Yes, we did emphasize that we're splitting bifurcating the single trial of 2,400 people into two smaller trials. We haven't communicated the exact number of those trials in the specific countries, but one will be emphasized on comparative immunogenicity and the other will be safety centric.

Pete Stavropoulos

Okay, and in terms of when you talk to the different agencies, do they want sort of a variation for a comparator arm? If they're asking for a comparative arm, meaning like no RNA base versus now we have protein-based vaccines is that are approved with [indiscernible] EUA in the U.S. and Europe?

Joseph Payne

Pad?

Pad Chivukula

Yes, I mean, we've had those discussions with various health authorities. And we will be using an active comparator rather, but we will provide more details on which vaccine we will be using as comparator at a future time.

Pete Stavropoulos

Okay, and if you don't mind, just one last question on the OTC program. Can you talk a little bit about that trial design, like know what type of patients you're enrolling? We'll be able to -- will they be on stable background meds? And if so, will you be enrolling control patients, uncontrolled patients both?

Joseph Payne

Yes, we know that they're adults. It's approximately 24 adults and adolescents as we've communicated. These are patients there. Yes. And they're relatively stable. But other details in that I don't have in front of me at this time. Pad is there other details you want to provide with respect to the patients in Phase 2 trial.

Pad Chivukula

Sure. Yes. And again the Phase 2 trial is a multi-dose trial. And we will be looking at all biomarkers associated with reduction of ammonia. We'll be looking at the enzymatic activity as well as ureagenesis in these patients. And we were, again, some of the things that we've done in our Phase 1 that we've talked about, we will be doing also in our Phase 2 trial. And we are hoping to see some changes in the biomarkers that we're monitoring.

Pete Stavropoulos

Okay. Thank you very much, and congratulations on all the progress.

Joseph Payne

Thanks, Pete.

Operator

Thank you. And next, we will move on to Yasmeen Rahimi with Piper Sandler.

Joseph Payne

Hey Yasmine?

Unidentified Analyst

Hi, This is Lauren on for Yas. Just a couple questions for the approval in Vietnam. So it's looking like the approval is contingent on the booster data. So could you provide a bit of color? Will you need two booster studies? And if that's so how large will they be? And what is the comparator? And then the second question is for the approval well, you need to have the data from the booster studies in 4Q, 2Q, how confident are you in that? And can you comment on the extent of the data you will generate? Thank you.

Joseph Payne

Sure, so well the first clarification is we will not, the prerequisite of booster data is required only for full market authorization not for emergency use approval. So just to make that clarification. What was the follow-on question? The size of the trial, we commented on with respect to the size of the trials it's smaller than 2400. So it's more cost efficient and faster to recruit and faster to complete by bifurcating the trial, so we haven't disclosed the exact numbers for each of these trials and the purpose again, one is going to be more immunogenicity focused with a comparator vaccine, and the other is going to be a safety centric.

Unidentified Analyst

Okay, fair.

Andrew Sassine

The question against the active comparator again, we mentioned in the previous question that we will be doing an active comparator trial, but we haven't disclosed which one.

Unidentified Analyst

Okay, great. Thank you.

Joseph Payne

Thank you.

Operator

Next we'll take our question from Nick Abbott with Wells Fargo.

Nick Abbott

Hello, good afternoon. Thanks for taking the questions. So the first one Joe is in the prepared comments you say that you will expect six months I think antibody data against BA.5, if I heard that correctly. So, have you seen one month, three month data against BA.5, can you comment on that? And should we be expecting to see this 40, 50 fold boost in NAB levels at three months for BA.5?

Joseph Payne

Yes, we should hope so. That'd be fantastic. We have not seen -- we have not seen any BA.5 data. We have seen BA.1 and BA.2 data that we've shared today in our press release. And what's notable about it is that it remains to be high, it doesn't have this potency drift that you see from other earlier vaccines. So we remain hopeful that we'll see a high geometric mean fold rise number, this GMFR number with BA.5. But we haven't seen any data. And it is correct that the data we're presently collecting is six months data for all variants, including BA.5, but also BA.1, BA.2, BA.4 and BA.5, okay.

Nick Abbott

Okay.

Joseph Payne

And that's coming.

Nick Abbott

Sorry.

Joseph Payne

Go ahead.

Nick Abbott

That sounds like you're promoting a movie, Joe. Just going back to the booster. So I get this right. So one study is going to be inactive, have an active comparator. So obviously, the N is divided by two or maybe it's two to one, I don't know. The other one is going to be safety centric. So that's going to be uncontrolled. That's just going to be whatever it is 1000 patients get the booster, is that the right way to think about it?

Joseph Payne

Yes, that is the right way to think about it.

Nick Abbott

And then I think there's a lot of personnel, whether you expect to get the data 4Q, you had a contract with a CRO, is it just a matter of sort of modifying that contract now, you don't have to start from scratch. You can start the studies pretty quickly.

Joseph Payne

Go ahead.

Andrew Sassine

Yes, no, that's correct. Yes, the CROs that we're using are well familiar with and we worked with them before. So we shouldn't anticipate any delays with the changes.

Nick Abbott

Okay. And so if you expect full approval early '23, then we should have data considerably before then considering, you'd have to submit that to the regulators in Vietnam, they would have to review those data.

Andrew Sassine

That's correct. And again, just like the other vaccine manufacturers, this is a process that we want to undergo, which is a rolling submission. So we will have various pieces of the regulatory filings and we'll be doing some day.

Nick Abbott

Okay. And then just last thoughts on for me, you speak to the KOLs because they do when you show them these data, how do they view these data versus the current first-gen vaccines and what one might expect from various specific vaccines?

Joseph Payne

Right, so it's always a fun and interesting academic challenge to compare data with other vaccines. But when we shared this with KOLs, and experts in the field, they do refer to the third shot vaccine data that that other approved vaccines that I've shared where they've shown titers in the 300s and GMFR of 17 after one month, and we've shown a GMFR of 44 after three months.

But there's always nuances to this that people prosecute but the short answer to your question is the KOLs are generally very encouraged by this data no doubt.

Nick Abbott

Okay, great, terrific. Thanks, Joe.

Joseph Payne

Thank you.

Operator

Thank you. Next we'll move on to Seamus Fernandez of Guggenheim Securities.

Unidentified Analyst

Hi guys, this is Evan on for Seamus, I have two on COVID. And then a follow-up on OTC. So wanted to follow-up on the booster trial design. One word, the conversations with regulators and what's left before trial starts for both trials. I believe you mentioned the first trial and starting 4Q. What kind of population will trial enrollment was pulling the adult and elderly? And are there any steps you're taking to accelerate development? And then given that the trials are centered around 154, do you expect the trials and approval to support government sales from U.S. and European governments or would you need to develop a Omicron specific variant and I guess, is there any updates on potential developments there?

Joseph Payne

Yes, both great questions. First of all, we're working closely with the CRO. And that interaction is going to be key with respect to the exact start date, the initial start date for the booster trial. And we have indicated that there's two separate countries but it's at least presently the same CRO. So we're confident there with respect to whether we're going to be focused on just ARCT-154 or building a bivalent strategy is going to be data based, those sorts of decisions. We've touched on it already on the call today. If ARCT-154 stands alone and it's very strong at generating high GMFR's against BA.5 and we have, we're in a fortunate position where we can continue to progress that as a standalone monovalent vaccine against all variants of concern.

If we do see any wavering data against BA.5 or at future variants of BA.10 for example, there may be an appropriate time to bridge in a bivariant strategy. We've been building that consistently throughout this process. We're prepared to move quickly there. And we're working with potential pharmaceutical partners, commercial strategic partners on that.

Unidentified Analyst

Thanks. And one question on OTC, you highlighted in the remarks that you've identified thousands of patients. Can you clarify how many would -- or qualify for the trial? And what's next before dosing begins?

Joseph Payne

Yes, it's well, it's several dozen. I just want to clarify that. So it's many, many. So we've identified a large number of OTC patients in Europe with specific throughput after pre-screening type efforts. So we're in a good, we're in a great position there. So where we are now is in the official screening process and dosing of these patients throughout the second half of this year. And Pad…

Pad Chivukula

And I can just clarify that, we only need a fraction of the patients that we went in for the trial. So we that's all the color we can give.

Joseph Payne

Yes.

Unidentified Analyst

Great, thank you guys.

Joseph Payne

Yes, thank you.

Operator

Thank you. And next we'll move on to Kumar Raja with Brookline Capital Markets.

Kumaraguru Raja

Thanks for taking my questions. So FTF recommended using a bivalent 4, 5 spike protein as a combination. So how soon do you think that is going to come on board? Will you be comparing bivalent in your planned trials?

Joseph Payne

Any bivalence strategy, we haven't disclosed because we've been working behind the scenes with our potential pharmaceutical partners, but we are prepared to proceed immediately if needed. The desire I want to reiterate the plan A is to proceed with ARCT-154 as a standalone monovalent that has exceptional broad spectrum activity because of the self-amplifying mRNA technology. There's something special about it at least that's what we're seeing with BA.1 and BA.2 and we hope that continues with BA.4 and 5.

Kumaraguru Raja

Okay. And with regard to the planned second trial for COVID-19 vaccine. What is the expectation in terms of timing for that?

Joseph Payne

Timing. Well, we said we're collecting the data presently. So we're in the midst of data collection. So once the data set is completed, we'll be able to see that data and operate accordingly after we view it.

Kumaraguru Raja

And with regard to the approval in Vietnam, this manufacturing runs, three manufacturing runs that is being done by Vinbiocare?

Joseph Payne

Yes, it's not. My understanding is that's not a requisite, but that that sure can be the case. We've already completed a portion of those runs already at the facility in Hanoi. I believe it's two of them already. So, but they've requested three, just to establish reproducibility for full approval.

Kumaraguru Raja

Okay, great. Thanks.

Joseph Payne

Yes. Thank you.

Operator

Thank you. Next, we'll move on to Yale Jen with Laidlaw and Company.

Yale Jen

Good afternoon, and thanks for taking the questions. The first question is that, given the Vin the booster study was started in the fourth quarter of this year, and the potential for approval in Vietnam and potentially will be the Vin in 2023. Does the Vietnam full approval need to look at the data from the upcoming boosters study, or they will using some of the studies you already have done as a reference or basis for potential approval?

Joseph Payne

Yes, the combination of both. We've done some booster studies already. And there's additional booster studies that we're planning. So both of these will be taken into consideration for full market authorization in Vietnam in early next year.

Yale Jen

Okay, great. That's helpful. And one more question here is that, as you mentioned about the pharmaceutical company that was supporting subpart of the boosters studies. The question is, have you guys review any details? What this particular company would have? Should the drug get approved? In terms of their benefits or ownership?

Joseph Payne

No. While we haven't provided any details on the pharmaceutical company that's has provided that support. Other than that, we of course we highly respect them.

Yale Jen

Okay, great. Thanks. Appreciate it. And congrats on the progress.

Joseph Payne

Yes, thank you.

Operator

Thank you. And next, we'll move on to Yigal Nochomovitz with Citigroup.

Yigal Nochomovitz

Hi, guys. Thanks a lot for taking the questions. I just want to dig in a little more onto the path to booster approval in the U.S. and Europe. So for these two smaller registrational trials that you've discussed today, can you just clarify what will be the primary vaccine theories? Could it be any of Pfizer Moderna or Novavax? Are you going to restrict it to some of those, or one of those? And then also regarding splitting into the two smaller trials versus the single trial with the 2,400? Was this based on some specific regulatory feedback? Or was this basically an internal decision that you guys took to increase the efficiency? Thank you.

Joseph Payne

Well, this is based on regulatory feedback and senior management, prioritization of efficiency, both time and cost. So it was everything all encompassing, but yes, it did involve specific regulatory feedback for sure. With respect to the comparator vaccine, there's a list of approved vaccines that we can utilize we've identified which comparator vaccine we're using, but we're not disclosing that for comparative purposes.

Yigal Nochomovitz

Okay, but let the way the trial design is working, you're going to give the competitor vaccine to both arms and then the one of the arms will have your booster. The other arm, I assume will have nothing or some other booster is that the right way to conceptualize this?

Joseph Payne

No, we're just trying to do on a larger scale what we've already done on Phase 1, 2 scale. So there's going to be a group that's received an approved vaccine as a primary series either two or three shots. And then we're going to be providing a slot third/fourth shot, which we described as a booster. And then we'll be comparing that to a third or fourth shot of the similar vaccine.

Yigal Nochomovitz

Got you. Okay. And then Andy, is there any reason why you are not able to disclose this pharma company at this point that you -- that's helping you with the booster work? And will we learn the identity of that company at a future point or not?

Andrew Sassine

Well, we hope so. But we have a nondisclosure agreement with them. So unfortunately, we won't be able to do that at that point in time.

Yigal Nochomovitz

Okay, and then one question about your early R&D. There's obviously been a lot of talk about another pathogen, the monkey pox. Are you guys doing any early discovery work on that front?

Joseph Payne

Yes, I think that's a good question for Pad. I want you to address our activities with respect to monkey pox.

Pad Chivukula

Sure. I mean, just like any emerging potential pathogen, I think our preclinical team is always considering. But that's not an actual program currently. But that might change even in future.

Joseph Payne

Yes.

Yigal Nochomovitz

Got it. Okay. Thank you very much.

Pad Chivukula

Thank you.

Joseph Payne

Thank you.

Operator

Thank you. We'll take our last question from Steve Seedhouse with Raymond James.

Joseph Payne

Hey, Steve.

Steven Seedhouse

Hey, hey, thanks for taking the question. Actually, I have a few. The first one respectfully, I think I have to ask this just we noticed a comment in the 10-Q, that the completion of the clinical trials in Vietnam and the review may be delayed substantially because of a recently exposed scandal involving COVID-19 test kits. So you referenced the reorganization of MOH. But obviously, the 10 key language is a bit more dubious. So I was hoping you could clarify that this is just about price gouging and what we can sort of find online or and that there's no impact to data integrity for instance, for our 154 or your ability to leverage those deal outside of Vietnam. And if you have any exposure whatsoever to what's happening within the agency?

Joseph Payne

Yes, thankfully, we haven't had any of that exposure. Yes, this is a -- this reorganization is on affiliated with Acrturus and our vaccine. This is something that's available in the public domain. And I feel free to look into that. But it doesn't have any overlap or exposure relation to Arcturus whatsoever.

Steven Seedhouse

Okay, and then can you just clarify that. Thanks for that comment. Could you just clarify that the remaining data, whether there are any, frankly, for an e-way in Vietnam, it sounds like the CMC issues were for full authorization. Just wanted to see if there's any data pending or if this is just a timing thing, given the MOH personnel issues?

Joseph Payne

I think it's an oversimplification to say it's just a timing thing. But that's how I'm going to address it. It is just a timing thing. Once their reorganization is complete, and we can go through the normal processes, they've already provided feedback on the clinical section in the data. So we feel comfort there. And their feedback on the CMC was more relative to the full market authorization. That's correct.

Steven Seedhouse

Okay. And then lastly, just given 021 is being suspended in the global entity previously mentioned decided not to proceed. Can you just comment on the level of competence that you'll get forgiveness of the $47 million Singapore loan? Or what needs to happen there?

Joseph Payne

Yeah, that's a good question. We're in the process of negotiating that as we speak. And we'll certainly have more detail for you shortly. But you are correct. It is a non-recourse loan. That is clearly and uniquely tied to 021. And so we will update the market with that information as soon as possible.

Steven Seedhouse

Okay, thank you.

Joseph Payne

Great. Thank you, Steve.

Operator

Thank you. And there are no further questions and I turn the conference back over to your presenters for any additional or closing remarks.

Joseph Payne

Well, that's it, everybody. Thank you. We'll stay in touch. Be sure to reach out if you have any further questions and bye for now.

Operator

And that does conclude today's teleconference. We do appreciate your participation. You may now disconnect.

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