All right. Welcome back to the TD Cowen Genetic Medicines and RNA Summit. I'm joined today by VP of Finance and IR at Arrowhead Pharmaceuticals Vince Anzalone. Thanks so much for joining us, Vince. Thank you, Brendan, and thanks to the whole TD Cowen team for having us today. Yeah. Yeah. So we've got a lot of ground to cover and not too much time here. So I think we'll kind of just dive in. I just want to let everybody know who's listening in from home or the office. You can either send us questions directly over email or on the online dashboard, whatever your preference is. Again, we got a lot of ground, so let's maybe just get going here. So let's get started with plozasiran. This is the ARO-APOC3. Obviously, recently released the phase III PALISADE data, at least top-line data. This is an FCS. So it's pretty much best-in-class triglyceride lowering and ApoC3 reduction. It looked like the data was about, if you factor in placebo arm, about 63%, 61% placebo-adjusted reduction in triglycerides. Maybe if we can kind of first level set, looking ahead to additional data that we might get from the full phase III set later this year, what are you kind of hoping to benchmark there? What else should we be watching for? And how do you think that could potentially shift what we know about the drug so far? Sure. So thanks for that question. And yeah, I want to start before I get into what data we're going to have and the expectations, just level set where we are with that particular product and our enthusiasm level. So all along the way, starting at phase I, which included, I think it was 4 genetically confirmed FCS patients, plus healthy volunteers, plus patients with moderately elevated triglycerides and severely elevated triglycerides in phase II, and then ultimately to the mixed hyperlipidemia population also in phase II, and then the genetically confirmed and clinically confirmed FCS patients at phase III. We've kind of hit the continuum during our clinical studies all along the way. And we have continued to get more and more enthusiastic and excited about that product profile. The data have continued to look better and better all along the way. So we are full steam ahead with investing in the future of that. That includes the large phase III studies for sHTG and also commercial build-out. Then we'll talk more about this next week at our R&D webinar that's focusing on cardiometabolic. We also have plans to look at what that broader ASCVD population, how it's underserved, and which molecule, plozasiran or zodasiran and kind of what designs would be best for us as a company to move forward with that large population. Again, this is kind of our level set moment where we have been really encouraged by all these data all along the way and, again, are full steam ahead with investment and future for this part of our pipeline. Now, your question about what data we would expect in the future and what could kind of change the way that people view it, frankly, I don't want any change. The truth is that every single point in that, at least from the top-line data, every single point of that study has been as or better than expected. Let's start with the primary endpoint. The press release just covered top-line, which means primary endpoint and then all the kind of statistical hierarchy secondary endpoints. We'll get into more detail in this call, but certainly later in the year about what those are and downstream of that, what other measures are important. With respect to those, the primary endpoint and the key secondaries, we hit statistical significance on all of them. That was something that was important for us. It starts at the primary, which is TG lowering versus placebo at month 12 or I'm sorry, month 10. The reduction from baseline was in the 80% or so range of triglycerides. This is a severe population. As you mentioned, the placebo-adjusted number is 17% lower than that because placebo, at that point in time, we kind of got a blip and placebo went down. But the bottom line is the 80% reduction from baseline is really what physicians want to see. They want to know if my patient comes in with severely elevated triglycerides in the thousands, how low can we get it? That's the number that matters because, again, once it's a commercial product, patients don't take placebo, so that number doesn't make a difference. And then, going down that statistical hierarchy of endpoints, we hit the TG lower and we hit APOC3 reduction, which was approaching 95%, I think, the two different 90% and 95%. So essentially, almost full suppression of the liver production of APOC3, which is the gene target for that drug. And then there's a couple of other measures of PD. And then the bottom secondary endpoint that also, again, we hit statistical significance on was the reduction in the occurrence of acute pancreatitis during the study. Now, that's also critical because think of what causes this disease. It's patients who have either a single genetic mutation or multiple genetic mutations or other causes that make it so they're unable to clear triglycerides effectively. And so it just builds up in their blood. And that causes a number of quality of life issues. These patients have severely restricted diets. I think they can eat the equivalent of a tablespoon of olive oil and fat per day. They're constantly thinking about their diet. They have this brain fog and abdominal pain. Then ultimately, the clinical syndrome can result in acute pancreatitis if their triglycerides spike postprandially and they get into trouble. What you're trying to do is reduce APOC3, which will then reduce triglycerides and then reduce the occurrence of pancreatitis and then all of those quality of life issues. The crux of your original question, what else will we see? It's measures of all of those things: drug activity, triglyceride lowering at different time points, some of those kind of patient-reported outcomes, and also the acute pancreatitis number. Now, one thing I think that's important, it's not in the statistical hierarchy of those endpoints, but it's something that we think is important for physicians, is how many of these patients are you getting down to a triglyceride level that's below the threshold that's commonly predicted as being at risk for acute pancreatitis? And that's typically the 500 mg/dL in fasting triglycerides. So those data, I think, will be helpful for us to show. And then how many are you getting down below 880, which is also kind of a critical risk point? So if we can get more patients down into that low-risk threshold, then it kind of opens up the possibility that we really will have a good downstream effect on acute pancreatitis and the other quality of life measures. Gotcha. Gotcha. Okay. So a lot to unpack there. I want to first touch on something that you mentioned here, this genetically versus clinically confirmed FCS. We've gotten a few inbounds the past couple of months, honestly, from yourselves and some of your competitor data relative to both of them, just about the relative contribution of those different populations to the potential placebo response. So I guess my first question is, based on what you're seeing, I guess maybe first, are you able to disclose what the relative proportion of genetically versus clinically confirmed FCS patients is? And if not today, maybe when we will get it. But also, how realistic is it that maybe more clinically confirmed patients seem to actually show TGs going down over time? I'm really asking because we've seen some evidence that genetically confirmed alone might actually go up over time. So just trying to understand how to kind of level set these different populations and if we would expect any input from FDA there. So when you say the genetically confirmed might go up, you mean on the placebo arm? Yeah. Yeah. I guess that so the way we view those two populations is not really any distinct disease. So one of the things that would, or one of the factors that would move somebody from clinically confirmed to genetically confirmed is if there are new monogenic mutations that are identified that lead to the exact same disease. And I know that even since we started this program a number of years ago, there are more known genetic mutations that are now considered genetically confirmed FCS. And it needs a genotyping assay clinically to figure out if they are on that list of mutations. And again, that list of mutations grows, but it also may be multiple different genetic mutations that, again, that leads to LPL deficiency or another reason why they can't break down and clear triglycerides effectively. We don't view the actual disease as all that different, but the cause might be different. I guess I can't really comment on whether we would expect the placebo to be different in those two. We don't have those data at this point. But if their fasting triglycerides are around the same level, then postprandial spikes in triglycerides should be basically the same. And when you're talking about differences of hundreds in baseline characteristics when they're already in the thousands, they're already on both sides, the genetically and the phenotypically confirmed. So we really wouldn't expect all that much different, but we haven't seen the data, so it's not like I can't comment for sure on that. Okay. All right. So we wouldn't expect anything from FDA in a potential label to need to distinguish between genetically versus clinically confirmed? I couldn't speak for FDA on this. I think that the way a label is written is based on the indication statement that you propose to the FDA, and you propose an indication statement based on the patient population you studied. That seems to be a logical step, that your label is not more restrictive or less restrictive than the patient population you studied in a phase III well-controlled clinical trial. Again, we have work that we need to do with regulators here in the U.S. and in Europe and abroad before we have a better idea of what that would look like. That would be our expectation, that we would have a label that is reflective of the patient population we study. Okay. All right. Fair enough. I also wanted to ask just because you touched on it a little bit, ahead of the R&D day next week, are we going to get a firm decision on whether you're taking plozasiran or zodasiran into the cardiovascular outcome study? Well, we certainly intend to give an update on that. I don't want to blow a punchline here, but we are certainly intending to give an update on where we are. Now, can I take just a minute to talk about the process that we've gone through? Great. So originally, we had drafted and interacted with regulators on a phase III study for plozasiran that looked. We were pretty close on that last year. And then we had some data from the phase II studies of zodasiran in the ANGPTL3 program that showed it was very active against remnant cholesterol, which is a much increasingly appreciated risk factor for cardiovascular disease. And to be fair, plozasiran also has a dramatic effect on remnant cholesterol. But I think that there was more of an appreciation of the potential for zodasiran than we originally appreciated. And so we thought for a company our size, I guess any company, even the largest companies in the world, have to go through this exercise. It's critical for a company our size to do the proper analysis and exhaustive analysis before we decide to make an investment in a cardiovascular outcome study that we're making the right decision and that we know all of the different permutations that are possible, what the different patient populations that we may study, the sizing of clinical trials that are going to be large and long, and then do a good amount of modeling and design work to figure out what we would predict the effect size would be for each of these agents. Then also, if the populations are going to be different, what's going to be the background event rate for cardiovascular events during a reasonable amount of time after a clinical study starts? So essentially, to throw out a plan and not start over, but do an additional analysis of one agent, the other agent, or both agents, and then what would be the outcomes? And then what are we most confident in investing in the future? And so we started that process towards the end of last year. We brought in many external experts and advisors, names that all of you on the investment side would know, and really decided to do the proper analysis. And then we decided to take some of that analysis and have a draft plan that we interacted with regulators around. And that happened over the last quarter or so. Now I think we feel more comfortable that we have our eyes wide open on what the potential study designs could be and then what is right for us as a company at our size and at our stage. I think we feel pretty confident. We definitely will give an update next week and provide more detail on that kind of process and where we're landing on that. Okay. All right. I know we have a lot of ground to cover, and we're already kind of halfway through. So maybe one last question on cardiometabolics. So I mean, the sHTG studies with zodasiran now are up and running or about to be. I think kind of similar thinking with the zodasiran HoFH study. This is up and going now as well, right? The HoFH phase III is not up and running yet. We wanted to get the sHTG phase III studies started as quickly as we can. The HoFH is not started yet. Okay. All right. But I guess just because you kind of mentioned a little bit as well, I know there's been some conversation about funding the cardiovascular outcome study. Obviously, this is a really sizable undertaking. From an investment perspective, I mean, what's kind of the latest update on potential BD partnerships or commercialization partnerships? Are we going to get an update maybe next week or sometime in the coming months? Where does that kind of stand? Yeah. I'm always reluctant to give timeline guidance on financing or business development or things that are partially in our control and partially out of our control. And also, I don't like doing that myself, to be honest with you. So I won't give any kind of timeline guidance on that. I'll give you philosophy and our strategy there, which really hasn't changed. It is the same strategy we've had for a number of years, which is that we want to fund operations before we're cash flow positive, which we're not there yet because we don't have even an approval yet for plozasiran. But if things go the way we expect them to on the commercial side, we now have kind of a more narrow and finite time that we need to solve for with financing needs. We can kind of see a point in the future where commercial revenue takes over our need for other sources of capital. Again, we're not there yet, but we have it kind of in our view in the future. I think that over the next year or so, we'll start to get more specific externally about what we expect as far as commercial revenue. The financing, we have over the last handful of years brought in about $1 billion or so in business development cash, not bio bucks, but actual cash in the door, and somewhere around $700 million or so in equity, about $300 million in kind of creative or royalty-based financing. So I like, moving forward, using that same basic idea and the same strategy. The ratios likely will be different, but that makes sense to us. As a platform company, one big benefit is that our technology allows us to do discovery and early development on way more products than we will take to market ourselves. And so we will continue to use business development as an important source of capital. As we get closer to commercialization, and again, as I mentioned, commercial revenue that is in the not-too-distant future, we can start to look at maybe bolstering the kind of royalty-based or creative side of the equation, and then also potentially add some type of debt that makes sense for our stage. So again, I think all four of those buckets are going to be represented in our financing strategy moving forward. And we know that our balance sheet needs to be stronger. It just does. We're not making investment decisions day-to-day based on the amount of cash on the balance sheet. Over the long term, it's something that just needs to be solved. We will take steps in the short term and in the midterm to solve that. Okay. All right. Great. So I want to shift gears a little bit over to pulmonary because obviously there's a lot of interest here, a lot of exciting things going on here. So I think on last earnings call, basically said that you didn't see, "Okay, we're going to move to phase II in asthma." This was with ARO-RAGE. I want to check in on the high- FeNO asthma cohort, where enrollment stands there, when we might potentially get data. I understand it's still enrolling. And then what really drove the decision to just kind of forego that high- FeNO data before you started phase II? I was thinking this. Sure. So the gating item to start a phase II study for ARO-RAGE wasn't the availability of data in high-FeNO cohorts. It was chronic tox and some regulatory work and some design work and to select a dose and also a dose interval, which needed more complete data from the phase I/II on the duration of effect. And so the high- FeNO cohorts were more opportunistic. So we knew that we had some time before we would be able to start a phase II. And this was, gosh, towards the end of last year or early this year. So our pulmonologists and some of our external advisors, we went to them and we said, "What else can we learn at this stage about the molecule and about PD and any kind of downstream signals? What else is there that we can learn?" The consensus was that FeNO, as a measurement, is potentially reactive. It's IL-13 driven. One of the pathways or one of the pathways that RAGE is potentially involved with is IL-13. Preclinically, we did see a reduction in IL-13 once RAGE inhibition was high in animals. So we thought, "Let's take a look at that." But again, it wasn't gating for anything in a phase II. Since the enrollment has been slower than we expected, and I'll talk about why that is in a moment, since the enrollment was slower, we thought it doesn't make any sense for us to delay a phase II for the availability of data that isn't necessary for regulatory or for clinical to assess the design of a phase II study. So we're moving ahead with that. We still want to complete these high- FeNO cohorts and see what we see. But it wasn't gating. Now, the one part of your question about why? Why is this enrollment slow and when can we expect data? So we opened up these cohorts. I'm going to get the timeframe wrong, but somewhere early in the year, Q1 or so. And we opened up a couple of centers. I think we have since opened three or four or maybe a couple more than that. And we had patients that came in that met the inclusion criteria that were enrolled in the study rather quickly. And the challenge from then to now is that FeNO is not something that's in clinical practice. It's typically measured or tracked. And so when these physicians were calling their patients to have them come in to screen, they couldn't be. It was kind of indiscriminate, right? They couldn't identify patients who had high baseline FeNO. And so there was a lot more screen fails than we thought we would have. There are patients with high baseline FeNO, but they are harder to come by than we originally anticipated. And then second, there are other, there's biologics out there that are getting, that are used quite commonly. And so we're competing with that. And there's other clinical studies that may be later in stage. Remember, this is a phase I/II, but it's only two doses. And so it's short exposure. And so the goal of these high- FeNO cohorts is not to see if it affects asthma. It's not to look at downstream clinical changes. It's a biomarker study, basically, to see if there's in patients with asthma, if we're seeing a reduction in FeNO, which is a biomarker of a biomarker. If we're competing with other studies that patients may actually get a benefit in their asthma treatment, then that was more challenging as well. None of these things we can't overcome. It's just taking more time than we expected. That's why we thought it was important on our last earnings call, just to make sure that we are level-setting with expectations publicly, because that would have been the last time for us to give that update until our next earnings call, which is in August. We want to make sure that the street understood that we're likely not going to have an update in Q3. As far as when we will, is it one quarter delayed or two quarters delayed? We just don't know that yet. We'll give an update when we can. Okay. All right. Great. I also wanted to ask, there's obviously a lot of buzz around the TSLP targeting drugs. You mentioned IL-13 as well. I mean, can you help us understand RAGE? Where does it kind of sit at the intersection of each of these and how much any phase II data you might potentially read through to some of these other indications that we're seeing? I mean, we've seen good success with TSLPs and COPD, obviously, and asthma, potentially chronic bronchitis. So I guess, how are you thinking about that? And just kind of help us level-set RAGE relative to TSLP and IL-13 now. Sure. So you're not going to like this answer, but I'm going to punt on that for now. So I would say that we are doing this summer series of R&D webinars. One of them will be pulmonary, and that's actually in less than a month. It's in July. And we're going to go into the RAGE pathway and kind of comprehensively describe where it sits in that cascade. This is not going to be all that specific, but it does sit upstream of TSLP. And so our expectation is that we would be looking at kind of similar populations. It might have a broader application than the approved TSLPs out there. But again, we'll go into a good amount of depth in that RAGE pathway next month. But it's something that's really exciting to us, and it's something that's been very well described in the literature, and it's very encouraging preclinical data with potent anti-inflammatory effects when RAGE is inhibited in the lung. And so it has all those hallmarks of being an exciting target. It doesn't have the hallmark of being clinically validated. So the target itself hasn't been accessible. And so it's not something that we have that we can point to a precedent clinically that if you inhibit RAGE by X%, then you're going to get all of these different pathways inhibited as well. I would say, since it does sit upstream of TSLP, I would say the pathway is validated, but the target itself, I think that it is not at this point. Yeah. Okay. Fair enough. And then maybe just one last one on pulmonary. I know we have MUC5AC and MMP7 data. Can we still expect patient, I guess, primarily patient data from both is going to be asthma and then IPF patients with MMP7? Are we still going to get both of those programs by the end of this year? I think so. There's nothing has changed as far as timelines there. We're in the process of enrolling patients for both of those programs. Just to be specific here, the healthy volunteer portions are either done or close to done. So we have a baseline for safety evaluation, which you need. That's the first thing you need to put a check mark in. Then the next step would be target engagement. Now, RAGE had the benefit of having a circulating biomarker that we could look at in healthy volunteers. So we could look at target engagement healthies. With MUC5AC and MMP7, we don't have that. The only way we can assess target engagement is in the patient population for different reasons, actually. MUC, it's because it's not expressed at a high level in healthy volunteers and upregulated by 5- to 30-fold or so in patients with asthma. And then with MMP7, that's actually only expressed in a cell type that doesn't really exist in healthies. It's only in patients with IPF. So we're enrolling both of those patient populations now, and we're eager to see those data, as are you. Gotcha. Okay. All right. So just beyond that, I guess one last question here in the last minute here. I think we're supposed to also get some ARO-C3 data this year. Is that correct? I guess maybe level-set when we might see that and how you think about that program relative to the other pillars. Sure. So we just presented a poster about a week ago on ARO-C3. It was still just healthy volunteer data, but the profile looks really good. I mean, we're looking at many measures of complement as well as just target engagement itself. So that poster is up on our website if people want to take a look at that. The patient portion, which is probably what you're asking about, is we are right now enrolling patients with IgA nephropathy and C3 glomerulopathy. And I'm kind of flat-footed on this. I actually don't know when we expect those data to be available, but we are in the process of enrolling. And I can't recall how many dose levels we're looking at there, but that's not—that is certainly in the near term, less than 12 months and potentially by the end of the year. Okay. All right. Great. And with that, I know we're right at time. So thanks to everybody for listening in. Thanks so much for joining us again, Vince. Always a pleasure to catch up. And stay tuned for the next session, everyone. Sounds great. Thank you. Thank you.