Axcella Health Inc.

Good morning, ladies and gentlemen, and welcome to Excellus' third quarter 2020 conference call. Please be advised that today's conference is being recorded and that all participants will be in a listen-only mode until the question and answer session. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touch-tone phone. To withdraw your question, please press star then two. And now for opening remarks, I would now like to hand the call over to Jason Fredette, Vice President of Investor Relations and Corporate Communications at Accela. Please go ahead, sir.

Thank you, Operator, and thanks to everyone who's tuning in this morning. We would like to advise that certain remarks we will make on today's conference calls, such as those relating to our planned IND submissions and clinical trials, include forward-looking statements that are subject to various risks and uncertainties. These risks and uncertainties are detailed in our Form 10-Q for the most recent quarter. and our other SEC filings, which can be accessed on our website, AccelaHealth.com, or on the SEC's website. All forward-looking statements represent our views as of today, November 12, 2020, and should not be relied upon as representing our views as of any subsequent date. We undertake no obligation to update these forward-looking statements. Please also note that the data we will reference on today's call stem from non-IND clinical studies that were designed to evaluate product candidates for safety, tolerability, and effects on normal biological structures and function. These studies were not designed or intended to evaluate the ability to treat or prevent diseases. Our next clinical trials of ACSA 1125 and ACSA 1665 will be aimed at this goal. On the call with me today are Accela's President and CEO, Bill Hinshaw, our Chief Financial Officer, Laurent Chardonnay, and Chief Medical Officer, Dr. Manu Chakrabarty. I'll now turn the call over to Bill to kick off our discussion. Bill?

Thank you, Jason, and good morning, everyone. We appreciate you joining us today. 2020 as a whole has been a period of significant advancement and validation for Accela, and we're excited to share the most recent and important examples of this on today's call. I will update you this morning on each of our three clinical stage programs, including some key details on our upcoming trials in NASH and overt hepatic encephalopathy, or OHE. And Laurent will follow up with a brief recap of our financials. We'll then be happy to take your questions. Before diving into the program specifics, I would first like to ground you on our aim here at Accela. Our platform focuses on the use of endogenous metabolic modulators, or EMMs, specifically amino acids and their derivatives. Leveraging these master regulators and signaling agents, we've compiled a portfolio of multi-targeted product candidates that hold transformational potential, working with the body systems to tackle complex diseases such as NASH and OHE. In September, we were pleased to announce the publication of a manuscript in iScience that was lead authored by Accela's head of research, Mike Hamill. This paper elucidated the fundamental role that amino acids play in biology, and it included many clinical precedents from others who have used single amino acids in simple combinations to treat diseases. The manuscript also explains how Accela is approaching things differently. We are developing compositions of multiple EMMs that have the potential to address complex diseases in a more comprehensive manner than a single targeted small molecule or biologic. And since these EMMs are, of course, endogenous to all of us, they have well-established safety and tolerability. As a result, we and many of the key opinion leaders we have spoken with believe our candidates are well-positioned to be used chronically by both adults and children and to be used in combination with other agents as required. Our two lead candidates are in the liver space, AXA 1125 for NASH and AXA 1665 for OHE. Let's begin with 1125, which is our multi-targeted product candidate for NASH. Following the readout from our successful 1125-003 clinical study, which was presented as a late breaker at EASL, we recently engaged with the FDA and completed a Type B pre-IND meeting. We are very pleased to report that this engagement allowed us to affirm our plan to proceed directly into a Phase IIb clinical trial in biopsy-confirmed adult NASH patients. The agency confirmed that based on the significant amount of safety information and human data we have already generated, we will be able to get this trial underway in a streamlined fashion without additional toxicology work. As I mentioned, this engagement followed top-line data from our 003 clinical study earlier this year, in which 1125 showed meaningful and concordant reductions in virtually all noninvasive biomarkers, measuring metabolism, inflammation, and fibrosis through 16 weeks in the overall population. And even greater effects were noted in subjects with type 2 diabetes. Also, a meaningful proportion of subjects achieved thresholds of activity in markers that have been shown to correlate with histological outcomes. Since we target all three biologies in this disease and various underlying pathways simultaneously, we believe there's a potential for even more profound benefits beyond 16 weeks. Additionally, 1125 was well tolerated and no changes were seen in weight or lipids. This is of particular importance given the profiles of other mechanisms in the NASH space and the fact that the typical NASH patient is already on five to seven medications. The potential to treat patients without additional interventions and complications is an important consideration for a first-line therapy. We are gratified that these data were selected as an easel late breaker, and we're looking forward to our two poster presentations at ASLD, which kicks off tomorrow. One of these presentations will focus on the greater magnitude of effect that was seen among subjects with type 2 diabetes in our 003 study. This is a potentially differentiating feature of 1125 in a large subpopulation that we'll investigate further in our Phase IIb. We are now in the process of preparing an IND submission, and we'll provide the full trial details once it's accepted. However, we are happy to share with you our thinking at this stage in terms of the Phase IIb trial design. It is expected to include a 48-week dosing period, two active arms versus placebo, standard histological and non-invasive endpoints. We will again be stratifying by patients with and without type 2 diabetes to further inform our development plans. The trial is expected to include an interim analysis, and we look forward to getting it underway in the first half of 2021. We believe IND acceptance and the trial initiation will demonstrate a few key advantages of Accela's differentiated approach. Firstly, unlike most Phase I IND opening trials, we are proceeding directly into Phase IIb. Secondly, we'll be getting into this phase just four years after designing ACTSA 1125, cutting the standard drug development timeline nearly in half. And finally, and most importantly, we'll be entering this next stage with far more human data than would normally be expected, helping to de-risk our Phase IIb trial. So to summarize around 1125, we believe this candidate is positioned strongly in the NASH space as a potential first-line treatment based on the following. The effects we have seen in just 16 weeks in a meaningful percentage of subjects. Its favorable safety and tolerability to date. the benign lipid profile, and lack of effect on weight, its oral route of administration, and its modality that works with the body systems. These same attributes also make 1125 an appealing candidate to consider utilizing in combination with other agents when needed, and we believe it is also very well suited for early investigation in the burgeoning pediatric NASH populations. Now let's move on to another important liver disease, Anaxa 1665. Accel is product candidate for the prevention of recurrent OHE. OHE is a manifestation of cirrhosis in which patients are severely cognitively impaired to the point where they're unable to care for themselves and may ultimately become comatose. It's estimated about a third of cirrhotic patients experience at least one OHE event during the course of their disease. and many of these patients experience repeated events, even while on today's approved medicine, namely, Lachlose and Rifaximin. We believe that this is because these agents focus on only one of the disease drivers, namely, elevated ammonia, and also because tolerability is a challenge and thus compliance is limited. The reality is that OHE involves a vicious cycle in which amino acids become imbalanced, ammonia levels increase, and muscle tries to process the ammonia, but it does it poorly. This then exacerbates muscle wasting and ammonia elevations. The cycle ultimately leads to neurocognitive impairment and OHE events. 1665 holds the potential to improve the standard of care by addressing this disease more comprehensively. In August, results from our initial clinical investigation of 1665 were published in Clinical and Translational Gastroenterology. And that same month, we were excited to share the top-line data from our latest clinical study, AXA 1665002. This placebo-controlled study enrolled 60 subjects, and baseline characteristics were consistent with a population with mild hepatic insufficiency, and subjects were mostly non-sarcopenic. 1665 was again safe and very well tolerated. Encouragingly, we also saw dose-dependent activity across all measures of amino acid balance and neurocognition. In fact, for the high dose versus placebo, we saw sustained and statistically significant improvement in the Fisher ratio, which is a measure of branch chain amino acids over aromatic amino acids, has been shown to correlate with outcomes. And we saw statistically significant improvement in the PHES, which is considered the gold standard for diagnosing minimal hepatic encephalopathy. In fact, even in this population with mostly mild hepatic insufficiency, the majority of subjects receiving the high dose of 1665 achieved a placebo-adjusted two-point improvement in the PHES score. This is a clinically relevant change that is in the range of other approved therapies in the HE field. Plasma ammonia also tended to decline in subjects with minimal hepatic encephalopathy. And finally, a greater proportion of subjects in the active arms versus placebo tended to show an improvement in muscle function as measured by the liver frailty index. These results and our past interactions with the FDA regarding 1665 provide us with confidence and excitement as we prepare our IND submission and design our planned Phase II clinical trial. We are now able to share some initial details of the trial. Our Phase II is expected to be a placebo-controlled six-month trial that enrolls cirrhotic patients to have experienced at least one prior OHE event. And since we already have investigated four doses of 1665 in prior clinical studies, we believe it may be more streamlined in terms of the number of arms. Similar to 1125, we plan to share further details once our IND is accepted, and then get the phase two underway in the first half of 2021. Now that we've covered our liver programs, Let's shift to another clinical stage product candidate, 4010, in the hematology space. 4010 is currently being investigated in an initial non-IMD clinical study enrolling subjects with sickle cell disease. This candidate was designed to target multiple pathways involved in red blood cell metabolism, vascular function, and inflammation. The Bayesian design of our 001 study enables us to efficiently investigate a first cohort of subjects to determine if 4010 is safe and well-tolerated and if it appears to be influencing the targeted biologies. We completed enrollment of this first cohort a few months ago and will receive data on these subjects in December. If we see results consistent with impact on biologies and appropriate safety, we will proceed with the enrollment of two additional cohorts, one in adults and the other in adolescents with sickle cell disease. We expect to report back to you on our decision to enroll additional subjects by early 2021. We certainly have a great deal of work in front of us, and our excitement continues to build as we approach important milestones for Accela and for its shareholders. Now, let me turn the call over to our CFO, Laurent Chardonnay, to review our financials for the third quarter. Laurent?

Thank you, Bill, and good morning, everyone. As Bill mentioned, these past few months were very productive with multiple data readouts and the FDA's affirmation that we can proceed into Phase II clinical trials under IND. This morning, I will start my overview by discussing our cash position. We ended the third quarter with $170 million in cash and marketable securities, as compared to $92 million at the end of 2019. The increase is primarily the result of net proceeds from our full-on stock offering that was completed this past May and our thoughtful management of expenses. Our cash balance as of September 30th was sufficient to meet our operating needs well into 2022. We plan to provide more explicit cash flow and guidance following the completion of our trial designs and acceptance of our INDs in early 2021. Now, turning to our research and development expenses. With the steady advancement of our portfolio, we will continue to invest actively in our drug development program. Our research and development expenses were $7.5 million and $26.4 million for the three and nine months ended September 30th, 2020. This is down from $12.2 and $29.1 million for the same period of 2019. The decrease primarily due to the completion of our 1125-003 clinical study and the wind-down of costs for our 1665-002 clinical study. We are expecting that R&D costs will begin to increase again in the coming quarters as we prepare to enter later stage clinical trials. G&A expenses were $4.2 million and $12.9 million for the three and nine months ended September 30th, 2020. This is roughly flat with our $4.8 million and $13 million for the same period of 2019. We expect these expenses to remain unchanged in the near term. Accela net loss for the third quarter of 2020 was $12.4 million, or $0.34 per share. And our net loss for the nine months ended September 30th was $41.3 million, or $1.39 per share. Included in these net losses were 1.4 and 4.9 million, respectively, in non-cash expense related to stock-based compensation. So, with $170 million in cash in hand, we are very well positioned to continue to advance our pipeline. With that, operator, will you please open the line for questions?

Thank you. We will now begin the question and answer session. To ask a question, you may press star then 1 on your touch-tone phone. If you are using a speaker phone, please pick up your handset before pressing the keys. To withdraw your question, please press star then 2. At this time, we will pause momentarily to assemble our roster. And the first question will be from Yasmine Rahimi with Piper Sandler. Please go ahead.

Hi, team. Congrats on the continued progress you're making. A number of questions, one related to 1125 and 1665. So maybe let's get started on 1125. So the first question for you is directed on, can you give us a little bit of color on what you're going to be powering in terms of the histological endpoints? You see benefits both in national evolution and potentially fibrosis. So if you could shed light on the histological endpoint. would be important. Secondly, you pointed out that there will be an interim analysis that will be conducted. Can you tell us if the interim analysis would be the typical MRI, PDFF, or other non-invasive biomarkers, and what the size of the interim analysis would include? And then in regards to 1665, we would be very much interested in understanding what the primary endpoint of that study would be. And thank you again for taking our questions.

Great. Thanks, Yaz. Great to speak with you. This is Bill. And, yeah, we're very excited about the progress we've made here. In terms of your specific questions, what I'll share with you is this, is we plan to communicate specifics, and I'll say detailed specifics, on both of the protocols and trials post-IND acceptance, which we expect in the first half of 21 and then carrying forward into the study. What I can tell you on the two trials are some pretty detailed information. So let me start with 1125. The type of patients will be biopsy-confirmed NASH, and we're very excited that the agency, with the data that we generated, supported going into a 48-week dosing period in that paired biopsy study. The endpoints there are going to be standard NASH histological endpoints and noninvasive markers that you're used to seeing in a Phase II study. We're going to have the two active arms and a placebo. We are going to be looking likely in the low hundreds of patients in the trial. That will be finalized in the near term. And we expect to run the trial globally. And we'll share again additional details about that following IND acceptance, which is similar on the interim analysis. I know you guys would want all the details right now. We'll share that once the IND is accepted. We plan to look at interim analysis to help provide information for ourselves as well as a public update. And then in terms of 1665, we're in a position there where, again, we'll share the details beyond this at the acceptance of IND. Types of patients there are going to be at least one prior OHE event. So these are going to be patients who have more advanced liver disease. They'll be coming in on co-medications of Lachlos, or Lashless plus Rifaximin. We're looking at a six-month dosing period there. In terms of your question on endpoints, we expect those to include elements around PHES score, OHE events, and other outcomes while we'll finalize and communicate those post-IND acceptance. Here we're excited to submit and then follow up because on the number of arms, as you're familiar, we've already dosed four different dose regimens here. And we expect this to be a little more streamlined than typical in a Phase II trial. And then the number of patients, similarly, we plan to be in the low hundreds to be finalized. Similar approach on site selection and number of sites globally. And then additionally on the interim, we're examining an interim and or futility approach that's optimal for this patient population. And we will communicate, again, all the details upcoming in the first half when we both have the IND acceptance, which we're very excited about and confident in, and then move forward with the trials.

Thank you, Bill. Thanks for the caller.

Thank you.

And the next question will come from Michael Morabito with Chardon Capital Markets. Please go ahead.

Hi, Dean. Thanks for taking the questions. Can you please give us a little bit more color on what you plan to announce for each trial in the first half of next year between when you officially file the IMD versus when FDA accepts your IMD versus when you begin initiating enrollment of those trials, what you think that you might plan to announce for us. And secondly, on the Both trials, how many clinical sites do you anticipate enrolling in for each trial? And of those, how many do you expect have been previously used for your clinical studies?

Thanks, Michael, for your interest and your questions here. In terms of the approach on the announcement, we will certainly announce the acceptance of the IND, which is a fairly standard practice. In our case, as you're familiar, our IND opening is not typical. We're not going into an initial first in human study. We're going into a phase 2 and phase 2B study. So I outline that because we will definitely communicate the acceptance, and then we'll have the initiation of the trial. When patients are enrolled, we'll be will take longer than a, quote, typical IND opening setting because we have all of the normal screening process, et cetera, and we'll be communicating that appropriately with y'all. In terms of how many sites, again, we'll finalize that and communicate with that post the IND acceptance. We are planning on working with a number of the sites that we have collaborated with before, and we're very confident in our ability to continue a strong execution on that piece. And one of them, of course, that you're familiar with is Dr. Harrison and the Summit Network in 1125 who we continue to collaborate with in this setting. So we're very excited as are the opinion leaders both with NASH because they see the profile of this agent as a potential differentiated program in terms of the patient population as well as the profile. The profile itself with its unique multi-targeted mechanisms working with the body systems, with the safety and tolerability we've demonstrated to date, with the lack of impact on lipids and on weight and the oral convenient dosing profile. And then the opportunity population-wise, not only to be a first-line agent, but potentially be differentiated in type 2 diabetics as well as pediatrics. And then, of course, you know, where there is a need in this very large marketplace, heterogeneic place, For combinations, we believe our profile is well-suited there. Thanks for your question.

And the next question is from Julian Harrison with BTIG. Please go ahead.

Hi, good morning. Thank you for taking my questions. In your discussions on the path forward for 1125, I'm curious if four serotics have come up at all. Is this a subset that might make sense in the future to explore as a cohort, or is it safe to say you're focused on earlier stages of NASH for now?

Hi, Julian. This is Manu Chakraborty. Thanks for the question. So our first phase 2b is, of course, going to be focused on further guidance in non-steroidic NASH using the guidance that the FDA has on this one. So it will be, as Bill alluded to earlier, standard histological criteria, F2F3, NASH greater than 4. Your question about potentially considering other things, of course, you know, that's always on our minds. We believe our platform is applicable widely across the disease spectrum. And as you know, we already have a program in 1665 with more advanced liver disease patients.

Okay, great. Thanks. That's helpful. And then on your presentations at AASLD, sorry if I missed it, but should we be expecting any incremental data or new analysis of prior data? Is that something you could possibly comment on now?

So as you know, we have two posted presentations, both focusing on the overall population from the 003 and as well as very excited to talk about the subgroup of type 2 diabetics who have had a differential impact and consistent impact on all of our key markers. So those are the two key ones that we'll be presenting there.

And so the diabetic population gives you a little bit of additional color and depth versus what you've seen previously, Julian, in specifics. Great. Thank you.

And the next question is from Jessica Phi with JP Morgan. Please go ahead.

Hey there. Good morning. Thanks for taking my question. I was wondering if you could share a little bit more about the pre-IND meeting for 11-25. What were some of the kind of suggestions that the FDA had that you were able to incorporate into your study plan?

So we spoke by phone as well as correspondence. Obviously, we cannot share with you all of the fine details on this, but I think what we can share is the fact that the path that Bill had outlined before, which is that we can go into a straight biopsy study, so serial biopsy study that is focused on histological endpoints, 48-week duration in the standard population, again, you know, F2, F3, typically with an aspirated and four standard criteria. So that streamlining was really helpful. Their acceptance of our proposal suggests to us that the package that we have so far generated from our 002 and 003 studies, which were all characterizing non-invasive markers, certainly seems to be deficient to get us to this very streamlined path.

And Jess, this is Bill. Good morning. Thanks for the question. I would just pull it back up even from 1125 for a minute and say between 1125 and 1665, we've now had a series of interactions with both the FDA and other regulatory agencies and I just want to rest on the fact that you know there have been questions about how can we proceed what's the best path and what can we do and what I can tell you is consistently we have been able to move inside of design to phase 2 and phase 2b inside of four years which is quite remarkable when you step back and think about it additionally we are very clear that we don't have to do gating toxicology work we don't have to worry about a number of aspects related to how we formulate, how we placebo, how we execute our programs, whether in the non-IND or now going into the IND setting, that the safety is well understood and characterized, and that the FDA is supporting us moving forward into a biopsy-confirmed trial, in this case at a Phase IIb level. So we're extremely excited about this in terms of what it validates for our platform and our approach. and the fact that it puts us in a position to be well-informed in a highly efficient way, and this also bodes well for our future programs.

Okay, great. And then, just on 1665, I know you're advancing into Phase II and OHE, but what's your way of thinking on the cirrhotic sarcopenia opportunity with that asset?

Yeah, so we'll continue to believe that both hepatic and muscular metabolism are important aspects related to this program and our opportunity to differentiate. We will be continuing to measure in the more advanced patient population muscle function and structural measures as well. Our core focus, of course, is on the existing regulatory endpoint prevention of recurrent OHE. We will be measuring these and see whether there are, in addition to the differentiated mechanism, that allows us to support additional claims and then potentially in the future additional populations. Our core focus right now is getting the regulatory approval in the core platform. Manu, is there anything you'd like to add there? No, I think that covers it really well, Bill.

Great. Thank you.

Thank you.

The next question. is from Thomas Smith with SVB Lirink. Please go ahead.

Hey, guys. Thanks for taking the questions. First, just on the planned Phase IIb trial for 1125 and NASH, can you just clarify the patient population you're targeting here? Are you looking exclusively at the F2, F3 population, or is there potential that you could enroll some F1 patients with comorbidities as well? You also mentioned taking two doses of 1125 into this Phase IIb. How are you thinking about which doses to take forward here relative to the 003 study?

Yeah. Hi, Tom. This is Manu. So, again, to reiterate, the population that we're going to focus on for the Phase IIb is the standard accepted guidance from the FDA. So, which is typically F2, F3 patients, which signifies more advanced disease. with a NAFLD activity score or NAS score that's typically greater than or equal to four. So these are pretty standard guidances at this point, so this is certainly a core population that we'll be testing in the Phase IIb trial. The broader question, of course, as I think was asked earlier, can we go earlier, can we go later? So these are all possibilities that we will evaluate, and certainly our modality allows us to interrogate those earlier populations. as well as the more advanced population. So those are all considerations for us. But in the phase two at this point, our plan is to do the standard guidance. But again, once we finalize the protocol, IND is accepted, we can share with you the more precise details of the breakdown. Now your second question about the two doses. So, again, these are also being discussed, and we do need to wait for the final acceptance to share the final details with you, but I think it's suffice to say, based on our 003 and the 002 trials, where we tested, if you recall, in the 002, 72 grams per day, and then the second one was 48 grams per day, we believe that we have enough information from a dosing perspective that we do think that up to two to three doses would be the doses that we would take in the Phase IIb

um and a final of course decision on what the doses are we'll have to wait until we actually finalize the protocol and get the ind accepted okay got it and then um just a quick follow-up on 4010 and sickle cell um you're going to get the initial results here from the the first cohort in december and then sounds like you're going to decide whether or not to open up the subsequent cohorts kind of a go no go decision on the program can you just Talk a little bit or maybe give a little more color around what you need to see from this first data set to guide that decision on whether or not to move forward.

Sure, Tom. We're excited for this readout coming up beyond our core liver programs and lead programs there because as you're familiar with, we're looking at three major biologies there, red blood cell metabolism, vascular function, and inflammation. And we're looking, of course, at safety and tolerability. That's to answer your question. What we're looking for is the right directional impact on the biologies as well as the appropriate safety and tolerability in which is a population that has a number of comorbidities. This was a Bayesian design, which means you have a relatively small number of subjects. It allows you to make a binary decision and then move forward into additional cohorts. We're optimistic. We'll wait eagerly to see the data. and then we'll communicate our decision, and then we will be expanding into additional cohorts next year, assuming that that's positive. Got it.

Got it. Okay. Thanks for the caller, and thanks for taking the question. Of course. Thank you.

Again, if you have a question, please press star then one. The next question is from Mayank Mamthani with B. Reilly Securities. Please go ahead.

Good morning, team. Thanks for taking our questions. And again, congrats on a productive year so far. So maybe if I can pick on, you know, this ASLD update next week, and really in the context of, you know, your choice of patients for phase 2b, could you maybe touch on the type 2 diabetes cohort? What proportion of that, you know, you're thinking about in phase 2b? And if at all you're allowing for, you know, some background therapies like GLP-1s be included in that study. And then I have a follow-up.

Sure. Mike, hi. This is Manu again. So very excited about the diabetes subgroup. As you can tell, you know, partly because I'm an endocrinologist and I like to have some therapies here to help these patients who really don't have many options right now. So in terms of the diabetes subgroup, and what we can share with you is the fact that based on the epidemiology, 40 to 60% of the NASH cohort typically ends up being diabetic. And people with diabetes certainly have more advanced liver disease. So this is a well-known bidirectional pathway that has been studied and understood for many years. So the exact proportion, we obviously cannot say what it is, but I think it's suffice to say 40% to 60% based on the epidemiology. And as I think Bill already outlined the trial design, we are stratifying people on diabetes. So this is the same thing that we did in the 003 study. We expect to do the same. In terms of the question around the background meds, again, these are fine details that we'll have to wait until we finalize the protocol. But certainly, you know, standard of care therapies are something that we're very familiar with. And again, you'll recall from 003, we had a very similar patient population, similar management, and we anticipate the same here as well.

And, Mike, this is Bill. I would just add that, you know, this next Phase 2b is an opportunity to follow up our two studies that included Type 2 diabetics, both 002 and 003, where we replicated the findings and really determined, at a greater degree, the potential differentiated benefit for this important population. And we will also have the data on the broad population without type 2 diabetes. So this sets us up very well to understand and then guide our next steps in development post that.

That's very helpful, Kalle. So my follow-up in context of also, you know, your IND discussion is, you know, I'm thinking about the platform broadly. So what kind of, you know, I'm just curious, drug-drug interaction, you know, earlier stage clinical work you have to do, you know, and I'm also thinking about the OHE study where, you know, there are background therapies. So can you just walk us through, you know, some learnings you might have had in this type B meeting and maybe you'll have another type B meeting for OHE. You know, what are those considerations on the talk side or on the, you know, on the earlier stage, phase one that you, you know, you had, you know, effectively moving past very quickly to get to a, you know, a Phase IIb study across different invitations.

Yeah, so I'll start, Mike, and then hand it to Manu for the second part of the answer here. So I'll reinforce something that you brought up here that I'm very excited about, which is we now have two consecutive program interactions with the agency where there are no gating toxicology studies or work that's required, and that's because not just of the modality of our studies, but the amount of data and information we're able to provide in our submissions and dossiers. So that is something we feel very confident about on a go-forward basis for our platform. Additionally, we have other steps, whether it's DMPK related, whether it's related to our compositions, et cetera, that we, again, can move faster and more efficiently than traditional models. In terms of drug-drug interactions, there are some aspects Sorry, we got a call there. There are some aspects in any case that the agency requires you to do. The question is, is it in what context? And so we feel very good about our potential to not have significant drug-drug interactions based on our overall mechanism, and I'll have Manu quickly expand on that. And then what you should know is there are no gating aspects related to DDIs in work that's necessary prior to starting these studies. So, Manu.

Yeah, so just to build on that, Mike, so the modality is endogenous metabolic modulators, right? So amino acid biology in general do not share the same clearance pathways, enzymes, transporter mechanisms as xenobiotics. So this is a unique distinguishing feature of our platform. We've obviously showcased that, and then this is the reflection of what we've got from the agency feedback-wise. Many of the usual things that are gating, like talks, CMC, DMPK-related things, are not factors here. So I think that should be a testament to the intrinsic safety of the modality. The other is, you know, we've, since the very beginning, you know, from the 002 study, the 003 studies, we've allowed the con meds, which are typical of the comorbidities these patients have. You know, people typically have hypertension, hyperlipidemia, diabetes. These are all polypharmacy diseases that have many concomitant meds. And so we have clinical experience already under our belt on these meds. So going into the 101 study, we do feel quite confident that, again, because we've already done these studies to some extent, we're essentially following the same principles, the same management guidelines, and so feel confident that these are not going to be issues. But again, I would emphasize that we would have to wait until we formalize all of our protocols and have the IND acceptance in order to share with you the fine details. I think your second question was, you know, potential interactions with the agency on 1665, if I recall correctly. So I would just remind everybody that, you know, with 1665, we've actually had, you know, several agency interactions, including both U.S. and ex-U.S. We had very productive meetings with them over the course of the last year, as well as this year. along with ex-US agencies, where we've been able to come to a fairly good understanding of what the protocol looks like. So we're not anticipating any further interactions. We are going to submit the IND and anticipate its approval in the first half of 21 to initiate the phase two also in the first half of 21. Hope that answers your question.

Yes, yes, appreciate the comprehensive color. And my final one is just a quick reminder on where you are with the pediatric NASH indications.

Yes. So, again, this is one of our exciting opportunities, just like, you know, the diabetes subgroup is. Unfortunately, you know, the pediatric NASH is a significant health burden, a medical burden that is unmet because of the epidemics of obesity and diabetes that is also happening to our kids. We did raise this topic with the FDA. However, the agency primarily focused their interactions with us on the adult development program, and understandably so, since we had a lot to get through. We, of course, plan to reengage them with our pediatric development program once we have the Phase 2B in adult underway.

Thank you for taking my question. Appreciate it. Thank you.

Once again, if you have a question, please press star then 1. The next question is from Andreas Argarides with Wedbush Securities. Please go ahead.

Good morning, team. Thank you for taking our questions. I'm also Liana. Most of our questions have actually been answered, so I'll just ask two brief ones right now. With regard to the PHES score, I know it's the gold standard for minimal hepatic encephalopathy. So how do you plan to use it in the overt population?

Thank you for your question. So the PHES is indeed a battery of five different tests, pretty rigorous to have a pretty comprehensive psychometric evaluation, assessing various cognitive domains from executive function to memory to coordination, visual, spatial aspects. It has been used both from an MHE standpoint, but also to actually prognosticate OHE. So, it is, in fact, used in that setting of HE, and we believe that given our results from the 002, we are able to not only look at, of course, the MHE subgroup or the subpopulation, but also how does that impact future OHE events.

And Manu, maybe speak about the population that MHE predisposes for OHE.

Exactly. Yeah. So, that's a great point, Bill. So the risk of a future OHE event is really predicated upon two main factors, right? One is, of course, the prior OHE event, which is why our population is going to have that. And the other, equally important, is a prior MHE. So the studies so far have shown that if you have a MHE at baseline or a prior MHE episode, which, again, is best diagnosed with a PHES, those people are going to have five to six-fold higher risk of a future OHE event. So very, very pertinent for us, and hence one of the key assessments in our study.

Okay, great. Thank you for the color on that. And then for the 4010, I know you didn't provide too much color on the previous question, but maybe you could briefly discuss the proposed mechanism based on the composition Just some of the key things to look at. Thank you.

Sorry, would you repeat that question, please?

Yeah, so what he asked was basically the proposed mechanism for 4010 in terms of just a little bit more depth on the red blood cell metabolism and kind of some measures that we look at that are important.

Yeah, great. Yeah, so in terms of the mechanism, it's very similar to the way that we've approached our aspects in the liver space. So it's multifactorial, given that SCD is indeed a very complex disease. And one of the key aspects there is for us to look at the disease from a more comprehensive standpoint to address its sequelae. So specifically focusing on three biologies. One is red blood cell physiology. The other is vascular biology or vascular function. And then the third, of course, is inflammation. Each one of those things contribute ultimately to vaso-occlusive crises, which are ultimately currently the current thinking on how the drugs are getting approved for SED. But certainly from a clinical standpoint and an outcome standpoint, vaso-occlusive crises are indeed a big burden for patients. So we believe in our comprehensive approach of really tackling this in a multifactorial way, similar to all of our other AXA products here. It's very consistent with that. So the measures, of course, are also multifactorial to address each of those biologies. So we have specific markers for each of those, for vascular function, RBC physiology, as well as inflammation.

And Andres, we see a couple of important biology read-throughs here. Of course, you're also familiar with GBT's approval on a hematological endpoint in sickle cell disease, but there are also important other health and disease areas where these biologies play an important role. So we're excited to see this read through and the continued opportunities that we see for our design platform that's very efficient.

Great. Well, we're looking forward to the update as well. That's all from me. Thank you, guys, and congrats on the progress. Thank you.

Ladies and gentlemen, this concludes our question and answer session. I would like to turn the conference back over to CEO Bill Henshaw for any closing remarks.

So thank you all for tuning in with us today, everyone. We are very pleased and proud of the progress that the company has made in 2020, and we're excited about what lies ahead for Accela, and we look forward to seeing many of you on the virtual circuit in the weeks ahead. So this concludes our call, operator. Thanks, everyone. Be well and be safe.

And thank you, sir. The conference has now concluded. Thank you for attending today's presentation.