Alector, Inc.

Good afternoon, ladies and gentlemen, and welcome to the Elector Second Quarter and Mid-Year 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 1 again. As a reminder, this conference call is being recorded. I would now like to turn the call over to Katie Hogan, Senior Director of Corporate Communications and Investor Relations. Please go ahead.

Thank you, Operator, and hello, everyone. Earlier this afternoon, we released our financial results for the second quarter, 2025. The press release is available on our website at www.elector.com. And our 10Q was filed with the Securities and Exchange Commission this afternoon. Joining me on the call today are Dr. Arnon Rosenthal, co-founder and CEO, Dr. Sarah Kankari Mitra, President and Head of Research and Development, Dr. Giacomo Salvadore, Chief Medical Officer, Neil Berkley, Chief Business Officer and Interim Chief Financial Officer, and guest speaker, Dr. Ryan Darby, associate professor of neurology, and director of the Frontal Temporal Dementia Clinic at Vanderbilt University Medical Center, as well as a paid consultant to a lector who will provide clinical context on frontal temporal dementia. After our formal remarks, we'll open the call for Q&A. I'd like to note that during this call, we'll be making a number of forward-looking statements. Please take a moment to review our slide on the webcast, which contains our forward-looking statement disclosure, And we also encourage you to review our SEC filings for more information. I would now like to turn the call over to Arnon Rosenthal, Chief Executive Officer. Arnon?

Thank you, Katie, and good afternoon, everyone. As we enter the second half of 2025, electo is approaching an important inflection point. By mid-first quarter, we expect top-line data from our pivotal Phase III in front-tree trial of latosinamab, our most advanced clinical program. This trial represents the first rigorous test of progallonic elevating approach to treating frontotemporal dementia due to the GRN gene mutation, a fatal and rare form of dementia that strikes people decades earlier than Alzheimer's disease and currently has no approved therapy. We designed latazinamab based on clear biological and human genetic rationale to elevate progranulin levels by blocking its internalization and degradation by sotilin receptor. FTD-GRN is directly caused by progranulin deficiency, and restoring it has the potential to alter the cause of the disease. Our earlier studies in participants with FTD-GRN provided encouraging signals both in biomarkers and in clinical progression. In front three will allow us to determine whether those findings hold up in a larger placebo-controlled double-blinded trial. Together with our partner GSK, we are advancing lunch readiness activities to help ensure we are well-positioned to support the potential commercializations of ratosinema. Additionally, we are also excited about our late stage clinical program in early Alzheimer's disease, where we are advancing AL-101, our second progranulone elevating antibody, which is currently in phase two trial. There is a strong genetic and biological rationale for the role of progranulone in Alzheimer's disease. Lots of function mutations in progranulone have been shown to increase the risk of Alzheimer's disease in humans, while overexpression of progranoline has been shown to be protective in animal models of Alzheimer's disease. Enrollment of this phase II trial was completed in April, and trial completion is expected in 2026. AL-101 shares a similar mechanism with latosinamab, but its pharmacological properties makes it suitable for more prevalent neurodegenerative diseases. In parallel, we are investing in a research and preclinical pipeline designed to fuel our future. These programs include our proprietary anti-amyloid beta antibody for Alzheimer's disease, an engineered GKs enzyme replacement therapy for Parkinson's disease, and an anti-Tau siRNA for Alzheimer's disease, all enabled by elective brain carriers. our proprietary technology platform that enables us to deliver antibodies, proteins, enzymes, and siRNA across the blood-brain barrier. This opened the door to more effective brain-directed therapies across multiple modalities. Our late-stage clinical programs, combined with our early-stage pipelines enabled by our proprietary blood-brain barrier technology, gives us the opportunity to deliver both near-term catalysts and sustained pipeline momentum. Our goal is to deliver therapies that eradicate neurodegeneration and improve patients' outcomes, and in doing so, build a durable, high-impact biotechnology company. Our commitment to tackling neurodegeneration drives us to engage experts who understand these diseases firsthand It is my pleasure to introduce Dr. Ryan Darby, Associate Professor of Neurology and Director of the Frontotemporal Dementia Clinic at Vanderbilt University Medical Center. Dr. Darby brings deep clinical expertise in frontotemporal dementia and will speak to the urgent unmet need in this disease. Dr. Darby received his undergraduate degree from Princeton University in Psychology and Neuroscience. and his medical degree from Vanderbilt University. He trained in neurology at MGH and Brigham and Women Hospital as part of the partner neurology Harvard Medical School Program. Dr. Darby's research focuses on neurodegeneration's impact on brain networks related to behavior and decision making. His contributions to the field have been recognized with awards such as the Norman Gershwin Prize in Behavioral Neurology. Dr. Darby, thank you for joining us today. I will now turn the call over to you.

Thank you so much for the kind introduction. Today, I'll be providing an overview of frontotemporal dementia, or FTD, which is a complex and devastating group of neurodegenerative conditions that impact thousands of individuals and their families worldwide. We'll touch on its subtypes, the clinical progression, the genetic drivers like FTD, GRN, and the current and future landscape of treatment and diagnosis. FTD is not a single disease, but instead a group of disorders caused by progressive neuronal cell loss in the brain's frontal and temporal lobes. This neurodegeneration leads to a broad range of symptoms, and we categorize FTD into different clinical subtypes based on those symptoms and the areas of the brain that are affected first. First, we have the behavioral variance FTD or BVFTD, which is the most common form. It's characterized by striking changes in personality and behavior such as apathy, impulsivity, and socially inappropriate behaviors. Next, there's primary progressive aphasia or PPA. which primarily impacts language. In FTD, this is further subdivided into two main subtypes, the semantic variants, where individuals lose their understanding of word meaning, and the non-fluent variant, where speech becomes halting and effortful. Finally, we have FTD that presents with motor or movement-related symptoms, and this can present with overlapping conditions such as progressive supranuclear palsy, or PSP, cortical basal syndrome, or CVS, and ALS-FTD, which combines features of motor neuron disease with FTD. These clinical presentations fall under the broad umbrella term frontotemporal lobar degeneration, or FTLD, which is the pathological term reflecting that underlying biology. FTD is most commonly associated with the buildup of two key proteins, GDP43 and tau. However, determining which protein is involved in a living patient is extremely difficult unless there's a known genetic mutation or after death at a postmortem examination. FTD itself is more rare than Alzheimer's, but it's still the most common cause of dementia in individuals under the age of 60. In the US, the incidence is estimated to be 15 to 22 cases per 100,000 person years, which results in a prevalence of about 50 to 60,000 concurrent cases in the US. In Europe, the number is closer to 110,000. The toll on individuals and their families in FTD is profound. FTD compared to other dementias often leads to greater functional impairments in the activities of daily living, earlier onset, frequently disrupting careers, relationships, and independence. Caregivers in FTD often report a higher burden and more painful loss of sense of personal identity and personhood compared to Alzheimer's disease, in part because these patients are presenting with emotionally disengaged symptoms and inappropriate behaviors. Approximately 30% of FTD cases have a strong family history. We now recommend that there are three main autosomal dominant genetic mutations in FTD. The C9 ORF72 mutation, the MAPT mutation, and the GRN mutation. There's at least 20 other rare mutations that are also known to be associated with FTD. Today, we're focusing on FTD-GRN, which represents about 5% to 10% of FTD cases. This is a form that results from mutations in the GRN gene leading to reduced levels of progranulin, a critical protein for neuronal survival and function. Progranulin deficiency contributes to neurodegeneration through multiple potential mechanisms, including lysosomal dysfunction and inflammation. Emerging biomarkers such as neurofilament light chain, or NFL, and changes in structural brain MRI are helping us to track disease progression and onset of neuronal loss more objectively. Unfortunately, there are no FDA-approved disease-modifying treatments for FTD. Management currently is largely symptomatic and supportive, often involving behavioral strategies, speech therapy, and medications targeting mood or agitation. However, there is hope on the horizon. With ongoing clinical trials now targeting genetic forms of FTD, including GRI mutations, this offers an exciting opportunity to address the disease at the molecular level and develop new therapies. However, we face several key challenges. First is the diagnostic complexity. FDD is frequently misdiagnosed or diagnosed late in the disease course. Genetic testing is not routinely performed. And even in younger patients, we often lack information about the underlying protein pathology, making it difficult to tailor interventions or enroll appropriate patients in clinical trials. Trial design is another challenge. Symptoms vary widely, not just from patient to patient, but even in the same person over time. And that can include the full range of behavioral, psychiatric, language, and motor features. We need better tools to identify patients earlier in that disease course and better ways of tracking that disease over time. Finally, there's an urgent need for disease-modifying therapies, especially in the genetic subtypes where the biology is known. Advances in biomarkers are helping move the field forward by enabling early diagnosis, better stratification, and more sensitive tracking of disease progression. So in closing, FTD is a complex and deeply impactful disease, both biologically and also personally for the patients and families. With increased understanding of the genetic underpinnings like GRN mutation and the development of robust biomarkers, we're now in the position to truly develop transformative therapies. So with that, I'll turn the call over to Giacomo Salvador, Elector's Chief Medical Officer.

Thank you, Dr. Darby, for that insightful overview of the clinical realities and urgent admin needs in front of the temporal dementia. Your perspective helps frame the importance of our work as we approach the in-front free data readout by MIG-Q4. As Dr. Darby noted, FTD-GRN accounts for approximately 5% to 10% of all FTD cases. This represents about 8,000 to 17,000 cases in the US and EU alone. It is striking how many people living with FTD still have no approved treatment options today, underscoring the need for continued innovation and urgency in this field. With this context in mind, I want to provide a deeper overview of the science behind our approach. the data we have generated to date, and how our pivotal phase 3 in-front retrial is structured. Latozinemab is a novel investigational human monoclonal antibody developed in collaboration with GSK, and we believe it is the most advanced therapeutic candidate in development for FT-DGRN. We have evaluated Latozinemab in both phase 1 and phase 2 clinical studies, In phase one, the treatment was well-tolerated in healthy volunteers, and those dependent increases in plasma progranulin were observed. Our open-label phase two InFRONT2 study enrolled 12 participants with symptomatic FT-DGRN. Treatment with latozinemab normalized plasma and CSF progranulin levels, resulting in a two- to three-fold increase that was rapid and sustained over the course of treatment. We also assessed a panel of disease-relevant biomarkers, including neurofilament light chain, NFL, glial fibrillary acidic protein, GFAP, and markers of lysosomal function and neuroinflammation. These biomarkers moved in the direction consistent with slowing disease progression. On the clinical side, we used the CDR plus NAC FTLD-SB, a validated scale for FTD that captures cognitive, functional, behavioral, and language changes. In a blinded propensity match comparison to participants from the GEMFI-2 natural history study, treatment with latuzinamab was associated with a 48% slowing of disease progression over 12 months. These are the same clinical measures and core biomarkers being carried forward into Infront3, our ongoing pivotal phase 3 trial. Infront3 is a 96-weeks randomized, double-blind, placebo-controlled global trial evaluating latocinamabin-103 symptomatic and 16 at-risk individuals with confirmed GRN mutations. Participants received 60 milligrams per kilogram of blatozinemab, or Plativo, via intravenous infusion every four weeks. The primary analysis will be conducted in symptomatic participants, and we plan to include at-risk participants in the sensitivity analysis. The clinical primary endpoint is the CDR plus NAC, FTLD, some of boxes. Following engagement with the FDA, and in line with the agency's recommendation, we and GSK have made the decision to amend the statistical analysis plan for Infront3 to include plasma progranulin as a co-primary endpoint, along with the CDR plus NAC FTLD-SB. Keep in mind that an approximate 50% reduction in progranulin is a causal factor for FTD-GRN, Additionally, we are collecting fluid and imaging biomarkers, including plasma NFL, GFAP, and volumetric MRI. We believe this positions us to deliver a clear and well-aligned data package later this year. Infront3 is approximately 90% powered to detect a 40% slowing of disease progression. If our key design assumptions hold, A 25% slowing is expected to be significantly significant, and we believe that will represent a meaningful clinical benefit in a disease with no approved treatments. Lactosinema has been generally well-tolerated across our clinical trials. We know major safety signals observed today in either healthy volunteers or patients with FTD-GRN. As a reminder, Latozinemab has received breakthrough therapy and fast track designations from the FDA, endorphin drug designation from both the FDA and the EMA. Following the receipt of the breakthrough therapy designation, which was granted based on our phase two data, we had a type B interaction with the FDA to address key elements of a potential future biologic license application. The agency indicated that the totality of the evidence, including clinical outcomes and disease-relevant biomarkers, could support a submission for full approval pending VLA review. Additionally, we aligned on a set of fluid and imaging biomarkers that may serve as supportive efficacy data. We and GSK are preparing for potential BLA and MAA submissions in 2026, seeking full approval based on the strength of our trial design. Latozinema represents a biomarker-driven, mechanistically targeted approach to treating genetically defined FTD-GRN, a severe degenerative disease with no approved therapies. We believe the strength of our clinical data, the alignment with regulators, and the breadth of our clinical and biomarker package position us well as we prepare for the infant rereadout by mid Q4. Let me also briefly comment on AL101, our second progranulin-elevating monoclonal antibody. AL101 is a distinct molecule that targets a different epitope on sorrelin and has a different pharmacokinetic and pharmacodynamic profile, making it suitable for more prevalent neurodegenerative diseases. Importantly, as Arnold mentioned, our rationale for evaluating a progranulin-elevating approach in Alzheimer's disease is grounded in human genetics. Reduced GRN expression has been implicated in Alzheimer's pathophysiology. supporting the potential of programming modulation in that setting. AL101 is currently being evaluated in early Alzheimer's disease with enrollment in the Global Phase II Progress AV Study completed in April and trial completion expected in 2026. With that, I'll now turn the call over to Sara to share an update on our preclinical and research pipeline.

Thank you, Giacomo. As you've heard today, we are advancing our late-stage clinical programs, which have a strong scientific rationale, robust trial designs, and meaningful regulatory engagement. In parallel, we are advancing a research and preclinical pipeline that reflects a lecturer's long-term vision. These programs are grounded in the same principles that define our clinical portfolio. a strong genetic and biological rationale, and high translational potential, and a focus on serious neurodegenerative diseases with first and best-in-class therapeutic approaches. A key enabler of our preclinical and research programs is our proprietary electrobrain carrier. Delivery of sufficient drug to the brain remains a challenge for targeting neurodegenerative diseases. Our ABC platform is a versatile blood-brain barrier transport technology that allows us to efficiently deliver a broad range of therapeutic modalities into the brain. These include antibodies, proteins, enzymes, and siRNA. By selectively applying the ABC platform to drug cargoes, where enhanced brain delivery can address known limitations of efficacy or safety, we believe we can expand what is possible in the treatment of neurodegenerative diseases. Our preclinical programs include a brain-penetrant anti-amyloid beta antibody for Alzheimer's disease, where a significant unmet need remains despite the approval of anti-amyloid beta antibodies. These approved antibodies have delivered plaque clearance, but only modest clinical benefit, and they are associated with side effects, such as amyloid-related imaging abnormalities, or ARIA, which limit their use. As a result, the field is increasingly focused on brain-penetrant anti-Aveda antibodies that aim to increase efficacy, reduce the incidence of ARIA, enable subcutaneous delivery, and the possibility of prevention therapy. Our anti-amyloid beta antibody, ADP037-ABC, is designed to deliver on these goals. It combines a validated anti-A-beta epitope, a tailored FC region, supporting robust plaque clearance, and our proprietary brain delivery ABC platform. While an emerging brain-penetrant anti-amyloid beta antibody has shown improved brain exposure and reduced incidence of ARIA in the clinic, it has introduced anemia related to transferrin receptor engagement on erythroid precursor cells as a safety concern. ADP037-ABC also uses the transferrin receptor for transport, but it is specifically engineered to minimize anemia risk while enhancing amyloid beta clearance. With these features, we believe that ADP037-ABC has the potential to be a best-in-class anti-amyloid candidate. Another program I'd like to highlight is ADP050-ABC, our engineered GKs replacement therapy. Mutations in the GBA1 gene lead to reduced activity of the lysosomal enzyme glucocerebrosidase, or GKs, and are associated with Gaucher disease, Parkinson's disease, and Lewy body dementia. While enzyme replacement therapies are approved for the peripheral manifestations of Gaucher disease, these therapies do not cross the blood-brain barrier and therefore have limited impact on neurological symptoms. With ADP050-ABC, We aim to deliver an engineered, more stable, active form of GKs to the brain, potentially restoring lysosomal function in nerve cells and ultimately countering the brain pathologies associated with Gaucher disease, Parkinson's disease, and Lewy body dementia. Beyond these two programs, we continue to develop a focused set of research stage candidates addressing neurodegeneration through the removal of toxic proteins replacement of deficient proteins, and restoration of immune and synaptic function. These include a brain-penetrant tau-targeting antibody, a brain-penetrant anti-tau siRNA, and a relian moderator. With that, I'll turn the call over to Neil to provide an update on our financials.

Thank you, Sarah. As summarized in our second quarter 2025 financial results, which we made available after the market closed today, we are in a strong position to deliver against our strategic objectives. We closed the quarter with $307.3 million in cash, which we continue to expect will provide runway into the second half of 2027. We have updated our 2025 financial guidance. We anticipate collaboration revenue to be between $13 million and $18 million, our total research and development guidance to be between $130 million and $140 million, and our total general and administrative guidance to be between $55 million and $65 million. Our financial position enables us to stay focused on execution across our late-stage clinical, preclinical, and research pipeline. We look forward to providing additional updates as we progress our work. That concludes our prepared comments for today's call. Operator, you may now open the line for questions.

Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again.

Please stand by while we compile the Q&A roster. Our first question comes from the line of Tom Schrader of BTIG.

Your line is now open.

Good afternoon. Thanks for taking the questions. I just wanted to clarify, in the statistical analysis plan, is the only change that you've added progranulin, or is there something else there? And just give us a sense of why you added that. Progranulin, I mean, on average, it normalized, but does it normalize in every patient in your prior trials? I'm just trying to understand why you're doing this. And then on the ABHC portfolio, is it mostly transferrin receptor-based, or are you using other receptors? Thank you.

Thanks for your question. This is Giacomo Salvatore, the chief medical officer. The change in our statistical analysis plan to include progranulin as a co-primary endpoint was reactive to a specific request by the FDA, by statistical reviewer by the FDA, who asked us to make this change to the statistical analysis plan and recognizing the important mechanistic role of progranulin. This is the only change made following a specific comment by a statistical FDA reviewer. Regarding your question about the effect of progranulin in the population of patients with FTD-GRN, we have analyzed plasma progranulin in the Phase II study. and we showed a two to threefold increase in programming after treatment with Latozinemab. Overall, based on our phase two data, as well as the longitudinal data from observational studies, we believe that we have more than 99% power to show statistically significant effect on programming.

Maybe I'll take the question on the ABC platform, Tom. So yes, while we are exploring other transporter-related transport vehicles, our lead programs that we are talking about do depend on the transfer and mediated process.

OK, great. Thank you.

Just to add to Giacomo, We are not aware of any case where we treated patients without drug and we didn't see elevation of progranuline. So progranuline is consistently being elevated in treated individuals, both healthy individuals and FTD mutation carriers.

Okay. All right. Thank you.

Our next question comes from the line of Myles Minter of William Blair. Your line is now open.

Yeah, following on from Thomas' first question, why did that reviewer request plasma progranulin? Like, this is an antibody. I assume it's largely peripherally restricted with some minimal getting into the brain. I know tapping these patients frequently in terms of CSF and measuring progranulin is probably problematic at this stage, but is that reviewer like, are they basically agreeing that plasma progranulin with a largely peripherally restricted antibody driving that upregulation is predictive of functional benefit in a CNS disorder like frontotemporal dementia? That's the first one. And then if Dr. Darby is still on the line, um, I think in front three at its bare minimal was powered to show a 25% improvement in the slowing of cognitive decline in this trial. Just on the background of what we've seen with the uptake of anti-amyloid therapies in Alzheimer's disease showing a 27% slowing of decline, I know there's some safety concerns with that, but if it was 25%, is that still an attractive product to prescribe to this patient population? Thank you very much.

Thank you very much for your question. So, the FDA didn't provide detailed rationale for their input on the analysis plan and rationale behind their suggested change and elevating programming at co-primary endpoints. We believe that the FDA input underlines the importance of programming as a biologically meaningful marker in FDD-GRN. mutation in progranulin gene, in granulin gene leads to upload insufficiency and is a known case of the disease. Another point to underline is the fact that we had prior discussion with the FDA, and we disclosed those in previous calls, and we had an agreement that elevation of progranulin could subserve as confirmatory evidence. in our LATOS-DINEMA program. So this change follows some previous discussions that we have disclosed before. Regarding your second comments on peripheral versus central, in the Phase II study, we were able to show robust increases of progranulin, two to threefold, both in the CSF as well as in plasma. Therefore, our previous data indicates a strong effect no matter what the compartment is chosen to study programming elevation.

Yes, there is a really good correlation with our drug between the serum and the CSF. both in healthy volunteers and in patients, and in both of our drugs, both in 001 and 101. So with both of our drugs, the plasma progranoling appears to be a good representation of what actually will also happen in the CSF in the brain.

Hi, this is Ryan Darby.

I can answer the other questions now is the right time. So in terms of that clinical benefit, I think a 25% reduction would be something that would be meaningful in a disease where we don't have any other therapeutic options. I think in the anti-amyloid infusion comparison, the issues with implementation there I think center around the side effects and that cost-benefit profile that we're discussing with patients where some patients would opt away from that. I think an FTD with no other viable treatment options, there'd be more of an interest in that. Would obviously depend on the other side effect profile and what that looked like.

Beautiful. Thanks for the questions. Yes.

So far, our drug appears to be very well tolerated. There are no drug-related adverse effects, so it will be, with regard to safety, appear to be a different profile than the anti-abeta therapeutics.

All right. Thank you.

Our next question comes from the line of Alex Stradahan of Bank of America. Your line is now open.

Hey, guys. Thanks for taking our questions. One on AL001 from us as well. Curious how changing the SAP at this stage could affect powering on the modified CDR-SOMA boxes since plasma of PGRN is now a co-primary. And in your discussions with the FDA and or GSK, I'm curious if expanded enrollment in Front 3 was part of your discussions at all. And given the FDA's apparent focus on PGRN levels, have you gotten a sense whether plasma PGRN could make its way onto the label as well for selection.

Thanks. Thanks for your questions.

So, to start, regarding our program, how the change in the SAP to include programming as co-primary affects the power the conduct of the study, I can tell you that having two co-primary endpoints, one clinical, that is the CDR, FTLD, sum of boxes, and progranulin, we need to show statistically significance on both co-primary endpoints for the study to be positive. Having said that, these two co-primary endpoints are analyzed independently, meaning that the power regarding the CR sum of boxes remain unchanged. And as I said before, regarding progranulin, based on our Phase II data, we have more than 99% power to show a significant effect on elevating progranulin. The other... Sorry, can you repeat the other question?

yeah just just given the the focus of the fda on on plasma pgrn curious if this could be um you know a potential uh yeah there comes with the population on uh on the label yeah we haven't had any discussions about labeling and we will we will entertain discussion with regulators

after we have the trial readout in mid-Q4 2025, but we didn't have any discussion about programming being part of the label.

Understood. Thank you very much.

Thank you. Our next question comes from the line of Yaron Werber of TD Securities. Your line is now open.

Thank you very much for the question. This is Steven Ionov on for your own work. Did the FDA mention any particular threshold that they wanted to see for progranulin, or is that just statistical significance? And then to follow up, you mentioned the 90% power to see a 40% lowering. Are you tying that in any way to the progranulin levels, or is that just still the sum of boxes on point? Thank you.

Sure. The FDA didn't specify any particular threshold regarding the elevation of progranulin that they would want to see based on our trial data. They simply provided a comment that they recommended us to include progranulin change as co-primary endpoint. Then the other question was about the powering and of the study's power for 40% zoonotic progression with LATOS-DINEMA versus placebo. And this power remains unchanged after the modification. As I mentioned just now, the CDF-SOMO boxes and programming have analyzed separately. So the initial assumption regarding CDR remains unchanged and there is no change regarding the CDR sum of boxes. And programmatically we are 99% powered based on our phase two data. So we don't think it's going to affect the probability of success overall. But considering the fact that we, in order for the study to be positive, we need to show significance on both co-primary endpoints.

Yeah, I'd just like to add again that even if we see 25% slowdown in cognitive decline, this will be statistically significant, clinically meaningful, and will most likely be approvable.

Understood. Thank you very much.

Thank you. Our next question comes from the line of Sean Lauman of Morgan Stanley. Your line is now open.

Hi. This is Mike Riadon for Sean. Thank you for taking our questions, and congratulations on completing Enrollment for Progress. We have two questions. First one's for Dr. Darby. We'd love to hear your thoughts. Assuming success restoring progranulin to normal levels in FTG progranulin, like flowing CDRS-B, would that increase your confidence in elevating progranion above endogenous levels, like being beneficial to patients with Alzheimer's?

Yeah, that's an interesting question.

You know, I think that certainly showing that you can modify the level and have a benefit would help support that. I don't know if it would move you all the way to saying that supra-normal levels would have increased benefit, if I'm understanding that question. But certainly, restoring to normal levels, you know, shows that the intervention can do that, and if it's associated with a clinical benefit, that it can have an impact.

Oh, thanks. That makes sense. And then maybe just, sorry, just a quick follow-up. What would be, like, your view on, like, other FTD subtypes?

Yeah, I mean, I think it would definitely make me curious of seeing what that effect could potentially be so that, you know, if this is protective, would going even above the normal levels be helpful? I think it would open up that possibility where if there is a subset of patients with relatively lower, you know, even if it's not to the level of progranulin carriers, would that be a good treatment target? And then you'd be able to show that there is something that is potentially able to do that.

Thank you so much. That's really helpful. And then I guess my follow-up question would be for management. For Infant 3, given the potential for interpatient variability on baseline progranulin level, be it by stage of disease or other factors, be it like semantic or motor disruptions, like how are you normalizing for that? Is it like the FDA requesting like a within-subjects comparison from baseline to study end? Or is it more like an aggregate comparison between study arms?

I can take this one. So we are finalizing the SAP in close discussion with the FDA, and we are going to analyze plasma programming change in the active arm versus placebo. So we didn't have any specific requests. I can add the fact that Aploinsufficiency in the granuline gene is associated with 50% reduction of progranuline levels, and this is enough to produce a disease phenotype, meaning that 50% decrease in progranuline level are almost invariably associated with frontotemporal dementia and development of the full-blown disease. Our previous data showed two, three-fold elevation of plasma progranulin, and also the CSF data are very consistent with that, and we were able to show normalization of those levels in individuals who had baseline deficits. So, Arnold, I don't know if you want to add anything, but we see consistently low levels of progranulin in patients with FTD-GRN. This is a functional mutation which is associated with the disease phenotype.

Yes. Mechanistically, the mutations that cause frontotemporal dementia are full heterozygous loss of function. These are coding mutations that leads to complete ablation of the mutated protein. There's no gradation in the mutated protein. Every individual that has mutations that cause from the temporal dimensions are coding mutations that lead to haploid insufficiency, like 50% or less of the progranulin. The promoter mutations are actually the three prime untranslated mutations that you refer to are a different class of mutation. These are mutations that are associated with very modest reduction. in programming of 10% to 15%, and they are associated with other diseases like Parkinson's disease and Alzheimer's disease. But they don't lead to fraudotemporal dementia.

Thank you so much. That's been really helpful. I appreciate all the calling.

Thank you. Our next question comes from the line of Greg Zuvanovich of Mizuho. Your line is now open.

Hi there, this is Doug MacPherson on for Greg. Thank you very much for having me on and taking my call, or question rather. So thinking about the relative subjectivity of the endpoints of clinician severity score and the rating scales compared to biomarker data, is there anything that can be done or has been undertaken in order to try to minimize perhaps a placebo effect or to optimize for like the spread or separation between active drug and placebo?

Thanks for the question.

The powering of the study take into account also the expected placebo change based on the natural history data and the natural course of the disease. Regarding biomarkers, they are unlikely to show any placebo effect. Those are objective measures, NFL as well as GFAP and volumetric MRI. There is no placebo effect as far as we know. Regarding, broadly speaking, the placebo effects on clinical Alaskan measures, what we know from neurodegenerative diseases is that if placebo effects are present at all, they typically tend to be manifest in the first few weeks of treatment and they tend to dissipate over time. Our trials are the infant-free studies, 96 weeks long, and in a disease that shows progression over time. So we don't see the placebo effect as a particular risk for this kind of indication.

Sure. Thank you for that. Appreciate it. And then a quick follow-up. Yes. Should we at all be concerned about ARIA for TRAEs? And if so, what would be sort of an acceptable ARIA prevalence or severity in treated patients?

Yeah, you're asking about which program in particular?

Oh, I'm still on the FTD phase three study.

So we are monitoring blinded safety periodically, and there is an independent monitoring committee which oversees the safety of the drug as well, and we didn't have reports of ARIA in the study in front three.

Oh, that's great to hear.

So, you know, maybe if I can add one quick thing, you know, typically ARIA is observed in Alzheimer's disease and trials and it's associated with the removal of amyloid from the brain, especially from the vasculature. So, in the absence of amyloid or when it's not a prominent feature of the disease, I think the biological rationale for underlying the Ayurvedic physiology is not present. I just wanted to clarify this. So that's why it's not expected as a feature of this treatment, and we haven't observed it, you know, so far.

That's great to hear. Thank you very much. I appreciate you taking the question.

Sure. Thank you. Our next question comes from the line of Paul Matias of Stifel. Your line is now open.

Hi, this is Emily on for Paul. We were just wondering if there was a situation where you were able to hit on progranulin, but the clinical data was a bit more equivocal, how would you feel about your chances at approval in that situation? Thanks.

Sure.

Thanks for the question. The study in front three is enrolled 103 subjects with symptomatic FDD-GRN. We collect a number of clinical measures as well as biomarkers, and we will be, if the data is supported, we will be pursuing full approval. Based on the data, and given the fact that there are no approved treatments and the disease with a very huge burden, as Dr. Garbi reminded us just earlier, we will be open to have a dialogue with the regulatory authorities and the FDA based on the observed findings, which may include changes in progranulin. But again, we are meant to pursue full approval if the data supports it. And what we know from the CNS space, the FDA has recently approved drugs based on biomarker findings. If we think about the approval of Tofers, So there are regulatory precedents, especially in CNS diseases, which are rare and with no approved treatment options. But we are pursuing full approval if the data is supported.

Thanks. And then just one follow-up. Were you able, in that meeting, the FDA, to confirm alignment on the sample size again? Thank you.

Yeah, sure. Thanks for the question. So, we aligned on the sample size with the FDA in a meeting that we had in 2023, where we performed a blinded sample size re-estimation, and we observed the lower variability on the primary outcome measure, the CDR sum of boxes, FTLD, as we had in mind in our original powering assumptions. So we agreed with the FDA that a sample size between 90 and 100 subjects would be sufficient to show 40% slowing of disease progression in the active arm with latus enema versus placebo. And we got an agreement with them on the sample size, and we enrolled 103 subjects, so slightly over the number that we think is needed to show a clinical effect.

Thanks. Thank you.

Our next question comes from the line of Pete Stavropoulos of Kantor Fitzgerald. Your line is now open.

Hi, this is Samantha Schaffer on the line for Pete. Thanks so much for taking our question. So question for the team, Dr. Salvador, Dr. Darby related to Infront 3. We know that 16 asymptomatic patients were enrolled who will not be included in the primary analysis. Based on their baseline NFL levels, though, and what we know about natural history, do you expect signs of progression and potential differences between LATOSI and placebo within the 96 weeks? And then I just have a follow-up question. Thank you.

Sure.

Thanks for the question. So as you correctly said, the primary population is our patients who are symptomatic. So these 103 subjects that I just mentioned. Asymptomatic subjects, 16 of them were enrolled in the trial and will be part of sensitivity analysis. The study is ongoing and remains blinded, so I cannot comment on what we expect or what we, in terms of the ability to see an effect in pre-symptomatic subjects. We will definitely look at the data and part of the analysis and possibly entertain discussions with the regulators based on the data we observed. the results that we observe.

Just to add to this, the recruitment of the pre-symptomatic patients, as you said, based on genetic mutations of phototemporal dimension and certain threshold level of neurofilament, a sort of published study suggested that such patients could convert to symptomatic within the two-year period, but we will have to see what the actual data of the clinical trial, but That was the original expectations and the rationale for recruiting this group of pre-symptomatic with high level of neurofilaments.

That's very helpful. Thank you. And just to follow up, we know that there's a part two of the InFRONT study on an open label extension. Can you give us a sense, maybe quantitatively or qualitatively, how this part of the study is progressing? Is there a high rollover rate into the OLE?

So, we haven't disclosed details on how many subjects rolled over into the OLE. As a company, I can say that we are satisfied regarding the number of subjects who are are actually opting in to the open-level extension and we think they will provide meaningful data about the persistence of the benefit in terms of clinical endpoint and biomarkers as well as what happens in subjects who switch from placebo to active treatment moving to the open-level extension. There are some very interesting and meaningful presence in the CNS space about how these open-level extension data can provide more clarity on the meaningfulness of the results from the double-blind portion of the study. So we remain interested in looking at the results, but again, Statistical, I mean, the analysis will be focused on part one, which is the double blind portion of the study, 96 weeks. So we will not, you know, we will not focus on the open level extension for now.

Great. Thank you guys so much.

Thank you. I'm showing no further questions at this time. I would now like to turn it back to Neil Berkley for closing remarks.

Thank you. Before we end the conference call, I'd like to share that Elector will be participating in a number of upcoming conferences, including the 2025 Cantor Global Healthcare Conference on September 4th in New York, the Morgan Stanley 23rd Annual Global Healthcare Conference on September 8th in New York, and the H.C. Wainwright 27th Annual Global Investment Conference on September 9th in New York. Thank you again for your time and attention. We will now conclude today's call.

Thank you. This does conclude the program. You may now disconnect.