All right, good morning, everyone, and thanks for joining us at the Morgan Stanley Global Healthcare Conference. I'm Michael Ulz, one of the biotech analyst here, and it's my pleasure to introduce Andrew Cheng, a CEO from Akero Therapeutics. Just as a reminder, the format for today is a fireside chat, but if you would like to ask a question, please raise your hand and we'll get your question answered. But before we get started, I just need to read a quick disclaimer. "For important disclosures, please see the Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative." And with that, Andrew, thanks for joining us today. And maybe we could start with just a little bit of background on maybe your lead program, efruxifermin, in terms of its mechanism of action and maybe how it's different from the recently approved NASH therapy. Sure. Thank you, Mike. Our drug is a efruxifermin, is FGF21 analog agonist. What we see is this is a drug that works by two mechanisms. One is the direct-acting antifibrotic impacting hepatic stellate cells and their transformation to myofibroblasts, so it decreases new collagen synthesis, and that's different than Rezdiffra. Rezdiffra also works in a way where it decreases liver fat, which is something efruxifermin also does, both compounds work within the liver. Efruxifermin also works externally, which is something it works on. There are two sources of liver fat. One is extrahepatic sources from the adipose tissue, and efruxifermin works there, whereas Rezdiffra really works solely within the liver. It's a thyroid hormone receptor beta agonist. Yeah. And, there's a couple other FGF21s in development. Maybe just talk about any key points of differentiation for your program. Sure. So, our compound is an FGF21 fusion protein, and it's bivalent, so it's two FGF21s hooked up to a Fc portion. That's why our half-life is in between three and four days. There's a company called 89bio that also has an FGF21 that's very close to us in development. There is a single-chain FGF21 that has a GlycoPEG moiety attached, and that's how it gets its longer half-life. It's similar to ours at about three to four days. I believe there's a company called Boston Pharma that has, also has an Fc portion, FcRn compound. They're looking at it for monthly dosing, and I believe Novo has a compound as well that they're looking at. Gotcha. And maybe with that background, we could sort of dive into just the MASH or NASH, whatever you're calling it these days. Talk about maybe that market opportunity, and also, you know, how it's sort of evolved over the past few years and your, you know, maybe how your thinking there has evolved as well. Sure. So I think it's important just to think about roughly a quarter of Americans have fatty liver disease. And so when you think about the numbers on that, 350 million Americans, so 90 million, 85 million-ish, have fatty liver disease. About a quarter of those have NASH. Those are the sort of the estimates. So you're looking at roughly 20 to 22 million Americans with NASH, and until March of this year, when Rezdiffra was approved, there were no approved drugs for it. And right now, NASH is the number one cause of liver transplantation in the United States. So as we think about this, it's a drug that affects a lot of people, and there's really just one drug that's been approved for, I guess, it's September now, for a little less than six months. Yeah. So I think the market opportunity is quite sizable, and it's probably why there's so many drugs in development. Yep. Can you maybe touch on the different fibrosis stages, and kind of why that's important? Sure ... and maybe where the current agent is approved, and maybe opportunities in the future to expand beyond that? Yeah, so Rezdiffra is approved in F2, F3 patients. Recall that the stages of pre-cirrhosis are F1 through F3, which is really advanced disease, and then there's F4, which is cirrhotic. That's when the liver becomes very scarred and is primarily fibrotic, and it's when you're an F4 patient that unfortunately, those patients often decompensate. They have elevated hepatic venous pressure, and with that portal hypertension, they get some of the clinical sequelae, which are ascites. They also get hepatic encephalopathy. They have esophageal varices that can lead to hematemesis, so these are some of the decompensating events that are seen with cirrhotics. Gotcha. And maybe you can talk about the impact or the potential impact GLP-1s could have on NASH and where they might fit into the treatment landscape. Yeah. So the GLP-1 class, I mean, it's who doesn't know about that class- Right ... nowadays? But what I'd say is that those drugs, although they're best known today for their effects on weight loss, these drugs haven't just been approved with weight loss. They've been around for more than a decade, and they were indicated for type 2 diabetes, and it's important to recall that there's quite a degree of overlap. Roughly 50%-60% of NASH patients are diabetic, and in the United States, nearly all of them are overweight. So when you think about the concentric circles, where GLP-1s, I think GLP-1s are indicated for obesity now, or their initial indication was for type 2 diabetes. There's a lot of GLP-1 use that is in NASH patients, and so we expect that to grow. In terms of where that will be used, they don't have an indication for NASH at this moment. They're indicated just for obesity and diabetes. Could they be indicated for NASH? I think we're waiting for phase III trials to see how they work. Yep. And do you think GLPs will be more, you know, earlier stage, so F 2, F 3 versus F 4, or could they potentially have activity in those later-stage patients as well? So I think it'll work in F2, F3. Primarily, my reason to be hesitant about F4 is the semaglutide had a trial that was a phase IIb study, looking at its use in cirrhotic patients in, I guess, this would have been the summer of 2022 at the EASL meeting, and they showed they had a placebo-like response. In fact, the one-stage improvement in fibrosis was greater, numerically greater on placebo than it was on the active arm. So I think most people, given their mechanism of action, weren't surprised, but the trial data sort of confirms that. Yeah. So less opportunity probably in F4, but maybe F2, F3 is a sweet spot there. And maybe, how does efruxifermin fit in, sort of in that backdrop, in your view? I think when we've seen some of the trial results, I think where it's different is a good example, or same thing, this isn't a situation where 100% of the patients respond. You know, it's really you look at some of the effect size in the clinical trials. We had some GLP-1 combo studies, so let's take the trial from Lilly that was presented in June and also published in the New England Journal of Medicine. It showed that it had a effect size at one year of about 20%. So meaning that the response rate minus placebo was about 20%. That leaves a lot of patients who aren't responding after a year of therapy. So when we think about combination therapy, it seems very likely that an agent like efruxifermin, that has shown a 75% one-stage improvement of fibrosis over a two-year time point with an effect size of 50%, would likely play a role in augmenting the efficacy of- Yeah some of the drugs that may come before it. Yeah. And you mentioned sort of combination opportunity. Maybe just touch briefly on some of your, I think it was cohort D, if I remember. Yeah. Like, you know. Yeah. So that trial was a trial taking patients who were all type 2 diabetics and all receiving a GLP-1. We didn't. It could be any flavor. And what we did is that, it was non-invasive, and we added efruxifermin 50 mg or placebo onto that background regimen of GLP-1 use for 12 weeks. And what we showed is that we really improved in just a short period of time the liver fat. Roughly 90% of patients normalized their liver fat. Liver fat is... Normal liver fat is about 5% or less, and all the patients were about 11% at baseline. So and then, patients who weren't taking GLP-1s in a, let's say, an earlier stage study, like in HARMONY, the average GLP-1, or excuse me, liver fat level is about 17, high teens%. The average patient in that trial had been on a GLP-1 for more than a year, and the median liver fat was about 11%. It has an effect. It has reduced liver fat about 50%, but just by adding efruxifermin on for 12 weeks, it reduced liver fat additional 70% from baseline, and nearly all the patients normalized liver fat and got to less than 5%. It shows that the two drugs work well together, and even though they both have some GI side effects, the side effects were not additive. The combination arm was not significantly different than the placebo arm- Yeah on background GLP-1. Yeah. Got it. So you're seeing nice activity in combination with, Yeah, and- Tolerable safety. Exactly. And on the other efficacy parameters, we improved hemoglobin A1c, which these patients were all diabetic, and we improved their lipids as well. So it seems to. And it makes biological sense because the GLP-1s work by asking the pancreas to squeeze out or produce more insulin. But most diabetics have type 2 diabetics, have a high degree of insulin resistance. Efruxifermin, as an FGF21, lowers insulin resistance. It's one of the few agents that does that. So it makes the amount of insulin, or, that is being produced go farther. It sort of decreases the height of the hill, as it were, the slope. And so not only did the patients improve their hemoglobin A1c, but the pancreas had to work not as hard because we looked at it as a measure of C-peptide, which is a by-product of endogenous insulin secretion, and that also decreased significantly. So it's consistent with what I just described, is that you see not only hepatic benefits, but also diabetic as well as lipid benefits. Yep. Gotcha. So in terms of where you see efruxifermin fitting in, it seems like, you know, in F2, F3, maybe in those patients that don't respond, and also potentially in combination in that subset, and then sort of F4 is wide open right now? Yeah, we certainly are do see that, because recall, even in our existing trials beyond cohort D, let's say the HARMONY trial, roughly 15% of patients were on background GLP-1 use. Yeah. So that's part of standard of care because these patients, as I mentioned, about half the patients are diabetic, so it's no surprise that a good number of those are also receiving GLP-1. Yeah, makes sense. Maybe we can switch now to some of your clinical data. You know, it's been very, very promising and, earlier this year, you shared 96-week data from your HARMONY study. That was in F2, F3 patients. I'd probably characterize that as better than a lot of people had expected. Maybe you can just highlight, you know, why that data set was so promising. Yeah. So you're right. When we recall that the primary endpoint, these are patients who are F2, F3, and they were treated with two doses of efruxifermin, either 28 or 50 or placebo, so it's a three treatment arms. And at 96 weeks, 75% of patients on the 50 mg dose demonstrated a one-stage improvement of fibrosis. And you're right, it far exceeded our expectations. Recall that at 24 weeks, we saw about 40%, and that, in many regards, was with a 20% effect size, was pretty robust as it at the time when we released those data in September 2022. But in March of this year, to see the 51% effect size, that's a number that's really unprecedented in NASH. There's no drug that even has a 40% effect size, let alone a 30% effect size. So we went from 20% to 50%, in terms of, one-stage improvement fibrosis minus placebo. So it really was remarkable, and it showed us two things, which is that the response rate at 24 weeks is not the plateau, is that longer dosing matters, and that is that the, continued, anti-fibrotic effect, direct acting anti-fibrotic effect, that efruxifermin demonstrates, shows that we saw not only more patients having that one-stage improvement fibrosis, because if you look at that 75%, about half the patients were existing patients who had already achieved that at week 24. But we recruited the other half of patients who were new and, became, successful at week 96. What's also impressive about that result is that it's not just the breadth of response that we saw. One of the other measures that you can look at is patients who have a two-stage improvement in fibrosis, and we saw roughly 36% of patients having a two-stage improvement on fibrosis on 50 mg at two years, compared to 3% on placebo. And so that number demonstrates a two-stage improvement of fibrosis is a relatively uncommon thing that you see in reports, because most drugs don't generate two stages of improvement fibrosis in NASH. In addition, to have 12 times placebo response rate at 33% effect size, would be something that many compounds would like to have as the one stage. So what it really says is that the longer dosing not only expands the number of patients that can respond, but also deepens the response that those patients who do respond. So, patients continue to benefit from this drug beyond 24 weeks. That's really what it shows. And what happens if you treat beyond 96 weeks? You sort of mentioned you hadn't really hit a plateau. You've had some patients with two-stage reductions. I mean, could you get patients, you know, to back to F1, like even later stage patients? You know, Mike, we're certainly hopeful for that, although we don't have any data. So this, the HARMONY study was a two-year study, so we won't have more data from those patients. But recall that we initiated phase III in Q3 of 2023, and so we're in the middle of enrollment right now, and it's something that we will be dosing these patients longer. So we have the potential to take a look at that. So you're not dosing patients longer in the HARMONY? No, the HARMONY study, they just consented. It's a two-year study, so that's the last endpoint on that trial. Yep, got it. Maybe just talk a little bit about safety from the HARMONY study, and then maybe just touch on bone mineral density and- Sure, why don't we start there? So, what we saw in the study was that we saw significant differences versus placebo in both the lumbar spine and the proximal femur in patients in that trial. Interestingly, recall that the median age in that study was 58, and that bone loss occurs about you know 1-1.5% per annum in post-menopausal women, and this is a 2-year study. We saw that the lumbar spine decreases about 3% on the efruxifermin-treated arms. But oddly, we saw that the placebo arm at the lumbar spine gained nearly 1%, and that's somewhat surprising to us because at that age, most of us are not gaining any bone mineral density, so we're not sure about that. We do know that in general, these patients were in very poor bone health, low vitamin D levels, and substantial number of patients were osteopenic at baseline, and they were not being treated with standard of care. So it's something that in our phase III studies, we're looking at improving and asking sites to adhere to standard of care in terms of what you do for osteopenic patients, and we're asking them to supplement with vitamin D and calcium. So I think it's something that we're certainly taking a close look at, but it's something that we'll have a better handle on in phase III. Makes sense. And, maybe we can now shift to your SYMMETRY study in F4 patients, so on more advanced on the scale. Maybe just remind us what you saw at the 36-week- Sure ... which, you know, we'd characterize as also very promising. Yeah. So at week 36, last October, we documented looking at roughly 155 patients who had biopsies at baseline week 36. We saw about 24% of the patients on the 50 mg arm having a one-stage improvement of fibrosis, compared to 14% on the placebo arm, which was not statistically significant, so we did miss our endpoint. Yet, at the same time, when we look at that, we did hit statistical significance for NASH resolution. And when one looks at a lot of the invasive biomarkers, it was clear that there's activity. In fact, although we missed for the primary endpoint, investigators, when they saw some of the results, really felt that these were, as you've mentioned, very promising and probably the best cirrhotic results the field's ever seen. Recall that no drug has ever demonstrated a statistical benefit for fibrosis improvement in cirrhotics. Many have tried because the medical need is so great, but no mechanism of action or no compound has ever done that. Yeah. Maybe you can touch just on the cryptogenic sort of subgroup- Sure ... and what you've learned there. Yeah, so cryptogenic patients are patients who, because they're the most advanced of the compensated cirrhotic patients, so this trial, this NASH SYMMETRY study, was in patients with compensated cirrhosis. And that, a subset of patients with compensated cirrhosis have cryptogenic cirrhosis. That is, they don't meet. When you look at how they're defined, they don't meet all the definitions of definitive NASH, but they have NASH, and it's attributable to disease. Gotcha. Maybe you could just touch on the requirements for regulatory approval. We've been talking about fibrosis improvement, also NASH resolution, and just, you know, considering for SYMMETRY. I know it's only a phase II, but, you know, no, no stat sig on fibrosis, but definitely on NASH resolution. Yeah. So right now, on the regulatory pathway for pre-cirrhotic patients, the FDA has given guidances that, if you demonstrate a benefit of either, NASH resolution or, one stage improvement fibrosis for pre-cirrhotic patients, that's sufficient to get approved. In Europe, it's an and that you need to hit both parameters for pre-cirrhotic patients. In the United States, currently, there's no pathway forward for histology in cirrhotic patients. The guidance is that you need to have clinical outcomes to demonstrate a benefit- Mm-hmm ... in cirrhotic patients, and that's the current guidance. Our phase III study, which we've just started in cirrhotics, has an outcomes-based endpoint, but at the same time, there is also a two-year histology component where we'll look at biopsies in a cohort of patients. Gotcha. Maybe we can shift back to SYMMETRY and you have, you've been following up those patients post 36 weeks. You'll have 96-week data in the first quarter of next year. Maybe just talk about maybe expectations around that. Yeah. So I think with the 96-week results, like the HARMONY 96-week results, we're not fully powered for the study. There are going to be the idea that we would have the same number of patients at week 24 and that we did at 96 was not true, and that's also for HARMONY, and that's the same thing that's true here. For SYMMETRY, we expect there to be dropouts because over an additional two-year study, recall that this drug requires a once-weekly in-clinic injections to be administered by a healthcare provider in phase II, so there's some degree of trial fatigue that takes place. That being said, as we've just talked about, you know, the results that we saw at HARMONY were quite good. Yep. You know, in terms of what we expect to see in SYMMETRY, I would say that cirrhosis is a tougher bar for patients, as there's never been a success in this patient population. We're hopeful overall that things will be improved, especially with longer-term dosing. Is there any way to think about what the level improvement should be? Obviously, in HARMONY, you saw, like, a doubling of fibrosis. But is there any way to sort of extrapolate that at all? I don't think so. I think it's difficult to say. I think we expect more patients to respond, and, well, we believe that the placebo response will be a little bit less. Yep. But at the same time, in terms of forecasting, we're not really giving much guidance- Yeah on that. I think it's. We're just saying that we believe the response rate will improve. Yeah. Recall that we are not fully powered. Right for week 96. Yeah. The trial was designed to be fully powered for a 36-week endpoint. Isn't that true of HARMONY? You weren't fully powered at the twenty-four week, yet you were able to sort of hit that, hit that- Yeah. So I think the response rate in HARMONY was remarkably good. But recall that in pre-cirrhotic patients, the collagen burden is much lower than in cirrhotics. So, could that take place? It could, but it's not something we're guiding towards. Yep, makes sense. Okay, maybe moving to, you know, your phase III SYNCHRONY program. You touched a little bit on the outcomes, but you also have two other studies that are ongoing. Maybe just- Yeah just paint the picture of the whole phase 3 sort of. It's a phase 3 program, and it's comprised of three studies. The first study is in the F2-F3 population. It's called SYNCHRONY Histology, and we have a primary endpoint of at 52 weeks. It's a composite endpoint where patients have to hit both one stage improvement in fibrosis and NASH resolution without worsening of MASH or worsening fibrosis in either case. And those trials started screening. We enrolled our first patient last December of 2023. And then there's SYNCHRONY Real- World, which is a non-invasive study, looking at patients F1 through F4, that we're following non-invasively, no biopsies. That trial is progressing, and we're very pleased how both studies are moving along. Can you just talk about the rationale for having a composite endpoint of fibrosis with NASH resolution- Yeah versus having them separately only? It's a. We'll present results for both, but we chose the composite primary endpoint because it's one the Europeans prefer, and so the U.S. FDA is fine with it. Okay. Is there any risk to combining them versus keeping them separate, or just given the robustness of the data it's- Given the robustness of the data to date, in fact, enhances the probability that we'll be successful- Yeah -on the combination. Yep. Because the placebo rate is much lower when the combined response rate. Makes sense. Can you remind us why you're deciding to move forward the 28 mg and 50 mg, sort of in the Histology and Real-World, as opposed to...? You know, it's something that we've received regulatory feedback on, that they'd like to see both doses. And you can see with Rezdiffra, they have three approved doses. Gotcha. I think it's something that, although the safety doesn't seem not that different and the efficacy does, it seemed to favor 50 mg. Doses phase IIB is small. Mm-hmm. So we'll take a look at these as larger studies. Okay. It'll give patients just another option of a- Potentially, if there's a difference. Gotcha. Okay. You did touch on just the pace of enrollment for those two studies, but I'm just curious, post the ninety-six-week data with those dramatic results, have you noticed any uptick in the sort of enrollment rate? When we share those results at our investigator meetings, it's funny. Those results came in, I believe, on a Monday, and it just so happened that about nine days later, we were initiating the study in Europe with the European investigators, and although people in the financial community follow our results, people in the clinical community don't always. Mm-hmm. So they don't read all the press releases. So when we shared it with them, they were really impressed. And it certainly positions us as having some of the most efficacious clinical trial results to date. Yep. And maybe for the real-world study, which is your non-invasive study, just maybe talk about like the sort of the state-of-the-art there and what kind of methods you're using to adjust. So we're looking at multiple non-invasive measures because non-invasive measures are what are followed clinically. Although the FDA has, and EMA have certain regulatory standards, liver biopsy is not used clinically. It's really just in trials. And so things that are non-invasive. Because recall, liver biopsy is just a portion with a sixteen-gauge needle, of a small number of one spot in your liver, whereas the non-invasive measures, specifically things that look at liver stiffness or other serologic markers of fibrosis improvement, reflect the whole liver. Okay. And just in the outcome study, you talked about this a little bit earlier, but maybe just remind us the trial design there and sort of the cohort one and the opportunity for a fibrosis look earlier for accelerated approval, I believe. Certainly in the F2-F3 population, that at one year you see we're looking at histology, but at the two-year mark in the cirrhotic population in SYNCHRONY Outcomes, we're planning on taking a look at biopsy, and both the FDA and EMA have agreed to that. As to the regulatory pathway, it's very clear in Europe that they accept histology, but in the US it's less clear, and right now the guidance says they do not. Once we take that look, it's something we certainly would bring to the FDA, and we'll see what happens at that time. Yeah. And can you talk about the 96-week data you'll have coming up in 1Q. Could you see anything in that study that maybe suggests you should make some changes to your outcome study? Or are you pretty confident in where that design is right now, and is that an option? Oh, no. We always benefit from more data. Yeah. So depending on what we find in the two-year readout in Q1, it certainly would behoove us to take advantage of that data set and potentially adjust how we approach the phase III program. Yeah because the phase III program is just getting going right now. Yeah. And I guess post the 96-week data in 1Q of next year, when could we start to see some of the phase 3 data? I mean, could it be, is it 2026, kind of the way we should think about it, or, or what- We haven't given a lot of guidance on that yet. Yeah. We'd like to be further along with our screening before- Yeah We sort of guide the Street towards when we might have results. Yeah, makes sense. And then maybe just quickly, just touch on your thoughts in terms of commercializing EFX. Is this something you might partner? What's your thinking there? You know, I think it's something right now. It really depends on what the trial results will guide us toward. Certainly, NASH is a big disease, and the commercial efforts will be quite substantial, but you can see that the first drug that got approved for this, Rezdiffra, is launching right now, and they plan on going alone. So I think it's something that we're following how their progress. Yep, and maybe in the last, you know, minute or so here, just maybe touch on your current cash position and runway from here, and does that cover the full phase III program, I guess? What we guided towards right now, we have $840 million in cash. That was at the end of Q2, which we just released last month. And what we guided towards is that, that cash gets us into the second half of 2027, and that, it gives us, gets us through the primary endpoints of the first two, phase 3 studies, that is SYNCHRONY Histology and SYNCHRONY Real-World. Got it. Okay, great. Looks like we're just about out of time. Why don't we end it there? Thanks so much, Andrew. Appreciate your time. Yeah, thanks for having us, Mike.