Hello, and welcome to the Aldeyra Therapeutics announces top-line results from clinical trial of ADX-629 in patients with atopic dermatitis. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you'd like to ask a question during this time, simply press star one on your telephone keypad. If you would like to withdraw your question, again, it's the star one. I'll now turn the conference over to David Burke, Head of Investor Relations. Please go ahead. Thank you, and good morning, everyone. Today, we issued a press release announcing positive top-line results from the phase II clinical trial of ADX-629 in atopic dermatitis. A copy of the press release is available on the Investor and Media section of our website, www.aldeyra.com. The press release contains important information and should be read and considered in conjunction with the slides presented and the prepared remarks made on today's call. With me today to discuss the results are Dr. Todd Brady, President and Chief Executive Officer of Aldeyra, and Dr. Matthew Zirwas, founder of the Bexley Dermatology Research Clinic and board-certified dermatologist, who served as Principal Investigator of the clinical trial. Turning to Slide two, this presentation and various remarks, which may be made during this presentation, contain forward-looking statements regarding Aldeyra, its investigational drug candidates, including ADX-629, and its plans, expectations, and opportunities, including potential clinical trials and regulatory activities. Forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause Aldeyra's actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statement. These statements are based upon the information available to Aldeyra today and reflect Aldeyra's current views with respect to future events and are based on assumptions and subject to risks and uncertainties, including the development, clinical and regulatory plans or expectations for Aldeyra's investigational drugs, including ADX-629. There are risks that result from earlier clinical trials or portions of clinical trials may not accurately predict the results of future trials or the remainder of the clinical trial. Aldeyra assumes no obligation to update these statements as circumstances change. Future events and actual results could differ materially from those projected in the company's forward-looking statements, including the results of operations and financial position. Additional information concerning factors that could cause results to differ materially from our forward-looking statements are described in greater detail in the press release issued this morning and in our filings with the Securities and Exchange Commission. I would now like to turn your attention to Slide three and introduce Dr. Todd Brady. Thank you, David. To our knowledge, Aldeyra is the first biotechnology company to exploit the development of new therapeutics that target RASP, or reactive aldehyde species, which are a series of endogenous and exogenous small molecules that are toxic and pro-inflammatory. RASP influence large classes or groups of proteins, particularly proteins that mediate the immune cascade. As illustrated on Slide four, targeting RASP represents a novel pharmacology. Unlike nearly every drug approved for human use today, RASP modulators do not inhibit or activate specific proteins and instead modulate systems of proteins. RASP modulation, therefore, has two distinct theoretical advantages. Number one, avoidance of the toxicity associated with activating or inhibiting specific proteins, which rarely occurs in nature on a sustained basis. Two, the ability to down or upregulate, rather than turn on or off, groups of proteins to achieve broad-based improvement in disease. ADX-629 is our first orally administered investigational RASP modulator, and as a signal finding molecule, has demonstrated clinical activity in a number of systemic immune-mediated diseases, including psoriasis, asthma, COVID, and chronic cough, as shown on Slide five. Together, the previously disclosed clinical trials of ADX-629, that we are aware, represent the first series of results potentially supporting the utility of the novel pharmacological approach of RASP modulation. As described on Slide six, the signal finding results of ADX-629 are intended to support the development of next-generation RASP modulators. ADX-246 is in development for oral administration to treat systemic immune-mediated diseases, and ADX-248 is in development for intravitreal administration to treat retinal diseases associated with inflammation and RASP-mediated formation of toxic metabolites that accumulate in photoreceptors and other cells in the retina. Slide seven summarizes the clinical features of atopic dermatitis, which as many of you know, is a common disease of the skin, often affecting children. It is characterized by itching and dermal lesions. The etiology of the disease is thought to be immune dysfunction associated with hyperreactivity to endogenous or internally generated or exogenous factors, which in either case may include RASP. Atopic dermatitis is typically treated topically or in moderate, severe cases with injections. We believe that the demand for safe, tolerable, and orally administered therapies, however, especially for mild to moderate patients, is substantial. To date, there is no generally available or accepted oral therapy for treatment of these patients. The phase II clinical trial of ADX-629 in atopic dermatitis, outlined on slide eight, represents another installment in the ongoing signal finding clinical testing of ADX-629 in systemic immune-mediated diseases. The trial was designed to enroll mild to moderate atopic dermatitis patients and evaluate investigator-assessed outcomes, such as the classically employed IGA and EASI scores, as well as patient-reported outcomes, such as itching and depression and anxiety, which are often associated with atopic dermatitis. ADX-629 was administered orally, twice daily at a dose of 250 mg for 90 days. Slide nine presents the baseline characteristics of the eight patients enrolled in the trial, which is consistent with a mild to moderate atopic dermatitis adult population. On slide 10, the safety profile of ADX-629 in the trial is summarized. Only two adverse events deemed to be at least possibly related to ADX-629 were reported. Both were mild. Importantly, no rescue therapy was required, and no patients were deemed to have experienced a flare while on ADX-629 therapy. All patients demonstrated clinical improvement during therapy with ADX-629. Slide 11 presents the results of the investigator-assessed EASI score, which is typically employed to assess the severity of atopic dermatitis. Relative to baseline, reduction in EASI severity approached 60% on average, an effect that was highly statistically significant. The reduction in EASI score was consistently greater with time, and by day 90, the end of treatment, four, three, and one patients improved by 50%, 75%, 90%. The commonly cited EASI-50 and EASI-75 thresholds were therefore 50% and 38% respectively. Similar statistically and clinically significant patterns of activity were observed in other investigator-assessed outcomes, as is presented for affected body surface area on slide 12 and IGA on slide 13. Notably, affected body surface area completely cleared in one patient, and the same patient was rated zero or clear on IGA assessment. Like with the investigator-assessed outcomes, patient-reported outcomes improved over the duration of ADX-629 therapy and were statistically and clinically significant, as can be seen on slides 14, 15, and 16 for itching, eczema scoring, or POEM, and depression and anxiety scales, respectively. Clinically relevant threshold reductions in itching, which is a significant morbidity in patients with atopic dermatitis, were achieved in three patients. Importantly, two patients reported complete resolution of itching. For the POEM score, clinically relevant changes were observed in six patients, or 75% of the population. Finally, patient-reported depression and anxiety scores improved in a manner that is consistent with investigator and patient assessments of disease severity. As presented on slide 17, the observed activity of ADX-629 relative to baseline in atopic dermatitis is remarkably similar to that previously disclosed for ADX-629 in psoriasis, supporting the notion that RASP modulation could be broadly beneficial in systemic immune-mediated diseases of the skin. Slide 18 summarizes the results of the trial, which add to the growing body of evidence that RASP modulation, as a novel pharmacology with the potential to affect many factors at once without any consistent toxicities observed to date, could represent a new approach for the treatment of disease. The potential activity of ADX-629 in this signal finding clinical trial supports the advancement of ADX-246 to a phase I/II clinical trial in patients with atopic dermatitis, which is the first of Aldeyra's systemic RASP indications to advance to formal development with ADX-246. The proposed clinical trial of ADX-246 in atopic dermatitis is summarized on slide 19. Pending results from single ascending dose and multiple ascending dose testing in normal, healthy volunteers, a 2-to-1 drug to placebo randomization scheme is planned to enroll approximately 30 atopic dermatitis patients for treatment over 90 days. Contingent on U.S. Food and Drug Administration investigational new drug application review, and other factors, the trial is expected to begin in the first half of 2024, and top-line results are expected later next year. Operator, I'd now like to open the call for questions. Thank you. If you have a question, please press star one on your telephone keypad. If you wish to remove yourself from the queue, simply press star one again. One moment please, for your first question. Your first question comes from the line of Kelly Shi of Jefferies. Your line is open. Thank you for taking my questions, and congrats on the progress. It is very interesting, as the consistent signal observed from this early data. I'm curious if RASP inhibition is associated with the JAK-STAT signaling pathway, which most of the current AD drugs were based upon. And how is the overall AD profile similar or dissimilar to the mainstream drugs? And I also have a follow-up question after this. Thank you. Thanks, Kelly. I think that's a very relevant question. JAK as a target has received a lot of press recently, as has the related molecule TYK2. I think that those pharmacologies are perfect examples of what I described as traditional pharmacology in the beginning of this call. As a medical community, we've identified very specific targets, that is, certain proteins. We've identified drugs to target those certain proteins. I think the problem with that, as I mentioned in my prepared comments, is often toxicity. In nature, we do not turn specific proteins on or off for sustained periods of time, and that, I think, is the source of much of the toxicology that we have for many approved drugs on the market today. My concern with specific targets is safety, especially in this patient population. Dr. Zirwas, I don't know if you can hear us now, but if you can, maybe you can comment on the importance of safety and tolerability, especially in a mild to moderate atopic dermatitis population. Absolutely, Todd. You know, as someone who's been an investigator on most of the JAK trials done in atopic dermatitis and has treated hundreds of patients with them, they certainly are very impressively effective drugs, but the adverse event profile is a real challenge. So the frequency with which patients are hesitant, extremely hesitant to use a JAK inhibitor for atopic dermatitis is high, because, you know, we have to discuss the boxed warning that comes along with all JAK inhibitors. And in a disease like atopic dermatitis, safety is very paramount in these patients' decision making, whether we're talking about, you know, young children, or adolescents, or adults, or even the elderly. Safety becomes a very big differentiating factor in choosing a therapy. It really a drug like, you know, the ADX profile of drugs, these RASP inhibitors, really are completely novel, truly, completely novel in the approach to treating atopic dermatitis. So just a very different direction from anything related to the JAK-STAT, or TYK pathways. Thanks, Dr. Zirwas. Thank you. Kelly, your follow-up question. Yeah, thank you very much. Also, how do you think about the development path for 629? Oh, I would say, I should say, 246 in atopic dermatitis. Do you see it as a standalone therapy and the target milder to moderate rather than severe patients? Also, do you see potential of a combination therapy from this novel mechanism of action? Well, I think, Kelly, one of the benefits of having a novel mechanism of action is that you can combine with other therapies that have a different mechanism of action. As was stated in the slides, regarding the protocol today, we had patients on Dupi in this trial, we had patients on topical corticosteroids, and all patients got better. So I think we have at least preliminary proof of concept that you can combine ADX-629 and, and presumably ADX-246, with more traditional therapies. And, and as you pointed out, the safety profile of ADX-629, at least in this trial, was highly favorable, with only two mild adverse events. I think the future could hold either monotherapy, possibly for milder patients or for moderate patients, a combination therapy as well. Thank you very much. Thanks, Kelly. Your next question comes from the line of Marc Goodman of Leerink Partners. Your line is open. ...I thank for taking my question. This is Rudy on the line from Mark. So I have two questions regarding your development path moving forward. So first, just a quick follow-up, like how do you make a decision whether you wanna do mild to moderate AD instead of more severe patients? Maybe talk about your rationale. And secondly, regarding the doses, do you plan to run a dose-ranging study? Maybe just talk about how do you determine the right doses move forward and based on the data you have from either 629 or 246. Thanks. Good morning, Rudy. Let me ask, let me answer the dosing question first, and then, we'll, we'll go to mild to moderate, versus severe. ADX-246 will, will undergo a single ascending and multiple ascending dose ranging in phase I prior to initiation of the phase II portion of the trial, which, as I mentioned, is expected to involve 30 atopic dermatitis patients randomized to drug and placebo. The target levels of any RASP modulator have to do with the typically observed levels of RASP, in plasma. Those are usually single-digit micromolar levels. Obviously, in diseased patients, levels of RASP are higher than in normal, healthy volunteers. So in phase I with 246, as we did for ADX-629, we hope to dose range upward to achieve a plasma level of drug that's, a low single digit, micromolar. We were quite successful in doing that with ADX-629. Regarding the decision about mild to moderate versus severe, let me just make a statement about the regulatory case with atopic dermatitis, and then I'll turn it over to Dr. Zirwas to comment on the relative proportions of the populations. The FDA requires IGA scores of zero or one to be different between drug and a placebo. So typically, in drug development, we want patients that are somewhat sick because if they're very mild, many patients will get better on placebo. You also don't want patients that are too severe because they're intractable or more difficult to treat. So the secret is enrolling a mild to moderate population, possibly biased towards moderate, so that we can see a sufficient number of IGAs of zeros and ones that are greater in the drug group versus the placebo group. That phenomenon, by the way, Rudy, is the same for almost any clinical trial in any indication. You want a moderate population that's not too sick and not too mild. But Dr. Zirwas, perhaps you can comment on the relative proportions of patients that are mild to moderate versus moderate to severe. Absolutely. So we, you know, we know that the number of people with atopic dermatitis in the U.S. is in the 2.5-3 million-person range, where that's with moderate to severe disease. We, we know, though, that, you know, there are upwards of 15-20 million people in the United States with atopic dermatitis. So we know that the vast majority of disease, so 70%, 80%, 90% of patients with atopic dermatitis have mild to moderate disease, and that is where there's a real unmet need. So for there to be an oral therapy for individuals who have mild to moderate disease would be incredibly useful and fill a real unmet need in the atopic dermatitis space. So for, you know, severe, you know, moderate to severe disease, we already have multiple agents and, and multiple other... multiple additional systemic agents on the way, for people with moderate to severe disease. And all of those, therapies have limitations, whether they have to be administered by injection or they have safety concerns. But in the mild to moderate space, which is a much bigger portion of the, of the atopic dermatitis population, we don't have any oral therapies, let alone any oral therapies that are as safe and well-tolerated, as the ADX molecules are. And so the unmet need, where patients would really prefer a safe, well-tolerated oral rather than having to use creams or ointments or lotions that are time-consuming to put on and can be messy and just are generally not that effective historically versus a simple pill that they're gonna take once a day. It is really a no-brainer that these patients will prefer that oral therapy. Got it. Very helpful. Thank you. Thanks, Rudy. Your next question comes from the line of Tom Shrader of BTIG. Your line is open. Good morning and congratulations. It's nice, nice, nice readout. Firstly, for Dr. Zirwas, can you educate us a little bit on the natural fluctuation of these patients? How often would you see a patient resolve in the placebo group? And then a quick follow-up for Todd. Remind us why you're changing molecules. When you have a signal, why are you taking on new molecule risk? And are the molecules very related? Is it a pro-drug, or are you taking on a truly new molecule? Thank you. Dr. Zirwas, do you wanna go ahead with the first question? Yep. So it's actually been very interesting recently. There's been new data coming out, linking sort of placebo response rates to baseline disease severity in especially the phase III trials that have come out. And really what we would expect is anywhere from 10%-30% depending on what endpoint we're looking at, anywhere from 10% - 30% placebo response rate. The individuals who were in. That's in a typical clinical trial. In this particular trial, which admittedly was small, these were patients who were generally well known to me and were on stable baseline therapy. and so I actually would have expected even a lower placebo response rate than a normal clinical trial, where we're implementing things like moisturizer, standardized skin care, sometimes adjunctive new topical therapies to go along with the systemic therapy. But with the natural waxing and waning of the severity of disease, would have expected a placebo response rate of probably in the 10%-20% range. Just to clarify, when you say response rate, does that mean the rate to clear or the rate to reduce some percentage? So the rate to reduce some percentage. So whenever I'm talking about EASI-75, that's where I'm talking about. I would probably expect about a 10% placebo response rate in this group. Great. Thank you very much. Tom, your question about 246 is a good one, and thank you for asking. ADX-629 is a signal-finding molecule. It is of the era of our first-in-class RASP modulator, reproxalap, and therefore, I think ADX-629 will wind up in orphan diseases with rare patient populations. Instead, we'll transition our mass-market diseases, such as atopic dermatitis, to our next-generation RASP modulators. We detailed the results of the early results of some of those RASP modulators in our R&D Day last year. ADX-246, as we mentioned in the slides today, is the most potent RASP modulator that we're aware of at this point. It is perfectly designed at this point, we believe, to be orally administered, and we eagerly await the phase I results early next year. I would say that in general, ADX-246 is a more active, potentially more bioavailable and newer RASP modulator than ADX-629. Okay, great. Thanks for the detail. Yep. Thank you, Tom. Your next question comes from the line of Yigal Nochomovitz of Citigroup. Your line is open. Hi, Todd and team. Thank you for taking the question. I just had a question on the design of the phase I/II. Could you just clarify why you're enrolling the healthy volunteers? Presumably, you already have a randomized trial versus placebo with the AD patients. So I'm just curious, are the healthy patients getting randomized as well, placebo versus 246, or is it just a separate cohort just with drug to get some additional safety data? Right. That's correct, Yigal. ADX-246 has not been in humans, and so 246 will initiate phase I clinical testing, as I mentioned in my response to Rudy's question, in a single ascending and multiple ascending dose format. I think, more recently, companies have started to combine a phase II component with their phase I, so that as the single ascending dose cohort rolls into the multiple ascending dose cohort, you could then continue the trial in patients in a sort of a phase I/II format, and that's exactly what we intend to do here. So first, we need to identify a safe well-tolerated dose that reaches target plasma levels that we'd hope to reach, given the levels of RASP in inflamed patients. We'll initiate sort of a phase IIa, a trial as part of the same protocol in atopic dermatitis patients with 246. Okay, got it. Then maybe for Dr. Zirwas, you referenced what you would expect in this population, about a 10% response rate. If you were to impute that on this in the placebo, and if you were to impute that on this cohort in this small study, what would be your conclusion? Would this still reach a clinically significant results or just could you comment on that? Thanks. So yes, absolutely. I would say when with a new phase III readout happens in the AD space, just as a little bit of background, I'm an atopic dermatitis specialist and work with all of the drugs that are on the market and pay very close attention to the entire space. And when a new phase III drug reads out, the numbers that I am looking for, kind of the standard results are something like 30%-40% drug response rate and about a 10% placebo response rate. So right in line with what we saw for these results. Okay, and then just one more question. I don't think it was covered, but with respect to looking biochemically at reactive aldehyde species, Todd and Dr. Zirwas, obviously, the skin is a very accessible organ in terms of biopsy. Was that up to some sort of a secondary endpoint in the randomized trial to look at suppression of RASP in the skin? That would be interesting. Yeah, I, I agree, Gaul. Possibly one day, we can, we can do something like that. RASP are notoriously difficult to measure in tissue, mostly because the assays in tissue aren't as well developed as they are for plasma, and secondly, it's difficult to know exactly what part of the tissue to, to assay. But I do think one day that's a possibility. Broadly, RASP affect systemic disease. That is, even for diseases like psoriasis and atopic dermatitis that are manifested in the skin, RASP are involved systemically. So our thesis, and I think this has been proved out with the data that we presented today, not only in atopic dermatitis but as we previously disclosed for other diseases such as cough and COVID and asthma and psoriasis, that modulation of RASP systemically may affect diseases that are manifested more locally. Your next question comes from the line of Catherine Novack of Jones Research. Your line is open. Hi, good morning. Congrats on the data. I'm just wondering if you can comment on the use of Dupixent in the study. Can you tell me how many subjects were on at the start, and what kind of response or improvement they'd had, you know, prior to the study on their other treatments? Thanks for the question, Katherine. We had one patient on Dupixent. We could tell no difference in response across any of the patients. That is, all patients improved, whether they were on Dupixent or topical corticosteroids. I believe we had two patients on topical corticosteroids throughout the duration of the clinical trial, which I think highlights the ability of RASP modulation broadly to be administered with, I think, standard of care therapies. To enroll in the trial, patients needed to be on a stable dose of their prior medication. As Dr. Zirwas said, these patients were not adequately responding. Otherwise, they wouldn't have qualified for enrollment in the trial. To the extent that we made all of these patients somewhat better and a good number of patients significantly better, even against the backdrop of concomitant therapy, I think is a good sign for RASP modulation in this disease. Okay, great. And then my next question is for Dr. Zirwas. Can you, you know, talk about the treatment algorithm for mild to moderate patients? You know, if they, you know, you don't see improvement on topical corticosteroids, you know, what are the primary prescriptions that you tend to write in this population? Yeah. So in the mild to moderate space, and it's one of the challenges with atopic dermatitis in general, that mild to moderate versus moderate to severe is defined by the appearance of the lesions, not by how widespread they are. And so one of the challenges that we often face, and one of the most underserved groups right now, are people with mild disease that is widespread. So you can have severe disease covering, you know, 1% body surface area. You can have severe disease covering 90% of your body. Alternatively, you could have mild disease covering 1%-99% of your body. And so typically, for a mild to moderate patient today, we're gonna start by giving them topical corticosteroids, usually medium potency. If that is inadequately effective, we're likely to move up to a high-potency topical steroid. Then if that's inadequately effective, we're likely to then go to a topical calcineurin inhibitor. If that is then ineffective, we're likely to go to a topical JAK inhibitor. Now, with any of these therapies, for mild to moderate disease, we might use a short-term systemic therapy currently. So typically, that would be an oral corticosteroid like prednisone or an injected corticosteroid like triamcinolone to try and calm the disease down acutely and then maintain it topically with prescription therapy. And so that area, though, those groups of patients are who the RASP inhibitors will make so much sense for because it would be a... You know, what I am imagining as a clinician is somebody comes in with atopic dermatitis, we put them on a low-cost, easily accessible, easily accessible topical steroid for the short term while we start the RASP inhibitor orally at the same time. And then within a fairly short period of time, two weeks, four weeks, six weeks, we're able to get them off of the topical steroid and just maintain them on the RASP inhibitor. Is sort of the approach that makes very much sense to me as a pragmatic clinician. So maintaining what I would call our current standard topical approaches as an initial starting point of therapy, but then adding the RASP inhibitor so that we're able to get the patients off of the topical therapy and let them go on with their lives. Okay, that's helpful. Thanks very much. Thanks, Catherine. Your next question comes from the line of Yale Jen of Laidlaw & Company. Your line is open. Good morning, and thanks for taking the questions, and congrats on the outcome. Two questions here. First one for Todd, that you reported that the previous study in the psoriasis, and so just curious, what's your thought in terms of is that going to be something for two, four, six, for both indications, or what, what's the plan here going forward? Well, I think unlike atopic dermatitis, the psoriasis market is relatively well-satisfied for a safer, orally administered therapy for mild to moderate patients. That is certainly not the case with atopic dermatitis, and I, I would expect that, our initial foray into, immune-mediated diseases of the skin for 246 would, be limited at this point to atopic dermatitis, for market reasons. Okay, great. That's very helpful. Maybe another follow-up here is that in terms of the future study design, maybe even beyond the next phase II, are you going to plan to do a combination study with corticosteroid? And also whether you are thinking about the pediatric population in the future? And thanks. Yeah, I think, Yile, those are all excellent ideas and will no doubt be covered in subsequent clinical trials. Initially, I think most companies attempt to focus on naive or treatment-naive patients, or patients that have withdrawn from concomitant therapy. I think we're seeing a trend these days for the addition of concomitant therapies to clinical trials, to sort of simulate a more real-world environment. But these are all discussions we'll have with the FDA in the near future, and I would expect the answer to your question will evolve over the next 12-24 months. Your next question comes from the line of Matthew Caufield of H.C. Wainwright. Your line is open. Great. Hi, Todd. Thanks for the updates this morning. Is there a sense, just from an overall strategic standpoint, which systemic RASP programs have the highest developmental priority at this point? And then separately, can you remind us of where things stand for the possible AbbVie development plan related to reproxalap? Thanks a lot. Great. Thanks, Matt, for the questions. By the end of the year, we will give an update on the systemic RASP platform broadly, which will include ADX-629 and some additional information on ADX-246 and possibly ADX-248. I would say, at this point, the focus of ADX-246 is in atopic dermatitis. As I mentioned previously, the focus of ADX-629 will be in orphan diseases, and the focus of ADX-248, as I mentioned in my prepared comments, will be on retinal disease. But we look forward to updating by the end of the year as to the specifics of the systemic RASP platform, and then, potentially, in the first half of next year, we can hold an R&D day to go into those compounds and their indications in more detail. Regarding AbbVie, as you know from the previously filed 8-K, AbbVie has the option to extend the current option agreement. That option expires on the twenty-third, unless a payment of $5 million is made prior to midnight on the twenty-second, which is this Friday. Okay, great. Very helpful. I appreciate that. Yep. Thank you, Matt. There are no further questions at this time. I will now pass the call over to Todd for some closing remarks. Well, thank you, as always, for joining us this morning, and we look forward to updating you on our future progress. This concludes today's conference call. You may now disconnect.