I am Brian Skorney, I'm one of Baird's senior biotech analysts. With me on stage, we have the management team of Arbutus Biopharma. Arbutus is a name that I do currently cover. They're focused in the hep B space right now, but have a lot going on in some recent news. Maybe just to start things off, Bill, if you could give us a little bit of an intro to what Arbutus does and the latest news that you announced earlier this week. Sure. Thank you, Brian. So I got two slides, the forward-looking statements, obviously. But on this one, just to kinda highlight what we're up to at Arbutus. So we have a highly experienced team of virologists, led by Mike Sofia here, our Chief Scientific Officer, and we're focused on hepatitis B as an area of huge unmet medical need. And what we're aiming to do is create a combination of medicines with different modes of action that could be used in combination to develop a functional cure for hepatitis B. Now, the news that we announced on Monday, actually earlier on this week, is that we had been active in coronavirus research as well. But following some issues that we ran into, some PK issues with our lead Mpro candidate, we then decided to make the difficult decision to stop the development of the coronavirus programs at Arbutus. So frustrating because I know Mike and his team have spent many years working in that area, but we felt it was better to use the resources back on our primary focus area of hepatitis B. So that is what we're doing, and the silver lining, if there is one, of that decision, is that we're now able to extend our cash runway out for two years to Q3 of 2025. Now, also included in that press release were two other pieces of news. The fact that our RNA destabilizer program, which was a program we had, to try and find an agent that would reduce surface antigen in hepatitis B, that also hit some tox issues, so that's a program that's stopped. But the assets that we do have, 729, the RNAi to reduce surface antigen, and AB-101, which is our PD-L1 inhibitor, those are full systems go for hepatitis B. On Monday, we announced that we'd actually dosed the first patient in our AB-101 clinical trial, phase I. So that's the news this week. I've mentioned in most of the points on the slide here, and I'm sure you'll have a question or two about our patent litigation. So, maybe I'll just stop there with this slide, which is the summary of the 729 clinical trials, the phase I and the two phase IIa studies. 729 now does have a generic name, imdusiran, and there you see also the AB-101 that's just gone into phase I. Great. So maybe we can kind of pull back and at a high level, just talk about hepatitis B, where it sort of fits in the viral hepatitis paradigm and how it's currently treated, and what the potential opportunity here is for something that can, you know, add to or potentially- Right ... cure. Hepatitis B is, I mean, it's a global disease, close to 300 million people suffering from hepatitis B globally. Big markets in the U.S., Europe, and enormous markets in Asia and China, which is where the big disease burden is. About 900,000 people die every year from complications of hepatitis B. This is a market that has huge unmet need. Only about 10%-11% of patients are diagnosed, and about 2% are treated. At the moment, you can treat hepatitis B with a nucleoside or interferon, but those treatments are lifelong. And so what we're aiming to do is come up with a combination of agents where you treat for a shorter, finite period of time, maybe a year, two years, suppress all the viral parameters, hopefully reawaken the immune system such that the, the body can then hold the infection in check. So that's, that's our goal. It's what, what we call functional cure, and after that, patients would be off of therapy. Great. I think there's always a lot of confusion between hepatitis B and hepatitis C. Maybe you could help us understand what it is about the life cycle and biology of hepatitis B that makes it so difficult to cure? We have potent antivirals, but obviously, that leads to very, very few cures, though. Right. Right, so if you look at the two viruses, they're really quite different, although they attack the same organ, the liver. So hepatitis C is an RNA virus, replicates only in the cytoplasm of the cell. Doesn't integrate its genome into the host genome, and doesn't have a reservoir of viral genetic material. That said, when you look at hepatitis B, hepatitis B is quite different, it's a DNA virus. It has this very stable reservoir of genetic material in the nucleus of a liver cell, known as cccDNA. It also integrates some of its genetic information into the host genome. Those things, in addition to the fact that hepatitis B seems to have a very unique and cunning way of controlling the host immune response, such as it causes this thing called immune exhaustion, meaning the host, the body's immune system really doesn't recognize the existence of the virus. All that together makes hepatitis B a much more challenging problem than one saw with hepatitis C, where we're able to generate or develop, you know, all oral cures, literally sterilizing cures for hepatitis C, where hepatitis B, you know, we're really looking at functional cure, which is in fact, the body's immune system having a complete hold and check over the virus. So you're really not looking at a sterilizing cure because today, no one really understands and knows how to eliminate, the cccDNA, which is the viral reservoir in the nucleus of the liver cell from hepatitis B. Great. And, you know, I think, as we said, there's very few patients who sort of achieve a functional cure once they have chronic hepatitis B, but a few do. Is there anything to kind of take away from those patients and how has that sort of informed the development programs out there and your RNAi specifically? You want to take that one, Kathy? Yeah, I can take that one. So, you're correct, very few patients in the natural course of diseases achieve functional cure, and even those that are treated with nucleoside analog therapy and interferon achieve that less than 5%-10%. What's interesting about those patients, though, is they do revert to a state similar to someone who would have cleared the virus or suppressed the virus on their own. So most adults, when they're infected with hepatitis B, are actually able to control the virus with their own immune system, not require medication, and essentially have really no increased risk of cirrhosis or hepatocellular carcinoma, which Bill mentioned, are the the big concerns with chronic hepatitis B. So when a patient who is being treated with a nuc or interferon is able to achieve functional cure, it puts them in a similar risk category for hepatocellular carcinoma and cirrhosis, meaning they have a much lower risk than a patient who is requiring ongoing therapy with a nuc for, you know, their lifetime or a patient that's not treated at all. Great. So moving on to your clinical program, imdusiran now. You've started and run a number of studies. Can you just kind of review the clinical data that we've seen so far and how that kind of informs next steps and probabilities of success? Yeah, sure, absolutely, and I can take that one as well. As shown here, this is the pipeline slide, which shows our three clinical trials with AB-729 or imdusiran that are still ongoing. So the 001 trial was our first in-human study, and that I think was a very uniquely designed study, where we looked at single doses in both healthy subjects for safety, obviously, and then single doses in hepatitis B patients, which really led us to look at some unique dosing strategies for imdusiran, I think, compared to some of the other siRNAs in development. So with that study, we were able to show that a 60 mg dose given every four weeks and every eight weeks is essentially similar or equivalent to a 90 mg dose given every eight weeks or every 12 weeks. So it gave us a lot of flexibility in terms of the dosing intervals for imdusiran, and actually, in our phase II studies, we've chosen the 60 mg dose every eight weeks for those studies to take forward. And in that 001 study, we showed a, you know, very consistent decline in surface antigen between 1.5 and 2 logs in most subjects after 48 weeks of treatment, and that suppression was sustained even in the post-treatment follow-up period, up to another 48 weeks. Many patients remained in that 1-2 log decline from their baseline, and really, no subjects rebounded their surface antigen back to pre-study levels, so a continued suppression of surface antigen even off treatment with imdusiran. In that study as well, we also looked at patients who were not being treated. The bulk of the study was patients on stable nucleoside analog therapy. We did look at a group of untreated patients and showed that we could also reduce hepatitis B DNA as well with imdusiran. So as Bill mentioned earlier, we have, you know, really three pillars we're looking at here for hepatitis B. So reduction of viral antigens, including surface antigen, suppression of replication, measured by HBV DNA, and then stimulation of the host immune response. So in that 001 trial, we were able to show imdusiran can target each of those pillars, as we did also see some evidence of immune reconstitution in that study as well, and those analyses are still ongoing from the immunology perspective. In phase II, really the goal was to continue to develop the profile of imdusiran, so showing that we can have a very consistent surface antigen decline in a larger population of patients. So those two phase II studies looked at a lead-in period of 729 to reduce surface antigen to the maximal extent possible, and then, excuse me, started to look at different methods of modulating the immune system. So the first study was using interferon, which is an available treatment for hepatitis B, as was already mentioned. And then the second study was with the therapeutic vaccine, Vaccitech VTP-300, both with a similar idea of how can we improve the host immune response against hepatitis B when we've taken the steps to reduce viral replication and reduce surface antigen. So those studies are still ongoing as well. We presented some initial data from the interferon study at the EASL conference in June. Early data, the most subjects were very early in the interferon treatment period, but showed a very, you know, consistent, again, surface antigen decline with imdusiran during the lead-in period and some hints that interferon may actually be potentiating that response. We had four subjects so far go to undetectable during the interferon treatment period, and we're continuing to follow the bulk of the subjects in this study. In terms of the Vaccitech study, that data will be reported preliminarily by the end of this year. So again, we'll have a data set of subjects in the vaccine treatment period, that we hopefully will report, as I said, you know, by the end of the year. So we're very excited about that data. Okay. Do you think that'll make AASLD, or is that more of a- Hopefully. Yeah. We'll see what they say. Great. So, I mean, I guess when we kind of think about the various combination strategies and obviously, functional cure is sort of the endpoint, at what point do you kind of move forward into a phase III, and how do you think about proper phase III trial design here? Yeah, good question. So, you know, we have these two phase IIa studies ongoing right now, which are kind of more set up to try and demonstrate proof of concept. So we have to let those run a little bit further before we can kind of press the button on a spend for a phase III study. We need to be, you know, sure that we're backing the right combination. But meanwhile, we're also progressing AB-101. So, you know, ultimately, we might wanna consider a trial, which is AB-729 plus a nucleoside, which is kind of the standard leading, and then use our own AB-101 to boost the immune system. So we have to wait, obviously, for that asset to complete phase I, but, you know, that would be another combination strategy going forward. Great. And then, I mean, maybe just, from the competitive side, there's a number of other approaches. Shutting down S antigen, I think there's another RNAi, and oligo that's in phase III. Just Can you just talk a little bit about the data that you've seen there and how that builds confidence or any competitive differences between their programs and yours? Well, just a couple of things on why imdusiran is different from the RNAis. As Karen said, we've built in some dosage optionality going forward. If patients ultimately are, you know, dosed every two months or every three months with a subcutaneous injection, that's a clear advantage over the other RNAis. Mike quite often talks about the single trigger piece. Do you wanna just summarize that for the audience? Yeah. So, when you look at the technical aspects of design of an RNAi for HBV, what's unique about HBV is it had this overlapping reading frames in its genome. So if you pick a specific site on the genome to cut, so to speak, with the RNAi, you can essentially knock down all viral antigens and viral proteins and other genetic material produced from HBV genome. So we were then able to do that, to identify a specific site that allows us to knock down all viral proteins and genetic material coming off of cccDNA, as well as coming off of the integrated form of S antigen transcript in the host genome. That's somewhat unique. Some of the others require two triggers because they haven't picked the correct site, and so they can't target the integrated form. Others can't target, for example, the X transcript, which is X protein in HBV, is a transcriptional activator, so they can't actually knock down that. So this one trigger really is an advantage as far as its breadth of effect on HBV overall. And obviously, from a cost of goods, it's also an ideal scenario. And then we have the ligand, the GalNAc ligand that allows us to target the liver specifically. So that gives you a really unique PK profile, meaning you know, very soon after administration, you do not see any circulating levels of imdusiran. What you do see is it all really all resides in the liver, which makes it a really nice liver-targeting strategy that we've developed for the drug. Yeah. Yeah. So that's a few of the differences. But back to your question on competition. Yeah, GSK have an asset in phase III. From memory, the kind of functional cure rates that they've shown around 10%-11% which is a step change from, you know, the current, you know, 5%. At Arbutus, we set ourselves the goal of trying to find a combination with at least a 20% functional cure rate, so that there would be a very clear step change from, you know, historic treatment to a new paradigm of functional cure. I don't know if, Karen, you want to make any other comments on the GSK situation. No, I think it's very interesting. They're taking, you know, their product forward into phase III at this point. So yeah, we hope for their success because I think that may, you know, buoy the entire field in hepatitis B, showing that functional cure is possible. But I agree with Bill. I think, you know, so far, their data has, you know, been, I think, a little less than we had hoped in terms of the rates of functional cure, meaning sustained response. Yeah. They had very interesting responses on treatment, but I think as many of us have had difficulty sustaining those responses- Yeah once treatment is finished. So we're, you know, very interested to see how their larger trials mature. Okay. Well, congrats on starting dosing on 101, healthy volunteers, as you said earlier and announced earlier this week. Everyone's familiar with sort of PD-1, PD-L1 pathway now, if they're involved in the biotech space. What's the rationale for targeting PD-L1 in hepatitis B? Yeah. So if you look at hepatitis B, it's, As I mentioned, what's unique about this virus, it's caused this thing called immune exhaustion. And what you see on liver cells, for example, you have an upregulation of PD-L1 on the surface of liver cells. You can see that when you take PBMCs out of an HBV patient and then treat them with either an antibody or, in our case, a small molecule PD-L1 inhibitor, you see a reconstitution of immune response there. So there is evidence supporting that checkpoint blockade is playing some role in the immune exhaustion phenotype you see in HBV. Our approach is very unique, relative to, you know, what you see in the oncology space, which, with the antibodies, and that's, that's related specifically to HBV as a disease. As we mentioned, HBV is, is treated currently with nucleosides, although lifelong, and they're fairly well-tolerated. So the issue with HBV is that you want to make sure that you bring forward a new regimen that is also fairly well-tolerated. And as we know, with antibody therapies in the oncology space, you have a lot of immune-related adverse events associated with a PD-1 or PD-L1 therapies. And so we wanted to try to circumvent those immune-related adverse events. And the approach that we're taking is this small molecule approach, because we can with a small molecule, we can do a couple of things. 1. We can actually target the liver, so you get high concentrations in the liver and limit peripheral exposure. The other aspect of it is, you know, obviously, it's oral, which is more convenient for patients, since we have a very large patient population in this space. And we also believe because of the small molecule characteristics, we can actually fine-tune the effect that we're looking for. So we're using PK/PD relationships. We can actually more effectively address the not only efficacy but safety aspects of this modality for treating HBV in combination with, for example, entecavir. Okay. And then I think the study that you're running is healthy volunteers in New Zealand. Is that correct? I guess, what data do you expect to see next year? How does that translate into potential entry into clinical trials in the U.S., or do you think you need to move into patients in New Zealand first? Yeah, I can take that. So you're correct, the initial part of the study is a phase I healthy subject study. So, you know, likely some initial data from that portion of the study sometime in the first half of 2024, but, you know, we'll give more guidance to that in January as the study matures. You know, in regards to the U.S. and the FDA, you know, that's still being evaluated. You know, we have multiple opportunities to go back and discuss, you know, with the FDA, you know, the ongoing clinical trial data. The study right now is set up as an umbrella study, meaning it will transition from healthy subjects to chronic hepatitis B subjects in New Zealand, and typically with these studies, you need to broaden to multiple countries, multiple sites. So that study will progress, you know, as a typical antiviral study, although obviously very different target, you know, not your typical antiviral- Right ... but, you know, designed in a similar way to eventually get into hepatitis B patients as part of that trial design. So, you know, we'll continue to work with the FDA and look for opportunities to engage with them. Yeah. Great. Is that, is it Ed Gane running this study? Yes. Yeah. So then when you, when we start to look at healthy volunteer data, what can we tell from sort of biomarkers here about the level of PD-1 targeting that you're achieving here, and what will give you confidence to, like, move forward? Well, what's unique about this target? It does allow us in a healthy volunteer study to actually look at some markers of potential efficacy. So we have actually developed some very unique and proprietary clinical-based assays that allow us to look at target engagement and target occupancy. So are we engaging the target? Are we binding to the target, and are we seeing that target initiate immune responses that we would want? Right. So, that is gonna be a nice piece of data that comes out from our Phase I healthy volunteer study that should give us some expectation for its potential efficacy in patient population. Great. And I think you're currently running, in one of your studies, there's a ± checkpoint inhibitor arm. How far along is that portion? When will we get data from that, and is there a selected PD-1 or PD-L1 inhibitor in that, or is that just any? Yeah, I can speak to that. So that's part of our, 729-202 study- Yep. in combination with Vaccitech using their therapeutic vaccine. So, you know, the rationale from that is some of what we previously mentioned, that there certainly appears to be a role for checkpoint inhibitors in, chronic hepatitis B. Vaccitech has actually used nivolumab, a low-dose nivolumab, in their studies with their VTP-300, in subjects on nuke therapy and have shown that nivolumab seems to induce a deeper decline in surface antigen, when used in combination with the boost portion of their VTP-300, vaccine strategy. So what we did in the 202 trial is we actually amended an additional arm into that trial- Yeah ... using the same study design, meaning an imdusiran and lead-in period for the first 24 weeks to lower surface antigen, then administration of the therapeutic vaccine with the addition of low-dose nivolumab with the boost portion of the VTP-300 regimen. So, you know, our hope is that we'll see enhancement of, of surface antigen decline, hopefully more subjects to undetectable, hopefully potentiation of that, host immune reconstitution as well. Mm-hmm. That amendment opened for enrollment in June, so we're continuing to enroll- Okay ... that amendment at this point. Great. You know, one of the earlier technologies that the company had developed is lipid nanoparticles. You have an LNP sort of platform, and you've licensed to a number of companies the royalty agreements, including Alnylam, notably. Can you just walk us through a quick overview of that LNP? Yeah. So, when Arbutus was formed, it was the merger of two companies. One focused on hepatitis B, and then the other was the LNP platform company. At the time of the company's creation, we wanted to focus on hepatitis B, so we, although we are the owners of the LNP patent, we licensed that patent suite to a company called Genevant, in which we have about a 16% shareholding now. The remainder is owned by Roivant. So that's important because it's now Genevant that are responsible for developing the technology. They can create their own products from that technology or license it out to other companies, and in both of those scenarios, we would receive royalties based back on the agreement. So that's, that's the overall structure. There is an existing royalty stream from ONPATTRO, which we do receive. And then I think, as I said on one of my earlier slides, there was a note there about some litigation that we filed against Moderna and Pfizer-BioNTech. So it's our assertion that in the development of the COVID vaccine, both Moderna and Pfizer-BioNTech used our LNP technology. And so we filed suit against Moderna about a year and a half ago, and then again with Pfizer-BioNTech about a year ago. I can't really say too much more about the ongoing litigation, obviously, other than there is a claims hearing in the Moderna case on February the seventh, twenty twenty-four. Now, we did, at the time of filing those complaints, put the full complaint letters into our press release so folks can read the long legal documents and the full complaint. So that's all out there. We've also made very transparent the financial arrangements and licensing agreements between ourselves and Genevant. So put simply, if there is any settlement from these cases, we would receive 20% of whatever the award is. So, I think that's about as much as we can say right now. Yeah, great. So, I mean, with the February Markman hearing coming up, I know, we often see settlements around immediately before or immediately after so, I know people will be watching on that. Well- Great ... in the last minute here, you know, if there's anything else you think I didn't ask that, investors should be aware of when it comes to Arbutus? No, I mean, I think it's been an interesting week for us. So obviously some disappointing news at the beginning of the week with the coronavirus program. But we're very confident now about imdusiran moving forward, and AB-101, it's delightful to see that clinical trial starting. And like I said, the silver lining of those announcements is that we now can use our capital and extend our runway out to the third quarter of 2025. So it's a two-year, two-year runway for us. Great. Well, thank you so much for being here today. Exciting story to follow, and looking forward to the updates over the months. Great. Thank you. Thank you very much. Thanks. Thank you.