Atea Pharmaceuticals, Inc.

Good afternoon, everyone, and welcome to the ITEA Pharmaceuticals 4th Quarter 2023 Financial Results and Business Update 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 ITEA Pharmaceuticals. Ms. Barnes, please proceed.

Good afternoon, everyone, and welcome to Atea Pharmaceutical's fourth quarter and full year 2023 Financial Results and Business Update Conference Call. Earlier today, 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.ateafarma.com. With me today from Atea are our Chief Executive Officer and Founder, Dr. John Pierce Amadosi, Dr. Aran Shahorga, Chief Medical Officer, Chief Development Officer, Dr. Janet Hammonds, Chief Financial Officer and Executive Vice President of Legal, Andrea Corcoran, and our Chief Commercial Officer, John Babrita. They will all be available for the Q&A portion of today's call. Before we begin the call, and 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 risk 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.

Thank you, Jonette. Good afternoon, everyone, and thank you for joining us. I will begin on slide three. Looking back at our substantial progress throughout 2023, I'm proud of the strong operational execution we achieved across our antiviral programs. The 2023 highlights from our COVID-19 program include the ability to leverage global surges to meaningfully advance our Phase III, Sunrise III study. This was made possible by the expansion of the global footprint and the broadening of the eligibility criteria for high-risk patients. So far in 2024, we continue to observe encouraging enrollment trends for Sunrise Threat. Reflecting the continuing unmet medical need, we were granted fast-track designation by the FDA for the evaluation of Benifazovir for COVID-19. We have continued to demonstrate that Benifazovir remained fully active against all variants tested in vitro, including the newest sub-variants related to the O-micron. The profile for Benifazovir is supported by robust clinical data, including favorable efficacy and safety, with no drug-drug interaction. We believe that Benifazovir has the potential to address the key limitations of current COVID-19 oral therapies. For HCV, the 2023 highlights include achieving regulatory approvals of a short eight-week treatment for the global phase two trial of the combination of Benifazivir and Rizazivir for the treatment of HCV. The rapid enrollment of the leading cohort, which has led to exciting SVR results that we will review today. we demonstrated in vitro synergy of the combination of benifazovir and resizivir and the comparing potency profile against major HCV resistance mutations. We are now evaluating several fixed-dose combination tablets in preparation for the Phase III program and subsequent commercialization. And we presented and published preclinical and clinical data in support of this program. We believe Benifazivir in combination with Rizosvir can significantly improve upon the current standard of care by offering a differentiated, short eight weeks, protease inhibitor free treatment, which has been well tolerated and has limited potential for drug-drug interactions. Moving to slide four. ATEA vision is focused on the discovery and development of antiviral drugs for the treatment and cure of serious viral diseases where there is a significant unmet medical need and where we can make a huge difference. As you know, we believe that COVID is here to stay. And the recent winter surge reminds us that new dominant variants like GN1 are striving despite the latest vaccine booster and treatments. The SARS-CoV-2 virus is accumulating mutations with amino acid substitutions faster than any other endemic RNA virus, highlighting the desperate need for a broader and more diversified arsenal of safe, well-tolerated, and easy to prescribe oral antiviral therapeutics. Our team continues to efficiently execute our global phase three trial, and I'm very pleased to announce today that we have achieved another significant clinical milestone and surpassed enrollment of 1,400 patients, triggering our second interim analysis in the supportive care monotherapy cohort. This is an important milestone. allowing for the data review by the independent DSMB for safety and fertility. For Sunrise 3, we anticipate several upcoming events, including the first interim analysis in March, the second interim analysis in the second quarter of 2024, and top line results during the second half of 2024. Benifaz maybe has the potential to address many of the key limitations of curing COVID-19 therapies, including safety, durability, and drug-drug interactions. Our goal is to deliver best-in-class treatment to the millions of patients for whom the current center of care is suboptimal or unsuitable. As part of a multi-pronged approach against COVID-19, We continue to also make progress with our discovery program focused on a highly differentiated second-generation protease inhibitor, and we expect to provide an update mid-year. For our Phase II HCV program, as stated earlier, we share new results with confirmed and 98% SVR4 post-treatment in the leading cohort of our Phase II combination. eight-week study. I will review these results in more detail. Our goal for this program is to substantially enhance the current set of care by offering a short eight-week protease inhibitor-free treatment that is well tolerated with low potential risk for drug-drug interaction for all HCV patients. Importantly, We are in a strong financial position to execute our strategy with $578.1 million of cash and cash equivalents as of December 31st, with a runway anticipated through 2026. Andrea will provide a detailed update on Atea's financial position during today's call. I will now turn the call over to Arentza for an update on our HCV program.

Thank you, Jean-Pierre. Turning to slide six, despite current treatment options, HCV continues to be a health crisis in the U.S. As Jean-Pierre noted earlier, there are approximately 2.4 million people infected with HCV in the U.S. despite availability of oral treatments. Recent trends indicate there are more new infections and reinfections than cures on a yearly basis. and these statistics highlight the need to improve the HCV treatment landscape. The combination of benifosovir and bucephalovir has the potential to substantially improve upon the current standard of care by offering a short eight-week protease-inhibitor-free treatment with less side effects and a low risk for drug-drug interactions. Based on our market research with KOLs and high prescribers, These attributes are very critical for a new treatment, as you will see on the next slide. Moving to slide seven, while the introduction of direct-acting antivirals has transformed HCV treatment, significant unmet needs still exist. In recent quantitative market research conducted by Atea, with over 150 U.S. physicians who are high prescribers of Eclusa or Maviret, Only 6% of these physicians reported that there are no unmet needs regarding HCV treatment. Key unmet needs emerging in this research were shorter lengths of treatment and higher efficacy, particularly in HIV-co-infected patients, as well as fewer contraindications as detailed on the right hand of the slide. Please note that currently approximately 17% of patients do not complete their treatment regimen, making convenient and shorter treatment durations of particular importance to prescribers. Slide 8 outlines our Phase II open-label study of 550 mg of benifosfovir in combination with 180 mg of rusesvir once daily for 8 weeks. we plan to enroll up to 280 DAA-naive patients across all genotypes. In the initial cohort, sustained biological response, or SBR, at week four was used as the decision criteria to reinitiate enrollment to complete the phase two study. The primary endpoint of this study is SBR at week 12, and this will be reported for all patients at study completion. Slide nine highlights the patient demographics and baseline characteristics in the leading cohort of the phase two open-label study of benifosfovir and rusosvir. The patients were DNI with a median age of 47 years old. This cohort was comprised of non-cirrhotic patients only. However, please note that 10 patients had fibrosis stage of F3 and were advanced liver disease stage which is borderline with cirrhosis. In the second part of the phase two study, compensated cirrhotic patients will also be enrolled. Moving to slide 10, we are excited to share with you today that the final results from the phase two combination study in the leading cohort confirmed an SBR4 of 98% post-treatment across all genotypes. In January, We reinitiated enrollment to complete the study in up to 280 patients with top-line results anticipated in the second half of 2024. 7 shows the on-treatment viral kinetics of individual patient data. By week 4, all 60 patients in this cohort had viral load near or below the lower limit of quantification. Therefore, this very rapid kinetics across all genotypes, support an eight-week regimen, and compare favorably to the only approved eight-week treatment for HCP. On slide 12, the combination of benifosavir and rusavir was generally safe and well-tolerated in this cohort of 60 patients. There were no drug-related serious adverse events, no discontinuation, and adverse events were mostly mild. Turning to slide 13, to summarize our progress in HCV, based on the positive leading cohort data, we reinitiated enrollment in January for the remainder of the Phase II trial. To help advance enrollment and achieve representative genotype distribution, we are increasing this study's footprint to approximately 50 clinical sites in 15 countries. In addition, over the first half of 2024, we are conducting phase one studies in the U.S. for the selection of the six-dose combination tablet, which will be evaluated in the phase three program and used for subsequent commercialization. We anticipate that the phase three program will be initiated around the end of this year. Slide 14. Next, we will provide an update on our COVID-19 program I'll turn the call over to Janet to discuss our Sunrise III Phase III trial.

Thanks, Arantxa. Good afternoon, everyone. COVID-19 continues to be an established pathogen of concern, according to the World Health Organization. And we believe that COVID-19 will remain an ongoing, serious endemic issue. Our goal for COVID-19 is to deliver a safe and effective treatment to millions of patients for whom the current standard of care is not a suitable option. We believe that the compelling preclinical and clinical profile of Benifosbuvir is differentiated with a low risk for drug-drug interactions, a favorable tolerability, and a high barrier to resistance, and has the potential to become the treatment of choice for COVID-19 for millions of patients. Moving to slide 16. Supported by our extensive global footprint, we are seeing robust enrollment into Sunrise 3, and patient enrollment has correlated with the latest winter waves. In particular, we've experienced strong enrollment in the U.S., where sites have been responsible for approximately 75% of the patients enrolled today. The majority of patients globally continue to be enrolled in the monotherapy cohort, despite the availability of other oral antivirals. We're excited to share with you today that Sunrise Street surpassed enrollment of 1,400 patients in the monotherapy cohort, triggering the second interim analysis. The DSMB is expected to meet in March for the first interim analysis, and we expect the second interim analysis to occur during the second quarter. Just to remind you, the DSMB reviews are primarily geared towards safety and futility. So far this winter, as predicted by the US CDC, respiratory diseases are showing similar high trends to last year. The patients most vulnerable to severe COVID infection remain the elderly, the immunocompromised, and those with underlying risk factors for severe infection. But oral therapeutics are of critical importance to protect against hospitalization and complications. Turning to slide 17. I'll now go into detail on our summarize three global phase three trials. To start, our inclusion criteria focus on high-risk outpatients with mild or moderate COVID-19, regardless of vaccination status. Symptom onset is five or less days before randomization. The phase three study is randomized, double-blind, and placebo-controlled. The study drug, either Benefostavir 550 mg BID or placebo is administered concurrently with the locally available standard of care. There are two study populations, depending on the type of standard of care received. The supportive care monotherapy cohort comprises the primary analysis population, while the combination cohort is part of the secondary analysis and includes patients treated with local standard of care, including other compatible COVID-19 antiviral drugs. The primary endpoint to the study is all-cause hospitalization or death through day 29 in the supportive care monotherapy population, which will be approximately 2,200 patients. The secondary endpoints are COVID-19-related hospitalizations and deaths, medically attended visits, and symptom relapse. Last year, we were granted fast-track designation for Benefoscivia, reflecting the recognized unmet medical need that remains for COVID-19 patients. Overall, we're seeing strong operational execution for Sunrise 3 from our clinical team with robust enrollment trend. I'm now going to hand the call over to John to discuss the marketing opportunity for Benefoscivia. John?

Thank you, Janet. Turning to slide 19. We know that the U.S. prescription demand for oral antivirals to treat COVID correlates with the infection rates. The demand for oral antivirals in 2023 was very robust with a total of approximately 7.7 million scripts written. Last month, the scripts were approximately 920,000, which reflects the latest winter surge. On the next slide, slide 20, late last year, the market for COVID-19 oral antivirals began transitioning to traditional payer markets such as Medicare, Medicaid, and private commercial insurance. Oral antiviral therapeutics for COVID-19 are expected to remain a multibillion-dollar opportunity for years to come. Projected annual COVID-19 oral antiviral U.S. demand using IQVIA retail prescriptions suggests an estimated annual global market opportunity of over $4 to $5 billion, with only two products that each have key limitations We believe there is still an unmet need with critical gaps, and there is the opportunity to expand this market to patients due to drug-drug interactions and tolerability with Paxlovid and safety issues with Ligavrio. I'll now turn the call over to Andrea to discuss the TEAS financials.

Thank you, John. As Joneigh mentioned, earlier this afternoon, we issued a press release containing our financial results for the fourth quarter and full year 2023. The statement of operations and balance sheet are on slides 22 and 23. There was an increase in R&D expense for the fourth quarter and full year 2023 versus the corresponding period in 2022. The primary driver for the higher expense was the external expense related to our COVID-19 phase three sunrise. three clinical trials, and our phase two clinical trial of the combination of benifostavir and rusavir for the treatment of hepatitis C. General and administrative expenses remained relatively flat for the fourth quarter and full year versus the corresponding period in 2022. Interest income increased for the fourth quarter and full year 2023 versus the corresponding period in 2022. This was the result of investing in higher yield marketable securities and higher interest rates. At the end of the fourth quarter of 2023, our cash, cash equivalent, and marketable securities balance, as Jean-Pierre mentioned, was $578.1 million. Based on our current plans, we are reiterating our cash guidance with a runway through 2026. I'll now turn the call back over to Jean-Pierre for closing remarks.

Thank you, Andrea. In closing, following a year of solid operational execution across our two clinical programs. Our clinical momentum set us up for a transformational milestone-rich 2024 for both our COVID-19 and HCV program. For COVID-19, we anticipate meaningful clinical milestones beginning in the first quarter of 2024 with the first interim analysis from our global phase three trial. followed by a second interim analysis in the second quarter of 2024. Top log results as expected in the second half of 2024. For HCV, we anticipate completing enrollment of our phase two study and reporting results during the second half of 2024. We have continued to target initiation of a phase three around the end of the year, and we are extremely encouraged by the SVR4 and safety results in the leading cohort. We are targeting multi-billion dollar markets, each of which are currently comprised of only two primary products. We believe that our product candidates are very differentiated and have the opportunity, if approved, to fill the gap in the current unmet medical needs and become blockbuster products. We are very excited about the opportunities ahead and are confident in our ability to develop and commercialize innovative products and create meaningful shareholder value. In particular, I'm very proud of the team hard work throughout the year, a pair It's a company with less than 80 employees, which is conducting two global studies in disease with multi-billion dollar market opportunities, with a high degree of efficiency, as well as with significant financial discipline. With that, I will turn the call back over to the operator.

Certainly. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again in one moment for our first question. And our first question will come from Eric Joseph of J.P. Morgan. Your line is open, Eric.

Thank you, and thanks for taking the questions. A couple from us. Just on the sizable accrual in patients for Sunrise 3, do you have visibility in terms of, I guess, how those are apportioned across the different study arms, monotherapy versus combo. I guess, what visibility do you have in terms of percent to enrollment completion of the monotherapy primary analysis population? And on the HCV side, just picking up on a comment you made, JP, about potentially being a non- protease-based inhibitor option. What's the significance of that? Is there sort of a safety advantage that you'd highlight, or is it more about just being an alternative mechanism compared to the other commercially available eight-week regimen? Thanks.

Thank you, Eric. There is definitely an importance in the differentiation. But let's start with the COVID-19 questions. Great question. Janet, you want to give a little bit some... granularity to Eric?

Thank you, Eric, for the question. So in regard to how the patients are apportioned to the combination versus monotherapy, I mean, obviously, first of all, just to say that this is at the discretion of the investigator and prescriber who sees the patient, and they are encouraged to prescribe combination therapy if they believe that is appropriate for the patient. And are actually educated quite extensively at our investigation meetings in that regard. And what I think is quite surprising is that the vast majority of patients are actually being assigned to the monotherapy arm. And I think reasons for this probably are really the extensive potential for drug interactions associated with ritonavir in the Paxlovid combination treatment, which I think and deters people from prescribing combination therapy to patients. And then in regard to your question around if we have any visibility as to when we might complete accrual in the monotherapy arm, no, we don't. But I can say that enrollment is proceeding well. But of course, we're very dependent on the fluctuations in COVID cases as they occur. We've seen a very strong winter season. Frequently, I think, at least in the past, we've observed that that's followed by some downward trend in the number of cases until we get towards the hotter summer months when people move indoors again. So we're somewhat dependent on that. We'll have to see. Thank you.

So related to the HCV questions, I think with the survey from a third party, it really exemplified the importance of a lack of protease inhibitor in the combination treatment, especially when we are talking about about 40% of HIV-infected patients with HCV, where you're going to have substantial drug-drug interaction if you have a protease inhibitor. So it is an important differentiation. John, you want to maybe also expand on that and really... This is not just a gimmick here that we are talking about. It's really important from a commercial standpoint, and then I will ask our answer from a patient standpoint. John, do you want to address that from a commercial standpoint?

Sure. So, Eric, from a commercial standpoint, obviously being ProteA3 is really important to us for the low, low drug DDI interaction potential. And also, there's also other advantages such as having a no food effect and also to be able to treat with a shorter treatment duration, particularly important because as Arantxa mentioned earlier in the presentation, what clinicians are finding is that the shorter time to treat is the better. And to highlight this about, you know, Maviret has obviously a protease inhibitor. And when you look at the new Rx market shares, even despite being eight weeks versus 12, there's, you know, there's almost a little bit more than a 10-point share difference in favor of occlusal. And so that should maybe also tell us some things as well.

Our answer from a patient standpoint after your discussion with K1 and prescriber, go ahead.

Yes. So from a medical perspective, I think what we're trying to develop here is really a best-in-class regimen that combines the best of Eclusa and the best of Maviret in the sense that it's an eight-week regimen. And without the drug-drug interactions, that are actually quite common that Maviret and protease inhibitors have as a class. And these are common drugs. We're talking about things like contraceptives, antiretroviral therapies, statins, proton pump inhibitors, which, you know, almost everybody over 40 is on something like that. So this is very important for the patients, as the market research has indicated, but also when we talk to the KOLs on the field and when they were actually trying to review our protocol and participate in our clinical trial, all of them were very excited that we could actually develop this best-in-class regimen, bringing the best of both attributes of both regimens.

Thank you, Aretha.

And one moment for our next question.

And our next question will be coming from Maxwell Score of Morgan Stanley. Your line is open, Maxwell.

Great. Thank you for taking my questions. Given your strong financial position, I was hoping you can elaborate a bit on your capital allocation strategy and how you're preparing for a potential launch in COVID. while advancing your global HCV program? Basically, how should we think about spend over the next several quarters? Thank you.

Andre, do you want to address that question? Maybe just I'd like to indicate that for the launch, we have actually supplied, if we are fortunate, to get an approval or in any way. But we will not do substantial investment in manufacturing at risk prior to approval. So we will provide additional information as we get closer to launch. So with that parenthesis, Andrea?

Yes. Thank you, Jean-Pierre. And thanks, Max, for the question. So I think as you've seen or will see when you have the chance to review the financial statements, You know, we continue to exercise really discipline in our investments for both the COVID-19 program as well as the HEPC program. Expenses are increasing, but in a very measured way, quarter over quarter for 2023. We would expect the same type of limited increase in 2024. The phase three program for COVID will begin to wind down before the phase three begins for HEPC. But nonetheless, we will be preparing for commercialization, as you said, so there will be additional activities that we will be funding at that point. So the expenses for 24 and 25 are expected to increase, but in a very measured way.

Great. Thank you.

And one moment for our next question. And our next question will be coming from John Miller of Evercore ISI.

Your line's open, John.

Hi, this is Jessica on for John Miller. Thanks for taking our questions. I have two questions, if I may. One on COVID, one on the Hep C front. So for COVID, so you said Sunrise 3 top line data expected in second half of the year. So how should we think about the various scenarios that can occur? How well does the market appreciate that preexisting immunity from infection and or vaccination can affect placebo rates, possibly making the effect size smaller. And maybe a direct comp to Paxlova trial data may be limited. And then also worst case scenario, how should we think about the company direction in the bear case scenario that the primary endpoint is not met? And then I have a follow-up question. Thank you.

Janet, would you like to address the question, please?

Thank you, Jessica. So, yes, I think everybody realizes that with vaccination and prior exposure to COVID-19, the severity of the disease is frequently less severe, fortunately, than it was when we were going through, in particular, I think the Delta wave and hospitalizations are at an all-time high. Our study is designed, though, to show a Delta in efficacy comparable So I think what Pfizer most recently reported in their outpatient study where there was about a 50% or in the 50s difference between the active and the placebo groups. And so that's what we're expecting to see. I think particularly when you're talking about high-risk patients and hospitalizations, that is still an important and meaningful difference. And of course, hospitalization and death are the worst outcomes. And so if one can prevent those and reduce the severity of disease. I think that's going to be really important.

Yeah, just to add... Oh, go ahead, Jen. Sorry, go ahead.

No, I was just going to ask you if you wanted to follow on with Jessica's other question around the scenario where we fail to achieve a primary endpoint.

Yes, go ahead.

Okay, so... I think, I mean, certainly, I mean, it's one of those things that is under consideration is, you know, if we're unable to do that, are there further avenues to pursue in terms of looking for trends? And we have a fast track designation with FDA to assess how to proceed. But we also have, as I think has been mentioned, two interim analyses. where the DSMB will help us to make the decision not to proceed should we see that no number of patients in what we are projecting would allow us to be successful. So I think those are the scenarios that we're certainly aware of and thinking about. But at the moment, things are moving forward well, and we look forward to presenting results and allowing you to update as we move forward.

Thank you, Janet. Just what I wanted to add to the first question is I think it's very telling that the NIH actually recently reported that only 15% of high-risk actually are taking Paxlovid. And actually, so 85% of high-risk who should get an oral therapeutic don't. Well, very likely many of the reasons of the limitation of PaxLavit. So you can see that there is a huge opportunity here for a best-in-class product, including even with the challenges that we face. As Janet and Jessica, you recognize in terms of number of low events, but we believe that the way the study has been built will maximize the results. for the efficacy and safety of this drug. So I understand you may have another question on HCV as well?

Yes, thank you. So on the Hep C program, given the context that compliance with existing therapies is lacking with existing regimens, so there's an unmet need here, and the patients you're presumably going after are the ones that we know already are bad at compliance or else they'd be cured already. How do you guys plan to ensure for the phase three that the protocol and clinical sites can optimize good drug adherence, especially since we've already seen that one patient in phase two report here who is thus unable to achieve SVR4?

That's a great question, Jessica. Arentha, we spent quite some time on that. So, Arentha, would you like to address the question?

Yes, it is a great question. I think, you know, in part, The compliance issues are just part of the nature of doing trials right now in hepatitis C. The population that we have that is in high need right now is a bit of a mix of the patients who are not taking drugs and they are just general patients, but also there is a very large population of patients that are ex-IV drug users or IV drug users. And those really benefit from short treatment durations. So I think by offering a short treatment duration, you're already addressing some of the compliance issues because, you know, patients in general are very excited to take drugs at the beginning, but then, you know, sometimes they forget towards the end of the treatment. I think we have all experienced that. So the eight-week duration already helps. We, of course, have, you know, the regular measurements of, you know, checking with the patients, calling them, bringing them in. And very important in phase three is that we're going to have a comparator. So the issues with compliance will affect both arms equally because the patients are randomized. And there you're really going to see how the comparator is behaving in today's kind of population, which includes these patients that are, you know, noncompliant in general.

And obviously, we will... to finalize any protocol with the regulatory authorities. So, but based on our initial interaction, it's clear that a comparator is required for our phase three program.

Thank you very much. And one moment for our next question. And our next question will be coming from Roana Ruiz of Lering Partners. Your line is open.

Thank you. This is Rosa Chen on for Roana Ruiz at Lering Partners. Just a couple from us. First on COVID. So thinking of all the various high-risk patients you're enrolling in Sunrise 3, which subpopulation do you think benifosavir can offer the most differentiated profile from currently available antivirals? And any thoughts on how you could leverage the data from the combination therapy arm?

Janet, would you like to address the question, please?

Sure. So I think with regard to the high-risk patient population, I mean, it's quite interesting. But I think in the last few months, there have been a couple of publications really showing that for the most high-risk patients, elderly, particularly I think those 75 and above, and those that are highly immunocompromised. And I think in that regard, particularly solid organ transplant patients, however many times they get vaccinated, it doesn't really seem to reduce their risk of getting severely ill when they do become infected with COVID. So I think these are the patient populations which are probably the ones where there is likely to be the greatest benefit. And I think another reason why ultimately, I mean, I think benifostavir would be an ideal drug for patients such as these, is that these are patient populations that are on multiple concomitant medications. And as Jean-Pierre mentioned, and as we've alluded to, I think the potential for drug interactions, particularly with protease inhibitors, is much higher than with nucleoside antagonists. And so I think these are the patient populations where frequently they're actually ineligible to receive a drug such as Paxlovid and have been in the past fortunate enough to have been able to receive monoclonal antibodies. But as you know, the monoclonal antibodies haven't been able to keep pace with the evolution of the virus. And then with regard to the combination group and what we're going to do there to educate ourselves, it's really most important, I think, because we have, as Jean-Pierre mentioned in his remarks, a protease inhibitor which is being developed and which we hope to show more information for later in the year. And so I think being able to see how combination therapy, and in particular, a protease inhibitor in combination with benifosterol is able to provide synergy and potentially reduce the various symptoms and allow patients to improve better. And also we're going to be looking at such things as drug interactions, viral load genetics, and safety and durability. I think all of that information is important in understanding how best to use these drugs and maximize them as we move further down the line. Thank you.

Thanks so much. And then on HCV, how should we think about the PK and efficacy of fenlithosavir and rusosavir in the patient population that actually has compensated cirrhosis compared to those without cirrhosis in your leading cohort? And then are you considering including patients with decompensated cirrhosis and also HIV co-infection in your phase three, so it's a similar, well, to pursue a similar label as EPCLUSA. And then separately, who are these low-hanging fruit patients that you could target if it's approved?

So, I'll answer.

Maybe you want to start to address the question, and then maybe a comment as well. So, I'll answer.

Yes. Well, I think the PK, we don't anticipate major changes. PK or even PKPD and viral kinetics, as you saw in the data that we have shown, the kinetics were very fast, even in the S3s, which are really borderline compensated serotics. So we think that, and we've seen also in previous trials, that the PK should be the same. That is for the compensated serotics. For the decompensated serotics, it's a great population. I think that we are going to target it. It's probably a little bit later. For the HIV, certainly we are considering inclusion in phase three trials. It's, like you said, a great unmet need population.

Yeah, no, actually. just one comment for the decompensated patient. Obviously, that would be, we believe, a major advance because we foresee, at least we see the potential to eliminate ribavirin, which right now you have only one approved treatment, which is a combination of Apclusa and ribavirin in those patients. Now, let's not forget that this is a patient population that is very difficult, very likely in trial, you're going to have some deaths. So obviously, we foresee that this population will be very likely not part of the phase three program unless the regulatory authorities will request that, but more as opposed to NDA commitment. But definitely, we definitely want to go there. Maybe not with eight weeks, probably a 12-week would be already highly differentiated with the elimination of ribavirin. And obviously, these patients do require the best chance of success, and that the lengths of treatment are less of an importance than what we have with the patient population that

I want to just share with you before.

Got it. Thanks so much for taking our questions. Thank you. You're welcome.

I would now like to turn the conference back to Jean-Pierre for closing remarks.

Thank you all for joining our first quarter and full year 2023 earning conference call, and thank you as well for your continued support.

Ladies and gentlemen this concludes today's conference. You may now disconnect. you Thank you. Thank you. Bye. Good afternoon, everyone, and welcome to the ITEA Pharmaceuticals 4th Corner 2023 Financial Results and Business Update 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 ITEA Pharmaceuticals. Ms. Barnes, please proceed.

Good afternoon, everyone, and welcome to Atea Pharmaceutical's fourth quarter and full year 2023 financial results and business update conference call. Earlier today, 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.ateafarma.com. With me today from Atea are our Chief Executive Officer and Founder, Dr. John Pierce Amadosi, Dr. Aran Shahorga, Chief Medical Officer, Chief Development Officer, Dr. Janet Hammons, Chief Financial Officer and Executive Vice President of Legal, Andrea Corcoran, and our Chief Commercial Officer, John Babrita. They will all be available for the Q&A portion of today's call. Before we begin the call, and 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 risk 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.

Thank you, Jonette. Good afternoon, everyone, and thank you for joining us. I will begin on slide three. Looking back at our substantial progress throughout 2023, I'm proud of the strong operational execution we achieved across our antiviral programs. The 2023 highlights from our COVID-19 program include the ability to leverage global surges to meaningfully advance our Phase III, Sunrise III study. This was made possible by the expansion of the global footprint and the broadening of the eligibility criteria for high-risk patients. So far in 2024, we continue to observe encouraging enrollment trends for Sunrise Threat. Reflecting the continuing unmet medical need, we were granted fast-track designation by the FDA for the evaluation of Beniclasovir for COVID-19. We have continued to demonstrate that Benifazovir remained fully active against all variants tested in vitro, including the newest sub-variants related to the O-micron. The profile for Benifazovir is supported by robust clinical data, including favorable efficacy and safety, with no drug-drug interaction. We believe that Benifazovir has the potential to address the key limitations of current COVID-19 oral therapies. For HCV, the 2023 highlights include achieving regulatory approvals of a short eight-week treatment for the global phase two trial of the combination of Benifazivir and Rizazivir for the treatment of HCV. The rapid enrollment of the leading cohort, which has led to exciting SVR results that we will review today. We demonstrated in vitro synergy of the combination of Benifazovir and Resesvir and the comparing potency profile against major HCV resistance mutations. We are now evaluating several fixed-dose combination tablets in preparation for the Phase III program and subsequent commercialization. And we presented and published preclinical and clinical data in support of this program. We believe Benifazivir in combination with Rizosvir can significantly improve upon the current standard of care by offering a differentiated short eight weeks protease inhibitor free treatment which has been well tolerated and has limited potential for drug-drug interactions. Moving to slide four. ATEA vision is focused on the discovery and development of antiviral drugs for the treatment and cure of serious viral diseases where there is a significant unmet medical need and where we can make a huge difference. As you know, we believe that COVID is here to stay. And the recent winter surge reminds us that new dominant variants like GN1 are striving despite the latest vaccine booster and treatments. The SARS-CoV-2 virus is accumulating mutations with amino acid substitutions faster than any other endemic RNA virus, highlighting the desperate need for a broader and more diversified arsenal of safe, well tolerated, and easy to prescribe oral antiviral therapeutics. Our team continues to efficiently execute our global phase three trial, and I'm very pleased to announce today that we have achieved another significant clinical milestone and surpassed enrollment of 1,400 patients, triggering our second interim analysis in the supportive care monotherapy cohort. This is an important milestone. allowing for the data review by the independent DSMB for safety and fertility. For Sunrise 3, we anticipate several upcoming events, including the first interim analysis in March, the second interim analysis in the second quarter of 2024, and top-line results during the second half of 2024. Benifaz has the potential to address many of the key limitations of curing COVID-19 therapies, including safety, durability, and drug-drug interactions. Our goal is to deliver best-in-class treatment to the millions of patients for whom the current standard of care is suboptimal or unsuitable. As part of a multi-pronged approach against COVID-19, We continue to also make progress with our discovery program focused on a highly differentiated second-generation protease inhibitor, and we expect to provide an update mid-year. For our Phase II HCV program, as stated earlier, we share new results with confirmed and 98% SVR4 post-treatment in the leading cohort of our Phase II combination. eight-week study. Arantza will review these results in more details. Our goal for this program is to substantially enhance the current set of care by offering a short eight-week protease inhibitor-free treatment that is well tolerated with low potential risk for drug-drug interaction for all HCV patients. Importantly, We are in a strong financial position to execute our strategy with $578.1 million of cash and cash equivalents as of December 31st, with a runway anticipated through 2026. Andrea will provide a detailed update on Atea's financial position during today's call. I will now turn the call over to Arentza for an update on our HCV program.

Thank you, Jean-Pierre. Turning to slide six, despite current treatment options, HCV continues to be a health crisis in the U.S. As Jean-Pierre noted earlier, there are approximately 2.4 million people infected with HCV in the U.S. despite availability of oral treatments. Recent trends indicate there are more new infections and reinfections than cures on a yearly basis. And these statistics highlight the need to improve the HCV treatment landscape. The combination of benifosovir and busavir has the potential to substantially improve upon the current standard of care by offering a short eight-week protease inhibitor-free treatment with less side effects and a low risk for drug-drug interactions. Based on our market research with KOLs and high prescribers, These attributes are very critical for a new treatment, as you will see on the next slide. Moving to slide seven, while the introduction of direct-acting antivirals has transformed HCV treatment, significant unmet needs still exist. In recent quantitative market research conducted by Atea, with over 150 U.S. physicians who are high prescribers of Eclusa or Maviret, Only 6% of these physicians reported that there are no unmet needs regarding HCV treatment. Key unmet needs emerging in this research were shorter lengths of treatment and higher efficacy, particularly in HIV-co-infected patients, as well as fewer contraindications as detailed on the right hand of the slide. Please note that currently approximately 17% of patients do not complete their treatment regimen, making convenient and shorter treatment durations of particular importance to prescribers. Slide 8 outlines our Phase II open-label study of 550 mg of benifosfovir in combination with 180 mg of rusesvir once daily for 8 weeks. We plan to enroll up to 280 DAA-naive patients across all genotypes. In the initial cohort, sustained biological response, or SBR, at week four was used as the decision criteria to reinitiate enrollment to complete the phase two study. The primary endpoint of this study is SBR at week 12, and this will be reported for all patients at study completion. Slide nine highlights the patient demographics and baseline characteristics in the leading cohort of the phase two open-label study of benifosfovir and rusosvir. The patients were DNI is a median age of 47 years old. This cohort was comprised of non-cirrhotic patients only. However, please note that 10 patients had fibrosis stage of S3 and were advanced liver disease stage which is borderline with cirrhosis. In the second part of the phase two study, compensated cirrhotic patients will also be enrolled. Moving to slide 10, we are excited to share with you today that the final results from the phase two combination study in the leading cohort confirmed an SBR4 of 98% post-treatment across all genotypes. In January, we reinitiated enrollment to complete the study in up to 280 patients with top-line results anticipated in the second half of 2024. Seven shows the on-treatment viral kinetics of individual patient data. By week four, all 60 patients in this cohort had viral load near or below the lower limit of quantification. Therefore, this very rapid kinetics across all genotypes, support an eight-week regimen, and compare favorably to the only approved eight-week treatment for HCV. On slide 12, the combination of Benifosavir and Rusavir was generally safe and well-tolerated in this cohort of 60 patients. There were no drug-related serious adverse events, no discontinuation, and adverse events were mostly mild. Turning to slide 13, to summarize our progress in HCV, based on the positive leading cohort data, we reinitiated enrollment in January for the remainder of the Phase II trial. To help advance enrollment and achieve representative genotype distribution, we are increasing this study's footprint to approximately 50 clinical sites in 15 countries. In addition, over the first half of 2024, we are conducting phase one studies in the US for the selection of the fixed-dose combination tablet, which will be evaluated in the phase three program and used for subsequent commercialization. We anticipate that the phase three program will be initiated around the end of this year. Slide 14. Next, we will provide an update on our COVID-19 program I'll turn the call over to Janet to discuss our Sunrise III Phase III trial.

Thanks, Arantia. Good afternoon, everyone. COVID-19 continues to be an established pathogen of concern, according to the World Health Organization. And we believe that COVID-19 will remain an ongoing, serious endemic issue. Our goal for COVID-19 is to deliver a safe and effective treatment to millions of patients for whom the current standard of care is not a suitable option. We believe that the compelling preclinical and clinical profile of Benifosbuvir is differentiated with a low risk for drug-drug interactions, a favorable tolerability, and a high barrier to resistance, and has the potential to become the treatment of choice for COVID-19 for millions of patients. Moving to slide 16. Supported by our extensive global footprint, we are seeing robust enrollment into Sunrise 3, and patient enrollment has correlated with the latest winter wave. In particular, we've experienced strong enrollment in the U.S., where sites have been responsible for approximately 75% of the patients enrolled to date. The majority of patients globally continue to be enrolled in the monotherapy cohort, despite the availability of other oral antivirals. We're excited to share with you today that Sunrise reached the past enrollment of 1,400 patients in the monotherapy cohort, triggering the second interim analysis. The DSMB is expected to meet in March for the first interim analysis, and we expect the second interim analysis to occur during the second quarter. Just to remind you, the DSMB reviews are primarily geared towards safety and futility. So far this winter, as predicted by the US CDC, respiratory diseases are showing similar high trends to last year. The patients most vulnerable to severe COVID infection remain the elderly, the immunocompromised, and those with underlying risk factors for severe infection. But oral therapeutics are of critical importance to protect against hospitalization and complications. Turning to slide 17. I'll now go into detail on our summarized three global phase three trials. To start, our inclusion criteria focus on high-risk outpatients with mild or moderate COVID-19, regardless of vaccination status. Symptom onset is five or less days before randomization. The phase three study is randomized, double-blind, and placebo-controlled. The study drug either Benifosbuvir 550 mg BID or placebo is administered concurrently with the locally available standard of care. There are two study populations depending on the type of standard of care received. The supportive care monotherapy cohort comprises the primary analysis population. While the combination cohort is part of the secondary analysis, and includes patients treated with local standard of care, including other compatible COVID-19 antiviral drugs. The primary endpoint to the study is all-cause hospitalization or death through day 29 in the supportive care monotherapy population, which will be approximately 2,200 patients. The secondary endpoints are COVID-19 related hospitalizations and deaths, medically attended visits, and symptom rehab. Last year, we were granted fast-track designation for Benefoscivia, reflecting the recognized unmet medical need that remains for COVID-19 patients. Overall, we're seeing strong operational execution for Sunrise 3 from our clinical team with robust enrollment trends. I'm now going to hand the call over to John to discuss the marketing opportunity for Benefoscivia. John?

Thank you, Janet. Turning to slide 19. We know that the U.S. prescription demand for oral antivirals to treat COVID correlates with the infection rates. The demand for oral antivirals in 2023 was very robust with a total of approximately 7.7 million scripts written. Last month, the scripts were approximately 920,000, which reflects the latest winter surge. On the next slide, slide 20, late last year, the market for COVID-19 oral antivirals began transitioning to traditional payer markets such as Medicare, Medicaid, and private commercial insurance. Oral antivirals therapeutics for COVID-19 are expected to remain a multibillion-dollar opportunity for years to come. Projected annual COVID-19 oral antiviral U.S. demand using IQVIA retail prescriptions suggests an estimated annual global market opportunity of over $4 to $5 billion, with only two products that each have key limitations We believe there is still an unmet need with critical gaps, and there is the opportunity to expand this market to patients due to drug-drug interactions and tolerability with Paxlovid and safety issues with Lecavrio. I'll now turn the call over to Andrea to discuss the TEAS financials.

Thank you, John. As Joneigh mentioned, earlier this afternoon, we issued a press release containing our financial results for the fourth quarter and full year 2023. The statement of operations and balance sheet are on slides 22 and 23. There was an increase in R&D expense for the fourth quarter and full year 2023 versus the corresponding period in 2022. The primary driver for the higher expense was the external expense related to our COVID-19 Phase III Sunrise. three clinical trials, and our phase two clinical trial of a combination of benifostavir and rusavir for the treatment of hepatitis C. General and administrative expenses remained relatively flat for the fourth quarter and full year versus the corresponding period in 2022. Interest income increased for the fourth quarter and full year 2023 versus the corresponding period in 2022. This was the result of investing in higher yield marketable securities and higher interest rates. At the end of the fourth quarter of 2023, our cash, cash equivalent, and marketable securities balance, as Jean-Pierre mentioned, was $578.1 million. Based on our current plans, we are reiterating our cash guidance with a runway through 2026. I'll now turn the call back over to Jean-Pierre for closing remarks.

Thank you, Andrea. In closing, following a year of solid operational execution across our two clinical programs. Our clinical momentum set us up for a transformational milestone-rich 2024 for both our COVID-19 and HCV program. For COVID-19, we anticipate meaningful clinical milestones beginning in the first quarter of 2024 with the first interim analysis from our global phase three trial. followed by a second interim analysis in the second quarter of 2024. Top log results as expected in the second half of 2024. For HCV, we anticipate completing enrollment of our phase two study and reporting results during the second half of 2024. We have continued to target initiation of a phase three around the end of the year, and we are extremely encouraged by the SVR4 and safety results in the leading cohort. We are targeting multi-billion dollar markets, each of which are currently comprised of only two primary products. We believe that our product candidates are very differentiated and have the opportunity, if approved, to fill the gap in the current unmet medical needs and become blockbuster products. We are very excited about the opportunities ahead and are confident in our ability to develop and commercialize innovative products and create meaningful shareholder value. In particular, I'm very proud of the team hard work throughout the year, It's a company with less than 80 employees, which is conducting two global studies in disease with multi-billion dollar market opportunities, with a high degree of efficiency, as well as with significant financial discipline. With that, I will turn the call back over to the operator.

Certainly. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. And one moment for our first question. And our first question will come from Eric Joseph of JPMorgan. Your line is open, Eric.

No, thank you. And thanks for taking the questions. A couple from us. Just on the sizable accrual in patients for Sunrise 3, do you have visibility in terms of, I guess, how those are apportioned across the different study arms, monotherapy versus combo. I guess, what visibility do you have in terms of percent to enrollment completion of the monotherapy primary analysis population? And on the HCV side, just picking up on a comment you made, JP, about potentially being a non-HCV protease-based inhibitor option. What's the significance of that? Is there sort of a safety advantage that you'd highlight, or is it more about just being an alternative mechanism compared to the other commercially available eight-week regimen? Thanks.

Thank you, Eric. There is definitely an importance in the differentiation. But let's start with the COVID-19 questions. Great question. Janet, you want to give a little bit some... granularity to Eric?

Thank you, Eric, for the question. So in regard to how the patients are apportioned to the combination versus monotherapy, I mean, obviously, first of all, just to say that this is at the discretion of the investigator and prescriber who sees the patient, and they are encouraged to prescribe combination therapy if they believe that is appropriate for the patient. And are actually educated quite extensively at our investigation meetings in that regard. And what I think is quite surprising is that the vast majority of patients are actually being assigned to the monotherapy arm. And I think reasons for this probably are really the extensive potential for drug interactions associated with ritonavir in the Paxlovid combination treatment, which I think and deters people from prescribing combination therapy to patients. And then in regards to your question around if we have any visibility as to when we might complete accrual in the monotherapy arm, no, we don't. But I can say that enrollment is proceeding well. But of course, we're very dependent on the fluctuations in COVID cases as they occur. We've seen a very strong winter season. Frequently, I think, at least in the past, we've observed that that's followed by some downward trend in the number of cases until we get towards the hotter summer months when people move indoors again. So we're somewhat dependent on that. We'll have to see. Thank you.

So related to the HCV questions, I think with the survey from a third party, it really exemplified the importance of a lack of protease inhibitor in the combination treatment, especially when we are talking about about 40% of HIV-infected patients with HCV, where you're going to have substantial drug-drug interaction if you have a protease inhibitor. So it is an important differentiation. John, you want to maybe also expand on that and really... This is not just a gimmick here that we are talking about. It's really important from a commercial standpoint, and then I will ask a answer from a patient standpoint. John, do you want to address that from a commercial standpoint?

Sure. So, Eric, from a commercial standpoint, obviously being ProteA3 is really important to us for the low, low drug DDI interaction potential. And also, there's also other advantages, such as having a no food effect, and also to be able to treat with a shorter treatment duration. Particularly important, because as Arantxa mentioned earlier in the presentation, what clinicians are finding is that the shorter time to treat is the better. And to highlight this about, you know, Maviret has obviously a protease inhibitor. And when you look at the new Rx market shares, even despite being eight weeks versus 12, there's almost a little bit more than a 10-point share difference in favor of occlusal. And so that should maybe also tell us some things as well.

Our answer from a patient standpoint, I'll tell you, discussion with K1 and prescriber. Go ahead.

Yes. So from a medical perspective, I think what we're trying to develop here is really a best-in-class regimen that combines the best of Abclusa and the best of Maviret in the sense that it's an eight-week regimen. And without the drug-drug interactions, that are actually quite common that Maviret and protease inhibitors have as a class. And these are common drugs. We're talking about things like contraceptives, antiretroviral therapies, statins, proton pump inhibitors, which, you know, almost everybody over 40 is on something like that. So this is very important for the patients, as the market research has indicated, but also when we talk to the KOLs on the field and when they were actually trying to review our protocol and participate in our clinical trial, all of them were very excited that we could actually develop this best-in-class regimen, bringing the best of both attributes of both regimens.

Thank you, Aretha.

And one moment for our next question.

And our next question will be coming from Maxwell Score of Morgan Stanley. Your line is open, Maxwell.

Great. Thank you for taking my questions. Given your strong financial position, I was hoping you can elaborate a bit on your capital allocation strategy and how you're preparing for a potential launch in COVID. while advancing your global HCV program? Basically, how should we think about spend over the next several quarters? Thank you.

Andre, you want to address that question? Maybe just I'd like to indicate that for the launch, we have actually supply. We are fortunate to have to get an approval in any way. But we will not do substantial investment in manufacturing at risk prior to approval. So we will provide additional information as we get closer to launch. So with that, in parenthesis, Andrea?

Yes, thank you, Jean-Pierre, and thanks, Max, for the question. So I think as you've seen or will see when you have the chance to review the financial statements, You know, we continue to exercise really discipline in our investments for both the COVID-19 program as well as the HEPC program. Expenses are increasing, but in a very measured way, quarter over quarter for 2023. We would expect the same type of limited increase in 2024. The phase three program for COVID will begin to wind down before the phase three begins for HEPC. But nonetheless, we will be preparing for commercialization, as you said, so there will be additional activities that we will be funding at that point. So the expenses for 24 and 25 are expected to increase, but in a very measured way.

Great. Thank you.

And one moment for our next question. And our next question will be coming from John Miller of Evercore ISI.

Your line's open, John.

Hi, this is Jessica on for John Miller. Thanks for taking our questions. I have two questions, if I may. One on COVID, one on the Hep C front. So for COVID, so you said Sunrise 3 top line data expected in second half of the year. So how should we think about the various scenarios that can occur? How well does the market appreciate that preexisting immunity from infection and or vaccination can affect placebo rates, possibly making the effect size smaller. And maybe a direct comp to Paxlova trial data may be limited. And then also worst case scenario, how should we think about the company direction in the bear case scenario that the primary endpoint is not met? And then I have a follow-up question. Thank you.

Janet, would you like to address the question, please?

Thank you, Jessica. So, yes, I think everybody realizes that with vaccination and prior exposure to COVID-19, the severity of the disease is frequently less severe, fortunately, than it was when we were going through, in particular, I think the Delta wave and hospitalizations are at an all-time high. Our study is designed, though, to show a Delta in efficacy comparable So I think what Pfizer most recently reported in their outpatient study where there was about a 50% or in the 50s difference between the active and the placebo groups. And so that's what we're expecting to see. I think particularly when you're talking about high-risk patients and hospitalizations, that is still an important and meaningful difference. And of course, hospitalization and death are the worst outcomes. And so if one can prevent those and reduce the severity of disease. I think that's going to be really important.

Oh, go ahead, Jen. Sorry, go ahead.

No, I was just going to ask you if you wanted to follow on with Jessica's other question around the scenario where we fail to achieve a primary endpoint.

Yes, go ahead.

Okay, so... I think, I mean, certainly, I mean, it's one of those things that is under consideration is, you know, if we're unable to do that, are there further avenues to pursue in terms of looking for trends? And we have a fast track designation with FDA to assess how to proceed. But we also have, as I think has been mentioned, two interim analyses. where the DSMB will help us to make the decision not to proceed should we see that no number of patients in what we are projecting would allow us to be successful. So I think those are the scenarios that we're certainly aware of and thinking about. But at the moment, things are moving forward well, and we look forward to presenting results and allowing you to update as we move forward.

Thank you, Janet. Just what I wanted to add to the first question is I think it's very telling that the NIH actually recently reported that only 15% of high-risk actually are taking Paxlovid. And actually, so 85% of high-risk who should get an oral therapeutic don't. Well, very likely many of the reasons of the limitation of PaxLavit. So you can see that there is a huge opportunity here for a best-in-class product, including even with the challenges that we face. As Janet and Jessica, you recognize in terms of number of low events, but we believe that the way this study has been built will maximize the results for the efficacy and safety of this drug. So I understand you may have another question on HCV as well?

Yes, thank you. So on the Hep C program, given the context that compliance with existing therapies is lacking with existing regimens, so there's an unmet need here, and the patients you're presumably going after are the ones that we know already are bad at compliance or else they'd be cured already. How do you guys plan to ensure for the Phase 3 that the protocol and clinical sites can optimize good drug adherence, especially since we've already seen that one patient in Phase 2 with poor adherence who is thus unable to achieve SVR4?

That's a great question, Jessica. Arentha, we spent quite some time on that. So, Arentha, would you like to address the question?

Yes, it is a great question. I think, you know, in part, the compliance issues are just part of the nature of doing trials right now in hepatitis C. The population that we have that is in high need right now is a bit of a mix of the patients who are not taking drugs and they are just general patients, but also there is a very large population of patients that are ex-IV drug users or IV drug users And those really benefit from short treatment durations. So I think by offering a short treatment duration, you're already addressing some of the compliance issues because, you know, patients in general are very excited to take drugs at the beginning, but then, you know, sometimes they forget towards the end of the treatment. I think we have all experienced that. So the eight-week duration already helps. We, of course, have, you know, the regular measurements of, you know, checking with the patients, calling them, bringing them in. And very important in phase three is that we're going to have a comparator. So the issues with compliance will affect both arms equally because the patients are randomized. And there you're really going to see how the comparator is behaving in today's kind of population, which includes these patients that are, you know, noncompliant in general.

And obviously, we will... you finalize any protocol with the regulatory authorities. But based on our initial interaction, it's clear that a comparator is required for our phase three program.

Thank you very much. And one moment for our next question. And our next question will be coming from Roana Ruiz of Lering Partners. Your line is open.

Thank you. This is Rosa Chen on for Roana Ruiz at Lering Partners. Just a couple from us. First on COVID. So thinking of all the various high-risk patients you're enrolling in Sunrise 3, which subpopulation do you think benifosavir can offer the most differentiated profile from currently available antivirals? And any thoughts on how you could leverage the data from the combination therapy arm?

Gentlemen, would you like to address the question, please?

Sure. So I think with regard to the high-risk patient population, I mean, it's quite interesting. But I think in the last few months, there have been a couple of publications really showing that for the most high-risk patients, elderly, particularly I think those 75 and above, and those that are highly immunocompromised. And I think in that regard, particularly solid organ transplant patients, however many times they get vaccinated, it doesn't really seem to reduce their risk of getting severely ill when they do become infected with COVID. So I think these are the patient populations which are probably the ones where there is likely to be the greatest benefit. And I think another reason why ultimately, I mean, I think benifostavir would be an ideal drug for patients such as these, is that these are patient populations that are on multiple concomitant medications. And as Jean-Pierre mentioned, and as we've alluded to, I think the potential for drug interactions, particularly with protease inhibitors, is much higher than with nucleoside antagonists. And so I think these are the patient populations where frequently they're actually ineligible to receive a drug such as Paxlovid and have been in the past fortunate enough to have been able to receive monoclonal antibodies. But as you know, the monoclonal antibodies haven't been able to keep pace with the evolution of the virus. And then with regard to the combination group and what we're going to do there to educate ourselves, it's really most important, I think, because we have, as Jean-Pierre mentioned in his remarks, a protease inhibitor which is being developed and which we hope to show more information for later in the year. And so I think being able to see how combination therapy, and in particular, a protease inhibitor in combination with benifosterol is able to provide synergy and potentially reduce the various symptoms and allow patients to improve better. And also we're going to be looking at such things as drug interactions, viral load kinetics, and safety and durability. I think all of that information is important in understanding how best to use these drugs and maximize them as we move further down the line. Thank you.

Thanks so much. And then on HCV, how should we think about the PK and efficacy of femisofovir and rusosvir in the patient population that actually has compensated cirrhosis compared to those without cirrhosis in your lead-in cohort? And then are you considering including patients with decompensated cirrhosis and also HIV co-infection in your phase three, so it's a similar, well, to pursue a similar label as EPCLUSA. And then separately, who are these low-hanging fruit patients that you could target if it's approved?

So, Arantza, maybe you want to start to address the question, and then maybe a comment as well. So, Arantza.

Yes, well, I think the PK, we don't anticipate major changes, PK or even PKPD and viral kinetics. As you saw in the data that we have shown, the kinetics were very fast, even in the S3s, which are really borderline compensated serotics. So we think that, and we've seen also in previous trials, that the PK should be the same. That is for the compensated serotics. For the decompensated serotics, it's a great population. I think that we are going to target it. It's probably a little bit later. For the HIV, certainly we are considering inclusion in phase three trials. It's, like you said, a great unmet need population.

Yeah, no, actually, just one comment for the decompensated patient. Obviously, that would be, we believe, a major advance because we foresee, at least we see the potential to eliminate ribavirin, which right now you have only one approved treatment, which is a combination of Epcluse and ribavirin in those patients. Now, let's not forget that this is a patient population that is very difficult, very likely in trial, you're going to have some deaths. So obviously, we foresee that this population will be very likely not part of the phase three program unless the regulatory authorities will request that, but more as opposed to NDA commitment. But definitely, we definitely want to go there. Maybe not with eight weeks, probably a 12-week would be already highly differentiated with the elimination of ribavirin. And obviously, these patients do require the best chance of success, and that the lengths of treatment are less of an importance than what we have with the patient population that

I went to just share with you before.

Got it. Thanks so much for taking our questions. Thank you. You're welcome.

I would now like to turn the conference back to Jean-Pierre for closing remarks.

Thank you all for joining our first quarter and full year 2023 earning conference call. And thank you as well for your continued support.

Ladies and gentlemen, this concludes today's conference. You may now disconnect.