Altimmune, Inc. (NASDAQ:ALT) Q1 2024 Earnings Call Transcript

Altimmune, Inc. (NASDAQ:ALT) Q1 2024 Earnings Call Transcript May 9, 2024

Altimmune, Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).

Operator: Good day, ladies and gentlemen and welcome to Altimmune Inc. First Quarter 2024 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce your host for today’s conference, Rich Eisenstadt, Chief Financial Officer of Altimmune. Rich, you may begin.

Rich Eisenstadt: Thank you, Gigi and good morning, everyone. Thank you for participating in Altimmune’s first quarter 2024 financial results and business update conference call. Members of Altimmune team joining me on the call today are Vipin Garg, our Chief Executive Officer; Scott Harris, our Chief Scientific Officer — Scot Roberts, our Chief Scientific Officer; and Scott Harris, our Chief Medical Officer. Following the prepared remarks from Vipin, Scott, Harris and myself, we will hold a question-and-answer session. A press release with our first quarter 2024 financial results was issued this morning and can be found on the Investor Relations section of the company’s website. Before we begin, I’d like to remind everyone that remarks about future expectations, plans and prospects constitute forward-looking statements for purposes of Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995.

Altimmune cautions that these forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated. For a discussion of some of the risks and factors that could affect the company’s future results and operations, please see the risk factors and other cautionary statements contained in the company’s filings with the SEC. I will also direct you to read the forward-looking statement disclaimer in our press release issued this morning and now available on our website. Any statements made on this conference call speak only as of today’s date, Thursday, May 9, 2024 and the company does not undertake any obligation to update any of these forward-looking statements to reflect events or circumstances that occur on or after today’s date.

As a reminder, this conference call is being recorded and will be available for audio replay on Altimmune’s website. With that I will now turn the call over to Dr. Vipin Garg, Chief Executive Officer of Altimmune. Vipin?

Vipin Garg: Thanks, Rich and good morning, everyone. And once again thank you for joining us for our first quarter corporate update. On our last call, I shared our excitement about our accomplishments in 2023 with respect to the advancement of pemvidutide in the obesity and MASH indications that we are currently pursuing We remain optimistic about the potential of our differentiated GLP-1 glucagon dual receptor agonist to continue to the treatment of these two important diseases as we continue to work towards our next milestones in each of these programs. Looking first at obesity. The body composition data from the Phase 2 MOMENTUM trial we reported at the end of March demonstrated that 74.5% of weight loss came from body fat and only 25.5% of weight loss came from the mass in patients taking pemvidutide.

This is comparable to effects associated with diet and exercise based on historical data. This degree of lean mass preservation together with the significant overall weight loss and robust reductions from liver fat and serum lipids observed in each of our prior clinical trials could position pemvidutide as a best-in-class therapy for individuals with obesity and dyslipidemia or excess liver fat. These impressive results will be part of a comprehensive package of clinical and preclinical data that we plan to present to the FDA at our end of Phase 2 meeting which we expect will be held late in the third quarter of 2024. We look forward to this meeting with the — which will help guide the design and conduct of our Phase 3 registrational program for pemvidutide in obesity.

Turning to MASH. We are continuing to enroll patients in the IMPACT study a Phase 2b biopsy-driven trial evaluating two doses of pemvidutide against placebo in approximately 190 subjects. Top line results expected in the first quarter of 2025. Pemvidutide is poised to be the first incretin-based therapeutic candidate to readout on a biopsy-based endpoint in MASH after just 24 weeks of treatment, a reflection of our confidence in the ability of pemvidutide to treat the liver inflammation and fibrosis that characterizes MASH. We believe that these data, if positive would give pemvidutide a meaningful advantage over other incretin-based candidates, candidates being studied in MASH. And further strengthen our competitive position as we enter late-stage development.

As you are all aware, our long-term goal remains to partner pemvidutide and we are firmly committed to finding a partner with the ability to maximize the near and long-term value of the program for Altimmune and our shareholders. And to recognizes the significant potential of our candidates in obesity and MASH as well as other potential indications. In parallel with these ongoing partnering efforts and the continued advancement of pemvidutide for MASH, we are taking additional steps to further leverage the pipeline in a drug potential of pemvidutide. We are not yet in a position to share specific details around additional indications or development plans beyond the two currently being studied but we believe this is a valuable initiative. These efforts are underway and I look forward to providing additional information as our plans take shape.

With that I’ll now turn the call over to our Chief Medical Officer, Dr. Scott Harris to discuss our plans. Scott?

Scott Harris: Thank you, Vipin. As we discussed in March, the MOMENTUM data generated to date are extremely encouraging. Not only did we achieve impressive overall weight loss at 48 weeks but the trajectory of the weight loss suggests that the potential for even greater weight loss with continued treatment. Importantly, the body composition analysis showed a class-leading preservation of lean mass with nearly 75% of the weight loss coming from fat comparable to what is seen following diet and exercise based on historical data. Moreover, the preferential loss of visceral fat over subcutaneous fat that was observed in MOMENTUM may further differentiate pemvidutide as it is well-established that visceral fat that is fat associated with organs like the liver, heart and kidney is linked to a greater risk for cardiovascular disease than subcutaneous fat.

We plan to present the full dataset from the body composition analysis whether as well as other new data from MOMENTUM at key Medical Congresses later this year. Looking at the max MASH program. Enrollment in the Phase IIb IMPACT study continues to progress well, despite a recent FDA approval in this indication, we believe there remains a major unmet need for a drug that not only reduces MASH fibrosis that leads to clinically meaningful weight loss. We believe that weight loss is a critical component in the treatment of NASH, as excess body fat not only drives the path of physiology of MASH but its co-morbidities. We also believe that the weight loss alongside the treatment of the liver condition will be an important consideration for patients and physicians.

We look forward to the top line data readout from this trial, which we continue to expect in the first quarter of 2025. Looking more broadly at the pemvidutide story and the value proposition, Altimmune has long risk recognized and optionality and choice for patients will be important differentiators in the treatment of the metabolic diseases that we are pursuing. To that end we are continuing to make progress towards our previously stated objective of developing an orally administered formulation of pemvidutide. If successful, these efforts can not only provide patients with a choice in how pemvidutide is taken. The local office could support future site lifecycle management should pemvidutide ultimately be approved. We will be presenting an important medical conferences later this year.

And we will be highlighting among other things, the robust and potentially beneficial effects the pemvidutide has on serum lipids including triglycerides, total cholesterol and LDL cholesterol. Recall that we recently reported on a preclinical study demonstrating the pemvidutide treatment, improved cholesterol elimination through an important natural process called reverse cholesterol transport. Those data — and the clinical data that we were reporting — we will be reporting over the next several months, describe changes in lipid metabolism that may ultimately be associated with decreased cardiovascular risk. We believe the type and magnitude of these lipid effects are best explained by the action of glucagon receptor agonism in pemvidutide.

With that, I will now turn the call over to our Chief Financial Officer, Rich Eisenstadt, to review our financial results for the first quarter. Rich?

Rich Eisenstadt: Thank you, Scott, and good morning again, everyone. For today’s call, I will be providing a brief update on Altimmune’s first quarter 2024 financial and operating results. More comprehensive information will be available in our Form 10-Q to be filed with the SEC later today. Altimmune ended the first quarter of 2024 with approximately $182.1 million of cash, cash equivalents and short-term investments compared to $198 million at the end of 2023. We project that our existing cash funds us into the first half of 2026, which fully funds our IMPACT trial and MASH. Turning to the income statement. Revenue was negligible in the first quarter of 2024 and 2023, any revenue reported during such periods was for indirect rate adjustments on a government contract that we are closing out.

Research and development expenses were $21.5 million in the first quarter of 2024 compared to $17.2 million in the same period in 2023. Approximately $14.5 million of this total for the first quarter of 2024, where direct expenses for the conduct of our clinical programs including $13.5 million in direct costs related to development activities for pemvidutide and $1 million in direct costs related to wind down and closing of HepTcell as announced on March 27, 2024. R&D expenses in the first quarter of 2023 included $8.9 million in direct expenses associated with the development of pemvidutide and $2.1 million in direct expenses related to HepTcell development activities. General and administrative expenses were $5.3 million in the first quarter of 2024 versus $4.5 million in the first quarter of 2023, the $800,000 increase is due primarily to an increase in stock compensation and other labor-related expenses.

Our quarterly noncash operating expenses for the first quarter 2024 was $3.8 million, all of which are recurring expenses. Net loss for the three months ended March 31, 2024, was $24.4 million or $0.34 net loss per share compared to a net loss of $20.1 million or $0.40 net loss per share for the first quarter of 2023. The increase in net loss in the quarter is primarily attributable to the $4.2 million higher research and development expenses as we ramp up the IMPACT Phase IIb trial and MASH. I will now turn it back over to Vipin for his closing remarks. Vipin?

Vipin Garg: Thank you, Rich. We remain excited for what the future holds. It’s several important milestones in the coming months. We believe that Altimmune is well positioned for long-term value creation as we continue advancing the development of pemvidutide. Operator, that concludes our formal remarks and we would like to open the line to take questions.

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Q&A Session

Operator: Thank you. [Operator Instructions] Our first question comes from the line of Roger Song from Jefferies.

Q – Roger Song: Great. Thanks for the update and taking our questions. A couple from us. The first one is related to your upcoming end-of-Phase 2 meeting with the FDA for your obesity program. Given pemvidutide has a pleiotropic effect in many different ways to differentiate. Just curious how — what kind of endpoints you will plan to incorporate into your program to really capitalize those differentiations in the potential label? And then I have a follow-up question related to your new development.

Vipin Garg: Scott, do you want to take that?

Scott Harris: Yes, Roger. We’re greatly looking forward to the end-of-Phase 2 meeting. We think it’s going to be greatly value enhancing to really set forward our program and to really maximize the value proposition. And I think you’ve hit the nail on the head with what the objective of the meeting will be. I mean, just as an oversight, we expect the program to have about 5,000 patients. We’re make — we’re taking a good look as to whether we want to conduct, say, three or four pivotal trials across those 5,000 patients. But I think the key thing will be to choose the best population that will most meaningfully bring out the effects of pemvidutide, the effects on the lipids, the effects on the body composition, the effects on the liver fat.

So that — a lot of the discussion will center around choosing the population for the studies. I think some other important points here will be selecting the optimal treatment duration. We got great results at 48 weeks, but is there a potential for getting even better results in weight loss and even better body composition at a longer time point? That’s the decision we’re really looking forward to making with the FDA. As you know, we had 25% loss of lean mass, 75% loss of fat mass at 48 weeks. But that ratio of lean to fat goes down over time. So if followed out over a longer period of time, that ratio should drop even further and put pemvidutide at the top of its class in terms of its preservation of lean mass. So, the number of trials, the selection of the population to maximize the value proposition, particularly the lipids, liver fat, the body composition, and the duration of treatment are all things that we aim to get agreement with the agency when we meet with them.

Roger Song: Got it. Maybe quickly on your potential new development on two ends. One is the new indication for pemvidutide. Just curious, I understand you’re not disclosed yet, but just curious in that kind of a comorbidity with obesity, MASH, or something pretty orthogonal to the current obesity and MASH population. And in terms of your oral pemvidutide development, just curious what will be the formulation? And how do you think about the scalability for your oral peptide?

Scott Harris: I’ll answer the question about the emerging development program, and I’ll then turn it over to Scot Roberts to specifically answer the question about the oral formulation. So, as you know, companies are pursuing new indications surrounding obesity in order to maximize their value proposition. With regards to Altimmune, we are specifically, as you pointed out, looking for indications that reflect the value proposition of glucagon, which is very differentiating. So the effects of glucagon on serum lipids, for example, the effects on body composition, and also diseases of the liver that are associated with fatty liver or even obesity. So we believe that the indications will reflect specifically what glucagon brings to the table, and we’re very hopeful to make a decision about new programs in the near future. Now I’m going to turn it over to Scot Roberts to answer the question about the oral formulation. Scot?

Scott Harris: So, as we’ve indicated in the past, we’re pursuing a number of different approaches, different types of formulations, different matrices to obtain an oral formulation for pemvidutide. Those studies are ongoing. The work is incremental. You find a formulation that has some merit and is looking good, and it’s optimized and then retest. And so, it’s a really good process and we’re in the middle of that with a number of different approaches. We are expecting and hoping to still nominate a candidate for development by the end of the year. As far as the scalability question, one of the criteria that we are set for successful oral formulation is a specific level of bioavailability to ensure that the amount of drug substance required for that would be appropriate and attainable and useful. So the scalability, if we have a successful formulation will not be an issue and we’re continuing to make progress on all fronts.

Roger Song: Great. Thank you. That’s it for me.

Operator: Thank you. One moment our next question. Our next question comes from the line of Yasmeen Rahimi from Piper Sandler.

Q –Unidentified Analyst: Hey team. Good morning. This is Chang Yuan [ph] for Yas. Thanks for taking the questions. First, could you comment in regards to finding the right partner? Is this company — NASH impact results? And secondly, with upcoming EASL conference, what do you hope to gain from competitor presentations to shed light into your own program and increased the probability of success?

Vipin Garg: Scott, do you want to take the second question first?

Scott Harris: Yes. So, I think if I heard correctly and I apologize if I did not. You’re asking about the upcoming liver meetings in Europe, the EASL meetings, is that correct?

Q –Unidentified Analyst: Yes, that’s correct.

Scott Harris: Let me start by saying that we have a variety of presentations that are planned for meetings across the entire year. So we will not be representative of the EASL. We have three presentations at EASL. Those have been posted on the EASL website. Those will address specific aspects of the pemvidutide in MASH and its metabolism and its effects on metabolism. And we think that that will continue to be differentiating but the impacts on the science, the impact on the differentiation the value proposition, the body composition data, the effects on lipids, the effects on other aspects of lipids that have not really gotten as much attention. These things will all come out at key scientific congresses over the course of the year.

Vipin Garg: And you want to comment on what we expect to learn from other presentations?

Scott Harris: Well, there are — will be some presentations on other compounds. For example, we anticipate that the semaglutide data will be presented at EASL and also be some presentations on tirzepatide. As you know, they’ve had top line readouts on their results at least in press releases. We’re looking forward to that. As you know the tirzepatide data did not hit the fibrosis endpoint, which is something we would have expected by a mechanism that doesn’t have glucagon and semaglutide does have glucagon and they’ve announced that they’ve reached — they achieved statistical significance on the fibrosis endpoint and we look forward to hearing that. But we would emphasize that that’s due to the presence of glucagon in the molecule and we have a much greater amount of glucagon. So we feel that any success that they build, we can beat in our readout. That’s coming up in the first quarter of next year.

Vipin Garg: In terms of your question about the right kind of partner, we’ve always maintained that the compound that we are developing semaglutide had very compelling data both in obesity as well as in MASH. And if you think about it MASH and obesity really intersect each other. It’s going to be hard to differentiate in these patient populations down the line, because most people with MASH also need to lose weight. So we think we bring a perfect combination of these two things. Our focus has been — in terms of the right partner, has been on partners that value both of these indications and our goal is to find a partner that will help us develop both of these indications in parallel.

Q –Unidentified Analyst: All right. Thank you so much.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Corinne Jenkins from Goldman Sachs.

Q –Unidentified Analyst: Good morning. This is Mario [ph] on for Corinne. So, a couple of questions for us. Could you provide an update on how the partnership discussions are progressing and do you plan to bring in a partner for the new indication you want to pursue with pivotal data?

Vipin Garg: Thanks for the question. In terms of the partnership discussions that continues to be a topic of interest. What I can say is that our partnering efforts are ongoing. We have the numerous factors that come into play in finalizing a partnership discussion. So stay tuned. Those efforts are ongoing and we expect to have a partner before we go into Phase III development for obesity. As we mentioned earlier in the call, we are getting ready for the end of Phase II meeting. We think that’s going to be very value-driving having that information, as well as additional data. In terms of the additional indications, yeah, I mean these indications really are an extension of obesity and match for some of the broader indication in obesity and mass, and we’re trying to figure out where does our compound has the maximum value creation opportunity, differentiation opportunity relative to other compounds that are mainly GLP-1 focused.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Alana Lelo from Guggenheim.

Alana Lelo: Hi there. Thanks for the question. I just wanted to circle back a little bit on the potential outcome of the synergy NASH study and back to the partnerships again. So with facility NASH, from my understanding, it was said that they had a clinically meaningful benefit on fibrosis, but there was no direct commentary on whether that was statistically significant or not. If it turns out that tirzepatide does lead to statistically significant fibrosis benefit. How do you see that impacting the prospects of NASH?

Scott Harris: Well, thanks for the question Alana. So as we’ve continued to state these drugs do not have the same liver defining effect or effects on fibrosis improvement that the compound rich and glucagon has. So it is possible that they could have meaningful results potentially statistically significant. These drugs will eventually have a direct effect on fibrosis if you have enough patients and you follow them out long enough. And we know that from bariatric surgery were that simply a reduction of caloric intake. So eventually they would hit an endpoint given enough patients and enough time. But I think you’ve seen from our original data that the speed and the robustness of the effects are tremendously enhanced in the presence of glucagons, such that we can get a better treatment effect.

And actually we did that in an earlier time point. So we would congratulate them if they achieved statistical significance. But we would also highlight the fact that we believe that we will do better.

Alana Lelo: Great. Thank you for that clarification. And then just very quickly on the partnerships. With respect to timing, are you still confident that a partner can be secured this year? Are you thinking that it might be more likely after the NASH data hit 1Q 2025?

Vipin Garg: Yeah. Thanks for the question Alana. Look it is difficult to pinpoint the time line for partnering. As I’ve said our efforts are ongoing. We would love to have our goal remains to have a partner before the end of the year, before we start the obesity Phase III program. But let’s see how things develop on that front as our discussions progress we’ll know better. But at this point, we are committed to having a partner on board before the start of Phase III in obesity.

Alana Lelo: Great. Thanks so much for taking my question.

Vipin Garg: Welcome.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Mayank Mamtani from B. Riley Securities.

Mayank Mamtani: Good morning, team. Thanks for taking my questions; and good to see the end of Phase II meeting being calendared. So maybe just on that quickly, are you able to share how your specific plans could vary relative to say a step in SURMOUNT program. I believe Amgen may also be having similar FDA correspondence around same times. So, I wonder if any guidance from an FDA standpoint on this next wave of weight-loss drugs could be relevant here. And also if you are able to can’t comment on the outcome trial commitment how big that could be given obviously you have a big lipid benefit and then I have a couple of follow-ups.

Scott Harris: Well, thanks for the question. Mayank. I’m not sure I heard the entirety of the first question, so please persist if I don’t answer it completely. So look, this meeting that we’re going to have come later this year is going to be extremely value enhancing for the Company. And there are a lot of great things that we can get done at this meeting that really enhance our goals and objectives specifically around glucagon and what glucagon brings to the table in the treatment of obesity. So we’re expecting that there will be certain things in place that our expected safety database of 5,000 subjects in probably distributing those subjects across three to four trials. We’re going into the meeting with that expectation and more than likely that will be a trial without diabetics and with diabetics.

But there’s still room for creating trials with endpoints and populations that enhance the value proposition of penveu tied in the role of glucagon in the treatment of obesity and provide differentiation as the obesity market becomes more substance becomes more segmented. So, as we know the obesity population right now is not well differentiated. Right now, there’s not great certainty about what those segments will look like. We know that it will become more segmented the same way hypertension became differentiated over time. So our goal is to ride that wave and to find ways that we can really stress differentiation based on the mechanism. And as I pointed out before, that could include choosing the best population for example to enrich in the liver that lipid effects, looking at body composition changes over time, looking at different durations of treatment in order to maximize the amount of weight loss because since as you know the weight loss was steeply continuing at 48 weeks and trial and the improvement of body composition.

Now, with respect to the body composition, we know the loss of lean mass is associated with loss of function and also a higher rate of bone fractures, particularly in the elderly and also in women. So we saw the semaglutide trial. They had a 40% loss of lean mass which exceeds the natural weight loss, the natural loss of lean mass from diet and exercise which is about 25% which is what we achieved. But with that 40% lean loss in their label, they report a higher rate of fractures in women and the elderly. So now you can see the immediate implications on the market and the differentiation on the segments. For example because of its preservation of lean mass could tend to do tie be ideally suited for treating the elderly, especially frail or individuals or women with osteoporosis risk which is a huge segment of the population recognizing that women with lean bone mass are carrying around extra weight which increases the risk of fractures.

So all in all, these are discussions that we’ll have with the FDA’s which is our target population and our endpoints.

Mayank Mamtani: Super helpful. I think you covered a lot if you could comment on the outcome trial scale and scope given you have a big lipid benefit?

Scott Harris: Right. Obviously that’s going to be a great benefit to us. I think that’s where we can really differentiate because as you’re aware in the SELECT trial there was a 20% reduction of MACE major adverse cardiac events just in the basis of weight loss alone and their effects on serum lipids are minimal at best. I believe there if I’m quoting the data correctly, the reduction of LDL cholesterol and total cholesterol only in the range of about 3% to 5%. Recognize that in our population of subjects with elevated serum lipids at baseline, we saw a 21% reduction of LDL which is comparable to the effects of statins, so going into that trial. We can have really very excellent effects that exceed that seen with them with semaglutide.

We also have reported out data on lipidomics in the past showing that not only this penveu tied reduce the amount of LDL and total cholesterol, it also changes the very nature of the lipids that are circulating, inflammatory lipids. That are known to damage the cardiovascular system and liver, like ceramides and diacylglycerols. So we’re very optimistic about conducting that trial. Optimistically, that is a trial that we’d like to start with in Phase 3 and get those results as soon as possible, so that we have it around the time of market authorization and that would be something that we’d hope to achieve in the discussion with the FDA.

Mayank Mamtani: Got it. And then just on the MASH development, you have fast track. There’s another glucagon-directed program, which has now Phase 3 based on NIT endpoints, weight loss, and MRI-PDFF, no biopsy. I was just curious if you could also get some preliminary guidance on what your late-stage MASH development could look like. And maybe just remind us on the enrollment for impact. Are you on track to complete enrollment in 3Q? Thanks again for taking our question.

Scott Harris: Yeah. Thanks for the question, Mayank. The obesity meeting is going to be with the endocrine division. Our NASH program is going to be with the liver division. So I don’t really think there’s going to be immediate opportunity to get information about the NASH development. Of course, there’s overlap and interchange of ideas, and clearly any information we get from obesity we can take forward to enhance NASH development. Regarding enrollment, it’s going extremely well. We this reflects the fact that patients with NASH are seeking treatments that have visible, clear effects on them that they can see. MASH is a silent disease. And what they see on a day-to-day basis is their body weight. So given the opportunity to lose weight in the trial, they’re coming into the trial at very handsome rates. And this robust rate of enrollment is going to support, as we’ve said, the readout in the first quarter of next year.

Mayank Mamtani: Got it. Thank you.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Jon Wolleben from Citizens JMP.

Jon Wolleben: Yeah. Thanks for taking the question. We had some data last night from another GLP glucagon agonist. I was wondering if you guys saw. Because we’ve heard some critiques that glucagon agonist may not be effective and even detrimental for diabetics. But this data said that Chinese patients showed superiority to dulaglutide. And I was wondering, your thoughts on that data set? And do you see any read-through to pemvidutide and others in the class? And how are you thinking about the diabetic population as an opportunity for pemvidutide?

Scott Harris: Well, thanks, Jonathan. So, just to emphasize, we’ve seen excellent control of blood glucose in our program. And this drug is not designed specifically based on its ratio of GLP-1/glucagon to drive down blood sugar or hemoglobin A1c. But it clearly maintains it safely while patients derive a whole variety of other benefits. So we continue to believe that the data that you’ve talked about, as well as our own data, supports the safety and effectiveness of the drug in all populations, including diabetics. I would emphasize that we are seeing in our studies weight loss in diabetics equivalent to the weight loss in non-diabetics. This is something that’s of great interest to us as we go forward into Phase 3, because it is possible that there is something unique about a glucagon mechanism where the weight loss is preserved in diabetics, which would be extremely attractive, because, as you know, diabetics with the GLP-1 based compounds, like semaglutide and tirzepatide, seem to take a haircut in the diabetic population.

So we are extremely interested in pursuing that and believe that we could operate very nicely in the diabetes space.

Jon Wolleben: Okay. And then one more, if I may. Just — as you guys are planning for your Phase 3 program, can you talk about the trade-off between the shorter titration, which you guys have talked a lot about in the past, versus, improving the tolerability profile with the slower titration, like we’ve seen from other programs, and how you think about the importance of both and your thoughts going into the Phase 3?

Scott Harris: Well, thanks. Great question, Jonathan and something that we’re giving a lot of thought to. The first thing I would say is that 1.2 dose of pemvidutide is extremely attractive. It has an adverse event profile, an adverse event discontinuation rate similar to placebo, and want to remind everybody is given without dose titration. So we’re going to pursue that dose as well as the 1.8 milligram, 2.4 milligram doses going into Phase 3. But literally a physician could prescribe a dose of pemvidutide that’s approved not have to titrate up to it and some patients were achieving 20% weight loss on that. And the natural use of the drugs in clinical practice is that these drugs are started on the lowest dose. The doctors wait see how the patients do and then increase to other doses like 1.8 milligrams and 2.4 milligrams as they go forward.

So in practice the scheme that you’re talking about of titration is really only a construct of clinical trials. In practice that doctors naturally titrate by starting on a low dose waiting, observing and then going to the next dose and the next dose. Now with regards to the construct in clinical trials, we’re very happy with the tolerability profile of pemvidutide as we’ve currently developed. We know that the allowance of dose reduction which happens all the time in clinical practice, but specifically allowed and all of the other obesity trials will greatly enhance the tolerability profile of the compound. We’re seeing single digit adverse event discontinuation rates in our MASH – in our D trials and our diabetes trials. We saw no adverse events discontinuations at all.

And — 1.8 milligram dose there was no nausea reported. So that aside from the obesity population, this drug is very well-tolerated. That being the case there is the optionality to pursue longer dose titration in a Phase 3 program. It’s something that we’ve considered it something on the table as we go forward into discussions with the FDA.

Jon Wolleban: Very helpful color, Scott. Looking forward to seeing those details when you announce them.

Scott Harris: Thanks Jonathan.

Operator: Thank you. At this time, I am showing no further questions. I would now like to turn the conference back over to Vipin Garg for closing remarks.

Vipin Garg: Thank you. Thank you everyone for participating today. We appreciate this opportunity to share our results and outlook with you and thank you for your continued support and have a wonderful day.

Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.