CinCor Pharma, Inc.

Greetings. Welcome to CINCOR Pharma's fourth quarter and full year 2021 financial results and corporate update conference call. At this time, all participants are in listen-only mode. Following management's prepared remarks, we will hold a brief question and answer session. As a reminder, this call is being recorded today, March 22, 2022. I will now turn the call over to Terry Qualho, Executive Vice President, Chief Financial Officer, and Chief Business Development Officer. Terry, please go ahead.

Good morning and welcome to CINCOR Pharma's fourth quarter and full year 2021 financial results and corporate updates conference call. Joining me on today's call are Mark DeGaradale, Chief Executive Officer, and Dr. Mason Freeman, Chief Medical Officer. We will hold a question and answer session following our prepared remarks where Catherine Pierce, our co-founder and Chief Operating Officer, and Justin Thompson, our Vice President of Business Development, will join as well. Earlier today, CINCOR issued a press release announcing financial results for the fourth quarter and full year ended December 31st, 2021. A copy of this press release is available on the company's website and through our SEC filing. Please note that on today's call, we will be making forward-looking statements, including statements relating to the safety and efficacy and the therapeutic commercial potential and regulatory status of our investigational product candidates, the expected timing of our clinical trials, results, milestones, sufficiency of CINCOR's cash resources, expectations with respect to CINCOR's growth and prospects, and statements with respect to human capital, among others. Various risks may cause CINCOR's actual results to differ materially from those stated or implied in such forward-looking statements. For a description of the risks and uncertainties that we face, please see our earnings press release issued earlier today and our risk factors contained in our filings with the Securities and Exchange Commission. including the risk factor section of our annual report on Form 10-K that we expect to file with the SEC later today. This conference call contains time-sensitive information that is accurate only as of the date of such information and our expectations as of the date of this live conference call, March 22, 2022. NCORE undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call, except as may be required by applicable securities law. A live listen-only audio webcast of the conference call can be accessed on the investor section of the Syncor Pharma, Inc. website. A replay will be available on the website approximately two hours following the live call for 30 days following the call. I will now turn the call over to our CEO, Mark DeGaradale. Mark, please go ahead.

Thank you, Terry. Good morning and welcome, everyone, to our first corporate update and financial results conference call. 2021 was a transformative year for us, and we have made significant progress across our corporate and clinical initiatives. We first provide a brief overview of the company before I turn the call over to Mason to review our clinical development programs, which will then be followed by a financial update from Terry. 2021 was a highly successful and foundational year for the company that was marked by many significant milestones. In October, we raised approximately $142 million net proceeds through Series B financing that included a number of high-quality healthcare-focused investors. We subsequently completed a successful IPO in early January, raising approximately $192 million net proceeds and attracting several new institutional investors. We expect our strength and balance sheet to provide a cash runaway through 2024 based on our current business plans, positioning us well to further execute on the ongoing clinical development of SYN107. There are four key takeaways regarding SYNCORE that I want you to list today. We have a focused and differentiated pipeline. We believe we have a robust potential market opportunity. We have multiple anticipated near-term catalysts in 2022 and 2023. And we have an experienced management team and a strong balance sheet. Our molecule CIN107 is a highly selective aldosterone synthase inhibitor. De-risked with phase 1 and blinded phase 2 clinical data. Promising early efficacy has been demonstrated by dose-dependent reduction in aldosterone levels in phase 1 trials following treatment with CIN107 and by reduction in systolic blood pressure and preliminary blinded safety data from the ongoing phase 2 Brighton trials which included two active doses and placebo. As we know, safety is critical for adoption of a drug, and we are pleased to report that with nearly 400 patients dosed across multiple clinical trials, we have observed a favorable safety profile in Phase I and Phase II studies to date, with no clinically meaningful impact on cortisol and no significant electrolyte-related adverse events. Additionally, As an all-once-daily small molecule, we believe C107 has an ideal dosing profile for chronic cardiovascular drugs. The second key takeaway relates to the potential market opportunity for C107, which we believe is robust and includes a broad patient population with significant unmet needs in hypertension, CKD patients with hypertension, and primary aldosteronism. As an example, it is estimated that 12 to 15 million patients in the U.S. are treatment-resistant. Treatment-resistant means patients are on at least three antihypertensive agents and are still not a target blood pressure goal. Thirdly, SYNCOR anticipates multiple near-term catalysts in 2022 and 2023. I am very pleased to share that we completed enrollment in the Phase II Brighton trial of treatment-resistant hypertension this month. with 275 patients randomized. In terms of data readouts, we expect top-line phase two data for both the Brighton trial and the Ello trial for uncontrolled hypertension on one or two background therapies are expected in the second half of 2022 and in 2023 for SPARC-PA for primary aldosteronism. This year, we're also excited to explore the dual potential of CIN107 to improve uncontrolled blood pressure with a planned initiation of a fourth phase 2 trial for patients with CKD. Finally, our experienced leadership team has a solid track record of success, notably in the cardiovascular field. We are also pleased to have named Dr. Mason Freeman as our Chief Medical Officer this month. Mason was EVP of Clinical Development since August 2021. Following our Series B financing and a successful IPO, We are well-signed and believe we are poised to successfully advance our business to the next phase of growth. Let me now turn the call over to Dr. Mason Freeman, our Chief Medical Officer, who will provide an overview of the unmet medical need, the science around aldosterone, and review our clinical development programs. Mason, please go ahead.

Thank you, Marc, and good morning, everyone. As this is our first earnings call, I thought it would be helpful to introduce listeners to the development plans for SYN107 by covering three topics. First, the unmet medical need of poorly controlled hypertension and the potential market opportunity that represents. Second, a brief summary of how the drug works to lower blood pressure by targeting a novel mechanism to control aldosterone, a hormone whose role in hypertension has been known for close to 70 years. Third, to conclude by providing updates on the four phase two clinical trials that have been or are expected to be initiated before the end of the second quarter of this year and how these four studies will inform our clinical development strategy for CIN107. According to the US Centers for Disease Control, CDC, hypertension affects approximately 116 million adult Americans. Poorly controlled blood pressure can lead to increased risks of major cardiovascular disease including the events which contribute to most of the morbidity and mortality of CV illness, such as heart attacks, strokes, heart failure, and advanced renal disease. These events also translate into a large financial burden on healthcare systems around the world, estimated to be at least $130 billion per year in the United States alone. Lowering systolic blood pressure by five millimeters of mercury is considered a clinically meaningful change by the FDA. and in accordance with the FDA's guidance, is sufficient for a cardiovascular outcome benefit claim in the label of any drug approved for the treatment of hypertension. Clinical studies have demonstrated that this level of reduction in blood pressure is associated with a number of clinical benefits, including a 13% lower stroke rate, a 13% lower rate of heart failure, and a 5% drop in mortality. Looking at the therapeutic landscape for hypertension, there have been no meaningful treatment innovations in medicines used to treat high blood pressure in the last two decades. But there are several established generic antihypertensive drug classes on the market, including angiotensin-converting enzymes, ACEs, angiotensin receptor blockers, so-called ARBs, calcium channel blockers, called CCBs, and diuretics. Despite the widespread availability of these generic medications, and the common practice of combining them to improve efficacy. An estimated 35% of Americans receiving treatment for hypertension still have blood pressure levels above recommended treatment guideline levels. Physicians treating hypertensive patients typically employ a step treatment approach, where a first-line antihypertensive agent is prescribed, and if a target blood pressure of less than 130 systolic and less than 80 diastolic is not achieved, then a second agent is administered. A third drug is then added, if necessary, until the desired blood pressure level is attained. When a patient is receiving three or more antihypertensive medications, one of which is a diuretic, and his or her blood pressure is still not at goal, that patient is said to have resistant hypertension. There are currently approximately 12 to 15 million adults in the United States who meet the definition of treatment-resistant hypertension. And currently, 60 million patients, treated or not, are believed to have blood pressure levels that are not at target goals, suggesting that the intersection of these two populations produces a potentially addressable hypertension market of close to 50 million people in the United States alone. As treatment goals for blood pressure values have moved steadily downward in the past two decades, these markets could have the potential to expand further if medical research provides support for even lower target blood pressure goals. To understand how Syncor's novel medication, Syn107, might contribute to the management of this important medical problem, one needs to understand the role of the hormones that regulate blood pressure in humans. Aldosterone is a steroid class hormone that is made in the adrenal gland in response to signals that direct the gland to produce more aldosterone whenever blood pressure and or assault or fluid levels are low. The pathway that largely controls these signals is called the renin-angiotensin-aldosterone system, often abbreviated as RAS, and many current blood pressure medicines work by inhibiting early steps in the RAS pathway. However, no current medication approved for hypertension blocks the synthesis of aldosterone, which is the final hormone produced in the RAS cascades. In addition to having major effects on the retention of salt and water by the kidney, aldosterone also activates other signaling pathways that can stimulate fibrosis, as well as increase cellular oxidative stress, inflammation, and myocardial cell hypertrophy, all of which can contribute to the pathogenesis of chronic kidney disease and heart failure. While there are medicines called mineralocorticoid receptor antagonists, or MRAs such as spironolactone and aplerinone, that can inhibit aldosterone's interaction with one of its receptors, these drugs actually raise levels of circulating aldosterone. In contrast, TIN107 lowers aldosterone levels by inhibiting the enzyme that synthesizes the hormone. Thus, it has the potential to produce a broader range of effects than the MRAs can, and we believe has the opportunity to produce additional benefits, such as minimizing tissue damage. It is this novel biology that makes the team at Syncor so excited about the potential of Syn107 to improve the treatment of hypertensive patients. Although aldosterone was structurally identified in 1954, no drug blocking its synthesis has ever been approved for the treatment of hypertension. The reason for this is that the enzyme that generates aldosterone, called aldosterone synthase, is almost identical to the enzyme that produces another vital adrenal hormone, cortisol. Making a medicine that can block the production of aldosterone without lowering cortisol levels has been one of the chief barriers producing a safe and effective medicine aimed at this blood pressure target. TENO-107 was designed precisely to do this, and its selectivity in carrying out this action is now supported by studies both in animals and humans where doses of the drug in the expected clinical usage range markedly reduce aldosterone levels in the blood but do not inhibit cortisol production. Beyond the findings of lowering plasma aldosterone levels up to 70% in human volunteers without inhibiting cortisol production, the CIN107 Development Program has generated data through its Phase I studies on several other properties of the drug candidate that we believe make it an attractive drug for a chronic blood pressure medication. It has a long half-life of 25 to 31 hours, supporting its use as a once-a-day medication. studies of patients with advanced renal disease, the metabolism of the drug appears little altered from that seen in individuals with normal kidney function, which we believe suggests that it is unlikely that physicians would need to alter the dose of SYN-107 due to pharmacokinetic limitations in the chronic kidney disease population. As many patients with chronic kidney disease have poorly controlled hypertension and are in need of improved blood pressure medications, we believe this would facilitate the usage of SYN-107 in patients with CKD assuming successful initiation and completion of our planned Phase II clinical trial of CIN107 in patients with chronic kidney disease. Additionally, no drug-drug interaction was found when CIN107 was given in combination with metformin, the most widely prescribed oral hypoglycemic used to lower glucose levels in patients with type 2 diabetes. The type 2 diabetes patient population is prone to both kidney disease and hypertension, making it another patient group where we could expect that CIN107 might provide important medical benefit. Overall, CIN107 was given to approximately 180 subjects in Phase I studies and has been well-tolerated in them. No dose-limiting toxicity was identified at single doses of up to 360 milligrams, and in all of the Phase I trials combined, No serious adverse events or treatment emergent adverse events leading to withdrawal from the studies due to CIN107 were identified. CIN107 moved into Phase II of drug development in the fall of 2020, and we expect to have four clinical trials ongoing by the end of the second quarter of this year. The Phase II programs are designed to evaluate the value of CIN107 in different hypertensive populations. The first of our Phase II trials we have initiated is called BRYTN, which is a study of patients with treatment-resistant hypertension. BRYTN is a randomized, double-blind, placebo-controlled trial designed to assess the safety and efficacy of SYN107 in subjects who have not achieved their target blood pressure despite receiving three or more antihypertensive agents, one of which must be a thiazide diuretic. The primary endpoint of Brighton is the change in systolic blood pressure from randomization to study end after 12 weeks of treatment, and we are comparing doses of a half milligram, one milligram, and two milligrams of CIN107 to a placebo control. As Mark shared earlier in the conference, as of this month, we have completed enrollment for Brighton with 275 patients randomized across all four dosing cohorts. The precise effect of CIN107 on systolic blood pressure in the Brighton study will not be known until the trial is unblinded, but the blinded data that we on the study team are permitted to review does show that the overall population of participants in the trial are experiencing a considerable blood pressure reduction, consistent with the observations we have previously reported. The study remains on track to deliver top-line data in the second half of 2022. To establish the efficacy and safety profile of CIN107 in a broader hypertensive population, rather than just those with a persistent hypertension, we initiated the HALO trial in late fall 2021. This randomized, double-blind, placebo-controlled study is designed to assess the safety and efficacy of CIN107 in patients with systolic blood pressures greater than 140 millimeters of mercury or, if diabetic, greater than 130 millimeters of mercury. These patients are taking fewer antihypertensive medicines at baseline than those enrolled in the Brighton trial. Halo is studying the same three dose levels of CIN107 used in Brighton, and its primary endpoint is the change in systolic blood pressure after eight weeks of treatment. The varying background generic antihypertensive medications in use in the subjects enrolled in Halo are expected to provide insights into which combinations and at what dosages CIN107 performs best. If successful, the outcomes of the HALO and Brighton trials should enable SYNCOR to define the patient population and doses of SYN-107 that would be tested in the Phase III registrational trials. With that goal in mind, we recently made two amendments to the HALO trial design that we believe will further aid in the design of our planned Phase III program. The first amendment allows patients taking up to two antihypertensive medicines at their maximally tolerated dose to be included in the study, as opposed to just one medication. And the Second Amendment allows patients to enter the study regardless of their baseline aldosterone level, whereas previously a specific minimum aldosterone cut point level was used as an inclusion criteria. We believe this Second Amendment will enable us to better characterize the relationship between baseline aldosterone levels and blood pressure responses across the full spectrum of aldosterone values we're seeing in the trial. And this approach will better allow us to determine if baseline aldosterone values from the plasma can identify patients who respond more robustly to SIN107's mechanism of action. Overall, both amendment changes are designed to broaden the hypertensive patient population included in the HALO trial and capture patient phenotypes that physicians struggle to treat in the real world. Both amendments were just approved by the study's central IRB and are currently being operationally activated in HALO. Before the end of quarter two this year, we plan to initiate our fourth phase two clinical trial in patients with uncontrolled hypertension and chronic kidney disease. It is estimated that there are currently over 37 million people in the United States who suffer from chronic kidney disease. And the poorly controlled blood pressure of many of these individuals contributes to both a higher rate of adverse cardiovascular events and a more rapid progression of their underlying renal disease. Preclinical studies have shown that elevated aldosterone levels contribute to a progressive decline in kidney function. The unique biological responses that an aldosterone synthase inhibitor, such as SYN107, can potentially generate by significantly lowering total aldosterone levels and thereby potentially reducing blood pressure while ameliorating direct tissue toxicity are issues that the CKD trial will be exploring. The trial is designed to be a randomized, double-blind, placebo-controlled trial in the U.S. that will expect to enroll approximately 300 patients. All patients are required to be on guideline-recommended RAS inhibition therapy, and they will be randomized to a low-dose or high-dose CIN107 treatment strategy or to placebo. The primary endpoint is a change in systolic blood pressure after 26 weeks of treatment. And in addition, the blood pressure responses will be followed along with various biomarkers of kidney function. We remain on track to initiate this trial in the first half of this year with top-line data expected in the second half of 2023. The last of our Phase II clinical trials to discuss today, SPARC-PA, was initiated in 2021 to evaluate CIN107 in patients with primary aldosterone, often just called PA. Patients with PA overproduce aldosterone due to the abnormal function of cells in the adrenal gland that escape the normal physiologic control on the hormone's expression. Although previously considered a rare disease, PA is now understood to be one of the more common causes of secondary hypertension, accounting for 5% to 10% of all hypertensive patients, and approximately 20 to 30% of patients with treatment-resistant hypertension. These estimates suggest there are approximately 5 to 11 million individuals currently in the United States with PA. Compared to essential or primary hypertension, PA causes more severe end-organ damage and is associated with higher risk of cardiovascular morbidity and mortality. While it is increasingly recognized that it is important to diagnose patients early in their disease progression, PA continues to be underdiagnosed due to the complexity of diagnostic procedures typically employed to identify these patients. We've recently redesigned the SPARC-PA study via two amendments that are intended to simplify the diagnostic process for qualifying for study randomization, and we will enable all patients in the trial to receive active dose SYN-107. The primary endpoint of the trial is the change in systolic blood pressure for the baseline value to that achieved after 12 weeks of treatment with SYN-107. The trial is also designed to assess the relationship between blood pressure changes and alterations in a variety of measurements of RAS pathway function. The changes to the protocol expected to achieve the same goals as the original design, which were to identify the dosage or dosages needed to lower aldosterone levels and reduce the blood pressure of patients with PA, thereby facilitating discussions with the FDA about the best pathway forward in Phase III to enable SUN107 to be approved for use to treat this aggressive form of hypertension. The amended SPARC-PA trial remains on track to report top-line data in the second half of 2023. So to briefly recap, hypertension is a very common medical condition that affects tens of millions of patients in the U.S. and worldwide. Large numbers of these patients are failing to achieve optimal blood pressure control with current treatments. providing an opportunity for CIN107 to potentially improve the care of millions of individuals. CINCOR now has three exciting Phase II trials underway, with top-line data expected in the second half of 2022 for two of those studies, BRITEN in patients with treatment resistance and hypertension, and HALO in patients with uncontrolled hypertension. We expect top-line data in the second half of 2023 for the third study underway, SPARC-PA, which is a trial in patients with primary aldosteronism. Our planned phase two trial in uncontrolled hypertension chronic kidney disease is expected to begin in the first half of this year, with top line data also anticipated in the second half of 2023. We believe these four trials, when concluded, have the potential to establish the value CIN107 can bring to hypertensive patients around the world. With that, I'll turn the call over to Terri to review our financials. Terri?

Thank you, Mason. This morning I will discuss key aspects of our fourth quarter and full year 2021 financial results. More details can be found in our Form 10-K, which will be filed with the SEC later today. As indicated in our press release today, R&D expenses for the three months ended December 31st, 2021 were $9.4 million, compared to $5.1 million for the three months ended December 31st, 2020. R&D expenses were $21.5 million for the full year ended December 31st, 2021, compared to $19.2 million for the full year of 2020. The increase of $2.3 million year-over-year was primarily due to the costs associated with the progression of our Phase II clinical trials, increased TMC spend, and the addition of several important R&D resources in the latter part of the year as we prepared to move away from the management services agreement with Cinerx, partially offset by the completion of several Phase I and CLIN-FARM studies in 2020. General and administrative expenses were $15.9 million for the three months ended December 31st, 2021, compared to $390,000 for the prior year period. G&A expenses were $21 million for the full year ended December 31st, 2021, compared to $2 million for 2020. The increased spend for both time periods was primarily driven by $10 million related to the settlement agreement with CINERX in the fourth quarter of 2021. CINRx was the incubator company which CINCOR was spun out of in May 2019 and which provided CINCOR with functional and clinical oversight support through January 2022. Under the terms of the settlement agreement, CINCOR agreed to issue 764,705 shares valued at $9.5 million of our common stock to CINRx. CINCOR also agreed to reimburse CINRx's legal fees for up to an aggregate total of $500,000. As a result of the settlement agreement in Q4 2021, the company recorded $10 million of expense, of which $9.5 million was non-cash. Additional drivers of the increased G&A spend year over year included legal costs and costs associated with the addition of key leadership and other critical management roles, particularly as we prepared to operate as a standalone public company. General and administrative expenses were $21 million, for the full year ended December 31st, 2021, compared to $2 million for 2020. The increase of $19 million was primarily driven by the $10 million I just discussed, as well as increased personnel costs, legal fees, and other costs associated with operating activities. The company ended 2021 with 11 employees, and while there are plans to double our headcount during 2022 with important resources in key functional areas to oversee and manager our clinical programs. The company expects to continue to rely on expert third parties to supplement our internal team. During 2021, Syncor incurred a non-cash expense of $7.9 million relating to the change in fair value of its warrant derivative liabilities. This change in fair value was driven by the issuance of additional warrants in connection with the Series B preferred stock financing, as well as an increase in the fair value of our underlying common stock, which is the primary driver of the warrant derivative fair value as assessed by an independent third party. In 2020, the company incurred a non-cash expense of $1.2 million due to the increase in the fair value of the underlying common stock in that year. These impacts are related to the stock purchase warrants issued to Roche in connection with the Roche Agreement when SIN 107 was acquired. Upon the completion of the IPO in January 2022, the Roche warrants automatically net exercised in whole, resulting in the issuance of 852,788 common shares to Roche. For the full year ended December 31st, 2021, SINCORP reported a net and comprehensive loss of $50.4 million compared to a net and comprehensive loss of $22.3 million for the full year ended December 31st, 2020. Turning to cash, cash and cash equivalents were $136.6 million as of December 31st, 2021, as compared to $26.1 million as of December 31st, 2020. During 2021, SINCORN completed a Series B financing, raising net proceeds of $141.9 million. In January of 2022, CINCOR completed its IPO, raising an additional $193.2 million in net proceeds after deducting underwriting discounts, commissions, and other offering expenses. CINCOR expects its current cash, cash equivalents, and investments balance to fund operations through 2024, which is expected to support the company's operating expenses through 2024, including our ongoing and currently planned Phase II and Phase III clinical programs. Finally, I'm pleased to share that we were added to the Russell 2000 and Russell 3000 indexes just last week and believe this will serve to further enhance our visibility in the investment community. We will provide updates on the company's progress as needed through earnings calls when we have important business developments to complement the financial results. I would now like to turn the call back over to Mark DeGaradale for some concluding remarks. Mark?

Thank you, Terry. And thank you, everyone, for joining us at our first quarterly conference call as a public company. We are pleased to have shared with you our success over the past year. This year, we expect several potential value-creating catalysts for CIN107, including top-line Phase II data for brightening treatment-resistant hypertension and ALO in uncontrolled hypertension in the second half of the year, as well as the initiation of the Phase II trial in chronic kidney disease in the first half of this year. In 2021, we assembled an experienced and talented management team to develop SYN107. I want to thank them for their dedication and contribution in the progress of the company, and we look forward to delivering further results for our shareholders as we work towards potential approval of SYN107, the new and improved drug candidate with differentiated therapeutic potential to address the unmet needs of millions of patients with hypertension and cardiorenal conditions around the world. I will now ask the operator to begin our Q&A session. Operator?

Thank you. We'll now be conducting a question and answer session. If you'd like to ask a question, please press the star 1 from your telephone keypad and a confirmation tone to indicate your line is in the question queue. You may press star 2 if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions.

Thank you.

And our first question will be coming from the line of Jeff Hung with Morgan Stanley. Please proceed with your question.

Good morning, and thanks for taking the questions. Can you remind us of how your aldosterone synthase inhibitor differs from others being developed?

So Mason, you want to take that one?

Yeah, happy to. Aldosterone synthase inhibitors are drugs that block the enzyme that produces aldosterone. There is another aldosterone synthase inhibitor that is currently being developed, and the major difference between our two drugs as we see them is the pharmacokinetics associated with the metabolism of the drug. Our drug has a half-life of 25 to 31 hours. The data that's been reported for the competitive aldosterone synthase inhibitors inhibitor has a half-life of three to four hours, at least from what we've seen published. So we think that could affect the ability to dose once a day. So our drug is clearly and is always in the clinical trials we've been using administered once a day. So we think that's a major benefit and really pretty much the standard of care for antihypertensives that are being used in the world today as single administrations once a day. More frequent administration certainly has an effect on long-term patient compliance. Both drugs have good affinity for the enzyme, so the pharmacokinetics is the major differentiator as we see it.

Great, thanks. And I know the FDA has provided guidance that a 5-milimum mercury benefit over placebo is needed for approval, but what kind of placebo-adjusted reduction in blood pressure do you need to see to be clinically meaningful, and how should we think about the expected reduction in blood pressure in patients on placebo? Thanks.

Good questions. The 5-millimeter mercury reduction that the FDA uses as a guidance is very clearly clinically meaningful. The data that I presented in part of the conference call that I gave indicated reductions in mortality of 5% and reductions in major cardiovascular morbid events of around 13%. So 5 millimeters of mercury is an important and valuable factor. blood pressure reduction, and I think people need to understand that. But that's not what we hope to achieve with the CIN107 program. We believe that a blood pressure lowering that's close to twice that would be something that we are anticipating might be achieved with this particular mechanism, but we won't know that until we unblind the data and can look at the placebo value and derive a placebo-corrected number.

Thank you.

Thank you. Our next question is from the line of Dennis Singh with Jefferies.

Please proceed with your questions.

Hi, good morning, and thanks for taking the questions. First off, congratulations on all the progress you've made in the successful IPO. My first question is sort of a follow-up to Jeff's question. Can you please elaborate on what are some of the pushes and pulls that you see on placebo? and some of the things that you perhaps may have implemented in the Phase II to minimize the placebo effect. And then my second question is on the HALO data coming in the second half. What would you like to see there, given that it's in an earlier line? And is it reasonable to assume that CIN107 would drive an even greater benefit on blood pressure? Or should we actually expect a smaller impact since aldosterone presumably plays a smaller role earlier in the disease. Thank you very much.

Mason?

Great.

Let me tackle the first question, which is about the variables that affect placebo responses in a hypertension trial and what we've done to try to mitigate them in the trials that we're doing. So there are a couple of factors. Clearly, patients who are taking multiple hypertensive medications, which describes the resistant hypertension, they have to be on at least three, many of them are on four or five medications, and one of them has to be a thiazide diuretic. So one of the concerns that always exists in a clinical trial is whether or not patients are taking all of their medicines all of the time, and if they were to start taking their medicines more during the course of the trial, then you would have an impact on the blood pressure response that was due to the better adherence to their medicines the longer they were in the trial. So what we did to minimize that is to have a run-in period of several weeks before randomization. We required the patients to take all of the medicines that they were being prescribed and were still not achieving blood pressure goal. We provided those medicines to them and so there was no cost disincentive to not take the medicines. And we did pill counts to make sure that they were adhering. So we believe that this has significantly reduced the variable of medicine compliance that has had a large impact on many previous resistant hypertension trials. The other reason blood pressure falls during the course of a trial in a placebo group at all is that people are reporting into a clinical trial site, they're getting advice on their diet, they're getting their blood pressure checked. There is a natural tendency for the placebo group to have a reduction. The mean of that reported in a large meta-analysis trial back in 2015 was about 5.9 millimeter of mercury reduction. That would be an expected placebo response in a trial like ours. But variables can differ between different trials, and of course, As I said earlier, we won't know the exact placebo response in our Brighton study or the HALO study until we've unblinded the data and can actually determine the exact placebo response that was measured. Sorry, the second question you were asking, you have to just quickly remind me. I lost it in thinking about the placebo was what?

Yeah, sure. It was just around your expectations for the halo data coming in the second half.

Okay, great. Sorry. Yeah, it's a really interesting question about whether we would expect to be more effective at lowering blood pressure in a less resistant population, at least on the face of it, you would expect that. The resistant population has already shown that they don't respond well to three or more medications and therefore they're a really difficult population to bring treatment into control. So you might expect that giving a drug earlier would have a more profound effect because you haven't selected for a resistant population. The counter argument to that is that it's very clear that resistant populations have a sizable proportion of patients who actually have Primary aldosterone. It's not diagnosed. They don't know they have it. Their clinicians don't know they have it. But they have a driver of their hypertension, which is aldosterone. And, of course, given the mechanism by which we work aldosynthase inhibitor, we would expect to have a particularly profound effect on the blood pressure of somebody whose blood pressure was so dominantly driven by overproduction of aldosterone. So you're really looking at what I would call counterbalancing factors in the control of hypertension. And so the short answer to your question is we won't know whether we work better in the earlier treatment group or in the resistant hypertension group until we get our data, unblind it, and see the answer. So I'm sorry I can't give you a prelude answer to what it's going to be, but that's why we run the clinical trials.

Got it. Thank you very much.

Our next question is from the line of Michael DeFior with Evercore ISI. Please proceed with your questions.

Hi, guys. Thanks so much for taking my question. A few for me. I guess the first one dovetails on what was just spoken on HALO. I thought I may have missed it, but can you clarify what was the amendment that was made to the protocol? From what I heard, are you guys no longer requiring any baseline level of aldosterone for entry into that study?

Yes, that's correct. We've amended two things in the protocol, just to recap. One is that we have allowed people to come in on two drugs, not just one, which had been the original decision. And that's because what we were finding is much larger populations of people that are having their blood pressure under control are already taking two drugs. we were losing a lot of patients that we thought were very important to study in the HALO study. So that's amendment number one. Amendment number two on the aldosterone was we've already got a group of people that have come into this study that have significantly elevated aldosterone levels above the six to seven nanogram per deciliter cut point. But when you think about what is likely to be an important commercial challenge for us going forward, which is to say can we predict blood pressure responses due to an aldosterone, By not allowing people in with the lower numbers, we weren't really able to predict whether or not the aldosterone is telling us how good or how robust the response is. So we decided to open up the inclusion to allow people at all aldosterone levels to be enrolled in HALO. We'll still have the group that's been enrolled already that has the high numbers, and we'll continue to get people with high numbers. It's just the population distribution of ALDO. But we will... have, I think, a much broader sense of how relevant measuring an ALDO is in predicting responses and whether or not that number can be used to actually select patients for a more robust response to CINAHL-07. It has also enabled us to speed the enrollment of the trial because by not having that inclusion criteria, a lot more people are eligible to be enrolled in a relatively rapid fashion.

Got it. Now that's helpful. It's two follow-ups. Again, one of your competitors is claiming almost a 4X greater selectivity for aldosterone than say. So is this relevant or is this a situation where like once a critical selectivity threshold is reached, then anything beyond that would be splitting hairs?

Yeah, I would agree with your latter characterization of the selectivity issue. I mean, there are times when selectivity and while we're talking about a quantitative measure of selectivity, our drug is incredibly selective. but now we're talking about how you measure selectivity. You measure selectivity typically in a cell-based assay looking at an interaction between two molecules, and you get a number. The question is, does the number matter very much when you get into the treatment of a patient? And if the doses that you are administering that bring the blood pressure down and lower the hormone in the case of our drug are nowhere near the differential that that selectivity advantage might provide, there's no additional value of the selectivity. So we're nowhere near the doses that cause any impact on cortisol, which is what the selectivity is about. So I don't think that selectivity advantage will confer any clinical benefit at all with the drugs that we're referencing here.

Got it. Very helpful. And the final question is just concerned with the variation or variability on potassium increases. I know you guys have a slide showing kind of very modest variations increases in potassium, but how variable is that? And I guess for patients who are having to be out of the norm, I mean, would that just preclude them from taking your drug?

Yeah, terrific question, an important issue that we are exploring in depth in the clinical development program for SYN107. So just a reminder to folks who don't live and breathe health, osteo and biology the way we do at SYNCORP, So aldosterone hormone directs the kidney to hold on to salt and to excrete potassium. That's its physiologic role. So when you block it, you do the opposite. You get rid of salt, sodium, and you hold on to more potassium. So one of the concerns with anything in the RAS pathway is that by blocking ultimately the activity of aldosterone, you can produce a potassium increase in the blood. So the real question is not does the potassium go up some, but does it go up to levels that cause you any concern? What we have shown in our S1 and what we've messaged in our test the water meetings with investors is that the data that we can see, and we look at it blinded, of course, we can see that in the overall population of everybody, including the placebo group, the potassium is rising from a baseline of about 4.1 to about 4.3 milliequivalents. Both of those numbers are are in the mid to low range of serum potassium. So they don't cause any concern at all. So the question that you posed, which is do you see some outliers, we do occasionally see patients in these trials who increase their potassium above five, very rarely above 5.5. The definition of hyperkalemia is 5.5. No one has withdrawn from the studies to date because of a potassium above 5.5 that was due to our drug. and most of the patients who get a 5.5 measurement never have another one above 5.5. We provide some very simple advice of increasing their fluid or reducing some potassium intake in their diet, and it's very easily controlled. So, so far we've been quite reassured about the safety of the drug vis-a-vis potassium, but we are now going to move into a chronic kidney disease trial this year, and patients with impaired renal function are have a little more challenge getting rid of potassium because of their kidney disease, and so we will be exploring the safety of CIN107 in that population to make sure that it continues to be a concern of minimum importance in all the patients that we would like to treat, and we'll report on that when we have the data from the CKD study.

Very helpful. Thanks so much. Thank you. Our next question is from the line of Jay Olson with Oppenheimer. Please proceed with your questions.

Oh, hey, everybody. Thank you for this update, and congrats on all the progress. Had a couple of questions. Since the blinded data you've seen so far has shown significant blood pressure reduction, and we could make some estimates about how the placebo arm is behaving, I think it's possible to extrapolate the likely treatment effect of SYN107. So could you talk about any feedback you've received from KOLs on the blinded data? And assuming Brighton results are positive, what's the read across to HALO?

Thanks very much for the questions. Well, I guess I would characterize the feedback we've had from KOLs is that when they see the overall cohort blood pressure reduction, I think the response has been overwhelmingly positive about what looks like a very, very worthwhile intervention on a very tough to treat population. I mean, they know, as you know, we don't know the precise number until we unblind, but the overall magnitude of the blood pressure reduction that we have seen in the Brighton study with the caveats about the unknown placebo, is certainly causing KOLs around the world that we've shown the data to be quite excited about the potential for our drug to treat an important and difficult population. So I think that's all that I can say about their response, but it's been quite encouraging just in courtesy of the enthusiasm that we're getting from the hypertensive community. In terms of the readout to HALO, You know, I mentioned earlier that there are some differences between how many people are likely to have primary aldosterone in a treatment-resistant population versus how many of them are likely to have it in the halo population, which is a population on one or at most two drugs and not controlling their blood pressure. So there'll be fewer patients in aggregate in the halo study that would eventually be diagnosed with primary aldosterone were that to be looked into. So that's the argument why we might see this slightly more robust response in the resistant population. But as I mentioned earlier, those folks are showing that their blood pressure response is really tough to treat. So it's hard to predict directly what the readout will be to HALO. And I think that I really can't offer you insight into that until we unblind the study later this year where we'll see it. We will begin to see blinded data in HALO just as we have in Brighton. And as we're allowed to look at the blinded data going forward, we'll have some insights into whether or not we're seeing better or worse overall blinded blood pressure response probably sometime at the end of the second quarter of this year.

That's super helpful. Thank you for that. And if I could ask one follow-up question. Since blood pressure guidelines have evolved over time, and I think it's been a few years since the ACC and AHA have updated treatment goals, can you talk about expert views or consensus opinions on where blood pressure treatment goals might end up and what would be the implications for SIN 107 if guidelines were to go lower than current treatment goals?

Yeah, it's a terrific question, and we have actually seen one of the society guidelines already issue new guidelines this fall, the so-called KDIGO guidelines, K-D-I-G-O. This is the Kidney Disease Professional Society, where they have indicated that they believe that patients with chronic kidney disease should actually target their systolic blood pressure to be under 120. Okay. That's the lowest systolic blood pressure guideline that I believe has ever been issued, certainly that I know has ever been issued. And the rationale for doing that is, interestingly, not so much about the benefit on kidney disease per se. It's the benefit on the very high cardiovascular morbidity and mortality in patients with chronic kidney disease. So that recommendation... is a cardiovascular recommendation, but made by a kidney disease professional society. And they moved it down to 120. How quickly other professional societies may adopt that, it really does depend on what patient population they feel that they're making recommendations for. And I think there's always an element of practicality among professional societies. They don't want to make recommendations that physicians can't achieve. And as I've already mentioned earlier in our market analysis, currently 35% of people receiving hypertensive treatment are not getting their blood pressure down under 140 over 90. That's what the data has that we have analyzed in our assessments of the problem. So for a professional society to move the numbers down dramatically below that, they may be challenging physicians to do things that they don't have the resources to do, meaning the medicines, which is why I think if those guidelines continue to want the blood pressure to be lower, there is a tremendous opportunity for SYN107 to address an even larger medical need than we're now describing based on the current professional guidelines.

Great. That's super helpful. Thank you for taking the questions.

Thank you. Thank you.

We have reached the end of the question and answer session, and I'll turn the call over to Mark DeGardio for closing remarks.

Thank you again to everyone for joining us on the call. We look forward to building on the momentum achieved this quarter, and we'll continue to keep you updated on our progress throughout the remainder of the year. Thanks very much.

Thank you, everyone. This will conclude today's conference. We disconnect your lines at this time. Thank you for your participation.