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spk10: Good afternoon, ladies and gentlemen. Welcome to the Atea Pharmaceuticals 3rd Quarter 2021 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following the formal remarks, we will open the call up for your questions. I would now like to turn the call over to Joneigh Barnes, Senior Vice President of Investor Relations and Corporate Communications at Atea Pharmaceuticals. Please proceed.
spk02: Thank you, Operator. Good afternoon, everyone, and welcome to Attea Pharmaceuticals' third quarter 2021 financial results conference call. This afternoon, we issued a press release which outlines the topics we plan to discuss. You can access the press release as well as the slides that we'll be reviewing today by going to the investor section of our website at ir.atteapharma.com. With me today from Attea, our chief executive officer and founder, Dr. John-Pierre Sommadosi. Chief Development Officer, Dr. Janet Hammond, Chief Financial Officer and Executive Vice President of Legal, Andrea Porcarin, and our Chief Commercial Officer, John Bavarica. They will all be available for the Q&A portion of today's call. Before we begin the call, as outlined on slide two, I would like to remind you that today's discussion will contain forward-looking statements that involve risk and uncertainties. These risks and uncertainties are outlined in today's press release and in the company's recent filings with the Securities and Exchange Commission, which we encourage you to read. Our actual results may differ materially from what is discussed on today's call. With that, I'll now turn the call over to Jean-Pierre.
spk14: Thank you, Joné. Good afternoon, everyone, and thank you for joining us today. In addition to the financial results, we have a number of updates for 8527 to review. including an amendment to the Phase III Morning Sky trial protocol and a plan to accelerate its enrollment, quantitative infectious virus assay data from the Munson trial, confirming potent and rapid antiviral activity for 8527, and new in vitro data for 8527 demonstrating potent antiviral activity against a major variance of concern or interest, including Delta. I will begin on slide three. AT527, our already administered product candidate for COVID-19, is a direct acting antiviral agent derived from our purine nucleotide product platform. AT527 is designed to protect against disease progression and the development of long COVID complications. Given the evolving dynamics of COVID-19, which is becoming endemic, Medical intervention and all therapeutics in particular will be essential in stemming the tide of this pandemic and future surges. 85 to 7 targets viral RNA polymerase, a highly conserved enzyme critical to viral replication and transcription. Uniquely, 85 to 7 has a mechanism with dual targets. It is a chain terminator, without introducing new mutations in the virus, and it also inhibits NIRAN, thus providing the potential to create a high barrier to resistance and antiviral activity across variants, as we will share with you in a few minutes. In all studies, 8527 was shown to be generally safe and well-tolerated. On particular note, 8527 is not mutagenic with no reproductive toxicity, and it's non-theratogenic. We expect minimal drug-drug interaction since AT527 is a weak inhibitor of cytochrome P453A, and no dose adjustment is expected for co-administration of drugs that are CYP3A substrate, which account for the metabolism of more than 50% of clinically relevant drugs, so this should make our drug candidate prescriber friendly. On slide four, COVID variants of concern continue to create new challenges for treatment and prevention. These variants can also make the execution and evaluation of clinical trial results more challenging because of the impact and differences in viral kinetics as well as clinical symptoms. Ongoing SARS-CoV-2 genomic surveillance worldwide has improved our ability to rapidly identify such variants. As you can see on this chart, almost 6,000 variants have been sequenced with an outstanding number. The evolution of the virus will make COVID-19 endemic with the ability to continue circulating for years to come. SARS-CoV-2 variants of interest have been associated with increased transmissibility, neutralization resistance, and disease severity. The continuing spread of Delta has led to a new subtype called AY.4.2, or Delta Plus, which carries additional mutations. Although the original Delta variants remain the most dominant on a global basis, this new mutant now accounts for 14% of infections in the UK, up from less than 4% just early September, and is more likely contributing to the recent surge of the fifth wave of COVID in Western and Eastern Europe and other global areas. Preliminary evidence suggests that Delta Plus spreads between 12% and 15% more frequently among household members compared with other Delta viruses and will likely become an important strain, including in the U.S. Moving to slide six. As you know, we have previously shown that 8511, the free base of 8527, is a potent inhibitor of SARS-CoV-2 in vitro. The average EC90 in primary human airway epithelial cells against the original virus isolated in early 2020 was around 0.5 micromole, with a five-fold assay, approximately assay-to-assay variability, as you can see in this slide. We recently evaluated our drug candidate against the major variants of concern or interest, including alpha, gamma, epsilon, and more recently, delta. Consistent with its dual mechanism of action, AT511 maintained its potency against all the variants tested, including delta. We believe that this data confirmed the key mechanistic advantage of this drug candidate which target the highly conserved viral RNA polymerase. In fact, we have analyzed over 3 million SARS-CoV-2 sequences deposited in the database to date and found that less than 0.01% was mutation near the active site of the SARS-CoV-2 polymerase. With that, I will now turn the call over to Janet for a more detailed review of our clinical programs.
spk05: Thank you, Jean-Pierre. Beginning with slide eight. As you can see on this slide, our robust clinical program includes six studies of AC527 which are running in parallel. We are leveraging lessons learned from each of these studies to better serve our patients and updating our program in real time. There are two key updates on this slide. which include advancing the AT527 1100 milligram BID dose in the hospitalized study, and we expect results from the next cohort in the first half of next year. In addition, we are amending the phase three Morning Sky trial protocol with a new primary endpoint, a refined patient population, and an increased dosage, and we have a plan to accelerate enrollment completion. I will review the Morning Sky updates towards the end of my presentation. Turning to slide nine, as COVID-19 has continued to evolve, so have the ways to quantify the virus. After considerable effort, an optimized infectious virus assay is now available to quantify viable infectious virus in addition to the RT-PCR assay, which measures all forms of viral RNA obtained from the sample, regardless of whether it is from intact replicating virus or from non-viable virus or simply viral fragments. This difference is important because it should be a more accurate assessment of the impact of a direct acting antiviral on the ongoing infection. I will next review the new viral alert results 48527 from the Moonsong trial that we have obtained by using this infectious virus after. As outlined on slide 10, our methodology is quantitative and utilized a highly sensitive SARS-CoV-2 live virus assay. Measuring live virus in the nasopharyngeal swab samples from patients has been very challenging for this evolving field, but it is an important advance. Previously, qualitative data from a related type of assay was reported during the development of monothelial. In order to assess more specifically the antiviral effects of our drug candidate by using live virus, our CRO, in collaboration with our partner, Roche, has developed an optimized, highly sensitive, and quantitative infectious virus typhoid assay. As illustrated in this slide, a modified cell line with enhanced susceptibility to SARS-CoV-2 was inoculated with serially diluted nasopharyngeal samples so that we can determine the type of virus. After six days of incubation, positively infected cells were detected by SARS-CoV-2-specific immunostaining. This newly optimized assay has three key advantages. Firstly, it quantifies the infectious virus, thus eliminating the possibility of non-infectious virus or viral fragments by RT-qPCR, as previously reported. Earlier assays developed with monopyridine reported an infectious virus assay which was qualitative, only positive or negative. with no actual viral titer determined. Secondly, this is very accurate. And thirdly, it is highly sensitive. The level of quantitation of the assay is equivalent to approximately 10 infectious virus particles per milliliter. Please note that the analysis includes the approximately 71% of all patients in Moonsong cohorts A and B who had positive baseline cultures. On slide 11, Today we are reporting infectious virus data from the Moonsong study. You'll see that in cohort B, in the overall population, including both high- and low-risk patients with the majority being seropositive, 8527 at 1,100 milligrams BID-treated patients demonstrated a rapid and potent reduction in the viral load of half-log versus placebo at Bay 3. Turning to slide 12, we were able to see a treatment effect in the subgroup of patients who were at high risk with underlying health conditions, and these results reinforced the exploratory analyses in the same population with RT-PCR in Moonsong and the Phase II study in hospitalized patients. In cohort B, the acidly treated patients administered 1,100 mg BID had a robust viral load reduction of 0.9 of a log at day 3. These data also show a suggested dose response between cohort A and cohort B. Moving to slide 13. As I have just outlined, these additional data from the Phase II Moonsong trials support the rapid and potent antiviral effect of AC527 as measured by a quantitative highly sensitive infectious virus assay, which detects live virus capable of replication. Leveraging the lessons from Moonsong and as outlined in slide 14, as well as other recent results, we are submitting amendments to the global Phase 3 Morning Sky trial. Morning Sky is a randomized, double-blind, multi-center, placebo-controlled Phase 3 trial evaluating the antiviral activity, safety, and pharmacokinetics of 8527 in approximately 1,600 patients randomized one-to-one to receive AT527, 1,100 milligrams twice a day, or placebo. We, together with Roche, plan to leverage the existing operational global infrastructure from the Morning Sky clinical trial sites and expand its footprint with approximately 300 sites in new geographies. We expect to report the data from this trial in the second half of 2022. Amendments to our morning sky study include the following. Changing the trial's primary endpoint to COVID-19 related hospitalization or all cause mortality. The previous primary endpoint of time to alleviation or improvement of COVID-19 symptoms will become a secondary endpoint. Refining the patient population to include only unvaccinated high risk individuals. And lastly, increasing the dose of AT527 to 1,100 milligrams twice daily from 550 milligrams BID. Patients enrolled in Morning Sky have the option to be enrolled in LidoSpring, a six-month long-term follow-on study conducted in collaboration with Roche to evaluate long COVID in patients who received AT527 in comparison to placebo in Morning Sky. Let's now turn to AT752, our program for the treatment and prophylaxis of dengue fever on slide 16. Earlier this year, we initiated a randomized, double-blind, placebo-controlled, single, and multiple ascending dose phase one study to evaluate the safety, tolerability, and pharmacokinetics of AT752 in healthy subjects. We have completed part one of this study, the single ascending dose cohort, And in part two, the first two cohorts are complete and the last cohort is ongoing. We expect conclusion of this study by year end. During the first half of 2022, we expect to initiate our phase two study of HH752 for the treatment of dengue fever in Asia and South America. In this trial, we will enroll adults with a fever greater than 38 degrees within 48 hours of probable dengue infection and positive result on the NS1 antigen test or RT-PCR assay. The primary endpoint will be change in viral loads from baseline. We look forward to keeping you apprised of our progress in this important study next year. With that, I'll now turn the call over to Andrea for a review of the financials.
spk18: Thank you, Janice. As Joneigh mentioned in her introductory remarks, this afternoon we issued a press release containing our financial results for the third quarter of 2021. The statement of operations and the balance sheet are on slides 18 and 19. For the third quarter 2021, the increase in R&D expenses in comparison to the third quarter of 2020 was principally driven by an increase in external clinical development and manufacturing expenses. incurred primarily in conjunction with the advancement of AT527 for the treatment of COVID-19 and to a lesser extent AT752 which is being developed for dengue fever. These expenses include our share of costs incurred by Roche and increases in internal spend mostly due to an increase in personnel related expenses. The increase in general and administrative expenses was primarily due to the expansion of our organization in 2021 and consists principally in an increase in payroll and personnel-related expenses. I am pleased to report that we ended the third quarter with a strong balance sheet to support our clinical development programs. As of September 30, 2021, cash and cash equivalents were $839.7 million. This includes the $50 million development milestone the company received in July under our license agreement with Roche. I'll now turn the call back over to Jean-Pierre for closing remarks.
spk14: Thank you, Andrea. As Janet outlined, the protocol changes we are making to the Phase III Morning Sky study maximize our ability to demonstrate a positive clinical outcome. The updated inclusion criteria, dosing regimen, and primary endpoint should allow execution of a more focused and de-risked trial. Importantly, the encouraging infectious virus data we have disclosed today give us further confidence in AT527 rapid and potent antiviral activity against COVID-19, which is critical to stopping disease progression and transmission. We continue to be very excited by the opportunity that there is to change the course of COVID-19 dengue fever, hepatitis C, and other viral infections. This is an exciting time to be bringing forth what we believe to be groundbreaking technologies, and we look forward to updating you on our progress. As always, we thank you for your continued support as we build ATEA into a global leader in the discovery, development, and commercialization of oral therapies that address the unmet medical needs of patients with life sweetening bowel diseases. With that, operator, we will now open the call up to your questions.
spk10: All right, so as a reminder, to ask a question, you will need to press star 1 on your telephone. To resolve your question, press the pound key. Again, that is star 1 on your telephone. Please stand by while we compile the Q&A roster. First question comes from the line of Eric Joseph from J.P. Morgan. Your line is now open.
spk08: Hi, good afternoon. This is Hannah on for Eric. Thanks for taking the questions, just a few from us. So first, just want to get your thoughts on the feasibility of conducting the phase three trial where we have the Pfizer pill, Paxlovid, and Monopiravir accessible. How confident are you in the stated timelines that you've given? And then also, with the recently... It's reported in the Desivir outpatient trial, Pine Tree, which showed a meaningful effect in hospitalization or death despite a minimal or really no effect on viral load. Just wanted to get your take on this data set and then from a theoretical perspective, what other than viral load reduction do you think might translate to an effect on clinical outcomes? Thank you.
spk11: Sure. Janet, would you address both questions, please?
spk05: Thank you. Yes. So with regard to the feasibility of conducting the study, we believe that it's still feasible. And in some ways, I think it's unfortunate that it is. But I think vaccine rollout across the world, while impressive in many cases, is lagging in many others. And I think that, unfortunately, this provides an opportunity for many high-risk patients still to be susceptible to the disease. We have an extensive footprint already and plan to have a still further extensive footprint as we move forward. As I mentioned, we'll have more than 300 sites or thereabouts in the trial. And so we believe that study ought to be able to be enrolled and completed in the timeframe that we suggested. And then with regard to Remdesivir, I wasn't completely sure that I understood your question. I think that what Remdesivir showed very elegantly and in a large study was really that there was no correlation between viral load and clinical effect. And I think that probably that is true in general for the direct acting antivirals, particularly when measured by RT-PCR. And I think really some of what we have attempted to show today is really that in addition to RT-PCR, which seems to be a rather blunt tool and I think is recognized as such, the live virus assay that we have reported on seems to be somewhat more able to discriminate between viral fragments and non-viable virus than actual live virus. And I think we're actually sharing quite nicely even a suggestion of a dose response in what we're seeing there. Certainly, clinical endpoints are really what it's all about ultimately. I mean, that's what we all care about is whether the patient gets better. And if we can prevent hospitalization, and find some target endpoint which is able to help support that and ultimately be a useful target endpoint, that would be great. But I think the Remdesivir data actually are supportive of the field in general and what others are experiencing as well as ourselves.
spk07: Okay, great. That's helpful. Thanks for taking the questions.
spk10: Next one on the queue is Jonathan Miller from Evercore ISI. Your line is now open.
spk15: Thanks so much for taking the questions, guys. I have a couple of maybe more detailed ones on some of the data you released today. You mentioned that your Phase II cohort is majority seropositive. I think you said 71% seropositive at baseline. How different are the results there between seropositive and negative patients at baseline, for one? Then secondly, and sort of following on the last question, it seems like the majority of the patients on the 1.1-gram arm in Phase II were high-risk. And just trying to back out, obviously it's tough to do with my head on a long scale, but is it fair to say that the viral load impact in low-risk patients is really pretty modest? And then following on that prior question, if you think that there's not a good read-through from viral load to clinical efficacy, do you expect that direct-acting antivirals, maybe broadly, will have a meaningful clinical impact in low-risk patients? And I guess I'll pause there. It's a little bit less definite. Janet?
spk05: So, thanks, John. So, firstly, in regards to your question around the seropositivity, yes, the seropositivity was actually very high and perhaps not surprisingly increased, I think, as the study went on, although we're still awaiting some of the final serology data from Cohort A. But certainly in Cohort B, 87% of the treated patients were seropositive, and I think 80% in the placebo group. So really high numbers. And I think that does blunt what you're able to see. Perhaps it blunts it less, I think, in the high-risk patients than in the other ones. But I think essentially what we're seeing, and I think it perhaps answers some of your second question, too, around the viral load impact in the lower-risk patients. I think clearly if you're low risk, you're able to clear the virus perhaps more effectively yourself without the need for a direct acting antiviral. But I think if you're able to prevent hospitalizations, and I think as others have demonstrated, preventing hospitalizations and death in high-risk patients, you have to believe that you're having a similar effect, although it's harder to measure, in patients who are at lower or more modest risk for those types of outcomes. But nevertheless, I'm certain that you're probably shortening the duration of symptoms, and this is something that we have been hoping to demonstrate in our phase 3 trial, but it seems that these harder endpoints are certainly easier to document, and I think that points us to why we're going in the direction that we are with Morning Sky. But I think that if you're showing those types of benefits in high-risk patients, we need to refine the tools in which we demonstrate that in order to protect high-risk patients, you're clearly also showing benefit in lower-risk patients, albeit viral load, particularly by RT-PCR, isn't the perfect measure. But I think you can see that there are reductions in viral load across the board. I think just the higher risk patients, perhaps less surprisingly, also do tend to start off with higher loads. And clearly, you need to have a bigger delta to be able to demonstrate something. So I think it all tells the same story quite cohesively. I hope that answered the question.
spk15: Yes, somewhat. And then I guess one final one. How are you defining high risk in the new criteria?
spk05: So I think the definition is pretty standard in terms of patients being elderly, obese, diabetic, immunosuppressed, and I think also potentially asthmatic, patients with underlying renal disease, underlying tumors, and so forth.
spk12: And hypertension.
spk05: And hypertension, yes. Cardiovascular disease.
spk16: Thank you very much, Kim. All right.
spk10: So for the next question, we do have Tim Lugo from William Blair. The line is now open.
spk17: Thanks for the question and the additional data. I'd like maybe a broader... question on, you know, given the recent impressive protease inhibitor data, I'd just love to hear your updated thoughts around targeting the RNA polymerase directly versus the protease. You know, we, I guess, previously were thinking the correlations between HCV and HIV and other more chronic diseases would suggest the RNA polymerase was the correct targets for, you know, minimizing resistance, but is that still the case? and can we really extrapolate those diseases to SARS-CoV-2 and COVID-19?
spk14: Sure. Well, look, first we welcome really all progress in developing treatments as part of a multi-pronged approach to combat COVID-19 pandemic. And as there is several vaccines, we believe that multiple treatment options will be needed. So regarding, I don't think that one target is going to be better than the other one. You have seen the data I just mentioned about the remdesivir in our patient. Unfortunately, the drug can be given only IV, and obviously we know the limitations. I think we have not seen... from Pfizer, all the detailed analysis of the data, talking about viral load, talking about potential of emergence of resistance. And what I believe, what we believe, is that it's going to be a very different, I would say, situation in the real world than in clinical trials with protease inhibitors potentially used in immunocompromised patients used in so with maybe issues on taking all the doses at the right time and so We have to see, let's not forget that any drug, any antiviral drug with one-point mutation will very likely lead to resistance. When Tamiflu was launched in 2008-2009, there was absolutely no resistance at all. Just one year later, it was the majority of the flu strains were resistant to Tamiflu. I don't want to to picture a future negative picture on protease inhibitors. But I think we have to be, we can celebrate today, we should celebrate, but in the same time we need to see the reality for the future. As Janet indicated, we are going to have an endemic situation, there is going to be new strains, and I believe that I would not be surprised that we are going to talk about combination therapies, as you know, Tim, with potentially the combination of two different classes, and PI and NUC have been shown in the past to be a very interesting combination. So I think what we have learned over the last 12 to 18 months is is what we know today may be different in six months and surely in 12 months to come. So I would be cautious there.
spk17: Okay, that's understood and I agree. I think we're all looking towards the first combination that's going to be incredibly interesting. But I guess generally when we look across the oral trials and even remdesivir as well, the patient numbers that have been enrolled in the other trials have just been so much higher and I know Moonsong took a while to get underway. Could you just maybe comment on how Morning Sky will be different in terms of patient enrollment and really pushing patient enrollment? Because it did take a long time to get those patients for Moonsong.
spk14: You're absolutely right, Tim. We are very aware of it. Janet, would you share basically what we are putting in place, and now we foresee to accelerate the Morning Sky enrollment after we will have basically filed and finalized the amendments with the regulatory authorities.
spk05: So I think we have increased the sample size somewhat, but we certainly have, I think, really doubled down on the geographical footprint particularly looking at areas where we're likely to be able to enroll patients who are unvaccinated. And I think with that footprint and also I think with the potential for conducting an interim analysis and so forth similar to what others have been able to do, we believe that we should be able to meet the timelines that we are committing to and are confident that this is something which is still possible. We realize that the window is going to close as more people become vaccinated and also as therapies become more accessible, but we're certainly committed to doing this and really believe that we can.
spk17: Okay, that's understood. Maybe another, I guess, how many patients have been enrolled in morning sky by, you know, when you file the protocol amendments? And I, you know, if I recall, I think the higher dose had a bit of a nausea signal, are you going to be allowing antiemetics in morning sky? And I guess also, can you maybe give us some more details on this additional cohort from moonsong that we'll be expecting early next year?
spk11: Okay.
spk05: So firstly, with regard to the number of patients, it's not something that we've disclosed. Secondly, with regard to the use of antiemetics, we are going to educate physicians on the fact that there has been some GI signal. We don't believe that it's a particularly significant one at the moment, but it's certainly something that we are actively managing and also setting up studies to assess how best to address it in terms of potential food effects and protecting patients from feeling these symptoms, and something that we're actively working on. But we don't actually believe yet that we fully understand the significance of it, as there were some peculiarities with the patients where the adverse events were experienced. In particular, all of the adverse events that resulted in discontinuation all came from the same site, which is somewhat unusual. And so we're still trying to really understand that and work out how best to manage it. We will allow the use of antiemetics and make those available. But on the other hand, we don't want to encourage and allow people to believe that this is something that they're going to experience because it is something which I think is susceptible to some autosuggestion. It's quite a tricky one to manage, and we're actively thinking our way through that at the moment. And then lastly, in regard to your question around Moonsong, we're not planning to enroll any further cohorts in Moonsong, at least at the moment.
spk17: Okay. Thank you for all the granularity and all the answers. Best of luck.
spk13: Thank you, Jim. Thank you.
spk10: Next one on the queue is Rowana Ruiz from SBB-Lyrinc. Your line is now open.
spk04: Hi, thanks for taking the question. A couple regarding Morning Sky. I was curious, in your protocol amendment plan, would you possibly explore going for an even shorter time period than five days of symptom onset? As I believe, I think Pfizer's interim had less than three days of symptom onset or less.
spk05: So we're going to allow patients in who have had symptoms for five days or less. I think we will certainly try to ascertain whether their symptom duration was shorter than that, and we could certainly analyze by shorter duration and see whether that has an impact. There was a small impact, I think, in the Pfizer study, but it actually was surprisingly little, I thought. I mean, I think it was 87% versus 89%. Short is obviously better, but I don't think it made as much of a difference as I was expecting. Okay.
spk04: Makes sense. And I was also curious, in the remarks, it sounded like you will run the new Morning Sky protocol by the FDA. So does that mean that you're taking steps toward opening some trial sites in the U.S., or could you just give us an update on where that stands right now? That would be great.
spk05: So I can give you a broad update, which is that we continue to engage with the FDA, and we will be sharing with them the protocol. And we have ongoing positive dialogue, and we do hope that we will be enrolling patients in the U.S. in the study. But I think that's about what I can say.
spk03: Okay. Fair. Thanks.
spk10: And there are no further questions on the queue. I will now turn the call over back to the presenters.
spk14: So, again, thank you very much for your participation, and I would like to thank everyone, and thank you again. Good night.
spk10: This concludes today's conference call. Thank you for participating. You may now disconnect. Thank you. Thank you for watching. you Thank you. Thank you. Thank you. Thank you. you Good afternoon, ladies and gentlemen. Welcome to the Atea Pharmaceuticals 3rd Quarter 2021 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following the formal remarks, we will open the call up for your questions. I would now like to turn the call over to Joneigh Barnes, Senior Vice President of Investor Relations and Corporate Communications at Atea Pharmaceuticals. Please proceed.
spk02: Thank you, Operator. Good afternoon, everyone, and welcome to ATEA Pharmaceuticals' third quarter 2021 financial results conference call. This afternoon, we issued a press release which outlines the topics we plan to discuss. You can access the press release as well as the slides that we'll be reviewing today by going to the investor section of our website at ir.ateapharma.com. With me today from ATEA, our Chief Executive Officer and Founder, Dr. John Pierce-Somedosi. Chief Development Officer, Dr. Janet Hammond, Chief Financial Officer and Executive Vice President of Legal, Andrea Porcarin, and our Chief Commercial Officer, John Bevarita. They will all be available for the Q&A portion of today's call. Before we begin the call, as outlined on slide two, I would like to remind you that today's discussion will contain forward-looking statements that involve risk and uncertainties. These risks and uncertainties are outlined in today's press release and in the company's recent filings with the Securities and Exchange Commission, which we encourage you to read. Our actual results may differ materially from what is discussed on today's call. With that, I'll now turn the call over to Jean-Pierre.
spk14: Thank you, Joné. Good afternoon, everyone, and thank you for joining us today. In addition to the financial results, we have a number of updates for 8527 to review. including an amendment to the Phase III Morning Sky trial protocol and a plan to accelerate its enrollment, quantitative infectious virus assay data from the MUNSON trial, confirming potent and rapid antiviral activity for 8527, and new in vitro data for 8527 demonstrating potent antiviral activity against a major variance of concern or interest, including Delta. I will begin on slide three. AT527, our already administered product candidate for COVID-19, is a direct acting antiviral agent derived from our purine nucleotide product platform. AT527 is designed to protect against disease progression and the development of long COVID complications. Given the evolving dynamics of COVID-19, which is becoming endemic, Medical intervention and all therapeutics in particular will be essential in stemming the tide of this pandemic and future surges. 8527 targets viral RNA polymerase, a highly conserved enzyme critical to viral replication and transcription. Uniquely, 8527 has a mechanism with dual targets. It is a chain terminator without introducing new mutations in the virus, and it also inhibits NIRAN, thus providing the potential to create a high barrier to resistance and antiviral activity across variants, as we will share with you in a few minutes. In all studies, 8527 was shown to be generally safe and well-tolerated. On particular note, 8527 is not mutagenic. with no reproductive toxicity, and it's non-theratogenic. We expect minimal drug-drug interaction since 85-7 is a weak inhibitor of Cytochrome P450-3A, and no dose adjustment is expected for co-administration of drugs that are CYP3A substrate, which account for the metabolism of more than 50% of clinically relevant drugs, so this should make our drug candidate prescriber friendly. On slide four, COVID variants of concern continue to create new challenges for treatment and prevention. These variants can also make the execution and evaluation of clinical trial results more challenging because of the impact and differences in viral kinetics as well as clinical symptoms. Ongoing SARS-CoV-2 genomic surveillance worldwide has improved our ability to rapidly identify such variants. As you can see on this chart, almost 6,000 variants have been sequenced with an outstanding number. The evolution of the virus will make COVID-19 endemic with the ability to continue circulating for years to come. SARS-CoV-2 variants of interest have been associated with increased transmissibility, neutralization resistance, and disease severity. The continuing spread of Delta has led to a new subtype called AY.4.2, or Delta Plus, which carries additional mutations. Although the original Delta variants remain the most dominant on a global basis, this new mutant now accounts for 14% of infections in the UK, up from less than 4% just early September, and is more likely contributing to the recent surge of the fifth wave of COVID in Western and Eastern Europe and other global areas. Preliminary evidence suggests that Delta Plus spreads between 12% and 15% more frequently among household members compared with other Delta viruses and will likely become an important strain, including in the U.S. Moving to slide six, as you know, we have previously shown that 8511, the free base of 8527, is a potent inhibitor of SARS-CoV-2 in vitro. The average EC90 in primary human airway epithelial cells against the original virus isolated in early 2020 was around 0.5 micromole, with a five-fold assay, approximately assay-to-assay variability, as you can see in this slide. We recently evaluated our drug candidate against the major variants of concern or interest, including alpha, gamma, epsilon, and more recently, delta. Consistent with its dual mechanism of action, AT511 maintained its potency against all the variants tested, including delta. We believe that this data confirmed the key mechanistic advantage of this drug candidate which target the highly conserved viral RNA polymerase. In fact, we have analyzed over 3 million SARS-CoV-2 sequences deposited in the database today and found that less than 0.01% was mutation near the active site of the SARS-CoV-2 polymerase. With that, I will now turn the call over to Janet for a more detailed review of our clinical progress.
spk05: Thank you, Jean-Pierre. Beginning with slide eight. As you can see on this slide, our robust clinical program includes six studies of 85 to seven, which are running in parallel. We are leveraging lessons learned from each of these studies to better serve our patients and updating our program in real time. There are two key updates on this slide. which include advancing the AT527-1100mg BID dose in the hospitalized study, and we expect results from the next cohort in the first half of next year. In addition, we are amending the Phase III Morning Sky trial protocol with a new primary endpoint, a refined patient population, and an increased dosage, and we have a plan to accelerate enrollment completion. I will review the Morning Sky updates towards the end of my presentation. Turning to slide nine, as COVID-19 has continued to evolve, so have the ways to quantify the virus. After considerable effort, an optimized infectious virus assay is now available to quantify viable infectious virus in addition to the RT-PCR assay, which measures all forms of viral RNA obtained from the sample, regardless of whether it is from intact replicating virus or from non-viable virus or simply viral fragments. This difference is important because it should be a more accurate assessment of the impact of a direct acting antiviral on the ongoing infection. I will next review the new viral alert results 48527 from the Moonsong trial that we have obtained by using this infectious virus after. As outlined on slide 10, our methodology is quantitative and utilized a highly sensitive SARS-CoV-2 live virus assay. Measuring live virus in the nasopharyngeal swab samples from patients has been very challenging for this evolving field, but it is an important advance. Previously, qualitative data from a related type of assay was reported during the development of monothelial. In order to assess more specifically the antiviral effect of our drug candidate by using live virus, our CRO, in collaboration with our partner, Roche, has developed an optimized, highly sensitive and quantitative infectious virus typhoid assay. As illustrated in this slide, a modified cell line with enhanced susceptibility to SARS-CoV-2 was inoculated with serially diluted nasopharyngeal samples so that we can determine the title of the virus. After six days of incubation, positively infected cells were detected by SARS-CoV-2-specific immunostaining. This newly optimized assay has three key advantages. Firstly, it quantifies the infectious virus, thus eliminating the possibility of non-infectious virus or viral fragments by RT-qPCR, as previously reported. Earlier assays developed with monopyridine reported an infectious virus assay which was qualitative, only positive or negative. with no actual viral type determined. Secondly, this is very accurate. And thirdly, it is highly sensitive. The level of quantitation of the assay is equivalent to approximately 10 impetus virus particles per milliliter. Please note that the analysis includes the approximately 71% of all patients in Moonsong cohorts A and B who had positive baseline cultures. On slide 11, Today we are reporting infectious virus data from the Moonsong study. You'll see that in cohort B, in the overall population, including both high- and low-risk patients with the majority being seropositive, 8527 at 1,100 mg BID-treated patients demonstrated a rapid and potent reduction in the viral load of half-log versus placebo at Bay 3. Turning to slide 12, we were able to see a treatment effect in the subgroup of patients who were at high risk with underlying health conditions, and these results reinforced the exploratory analyses in the same population with RT-PCR and Moonsong and the Phase II study in hospitalized patients. In cohort B, the acidly treated patients administered 1,100 mg BID had a robust viral load reduction of 0.9 of a log at day 3. These data also show a suggested dose response between cohort A and cohort B. Moving to slide 13. As I have just outlined, these additional data from the Phase II Moonsong trials support the rapid and potent antiviral effect of AC527 as measured by a quantitative, highly sensitive infectious virus assay, which detects live virus capable of replication. leveraging the lessons from Moonsong, and as outlined in slide 14, as well as other recent results, we are submitting amendments to the global Phase 3 Morning Sky trial. Morning Sky is a randomized, double-blind, multi-center, placebo-controlled Phase 3 trial evaluating the antiviral activity, safety, and pharmacokinetics of 8527 in approximately 1,600 patients randomized one-to-one to receive AT527, 1,100 milligrams twice a day, or placebo. We, together with Roche, plan to leverage the existing operational global infrastructure from the Morning Sky clinical trial sites and expand its footprint with approximately 300 sites in new geographies. We expect to report the data from this trial in the second half of 2022. Amendments to our Morning Sky study include the following. Changing the trial's primary endpoint to COVID-19-related hospitalization or all-cause mortality. The previous primary endpoint of time to alleviation or improvement of COVID-19 symptoms will become a secondary endpoint. Refining the patient population to include only unvaccinated high-risk individuals. And lastly, increasing the dose of AT527 to 1,100 milligrams twice daily from 550 milligrams BID. Patients enrolled in Morning Sky have the option to be enrolled in LidoSpring, a six-month long-term follow-on study conducted in collaboration with Roche to evaluate long COVID in patients who received AT527 in comparison to placebo in Morning Sky. Let's now turn to AT752, our program for the treatment and prophylaxis of dengue fever on slide 16. Earlier this year, we initiated a randomized, double-blind, placebo-controlled, single, and multiple ascending dose phase one study to evaluate the safety, tolerability, and pharmacokinetics of AT752 in healthy subjects. We have completed part one of this study, the single ascending dose cohort, And in part two, the first two cohorts are complete and the last cohort is ongoing. We expect conclusion of this study by year end. During the first half of 2022, we expect to initiate our phase two study of 87-5-2 for the treatment of dengue fever in Asia and South America. In this trial, we will enroll adults with a fever greater than 38 degrees within 48 hours of probable dengue infection and positive result on the NS1 antigen test or RT-PCR assay. The primary endpoint will be change in viral load from baseline. We look forward to keeping you apprised of our progress in this important study next year. With that, I'll now turn the call over to Andrea for a review of the financials.
spk18: Thank you, Janet. As Joneigh mentioned in her introductory remarks, this afternoon we issued a press release containing our financial results for the third quarter of 2021. The statement of operations and the balance sheet are on slides 18 and 19. For the third quarter 2021, the increase in R&D expenses in comparison to the third quarter of 2020 was principally driven by an increase in external clinical development and manufacturing expenses. incurred primarily in conjunction with the advancement of AT527 for the treatment of COVID-19 and to a lesser extent AT752 which is being developed for dengue fever. These expenses include our share of costs incurred by Roche and increases in internal spend mostly due to an increase in personnel related expenses. The increase in general and administrative expenses was primarily due to the expansion of our organization in 2021 and consists principally in an increase in payroll and personnel-related expenses. I am pleased to report that we ended the third quarter with a strong balance sheet to support our clinical development programs. As of September 30, 2021, cash and cash equivalents were $839.7 million. This includes the $50 million development milestone the company received in July under our license agreement with Roche. I'll now turn the call back over to Jean-Pierre for closing remarks.
spk14: Thank you, Andrea. As Janet outlined, the protocol changes we are making to the Phase III Morning Sky study maximize our ability to demonstrate a positive clinical outcome. The updated inclusion criteria, dosing regimen, and primary endpoint should allow execution of a more focused and de-risked trial. Importantly, the encouraging infectious virus data we have disclosed today give us further confidence in AT527 rapid and potent antiviral activity against COVID-19, which is critical to stopping disease progression and transmission. We continue to be very excited by the opportunity Ateas to change the course of COVID-19 dengue fever, hepatitis C, and other viral infections. This is an exciting time to be bringing forth what we believe to be groundbreaking technologies, and we look forward to updating you on our progress. As always, we thank you for your continued support as we build ATERA into a global leader in the discovery, development, and commercialization of oral therapies that address the unmet medical needs of patients with life sweetening bowel diseases. With that, operator, we will now open the call up to your questions.
spk10: All right, so as a reminder, to ask a question, you will need to press star 1 on your telephone. To resolve your question, press the pound key. Again, that is star 1 on your telephone. Please stand by while we compile the Q&A roster. First question comes from the line of Eric Joseph from JPMorgan. Your line is now open.
spk08: Hi, good afternoon. This is Hannah on for Eric. Thanks for taking the questions, just a few from us. So first, just wanted to get your thoughts on the feasibility of conducting the phase three trial where we have the Pfizer pill, TaxLavid, and Monopiravir accessible. How confident are you in the stated timelines that you've given? And then also, with the recently It's reported in the Desivir outpatient trial, Pine Tree, which showed a meaningful effect in hospitalization or death despite a minimal or really no effect on viral load. Just wanted to get your take on this data set and then from a theoretical perspective, what other than viral load reduction do you think might translate to an effect on clinical outcomes? Thank you.
spk11: Sure. Janet, would you address both questions, please?
spk05: Thank you. Yes. So with regard to the feasibility of conducting the study, we believe that it's still feasible. And in some ways, I think it's unfortunate that it is. But I think vaccine rollout across the world, while impressive in many cases, is lagging in many others. And I think that, unfortunately, this provides an opportunity for many high-risk patients still to be susceptible to the disease. We have an extensive footprint already and plan to have a still further extensive footprint as we move forward. As I mentioned, we'll have more than 300 sites or thereabouts in the trial. And so we believe that study ought to be able to be enrolled and completed in the timeframe that we suggested. And then with regard to Remdesivir, I wasn't completely sure that I understood your question. I think that what Remdesivir showed very elegantly and in a large study was really that there was no correlation between viral load and clinical effect. And I think that probably that is true in general for the direct acting antivirals, particularly when measured by RT-PCR. And I think really some of what we have attempted to show today is really that in addition to RT-PCR, which seems to be a rather blunt tool and I think is recognized as such, the live virus assay that we have reported on seems to be somewhat more able to discriminate between viral fragments and non-viable virus than actual live virus. And I think we're actually sharing quite nicely even a suggestion of a dose response in what we're seeing there. Certainly, clinical endpoints are really what it's all about ultimately. I mean, that's what we all care about is whether the patient gets better. And if we can prevent hospitalization, and find some target endpoint which is able to help support that and ultimately be a useful target endpoint, that would be great. But I think the Remdesivir data actually are supportive of the field in general and what others are experiencing as well as ourselves.
spk07: Okay, great. That's helpful. Thanks for taking the questions.
spk10: Next one on the queue is Jonathan Miller from Evercore ISI. Your line is now open.
spk15: Thanks so much for taking the questions, guys. I have a couple of maybe more detailed ones on some of the data you released today. You mentioned that your Phase II cohort is majority seropositive. I think you said 71% seropositive at baseline. How different are the results there between seropositive and negative patients at baseline, for one? Then secondly, and sort of following on the last question, it seems like the majority of the patients on the 1.1-gram arm in Phase II were high-risk. And just trying to back out, obviously it's tough to do with my head on a long scale, but is it fair to say that the viral load impact in low-risk patients is really pretty modest? And then following on that prior question, if you think that there's not a good read-through from viral load to clinical efficacy, do you expect that direct-acting antivirals, maybe broadly, will have a meaningful clinical impact in low-risk patients? And I guess I'll pause there. It's a lot of fiddly stuff there. Janet?
spk05: So, thanks, John. So, firstly, in regards to your question around the seropositivity, yes, the seropositivity was actually very high and perhaps not surprisingly increased, I think, as the study went on, although we're still awaiting some of the final serology data from cohort A. But certainly in cohort B, 87% of the treated patients were seropositive, and I think 80% in the placebo group. So really high numbers. And I think that does blunt what you're able to see. Perhaps it blunts it less, I think, in the high-risk patients than in the other ones. But I think essentially what we're seeing, and I think it perhaps answers some of your second question, too, around the viral load impact in the lower-risk patients. I think clearly if you're low risk, you're able to clear the virus perhaps more effectively yourself without the need for a direct acting antiviral. But I think if you're able to prevent hospitalizations, and I think as others have demonstrated, preventing hospitalizations and death in high-risk patients, you have to believe that you're having a similar effect, although it's harder to measure, in patients who are at lower or more modest risk for those types of outcomes. But nevertheless, I'm certain that you're probably shortening the duration of symptoms, and this is something that we have been hoping to demonstrate in our phase 3 trial, but it seems that these harder endpoints are certainly easier to document, and I think that points us to why we're going in the direction that we are with Morning Sky. But I think that if you're showing those types of benefits in high-risk patients, we need to refine the tools in which we demonstrate that in order to protect high-risk patients, you're clearly also showing benefit in lower-risk patients albeit viral load, particularly by RT-PCR, isn't the perfect measure. But I think you can see that there are reductions in viral load across the board. I think just the higher risk patients, perhaps less surprisingly, also do tend to start off with higher loads. And clearly, you need to have a bigger delta to be able to demonstrate something. So I think it all tells the same story quite cohesively. I hope that answered the question.
spk15: Yes, somewhat. And then I guess one final one. How are you defining high risk in the new criteria?
spk05: So I think the definition is pretty standard in terms of patients being elderly, obese, diabetic, immunosuppressed, and I think also potentially asthmatic, patients with underlying renal disease, underlying tumors, and so forth.
spk12: And hypertension.
spk05: And hypertension, yes. Cardiovascular disease.
spk16: Thanks very much, Kim. All right.
spk10: So for the next question, we do have Tim Lugo from William Blair. The line is now open.
spk17: Thanks for the question and the additional data. I'd like maybe a broader... question on, you know, given the recent impressive protease inhibitor data, I'd just love to hear your updated thoughts around targeting the RNA polymerase directly versus the protease. You know, we, I guess, previously were thinking the correlations between HCV and HIV and other more chronic diseases would suggest the RNA polymerase was the correct targets for, you know, minimizing resistance, but is that still the case? And can we really extrapolate those diseases, the SARS-CoV-2 and COVID-19?
spk14: Sure. Well, look, first we welcome really all progress in developing treatments as part of a multi-pronged approach to combat COVID-19 pandemic. And as there is several vaccines, we believe that multiple treatment options will be needed. So, regarding, I don't think that one target is going to be better than the other one. You have seen the data just mentioned about the remdesivir in the outpatient. Unfortunately, the drug can be given only IV, and obviously we know the limitations. I think we have not seen from Pfizer all the detailed analysis of the data, talking about viral load, talking about potential of emergence of resistance. And what I believe, what we believe, is that it's going to be a very different, I would say, situation in the real world than in clinical trials with protease inhibitors potentially used in immunocompromised patients, used in, so, with maybe issues on taking all the doses at the right time, and so, We have to see, let's not forget that any drug, any antiviral drug with one point mutation will very likely lead to resistance. When Tamiflu was launched in 2008, 2009, there was absolutely no resistance at all. Just one year later, it was the majority of the flu strains were resistant to Tamiflu. So I don't want to to picture a future negative picture on protease inhibitors. But I think we have to be, we can celebrate today. We should celebrate. But in the same time, we need to see the reality for the future. As Janet indicated, we are going to have an endemic situation. There is going to be new strains. And I believe that I would not be surprised that we are going to talk about combination therapies, as you know, Tim, with potentially the combination of two different classes, and PI and NUC have been shown in the past to be a very interesting combination. So I think what we have learned over the last 12 to 18 months is is what we know today may be different in six months and surely in 12 months to come. So I would be cautious there.
spk17: Okay, that's understood and I agree. I think we're all looking towards the first combination that's going to be incredibly interesting. But I guess generally when we look across the oral trials and even remdesivir as well, the patient numbers that have been enrolled in the other trials have just been so much higher and I know Moonsong took a while to get underway. Could you just maybe comment on how Morning Sky will be different in terms of patient enrollment and really pushing patient enrollment? Because it did take a long time to get those patients to Moonsong.
spk14: You're absolutely right, Tim. We are very aware of it. Janet, would you share basically what we are putting in place, and now we foresee to accelerate the Morning Sky enrollment after we will have basically file and finalize the amendments with the regulatory authorities.
spk05: So I think we have increased the sample size somewhat, but we certainly have, I think, really doubled down on the geographical footprint particularly looking at areas where we're likely to be able to enroll patients who are unvaccinated. And I think with that footprint and also I think with the potential for conducting an interim analysis and so forth similar to what others have been able to do, we believe that we should be able to meet the timelines that we are committing to and are confident that this is something which is still possible. We realize that the window is going to close as more people become vaccinated and also as therapies become more accessible, but we're certainly committed to doing this and really believe that we can.
spk17: Okay, that's understood. Maybe another I guess how many patients have been enrolled in morning sky by, you know, when you file the protocol amendments? And I, you know, if I recall, I think the higher dose had a bit of a nausea signal, are you going to be allowing antiemetics in morning sky? And I guess also, can you maybe give us some more details on this additional cohort from Moonsong that we'll be expecting early next year?
spk11: Okay.
spk05: So firstly, with regard to the number of patients, it's not something that we've disclosed. Secondly, with regard to the use of antiemetics, we are going to educate physicians on the fact that there has been some GI signal. We don't believe that it's a particularly significant one at the moment, but it's certainly something that we are actively managing and also setting up studies to assess how best to address it in terms of potential food effects and protecting patients from feeling these symptoms, and something that we're actively working on. But we don't actually believe yet that we fully understand the significance of it, as there were some peculiarities with the patients where the adverse events were experienced. In particular, all of the adverse events that resulted in discontinuation all came from the same site, which is somewhat unusual. And so we're still trying to really understand that and work out how best to manage it. We will allow the use of antiemetics and make those available. But on the other hand, we don't want to encourage and allow people to believe that this is something that they're going to experience because it is something which I think is susceptible to some autosuggestion. It's quite a tricky one to manage, and we're actively thinking our way through that at the moment. And then lastly, in regard to your question around Moonsong, we're not planning to enroll any further cohorts in Moonsong, at least at the moment.
spk17: Okay. Thank you for all the granularity and all the answers. Best of luck.
spk13: Thank you, Jim. Thank you.
spk10: Next one on the queue is Rowana Ruiz from SBB-Lyrinc. Your line is now open.
spk04: Hi, thanks for taking the question. A couple regarding Morning Sky. I was curious, in your protocol amendment plan, would you possibly explore going for an even shorter time period than five days in symptom onset? As I believe, I think Pfizer's interim had less than three days of symptom onset or less.
spk05: So we're going to allow patients in who have had symptoms for five days or less. I think we will certainly try to ascertain whether their symptom duration was shorter than that, and we could certainly analyze by shorter duration and see whether that has an impact. There was a small impact, I think, in the Pfizer study, but it actually was surprisingly little, I thought. I mean, I think it was 87% versus 89%. Short is obviously better, but I don't think it made as much of a difference as I was expecting. Okay. Makes sense.
spk04: And I was also curious, in the remarks, it sounded like you will run the new Morning Sky protocol by the FDA. So does that mean that you're taking steps toward opening some trial sites in the U.S., or could you just give us an update on where that stands right now? That would be great.
spk05: So I can give you a broad update, which is that we continue to engage with the FDA, and we will be sharing with them the protocol. And we have ongoing positive dialogue, and we do hope that we will be enrolling patients in the U.S. in the study. But I think that's about what I can say.
spk03: Okay. Fair. Thanks.
spk10: And there are no further questions on the queue. I will now turn the call over back to the presenters.
spk14: So, again, thank you very much for your participation, and I would like to thank everyone and thank you again. Good night.
spk10: This concludes today's conference call. Thank you for participating. You may now disconnect.
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