Arrowhead Pharmaceuticals, Inc.

Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call. Throughout today's recorded presentation, all participants will be in a listen-only mode. After the presentation, there will be an opportunity to ask questions. I will now hand the conference over to, one moment, I will now hand the conference over to Vincent Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.

Thank you. Good afternoon, everyone. And thank you for joining us today to discuss Arrowhead's results for its fiscal 2023 second quarter, ended March 31st, 2023. With us today from management, our president and CEO, Dr. Christopher Anzalone, who will provide an overview of the quarter. Dr. Javier San Martin, our chief medical officer, who will provide an update on our mid and later stage clinical pipeline. Dr. James Hamilton, our chief of discovery and translational medicine. who will provide an update on our earlier stage programs, and Ken Miszkowski, our Chief Financial Officer, who will give a review of the financials. In addition, Tracy Oliver, our Chief Commercial Officer, and Patrick O'Brien, our Chief Operating Officer and General Counsel, will be available during the Q&A portion of the call. Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact are forward-looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statements. For further details concerning these risks and uncertainties, please refer to our SEC filings, including our most recent annual report on Form 10-K and our quarterly reports on Form 10-Q. I'd now like to turn the call over to Chris Anzalone, President and CEO of the company. Chris?

Thanks, Vince. Good afternoon, everyone, and thank you for joining us today. In 2017, we introduced our proprietary TRIM platform. We believed then that it could become an industry-leading RNAi platform for hepatocyte-focused therapies, and importantly, one that could bring RNAi outside the liver. This was based entirely on our confidence in the potential of the science. and our stock was trading for less than $2. Six years later, we have 12 individual drug candidates in clinical studies targeting two different organ systems, three ongoing phase three studies, five strong partners, a healthy balance sheet, and reason to believe that the next six years will be characterized by even more rapid growth. We expect to have at least 14 drug candidates in clinical trials by the end of this year targeting three different organ systems, liver, lung, and CNS. Skeletal muscle targeting programs could grow this to 16 individual drug candidates across four different organ systems in 2023, but partnering opportunities make that a bit more difficult to predict, and I will touch on that later in the call. We are well on our way to reach our 20 and 25 goal to grow our pipeline of RNAi therapeutics to a total of 20 clinical stage or marketed products in the year 2025. I do not believe there is a company on the planet that can match this. We've made substantial progress over the past quarter and since our last call. Let's start with pulmonary. We recently disclosed early top-line data for arrow rage in normal, healthy volunteers. The data were very encouraging and indicated a high level of target gene knockdown with a long duration of effect in a well-tolerated manner. James will talk about these data in a moment, but I want to put this into context. I believe that Arrowhead is the first company to ever show RNAi-mediated target gene knockdown in the lung. Even more impressive was the magnitude of response. We didn't just get on the board. We saw up to 90% knockdown in serum after just two inhaled doses at the fourth of fifth of five planned doses. We do not yet have data from the highest single or multiple dose cohorts. It appears that the pulmonary platform is doing what it was designed to do, and arrow rage appears to be highly potent. I expect the durability to enable monthly or less frequent dosing. We've often said that clinical validation of the lung platform could mark the beginning of a second rapid wave of growth for our company. Cells don't care what the sequence of an RNAi drug is. Once we find that reducing expression of a specific target gene can be done in a well-tolerated manner, we have a high degree of confidence we can replicate it with any number of new gene targets, much as we have done in the liver. That is where we may be with the pulmonary franchise. I think the data we reported and the additional data we expect to present at the R&D day on June 1st represent the initial clinical validation we were hoping for. This is a big deal. I fully expect that in the near to midterm, we will have several potentially important new drug candidates targeting the lung that could address grinding unmet medical needs. Aromux 5AC will be our next pulmonary data set, and I expect that we will have some normal healthy volunteer data by the R&D day. These two programs continue to move forward and have both progressed into Part 2 of the Phase 1-2 studies where asthma patients are treated. We hope to have some data from the patient portion of these studies by the end of the year. Rounding out our current pulmonary pipeline is Arrow MMP7. In the last quarter, we initiated a Phase 1-2 study for the treatment of idiopathic pulmonary fibrosis, and we are currently dosing normal healthy volunteers. Where do we go next? The central nervous system. There are a number of untreatable and poorly treated CNS conditions and many genes that could serve as powerful targets for RNAi therapeutics. We have spent a substantial amount of time developing a CNS-focused TRMM platform and are just about ready to bring our first drug candidate to the clinic. As we announced a couple weeks back, AROSOD1 is our first CNS-targeted drug candidate to be nominated. It will be investigated as a potential treatment for patients with ALS caused by SOD1 mutations. We have already completed disease model work and CTA-enabling toxicology studies and are now on track to file a CTA next quarter. You will hear more about the platform and the candidates at the June 1st Analyst Day, and we see these as powerful tools for a new set of patients we seek to serve. Importantly, as with liver, pulmonary, and skeletal muscle delivery, we expect to follow AROSOD1 with several additional drug candidates. In addition, we have made impressive progress on different modes of administration, and while we are not quite there yet, we believe we are approaching the day where we may administer RNAi CNS drug candidates systemically to cross the blood-brain barrier. This would be a truly disruptive leap forward, and our data suggests that we are close. We look forward to discussing this as well at the analyst day. We have said in the past that we are committed to bringing RNAi to where unmet medical need is, and this means constantly expanding trim. We believe we can address a new cell type every 18 to 24 months, and while our CNS franchise meets this, it is not the only new organ system we are exploring. I believe we can now also deliver to adipose tissue and have demonstrated in non-human primates target gene silencing of greater than 90% with over six months of duration after a single subcutaneous injection using what we believe are clinically relevant dose levels. Adipose tissue is the largest endocrine organ in the body, and we believe there are many targets to address and many potential patients to help. You will hear more about this new platform next month at the analyst day. Let's now turn to our more established clinical programs. We've shared some early data from the Phase 1-2 study of ARROW-C3 for complement-mediated diseases, and they are compelling. We are seeing deep and durable knockdown in healthy volunteers and have progressed to the patient portion of the study. We also shared liver fat data that Janssen generated in a phase one, two study of arrow PNPLA3 for NASH in patients with PNPLA3 mutations. Those two were quite encouraging and demonstrated deep reductions in liver fat after only a single dose of arrow PNPLA3. We plan to move that into a multi-dose phase two study in NASH patients late this year. Moving on to our later stage pipeline, we continue to enroll patients in the phase three Palisade study of AeroApoC3 in patients with familial chylomicronemia syndrome, or FCS, and expect to meet our enrollment goal of 72 patients tomorrow. There are also some additional patients that have passed screening and who will likely be randomized over the next two weeks. At that point, enrollment will be complete, and I suspect that we will have closer to 80 patients in the study. We also received fast track designation from the FDA, for AeroApoC3 for reducing triglycerides in adult patients with FCS, which will be helpful as we advance the program rapidly. Javier will talk about this in a moment, but I expect this to be our first drug to complete a phase three study, and if efficacy and safety are established, could be the first NDA that we file. This could be next year, and it would represent an important step for us. Of course, that is not the only population of patients we intend to treat with AeroApoC3. Rather, I expect us to take steps toward pivotal studies in patients with severe hypercholesterolemia and those with mixed dyslipidemia later this year. The AROANGE-3 Phase II study in mixed dyslipidemia patients is complete, as is the Phase II study in patients with homozygous familial hypercholesterolemia, or HOFH. I expect that both of these will move toward Phase III studies later this year. Both AeroAng3 and AeroApoC3 appear to be potentially powerful drug candidates. We have included nearly 900 patients in the basket of Phase II and Phase III studies of AeroAng3 and AeroApoC3 over the past couple of years and continue to be encouraged by the drug candidates' activity and safety profiles. I believe that both of these will ultimately be important drugs for many patients. Also during the quarter, we announced that our partner, Takeda, had treated the first patient in the Phase III Redwood study of Azirciran being investigated as a potential treatment for alpha-1 antitrypsin deficiency liver disease. This is the third TRIM-enabled candidate to reach a Phase III setting, which earned Arrowhead a $40 million milestone payment. We also received a $30 million milestone payment from GSK after the start of GSK's Phase IIb trial of GSK4532990, formerly called ArrowHSD, an investigational RNAi therapeutic for the treatment of patients with NASH. These milestone payments are helpful for our balance sheet, but also represent two more important things. First, they are a confirmation that our strategy to have a healthy mix of both wholly owned and partner programs is playing out as intended. And second, they indicate that important new medicines that Arrowhead discovered are getting closer to the patients who need them. Before I hand off to Javier, let me say a few words about the Skeletal Muscle Franchise and Dux4, I'm sorry, and Arrow Dux4 specifically. We completed everything required for a CTA, including regulatory filing preparation, acute and even chronic GLP toxicology studies. We are prepared to file the CTA and begin a Phase I and II study, but several companies have expressed interest in potentially partnering on the development of AeroDux4 and potentially our next skeletal muscle targeted drug candidate that will be CTA ready in Q4. As such, we paused filing while we explore these options. course I do not know if any of these will translate into license agreements and partnerships but I expect we will either complete a deal or move forward with the arrow ducks for clinical program over the next couple of months arrowhead is executed at a very high level our platform is expanding into new areas our early pipeline is generating impressive results our mid and later stage pipeline are giving us line of sight to when continue to bear fruit. With that overview, I'd now like to turn the call over to Dr. Javier San Marquis. Javier?

Thank you, Chris, and good afternoon, everyone. Before I go into the mid- and late-stage cardiometabolic studies, I want to quickly review the status of defacuciran, our investigation RNAi therapeutic being developed in partnership with Takeda for the treatment of liver disease associated with Alpha-1 antidepressant deficiency. During the last quarter, we reported data demonstrating that patients receiving 25, 100, or 200 milligrams of vasircidin who had baseline fibrosis achieved a dose-dependent mean reduction in serum ZAAT concentration at week 48 of 74%, 89%, and 94% respectively, leading to dramatic reductions in total liver ZAAT and past the global burden, a histological measure of ZAAT accumulation. In addition, 42% of patients showed an improvement in portal inflammation, and 50% of patients achieved an improvement in fibrosis of at least one point by Metavir stage. These data were very consistent with the prior data generated from the 2002 open-label study. Subsequently, Takeda initiated and began dosing in the Redwood clinical study. It is a randomized double-blind placebo-controlled phase three trial to evaluate the efficacy and safety of facilcidin in the treatment of AATD liver disease. Approximately 160 adult patients with meta-VIR stage F2 to F4 fibrosis will be randomized one-to-one to receive facilcidin or placebo. The primary endpoint of the study is a decrease from baseline of at least one stage of histological fibrosis meta-VIR staging in the centrally rare liver biopsy than at week 106 in patients with Metavir stage F2 and F3 fibrosis. Additional information on the Redwood study can be found at www.theredwoodliverstudy.com. I also want to give a brief update on where we are with our cardiometabolic candidates, ARO-ApoC-3 and ARO-H2. I will start with ARO-ApoC-3, our investigation on RNAi therapeutic being developed as a treatment for patients with mixed dyslipidemia, severe hypertriglyceridemia, and FCS. The SHASTA II Phase II study in 229 patients with severe hypertriglyceridemia and the MIIR Phase II study in 353 patients with mixed dyslipidemia are both on schedule for data readout later this year. This data will enable us to request NO Phase II meeting with regulators to discuss and get feedback on our plans for Phase III studies. Phase III study in 72 patients with FCS is ongoing. We have enrolled 70 of the planned 72 patients, and we believe we will reach planned enrollment tomorrow. This is a 48-week study with primary endpoint of percent change from baseline in fasting triglycerides. This put us on schedule for study completion in Q2 of 2024. a data readout shortly after that, and then NDA preparation. I'm also pleased to announce that during last quarter, AeroApoC-3 was granted fast drug designation by the US FDA for reducing triglycerides in adult patients with FCS. AeroApoC-3 was previously granted orphan drug designation by the FDA and the European Union for the same indication. PASS-TRACK is a process designed to expedite the development and review of drugs to treat serious or life-threatening conditions and fulfill an unmet medical need. The purpose is to get important new drugs to patients earlier. This designation makes Arrowhead eligible for multiple potential benefits, including more frequent interaction with the FDA, eligibility for priority review, and eligibility for rolling review of the NDA. Once we have complete data from the Phase III palliative study in 2024, we intend to utilize all available mechanisms to get this potentially important drug to patients as quickly as possible. This will be the first Phase III readout of Arrowhead and our pipeline of RNAi therapeutics that utilize our proprietary III platform. That represents a significant milestone for the company. Moving on to the second wholly-owned cardiometabolic candidate, ARO-H3, which is our investigational RNA isotherapeutic being developed as a treatment for homozygous familial hypercholesterolemia, or HOFH, and heterozygous familial hypercholesterolemia, or HEFH. We have completed the ARC-II Phase II study in 204 patients with mixed dyslipidemia, and we're currently in the process of generating and analyzing study data which we intend to report on later this year. The second phase two study for R80N3 is the GATEWAY study in 18 patients with HOFH. This study is an open-label and was fully enrolled previously. I'm happy to report that the LDL reduction in this difficult-to-treat population with limited treatment options appear to be competitive with evinocumab, a monoclonal antibody that targets the same HPTL3 protein which is currently approved for HOFH patients. We will present interim data from the GATEWAY study at the 91st European Arteriosclerosis Society Congress on May 23rd. These were welcome results, and thus we're currently working on the Phase III study design and plan for HOH-3 in HOFH. We will also talk in more detail about the unmet need in cardiovascular disease, the results from our cardiometabolic programs, our clinical development plans, and our commercial strategy at the upcoming R&D day in June. I will now turn the call over to Dr. James Hamilton. James.

Thank you, Javier. We have demonstrated significant progress across discovery and early development. We continue to extend the reach of our TRIMM platform to new tissue types and expand our pipeline into new disease areas in which patients have inadequate treatment options. We've also rapidly and efficiently advanced multiple early clinical stage programs and continue to generate highly encouraging data using various versions of the TRIMM platform, each optimized for a different cell type. I'd like to focus today on a few different areas. The pulmonary platform with recent top line data announced for AeroRage, AeroC3, our candidate for complement mediated diseases, and our emerging CNS platform, with the first candidate being arrow SAD1. Let's start with pulmonary. We have three candidates in the clinic now, arrow RAGE, arrow MUC5AC, and arrow MMP7, which all use the same trim conjugate that targets the alpha V beta 6 integrin for delivery to pulmonary epithelial cells. I will talk about each individually, but we think one of the benefits of gaining an RNAi therapeutic delivery platform with increasing validation is that learnings from each platform program can directly inform advances in the others. So we view de-risking events for one program, such as the data we saw with AeroRage, as potentially de-risking to some extent to the others. AeroRage is our investigational RNAi therapeutic designed to reduce expression of the receptor for advanced glycation end products, or RAGE, as a potential treatment for inflammatory pulmonary diseases such as asthma. We are currently conducting a phase one, two-way randomized double-blinded placebo-controlled study in normal healthy volunteers, which is part one, and in patients with mild to moderate asthma, which is part two. The single ascending dose portion of the study includes five sequentially enrolled NHB cohorts with escalating single dose levels. The multiple ascending dose portion of the study includes five NHB cohorts and three asthma patient cohorts. We've fully enrolled and dosed all SAD cohorts, and the final MAG cohort is anticipated to be fully enrolled in the coming weeks. We've also opened the patient cohorts with enrollment of the first cohort nearly complete. We reported very encouraging top-line results from four of the five SAD and MAD cohorts and NHBs. We do not yet have data from the fifth and highest dose level, but we plan to report those results when they are available later this year. First, safety and tolerability assessments have been encouraging. Overall, there were no patterns of adverse changes in any clinical safety parameters, no reported serious or severe adverse events, and no dropouts related to drug or related to adverse events. In addition to safety and tolerability, arrow rage demonstrated a strong pharmacodynamic effect. The mean maximum reduction in soluble rage, or S-rage, at the 92 milligram dose as measured in serum after two doses on day one and day 29 was 80%, with a maximum reduction of 90%. The lower doses of 10, 20, and 44 milligrams also showed a dose response ranging from 31% to 59%. Serum Esrage was also reduced after a single dose with a mean maximum reduction at the 92 milligram dose of 56% and a maximum reduction of 68%. Reductions in Esrage as measured in bronchoaviola lavage fluid on day 31 after a single dose were also observed with a mean reduction at 92 milligrams of 75% and a maximum reduction of 92%. We have additional planned cohorts in which valve will be collected at later time points to quantify the additional lung level knockdown after two doses. Lastly, the duration of pharmacologic effect persisted for at least six weeks after the second administration of the 92 milligram dose. This is the last time point currently available, and additional follow-up is ongoing. This suggests that monthly, bimonthly, or less frequent dosing may be possible with arrow rage. All in all, we believe these data show good translation of preclinical results to humans. Moving on to arrow MUC5AC, our investigational RNAi therapeutic designed to reduce production of mucin 5AC or MUC5AC as a potential treatment for various mucobstructive pulmonary diseases. We are currently conducting a Phase I-IIa study similar in design to the AeroRage study, and we have begun enrollment of the asthma patient cohorts. Sample processing and analysis for the NHP cohorts is ongoing, and we intend to report on initial data when available. The third pulmonary program in the clinic is AeroMMP7, which is designed to reduce expression of matrix metalloproteinase 7 or MMP7 as a potential treatment for idiopathic pulmonary fibrosis, or IPF. During the last quarter, we initiated a phase 1, 2A single ascending dose and multiple ascending dose study to evaluate the safety, tolerability, pharmacokinetics, and pharmacodynamics of arrow MMP7 in healthy volunteers and in patients with IPF. Dose escalation in this study is ongoing. Now let's discuss initial results with arrow C3, our investigational RNAi therapeutic targeting hepatic C3 expression as a potential treatment for complement-mediated hematologic and renal diseases. Substantial unmet medical need remains in the treatment of multiple complement-mediated diseases, including IgA nephropathy, C3 glomerulopathy, and additional renal and hematologic indications. We are conducting a phase 1-2 placebo-controlled dose-escalating study to evaluate the safety, tolerability, pharmacokinetics, and pharmacodynamics of AeroC3 in adult healthy volunteers and patients with complement-mediated renal disease. We originally planned to also include patients with P and H in the study, but we have since decided to eliminate these cohorts. We may decide to study P and H patients in the future, but we believe we can generate the data we need in the other populations. During the quarter, we reported top-line interim data and presented additional data at the seventh complement UK training course and symposium in April. In part one of the study in NHVs, AeroC3 demonstrated a dose-dependent reduction in Serum C3 with 88% mean reduction after two doses of the highest dose tested. A dose-dependent reduction in AH50 a marker of alternative complement pathway hemolytic activity, was also observed with a 91% mean reduction at the highest dose tested. Seroc3 had a long duration of pharmacologic effect, and we think this suggests quarterly or less frequent subcutaneous dose administration is possible. Lastly, I'd like to briefly mention our announcement that CNS is the next area of focus in the TRMM platform. We've been working on CNS delivery for some time, but have not discussed these efforts publicly until now. Our TRMM platform now includes a construct optimized for intrathecal administration to the central nervous system with good distribution throughout the brain and in all relevant brain cell types. AeroSOD1, the first program to use this new delivery platform, is designed to reduce expression of superoxide dismutase 1, or SOD1, and the CNS as a potential treatment for patients with amyotrophic lateral sclerosis, or ALS, caused by SOD1 mutations. ARASOD1 was highly active against its target with a long duration of effect in multiple preclinical models that we believe suggest it may be administered quarterly or less frequently. In preclinical studies, AROSOD1 achieved 95% spinal cord tissue mRNA knockdown after a single intrathecal dose in SOD1 transgenic rats and maintained greater than 80% spinal cord tissue mRNA knockdown three months after a single intrathecal dose in nonhuman primates. AROSOD1 is on track for a CTA filing in the third quarter of 2023. We will talk more about our CNS platform and about ERO-SOD-1 at the R&D day in June, but I wanted to introduce the program because we were very excited about the potential for S-IRA in the CNS. I will now turn the call over to Ken Miszkowski. Ken?

Thank you, James, and good afternoon, everyone. As we reported today, our net income for the quarter ended March 31, 2023. It was $48.7 million, or 45 cents per share, based on $108.1 million fully diluted weighted average shares outstanding. This compares with net income of 44.4 million or 41 cents per share based on 107.9 million fully diluted weighted average shares outstanding for the quarter ended March 31st, 2022. Revenue for the quarter ended March 31st, 2023 was 146.3 million compared to 151.8 million for the quarter ended March 31st, 2022. Revenue in the current period primarily relates to our collaboration agreements with Takeda and GSK. Revenue is recognized as we complete our performance obligations, which include managing the ongoing AAT phase two clinical trials for Takeda. There remains 31 million of revenue to be recognized associated with the Takeda collaboration, which we anticipate will be recognized over the next year. Additionally, in the quarter, Ended March 31, 2023, Takeda dosed the first patient of its Phase III Redwood clinical study of Vizisarin, triggering a $40 million milestone payment. And GSK dosed the first patient in its Phase IIb trial of GSK453-2990, formerly known as AeroHSD, in March, triggering a $30 million milestone payment. Revenue for these milestone payments will be reflected in fiscal, q2 while cash receipt will be in fiscal q3 revenue in the prior period primarily related to the recognition of 120 million dollars associated with the upfront payment received from gfk in addition to a portion of the payments received from our license and collaboration agreements with cicada and horizon total operating expenses for the quarter ended march 31st 2023 were 98.1 million compared to $110.3 million for the quarter ended March 31, 2022. The key driver of this change was decreased candidate costs and lower stock compensation expense. The decreased candidate costs were primarily due to the reduction in outsourced manufacturing and toxicity study costs relating to our cardiometabolic studies as the company's pipeline of candidates progressed through clinical trials in 2022. Net cash used by operating activities during the quarter ended March 31st, 2023 was 107.2 million, compared with net cash provided by operating activities of 1.4 million for the quarter ended March 31st, 2022. Prior period includes $120 million cash inflow from GSK, from the GSK Licensing and Collaboration Agreement. We expect our operating cash burn to be at the lower range of $70 to $90 million per quarter in fiscal 2023. We expect capital expenditures of approximately $90 million in the second half of fiscal 2023 as we near completion of our footprint expansion projects, including GMP manufacturing. Turning to our balance sheet, Our cash and investments totaled $559.8 million at March 31, 2023, compared to $482.3 million at September 30, 2022. The increase in our cash and investments was primarily related to the $250 million payment from Royalty Pharma offset by our operating cash burn, along with continuing capital projects. Our common share is outstanding at March 31, 2023, for $106.9 million. With that brief overview, I will now turn the call back to Chris.

Thanks, Ken. We've already had a busy 2023 and have made a great deal of progress on many fronts. However, we anticipate that the middle and into the second half of the year will be even busier and offer even more opportunities to demonstrate what our pipeline can bring to patients. We've always been clear that we believe for RNAi to reach its full potential as a revolutionary therapeutic modality, it needs to be able to address gene targets wherever they are. That is no longer a long-term goal. Between the liver franchise, the pulmonary franchise, the skeletal muscle franchise, the CNS franchise, and the adipose franchise, we have the opportunity to help a lot of people and create a substantial amount of value. But this is just the start. I expect us to blow through 20 and 25 and build a uniquely large and diverse pipeline of important medicines across multiple therapeutic areas. I have never been more excited about our near-term prospects or more proud of this amazing team. When you combine a technology that works with talented innovators who are aligned as to mission and empowered to make decisions and push science, incredible things can follow. We hope you can join us on June 1st at our R&D Day to hear more. Thank you for joining us today, and I would now like to open the call to your questions. Operator?

All right.

All right. Can you hear me okay? Yes. All right. Just make sure you can hear me okay. Thank you all. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star 11. on your telephone and wait for your name to be announced. To withdraw your questions, please press star 11 again. Please stand by while we compile the Q&A roster.

I also want to just remind the analysts that we, in the interest of time, we'd like to limit the questions to one question and one follow-up.

All right. Our first question comes from the line of Murray Raycroft with Jeffrey.

Thank you for taking my question. I was going to ask if you can provide some additional detail on what new data we will see at the R&D day from the cardiometabolic and pulmonary programs specifically. And as follow-up for the Phase III Palisade study, you mentioned readout in second quarter 2024. I'm just wondering if you will report on patient baseline characteristics at the R&D day or potentially at a medical meeting this year.

Thanks, Maury. So there's, let's see, there's several questions in there. What are we going to be talking about the R&D day? We'll be overviewing the pulmonary programs, of course, and we'll give you what data we will have at the time. We expect, as I mentioned in the prepared remarks, we expect to have some early normal healthy volunteer data from MUC5AC. I don't expect that we'll have MMP7 bit more of arrow rage. We also will talk about those targets as well as the indications. On the cardiometabolic side, it will be a good chance for us to talk broadly into treatment paradigms. We'll talk a bit about more recent data as well. We'll talk about the new CNS platform. We'll probably go into a little bit of the Adipose platform a bit. We'll talk about SOD1. We'll talk about the portion of ALS that we'll be addressing with SOD1. I'm sure I'm forgetting some things. It'll be a bit of a busy day. We have a lot going on, as you know, Maury, and we hope to touch on most of what we're doing.

Got it. And anything additional you can say about the Palisades study? Sounds like that's moving along and you'll have that readout second quarter of next year. Will you provide more on the types of patients that you've enrolled into the study? Is that something we could learn more about this year?

Sure, I think we will review the entry criteria, and that will give you a really good idea. But I don't think we're going to look at the baseline characteristics and report that ahead of the end of the study. This is a Phase III registration study. It's going really well. So I will review the key inclusion criteria so you get a sense of the patient population.

Got it. Okay, thanks for taking my questions.

All right. Thank you.

For our next caller, we have Eliana Merle with UBS. Please go ahead. Your line is now open.

Hey, guys. Thanks so much for taking the question and congrats on the recent pulmonary data. Maybe just in terms of the patient cohorts that we can expect later this year, I guess, how should we think about what endpoints in particular you'll be reporting out, I guess, between like FINO, FEV1, and what you'll be looking to see in some of that early data? Thanks.

James, do you want to address that?

Sure, yeah. So for RAGE, we're enrolling patients with mild to moderate asthma, and I think these are relatively small cohorts, so not powered for FEV1, although we will be measuring FEV1. Some of the key biomarkers that I think could be indicative of pathway engagement that knocking down RAGE is affecting the inflammatory pathways are things like pheno, which is an IL-13 driven parameter. We're also measuring blood and sputum eosinophils. I think that that'll be interesting as well. And periostin is also IL-13 driven. And then, as you mentioned, FEV1 and spirometry.

Great, thanks. Just a quick follow-up. I mean, maybe just what your latest thinking around what the clinically meaningful level of target knockdown as you look to sort of select the go-forward doses and how this could differ between RAGE and MUC5AC.

Yeah, so, you know, that's a really good question, but it's one that we just can't answer. You know, no one's been able to reduce expression of MUC5AC or RAGE in the past or MMP7 for that matter. And so there's just – we don't have a good mile marker for what that bogey could be. We will say, however, though, for RAGE, for instance, you know, we were seeing, you know, mean max knockdown after two doses in the zero at least at around 80%. In the animal models that we have studied, that was more than enough to, you know, to – to affect phenotype. These are severe models. And so that gives us some confidence. But again, they're just models. And so we really have to wait to see in humans what this looks like. We are excited about that level of knockdown. It's a good deep knockdown. And it appears to be durable. And so we are optimistic that we are on the board for RAGE and for MUC and for MMP7, as well as for future targets. We believe that because this is a target-rich environment, it feels likely to us that if you can knock a gene product down by 80 or so percent, then you're going to affect disease states in at least some of these targets. Awesome.

Thanks, guys. All right.

Thank you. Our next question comes from the line of Joel Beattie with Bayer. One moment.

The first one is, how could the profile of AEROSAD 1 potentially compare with Tofersen? And then the second question is, can you provide a little more color on Why, I think, eliminating the study of some of the PNH patients from the ARL-C3 study?

Yeah, sure. Thanks for the question. So, with regards to SOD1, I think that we will be competitive and likely better in terms of depth of gene target knockdown. And extremely importantly for this route of administration, interfecal route of administration, duration, which is key. If we can do intrathecal administration every three or even every six months, I think that would be much preferable for patients compared to, you know, every two weeks or every month dosing with tofericin. And then with regards to PNH, it was really a matter of competition. PNH is a small small market that's reasonably well addressed with a lot of ongoing competing clinical trials and competing marketed or soon to be marketed therapeutics. So we thought that, you know, we have limited resources and best to put those resources to work elsewhere.

Great. Thank you.

All right. Thank you so much. Our next question comes from the line of Mani Farohar. I'm sorry, did I say your name properly?

Close enough. Thanks for taking the question.

Go ahead.