Spero Therapeutics, Inc.

Good afternoon and welcome to the Sparrow Therapeutics third quarter 2022 financial results conference call. At this time, all participants are in listen only mode. Following the company's formal remarks, we will open up the call for questions. Please be advised that this call is being recorded and a replay will be available. You can find information on the replay and further information related to today's announcement on the Sparrow Therapeutics website, www.sparrotherapeutics.com. At this time, I would like to turn the conference call over to Ted Jenkins, Vice President, Investor Relations and Strategic Finance at Sparrow Therapeutics. Mr. Jenkins, please go ahead.

Thank you, Operator, and thank you all for participating in today's conference call. This afternoon, Sparrow Therapeutics released financial results and provided a pipeline update for the third quarter of 2022. A press release is available on the investor page of the Sparrow Therapeutics website. Before we begin, I'd like to remind you that some of the information presented on this conference call contains forward-looking statements based on our current expectations, including statements about the future development and commercialization of SPR 720, SPR 206, and Tebby-Pettim HBR, and the design, initiation, timing, progress, and results of the company's preclinical studies and clinical trials and its research and development programs, management assessment of the results of such preclinical studies and clinical trials, the company's cash forecast and anticipated expenses, and the sufficiency of its cash resources. Such forward-looking statements are not a guarantee of performance, and the company's actual results could differ materially from those contained in such statements. Several factors that could cause or contribute to such differences are described in detail in Spare Affidavit's filings with the SEC, including in the Risk Factors section of our quarterly report on Form 10-2 for the quarter ended September 30, 2022, filed today. These forward-looking statements speak only as of the date of this conference call, and the company undertakes no obligation to publicly update any forward-looking statements or supply new information regarding the company after the date of today's call. Participating in today's call are Dr. Ankit Mahidibia, Chief Executive Officer, Dr. Kamal Hamad, Chief Medical Officer, and Seth Shukla, our Chief Financial Officer. With that, I'd like to turn the call over to Dr. Ankit Mahidibia. Please go ahead, Ankit.

Thank you, Ted, and good afternoon to everyone who's joined us for a discussion of our third quarter financial results and company highlights. The third quarter was an exciting time for Sparrow as we successfully executed our new strategic direction that we set forward in the second quarter when it became clear that Tebby Penham would not receive FDA approval on its first cycle of review. The strategy we laid out was to move forward with SPR 720 as our lead asset and advance Tebby Penham HBR and SPR 206 as our designated partnership directed programs. We made this decision because we felt it would position us for future growth, allow us to maintain good stewardship of our capital, and ensure the medicines that we develop continue to advance towards potential regulatory approval. In addition, our long track record of establishing creative partnerships with leading organizations gave us confidence that we would be able to successfully execute our new strategic approach. Our confidence and our approach were validated this past September when we entered into an exclusive license agreement with GSK for Tebipenem HBR. As delineated in last week's press release, we have now closed this transaction. Sparrow has already received the $9 million associated with GSK's equity investment and will soon receive the $66 million upfront payment and will be eligible for up to $525 million in additional milestone payments as well as low single-digit to low double-digit tiered royalties on net product sales. This collaboration adds even more strength to our balance sheet and shareholder base. In exchange for the upfront payment and potential milestones and royalties, GSK is being granted an exclusive license to develop and commercialize Tebipen and HBR in all territories except Japan and certain other Asian countries, which will be retained by Sparrow's partner, Meiji Seika. Under the agreement, Sparrow is responsible for the execution of an upcoming Phase III study, and GSK is responsible for the execution and cost of additional development and commercialization activities for tebupenem-HBR outside of the Meiji-Seika territory. Given GSK's global reach and history as a leader in infectious diseases, we believe they are the ideal partner to fully unlock tebupenem's value and expeditiously deliver it to medicine patients following regulatory approval. We therefore view the new partnership as our key step towards potentially providing millions of complicated urinary tract infection patients with an at-home oral option that may also reduce hospital resource utilization. It's our hope that Tebby Penham HBR may provide an alternative to the intravenous therapies which currently are often a patient's only option. Extensive clinical and market research data suggests that Such an option would improve clinical care while delivering substantial economic benefits to patients, physicians, and payers alike. We are eager to continue developing tebepenem as the potential first oral carbapenem antibiotic for the development of CUTI and are thrilled to be supported in this endeavor by our world-class partners at GSK. Looking ahead for tebepenem-HBR, we expect to initiate a new Phase III clinical trial in 2023. Prior to entering our agreement with GSK, we aligned with FDA on key components of the trial design at a recent type A meeting. Feedback from this meeting indicated that positive results from this single additional trial together with confirmatory non-clinical evidence of efficacy could be sufficient to support tebipenem HVR's approval for the treatment of complicated urinary tract infections, including pyelonephritis for a limited use indication. This upcoming pivotal trial will build upon the extensive clinical and non-clinical data previously generated with tebupenem HBR, which include the results of our prior Phase III clinical trial, ADAPT-PO. The results of this clinical trial, which were published in the New England Journal of Medicine, demonstrated that oral tebupenem HBR was well-tolerated and not inferior to IV ertapenem in the treatment of adult patients with complicated urinary tract infections or acute pyelonephritis as per the pre-specified statistical protocol. We are currently working to finalize the design of our upcoming trial, which will be the subject of a special protocol assessment request. With review of our newly forged partnership complete, I'd like to now introduce Sparrow's recently appointed chief medical officer, Dr. Kamal Hamid. Kamal joined Sparrow in September, bringing with him an impressive range of experience within the biotech industry, global pharmaceutical companies, and as a practicing physician caring for patients with infectious diseases. He has a long track record in infectious disease drug development, including multiple drug approvals. He's integrated seamlessly into his new role at Sparrow and has displayed the expertise and commitment to our Sparrow values that made him the ideal candidate to serve as our CMO. with the added strength kamal brings to our management team our clinical pipeline and our gsk partnership we've laid the foundation for sustained growth into 2023 and beyond we have cash runway through key milestones for each of our clinical programs and have a deeply talented team in place all of our programs are supported by clinical and non-clinical data that provide clear differentiation over competing approaches and each has demonstrated the potential to deliver clear clinical and economic benefits. With that, I will now turn the call over to Kamal to speak about his decision to join us here at Sparrow and to provide an update on the SPR 720 and SPR 206 programs. I'll hand it over to you, Kamal.