Hi, everyone. My name is Maury Raycroft, and I'm one of the analysts at Jefferies. I'd like to welcome our guest today, Bruce Given, CMO at Arrowhead, who's joining us for a fireside chat. Thanks so much for joining us today, Bruce. Yeah, my pleasure. Always happy to be here. Maybe to start off, for those who are new to the story, if you want to give a one-minute intro to Arrowhead. Sure. We're a platform company. Part of what challenges those who follow us is that they can't focus in on just one drug or one program because we have just a slew of exciting programs. We also run a hybrid model. Most of what we discover and bring into the clinic will eventually wind up in partners' hands and not ours. We discover way too many really good compounds for any company other than maybe a Merck or a Pfizer to be able to develop them all if they could even discover that many good compounds in a year. That's our model. That sometimes creates some challenges in following as well. We have a drug pending at the FDA and EMA, for instance, right now. We're just pre-commercial. By 2028, we'll probably have on the order of three or four drugs, hopefully on the market, two in the hands of partners and two of our own. That kind of maybe nutshells it. Yeah, yeah, I think that's a good intro and overview. You mentioned the drug that's with FDA right now, plozasiran. It's for APOC3. Wanted to check to see if there's any update on feedback you're getting from FDA and any perspective into timelines, potentially even a late AdCom for this program, given the changes in leadership there. It's always a challenge to know exactly what the FDA is going to do. So far, we've been advised that no advisory committee is expected. So far, the interaction to us feels normal. That's about the best we could do. I mean, we have our PDUFA date in November. Like everyone else, we're looking at what's going on in Washington and scratching our heads as well of, will it have an impact on us? We haven't been told it's having an impact. We haven't seen an impact. That's about the best I can give you. Okay, makes sense. I know you're not in label discussions yet. What do you expect your label to look like relative to Ionis Tryngolza with regard to patient population and just wording around reduction of acute pancreatitis? I know even less about that than what I just said because, again, with the agency, they ask you questions, but they do not answer. We do not give them questions, and they do not answer questions. Ultimately, we like our package. We like the data that we produced. We think everything was produced in a proper way. Ultimately, what gets into labeling is, yes, it is a discussion, but nothing gets in that the FDA does not want in. Yeah, yeah, it makes sense. You may ask for pancreatitis as part of the clearance button. Sure, sure. Yeah, I don't think it's likely that the agency is going to give anybody an explicit claim for pancreatitis, not on the basis of a 75-patient study per se. But Ionis did get pancreatitis in the label, even though they weren't statistically significant in their trial. They got the mention. I would hope that we would get similar treatment given that we were statistically significant in the trial. Again, I've learned over the years that in the end, the FDA will do what they decide to do. Right, yeah, it makes sense. Maybe talk about pricing relative to Ionis in the United States and EU5. I'm wondering if you can comment on potential differences in how payers may view plozasiran relative to Ionis. Yeah, yeah, also a hard question to answer. I mean, in the U.S., I mean, obviously, Ionis being on the market has sort of set the game. We would expect that we'll be in their neighborhood in the U.S. Europe's a more complicated issue just because you have the national payers. They do their own assessment. This is something that maybe is not always that well understood by investors. The EMA approves the drugs in Europe. That's just kind of the opening ante. The real game comes down to how the national payers view a drug and how they view it in the context of how they want to see a disease treated. Ionis is not yet on the market in Europe. They have not yet even started the process with national payers. How that's going to play out in Europe, I think, at this point is really an unknown. Got it. This is for FCS, which is a smaller market opportunity. The plan here is to build the infrastructure, get this approval, and this will allow you to expand into the higher triglyceride opportunity, which could be much bigger. Maybe talk about the three phase III studies that you're running right now, the SHASTA- 3, SHASTA- 4 for SHTG, and then MUIR-3 for mixed dyslipidemia. Talk about the pace of enrollment, feedback from site investigators, and timelines to completing enrollment. OK, first, real quickly, FCS is an orphan disease. Estimates vary and depend on whether you talk about purely genetic FCS or clinical FCS. But we're probably talking about a few thousand in the U.S. if you can get into clinical FCS as well as genetic. Whereas severe hypertriglyceridemia, which is generally defined as patients over 500 mg per dL, is probably around 3 million or so in the U.S. You are talking about a much larger market, much greater opportunity. We have two studies that are specifically in phase III studies in severe hypertriglyceridemia. Then we have a third study that's in mixed hyperlipidemia just to build up the safety database to meet ICH guidelines. All of those studies have enrolled extremely well. We have guided that we expect enrollment to complete this summer. I see nothing that's standing in the way of that happening. The last patient in, basically, that stays on therapy will be followed for a year. We would expect last patient, last visit, again, summer of next year. It will probably take a few months to put together the registration package. We will submit around the world based on that. Once we are able to announce that we have enrolled the last subject, that kind of starts the clock. You will be able to refine your timing expectation. Yes, enrollment will complete this summer. Got it. For SHASTA-3 and SHASTA-4, for those pivotal studies, how much triglyceride reduction do you need to show there? Based on your phase II experience, I guess, how much do you need to achieve with TG reduction in order to hit stat-sig in the phase IIIs? I mean, these are massively overpowered. I mean, we had much smaller studies in phase II. And the difference versus placebo was less than 0.0001. These studies are much bigger. They're one dose versus placebo instead of three doses versus placebo. They're ludicrously overpowered. They're really for safety. What you need to be statistically significant is not much. What we need to be competitive, we'll understand more when Ionis announces their results. What we saw in phase II was around a 60% reduction. The things currently on the market usually give you about 20% reduction. These APOC3 inhibitors are massively beneficial relative to anything that's been on the market before. It's a great mechanism. I would expect we're going to be in that 50%-60% or something. It's the placebo-subtracted stuff that makes it a little bit hard to predict exactly what it'll look like. Got it. Studies are overpowered. I guess the question is, what's the minimum number of patients you estimate you would need to achieve stat-sig benefit? Could you potentially do a 12-month primary analysis on a smaller proportion of patients and accelerate the timeline there for expansion? No, I don't think so. I mean, we could prove efficacy with a tiny study. The whole basis of doing the phase III program really is to get the safety data set that's required by ICH. I mean, again, I think we couldn't accelerate it because it's a safety database that actually drove the whole phase III program. ICH basically wants 1,500 patients treated for 12 months against a placebo control. Our phase II studies were two doses. These studies are four doses to get the full 12-month exposure versus placebo. We can't accelerate it because we can't magically make that 1,500 appear. Got it. Makes sense. What would you estimate the odds are of hitting stat-sig on the secondary endpoint of acute pancreatitis? If you were to combine SHASTA-3, SHASTA-4, and MUIR3 events within that relatively one-year time frame, have you had any conversations with the FDA about doing this pooled analysis? Our focus in severe hypertriglyceridemia is not really on pancreatitis. I think the likelihood of achieving a pancreatitis endpoint in these studies as opposed to an FCS is hard to predict, but relatively low in my view. That is not really what we are trying to achieve in this program. We measure pancreatitis events. We adjudicate them. In the MUIR study, the mixed hyperlipidemia study, we do not expect to see any pancreatitis at all. That is why we are actually doing a dedicated pancreatitis outcome study, which will be the first of its kind ever done. It is not a registrational study per se. It is really for the payers. That study is not on the same timeline and will not be likely included in the registration package. We are doing that study to really settle the discussion once and for all about whether patients with severe hypertriglyceridemia are at risk for pancreatitis. These drugs actually, well, we know they're at risk, but these drugs actually have demonstrated that benefit. That study is up and running. Got it. Ionis, they've commented about potentially pooling their two studies, CORE and CORE 2, and maybe hitting stat-sig on acute pancreatitis over the 12 months. Do you think that could be possible? Have you had that conversation with the FDA about doing something like that? Oh, yeah, we are also intending to pool. There is a nuance here. We actually study definite pancreatitis. The Ionis approach doesn't look at definite pancreatitis. They look at severe abdominal pain, some of which meets the criteria for pancreatitis and some of which doesn't. The FDA let them do that. We don't know whether the Europeans, for instance, will go along with it. We don't know whether the payers, especially in Europe, will go along with it. We chose to be purist, I guess you could say, on this and just look at definite diagnostic pancreatitis and not include abdominal pain that did not meet the criteria for pancreatitis. We don't know how many of their patients, even in their Balance study, actually had pancreatitis. I think they did clearly show a benefit on abdominal pain, but that, of course, is not the same thing. Got it. Interesting. Are you measuring abdominal pain in your studies as well? Sure, we measure that too. We adjudicate for actual pancreatitis. Got it. Okay. Maybe comment on safety and also convenience relative to Ionis. Yeah, yeah. Sure. So olezarsen is once a month. We're once every three months. We tend to, both of us had reasonable, well, they had a reasonable dropout rate compared, for instance, to their predecessor drug, volanesorsen. We had a very low dropout rate across the entire lozasiran program. Generally, patients tolerate siRNAs better than ASOs. I think that's the case here as well. We, of course, have not done head-to-head trials. This is just comparing to cross trials, which is always a tricky thing to do. I always look at discontinuation rates as the biggest indicator of how drugs are really doing in practice. If patients can't stay on a drug, that tells you you've got an issue. Their discontinuation rate's a bit higher than ours. I think that says something. Of course, it was sky high with olezarsen's grandfather, volanesorsen, which is why they had to develop olezarsen in the first place. Got it. Makes sense. Plazasiran is about 3x- 4x more potent at reducing triglyceride levels consistently across patient baselines relative to Amarin's VASCEPA, which is the fish oil mechanism. Looking back, what are the key learnings from VASCEPA's launch in SHTG, which generated about $614 million in sales in 2020? I mean, I think it shows there's a market there. They, of course, really, they didn't have the opportunity to really fully exploit that market before they lost their patent and really lost the ability to effectively market. There's clearly a market there. The number of patients in the U.S., for instance, that are on either a fibrate or a fish oil is very high. It's like 1.5 million. Physicians are aware that their patients have SHTG. They'd like to treat it. We're pretty bullish on the possibilities for the SHTG market. We just think it's an unserved market for all intents and purposes. Got it. Maybe just last question on plozasiran. Just maybe talk about the timelines for inflection points with this program for label expansions and potentially running a CVOT study as well. Latest thoughts there. Yeah. So clearly, the SHTG program, from our perspective, is huge. Mixed hyperlipidemia is still an unserved market. It's about 22 million patients. It requires a CVOT to do. For us, that's a big nut. What we've said is if we have sufficient capital, we would like to do a CVOT in the mixed hyperlipidemia space. At this point, we don't have that capital. We've got a study planned. We know what it would look like. We could start figuratively almost tomorrow if we felt it was the right thing for us to do to invest that. At this point, that's not something that we've been willing to commit to do because it's a huge commitment of capital. Got it. So get the FCS approval, and then you can focus on this SHTG expansion, which is going to be a huge opportunity. Huge opportunity, yeah. Makes sense. Let's shift gears and briefly talk about your CNS programs. Maybe talk about the broader strategy there. You've got a proprietary transferring binding approach for subcutaneous CNS delivery. How can this lead to differentiated efficacy and safety in clinical programs? Maybe talk about ARO MAPT as well. Yeah. You know, I mean, I'm just really bullish on the whole concept of crossing the blood-brain barrier with siRNAs. They don't normally cross the blood-brain barrier. One of the nice safety features of siRNAs, for instance, in something like obesity, is that they don't cross the blood-brain barrier. We don't get accumulation in the brain. We don't have to worry about any potential knockdown in the brain. Obviously, for CNS, it's hard for me to imagine a world where you can really have very effective therapy if everybody's got to get intrathecal injections on a some frequent basis. I mean, you could do that for really deadly orphan diseases. Is that ever going to work in Alzheimer's, for instance? I don't think so. We have developed a subcutaneous platform that works extremely well in primates. We believe we'll be the first in the world to have a trial in humans with, again, a subcutaneous delivery that crosses the blood-brain barrier and knocks down a gene of interest. Our first target is MAPT, which is basically for the tau protein, which has been, I don't know, I first worked with a drug that was supposed to target MAPT back in the 1990s. It's been a favorite target, undruggable target for big pharma going all the way back that 30-some years. We think this is an exciting approach. We'll see if it works. We're excited about it. The other thing about the systemic delivery, different than intrathecal delivery, is intrathecal delivery to get to the high brain, it's got to basically, these molecules have to swim upstream, you might say. With systemic delivery, you really bathe the whole brain. If you can get across the blood-brain barrier, you can get to all the tissues. That is what we see in the primates. We see much better knockdown in deep brain regions that you really want to, for a lot of these targets, like Alzheimer's, like Parkinson's disease, Huntington's, you need deep brain penetration. I think the ability of siRNAs to cross the blood-brain barrier is going to be transformational for the field, not just for us. I think we'll be the first in the clinic. Other people will follow us. Other people will work on transfer, sort of transfer of these molecules. It is going to be exciting, I think. Got it. That NHP biodistribution should translate to humans. I guess, are there any reasons why it would not? Maybe talk about just the chronic PAC studies. So far, in our experience, and we're the leaders in the industry at targeting tissues outside of the liver with siRNA. So far, we've not seen a situation where something that worked in primates did not work in humans. That doesn't mean that this can't be the case. I'm always pretty bullish. If things work in primates, I always feel pretty confident that they're likely to work in humans because we've yet to fail in that regard. This is, I think, going to be important. Got it. OK. Let's shift gears to your obesity programs, where there's also a lot of interest. With INHBE, we'll likely see more data from that program later this year relative to your ALK7 program, which is targeting adipocytes. What's the status of both programs? How are you setting expectations for initial INHBE data in fourth quarter? Yeah, maybe start there. Yeah. The INHBE program got started earlier, maybe even toward the end of last year. I can't remember when the first patient enrolled. Either late last year or early this year, we enrolled our first patient. We're already in multiple dose work. We're already doing combination work with tirzepatide in otherwise healthy obese patients. We'll be getting into obese type 2 diabetics as well. I'm not sure exactly how much will be available at the end of the year. The only reason I say that is just that siRNAs, one of their great advantages is that they have such long duration. When you're anxious for data, one of their great disadvantages is they have such long duration. It takes a while. Of course, obesity is something that you don't get immediate gratification. You have to sort of watch it over time. I'm not sure exactly how much we'll have. We'll certainly have pretty mature single-dose data, for instance. We'll understand target engagement. We'll understand knockdown. We'll probably have some insight into some weight loss. These are not huge studies. We won't have had a chance to watch them long enough, probably. We should be getting some insights, at least on target engagement, which I think is important in this area. Activin E is not the easiest target, Inhibin E. And ALK7, we're the first company that's ever gone into the clinic with an adipocyte delivery. This is our first adipocyte program. It's not only important because we think ALK7 is a great target, but it's important because it's a proof of concept. We've got a whole phalanx of targets that we're currently doing the preclinical work on, adipocyte targets. We think it's a fantastic organ to target. This is important to us. If we can show target engagement and knockdown of ALK7, that bodes very well for the delivery system. The nice thing about RNAi is once you've got a delivery mechanism, it's plug and play to put a different siRNA against a different target for that tissue. Unlike small molecules or monoclonal antibodies, where to know one is to know one, with siRNAs, once you can hit a tissue, you can just keep hitting it with different targets. You'll have a high likelihood of success. Right. For the end of this year, do you think you could potentially have ALK7 proof of concept data there for target engagement? I don't know. It's asking a lot. I'm not sure. I mean, we did just start, we just announced, I think, yesterday, the initiation of human dosing. So the first humans have been dosed. It's hard to predict that. I think the guidance has been maybe we'll have some at the end of this year. Certainly, first half of next year, we can expect ALK7. The data will come out sort of as we're able to. As I said, with siRNAs, it just takes some time. Yeah. Yeah, it makes sense. For INHBE, you mentioned that you started dosing with tirzepatide. Could you have some combo data by the end of this year? I don't know. It really depends on how quickly we're able to fill those cohorts and how much of the data we can actually get analyzed. The one thing I do want to caution is I think it's going to be a couple of decades here of just incredible innovation in the obesity space. The GLP-1s have been a fabulous innovation. There is a lot of white space around them. The weight loss quality has real problems. The tolerability issues at the doses that give you the best weight loss are a problem. There are lots of issues with these drugs. There are lots of opportunities to play alongside them. We're not trying to replace them. We're trying to fill some of the needs. We're trying to improve the quality of the weight loss, maybe allow a lower dose of the GLP-1 so they're not as toxic for the patients, for instance, and still get the weight loss you want. I'm personally most excited about the possibility of durability, that you get your weight loss with your GLP-1, and then you have a way to keep the patients from gaining the weight back because that's a huge problem. We do surgery on patients, take out huge parts of their gut. They lose a lot of weight. Then three years later, four years later, they've gained it all back. It's just depressing to deal with this issue. People go on crash diets, lose a lot of weight. Then two years later, they've gained the weight back and then some. There is a lot of white space. I'm just excited to be in this game. Will these two drugs turn out to be the big answer or a big answer? I just think there are going to be a ton of winners in this space. It's like the most important public health problem we have on a global basis. I mean, it's just an immense problem. I just don't think GLP-1s are the sole answer by any means. Don't compare these drugs head to head. They may surprise us. Maybe you'll find something that will totally disrupt the GLP-1 space. That's not what we're trying to do. We're just trying to fill the white space. Most of these chronic diseases need multiple therapies. Most of them need two or three drugs in combination to really get the job done. We'll see. Right. Yeah, the GLP-1s probably be viewed as like a sledgehammer type approach, kind of the first crack at this. They show that they work. There are definitely trade-offs with them. INHBE and ALK7 have biological validation, which shows that these could be better targets to go after. Lots of white space, lots of ways to help these patients in a durable, long-term way. For part of what you're measuring, I think you've mentioned that you're doing MRIs on patients. We've been looking at GLP-1s and some of the MRI data out there, which shows that you can lose the lean muscle mass over time. Maybe talk about just what you're going to show in the INHBE data update when it comes to weight loss, body composition, just any other biomarkers. Yeah. Nature's already done the experiment. Part of what we like about INHBE and ALK7 is nature does this. There are people walking around that are mostly heterozygous. They have one gene for ALK7 or INHBE one that's normal and one that's not normal. Those patients tend to be thinner. They tend to have less visceral fat, obviously normal muscle mass. They eat normal quantities of food, but they just don't gain the weight. They tend to have lower incidence of type 2 diabetes. They're just metabolically better off. That's kind of what we would hope that we can replicate in patients in the clinic. We would hope that we can have weight loss without the muscle loss, which is a big problem. We would hope that we could have sort of durability. Maybe patients can have a more normal diet and still be able to control their weight. Those are the kinds of things we're hoping to see. I'm not sure we'll learn all of that from our initial study here. Over time, I think that's what we're hoping we can demonstrate. Got it. We're pretty much out of time. I'll ask you a two-part question to close out. You've got the pulmonary platform, where you've shown good proof of concept there. You've talked about BD in the past. We've seen some siRNA BD deals recently, which are kind of interesting. What are your latest thoughts on BD? Maybe just close out with key events ahead that investors should be focused on. Yeah. One of the things as a 35-year drug developer that surprised me is that big pharma has been so slow to—I mean, they kept doing ASO deals long after I think they should have given up on that technology and moved to siRNA. I've just never understood why they did that. I think finally, people have woken up and realized that siRNA is a wonderful technology. I think we're going to see more BD deals going forward. That's going to remain a very important part of our strategy of our business. As I opened up and said, we produce way too many really wonderful drugs out of our preclinical group, which is easily the most productive in the industry. Most of those have to find homes outside of Arrowhead for going certainly into phase II and phase III. It's just too capital-intensive for a pre-commercial company, especially to exploit all those. So expect more BD from us in the future. I mean, we just did the huge Sarepta deal, of course, last fall. But I expect us to continue to see BD. Great. Thanks so much for joining us today, Bruce. Thank you. My pleasure.