Welcome back. Good afternoon, everyone. I'm Brian Skorney. I'm one of Baird's Senior Biotech Analysts. With me for the next Q&A is Enanta Pharmaceuticals. This is a company I've covered a very long time. Right, Jay? Yep. We've known each other for years and years, before even my Baird time. They have a number of programs. Historically, they've been doing a lot in liver virology, now they have an emerging I&I pipeline. We'll get to all of that, but maybe just to start, Jay, if you could just give us a little bit of an overview of what the company is focused on right now and what the core competencies you see the team having. Sure. Before I begin, I want to remind you I'll be making some forward-looking statements, and for a summary of the risks associated with these statements, please see our filings on sec.gov and on our website. In terms of Enanta, core competencies have always been in drug discovery and development, and discovering the drugs we develop ultimately. Our entire pipeline is filled with homegrown assets and wholly owned assets, except for, I would say, the hepatitis space. As you pointed out, we started out in virology and more particularly liver virology. Then we moved not out of that, but beyond that. We still have, obviously the hepatitis C stuff that have these cells as in the form of MAVYRET, which gives us good royalty revenue. We moved beyond liver virology and got into respiratory virology before the pandemic and chose RSV as one of the major unmet needs in pretty much all of virology in terms of its sort of universal attack on humankind starting from birth right away. We took that on as a problem. The pandemic broke out. We got involved in that. Increasingly, after liver virology and respiratory virology, we had a harder and harder time finding interesting things to really sink our teeth in and build the company on. We picked up on some of the adjacencies in the company from people who had trained. Many of our virologists actually trained in immunology and became virologists later. Given some of the skill set overlaps, it was sort of an easy migration into that area. We took that on. My background, I worked in immunology for a couple of decades, probably earlier in my career. Coming back and going down even JAK-STAT pathways were things I worked on several decades ago. Now that some of these things are more druggable and we will get into that, there is just lots of interesting opportunities. We view the I&I space as sort of an expanding universe of opportunities and again, building on our strength in virology. That is where we were and how we got here. Great. Maybe we will start and stick with virology before moving to I&I. Your lead asset in your pipeline is zelicapavir. We have seen a number of studies with zelicapavir across pediatrics patients, across higher- risk patients, across just seasonal patients. Now I think the LOTUS study is taking advantage of the RSV season there as a phase II-B study, hoping to inform maybe phase III design. I guess, walk us through the clinical history of zelicapavir, where we are at right now, what we are looking at in the LOTUS study to move forward and what sort of informed the design there. Yep. Zelicapavir is a replication inhibitor, and I will contrast that with entry inhibitors that many other people took on earlier in the RSV era. Pretty much all those replication or entry inhibitors have fallen to the wayside, whereas we concentrated on replication inhibitors in both of our programs. Zelicapavir was the first discovered as an N-protein inhibitor. As you pointed out, we have taken it into many clinical studies, first in the human challenge, well, phase I healthy stuff. Great PK, good safety. We have been in over 700 patients now with a very good safety record, so there is a good database there. We demonstrated really good activity, antiviral activity, and symptom effects in a human challenge study, and then moved into various real-world settings. The first study, one probably in retrospect probably wouldn't have run, was in otherwise healthy patients who contracted RSV. It turns out you cannot get to those patients fast enough. They self-resolve very quickly on their own. The teaching from that is you focus on the high-risk patient populations, and they are at opposite ends of the age spectrum. High-risk adults. Let me start with the younger. You are born with no natural immunity. You have to acquire it. Newborns onwards are incredibly vulnerable until they have had repeated RSV infections in childhood. Then you go through sort of the otherwise healthy period, and then you get into a period of immunosenescence as you get older. The immunity starts to wane. You have either end of the age spectrum and also people in the in-between that maybe they are otherwise healthy, but if you have any sort of a respiratory or cardiovascular complication, it can be very serious. COPD, congestive heart failure severe asthma. These things predispose you to poor outcomes with an RSV infection. We have focused on opposite ends of the high-risk adults, high-risk peds, and peds in general are high risk just because they have no immunity. To go to your question about LOTUS. LOTUS is a pediatric study. We are running it in Thailand right now, where the RSV season has already begun. The idea there is to look at about 150 children age four weeks to three years, so very young children in some instances, who have RSV and can come into the clinic within 72 hours of symptom onset. In that study, we are aiming to use our proprietary observer-reported outcome. These peds can't self-report, not in any cogent way, so we have to use an observer-reported outcome tool. We have been developing that literally for the last few years in connection with caregivers, physicians, and also groups that create these tools, and regulatory bodies in the U.S. and in Europe. Got a lot of input into building this tool, which we hope to be able to use as a tool for registration studies. You may recall in our first ped study, we got it in at the very end of that study. We didn't have the tool ready in time, but we do now, and it will be used as our primary endpoint in this study. Are you also looking at virologic response, and can you just refresh on what you saw on viral response for RSV peds? Is there any learnings from that study to apply here, just given the geographical clinical trial? I think the learnings is earlier is always better, and that's why we selected this three days from symptom onset. We saw about a little over a log. I think it's about 1.2 log reduction, which doesn't sound like much if you are thinking about Hepatitis C. But in a study, it's very similar to what people saw, for example, in COVID, about a log reduction. In fact, the only other study that we had to compare it to was one of those entry inhibitors in a study that was run in China. They saw about a 0.6 log, so we about doubled that. We will be looking at other, but you don't get approved on virology. It's supportive. We will be looking at other clinical measures as well. But the primary would be on symptoms. That's what we would aim to get approved on. Great. You are also designing a phase II-B/III study RESOLVE in high-risk, elderly, older patients. I would say elderly. Maybe sort of the same compare and contrast between the RSV high-risk study that you ran, what you saw there, and how you are planning to design this phase II-B/III. Yeah. In some ways, the common denominator is they are high-risk categories, right? Standard risk as I mentioned before, you really do not need treatment. But in the high-risk categories, we focused on some of the ones that were number one in the FDA guidance for RSV, but also ones that were deemed to be high- risk, for example, in COVID. Predisposing factors are age over 65. We ratcheted that down because we found that 75 and older is even higher risk. So we are picking 75 and older, or people with COPD, or people with congestive heart failure. That is the so-called HR3 population that we identified in our prior study, and where we saw a very meaningful reduction in time to resolution of symptoms. Again, symptom endpoints. We will be looking at other stuff. We also saw a very pronounced reduction in hospitalization rate in that patient population. We are very intrigued to look at that further. It was small numbers in our prior study, but we saw in the placebo group, we saw about a 5% attack rate for hospitalization. One of those placebo patients actually died in the hospital, so it is a severe -risk category, and we want to explore that endpoint as well, but it will be a key secondary. Got it. You had an end of phase II meeting, right, with the FDA before starting to plan the phase II-B/III. Yep. I guess, what sort of recommendations did they have in terms of the clinical trial design? On the clinical trial design, is there a jumping off point from a phase II-B to III? Is there an interim phase II-B data set, and what do you need to see there to justify going into the full phase III? Yeah. I'll answer your questions backward, with the freshest one in my memory first. There will be a break where we can see the data. I think what we want to see is sort of a recapitulation of some of the data that we saw before. Again, the time to complete resolution, the improvement in hospitalization rate. What that'll allow, actually coming back to the FDA meeting, going into that, we got a lot of questions from the sell side, the buy side, are you going to have to do two phase IIIs, or how's that all going to work? You never know the answer to that until you talk it through. Where we landed, we were able to do sort of a single registration study design with this phase II-B lead-in, confirm the endpoints, and then use that to make sure we've got the effect size calibration on the phase III component right, either scale it up slightly or down or whatever. Also look at that hospitalization rate. It gives us another crack to look at hospitalization. That could be a primary if we wanted it to be. At that point, we'd have the latitude to flip that into primary category. It just gives us some chances to observe all that. I think the other thing that came with the FDA discussion was the notion of looking at vaccinated patients. On the one hand, you don't want to fill your whole study, which is meant to just look at high-risk patient efficacy, you don't want to fill the whole study with vaccinated patients because that might, in some fashion, again, we don't know, we haven't looked at vaccinated patients, might blunt your results. Where we landed there was we'll study about 10% of the study will be in vaccinated, and we'll have analyses that will look at the non-vaccinated separately, so that we can really carve in on what it looks like in the unvaccinated highest -risk patient population. It'll be interesting because it's not that we don't want to treat vaccinated people. If vaccinated people come to the doctor with an RSV infection and they're symptomatic enough to be treated, they probably deserve to be treated. We want to study them too. Pretty sure I got TAMIFLU and the flu vaccine when I— Yeah. Yeah. There you go. —I guess when you think about these plans, how reliant are you for development of a bad RSV season? I know when you ran the original seasonal RSV study, there was a lot of delays. There was a period of time where there was no RSV, and then there was a lot of RSV. Yeah. How does that impact your development timelines? Yeah. Well, you do not want to say you always hope you have a good RSV season. But you do not want to have a bad one in a certain way, in as much as you are giving me flashbacks to the pandemic and to the post-pandemic era where I think what you are referring to was there was no RSV to be found in the world. We had over 100 sites set up in the northern hemisphere, southern hemisphere. We were looking everywhere for the virus. You could not find flu, you could not find RSV anywhere. It was all about COVID and masking and social distancing, and all that stuff worked. Yeah. The key was getting kids back to school. When back to school day came, that is when the virus broke out again. Daycares became little hotbeds, and they infected grandparents, and you were off to the races again. It took a while for seasonality to reestablish itself, but it has now, and that is why the last part of our prior study zipped up real fast once the virus came. Great. Maybe now pivoting to I&I. Maybe we could just start with talking globally how you pick targets, diseases. What is the process that goes on internally in Enanta to say, "Hey, we are looking at all these things out here, let us do a KIT inhibitor." Like what? Well, I will let Tara comment on some of this stuff, but generally, we try to find things. Anytime you can find clinical validation somewhere, you do not ignore it. Anytime you find big markets, you do not ignore them. Anytime you think you can get into an area where you can be competitive, you do not ignore that either. So you start circling around certain kinds of categories. But one of the things that we were intrigued with, there is so much good stuff that has happened in the I&I space, with monoclonal antibodies, and they hit some of the hard-to-attack targets. First got out there, demonstrated some blockbuster drug potential. Once all that settles, the markets get established, the mechanisms get validated, and then you start to zero in on where could we maybe offer some advantage, if only dosing convenience somehow, with a good potent small molecule drug. We look for those kinds of things. That leads us to KIT inhibition. You have a KIT inhibitor now in clinical development. Yep. How do you see your asset versus the landscape that is out there for other alternatives of KIT inhibition, whether it be biologic or other small molecule? Tara, you want to take that? Sure. We like the mechanism for KIT, in terms of looking at mast cell-driven diseases, because it really concerns the underlying mechanism. By blocking KIT, you're actually driving mast cells towards apoptosis, so there's just less cells available to drive that pathology. We also like it because, as you mentioned, there is an antibody to KIT, barzolvolimab, being developed by Celldex, which has shown best-in-disease efficacy in a phase II study. I think that's really good proof of concept. That's been in both CSU, chronic spontaneous urticaria, as well as CIndU. Those are both in phase III trials at the moment. They've also established POC in PN or prurigo nodularis. I think that's important for the mechanism. We also like the fact that there's really good biomarkers that de-risk the program early on in terms of target engagement. You can look at serum tryptase in healthy volunteers, and that has been correlated nicely with downstream clinical endpoints. Then, as Jay mentioned, there's a large market size here because you could really look at any disease that is driven by mast cell diseases. In terms of differentiation, obviously, I mentioned the antibody. We're going about this with a small molecule oral inhibitor, so it would be oral route of administration. For something that is longer-term dosing, I think that will be an important advantage and preferred by many patients and physicians. In terms of others that are out there that are oral, there was the Blueprint BLU-808 compound that is now being developed by Sanofi. They have had published some phase I data, and we're also running a phase I trial. That data we'll look to read out later this year in Q4. But we'll be looking to see what the safety tolerability is. Then also, as I mentioned, that serum tryptase data and the PK will be important to inform sort of next steps in terms of dosing. Got it. I guess from that description of the phase I data, what are you looking for in terms of PK, PD? On the PK side, I would imagine, is it one steady? Are you looking for a certain level of safe dosing? Then how does that translate to sort of tryptase reduction? What's the hurdle here, and what are sort of the mechanistic specific or other drug-specific AEs that you're trying to avoid, and what's the feasibility of getting around those? Our program is targeting QD dosing. In terms of serum tryptase reduction, we would like to see dose-dependent reductions of up to 80%. I think that has been shown to be connected to downstream clinical endpoints. Having that dose-dependent decrease allows us flexibility in future studies to think about different dosing strategies where you might be able to maintain the efficacy that Celldex has shown with antibodies, but perhaps mitigate some of these on-target effects that are known with the KIT inhibitors. Some of the things you think about there are, I guess, what I would call more aesthetic changes in terms of hair and skin color changes. Those tend to happen at least with Celldex's antibody a little bit later on, so probably not as likely to see those in our phase I. The MAD portion of our phase I is dosing up to 14 days. They also saw a slight decrease in neutrophils. We may see a little of that in the two weeks, but what they showed is that you see it decline until about a four-week time point where it plateaued around the lower limit of normal, and then was maintained out to, in that study, was a year of dosing. We will look for all of those things. If we are able to have a dosing strategy in patients where you might be able to, again, maintain that efficacy, but maybe have less of an impact on some of these other cell types like melanocytes, like blood cells, you might be able to have a better profile than the antibodies. I think that is something that we will have to understand in the clinic. Assuming good exposures, good PK, good PD, can you move right into patients? Would the next step be a phase II in CSU? Would that lead you to do even other studies of mast cell disease? I am thinking, can you do an inducible urticaria study? Sure. You can move right into patients. I think we are certainly thinking about urticaria as the next step for POC. It is very well established, quick and easy endpoints. Whether that is CSU or CIndU, I think remains to be determined, but either one would work. Then the next asset you're moving into the clinic, IND submission very soon? Announcing it now? No. STAT6. STAT6. Super hot target. A number of STAT6 degraders. People kind of talk about this target with orals as the oral dupi. How do you think about your development of an Enanta-specific STAT6 inhibitor versus the degraders, which seem to be taking a lot of the air time right now, and ultimately how do you see the STAT6 oral approach in sort of these I&I indications? Yeah. I remember working on JAK-STAT pathways in the mid-1990s, I think. I can certainly vouch for the fact that some of them were difficult to drug targets, especially on the STAT side, which is where degraders come in, right? So degraders like to climb on top of targets that are otherwise hard to drug by sort of classical methods and come in and just take the protein out. I think that's a great idea in certain environments, and especially if there's scaffolding functions involved and things like that, which there isn't for STAT6. A priori, our attitude is why would you use a degrader if you didn't have to on a target? Again, it makes sense if it's impossible to drug. But if we now know that they can be drugged, we and others have now created some very potent, very potent and highly selective inhibitors. Selectivity used to be a problem, it is not anymore. So we can get super selective, very highly potent, and molecules with good PK. Again, the notion used to be that small molecules, when you had good drug levels, inhibition would be up, and then when the levels waned, drug goes away, inhibition would go away, and then it comes back again when you dose again, and so on. But we are used to treating viral infections, where 24-hour time point, you want to have good drug levels with good levels of inhibition, and you want to do that every day. So that is the profile that we set in STAT6. So we have shown that we get complete inhibition, we get continuous inhibition, and that we have DUPIXENT-like efficacy in animal models of atopic dermatitis and asthma, and feel that is what you need to do. So the chemists and DMPK people at Enanta have been working very hard on this, looking at all kinds of interesting chemical matter. So we feel pretty good about the program overall and very confident in the approach. The next announced candidate is an MRGPRX2 antagonist. What led you down this target pathway? It is not as probably well-known in the Wall Street world as STAT6— Yeah. —and KIT. It will be someday. Okay. MRGPRX2, I think we were drawn to it, as we were with KIT, trying to find multiple different approaches for mast cell-driven disease, and KIT is sort of the big hammer, literally causing mast cells to apoptosis, and MRGPRX2 has a little bit more finesse associated with it. In some instances, you do not know which one you are going to need. Are you going to need the big hammer or the lighter touch? But it has also been implicated broadly in other sort of areas that were at least surprising to me when I first started getting into it, and that is in the area of migraine, where you have this crosstalk between sensory neurons and mast cells. And there is some really interesting data now that shows how MRGPRX2 blockade could be impactful in migraine. It is not the classical mast cell disease that you might be thinking of, but there is other interesting mechanistic possibilities there. So we dug into that target, have been exploring a lot of the biology, and have, once again, a broad swath of good chemical matter, and we are zeroing in on our development candidate very rapidly. Great. Now there is just a couple of minutes left. There is a lot of questions I did not ask. Pfizer litigation, MAVYRET royalties, cash runway. What important question did I not ask that you want to make up on potentially? Well, royalties are still flowing. That is on the one front. Litigation is still proceeding. For those of you who are not familiar with that is our ongoing litigation with Pfizer as it relates to PAXLOVID. We have a hearing in the European courts in a couple of weeks, so that will be the sort of a new installment with sort of decisions. They tend to rally around decisions very quickly in that court, so within several weeks thereafter, we should know something. Cash, we ended last quarter with a little over $200 million, have runway into 2029, and we should be able to get clearly to the other side of some RSV catalyst and some I&I clinical data sets. Okay. Well, great. Yeah. Always a pleasure to have you here. Thanks everyone in the audience. See you here next year. I will give you the. I will give you the 34 seconds back.