All right, we're going to go ahead and get started. Here's our timer. Welcome, everyone, to the Morphic Fireside Chat here at the TD Cowen 44th Annual Health Care Conference. I am covering analyst Ritu Baral. I'm joined by my associate, Anvita Gupta on the other end. And with us from Morphic, we have CEO Praveen Tipirneni and CFO Marc Schegerin. Thank you guys for joining us. Yeah, thanks for having us here. So maybe we'll start with the Phase 2b EMERALD-2 trial. All eyes on this, right? That study's progressing. Maybe we'll start with expectations. So given your Phase 2a data, with the receptor occupancy and the various endpoints, Modified Mayo Remission, RHI, etc., how would you frame your expectations from that dataset using read-through from that top line and the 44-week data you presented at UEG? Maybe, maybe the way to start off answering that question, and then I can ask Marc as well to comment, is what do we need in an IBD drug today? What does the world need that doesn't exist today? And what we need today is an oral, safe, clinically meaningful therapeutic for IBD patients. And that, we believe, does not exist today in the world. With a trusted mechanism. Yeah, well, I mean, we have the added benefit. We have the added benefit of it, it being a validated mechanism as well. But I think it's a really important point is that in today's landscape of IBD therapies, remember, this is, these are patients that have jobs, they have kids, they travel, these are a very active bunch. It's, I mean, it's just interesting to note that an oral, safe, clinically meaningful drug today does not exist for these patients. And so that is what Morphic is trying to bring to the world. And we have the added benefit of, you know, we can debate how high a probability of success, but there's a well-validated mechanism, so we believe that the probability of success is quite high. So, as you think about expectations, maybe the primary endpoint for the Phase 2b. Talk to us about what's a fair expectation. What do you need for regulatory, and what do you need for that to build out the commercial profile that you just. That you just described? Yeah. I think I think the crux of that is what, what when we say oral, safe, clinically meaningful, what do we mean by clinically meaningful? And Marc, Marc, do you want to talk about that? Yeah. Yeah, absolutely. So I think you, you mentioned regulatory and then also the commercial aspects. What is important for the field? What do patients actually need? I think from the regulatory perspective, although I, I wouldn't want to speak for them, but I think it's pretty clear based on the drugs that are already approved that you need there's sort of, table stakes, i-if you will, for efficacy and the other and the other attributes of, 10% or so that you need to, break through as a delta relative to placebo to, gain regulatory. Modified Mayo Remission. Modified Mayo Remission at about three months. This is fairly typical for all the modern trials and is clearly kind of a bar for success. So I think that's, to some extent, table stakes to kind of achieve this overall profile that, to Praveen's point, doesn't exist today. It's a really important feature to have those attributes. And then, as you started to mention, there are some additional kind of bonus attributes that relate to the fact that it's a known mechanism. It's the only one in the whole field that's not immunosuppressive. Therefore, it's potentially combinable, etc. So there's a lot of additional bonus attributes aside from just what's required for approval. But even that, being safe oral and effective with a clinically meaningful effect is something that doesn't exist today, and it's already kind of knocking it out of the park. What about the secondary endpoints? What are the most important of those as you look at, again, regulatory, although mostly they focus on frontline, right? But secondary endpoints as far as the commercial profile and clinicians? Yeah, I think it's not exactly the secondary endpoints that I'm going to talk about, but I think how Marc framed it in your previous conversation is that, you know, the band of efficacy for IBD drugs is fairly narrow, but the band of safety is fairly wide. So I think the thing to watch for in this trial is how safe is the drug, right? Because that is actually although we put all our mind toward focusing on efficacy, the reason Entyvio, vedolizumab is so popular is not the efficacy. The efficacy is very good, but it's in the range of other compounds. It's really the safety, right? Because remember, this population is one where patients are actually asked, right? They're like, you know, if you go to a GI doctor, they say, "Hey, you know, these are the possibilities to try, at your stage of inflammatory bowel disease. You know, do you want a risk of a lymphoma? Do you want, you know, a cardiovascular risk, or do you want Entyvio?" Right? And of course, people always go toward Entyvio. And so, it's not exactly the question that you asked about, secondary endpoint, but I think the thing to really watch for here is the safety profile, which is really what drives so much of the Entyvio prescribing. Anything to add to that, Marc? No, absolutely. I mean, technically, that is a secondary endpoint, I think, one that is a little bit more overlooked. Certain groups, you know, it's certainly not overlooked by GI docs and patients or payers, but it's just a bit harder to quantify to quantitate what is the degree of safety. You know, it's not like one drug has a 52 and another drug has a 15 and another drug. So because of that, it gets overlooked a little bit, but it is tremendously important in the clinic. And I don't think it's hard for folks to, you know, whether you're an MD or not, kind of put yourself in the doctor's office and imagine that conversation between these, you know, otherwise healthy folks and their physician talking about things they understand. I mean, they know what cancer is, right? They know what lymphoma and melanoma are. They know what infestations and infections are. They know what immunosuppression is. They may not know what bradycardia is, but, you know, it can be explained. These are things that really provide a major barrier to uptake and, and use except for the last, last, line of patients. There's, you know, things like cancer, and there's things like stroke. There's also just general immunosuppression and systemic immunosuppression, which is kind of a characteristic of all of the other drugs, except Entyvio. That is a characteristic of all the other drugs, which is really important as you think about side effects like, like infections, but also as you think about combinations, since obviously combining two immunosuppressive agents may not be the best idea. You know, that's kind of frontier two. That's why we think about this aspect of the profile, though it's harder to quantify, is a critical, critical element, this sort of continued safe profile that we've seen so far and have a reference drug for. The other question I want to make sure we get to is the comment. I wasn't there, but at your IBD panel, the comment from your KOL. I want to make sure we get to that. Yeah, yeah. Let's hit two points, and I'll, I'll let Anvita, who was on the panel, drive it. Can you talk to us about the primary endpoint is collected if there's any sort of procedural differences we should be thinking about, and also how is enrollment going? Yeah. Well, similar to the 2A and similar to the way the trials have evolved, you know, we tried the 2A, that we announced, right, was the open label one, right? But when people were asking, you know, "Why did you do the open label? And how do you know you can, you know, trust the results? Or are we going to be able to read anything out of the results?" You know, we said at that time, "Look, we want the right answer too, right? We don't want to invest in a false positive result." And so we wanted to make it as rigorous as we possibly could. You know, at Morphic my experience in the IBD space, but, you know, our clinicians have been in the IBD space for, you know, decades. In this case, you know, the endoscopies, for example, they are all centrally read. They're all blinded. They're not even, you know, blinded in the sense that they don't know what study it's from, but they have dummy ones in there, in between and stuff like that. So, you know, we as far as we know, we've created as rigorous a possible trial as we can in today's state of the art. That's translated as well into, you know, our Phase 2b as well. Because, you know, again, these are expensive, long studies, and we want the right answer as much as, you know, the world at large. The second one was, oh, about do you want to have Marc talk about enrollment? Yeah, so enrollment's on track. It's been a great, you know, trial with respect to execution. This is the company's first Phase 2b trial. But we have a great sort of ClinOps team and great clinical development team. And so it's been a global effort. Sites all over the world, and enrollment's on track. And we've had this guidance of the first half of 2025 for the ultimate public readout for this trial for now, more than a year and a half or so with no tweaks to that. So again, it's been completely, Will you give us a enrollment milestone update? And how is the geographical spread of enrollment tracking with your expectations? Yeah, so maybe the second question first. I think the geographic split so far is typical in what you would expect and see in other trials. And, of course, we can't compare it to our Phase 2a trial because that was purely Poland and the United States. This is a more typical, sort of global trial. In terms of specific enrollment updates, I'm not sure if we've said or even decided internally what, what, what are the sort of milestones that we'll provide public guidance for. But again, that, sort of first half of next year is clearly in our sights. Got it. Anvita, you want to talk about some of those? Yeah. In terms of efficacy, so yesterday at the KOL panel, we asked, "What does Phase 2b need to show? Placebo adjusted to ensure or to think about the commercial prospects of MORF-057?" The doctors said 21%-25% would be great, but 15%-20%, you'd be in discussions. 10%, obviously, you'd, that's approvable. But 15%-20% is what they would hope for. And with that delta, they would possibly put 50% or more patients of the mild patients on this drug. How do you think about that range, those ranges, and your mild patient opportunity? Yeah, I think that's interesting. I mean, thanks for having that panel. It seems like a really productive panel. I mean, I think if off the cuff or shooting from the hip, physicians thought that they would put 50% or more of their patients, mild patients, on the drug. Of course, that's a massive opportunity and one that with respect to the label would need to be sort of approved and incorporated into the trial design as well. There's this huge market in the moderate and even severe space, but they call it moderate, early, moderate, late, mild sort of population, however you define it, that is massive as well. I mean, I can just tell you that, in our sort of external research that we've done with a big consulting firm where we have a big model with a lot of different variables, in our base case, which doesn't include a label for mild patients, we have 0% market share. And that's just a base case sort of internal commercial assumption. In the high case, 1% market share because there was some addition in the clinical trials that would allow for that. And that added like $1 billion, a couple billion and a half dollars of peak sales. So 50% is kind of a, you know, unthinkable, right? So, yeah, it's a great opportunity. I think it's one that reflexively and intuitively docs know, regardless of the exact percentage of this or that. It's really about the totality of the profile. And whether it's clearly that first-line market, however you define it, where something like this would slot in perfectly because there isn't anything that is safe, oral, and effective. Clearly, the current quote-unquote "first line," which is not 5-ASA and steroids. I'm talking about first-line advanced therapies, sort of dealer's choice, Humira and Entyvio. In this country, it's typically Entyvio, but in the rest of the world, call it dealer's choice. These are obviously both needles. And so that transition, that sort of admission that you failed and your disease is progressing between some sort of oral therapy, prednisone as oral, 5-ASA, into these needle-related therapies, it has some resistance to it. And it's sort of an admission of failure. Being able to transition to another oral is mentally a lot less cumbersome. There's a lot of patients who are in that couple-year window where they're sort of dragging their feet. This is a huge opportunity to expand the pie. Not that the pie needs to be expanded. It's a huge market as it is today. Do you have a number around that? The patients that you and I talk, they're not in control. They're just in denial. I in terms of patients or dollars? Patient numbers. I mean, we do. I mean, there's a lot of patients in that, more than—I mean, in UC, there's more than 100,000 patients that are in time in that group. So it's a big market. It's a growing market. It's a younger and younger market. And it's one that's, you know, increasingly active and sort of in need and engaged with the community and in need of these sort of new profile of drug. There's been a lot of—I'll call them me-toos—but there's been a lot of additional therapies which haven't provided anything that's truly unique and different. And that's what we kind of aim to do. Are they in that bucket because they or theirs, their disease is really on the edge, or are they really in that bucket because they're moving too fast in their life? Do you know what I mean? To slow down for a needle? Like, how have you done the work to sort of characterize why that choice is made? Yeah. I mean, I don't want to be overly specific because I could easily just be wrong. I mean, I think it's multifactorial. There's definitely a needle phobia component to it, but that persists over time. That's not just related to the initial transition. There's also, I think, this, you know, sort of access payer, you know, it's a big hurdle for the physician to get to, in more academic centers. I think it's a quicker transition out in the community. Maybe there's more folks in that kind of gray zone, call it late mild or early moderate, semi-refractory. They don't have a Modified Mayo of 9. That's going to be escalated, those folks. But these, like, people who are 3, 4, 5, and they come back down and they're, like, being half-controlled, who would clearly benefit from an advanced therapy but are just not willing to take that therapy. I mean, I think there's also a patient psychology that's not talked about as well as much in that I mean, you know, those of us who kind of grew up in the '80s, right, remember there were, like, afternoon, you know, after-school specials about kids and diabetes needles, right, and that they'd hide them in the bathrooms. And you know, people don't want to admit that they're sick. There's an embarrassment with it and things like that. So there's a psychology there of a pill is just much easier to psychologically handle than moving to a needle where you definitively we're used to taking pills where you have to definitively admit that, you know, you have a serious illness, right? And there's that psychology as well that has a part to play. So it really is multifactorial, you know, as Marc talked about. But it's a big, big problem. I have a follow-up on the efficacy part and going off-script. So apologies. In terms of efficacy, if we think about the shared mechanism, obviously, you want to be VEDO-like. But is it fair to compare or benchmark against Entyvio, given your primary endpoint is 12 weeks, Modified Mayo, and the populations are different from what the VEDO trials analyzed? How should we be thinking about that? Is that fair to compare it to Entyvio in that way? I think, Marc, you just answered that. So why don't you go ahead, and then I'll comment afterwards? Sure, sure. I'll take a step. I mean, I would say, you know, you should be always in science, should be careful comparing across trials. But in particular, in this particular indication, especially when you're looking at trials that were designed, actually designed 20 years ago now. So if you look at a New England Journal paper like, like Gemini or the Humira ULTRA trials published in 2011, 2012, they're actually designed in 2005, 2006. So this is very old trial designs, different endpoints, measured in different ways, even if they're called the same thing, with dramatically different patient populations, much harder to treat today. And so you're right. It's totally apples and oranges, and people should be very careful comparing, especially and, and people do it, and sometimes we're guilty of it ourselves, I admit. But especially comparing these efficacy endpoints to, like, even a decimal place of a percentage is often used. And again, we're guilty of that ourselves. I, I know that. But it's wildly false precision to talk about 11.5% or 10.9%, which, by the way, is Entyvio and mirikizumab, respectively. But that type of precision is, is not, you know, probably wise because it's, it's really false precision. So when you compare. Wise or even relevant. Or even relevant. And so I think what is interesting, though, is despite all the changes over the years, these deltas or these percent, some of these efficacy measures have managed to cancel each other out because the absolute numbers are quite similar. It's not like today it's 70% and before it was 10%. They're kind of in this similar band despite all the differences across trial. And so with respect to approval thresholds, obviously, Humira was 8% or so, and that was approved first right after Remicade. And so that's obviously lower than 10%. I think today, probably 10% is more of a bar. But it's right in that range. And so despite all the caveats with cross-trial comparisons, these percentages have been relatively stable over time. And so I think, you know. I mean, I think, again, I don't know if you guys. Go ahead. Okay. Yeah. I think I was just going to say that, you know, I think the going back to, I think the true north is, basically, as we talked about earlier, an oral, safe, clinically meaningful, which is largely approvable drug in the IBD landscape does not exist today, right? And then that if you do the market research, that's the drug that everybody wants. So and we, you know, we, we did it live at a conference, even asked patients, you know, and you always get back to that profile. Just a couple more, I don't know, housekeeping questions, but make sure we go through this. We'll get to your question before moving to Crohn's. Forgot to ask when I about enrollment. We talked about the geographic spread. Is the treatment naive and treatment experience spread coming in at what you expected? Exactly. I think it's coming in right in the range. Yeah. Okay. And then the QD dose. You talk about, what, what it aims to serve. You just answered that. Well, and it's another factor in the whole receptor occupancy and what we know and what we don't know. Yeah. That's an important point. Perfect. Absolutely. So it actually serves a couple purposes. One is to populate, hopefully, a dose response curve. Regulators always like that. We'd be interested to see sort of as you look at daily exposure versus Cmax versus C-trough, exactly how that correlates, if at all, to efficacy. We know that our top two doses are basically saturating in the vast majority of patients the vast majority of the day. So it's possible that those two will be very similar outcomes despite the fact that the second is double the dose, double the Cmax, double the AUC, etc. So that QD dose, which is a lower daily, you know, lower total dose, could help to populate a dose response curve, which would be helpful for a lot of reasons. It also helps us to understand QD itself because, of course, we're working on QD formulations in parallel. This puts, call it, a 10% bump based on our research and ultimate sort of uptake and sales. So helpful, but not, you know, it's not required. And so we're interested in having a QD formulation both for commercial reasons, also for combination reasons. It could be helpful. And so we're going to explore that more. And then the third thing I'd say is just the receptor occupancy trough number itself. How sensitive or correlated, well, we know it's somewhat sensitive and somewhat correlated, is receptor occupancy at trough to ultimate efficacy. We've seen from other programs that if you're, you know, C-trough receptor occupancy is around 30%, 40%, 50%, probably that doesn't correlate to sufficient efficacy. We've seen with AJM300, which is given three times a day. So the C trough happens, three times a day. We get down based on our calculations to around 80%. And you do see efficacy, in induction in any way, in any case. And with our QD dose, we would expect to get down to receptor occupancies in the 70s, call it percent. So in that in that range. Would a QD, a successful QD profile, support slightly less efficacy? Potentially. But at the end of the day, the slightly less, slightly more efficacy is a bit of a red herring because to, to Praveen's point, there's approvable efficacy and there's not approvable efficacy. That makes a big difference because if you're not approved, then you have peak sales of zero. It's very sad. So, so it's, it's more about I mean, you can do the same trial in the same patients with the same drug, two different trials, and you have slightly different efficacy. In fact, I guarantee you that you will have slightly different efficacy results. So I think what's required for both, whether it's BID or QD, it goes back to Praveen's point, which is this safe, oral, and effective, profile. Both are supporting BID and, and QD. That someday a QD will be important. I mean, I think the history of pharmaceuticals have seen that example over and over. Now, QD would be great. And hopefully, we will be the ones who put that QD in the market someday. But at today's, you know, state of the art, a BID is very acceptable. Was it a quick question? Yeah. So I want to ask about, like, the decision process when you're designing, like, a trial. Like, do you want to be a trigger? How do you decide on whether or not to include the control arm, and what's the upside or the downside? The question on the control arm in the decision-making process of trial design. So, why did we do the Phase 2a? Is that the question ultimately? Without a. Yeah. I mean, I think, you know, the way we've talked about it before, like, if you were in a, you know, a pharmaceutical company, like, if you're in a big pharma company, if I was in a big pharma company, I wouldn't have done the 2A, right? I mean, you know, I'd rather get the full answer. We have a broad portfolio of things. Lots of money. Lots of money, right? Like, I wouldn't have done 2A. But to roll the dice, for a huge trial, you know, you know, well-controlled, huge trial, not just in UC, but also Crohn's in this environment, you know, you want to maximize the indications again without any efficacy data whatsoever was, you know, it's a hard pill to swallow, right? And so I wanted some assurance that, you know, we were seeing, you know, some level of clinical efficacy that gave us some confidence that it's worthwhile in rolling, you know, the dice with a big investment. And so remember that we designed it in a very specific manner to show us that, right, that was we didn't use the I mean, you had the Modified Mayo there, but we used RHI, which is a continuous measure, right? So in a small population, we could show a statistically significant result and a clinically meaningful result. And that's what we did. Anything to add to that? Yeah. I mean, just so our UC trial, our phase 2b UC trial, was not predicated on success for phase 2a. We were doing them actually both in parallel as soon as possible, as soon as we had that safety coverage for the chronic tox. The phase 2b in Crohn's, however, kind of was. So it's a big expense. And we wanted to be 100% sure that we in fact did have a drug that clearly works and has that sort of continued safe profile that we saw in phase 1 and preclinically. And that did actually trigger and catalyze and enable the phase 2b trial in Crohn's. And we didn't want to wait until the phase UC trial was completely done before we started the phase 2b trial in Crohn's because that creates a big delta between approval dates, UC and Crohn's. And that's not ideal for a bunch of reasons, including IRA and a bunch of other stuff. So this was very short money, actually. It didn't take very long. It didn't cost very much to do the phase 2a. And it provided us with, I think, pretty unequivocal results that the drug is, in fact, working in this patient population. And so we were 100% after that. So moving back to the EMERALD-1 dataset, have you completed the 52-week biopsies and when could we see that publication? Guys, go ahead. Yeah. So I haven't, personally, but I think the plan is to kind of put the totality of the EMERALD-1 data into a big publication. I don't know if we've decided yet on whether that will include a bunch of preclinical work as well. That would kind of be cool because it would be a total one-stop shop for all things, MORF-057. I think that would be helpful for a lot of folks. It could also include, once we have it, the data from the exploratory cohort. Remember, those are just a handful of patients that actually responded to VEDO initially, but then were secondarily non-responsive. And that's an interesting cohort. And so to be able to kind of put that in one big compendium, I think could be valuable. So we'll try to get that out if we can. In our last few minutes, I do want to touch on Crohn's. How is that site, how many sites, site activation, how is that trial coming together? And is this another population where you have to watch geography and treatment naive versus treatment experience? Well, one thing I think it is important to talk about the Crohn's, and I'll ask Marc to fill in all the details. But I mean, in some ways, it's a bigger market than you think because it's a more undertreated population, right? So if there you know, when you talk to GIs, doctors say you have even an oral, like, forget about oral, safe, effective, right? If you have an oral there, they're like, that would just be phenomenal, right? You know, in that market, you bring something that just, again, where the state of the art is today. So I think Crohn's is a really important market for us, an important patient population, a very underserved population, especially with this kind of modality. That's why we felt it was really important to run the Crohn's trial, you know, as soon as we possibly can. No, that's, I mean, I do everything. Well, I think the question was, did you have and you want. The geographical, like, is a treatment experience and geographical distribution important to Crohn's? It's similar. There is a component of that, although it gets less, sort of, you know, scrutinized, but that is one of the stratifications. Okay. We have 30 seconds left. You recently disclosed preclinical targets for IL-23 and TL1A. How would these complement your and expand your, but complement the existing GI pipeline? Marc, Marc is dying to answer this question. Yes. Go for it. Every single day. Go ahead, Marc. Bit of an internal, you know, one of my, like, work streams I've taken upon myself. So, you know, both of these targets, and there are a couple other targets, as well that we haven't disclosed, but these are maybe the farthest along. We've been working on them for about a year. They're probably the most obvious scientific combination partners with an alpha-4 beta-7. And so, you know, they just kind of fit right in our sweet spot in terms of being able to combine something with alpha-4 beta-7, either the lead or one of the next-gen molecules. It's something that is hard to target with a small molecule, but not impossible. Integrins also are hard, but not impossible. This is another sweet spot for us because everything else that's ahead is obviously biologic. So if we can make progress there, it's going to have huge kind of strategic implications, I think, for us as we build out that matrix of combinations between alpha-4 beta-7 and these two, I think, fairly obvious combination partners for us. So it could be really important second frontier for the company and for the drug. Praveen mentioned we talk about, you know, safe, oral, and effective doesn't exist. You can knock it out of the park by introducing that into the market. But to really make a profound and fundamental change to what it means to be diagnosed with this disease today, we need to do something about the fairly, you know, call it unimpressive efficacy ceiling that we're seeing across the board that's been here for 20 years. Now, there was progress that was made with immunosuppressive agents. Not surprisingly, immunosuppressive agents are effective in an autoimmune disease, but that's plateaued a little bit. And so we think it's going to be through the combinations that we can smash through that. And to be able to do it in an oral fashion is sort of a no-brainer. Great. Well, thank you, guys. We are at time. Thank you for all the insight, Praveen. Thank you. Thank you.