Arrowhead Pharmaceuticals, Inc.

Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call. Without 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 Vince Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.

Thank you, Victor. Good afternoon. Thank you for joining us today to discuss Arrowhead's results for its fiscal 2026. First quarter ended December 31st, 2025. With us today for management are President and CEO, Dr. Chris Anzalone, who will provide an overview, Andy Davis, Senior Vice President and Head of the Global Cardio-Vetabolic Franchise, who will provide an update on commercialization activities, Dr. James Hamilton, Chief Medical Officer and Head of R&D, who will discuss our development programs, and Dan Appel, Chief Financial Officer, who will give a review of the financials. Following management's prepared remarks, we will open the call to questions. 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. We have done a quarter of strong execution across all areas of our business, and we are well positioned to build on this progress throughout 2026 and beyond. In fact, the recent months have included some of the more significant achievements in Arrowhead's history. Let's talk about some of these. First, on November 18, 2025, Arrowhead received its first regulatory approval and began the next phase of growth as a commercial company marketing its own medicines. The FDA approved Redentlo as an adjunct to die to reduce triglycerides in adults with familial cholomicronemia syndrome, or FCS. FCS is a severe, rare disease with an estimated 6,500 people in the U.S. living with genetic or clinical FCS, characterized by TG levels that can be 10 to 100 times higher than normal, leading to a substantially higher risk of developing acute, recurrent, and potentially fatal pancreatitis. This approval was supported by clinical data from the Phase III Palisade Study in adults with either clinically diagnosed or genetically confirmed FCS. The Palisade Study demonstrated deep and durable reductions in TGs with a median reduction of 80% from baseline and a lower numerical incidence of acute pancreatitis events compared to placebo. Arrowhead launched Redentilo independently in the U.S. with the Wander Redentilo pricing model that creates one consistent price across current and potential future indications. This is important. We're committed to sustainable innovation, and this requires a rational drug pricing according to the value a medicine offers to patients and healthcare systems. Redemblo is a pancreatitis drug, and when we think about pricing, we look to those patient populations at greatest risk of acute TG-related pancreatitis. We've only had drug in general for about 10 weeks, which included Thanksgiving, Christmas, and New Year's holidays, so it is difficult to infer too much about launch. However, initial trends in prescriptions, payer interactions, and shipments have been encouraging. To date, over 100 prescriptions for Adempilo have been received from a diverse prescriber base with geographically balanced uptake across the U.S. Early patient starts fall into three categories. patients transitioning from our expanded access program, patients naive to the APOC3 class, and patients switching from Olazarski. In addition, Redempolo shipments are being made for patients with clinically diagnosed and genetically confirmed FCS. In addition to FDA approval, we announced in January 2026 that Redempolo also received approval for the treatment of FCS from Health Canada and from the Chinese National Medical Products Administration. Redempla will be available later this year in Canada, and we anticipate it will be marketed independently by your eyes. Pending regulatory review and approval, we expect to potentially launch Redempla later this year in select EU countries and in the UK. In Greater China, Redempla will be marketed by Sanofi. Our cardiovascular pipeline is off to a good start with Redempla and the ongoing Phase III study of Zodacrin in homozygous familial hypercholesterolemia, or HOFH. We are actively expanding this pipeline with a number of discovery programs and, importantly, three clinical programs. Aero-INHPE and Aero-ALK7, being developed as potential treatments for obesity, are in Phase I-II studies. We also recently initiated a Phase I-II study of aerodimer PA in patients with mixed hyperlipidemia. For our initial obesity candidates, we recently announced some early interim clinical data. aeroin hpe enhanced weight loss and fat reduction versus terzapatide alone in obese patients with type 2 diabetes more specifically two administrations of aeroin hpe at the 400 milligram dose in combination with terzapatide achieved approximately two-fold better weight loss at week 16 than terzapatide alone this appears to be high quality weight loss as we saw in approximately three-fold reduction in each of total fat visceral fat, and liver fat measures based on week 12 MRI versus triseptide alone in these patients. The ARL-7 phase 1-2 study is approximately two quarters behind the ARL-I and HPE study, but early data are encouraging. We believe this is the first RNAi therapeutic to show adipocyte gene target silencing in a clinical trial, and we've seen dose-dependent reductions in adipose ALK7 mRNA with a mean reduction of minus 88% at the 200 milligram dose at week 8, and a maximum reduction of minus 94%. While these are very intriguing data, they are early and incomplete, so we have substantial work ahead of us before we get too excited about how these candidates could eventually be used. We will continue to run both Phase 1 and 2 studies. We are expanding existing cohorts to increase power, and we are adding new cohorts to better understand these candidates and underlying biology. We intend to report additional results later in 2026. Aerodimer PA is being developed as a potential treatment for atherosclerotic cardiovascular disease, or ASCVD, due to mixed hyperlipidemia, where both LDL cholesterol and triglycerides are elevated. We believe there are approximately 20 million people in the U.S. with mixed hyperlipidemia, and this is a patient population without adequate treatment options. We recently announced that we dosed the first patients in the Phase I-II clinical trial of aerodimer PA which is a dual-functional RNAi therapeutic designed to silence expression of the PCSK9 and ApoC3 genes, thus designed to reduce both LDL cholesterol and TGs. This represents an important step forward for the RNAi field, as we believe it is the first clinical candidate to target two genes simultaneously in one molecule, and an important step forward for preventative cardiology, as both LDL and TGs have epidemiologic support as being important drivers for ASCVD risk. We expect to have interim data for aerodata or PA in the second half of 2026. If we see good LDL and TG reduction in a well-tolerated manner, we may have something truly special for a very large and currently underserved patient population. Outside of cardiometabolic, we made important advances in our CNS portfolio, specifically in programs that utilize a new proprietary delivery system designed to achieve blood-brain barrier or BBV penetration utilized in subcutaneous administration. In non-fungal studies across multiple animal models, we saw deep target gene knockdown across the CNS, including deep brain regions. This underscores AeroVis leadership in the delivery of siRNA to multiple tissues and cell types throughout the body, utilizing the proprietary training platform. Our first fully-owned program using the BBB platform is AeroMapT, being developed as a potential treatment for cowopathies, including Alzheimer's disease. During the last quarter, we announced that we dosed the first subjects and a Phase 1-2 clinical trial that will include health volunteers and Alzheimer's patients. ARAMAP-T targets the tau protein in the brain, which has good biological validation as a potential driver of pathology, and has emerged as a promising target for Alzheimer's disease and additional tauopathies. We anticipate interim clinical data from the healthy volunteer portion of the study should be available in 2026, with data from the Alzheimer's patients to follow in 2027. This is a very exciting program. The second program to use our BPP delivery system is SRP 1005, formerly called AeroHTT, for the treatment of Huntington's disease. This program is partnered with Sarepta, which recently announced the submission of its CPA for study SRP 1005-101, also known as Insight, and approximately 24 participants. While our cardiometabolic and CNS work by no means encompasses everything we are doing, They are areas of substantial focus and potential value drivers in the near, mid, and long term. Within these areas, we are addressing three of the greatest public health challenges of our time, obesity, cardiovascular disease, and neurodegenerative conditions. Now, I'd like to move on to some key events during the recent period that have dramatically strengthened our balance sheet and give us the necessary resources to push multiple programs toward commercialization. We anticipate being funded through multiple potential independent and partner launches. These meaningfully increase revenue opportunities for the company and push us toward becoming cash flow positive and self-sustaining from commercial sales. Since our last reporting period, we have completed transactions with growth proceeds of $1.33 billion. Let's break that down. First, we completed a global licensing and collaboration agreement with Novartis for Arrow FMCA. Arrowhead's preclinical stage siRNA therapy against alpha-synuclein for the treatment of synucleinopathies such as Parkinson's disease. The collaboration includes a limited number of additional targets outside our pipeline that will utilize Arrowhead's proprietary TRIN platform. Arrowhead received a $200 million upfront payment and is also eligible to receive development, regulatory, and sales milestone payments of up to $2 billion. Arrowhead is further eligible to receive tiered royalties on commercial sales Second, we earned $200 million milestone payments from Sarepta following a drug safety community review and subsequent authorization to dose escalate and achievement of the second pre-specified patient enrollment target for Arrow DM1. Third, we closed concurrent public offerings of $700 million aggregate principal amounts of 0% coupon convertible senior notes and $230 million of common stock. Both offerings were several times oversubscribed and priced at company-friendly terms. As I mentioned at the beginning of the call, we demonstrated strong execution across all areas of our business. We received regulatory approval in three different countries. We launched our first commercial product. We continued to grow our cardiometabolic portfolio. We had encouraging early results from our obesity programs. We advanced our trim platform and CNS pipeline, and we meaningfully improved our financial position to push these and other programs forward. It has been productive the last few months at Arrowhead with so much potential to continue this strong progress in 2026 and beyond. With that overview, I'd now like to turn the call over to Andy Davis. Andy? Thank you, Chris, and good afternoon, everyone. It has been just over two months since the approval of Redentlo on November 18, 2025, and we are very pleased with the progress we are seeing. I'd like to share some early insights across healthcare provider engagement, patient dynamics, and payer developments. I'll start with healthcare provider engagement. As a reminder, we are targeting approximately 5,000 healthcare professionals through personal promotion, complemented by a much broader omni-channel effort. Early prescribing has been led by preventive cardiologists and endocrinologists, who together account for approximately 70% of total prescriptions, with the remainder coming from internal medicine physicians focused on lipid disorders. In addition, advanced practice providers, including nurse practitioners and physician associates, working within multidisciplinary care teams, are playing a meaningful role in patient identification and treatment decisions. Turning to patient dynamics, as Chris mentioned, over 100 prescriptions for Redemptive have been received to date. We see this as a very strong start that exceeded our expectations for the early months of the launch. We are also seeing geographically balanced uptake across the United States. Early patient starts fall into three categories, patients transitioning from our expanded access program, patients naive to the AQUA-C3 class, and patients switching from Olazarsen. Class naive patients represent the overwhelming majority of starts with expanded access and switch patients contributing evenly to the remainder. Patients receiving Redempt will include both clinically diagnosed and genetically confirmed FCS, with the majority not required to submit genetic testing to gain access. Importantly, a high proportion of patients are enrolling in the Rely on Redemplo patient support program, and in the fiscal first quarter, patients eligible for copay assistance paid $0 out of pocket. Next, I'll touch on payer developments. While it is still early, we remain encouraged by positive payer feedback on both the clinical profile of Redemplo and our unified one Redemplo pricing approach. We are actively engaged with the largest payers, and discussions to date reflect a willingness to cover Redempla to label, including access based on either genetic or clinical diagnosis of SCS. I'd like to conclude with a brief comment on execution. Within days of FDA approval, we had product available in the channel for SCS patients. Our Redempla care coordinators, rare disease specialists, and field reimbursement navigators were deployed on day one to support prescribers and patients. And our payer account team continues to work closely with customers to minimize access barriers. The teams are off to a great start. And our teams are highly encouraged by early stakeholder feedback. This feedback further reinforces the key differentiating attributes of Redemplo. As a reminder, in the Palisade study, Redemplor reduced triglycerides by 80% from baseline as early as month one and maintained this reduction with minimal variability through 12 months of treatment. In addition, the numerical incidence of acute pancreatitis was lower in Redemplor-treated patients than in placebo. And the U.S.-approved prescribing information includes no contraindications, no warnings, and no precautions. And Redemplor can be self-administered at home once every three months, just four injections per year. With that, I'll turn the call over to James Hamilton to discuss the R&D portfolio. Thank you, Andy. I'd like to start with a review of the Redemplo FDA approval and information in the label and contained in the package insert. Redemplo is approved as an adjunct to diet to reduce triglycerides in adults with FCS. The recommended dose of Redemplo is 25 milligrams, and it can be self-administered at home by subcutaneous injection once every three months. Redempla has no contraindications, warnings, or precautions in the US FDA-approved label. The most common adverse reaction includes hyperglycemia, headache, nausea, and injection site reactions. Redempla was studied in patients with both genetic STS and clinically diagnosed STS in the Phase III Palisade study. Patients achieved deep and durable reductions in median triglycerides of around 80% from baseline, with reductions largely maintained below the guideline-directed threshold of 500 milligrams per deciliter throughout the year of treatment. Importantly, patients with genetic FCS versus clinical FCS showed similar reductions from baseline. We see the clinical FCS population as having the same high on that need as the genetic FCS group, to have shown that both patient populations showed similar large reduction from baseline in triglycerides. In Palisade, treating patients also had a reduced rate of adjudicated acute pancreatitis events, a very welcome finding for FCS patients and their caregivers, and an important validation that reduction in triglycerides can, in fact, lead to reductions in pancreatitis. In addition to FCS, we are also investigating plazaciran in patients with severe hypertriglyceridemia, or SHTG. We announced last quarter that the FDA granted breakthrough therapy designation to investigation on plazaciran as an adjunct to diet to reduce triglycerides in adults with SHTG. Breakthrough therapy designation is a process designed to expedite the development and review of drugs, that are intended to treat a serious condition and where preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over available therapies on clinically significant endpoints. This is another important step for the program. The global phase three studies of plasastroin designed to support the supplemental MDA filing to span the label beyond genetic and clinical FCS of the SHASTA-3 and SHASTA-4 studies, which enrolled approximately 750 patients, and MIRA-3, which enrolled 1,400 patients. We're also enrolling patients in SHASTA-5 to directly assess the ability of prozacirin to reduce the risk of acute pancreatitis as the primary endpoint. We remain on schedule to complete the blinded portion of the SHASTA-3, SHASTA-4, mid-2026. We expect top-line data to be available in the third quarter of 2026 with planned SMEA submission for SHTT before the end of the year. We presented the study design and baseline characteristics of the Shasta 3 and Shasta 4 studies at the 23rd World Congress Insulin Resistance Diabetes and Cardiovascular Disease in December of 2025. I'd like to spend a moment to go over a few key parts of that poster. The primary endpoint of the Shasta studies and the accepted regulatory endpoint is TG lowering versus placebo. Plozaciran has been highly active in all patient population study, so these studies are overpowered to show TG lowering. One of the additional objectives and key secondary endpoints of Shasta 3 and Shasta 4 studies includes the assessment of acute pancreatitis rates. To be clear, the study was not designed or prospectively powered to demonstrate AP rate reduction after just a year of treatment. However, there are a meaningful number of SHTG patients enrolled that would be considered at high risk for AP. Specifically, among the two studies which will be pooled for AP event assessment, 37% of enrolled patients reported TGs greater than 880 milligrams per deciliter. accepted high-risk threshold for AP. In addition, 20% of enrolled patients had a prior medical history of pancreatitis. Lastly, we are seeing AP events in the studies. We are, of course, still blinded and have about another four months before the last patient reaches the end of the blinded period, but overall, the studies are progressing as planned. Chris mentioned the interim obesity results from our aero-inhibit E and aero-ALK7 programs earlier, but I'd like to add some color and talk about what we're adding to these programs. First, these early results were very encouraging. The next steps would be to investigate whether and where there is a therapeutic benefit and in the patient segments and treatment settings where it may be applicable. To review, the interim clinical trial results represent the first demonstration in humans that the active in E ALK7 pathway, a genetically validated pathway that regulates adipose fat storage, may potentially be harnessed therapeutically to improve body composition and enhance weight loss versus triseptide treatment alone in obese patients with type 2 diabetes mellitus. This patient population typically experiences less weight loss with increase in therapy. They're less likely to reach weight loss targets and need more effective treatment options. Importantly, heroin-given E in combination with trisepatide achieved approximately two-fold weight loss and approximately three-fold reduction in visceral fat, total fat, and liver fat versus trisepatide alone in obese diabetics. We saw signals that the pathway was active in the non-diabetics as well, but based on early data, the diabetic signal, particularly in combination with triceptide, appeared to be the clearest. We are planning, we are already in the planning and execution stage of the following next steps. Increasing numbers of patients in the phase one diabetic cohorts, including longer follow-up and better, to better understand drug durability and activity out to one year, and initiating monotherapy cohorts in obese diabetic patients. We expect to have more data later in 2026 from these programs as we see data from the new expanded scope of the Phase 1-2 studies. I will now turn the call over to Dan Appel.