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spk_0: greetings and welcome to our tourist therapeutics fourth quarter twenty twenty two financial update and pipeline progress cause at this time all participants are analysts and only most a question and answer session will fall the formal presentation if anyone's require operator assistance during a conference this press start zero on your telephone keep it as a reminder this trump and his be recorded it is now my pleasure to introduce your host that is so far today vice president head of investor relations public relations and marketing thank you you may begin
spk_1: thank you afraid or a good afternoon and welcome to archer a circuitous fourth quarter twenty twenty two financial updates and pipeline progress call today's call will be led by joseph pain our president and ceo and and he says he or cfl doctor catch of a fool or see a so and ceo will join you for the queues any a session as well before we begin i would like to remind everyone that a statements made during this call regarding matters that are not historical facts are forward looking statements within the safe harbor provisions of the private securities litigation reform act of nineteen ninety five forward looking statements are not guaranteed of performance stay involved known and unknown risks uncertainties an assumption that may cause actual results performance and achievements to differ materially from don't express or implied by the statement please see the forward looking statements disclaimer on the company's press release issued earlier today as well as the risk factors section in or foreign ten case file with the fcc in addition any forward looking statements represent our views only as of to date such as statements are made arcturus specifically disclaims any obligation to update such a statement to reflect future information events or circumstances and without i will now trying to call over to joe
spk_2: a thank you never and good afternoon to all thank you for joining us for today's call the recent period has been characterized by substantial operational and pipeline progress here it arcturus we will be highlighting for areas on today's update call first we closed our strategic vaccine cool aberration agreement with csl secures at the end of last year we have received the two hundred million upfront payment and invoiced ninety million in additional milestones demonstrating the positive progress that the companies have made on her partnered covered and seasonal flu vaccine programs second we've entered into an agreement with major warm to evaluate your city one fifty four as a booster vaccine for sars cod to also known as coded nineteen and we're very happy to report significant operational progress in the ongoing phase three study in japan and will be providing an update their third we have continued to advance or on a platform technology and earlier stage clinical programs and we will provide an update on recent progress there force we have strengthened our management team by the addition of doctors juergen frolic as or chief medical officer over overseeing am marnie therapeutics and doctor igor small and off as are cheap development officer overseeing clinical development or vaccine franchise i'll begin with our recently announced strategic collaboration with csl we are in the initial phase of are now four month old collaboration and very pleased with how the teams are working together or actresses achieved substantial milestones this month associated with nominating next generation candidates for kovac and seasonal flu programs mutual respect as evident between the working groups of both companies there's a clear passion and solid work ethic behind the competent execution that is led to these important in early milestones being achieved we remain eligible for additional development and commercial milestones is covered pipeline programs advance our collaboration with csl is focused on the development and commercialization of next generation am or a vaccines targeting covert influenza three additional pathogens as well as pandemic preparedness our collaboration combines see a cells well established global vaccine commercial and manufacturing infrastructure with arcturus is am or in a manufacturing expertise and the innovative star m are in a vaccine and lunar delivery platform technologies we expect this collaboration to drive the development manufacture and global cook commercialization of next generation self amplifying am already vaccines over the coming years the impact of this collaboration to our balance sheet runway continues to be meaningful and and he will be speaking to that shortly now want our agreement with meiji farmer to advance a r c t one fifty four development in japan are contracted relationship with meiji is focused on developing a rct one fight for this is our next generation soap amplifying him or in a booster vaccine for covert nineteen you may already appreciate that japan has one of the world's highest rates of covert brewster vaccination given the japanese governments focus on public health and infectious disease perfect prevention we fully expect high levels of covert booster utilization for many years to come in addition ah the japanese government has been clear about their interest in establishing independence in a or any vaccines and we're very pleased to be part of this effort with me itchy but major group received a significant subsidy from the japanese government and the fourth quarter of twenty twenty two to support this effort and majors responsible for all development costs related to your city one fifty four in japan in december twenty twenty two we announced that meiji had initiated a p three booster study in japan designed to compare a rct one fifty four to commonality in targeting seven hundred and eighty adult participants based on non inferiority image in a city meiji moved quickly with the enrollment process very impressed and appreciative with the productivity and progress we've seen their i'm very pleased to report today that the study is now fully rolled with over eight hundred participants exceeding our target enrollment and ahead of schedule in addition the one month follow up visits and the one month blood draws have also been completed this time the execution allows us to immediately collect the prerequisite image in a city data and be in a position to potentially file our first and da in japan now moving to our earlier stage programs and i'll begin with a or ctp ten but this is our therapeutic candidate for order to transcribe am efficiency or old tc deficiency this investigation or therapeutic and to address be deficient o t c enzyme and the livers of individuals with this disease a or c th ten has the potential to restore your recycle activity and prevent metabolic crises that cause neurological damage and potentially liberalize strict dietary protein restrictions and improve the quality of life for people living with this condition the programs utilizes are proprietary lunar delivery tech technology and one important attribute of this technology is that the lip it's administered are rapidly degraded which we expect will contribute to a favorable safety profile we are evaluating a rcp eight ten and two ongoing clinical studies a phase one be study and adults and a multi dose space to study and adolescents and adults with ot see to piss the studies build upon a completed phase one study that demonstrated a favorable safety profile when toast up to a point for makes per kilogram the highest dose evaluated in that study we continue to advance a or city eight ten in the face to study the study one roll up to twenty four adolescents and adults living with ot see deficiency distributed across to dose cohorts the study has enrolled multiple subjects we remain on track to report a rct eight ten base to in term clinical data later this year now moving on to a rct oh thirty two this is our inhaled messenger arnie therapeutic candidate for cystic fibrosis a with this drug we are aiming to express fully functional cf to our protein in the lungs of individuals with cystic fibrosis our approaches agnostic to the underlying mutations associated associated with the disease and we believe that he or city oh thirty two could provide benefit across a very wide range of those living with cf especially type one cf and for individuals who are not well served by sea of tear up by see of to er modulators therapies we're grateful to have obtained support from the see a foundation for the advancement of this promising investigated for investigational medicine we also benefit from invaluable scientific collaboration with the experts at the see of the foundation previously we reported encouraging preclinical clinical that demonstrating successful delivery to the lungs and four different animal species mice rats spirits and primates notably our data have shown the ability to deliver him ornate to airway empathy or young in the see asked ferret this is a disease that produces significant mucus on the airways similar to patients with six yeah finally in vitro treatment of brock you'll epithelial cells from cf donors with a or city or thirty two has demonstrated robust expression of see to our protein and restoration of chloride current supported by these encouraging data we are now evaluating a r c t o thirty two at four different dose levels and a phase one study being conducted in new zealand we have successfully completed the enrollment of the first two cohorts with expectation to a complete enrollment up the entire thirty two subjects study and the second quarter of this year and plan to report study results later this year arcturus is excited to share our lunar h b b data next month the have been optimizing our in vivo intravenously dosed gene editing platform for years are preclinical gene editing am on a platform data for hepatitis b virus or be presented on april twenty seventh at the eighteenth annual global hepatitis summit conference in paris france this will be the first opportunity for the scientific community to evaluate the benefits of arcturus is lunar delivery of systemically administered am arnie or gene editing applications in this past quarter we have strengthened our management team we have brought on doctor juergen frolic to be our see em our chief medical officer to provide seasoned leadership over our am ornate therapeutics pipeline and also have brought on board doctor you for small enough to be our chief development officer who will lead arcturus his clinical development efforts for are promising coded and seasonal flu self amplifying am already backseat now doctor for of frolik has broad and successful experience in the field of rare diseases including o t c deficiency and cystic fibrosis he will assuredly increase our likelihood of success as arcturus initiate and navigates through late stage clinical trials for a rare disease therapeutic programs he has three decades of broad and late stage therapy clinical development experience a gym and tech quintiles be a mass ibsen vertex and june about juergen completed medical school at the universe he works bergen germany is a diplomat of the american board of clinical pharmacology and holds a dual executive m b a from zurich switzerland and the state university of new york and albany juergen has been directly involved in successful global marketing authorizations of drugs in the us canada the european union switzerland in australia since two thousand and eleven he's been involved in early and late stage of development of cf therapeutics including the approval of clyde ago and clinical development planning for other cf tr mart modulators the a seasoned experience and phase one two and three trials with inhale therapeutics of patience with cf to treat chronic lung infection we are fortunate to have doctor juergen frolic join our management team as or chief medical officer but now moving on to introduce aren't cheap development officer vaccines a doctor igor small and off as a strong record of successfully developing vaccines all the way through approval he will help our vaccine team and our partnership with csl get are cold and flu programs to this next level and we're excited about that a doctor small an officer recognized leader in clinical development with a proven record of accomplishment in biotech and large pharmaceutical companies he contributed to the successful development and licensure it's several of hit of vaccines before joining our tourists doctor small and off was the executive vice president at clover pharmaceuticals that's where he built a strong team that was able to rapidly generate pivotal clinical data leading to a cold entire team vaccine optimization and product launch their before that doctor small and off served as a therapeutic area had leading the development of several seasonal flu vaccines at csl secure us igor was the head of clinical development that madonna managing the initiation of the first clinical trials of messenger on a vaccines in humans and novartis vaccines doctor small enough contribute to contributed to the development and global licensure have multiple vaccines there as well igor graduated from volgograd state medical university and russia where he holds an md a phd and doctor science degrees from this university is the author of more than fifty publications and peer reviewed journals and clinical pharmacology infectious disease and vaccine development we are are indeed fortunate to have doctor igor small enough join our team here at our tourists as or cdr overseeing or vaccine franchise i will now passed the call on the and he says seen our c of o to provide financial updates
spk_3: thank you joe and good afternoon everyone the press release issued earlier today includes financial statement for the fourth quarter and fiscal year twenty twenty two and provides a summary an analysis of year over year and sequential financial performance please also reference or form ten k are more details on the financial performance i'll begin with the cfl agreement arcturus received a two hundred million dollars upfront payment that was received in the fourth quarter of twenty twenty two additionally in march twenty twenty three or truth achieved development milestone primarily associated with nominating next generation candidate for coven nineteen and seasonal flu programs resulting in ninety million dollars in voiced to csl we are excited to continue working on the program under the guidance and leadership of our partner cfl or csl collaboration of the forty six the profit sharing agreement little lady the coven nineteen vaccine products with respect to program costs related to the by veil and coven nineteen vaccine we expect that future anticipated milestone will cover all related expenses going forward additionally the program cost for the seasonal flu candidate will be reimbursed in full on an ongoing basis the it's own can apply at thirty seven and a half million on d credit to be used within the next five years against cost incurred on the flu and three other respiratory disease back the and as you heard earlier we are excited that meiji completed and roman during the first quarter of twenty twenty three for the faith three covert nineteen booster trial of the rct one fifty four in japan maybe it was possible for all related clinical regulatory development and manufacturing expensive for the a rct one fifty four booster vaccine our manufacturing loan with the singapore government which had a principal and interest balance of fifty point four million as of december thirty first twenty twenty two with renegotiated in march twenty twenty three which resulted in arcturus paying back seventeen point one million and the remaining thirty three point three million being forgiven as a result actors had no further alone obligations payable to singapore
spk_2: on the treasury side in march twenty twenty three we paid off the remaining loan with western alliance bank which had a balance of ten million dollars as of december thirty first twenty twenty two and we entered into a new banking relationship with wells fargo
spk_3: based on the substantial funding provided by the cfl collaboration we expect doctors to be in a very strong financial position in the next few years our cash runaway now extend to the beginning of twenty twenty thick based on our current pipeline and assuming no milestones or revenues from any commercial products sale i will now provide a quick summary over financial results for the fourth quarter of twenty twenty two we reported revenue of a hundred and sixty point three million for the fourth quarter compared to revenue the five point eight million in the fourth quarter of twenty twenty one the increase in revenue is predominantly driven by the life and portion of the upfront payment from the cfl transaction we reported total operating expenses of thirty eight point eight million during the fourth quarter of twenty twenty two computer operating expenses the forty three point four million in the fourth quarter of twenty one the decline in operating expenses with primarily due to lower coven nineteen related manufacturing and clinical related expenses finally we reported in net income of approximately one hundred and seventeen point three million with four dollar than forty two cents per diluted share during the fourth quarter of twenty twenty two compared to a net loss of thirty eight point seven million or one dollar and forty seven cents per diluted share
spk_4: during the fourth quarter of twenty twenty one
spk_3: i am happy to report for the first time in the history of the company we reported net income and nine point three million for the fiscal you and twenty twenty two in summary we believe that the company is a strong financial position and had the resources needed to achieve multiple near term value creating milestone but the vaccine and therapeutic program over the next twelve months i will now passed a call back to joe
spk_2: a fake sandy it's been a productive quarter we have the ground running with csl as indicated by meaningful early milestones being achieved in the partnership we made measurable progress in each of our clinical programs which has put us in a position to potentially file our first nd a in japan and collect meaningful clinical data and twenty twenty three for each one of our pipeline programs this will showcase the intra muscular intravenous and inhaled applications of a proprietary or any and delivery technologies and we've also strengthen our management team and look forward to many of you meeting them ah over the next to the remainder of the year so with that we would like to turn the time over to the operator questions
spk_0: thank you ladies and gentlemen it is time will be conducting question and answer session if you like a question you may press one on your telephone keep had a confirmation tunnel and to your line is in question do you may press start to if you like to remove your question from the que more important of engine speaker equipment you may be necessary to pick up your handset before pessimists nike first question comes from line of name is fernandez with guggenheim least he would your question
spk_5: ah thanks for the question so on my first question is actually on that may be a trial or someplace that he married men a lot of progress and rolling patient and we're almost on the cost of actually getting the clinical data i'm hoping that the team could comment on what your home for a vacation bar for those data relative newcomer naughty ah i'm and if there will be follow up tina on because i believe that there had been in the past some suggestion of greater durability with the self amplifying are in a
spk_6: and as a potential advantage over the just justin standard modified a minute
spk_5: and then a second question i just really wanted to get a better sam if you are willing to share the dosing regimen i'm in a little bit more detail i am a number of patients that have been done so far india in the ot see study think the much
spk_2: a take seamus well with respect your first question the primary objective of that trial is is is to establish non inferiority with respect to the him indigenous the data it one of the key sets of him to the city data is that one month blood data that's been withdrawn already so you're you're correct and your assessment that works collecting data as we speak bad it's very relevant to the the the the upcoming potential new drug application in japan so we want to make sure that that a minute image in a city that is included in that application with respect your durability and france yes i did it and no doubt we will be tracking that in parallel but that durability data is not a prerequisite to establishing approval with the pm to a approval in in japan it'll be an ad on and just strengthen our commercial business case if we're fortunate to get commercialized this year yeah and and then the with respect to the second question ah all we have indicated on guy that there with respect to ltc is that weeks for the first time we've we've been formed it's a we've communicated externally that we have now and ruled multiple patients we cannot give any more specific than that and then with respect to guidance we want to make clear that we're still on track for sharing face to data later this year
spk_5: nope you know my can i just clarify and hold patients or have you started dancing patients efficiently
spk_2: yes ruled means a i define as dosing cracked so whenever i mention the word omit in this context that's past screening they up and dose crap
spk_7: okay great thank you
spk_8: still is done one other point is that not as good at even in the early the first don't think there will be i expected some pharmacological accurately because it is ah it is a dose level where we see some cortical at that preclinical models
spk_0: our next question comes on a line of an interview with wells fargo prefer she was your question
spk_9: a great thanks for taking the questions and congrats on the progress and on a few questions and and egypt japan coded study and could you talk about the yeah what might be the know if you're rg margin
spk_10: for the primary
spk_11: analysis
spk_9: and
spk_12: have you talked about the potential economics from a japanese
spk_2: redwood tree approval thanks ah wolf
spk_3: at i want to make sure i understand your question with respect to the that that just a phase three trial in japan i know that it's been properly powered to achieve statistical relevance friends with with respect to nine inferior and point so there's no concerns there with respect to the margins required
spk_9: numerical superiority will obviously be observed but statistical superiority or or will have to collect the data does to understand that with respect to your second question which was on i to pass it along to and yeah no thank you for the question unfortunately we don't you know provide guidance with respect to economics and when when we do have that in all available we will share with the market what the economic far for you know yeah tell me g and are so are going forward so thanks for the question got it and then
spk_2: a top of question i would you see deficiency in terms of from have later this year you mentioned a subset of patience amp would we see one or both cohorts update her and also what would define success for us to meet out sure so that it at that the successes biological proof of concept and that's being defined by biomarker changes being observed in this patient population so the biomarkers include ammonia an erotic acid a jury of ammonia in the blood erotic acid in the year and urea regenesis will be being will be measured at other amino acids will be also measured for and the ot cmc enzyme itself will be measured in in in the blood through i on validated a so are several biomarkers will be measured and and so when we indicate biological proof of concept we mean being able to measure or determine changes in those biomarkers because of the the therapeutic
spk_9: well with respect to what was the other question because that and would would we see one or both course of patients wow
spk_13: is that that depends on the rate of enrollment added that or recruiting up to twenty four subjects in this trial and twelve of them are at one particular dose and twelve or at another dose and it is placebo controlled sorts ninety three the three to one a racially to those court so if the rate of enrollment exceeds twelve and yes will be able to
spk_2: provide those observations upgrade and the lastly on the cystic fibrosis program which data later this year just wandering outlet for this the healthy volunteers study what would be the most meaningful read out that we should watch out for and how do you determine a those to be used in cystic fibrosis patients off doors and que
spk_8: right so did this is it the most meaningful exercise here with these for doses being evaluated in these early subjects and phase one is just ascertaining safety and tolerability of the dosing regimen itself this isn't inhaled therapeutic so we're going to be able to quickly evaluate the maximum taller
spk_9: rated dosing for example the how long can a person him hailed as therapeutic for
spk_2: and so that will be them the most interesting data the out
spk_0: he added add and ass you know be based on our phase one data obviously we'll be looking at the lowest dose also and the top dogs and my we decided when we going to face to begin follow my eliminate some of the lower doses and will pick up those where we feel comfortable with that as a good safety margin to start with
spk_14: great they're helpful thank you thanks you or next question comes on the line of evolve noch amol gets with city please issue with your question
spk_2: again this is awesome mubarak's on bring all thanks for taking my questions on the o t c programming some earlier comments on a girl that and how that's going on coupon at all on the rate of enrollment and particular site activation in if there are still outstanding challenges their or spur was a moralist haven't solved and in terms of the odyssey data itself you're planning on sharing the new common at all in your expectations sports fanatics of response meaning is and how long you the gates a dose and the spaces before it uniting enough response data to be meaningful enough to share acts sure so at at it i can update the market that we have now on board it nine active sites for o t c deficiency and the bulk of that effort was last year this is the year where with and initiated a walk in rome it officially so at it with respect to the piece of enrollment as it it's nothing that is out of the ordinary for rare liver disease europe
spk_15: so that's only comment i can provide there are always disclosed his multiple pieces being rolled so far with respect to the kinetics it's helpful to understand that this is a six administration trial so these doses are separated by two weeks so there's six administration's
spk_8: and our what we've seen pre clinically is that ot see as additive and our preclinical animal studies so we may see this in humans as well so that with respect to kinetics it's a oh wait we are collecting blood draws after
spk_16: each administration over these half a dozen
spk_8: doses
spk_14: again that is add to point out that you know where the first protean replacement therapeutic that going after the syndication and as as a specifically for about a replacement using a marinade so there's lot of us unpaved road that were were trying to tackle but we envision of course that we could see something in the first few dose and us if we do because of that we are measuring not are you know a handful a biomarker so will be up the where we see something where zone and will report on them
spk_2: got it is very helpful and going to ask one more on the cystic fibrosis program ah you think it's possible we could get some initial help him wanted dana discount or years not even that more likely to be a twenty twenty four event and maybe want to have been data and hand how are we didn't you can can run into are treating pan shooting actual cystic fibrosis patients thanks the other the study's being conducted in new zealand the face wednesday for cf
spk_14: because we've already dose toasted a pair of cohorts there there may be some initial feedback from
spk_0: and we haven't had any six serious or severe adverse events
spk_17: it was after report on that still after the the first survey after the first couple cohorts it does present the potential opportunity to amend phase one to add see of patients the whether we add see of patience to the phase one trial itself or quickly pivot to have a more traditional face two regulatory processes is yet to be determined communicated
spk_2: more humble thanks know much thanks our next question comes on the line of pete never populace with cantor fitzgerald please your question hello joe ending theme ah thank you for taking my question are questions and so yeah i have one on on a ten the o t c or deficiency program you know what type of patients are are you in rolling on be to their baseline characteristics in our are you are you twenty one rule pieces that are stable unstable love back on meds and dumb and are the controlled uncontrolled and done can you speculate you know in which type of patients you may be able to see the most pronounced the back and
spk_17: yeah these are stable adult and adolescents subjects
spk_18: said that that will be the initial focus so both adults and adolescence and in the european face to multiple sending dose trial
spk_17: second comment on that with respect to the other and what was the other aspect of your question for you speculate on which applications you actually see the most pronounced that oh okay with is that why think that this therapeutic as the opportunity to have a biological impact on every patient injected however if they
spk_2: are already on ammonia scavengers for example the other biomarkers will be more meaningful like urea genesis and ot see itself but if if they are not on ammonia scavengers and of course ammonia will be looked at erotic acid another amino acids are going to be investigated on so that the collector body of data should be sufficient it turned out to negotiate the regulatory a path efficiently with regulatory agencies and these with i'm sorry go ahead no that's it did you know your question yeah i have a license so you know if you become sense of how many subjects have gone through other bulldozing cycle or interface to match study and you know are you allah is really got a safety look built in by with a and be i yeah there's always safety check points but
spk_17: in a we've already got approval to proceed in a multiple send those first six administration's right it always communicate is multiple subjects but if every two weeks there's another administration so you can make your assumptions based on that the hill there's a road subjects that
spk_2: if the continued on in the study of course they would have are multiple administration's over and moving into a zero three to and also can gradually that of congratulations on that you know the roman seems to be gone well but i'm i'm did have a i know you briefly mentioned preclinical data are you prepared remarks but you know if you can go to little bit more detail perhaps pad i in a weapon preclinical data would have an answer conviction to move into or the human studies and the are specifically you know keep discuss the predictive value of the the ferry model and the you know how field typically similar is a to see ephesians you know the recapitulate human disease in the lungs and down it has been validated through other therapeutic agents yeah the see a ferret model is relatively new it's an exciting not all that the see a foundation and many others are recommending companies to to you utilize because of it it's very likely more representative of the human condition because of that mucus that's generated in the lungs in the see a fair amount of the the keep so so it's difficult to speculator confirm that this is a validated predictive model but i think he did it is very large your for to suggest that it's more representative of the human condition because of the additional mucus in the lungs i think that's is a safe assumption i would like to the do just point out that our approach is it has been different from previous approaches that we properly modify and and also purify or message journey molecule utilizing the arcturus is tech a proprietary technology or this is the first time and inhaled message on a therapy it for cf has entered the clinic where you're utilizing the lunar technology the
spk_19: is this technology has been highly optimized for bra fuel it feel yourself delivery and i've been optimized to survive the the mucus environment and optimized for inflation and aerosolized a shit
spk_2: processes
spk_0: can't and then finally in a week we also note that this is also been uniquely optimized the see if the are construct itself to increase of functional activity so there's a lot of differences in this therapeutic than than what's been tried before so that when we look at this c f ferret model as indicative of a
spk_2: three meaningful because we just don't see a lot of
spk_20: the
spk_2: folks are companies are therapeutics are being showcased in the specific model so i think it could potentially very me thank you for take my questions yes thank you be
spk_0: that is all the time we have her questions at this time i'd like to hang a call back teachers of pain for closing remarks
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