It is my pleasure to welcome Protagonist Therapeutics. With me today is Dinesh Patel, CEO of the company. We have a lot to go through. Indeed. There's a lot of excitement with the product launches and the pipeline that we're going to hopefully learn more later this year. Before we get to them, I'm going to turn it to you for opening remarks. Yeah, no. Well, first and foremost, thanks for inviting us. That is something we truly appreciate, and hopefully we will continue. I think Protagonist is at an unusually interesting and positive state right now. If you think about it, we are now a commercial company through our drug, Icotyde, partnered with J&J. We could be looking forward to potential approval of Rusfertide in the third quarter. That's when the PDUFA date is in August, and the phase III data has been outstanding, so that is partnered with Takeda. If that gets approved, I guess we'll be a biotech with two approved drugs this year. That's nice statistics. The other thing we like to point out is with the success of these two drugs, now we are for repeat performance. That's what our R&D pipeline is about. If you think about it, the probability of success in our case, I would like to believe, is significantly higher than whatever the norms are for our industry, for multiple reasons, right? Our biology targets are very validated, that's one level of de-risking. Our success with Ico and Rusfertide speaks volumes for validation of our platform, and our expertise in the field of peptides, right? That's very reassuring as well. It kind of adds up in a nice way, the de-risking. At last but not least, if you look at the statistics of peptides versus small molecules, peptides have a higher success rate through clinical development and through approval compared to small molecules. Things are lining up for us. At last but not least, financially also, there is a very big positive for the company. It's like we have ample cash and assumptions of cash coming in, through the royalty arrangements and milestone arrangements, both with J&J and Takeda. We believe that we won't have a need for a regular equity raise in the foreseeable future. If at anything, we would like to reward our shareholders with some share buyback kind of approaches down the road. Okay, got it. You mentioned, regarding the share buyback, I think you mentioned that back in March. What do you need to achieve for that to occur? Do you see this as a one-time event, or do you see this as a more or less a recurring event? Yeah. We are waiting for the approval of Rusfertide, because that will really cement our revenue projections. That's the key gating factor right now. We are not fond of one-time share buybacks. If we do it, we'll do it the right way, have a steady share buyback program. I see. Okay. Five years from now, how do you see Protagonist as a company? Will you ever consider building a full-size commercial team that can support specialty products? Also, what modality and therapeutic areas will you want to expand to or not expand to? I'm thinking about oncology, CV, and things like that. I remind myself, and others that look, with Rusfertide, we were already in phase III before we did the wonderful partnership with Takeda. Yeah, for rare diseases, niche markets, we are big believers of, therein lies the possibility of taking it all the way through commercial and maybe with the oral hepcidin and the second gen drug that we have, we may aspire to do something like that. Having said that, we have the financial strength to do all that. We are also very pharma friendly, and we are pro-partnership. We believe that partnership with pharma, it's not just about money. Much more than money is the expertise and the breadth of expertise and scale and all that they bring to the table. We'll be always eying for partnerships for bigger indications. For example, with the obesity one, I have no illusions of doing phase III studies on my own over there, let me put it that way. We take things to clinical POC on our own, and then for niche indications and niche products, we can develop it all the way through. Yeah. For others, we'll be partnering. Okay. More questions to come on those topics. Let's switch gears to Icotyde. J&J is saying that Icotyde could become one of its most successful drug in the history and potentially grow now greater than $10 billion at peak sales. Given that excitement and the launch progress so far, what is your own base case regarding the peak sales? I'm assuming that you've done your own market research because you're planning for the royalties from coming in. What have you found in your own research? Ico is a director, right? It's not only the first of its kind, it's the only one of its kind, the oral IL-23 receptor blocker that has been approved. The early indications regarding the launch are incredibly positive. Like yesterday, there was a fireside chat with J&J, the remarks are incredibly positive. If you think about it, the drug was approved on St. Patrick's Day, March 17th. During their first earnings call, which was April 14th, they claimed more than 1,000 prescribers. Yesterday, they shared it's more than 4,500 prescribers. Really, they are getting the market share both from experienced and naive populations and the switch from other orals and injectables to orals. These are early beginnings, the launch is incredibly powerful. If you look at our research analyst estimates that the projections are in the $10 billion-$15 billion sort of range of peak sales. I think the data that is really coming out, it's still early days, it appears very promising. I think that is very satisfying. J&J is doing an outstanding job, this is an outstanding drug with an amazing combination of efficacy, safety, and convenience. No other drug has all the three attributes. That works in our favor. Right now, the approval is just for psoriasis, and phase III studies in psoriatic arthritis, UC, and Crohn's are ongoing. Its value and market share can only increase over time. What is your expectation for peak sale? What I would like to say is my expectations or whatever number I may have in mind Right not that credible. Sure. It doesn't have value. I would rather have let the real numbers do the talking. Like I said, the research consensus estimates is anywhere from $10 billion-$15 billion. If you look at Skyrizi, it's going north of $20 billion, and TREMFYA is not that far behind. Over here, the important thing is here, there is an opportunity to take the market share from injectables and also create a new market, right? The J&J marketing research suggested that 75%+ of those that are on injectable in the I&I space, if a good option was available, then they would switch, and I believe IKO is a great option. Half of the I&I population that is eligible for targeted therapy are not choosing anything because they don't like the current choices, don't like injections, and don't like the choices that are available in the oral care, right? I think this could be huge beyond our normal expectations. Time will tell. Right. I remember when we talked about this back in February, I think you mentioned something that was interesting. You said that you see Icotyde, besides as the first line for new patient coming in and a great oral therapy, you see that it could be a switch or a maintenance switch, right, where patients on these injectable biologics. At some point At some point, and then you can switch as a maintenance. Yeah. Do you see that playing out? I know we were approved, and it was theoretical in terms of what that given that it's already in the marketplace and now, having conversation with J&J and what Icotyde is doing. Do you see that becoming more of a real scenario? Human psychology plays a big role, and I would like to believe that with an injectable, just at a psychological level, you're going to feel like a patient, you're being treated for a disease or something like that, right? For chronic indications, I'm like, "Yeah, why do you want to feel that way?" Oral will give you the feelings of as if you're taking your daily multivitamin or whatever, that kind of thing. The convenience of an oral is just unbeatable. You're right, people focus on where is the most efficacy. I'm like, "Okay, once the disease is under control, and now it has stabilized, and it's not going to flare up, that kind of thing, the maintenance setting becomes the most critical." Time-wise, the induction phase is three months, four months, that kind of thing. The maintenance is the rest of your life, and that is where oral will rule. Okay. I see. I think in order to hit some of those numbers, a lot had to go right because you're talking about the best drug potentially in J&J. The success rate with IL-23 blockers like Stelara, Skyrizi, TREMFYA, it's 100% for psoriasis, psoriatic arthritis, UC, and Crohn's. Sure. Yeah. There is reason for Right optimism for IKO. Right. In the next readout, the PSA, the psoriatic arthritis, that disease is becoming more of an IL-17 disease, I think. You look at what's going on because they're able to address the joints as well as the skin. What is your expectation from that phase III readout? Yeah In terms of addressing both skin and joints? Yeah. With Ico, J&J has done multiple phase III studies, right? The pivotal registration studies and then head-to-head comparison studies. With SOTYKTU, the TYK2 inhibitor. They have a wealth of data, and they have done a psoriatic arthritis subpopulation patient. In psoriasis within those psoriasis studies. Yeah. That has been presented before, and that data is very positive. If you look at the translation success rate, that's 100%. For IL-23 blockers from psoriasis to psoriatic arthritis. Right. We are feeling very optimistic about the outcome. Yeah obviously. Okay. From a commercial perspective, just kind of given that the IL-17s are becoming more of a trend, becoming more popular in the standard care for psoriatic arthritis, how do you see the commercial success in, say, how we compare that for psoriasis versus psoriatic arthritis. Yeah for an oral IL-23? I think if you look at the I&I pie and that kind of thing, it's fair to say that term conditions like psoriasis, psoriatic arthritis, out of it, psoriasis is a much bigger piece. Psoriatic arthritis is the smaller component, but it kind of is split between IL-23 and IL-17 blockers for now. Of course, IL-23s will dominate in IBD, and IL-17s will dominate in HS and spondyloarthritis, that kind of thing. Yeah. The nice thing with us is we are covering both grounds, right? Yeah. Yes. With PN-881, our oral IL-17, which is fully owned by us, we are in that space as well. Okay, speaking of that, obviously Icotyde is regarded as a huge success from the Protagonist platform. I cotyde was co-developed by you and J&J. What did you learn from that experience and specifically, from your platform and from what J&J's contribution was Yeah that you can apply to the IL-17 development? Yeah, I think it's an excellent question. The way to think about this is to get to a drug, you have to discover it, and you have to develop it, right? There is discovery, and there is development. When it comes to discovery, our expertise is in discovering peptides. This is a journey we have started since 2008. We know that very well. We'll be the first one to admit that when it comes to discovery, each time, it's a new beginning. Yeah. Right? Yep. The expertise, experience, and efforts that go in the discovery part of IL-17 are totally different from IL-23. Once you switch to development, and as early as pre-clinical development. Definitely in clinical development, that is where you benefit from the experience of Ico, right? For example, the skin inflammation pre-clinical model. It's the same model for IL-17 blocker evaluation that we had for IL-23. In clinical development, the inflection point for Ico was the comprehensive phase II FRONTIER study, right? There are learnings from that. We benefit from those kind of things. It's like we can apply those learnings to our own PN-881 at the right time. Right. For Icotyde, did J&J help part of the discovery as well? Did they help design the structure or look at different attributes or certain things that they have to meet? Was there anything that you can take away from that itself, and apply to IL-17, like the binding affinity and so forth? Like I said, the two targets are so different from each other that you just have to start from ground zero. Getting back to Ico, clearly it has been a joint collaborative effort since 2017 and still going very strong. We started the program in our shop all the way back in 2013. Yeah. If you look at-- Yeah, it has been a joint effort, like I said, with IL-17, it's totally a new ballgame at the discovery end. In development, there are learnings that you can benefit from. I see. Okay. Let's move to Rusfertide, because I do have more question on the IL-17 later. Yeah, we should move to rapid fire type questions. Yeah. The PDUFA's coming out in August. You guys already opted out of commercializing the drug. Yeah. What is your expectation? You guys done a lot of work in that space, then that led to the decision to opt out. What is the expectation for you in terms of the potential peak sale based on your own market research? Yeah. The drug belongs to Takeda, and they will be the main spokespeople for this, and they have provided a conservative estimate of $1 billion-$2 billion in peak sales. I'm not going to add anything further in terms of the guidance component. I think that's the right range to stare at this particular junction. What we are laser focused on is the PDUFA date, which is sometime in August. Let's see how things shake out. Hopefully, the drug gets approved, and things will be off to a good start. Fantastic. Okay. Have you done any health economic analysis during your opt-out due diligence decision, anything that you learned that you can share? Yeah. I think with regard to the opt-out, it was really a decision from a very different angle, so to speak. As you know, there was a $400 million opt-out fee. I was like, if I staying opted in, then I'm investing that money back into Rusfertide. Instead, I could have a better use of proceeds in our new R&D pipeline with that. Especially because of the fact that if we opt out, then we get three times higher milestones, close to $1 billion compared to $300 million+. More importantly, 14%-29% royalty worldwide. The 29% kicks it at anything over $1.5 billion. With that kind of cut on net revenues, you're not leaving that much on the table in comparison to a 50/50 profit loss split. Right. The economics are very fair to both companies, and that was the main driver. I see. Okay. How do you think it will be used initially, in the commercial setting? When you look across, because you guys study Rusfertide on top of the cytoreductive therapies, right? Right. You didn't reduce that. It's really mainly for reducing phlebotomy. In the beginning, maybe how do you think this drug will be adapted? Is it going to be more of the primary- Yeah inadequately controlled patients? How many phlebotomy? Is there a threshold that you have to get on? Just maybe think about from that potential payer scenario. Sure. What we found is in PV, is a very excessive erythrocytosis-driven disease, right? For NCCN and guidelines, you need to keep your hematocrit below 45%. In PV patients, you have it over 45%, that kind of thing. That's the basic definition of the disease. We were just shocked that there was no erythrocytosis specific agent ever. The classical treatment is phlebotomy. I think it's totally outdated. It's very suboptimal at best. I would like to make the case that phlebotomy is such a poor choice that was being made only because no good option was available. Right? First of all, with the blood draw, you are making patients very iron deficient. That leads to terrible symptoms. Even your iron and blood levels go through a rollercoaster ride. There is so much unknown. In the body of a patient you can envision worsening of the thrombotic- Right Thrombus giveaways and all kind of things. It's like, okay, people did what they had to do when nothing else was available. We intend to change that mindset and approach through Rusfertide. Erythrocytosis specific agent. In the clinical studies, if you look at the patient population that we were able to garner, it's very simple. It's like, hey, if you are not controlling your hematocrit and you continue to need excessive phlebotomies- There is an issue over here. You are dealing with a very ineffective therapy. That is what Rusfertide has been able to solve, right? I think the utility is going to be very broad. It hopefully will essentially eliminate- Right the need for a phlebotomy. This is the first drug where actually symptom improvements scored as an official secondary endpoint in the study. Right? That is huge as well. We believe that is because phlebotomy, you're taking iron out of the body. In our case, we are not taking iron out of the body. It just keeps recirculating. We are changing the distribution of the iron. Yeah in the body. Right. I see. When you think about it from a commercial setting, how the step edits are being implemented, would you expect step edit through hydroxyurea and maybe the interferons? Have you thought about, I know you guys are not involved with the pricing research and decision from that. Right Is there a price point where you feel like that would be the sweet spot where you can perhaps not have all these stringent step edits to it? Yeah. What would that scenario look like? There are a couple of questions in there, and one answer I would have is, hey, EHA is happening this week. We have four posters on Rusfertide. If one wants to learn more about Rusfertide, pay close attention to those four posters. I believe there is a poster on how did the drug perform in the phase III study, both in the low risk and the high risk population. That gives you an idea about the spectrum of utility or the effectiveness o f the drug throughout the whole spectrum of the patients and the treatment paradigm. In terms of what impact, if at any, it has on the cytoreductives or the doses and that kind of thing, I think we are sharing some of that as well, if I recall correctly. I would say yeah, pay close attention to the EHA posters to learn more about Rusfertide. In terms of pricing and all that is really up to Takeda. If you think about it, this is a rare disease indication. Yeah. If you look at Jakafi or the latest entrance. Yes, the Remi or yeah. Remi. Yeah, PV is a rare disease. I see. Okay. Let's switch gears to IL-17. I know we kind of touched a little bit on it a bit earlier. Going back to my previous question about Icotyde and what you learned from it, just looking at IL-17 itself, and you guys obviously have a molecule that you already advanced to clinical development. What is special about this? Because it's not just the oral component, because you can have an oral may not work that well. Is there anything unique about this besides being an oral peptide- Yeah that you believe that you're confident based from, "We saw that for Icotyde or something that you can-- Yeah. Look, like I said, in terms of the learnings from Ico, in discovery, you start from ground zero with each new target. It is in preclinical and clinical development that you can benefit from some of the learnings. Getting back to IL-17 as a target, first, if you look at the antibodies, they have already established the rules, and it's like the extent of inhibition of the target, that requirement is different for IL-23 blockers versus IL-17 blockers. That's one difference to keep in mind. The other thing I would add is like with IL-17, with the outstanding performance of bimekizumab, it's pretty clear that- Yeah You need activity against both A and F isotypes. We believe we are the only, or one of the few companies that have been able to kind of have that attribute in an oral peptide. That is the uniqueness about 881, right? We have both A and F spectrum of activity. Guided by the antibodies, we have a good understanding of what level of target inhibition is needed. In a way, in phase I study, the drug exposure levels will allow us to determine if we are fulfilling that criteria or not. Right. You mentioned bimekizumab. I will also throw in there, now looking up, do you run sort of like these side-by-side comparison, a lot of companies do that in the preclinical development, where they just kind of run competing assets out there and see how it performs against different metrics? Have you done that with bimekizumab or others? Yeah. Preclinically, there is only so much that you can do, and even if you do a lot, it carries very little value right at the end of the day. We have established the preclinical POC in the skin inflammation model. In an inequitable manner. Typically, it's like, hey, if an antibody is available, so the cross-reactivity component plays a role, right? Sometimes you don't have antibodies that will be cross-reacting, let's say, to the rat model or something like that, in which case then we cannot use. If a comparator is available, we would definitely be using it. I see. You have done those analysis. Yeah. We just haven't seen it yet. Yeah. Okay. Got it. Since I think you mentioned that when you guys have the data available or when the trial completed, the phase I trial completed, you will not share the data with the public, right? Yeah. Is that still the case, or are you- Look, we are not trying to be arrogant or stubborn. It's just that we felt that previously we were very disclosive of all of our preclinical data, and some of the well-wishers pointed out to us that we were teaching too much to the competition. We are like, "Okay, we have something that is valuable, so let's be a bit secretive and tight-lipped about it." That's how we are looking at it. Again, we are not being arrogant, but it's like, unlike most biotech companies. We were in the same shoe a few years ago, but not anymore. It's not as if on the heels of good data, we'll be urging to do an equity financing. In fact, if at all anything, we are saying we won't have a need for any kind of equity-based financing or money raised in the foreseeable future. Right. That necessity or need is not there as well. Having said that, what we are guiding towards is like, look, the phase I, we will see all the data in Q3, and that is the time when we will be ready to share our decision- Yeah of the next steps with PN-881. Right. If the decision's positive and you say we're going to advance to phase II, again, we're in the dark. We're not going to see what that data looks like. What can we assume? Should we assume that the data is comparable to Bimzelx or injectable biologics, or should we assume more like icotyde's profile where it may not be as potent as injectable biologic, but it's good enough? Yeah. How should we think about it? Yeah. There are three outcomes. A no-go, in which case it's like the data we got did not fulfill our requirements, or we could be doing a single high-dose proof of principle kind of study where it's like, hey, the data looks good, but let's confirm. We could be going for a full-blown comprehensive phase II study, like the FRONTIER study that was done with Ico. T he FRONTIER phase II study. In which case, you can make a qualitative assumption that. Yeah We really like the data that we saw, and we are just going for it. I see. The science, we also learn a lot by talking to the KOLs and all that, and there is a good understanding of the level of target inhibition that is necessary. Right. The drug levels will teach us a lot. Right. Okay. Basically pay attention to the phase II design. That will imply how- That's right. Right. Yeah. Okay. Got it. Then, I think you also mentioned that this is a hot target, and I agree with that. There's people knocking on your door asking, what is this asset? Would you start that partnership exploration before the beginning, before you kick off the phase II? Or how are you thinking about it? Yeah. There is so much value in engaging with companies early on. That is what we did with Rusfertide as well as with our oral IL-23 programs. Yeah, there is no scarcity of interest with IL-17 or other programs in our R&D pipeline. That's just a healthy dialogue. I see. Yep. At the same time, we are also saying we have all the money that we will ever- Right need to get to clinical POC. Right. So. You wouldn't wait, right? You would just Oh yeah, full speed ahead. Full speed ahead, okay. Time is the most crucial currency. Yeah. I see. Okay, let's spend the last couple minutes on the obesity program. What is your overall development vision in this, given sort of the complexity, the hyper-competitiveness, very fast evolving, price eroding nature of the market? I think we see now price down to $149 per month for some of these direct to consumer- That's right Cash pay programs. Why do you think this market is so attractive? Good stuff. Well, first of all, this is an opportunity of unprecedented scale in our sector, in its entire history. This is not a one drug fits all, or the first or second drug going away with all the winnings and that kind of thing. The market is still evolving, it is expanding. There is a lot more to do, and everybody is very busy. What we focused on is, as usual, differentiation. The first strike is with an oral triple and retatrutide, the phase III data is outstanding. That bodes well. We are the one with an oral GGG. We look forward to taking it forward in clinical studies. The clinical studies by themselves. Even the phase I studies will be very informative because you enroll patients with higher BMI. You start observing weight loss. Obesity is a big field, but also it's a very cost-conscious field. The cost of goods and all that is something that you factor in right from the beginning. It's almost like a non-scientific target product profile you have to have if you're going to develop drugs in the obesity space, right? We are very aware of that. If you think about it, our deep-rooted expertise in peptides and the way now everybody is interested in peptides, a lot of expertise is building COGS and cost of synthesis. Yeah. The economy of scale is combined all together. We are mindful of the cost, and we can manage it. Right. Yeah, speaking of the cost, these phase III programs are very expensive. You have to run one with- We'll definitely partner before phase III. Yeah diabetes, without diabetes, there's a lot of outcome study you can also do. Yeah. Is there a point in time that you would take this asset to and then just either stop there and look for a partner? Obviously you would be exploring partnership all the way, but if you don't have a partner, you would just kind of stop and shelf it. How are you thinking about this? Far, we have not had an issue in the history of the company of not having a potential partner. Hopefully we'll continue with that statistic. Keep in mind, it's not just about one GGG oral drug. We are creating an entire portfolio- Both around incretin and non-incretin kind of approaches as well. We believe we'll be a very attractive value proposition to multiple pharma companies that's at the proper stage with a whole basket, whole portfolio of very highly differentiated anti-obesity agents. Have you already started those conversations? Have you already started some of these partnerships? There has always been interest from multiple parties at any given time in all of our assets. I see. Okay. We are unfortunately out of time. It's been a very exciting time indeed for Protagonist, and it's been a pleasure hosting you, Dinesh. Yeah. I turn to you for final remarks. Super exciting for me as well. Thanks for inviting us. Look, I think we are a company that has a commercial presence. We are very validated. We have a rapidly expanding R&D pipeline that is very seriously de-risked in multiple ways. We have all the cash in the world to fund our programs and assets up to clinical POC. Pending Rusfertide approval by the end of the year, if that happens, then we certainly look forward to rewarding shareholders with some kind of a share buyback program mechanism. Fantastic. Thank you. Thank you again.