Viking Therapeutics, Inc. (NASDAQ:VKTX) Q2 2024 Earnings Call Transcript

Viking Therapeutics, Inc. (NASDAQ:VKTX) Q2 2024 Earnings Call Transcript July 24, 2024

Viking Therapeutics, Inc. beats earnings expectations. Reported EPS is $-0.20156, expectations were $-0.26.

Operator: Welcome to the Viking Therapeutics Second Quarter 2024 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following management’s prepared remarks, we will hold a Q&A session. [Operator Instructions] As a reminder, this conference call is being recorded today, July 24, 2024. I would now like to turn the conference over to Viking’s Manager of Investor Relations, Stephanie Diaz. Please go ahead, Stephanie.

Stephanie Diaz: Hello, and thank you all for participating in today’s call. Joining me today is Brian Lian, Viking’s President and CEO, and Greg Zante, Viking’s CFO. Before we begin, I’d like to caution that comments made during this conference call today, July 24, 2024, will contain forward-looking statements under the Safe Harbor provisions of the U.S. Securities Litigation Reform Act of 1995, including statements about Viking’s expectations regarding its development activities, timelines, and milestones. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially and adversely, and reported results should not be considered as an indication of future performance. These forward-looking statements speak only as of today’s date, and the company undertakes no obligation to revise or update any statement made today.

I encourage you to review all of the company’s filings with the Securities and Exchange Commission concerning these and other matters. I’ll now turn the call over to Brian Lian for his initial comment.

Brian Lian: Thanks, Stephanie, and good afternoon to everyone listening in by phone, or on the webcast. Today we’ll review our financial results for the second quarter and six months ended June 30, 2024, and provide an update on recent progress with our clinical programs and operations. The first half of 2024 has been an exciting time at Viking. During the first quarter, we announced positive results from the Phase 2 VENTURE trial evaluating VK2735 for the treatment of obesity. This trial demonstrated impressive reductions in body weight after 13 weeks of treatment. We also announced the initial results from a Phase 1 trial evaluating a novel oral formulation of VK2735 in healthy volunteers, which showed encouraging reductions in body weight and excellent tolerability after 28 days of dosing.

The positive momentum from these readouts, continued into the second quarter with the announcement of the 52-week histology results, from our Phase 2b VOYAGE trial evaluating VK2809 for the treatment of NASH and fibrosis. This study successfully achieved secondary and exploratory endpoints of improvement in NASH resolution rate, fibrosis, and the combination of both. I’ll summarize the highlights from these studies later in the call. During the second quarter, Viking also announced early results from a series of internally developed dual agonists of the amylin and calcitonin receptors at the 84th Scientific Sessions of the American Diabetes Association. These compounds demonstrated body weight reductions, decreased food intake, and improved metabolic profile in animal models.

Finally, we ended the second quarter with a strong balance sheet with over $900 million in cash, providing the resources to aggressively advance each of our pipeline programs. I’ll provide further details on our operations and development activities, after we review our financial results for the second quarter and six months ending June 30. For that, I’ll turn the call over to Greg Zante, Viking’s Chief Financial Officer.

Greg Zante: Thanks, Brian. In conjunction with my comments, I’d like to recommend that participants refer to Viking’s Form 10-Q filing with the Securities and Exchange Commission, which we expect to file later today. I’ll now go over our results for the second quarter and six months ended June 30, 2024, beginning with results for the quarter. Research and development expenses were $23.8 million for the three months ended June 30, 2024, compared to $13.9 million for the same period in 2023. The increase was primarily due to increased expenses related to manufacturing for the company’s drug candidates, clinical studies, preclinical studies, salaries and benefits, and stock-based compensation. General and administrative expenses were $10.3 million for the three months ended June 30, 2024, compared to $9.8 million for the same period in 2023.

The increase was primarily due to increased expenses related to stock-based compensation and services provided by third-party consultants, partially offset by a decrease in expenses related to legal and patent services. For the three months ended June 30, 2024, Viking reported a net loss of $22.3 million, or $0.20 per share, compared to a net loss of $19.2 million, or $0.19 per share, in the corresponding period in 2023. The increase in net loss for the three months ended June 30, 2024, was primarily due to the increase in research and development expenses and general and administrative expenses noted previously, partially offset by increased interest income compared to the same period in 2023. I’ll now go over the results for the six months ended June 30, 2024.

Our research and development expenses for the six months ended June 30, 2024, were $47.9 million, compared to $24.9 million for the same period in 2023. The increase was primarily due to increased expenses related to manufacturing for our drug candidates, clinical studies, preclinical studies, stock-based compensation, salaries and benefits, services provided by third-party consultants, and regulatory services. Our general and administrative expenses for the six months ended June 30, 2024, were $20.3 million, compared to $19.4 million for the same period in 2023. The increase was primarily due to increased expenses related to stock-based compensation, salaries and benefits, and services provided by third-party consultants, partially offset by a decrease in expenses related to legal and patent services.

For the six months ended June 30, 2024, Viking reported a net loss of $49.6 million, or $0.46 per share, compared to a net loss of $38.8 million, or $0.44 per share, in the corresponding period in 2023. The increase in net loss for the six months ended June 30, 2024, was primarily due to the increase in research and development expenses and general and administrative expenses noted previously, partially offset by increased interest income compared to the same period in 2023. Turning to the balance sheet, at June 30, 2024, Viking held cash, cash equivalents, and short-term investments of $942 million, compared to $362 million as of December 31, 2023. This concludes my financial review, and I’ll now turn the call back over to Brian.

Brian Lian: Thanks, Greg. As I mentioned in my opening remarks, the first half of 2024 has been an exciting period for the Viking team. In recent months, the company has announced positive results from three clinical programs, with each readout demonstrating what we believe to be best-in-class results. Further, the company recently announced preclinical data from a new internal program that we expect to become an important addition to the company’s pipeline. I’ll first review the status of our lead obesity program, VK2735. This compound is a dual agonist of the glucagon-like peptide 1, or GLP-1 receptor, and the glucose-dependent insulinotropic polypeptide, or GIP, receptor. A Phase 1 single and multiple ascending dose study of VK2735, demonstrated the promising safety, tolerability, and pharmacokinetics of VK2735 when administered as a weekly subcutaneous injection for up to four weeks.

In addition, subjects in the study demonstrated up to approximately 8% weight loss from baseline after 28 days, with no signs of plateau. Last fall, we initiated a Phase 2 study of VK2735, known as the VENTURE trial. This trial was a randomized, double-blind, placebo-controlled, multi-center study that evaluated the safety, tolerability, pharmacokinetics, and weight loss efficacy of VK2735 administered subcutaneously once weekly for 13 weeks. In the first quarter, Viking announced positive top-line results from the VENTURE study, which successfully achieved its primary endpoint and all secondary endpoints, with patients receiving VK2735, demonstrating reductions in body weight at all doses compared with placebo. On the primary endpoint, patients receiving VK2735 demonstrated statistically significant reductions in mean body weight from baseline, ranging up to 14.7%, as well as statistically significant reductions in body weight relative to placebo, ranging up to 13.1%.

Statistically significant differences compared to placebo were observed for all VK2735 doses, starting at week 1 and were maintained throughout the course of the study. Weight loss in all treated cohorts was progressive through 13 weeks, and did not show evidence of plateauing. We believe this suggests that further weight loss could be achieved through extended dosing beyond the 13-week treatment period of this study. The VENTURE study also showed VK2735 treatment to be safe and well-tolerated over the 13-week trial, with the majority of treatment-emergent adverse events being characterized as mild or moderate, and primarily related to expected GI effects resulting from activation of the GLP-1 axis. Following completion of dosing in the VENTURE study, patients returned to their respective clinical sites at various time points for follow-up assessments, including pharmacokinetic measurements.

We believe the resulting PK data merit the development of less frequent dosing regimens. To this end, we expect to explore monthly dosing of VK2735 in a future study. We believe the flexibility afforded, by offering both a weekly and a monthly regimen should provide an attractive option, for patients who wish to tailor dosing to their individual lifestyle and preference. Details on trial design will be provided, as we get closer to trial initiation. In the second quarter, following completion of the VENTURE study, we requested and were granted a Type C meeting with the FDA, to help us plan for next steps in the development of VK2735. Based on written feedback from the agency, we intend to advance VK2735 into Phase 3 development for obesity.

As a next step, we plan to schedule an end-of-Phase 2 meeting with the agency, to review development plans, and we currently expect this meeting to take place in the fourth quarter of this year. In parallel with the development of a subcutaneous formulation of VK2735, we are also developing an oral tablet formulation of this compound. We believe a tablet formulation could represent an attractive treatment option for patients who are hesitant to initiate injection-based therapy, or for those seeking to maintain the weight loss they have already achieved. A key advantage in this regard is the potential to transition patients from the subcutaneous formulation, to an oral formulation which utilizes the same molecule. We believe this may reduce the risk of unexpected safety or tolerability challenges and could be an attractive option for both patients and clinicians.

Last year, Viking initiated the Phase 1 study to evaluate the tablet formulation of VK2735. This study was a randomized, double-blind, placebo-controlled study in healthy adults with a minimum body mass index of 30 kilograms per meter squared. The primary objective was to evaluate the safety and tolerability of VK2735 administered as a tablet once daily for 28 days. Secondary and exploratory objectives included an evaluation of the pharmacokinetics, of orally administered VK2735 as well as various pharmacodynamic measures, including changes in body weight and other metrics. In the first quarter of this year, we reported the initial data from this study. With respect to safety and tolerability, oral VK2735 was shown to be safe and well-tolerated following once-daily dosing for up to 28 days at doses that were titrated up to 40 milligrams.

Among subjects receiving VK2735, all treatment emergent adverse events were reported as mild, or moderate in severity with the majority reported as mild. No clinically meaningful differences were reported for gastrointestinal adverse events, among subjects treated with VK2735 compared with placebo. In addition to safety and tolerability, an exploratory assessment of change in body weight was conducted. Subjects receiving oral VK2735 demonstrated dose-dependent reductions in body weight ranging up to 5.3% from baseline. Placebo-adjusted reductions in body weight reached up to 3.3% from baseline. Weight loss over the 28-day window of this study, was progressive at the 20 and 40 milligram dose levels with no plateau observed. Based on the promising weight loss signal observed in this study, along with the excellent tolerability profile at doses up to 40 milligrams per day, further dose escalation was pursued.

In the second quarter, we filed an IND with the FDA, to allow the addition of U.S.-based enrollment in order to facilitate an improved rate of study progression. Following clearance of the IND, we continued dose escalation and have since completed dosing in cohorts, at both 60 milligram daily and at 80 milligrams daily. A 100 milligram daily dosing cohort is currently ongoing. We recently submitted an abstract describing this study for presentation this fall at Obesity Week. We believe the data generated from this study support evaluation of oral VK2735 in a larger, longer Phase 2 trial in patients with obesity. To this end, we plan to initiate a 13-week study in the fourth quarter of this year. Moving to our third clinical program, VK2809, for the treatment of MASH or NASH, in the second quarter, we announced positive histology results from the 52-week VOYAGE study of VK2809 in patients with NASH and fibrosis.

As a reminder, VK2809 is an orally available small molecule agonist of the thyroid hormone receptor that, is selective for liver tissue as well as the beta isoform of the receptor. The Phase 2b VOYAGE study was a randomized, double-blind, placebo-controlled, multi-center international trial designed to assess the efficacy, safety, and tolerability of VK2809 in patients with biopsy-confirmed NASH and fibrosis. Enrollment included patients with at least 8% liver fat content as measured by magnetic resonance imaging proton density fat fraction, as well as F2 and F3 fibrosis. The initial data from the VOYAGE study reported last year, demonstrated that the study had successfully achieved its primary endpoint, with patients receiving VK2809 demonstrating statistically significant reductions in liver fat content, from baseline to week-12 as compared with placebo.

The median relative change from baseline in liver fat, among patients treated with VK2809 ranged from 38% to 55% after 12 weeks. In addition, up to 85% of patients receiving VK2809 experienced at least a 30% relative reduction in liver fat. Efficacy on liver fat was independent of either fibrosis status, or the presence of type 2 diabetes. Reduction of liver fat is associated with a greater likelihood of histologic benefit in NASH, suggesting that VK2809 held the potential to provide benefits on histology endpoints assessing NASH resolution and fibrosis improvement. Last month, Viking announced additional results from the VOYAGE study demonstrating the successful achievement, of the trial’s secondary endpoints evaluating histologic changes assessed by hepatic biopsy after 52 weeks of treatment.

The histology results showed that patients receiving VK2809 experienced clinically and statistically significant improvements in NASH resolution rate, fibrosis stage, and the combination endpoint of NASH resolution and fibrosis improvement. On the endpoint of NASH resolution without worsening fibrosis, VK2809 treated patients’ demonstrated resolution rates, ranging from 63% to 75% compared with 29% for placebo. On the secondary endpoint evaluating proportion of patients, demonstrating at least a one-stage improvement in fibrosis with no worsening of NASH, the proportion of VK2809 treated patients demonstrating improvements in fibrosis ranged from 44% to 57%, compared with 34% for placebo. On the secondary endpoint evaluating the proportion of patients experiencing, both the resolution of NASH and at least a one-stage improvement in fibrosis, the proportion of VK2809 treated patients achieving both measures ranged from 40% to 50%, compared with 20% for placebo.

Turning to safety and tolerability, VK2809 demonstrated an encouraging profile through 52 weeks of treatment with minimal differences compared with the previously reported results from 12 weeks. The majority, 94%, of treatment-related adverse events among patients receiving VK2809 were reported as mild or moderate. Discontinuations due to adverse events, were low and balanced among placebo and treatment arms. VK2809 also demonstrated excellent gastrointestinal tolerability through 52 weeks of treatment with similar rates of nausea, diarrhea, stool frequency, and vomiting among VK2809 treated patients as compared to placebo. We believe these data clearly demonstrate VK2809’s best-in-class efficacy on both NASH resolution and fibrosis improvement, along with the potential for cardiovascular benefit through improvement in plasma lipids.

We are currently preparing for an end-of-Phase 2 meeting with the FDA to discuss the registration path for VK2809 in NASH, and we expect this meeting to occur in the fourth quarter of this year. I’ll now move to our fourth clinical program, VK0214, for the treatment of the rare neuromuscular disorder called X-linked adrenoleukodystrophy, or X-ALD. VK0214 is our second thyroid hormone receptor beta agonist in clinical development. Like VK2809, VK0214 is also an orally available small molecule that is selected for the beta isoform of the thyroid hormone receptor. X-ALD is a rare and debilitating metabolic disorder that, is caused by genetic mutations that disable the function of a peroxisomal transporter of very long-chain fatty acids. As a result, patients are unable to efficiently metabolize these acids, and the accumulation of these compounds is believed to contribute to the onset and progression of X-ALD.

VK0214 is being evaluated in a Phase 1b study enrolling patients with the Adrenomyeloneuropathy, or AMN, form of X-ALD, which is the most common form of the disorder. This trial is a randomized, double-blind, placebo-controlled, multi-center study in adult male patients with AMN. The primary objectives of the study are to evaluate the safety, tolerability, and pharmacokinetics of VK0214 administered orally, once daily, for 28 days. The study also includes an exploratory assessment of changes in plasma levels of very long-chain fatty acids. We recently completed enrollment in this study and expect to announce the top-line results later this year. I will now briefly summarize our newest program targeting the amylin receptor for the treatment of obesity.

During the second quarter, Viking presented preclinical data at the American Diabetes Association’s scientific sessions from an internally developed dual amylin and calcitonin receptor agonist program. As the amylin receptor plays an important role in food intake and metabolic control, we believe it may represent an important target for therapeutic intervention in obesity and an attractive opportunity to expand the company’s pipeline in this area. The company’s ADA presentation highlighted the effects of treatment on body weight, food intake, and metabolic profile in healthy rats and in diet-induced obese mice. The study results demonstrated that Viking’s series of dual amylin and calcitonin receptor agonists reduced food intake in lean rats in the period from zero to 72 hours following a single dose.

At 72 hours post-dose, Viking’s compounds resulted in up to 8% body weight reductions, compared to vehicle-treated animals. In a diet-induced obese mouse model, treatment with Viking’s amylin agonists for 24 days resulted in up to 10% weight loss from baseline. We believe this mechanism represents an interesting approach to reducing body weight, both as a single agent or in conjunction with other mechanisms. We plan to move our amylin program into clinical development in 2025. In conclusion, the first half of 2024 was a period of intense activity at the company highlighted by the announcements of successful results from three different clinical trials, as well as the introduction of a new pipeline program targeting obesity. The VENTURE Phase 2 study of VK2735 demonstrated up to an approximately 15% reduction in body weight from baseline following 13 weeks of dosing by weekly subcutaneous injection, as well as promising safety and tolerability.

We’re currently planning for an end-of-Phase 2 meeting with the FDA and plan to initiate Phase 3 development upon completion of that dialogue. The Phase 1 study of the oral tablet formulation of VK2735 demonstrated excellent safety and tolerability and positive signs of clinical activity. We expect to initiate a Phase 2 trial for this program later this year. And the recent readout from our Phase 2b VOYAGE study of our thyroid hormone receptor beta agonist, VK2809, in NASH, demonstrated that up to 75% of VK2809-treated patients achieved NASH resolution, with no worsening of fibrosis. Up to 57% achieved at least a one-stage improvement in fibrosis with no worsening of NASH. And up to 50% achieved both the resolution of NASH and improvement in fibrosis.

We plan to schedule an end-of-Phase 2 meeting with the FDA later this year to discuss the development path for VK2809. With respect to our orphan disease program, VK0214, we recently completed enrollment in a Phase 1b study in patients with the Adrenomyeloneuropathy form of the disease and expect to announce data from this trial later this year. Finally, during the second quarter, Viking presented promising pre-clinical data from a series of new internally developed dual agonists of the amylin and calcitonin receptors at the annual meeting of the American Diabetes Association. We believe these compounds have the potential to add value to our pipeline, both as single agents, and in combination with other mechanisms. Finally to support Vikings’ maturing pipeline, the company ended the quarter with a strong balance sheet of $942 million, providing the runway needed to execute key milestones for each program.

This concludes our prepared comments for today. Thanks very much for joining us and we’ll now open the call for questions. Operator?

Q&A Session

Operator: [Operator Instructions] Our first question comes from Joon Lee with Truist Securities. Please go ahead.

Asim Rana: Good afternoon. This is Asim on for Joon. Congrats on the quarter and thanks for taking the questions. So, further in response from the FDA, has the FDA made any commentary on Phase 3 design or what the Phase 2 conversations we’ve sent around? And just to make sure I heard correctly, is monthly dosing on the consideration for the Phase 3? And just one more. You know, based on what you’ve seen so far in terms of tolerability for the oral, are you considering additional cohorts beyond 100 milligrams? Thank you.

Brian Lian: Hi, Asim. Thanks for the questions. So the end-of-Phase 2 meeting, one of the primary goals of that dialogue, was to understand if we were okay to go forward into Phase 3. And we feel based on the feedback that we are okay to go forward. As far as trial design and things like that, that would be discussed more in a subsequent meeting and end-of-Phase 2 meeting. And as far as the details on what doses and frequencies, we’re just not in a position to outline trial design at this point. With the oral dosing, we’re at 100 milligrams right now. The dose-level review team generally meets upon completion of cohorts, and makes a recommendation whether or not to proceed. So hard to say if we would proceed. We haven’t had completion of this cohort yet.

Asim Rana: Thank you.

Brian Lian: Thanks.

Operator: Our next question comes from Steve Seedhouse with Raymond James. Please go ahead.

Steve Seedhouse: Thank you for taking the questions. Having completed the 60 and 80 milligram oral cohorts in the Phase 1 and moved to 100 milligrams, I guess the inference there is safety and tolerability were acceptable. But can you just elaborate on that inference, what you’ve seen through 80 milligrams, and if you’re also seeing a dose response on weight loss through 80 milligrams?

Brian Lian: Hi, Steve. Thanks. We’re blinded to the data. So hard to comment on weight changes. Tolerability seems to be continuing to be very encouraging. I’ll just say that.

Steve Seedhouse: Okay. On that trial, can you clarify just the titration schema of those 60, 80 and 100 milligram cohorts? What’s the starting dose and what are the titration steps there?

Brian Lian: Yes. No good question. So we typically, what we’ve done is we’ve started each cohort with the highest dose from the prior cohort. So the 40 milligrams started at 20 for a week and then went to 40. The 60 started at 40 and then went to 60, and then the 80 started at 60 and then went to 80. That’s the typical approach that we’ve used, as we escalate in doses.

Steve Seedhouse: Okay. And just regarding Phase 3, since you’re now able to move directly into that, wanted to clarify, do you have enough drug on hand and enough cash to complete the fully complete the Phase 3 program that you intend to propose to FDA for an obesity indication?

Brian Lian: Yes, another great question. Yes, we do have enough supply on hand to meet really all of our planned clinical trials with both the subcu and the oral. So, we won’t be needing further material. We’re always making material, but we won’t be needing any further material to complete the planned studies.

Steve Seedhouse: Thanks very much.

Brian Lian: Thanks, Steve.

Operator: Our next question comes from Jay Olson with Oppenheimer. Please go ahead.

Jay Olson: Oh, hi, thanks for providing this update and taking the questions. Can you please comment on how many Phase 3 studies you’re thinking of running for subcu 2735? And also, how much each study might cost? And I guess since you were considering Phase 2b versus Phase 3, I guess what were some of the deciding factors in selecting to go ahead straight to Phase 3? Thank you.

Brian Lian: Thanks, Jay. Yes, for the clinical path in Phase 3, the guidance requires two studies, and a minimum of 4,500 people in those studies with at least 3,000 exposed to the drug. As far as the specifics of the trials we plan to conduct, I think it’s early to disclose those details, but we would be looking to the guidance for the overall design strategy there. I may have forgot your… Oh, the cost yes Greg. You want to talk about the cost?

Greg Zante: Yes, Jay. I think with respect to the cost, the Phase 3 registration program for subcu would be around $300 million in forming the guidance.

Jay Olson: Okay. Great. Thank you. And if I could please sneak in one more question on the oral Phase 2 study, since that’s expected to be 13 weeks of treatment, is it fair to assume that a pivotal study could be started following the completion of the oral Phase 2 study?

Brian Lian: Good question. It’s early to say we’re kind of in the process of designing the Phase 2, but I think too early to call that.

Jay Olson: Okay. Great. Thanks so much for taking the questions.

Brian Lian: Thanks a lot, Jay.

Operator: Our next question comes from Annabel Samimy with Stifel. Please go ahead.

Annabel Samimy: Hi, thanks for taking my question. And on the 60 to 80 milligram, you’ve made clear that the safety and tolerability were holding up, and it allowed you to move into the 100 milligram. What are the thresholds to stop dosing for the oral? I guess that’s my first question. And the second is related to the Phase 3 program. Can you talk about some of the exploration that you feel that you need to do versus want to do with both the injectable, I guess as it released a titration dose finding and I guess the administration profile you mentioned, there’s going to be potential for monthly. So does this all need to be conducted within the Phase 3 or are you doing any side exploratory Phase 2s in conjunction with that? So if you can just clarify that that would be great?

Brian Lian: Yes, thanks Annabel. With the dose escalation studies with the oral formulation, normally the stopping in a Phase 1 study is driven by adverse events, or a plateau on exposures, or a plateau on some other metric that you – deem important. And so, the decision to continue escalating is driven by the dose level review team, and they’ve not indicated any reason to stop escalation. We do plan to start a Phase 2 study later this year so at some point there needs to be a decision to proceed on to the Phase 2. We’re not at that stage right now, and it’s hard to say when we would get to that stage, but we do plan to start the Phase 2 later this year. With respect to the overall Phase 3 strategy and doses and titration schedules, and the cadence of titration, also the cadence of overall dosing.

It’s just too early to discuss that right now. We’re designing the Phase 3 program right now, but it’s, we have to have the end-of-Phase 2 meeting and then outline the path forward from there.

Annabel Samimy: Okay. And then, I guess if I can ask another question related to the other program you have. So, we hear or understand that a lot of potential partners are more interested in next generation drugs. So when we hear something like that, with the – you have a dual agonist. So where do you think that fits into the mix of next generation drugs? And you have a DACRA. How important is it to move that forward as a potential next generation for, and explore different combinations or explore, exactly where it stands relative to, some of the other, novel mechanisms in development? So how are you thinking about your novelty versus potential future novelty that you have in your portfolio, and where you stand in the mix?

Brian Lian: Yes. Yes. Thanks, Annabel. And it’s always hard to know what defines the next generation. Seems like most of the oral agents today are based on older scaffolds. So what defines next generation is a little murky to us. The backbone here has been GLP-1 agonist that additional activities added onto, whether it’s a GIP or glucagon or amylin. I think having a GLP-1 GIP agonist with the potential to add amylin agonism on top of it could represent really best in industry efficacy profile. So that would be an attractive area to explore. But we’ve seen already, earlier this year, really good data from the amylin monoagonist mechanism. So, I think that program has a couple different areas that can be explored as a single agent and in potential combination with other mechanisms.

Annabel Samimy: Okay. Great. Thank you.

Brian Lian: Thanks, Annabel.

Operator: Our next question comes from Roger Song with Jefferies. Please go ahead.

Roger Song: Hi. Great. Thanks for that update and then picking up a question. Maybe just a follow-up on the partnership discussions. Understanding you have – open-door policy for the potential partner, but given this new development FDA allows you to proceed into Phase 2 directly, versus you need to do another Phase 2. Do you think that will change the conversation you have been having with the potential partners? Any comments will be helpful. And I have a follow-up?

Brian Lian: Yes, sure. Thanks, Roger. Yes, no real additional comment to add on partner discussions. We’ve been consistent with our receptivity to interests and opportunities and we remain so. In the meantime, we are well capitalized and focused on execution of the development programs. And I think in our view, continued execution will continue to add value to the pipeline. I think that is all we can say at this point.

Roger Song: Yes. Understood. And then another key topic is related to the scalability, particularly for your – now you have two formulations, subcu and oral, particularly with oral. Understanding you have been having discussion with and on various CDMO, can you just remind us and what the scale of the investment in terms of the dollar and the time to be able to build the capacity to potentially meet commercial demand as an oral peptide, also considering your – this dosing is going even higher with the good probability?

Brian Lian: Yes, good question, Roger. I mean, we – in answer to Steve’s question, we currently have enough API to get through all of our planned clinical studies, with both the subcu and the oral. And we continue to engage with suppliers for both the raw materials, and the finished product. And we certainly expect, to be able to supply the initial commercial demand at the appropriate time. What the CapEx requirement is, it’s probably a better question for the CDMOs, or the companies that are building out their own facilities. At this point, our supply will be derived from CDMO sources though. So the CapEx from Viking is limited.

Roger Song: Got it. Thank you, Brian.

Brian Lian: Thanks, Roger.

Operator: Our next question comes from Andy Hsieh with William Blair. Please go ahead.

Andrew Hsieh: Thanks for taking our questions. So Brian, I’m curious about your strategic positioning for the amylin program. I’m just curious what areas you would like to potentially position this asset. Would it be increasing the magnitude of weight loss and type 2 diabetes, or the preservation of lean body mass? So that’s question number one. I’d also like to take your temperature on two topics, if you don’t mind. One is on the titration. If you look across the landscape, it seems like other companies are exploring more rapid titration, with kind of a more aggressive step up. Is that something that is worthwhile exploring for the 2735 program? And the other topic is really on the monthly dosing that you just mentioned. Obviously, with the half-life at the end of the cycle, the drug level would be pretty low.

Just curious if you can talk about that delta when you go from the end of the cycle to the next cycle, that increase and its relevance to the AE profile. And I have two just really quick checking questions?

Brian Lian: Sure. I’ll try to remember these, but you may have to repeat one or more. So with the amylin compound, really interesting mechanism that as a standalone, I think, has a lot of promise. And in combination, I think, also has a lot of promise. And we think both are worth exploring. So where they would actually position in the overall landscape, it’s early to say, but to the extent maybe you could spare GLP-1 use, or not and see even further improvements in efficacy, we just don’t know yet what that profile will look like. So, we’ll have to follow where the data lead us. As far as the question on the different titration approaches, I think our tolerability profile and the PK profile would lend themselves to alternative titration cadences.

But we did the three-week in the VENTURE study, which looked really promising. I think we could probably go to two weeks. Certainly, we could use four weeks, and maybe that would lead to an even further improvement in tolerability. So we’re not yet at a position to say one way or another what’s the, preferred titration scheme, but I think we could probably go faster. With respect to the monthly dosing, you’re right. As you dose monthly, by the end of the month, now keep in mind that the half-life is 180 hours or so, so it’s more than one week. But by the end of the month, you are at a lower level than you were at the beginning of the month. And as long as you’re in a therapeutic range, that next dose might not be expected to result in any tolerability challenges.

We won’t know until we get into a study using it, but it seems like generally with these mechanisms, tolerability is observed early. And if you get through those first few weeks, tolerability tends to wane, at least with the injectables. And tolerability issues seem to wane. So if you’re within the therapeutic plasma levels for 28 days or 30 days, and you’re just raising those levels a little bit, it seems like you would reduce the risk of tolerability challenges. But again, hard to say at this point.

Andrew Hsieh: Yes, that’s super, super helpful. And then, Greg, maybe just one quick one. So for the $300 million cost that you mentioned, does that include a cardiovascular outcomes trial? And then, I guess the monthly dosing that, Brian, you’re talking about, I’m assuming that you’re talking about that in the context of a Phase 2 study and not a Phase 3 study?

Greg Zante: Andy, on the cost side, that’s just the $300 million is the Phase 3 registration program, not any outcomes additional studies for that.

Andrew Hsieh: Got it.

Greg Zante: And then with the monthly, yes, we haven’t decided what the next study will look like with the monthly at this point.

Andrew Hsieh: Okay. That’s very helpful. Thank you so much.

Brian Lian: Thanks, Andy.

Operator: Our next question comes from Mike Ulz with Morgan Stanley. Please go ahead.

Rohit Bhasin: Hi, this is Rohit on for Mike. Thanks for taking our questions. Just in terms of dose escalating for oral VK2735, is there a point where tablet size and available supply become an issue and how high you can dose the drug? Thanks.

Brian Lian: Yes, no, it’s a good question. Probably, we’re not there just yet. But yes, I think those are considerations that need to be taken into account, when you dose up with oral. I think, moving forward, if the oral was used as a maintenance therapy after target weight was achieved, that likely reduces dramatically the actual requirements of API. And if the dosing were able to be less frequent, that also would dramatically reduce the API demand. So a lot of moving parts there in trying to project the API demands moving forward.

Rohit Bhasin: Thank you.

Operator: Our next question comes from Justin Zelin with BTIG. Please go ahead.

Justin Zelin: Hi, Brian. Thanks for taking the question and congrats on the progress here. Maybe just the decision to move to a monthly dosing regimen, including that in the move forward program, is that based off of the PK/PD data that you’ve seen thus far? And do you think you’ll be able to present that data perhaps at Obesity Week?

Brian Lian: Yes, no, thanks, Justin. Yes, it is based on the PK profile. The PK profile does suggest that monthly is feasible. We won’t know until we actually do a study, but at least what it looks like today, is it’s feasible.

Justin Zelin: Great. Thanks for taking my question.

Brian Lian: Thanks, Justin.

Operator: Our next question comes from Thomas Smith with Leerink Partners. Please go ahead.

Thomas Smith: Hi, guys. Good afternoon. Thanks for taking the questions and congrats on the progress. So you’re going to have multiple Phase 3 programs ready to start here in the – pretty much in the near term. I know you’ve previously talked about having a partner, potentially for NASH. Could you just provide an update on how you’re thinking about business development and partnerships across obesity and NASH, and I guess your appetite to execute across these programs on your own?

Brian Lian: Yes, thanks, Tom. I mean, we’re capitalized to proceed with all of these programs. Fortunately with the obesity program, we will be moving aggressively into a Phase 3 development program as soon as possible. With the NASH program, the plan there is to have an end-to-Phase 2 meeting and receive the feedback and understand what the current thinking is, around registration paths. And what we’ve been saying, or what we’ve been preferring with that program really, is to work with a larger party together on a registration path. So that remains the preference for the NASH program.

Thomas Smith: Got it. That makes sense. And then I just wanted to ask, one, just on sort of the earlier, maybe preclinical work you have ongoing in obesity. I mean, you’re going to move the DACRA program into the clinic next year. It seems like a pretty quick turnaround from preclinical and getting that into the clinic. Can you just talk about some of the other targets that you, I guess, may be interested in, but more about, how much preclinical work you have ongoing with respect to some of these targets, and how we could think about the potential cadence, or the timing for advancing some of these earlier efforts into the clinic?

Brian Lian: Yes. No, thanks, Tom. We’re pretty busy and pretty everybody’s stretched pretty thin. We do have other programs that we haven’t disclosed that I think will, over time, add further value to the pipeline. So it remains a pretty active, preclinical development remains a pretty active component of the company’s activities. But we generally don’t disclose targets, and that work until we’re a little bit closer to the decision to move into the clinic.

Thomas Smith: Got it. Understood. Thanks for taking the questions guys.

Brian Lian: Thanks, Tom.

Operator: Our next question comes from Yale Jen with Laidlaw Company. Please go ahead.

Yale Jen: Good afternoon. Thanks for taking the questions and congrats on all the progress. I got two questions here. The first one is in terms of the oral 2735 for the Obesity Week readouts. Do we anticipate that will also include the 100 milligrams as well? And so would that be the also use that as a basis for your 13-week study? Then I have a follow-up?

Brian Lian: Yes, thanks, Yale. We will present all of the data that we have at the time, and I would expect the 100 milligrams cohort to be included. And as far as the Phase 2 doses, we haven’t decided yet. So, we need to complete the ongoing cohorts and understand, get unblinded on the data and understand what the profile looks like before we select those doses.

Yale Jen: Okay. Great. That’s helpful. And the next question here is basically, for the end-of-Phase 2 meetings, what do you anticipate to bring on the table in terms of the subjects you want to discuss at least at this point? Thanks.

Brian Lian: Well, with the target population, normally that’s pretty well defined by the guidance. It’s a BMI of at least 30, or at least 27 – with at least one weight-related comorbidity. And then in the second study, it’s generally overweight people with type 2 diabetes. So those would be, broadly speaking, the target populations for the Phase 3 program.

Yale Jen: Okay. Great. That’s very helpful. I appreciate that.

Brian Lian: Thanks, Yale.

Operator: This concludes our question and answer session. I would like to turn the conference back over to Stephanie Diaz for any closing remarks.

Stephanie Diaz: Thank you all for dialing in today and for your continued support of Viking Therapeutics. We look forward to speaking again soon. Thank you and have a good afternoon.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.