At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentations. As a reminder, this conference is being recorded, and replay will be made available on the Sagimet website following the conclusion of the event. Before we begin, I would like to remind our listeners that our comments today will include some forward-looking statements. These statements include statements regarding the presentation of the data from our clinical trials, our clinical development plans, and related and anticipated development milestones. These statements involve a number of risks and uncertainties, which are outlined in the press release for this event and on slide two of this presentation. Actual events or results may differ materially from those projected in the forward-looking statements, which contain known and unknown risks, uncertainties, and other factors that may cause actual results or performance to differ materially from those projected. I would now like to turn the call over to your host, Dave Happel. Please go ahead, Dave. Thank you, Tara. Good morning and afternoon, everyone. We are delighted to have you join us today to discuss our development program for TVB-3567, a novel FASN inhibitor in development for the treatment of moderate to severe acne, following strong phase three results for our FASN inhibitor, denifanstat, in the same indication from our partner, Ascletis. Next slide, please. For today's presentation, I will provide a brief overview of Sagimet, highlighting our denifanstat development programs. Rob D'Urso, our Senior Vice President of New Products, will discuss the significant market opportunity for a novel oral once-daily FASN inhibitor in moderate to severe acne. Dr. Bhatia, our esteemed key opinion leader, will then review the strong phase two and phase three clinical data with denifanstat in moderate to severe acne trials conducted by our partner, Ascletis, in China. Dr. Eduardo Martins, our Chief Medical Officer, will then highlight our planned next steps for TVB-3567 development program, followed by a Q&A session with our panel. We are delighted to have with us today Dr. Neil Bhatia, a board-certified dermatologist and Director of Clinical Dermatology at Therapeutics Clinical Research, a leading clinical research center in San Diego, California. He is also a past Vice President of the American Academy of Dermatology and Chief Medical Editor of Practical Dermatology. Next slide, please. Our pipeline is focused on FASN inhibition with our novel portfolio of FASN inhibitors to leverage the mechanism of action across diverse disease states. Our lead asset is denifanstat, a once-daily oral small molecule which offers a highly differentiated approach to treating MASH, acne, and certain solid tumors. Denifanstat works by inhibiting overactive fatty acid synthase, or FASN, which, if left unchecked, will lead to progressive disease in a number of underserved disease states, including our primary focus in MASH, but also in other diseases such as acne and certain solid tumors where we have generated positive clinical data. Denifanstat targets fat accumulation or lipogenesis, a root cause that is common to the disease states and conditions we are pursuing development. The focus of today's call is on acne, where there is a compelling mechanistic basis for inhibiting FASN, as Dr. Bhatia will walk you through momentarily. As noted, Ascletis, our partner in China, recently reported impressive statistically significant phase three results of denifanstat in moderate to severe acne patients, which followed their successful phase two trial. The phase three trial was conducted in 480 patients in China, and Ascletis reported that all primary and secondary endpoints were met. We have since initiated a phase one trial of our FASN inhibitor, TVB-3567, this month. FASN inhibition represents a novel oral mechanism in the treatment of moderate to severe acne. Now, I would like to turn the call over to Rob D’Urso, our SVP of New Products, who will take you through the acne market landscape. Next slide. Thanks, Dave. The global acne market is a large market. Forecasts it to reach roughly $17 billion globally in the next decade, with the U.S. projected to represent approximately 50% of the projected growth and revenues. Currently, within the United States, there are approximately 50 million people with acne, of which approximately 5.1 million annually seek professional treatment and are seen by dermatologists. Of the patients seeking treatment, 70% of them are reported to have moderate to severe acne, which is the target indication of our oral FASN inhibitor. Currently, available treatments show either limited efficacy, high potential for irritation, or risks of potential antibiotic resistance. Next slide, please. In mild disease, treatment consists primarily of topical products used alone or in fixed dose combinations with other agents. On the other side of the spectrum, patients with the most severe form of acne, cystic disease, are treated with oral isotretinoin. Isotretinoin is an effective option. However, the drug has prescription limitations due to the FDA-required iPLEDGE REMS program, which is one of the most restrictive programs in the industry for physicians, pharmacies, and patients. The majority of the patients, roughly 70%, experience moderate to severe disease. For this group, dermatologists will typically add oral treatments to the topical agents used for milder patients. However, these oral agents can carry undesirable side effects such as GI intolerability, photosensitivity, as well as complications that develop due to antibiotic resistance caused by overusage. In addition to these prescription medicines, dermatologists generally recommend a skincare routine to their patients to help manage the symptoms and address typical side effects of topical and oral agents, such as local dryness or irritation. These recommended skincare routines can effectively address dry skin concerns with the goal of enabling patients to remain on their prescription medicines for longer. I'll now invite Dr. Bhatia to share his thoughts on the therapeutic space, including the potential role of an oral FASN inhibitor in the treatment of moderate to severe acne. Next, please. Next slide, please. All righty. Thank you, Rob. I hope everyone can hear me okay. It's an honor to be here with everyone. Thank you, Sagimet team, for inviting me to come talk about the exciting new development with FASN inhibitors and bringing it to acne, which will be very exciting. As you can see on the slide, there are really four ways of dividing the key drivers of acne and the way acne pathogenesis is described. We talk about the elevated levels of sebum, the sebum production that's triggered by hormones, specifically androgens. The sebocytes, if you're not aware, are specialized cells within the sebaceous gland and lobule which produce sebum. They rely on de novo lipogenesis and FASN to produce roughly 80% of sebum precursors, such as palmitate and saponinic acid. Secondly, there's a blockage of the hair follicle caused by excess accumulation of dead skin cells on the surface, which we term hyperkeratinisation. The other component of that is the factors that make the environment, which is within the hair follicle where C. acnes, which is the bacterium present on the skin, experience accelerated growth and leads to local inflammation. This is where you see visibly the red inflamed lesions that, again, are universally recognized as acne. In addition, there's a genetic component to the disease. We often ask patients, you know, who in the family has had bad acne in the past. Of course, environmental factors, you know, that we often ask the patients about stress, about diet. Do they swim? Are they working in oily environments? Things like that that actually can contribute to acne as well. One of the things I like to point out, again, is, you know, the role of sebum here is not the same as oily skin. There is a very strong distinction between that. I just want to make that clear to everybody. In the two phase I studies, denifanstat effectively reduced skin sebum DNL lipids, and the FASN inhibition also has the ability and the potential to reduce skin inflammation. Due to the ability of FASN inhibition to reduce sebum production and address local inflammation, it actually offers a very attractive therapeutic profile. Now, let's go to the next slide, please. Since we talk about the clinical data to support the mechanism here, in the figure on the right, we see data from a phase I oncology trial which measured cutaneous sebum lipids via Sebutape. The FASN inhibitor demonstrated a more than 90% reduction in sebum lipids by day 15 of administration. Additionally, those low sebum levels were maintained for the entire duration of the trial. Just taking a look at the slides here, you see the numbers on the right side in that phase one oncology trial. Let's go to the next slide, please. Sagimet's partner, Ascletis, moved denifanstat into clinical trials in acne in 2023 with its phase two randomized blinded trial of 180 moderate to severe acne patients. The trial was designed to identify an optimal denifanstat dose to study in phase three, and three drug cohorts were tested of denifanstat 25 milligram, 50 milligram, and 75 milligram doses, which were administered once daily for 12 weeks. The primary endpoints of the trial evaluated the change in lesion count from baseline compared to placebo and the ratio of subjects who had a two-point or greater decrease on the IGA or Investigator Global Assessment Score. Let's review the findings on the next slide. As you see here, the announcement of the phase three trial, we'll talk about a little bit of these here. Again, just to reiterate, the 18- 40-year-old that were enrolled, they get IGA grade three or four, whereas the entry count, 30-75 inflammatory papules or pustules as part of the entry, as well as the non-inflammatory counts of 30-100. These are standard entry criteria for acne trials. As we look through the dosage, again, placebo dose, 25 milligrams, 50 milligrams, and 75 milligrams daily. Again, the randomization of the study with the primary endpoint, as I said. Okay. Want to make sure I'm on the same slide. Here we go. Sorry for my advance. Here's to the positive data from the phase two clinical trial data in acne from Ascletis. The results from the phase two dose ranging trial were announced in 2023. As you can see here, the highlighted column, the 50 milligram dose of denifanstat demonstrated meaningful and statistically significant improvements from placebo in reduction of lesion count and especially inflammatory lesion count. There was a strong numerical trend in the grade two improvement in IGA score. As you see here, it was providing a basis for Ascletis phase three pivotal trial of denifanstat 50 milligrams to move forward in acne, which we'll discuss next. Let's go to the next slide, please. All right. As you see here, this is the phase three clinical trial design. The study of the design of the phase three acne trial, which read out here, had a very similar baseline patient demographic as the phase two study. There were 480 moderate to severe patients with acne, randomized one to one to receive either denifanstat 50 milligrams once daily or the placebo drug, as you can see here. From there, let me go back. The primary endpoints were then measured at week 12 to include, again, the patient's definition of what they were as IGA success, meaning that, you know, again, number one, patients achieved that two-point reduction in their IGA score from baseline. Number two, more importantly, is that their IGA score was scored as zero or one, clear or almost clear at week 12, which is, again, important in maximizing the endpoints. This is consistent with other acne trials, as per the FDA. Again, the% reduction of total lesion counts and reduction in inflammatory counts from baseline at week 12 was also part of that endpoint. These two endpoints, significant in IGA score and reduction of lesion count, are aligned with what we talk about when we're looking at other FDA-approved trials for acne. We'll talk about that in a little bit. Let's go to the next slide. As we get into the discussion of the phase three clinical trial data here, we can see that clinical trial, you know, all the—I'm sorry, let's start again. We can see that the clinical trial data met all of the primary and secondary endpoints with a high statistical significance, as you see here. Patients' acne was judged by the trial investigators, and both inflammatory and non-inflammatory lesion counts were seen to have decreased. These robust results reported FASN inhibition as a viable pathway for treating moderate to severe acne. As all the endpoint outcomes were consistent with the phase two study, all were highly significant. This shows that this was a good result to see from the phase three trial. Let's go to the next slide. When it comes to safety, we'll discuss here. Denifanstat at a 50 mg dose was generally well tolerated in the phase three study. The incidence of treatment-emergent adverse events was similar to that found in those receiving placebo. There were only two categories of adverse events that occurred more frequently than 5%. These were, again, dry skin, which was reported in 6.3% of the denifanstat treated patients, and dry, which was reported in 5.9% of denifanstat patients. Additionally, Ascletis had affirmed Sagimet that there were no cases of hair thinning for patients taking denifanstat and only one case of hair thinning in a patient who was taking placebo. All denifanstat-related adverse events were rated mild or moderate, and there were no severe adverse events or deaths in the trial. In summary, the denifanstat was generally well tolerated, which positively differentiates this molecule in comparison to some other acne treatments that are commonly prescribed today. Let's go to the next slide. Now, on the next three slides, we'll compare the phase two and phase three efficacy data from the Ascletis clinical trials to the clinical data of other recently approved treatments. Again, it's important to notice that the slides show data from package inserts of sarecycline and clascoterone, as well as peer-reviewed publications that compare the placebo-adjusted response rates. It is important to recognize that these are not head-to-head comparisons and therefore must be viewed in the appropriate context. However, these data provide us a directional comparison of potential patient response to the various treatment options. As you can see, the Ascletis data are consistent and look quite competitive to these already approved products. You can see the placebo-adjusted differentials measured by IGA across the various studies. In the phase three trial, denifanstat demonstrated an 18.6% placebo-adjusted treatment differential. Now, looking at the other phase three programs for sarecycline and clascoterone, we see placebo-adjusted treatment differentials ranging from 7.3%-14.3%. Let's go to the next slide. As we see here, the data on this slide captures the placebo-adjusted differential reduction in inflammatory lesion count across the various studies. In the phase three trial, denifanstat demonstrated a 20.3% placebo-adjusted reduction in inflammatory lesion count, which was similar to the phase two results. Looking at the phase three data for sarecycline and clascoterone, we see a placebo-adjusted reduction in inflammatory lesion count ranging from 8.3%-17.5%. Let's go to the next slide. As we look at the non-inflammatory lesion count, we see similar patterns that emerge on this slide as well with regard to the placebo-adjusted differential reduction in comedone count across the various studies. In the phase three trial, denifanstat demonstrated a 23% placebo-adjusted reduction in the non-inflammatory lesion count. In the phase three data for sarecycline and clascoterone, these were more modest placebo-adjusted reductions in the non-inflammatory lesion count, which were achieved between 2.9%-13.8%. Let's go to the next slide. Thank you, Dr. Bhatia. In the next—let me turn it over to you. My pleasure. Thank you, Dr. Bhatia. In the next slides, I'll be sharing our clinical development plans for our second FASN inhibitor, TVB-3567. Following IND clearance in March of 2025, this month, we have initiated a first in human phase one trial for TVB-3567. TVB-3567 was identified as a lead FASN inhibitor by the Medicinal Chemistry Program at Sagimet, and a large body of DMPK, toxicology, and CMC work supports it as a clinical drug candidate. Like denifanstat, TVB-3567 is a potent and selective FASN inhibitor, while it has a different chemical scaffold. Sorry. This ongoing phase one trial is a double-blind randomized placebo-controlled trial to assess the safety, tolerability, PK, and PD of both single and multiple ascending doses of TVB-3567 in both healthy participants and participants with acne. For pharmacodynamics, PD, we will measure sebum reduction via the Sebometer and Sebutape, which will provide an indication of FASN inhibition in this early-stage study. We will conduct a single ascending dose portion followed by multiple ascending dose cohorts in healthy participants, followed by multiple ascending dose cohorts in participants with acne. Lastly, we will evaluate the food effect in a small 12-person sub-study within this trial. Upon completion of this phase one trial, we anticipate we will be able to select suitable doses to take into phase two clinical development. Next slide, please. As noted, we have already initiated the phase one study this month. We plan to evaluate the PK and PD data from this trial and assess the safety and tolerability of our second FASN inhibitor and identify the appropriate doses to take into phase two. Contingent on discussions with regulatory authorities and the outcome of the phase one study, we anticipate starting the phase two program in 2026. We currently anticipate that a phase two trial would be conducted in the U.S. in moderate to severe acne patients treated for 12 weeks and would utilize similar endpoints as in the Ascletis phase three clinical trial, including measuring reduction in inflammatory lesions, total lesions, and testing IGA treatment success. Next slide, please. To wrap up, we view TVB-3567 as a promising drug candidate for the treatment of acne and a significant potential value driver for Sagimet. We are very encouraged by the successful outcome of the denifanstat phase three trial in China, which met all primary and secondary endpoints and was generally well tolerated. As Rob presented at the start, there is a significant opportunity for novel therapies addressing the sizable and growing moderate to severe acne population. As Dr. Bhatia reviewed, a FASN inhibitor has demonstrated significant clinical efficacy for moderate to severe acne patients and represents a novel mechanism of action that suggests that FASN inhibition may be an excellent monotherapy as well as a complementary treatment with currently available treatments. The IP state for 3567 is strong, and our development path is clearly laid out. We look forward to working with the dermatology community and updating all of you when we complete our phase one study and begin the next stages of development. With that, I would like to thank Dr. Bhatia and all of you for joining the call. Operator will now open up to Q&A. Great. Thank you, Eduardo. At this time, we'll be conducting a question-and-answer session with our speakers. Please hold for a brief moment while we pull for questions. Our first question comes from Thomas Smith at Leerink. Please go ahead, Thomas. Hey, guys. Thanks for taking the questions and for putting this event together. Maybe just one question first for Dr. Bhatia. Appreciate you running through the Ascletis clinical data and the comparisons there. I was just wondering if there are any considerations you'd highlight in terms of translating these data that were generated in China to a North American patient population, either in terms of design and execution or in terms of population-specific differences in the disease state. Sure. As far as trial design and the execution of the trial, they were consistent with anything that would be done in a U.S.-based trial. These were all, again, apples to apples, if you will, from what the FDA mandates in terms of interpretation of the data. The entry criteria, the minimal lesion count, both the comedones, papules, pustules, et cetera, and the evaluation of the assessments were all consistent with anything we've seen so far in acne. I think, again, when we look at the Asian skin population, you can look at it one of two ways. Asian skin, obviously, you're dealing with fewer darker skin types, which, again, is not an advantage or disadvantage to the data. The second part of that is there is really no consistent increase in seborrhea or sense of oily skin in Asian skin that's comparative to, let's say, Hispanic skin or Black skin. The third component to that is, again, the assessment of the investigators would be consistent in training to those in a U.S. trial also. From that standpoint, I don't see any differences that are really palpable in any of that data. The other part of the equation, again, is that when you're dealing with patient populations that are being assessed because of their demographics, you have to basically look at the pathogenesis of acne and how that's going to respond independent of skin type. One thing that goes along with the inhibition of sebum is it's basically agnostic to gender or to ethnicity. Got it. That's super helpful. If I could just ask a follow-up here to Dr. Bhatia, assuming the phase three China data here are replicated in a North American program, could you just comment on how you would expect to use a FASN inhibitor in clinical practice and maybe just help quantify the percentage of your moderate to severe acne patients that you think this would be an ideal treatment for? Yeah. I like to put things in terms of therapeutic building blocks. I live close to Legoland, so I say, "Let's match the Lego blocks of the disease and match that to the Lego blocks of the therapy," if you will. My analogy for that is it's always better to turn off the faucet than to mop up the mess. If you can turn off the faucet of sebum, which is basically the fuel for how acne starts in conjunction with the formation of the microcomedone, the epidermal change that makes keratinization and the inflammation, you can shut off one of the major components that makes acne in the first place. Current acne treatments that are topical, we tend to be thinking about daily treatment because we're changing a defect from the top down. When we think about antibiotics, obviously, there's a significant antibiotic phobia in the world. There's also, again, the mechanism that is countering inflammation. Isotretinoin is a very complete therapy, but it also, again, comes with a lot of baggage, a lot of issues with, again, not only side effects that are minimized, but, I'm sorry, that could potentially be nuisance, but there can be some long-term things that we worry about. With looking at the mechanism of FASN inhibition, of how it impacts lipogenesis as well as its impact on the process that makes acne, I could see this to be a very effective product that we could position early on in treating the moderate to severe patients almost to the point of getting them on it as soon as possible. Got it. That makes a lot of sense. If I could just squeeze in one quick follow-up here for the Sagimet team, just in terms of how you're thinking about a potential registrational program for 3567, assuming positive phase I data, could you just give us a sense of how large you think that program would need to be and, I guess, how quickly you could move into registrational studies and maybe a rough sense of costs for that sort of program? Thanks so much. Yeah, Tom, I'll tell you what. I'll turn that over to Eduardo and he can talk a little bit about the clinical and regulatory path forward. Certainly, Rob and Terry can chime in on numbers and cost. Eduardo. Tom, the program, of course, depends upon discussion with the FDA and other regulators as with any clinical development program. I think Ascletis set up a very good footprint that would be something that will help guide what we're doing in the U.S. As for timelines and size, again, timelines will be as expeditiously as possible. We are working every day to make sure that things are on target and actually ahead of target. That's how we've always done that. As for size of the program, this depends on our discussions with the FDA and existing guidance. Then, Tom, of course, that would drive costs. If we run a blueprint that's similar to what Ascletis laid out in their phase two study of roughly 180 patients, you could assume something, I would think, in that size category for phase two proof of concept. Moving into phase three, really, it depends on the discussions with the FDA on the size of the trials. Ascletis certainly demonstrated in less than 500 patients a very highly statistically significant result across the board for both primaries and secondaries. Certainly, we'll factor that into how we size and power our studies as well. Next question. Great. Thanks for the questions, Thomas. Our next question comes from Nicole Martucci at TD Cowen. Please go ahead, Nicole. Hi, everyone. This is Nicole on for Rutubirol. Just a quick question to the Sagimet team. Can you guys maybe go into some of the key differences between 3567 and Denny and why you think this newer asset would perform better than Denny or the decision behind that? Thank you. Yeah. Thanks, Nicole. I'll turn it over to Eduardo here momentarily. I wouldn't say that we necessarily expect 3567 to perform better than Denny. I think if it performed equally, we would be thrilled with that outcome. That's kind of the path that we're anticipating. While the molecules have different chemical scaffolds, they're both very potent FASN inhibitors. Therefore, we actually anticipate as we get through this PK study with 3567 that the PK profile, we'll find a dose that matches up very closely with Denifanstat. From that point on, we can move forward and conduct our trials. The molecules from a DMPK perspective, from a tox perspective, perform very similarly. They are truly different chemical structures. Therefore, they possess importantly different IP estates as well. Eduardo, I'll defer to you on further. I think you covered it all, Dave. Nicole, just to reemphasize, both are potent inhibitors of FASN. We do not anticipate different mechanism of action profiles. They are both highly targeted. Everything else is, as Dave said, and we are developing it as one would develop any new molecule. No surprises expected. Development, of course, has to follow the steps that are well established, have been well established over the decades. Great. Thank you so much. Thanks for the question, Nicole. Our next question comes from Liam Hiester at Piper Sandler. Please go ahead, Liam. Hi, team. Great presentation today. I'm on for Yasmeen Rahimi at Piper Sandler. Our first question is just kind of if you could remind us of the commercial agreement you have with Ascletis, how soon you could potentially receive revenue from that, and kind of what is the timeline from that perspective. Also, given the recent phase three readout, has this driven any potential further partnership interest in denifanstat and MASH, whether it's from the additional safety data or some other aspects that strategics may find interesting? Thank you. Yeah. Thanks, Liam. I'll let Terry potentially answer part of this as well. I think to answer your first question, the agreement that we have with Ascletis is a very typical partnership that you often see with most pharma companies. We do have a milestone payment that is due at the time of approval of the first indication. In this case, almost certainly will be denifanstat and acne. It flips over into a series of milestone payments based on sales performance and thresholds. I think those have been disclosed, which I think most of the analysts have picked up to date. With regard to your second question, could you please remind me? Oh, yeah. With the recent phase three acne data, just from the MASH side of things with denifanstat, any additional interest from there? Yeah. Yes, I mean, I would say definitively we have interest in the acne program as a result of the readout from Ascletis. I think once we get through the phase one study, the PK study with TVB-3567, then we will appropriately explore those. We want to be able to ensure that we have a molecule that works and functions well in humans. We anticipate that it will, obviously, but we need to see this through. We should have a pretty good understanding of that, frankly, by the end of this year, certainly the beginning of next. We will entertain those discussions as we move forward. With regard to how it filters through on the readout to MASH, I think it has been very positive, I think clearly. It is largely because the AE profile that Ascletis reported out demonstrated that the molecule continues to be generally safe and well tolerated. I think particularly with regard to a couple of AEs or at least one prominent AE that showed up in the phase 2b study that has not showed up in any of the other three studies in which denifanstat has been evaluated. That is in hair thinning. As Dr. Bhatia noted that Ascletis informed us that there were zero cases of hair thinning in this phase three study, which is actually quite consistent with the phase two MASH study in which we saw one case out of 56- 50 milligrams of Denny. In the phase two acne study, there was one case of hair thinning out of 44. Essentially, we've seen two cases out of 340 in the non-phase two B study. We obviously take all of our data sets seriously, but it's important that in this number of patients the drug continues to perform very well, not only from a treatment response, but also from an AE profile. Based on that, we continue to see very little limitation to the patient populations that we're pursuing development. Thanks so much. Thanks for the questions, Liam. For Ellie, I have a question about just the feasibility of your latest interest in MASH. Could you be a little more specific on the type of information you're looking for on both the acne program and MASH? Right. I'm curious about your kind of commercial feasibility of just developing for acne alone. I just want to hear your latest thinking about development for MASH. Okay. Rob, maybe I'll turn it over to you and talk a little bit about the commercial potential and how you see this moving forward. I'll talk about MASH. Sure. Thanks for the question, Joseph. In the acne market, I think how we're looking at it is that the target indication will be for moderate to severe patients. That's a large portion of the patients that are seeking acne therapy in the U.S. Looking at those patients, I think Dr. Bhatia did a nice summary of where this product will fit in is that it addresses one of the major pathogenesis of the condition. It does have applicability in all 70% of those patients that are coming in with moderate to severe acne. I think that's our target audience and that's our target indication. In the U.S., there's about 12,000 dermatologists. The commercial footprint and investment is a modest investment that many companies find that they can launch products. They can launch companies and commercial efforts with one company or with one product. Yeah. Joseph, I think with regard to MASH development, we remain absolutely committed to developing denifanstat in MASH as we've reported out in our last earnings and in a call that we had with Dr. Lumba a few weeks ago to lay out our path forward. We fully intend to develop this molecule in MASH patients. The data that we have been able to accumulate to date, particularly in the more severe patients who are living with MASH, those patients with F3s, staged disease have benefited enormously. We've seen highly statistically significant two-stage improvements in those patients as well as one-stage improvement. We've seen highly statistically significant lack of progression in movement to cirrhotic state for MASH. As we've reported out the last two major conferences, we've been able to see and demonstrate data digitally that shows that this drug works very, very effectively in those patients who are most advanced, particularly at ESOL, where we showed patients that were digitally diagnosed as F4 patients on Denny. We are obviously quite committed to ensuring that this molecule moves forward in MASH. We are taking the appropriate steps to make that happen. Thank you so much. Thanks for the questions, Joseph. Our next question comes from Cheng Li at Oppenheimer. Please go ahead, Chang. Hi. Thanks for taking the question. This is Chang Liang for JOSN at Oppenheimer. We have a few questions. First, can you maybe talk a bit about the dry eye and dry skin events you saw in this phase three study, whether those events require some dose interruption or those events resolved spontaneously and have a few follow-ups? Thanks. Yeah. Eduardo, do you want to go ahead and tackle that? Sure. Dry eye and dry skin have been observed in other trials in a small proportion of patients. It was observed in the acne trial in a very small proportion of patients. It's important for us to remember that there were no adverse events equal to or greater than 10%. Dry skin and eye were in a range of 5%. Simple eye drops, as we have always recommended before to patients in a double-blinded study. As we saw in some of the other studies we had, many were actually on placebo. Moisturizing eye drops, moisturizers for the skin. To the data that we have in hand so far, I do not believe, if memory does not fail me, that there have been any discontinuations due to those events. I would not expect that anyway. Got it. That is helpful. Second question, I am wondering if you can provide some color on the median time to achieve IGA response. Maybe related to that, what's your expectation on the treatment duration in the real-world setting, whether you think a patient will only use Denny or the next generation program when they have flares, or you think the patient may use more chronically? Yeah. Dr. Bhatia. Yeah. I mean, that's a common question when we think of anything systemic that we're bringing to the market. I honestly would anticipate still using topicals with denifanstat, at least for a short time, to make sure that the adjustment and the change in keratinization doesn't lead to what social media calls a purge, for example. We like to explain to patients that acne will often get worse before it gets better in the first week or so. That's a very realistic application of using systemics and topicals. I look at this as thinking I could probably do away with most antibiotics, especially if you look at the comparison in the meta-analysis of sarecycline. The mechanism of inhibiting sebum is a much more efficient mechanism than the anti-inflammatory activity that's solo with antibiotics. I would look at this also as probably something I could keep patients off of isotretinoin if I can maintain them correctly with this for the long run. I look at the 12-week data as something that, honestly, in the realistic world of practice, I do not see patients back until three months because I use the 12-week data as a benchmark for them to say that in the research trials, most patients were seeing the best benefits at three months. It is kind of the description of acne as a marathon than a sprint. It also helps dermatologists to put into place the real way of not only making acne go away, but we actually want it to stay away. Not like we're treating a rash. I think some of that perspective is based on time. I think the way this data positions itself, I could easily see this being eventually a monotherapy from maybe starting out as a combination and weaning down on topicals if we do not need them anymore. Got it. That is super helpful. Just lastly, I am curious, again, to Dr. Bhatia. I am wondering if your thoughts on leveraging this mechanism in additional dermatology indication beyond acne. I think there is maybe some commonality between acne and maybe HS. Your thoughts on maybe. Yeah. I mean, that is going out a little bit of a limb. If you look at, and I'll just go back to one other point. If you look at the other drugs that were mentioned, treatment of the non-inflammatory lesions, the comedones, is an inherent part of why sebum as a target or lipogenesis will reduce their production. You don't see really good non-inflammatory lesion reduction only in antibiotics because it doesn't have that direct pathway. That's just a follow-up on that. If you take that a step further and you look at hidradenitis suppurativa under the hood, or you look at some of the other conditions that are primarily neutrophilic, for example, or perhaps have a very similar pathway, there may be some activity that you can make the case that probably could have a line extension. The natural two that follow are rosacea and seborrheic dermatitis, for example. They have some very similar pathways that go down, again, the path of sebum and lipogenesis reduction. Hidradenitis suppurativa, I could see, again, I would probably want to see maybe some proof of concept before I went down that path. I definitely think the mechanism is there, even though sebum reduction or such is not as inherent as some of the other basics that make hidradenitis suppurativa as a disease. I think it would definitely be worth investigating. I think, again, when we see opportunities that come from these systemic therapies that are proven safe, in our eyes, the sky is really the limit. It is really inherent on us to do the work and put the proof of concept into motion. Got it. Thanks so much. Thanks for the questions, Chang. Our next question comes from Andrea Newkirk at Goldman Sachs. Please go ahead, Andrea. Good afternoon. Thanks so much for taking the question. Maybe one for the team here, Dave. Just given the work that Ascletis has done and the compelling phase three data, is there anything that can be done to leverage that dataset or the interactions with the regulatory agency to maybe fast-track development of Denny for acne here in the U.S.? Sorry about that. Hi, Andrea. Thanks for the question. I think we have to have those discussions with the regulatory agencies before we could fully answer how we could possibly move forward with Denny. Right now, we're committed to taking our next-gen molecule 3567 forward. We have a pretty clear pathway to be able to do that. We're within months of being able to demonstrate in all likelihood that the PK profile of 3567 matches up very favorably to Denny. Therefore, being able to move that program forward into phase two and then subsequently into phase three remains the ideal path for us. Is there a scenario where Denny could move forward into phase three? Potentially, but we need to have those discussions with the FDA to understand what requirements they would need to see in order for us to do that. Eduardo, maybe defer to you as well for your thoughts. I think it's very much it. The Chinese data, of course, help us with the development in acne. As I mentioned before, both drugs, 3567 and Denny, are potent inhibitors of FASN. Although at this stage, I cannot say one equals the other, but working with two molecules in the same class, I think we can learn a lot. As Dave said, we cannot speak on behalf of the agency, but I believe we will go in with a robust package. Great. Thank you for the questions, Andrea. Our next question comes from Jon Wolleben at JMP Securities. Please go ahead, John. Hey, thanks for hosting the day today and taking the question. You talk about kind of the opportunity in terms of patient number, but wondering if you could talk a little bit about what we've seen historically from sales of other acne products or if you have kind of units sold. Is the expectation for chronic dosing for treating acne, or is there kind of a waxing and waning or a certain point at which treatment stops? Thanks, John, for the question. I think we'll let Rob talk a little bit about the market potential and some of the peak sales that we've seen with isotretinoin before it sort of was withdrawn from the market and some of the other medications. Dr. Bhatia, maybe you can talk a little bit about the chronic nature of treating the disease, which I think you started to touch on, but maybe you could elucidate a bit further. Rob, you want to talk about? Yeah. Thanks for the question, Jon. Just looking at two historic products as a reference, one would be Accutane, which was the original brand name of isotretinoin. The product was approved in 1982 and had significant uptick before it lost its patent exclusivity and was significantly impacted by the restrictions on the REMS. It was in the billion-dollar range in gross sales in the U.S. Just as a reference point. That was being used in a little bit of a broader audience. Once generic hit and also the FDA implemented the iPLEDGE REMS program, the usage of isotretinoin really shrunk only to the cystic acne patient, the very, very most severe patient. If you do look up isotretinoin usage now, you'll see that it's much smaller, but that's being driven by the implementation of the REMS program. The other product you could look at as a reference is Solodyn. This was an extended-release minocycline that was launched in the U.S. The market was highly generic, and that product reached about $700-$800 million. Again, that is a product that had only one piece of innovation, which is that it had an extended release. There was no additional mechanism of action or any additional new molecule. That demonstrated that just with a little bit of innovation, they were able to garner a pretty good market share at a premium price. Dr. Bhatia, I'll turn it over to you to answer this question. Yeah. I mean, historically, that's been the way that the oral market has definitely changed over time. I mean, isotretinoin is still a big part of us. In fact, probably picked up a little bit of volume after the pandemic because of concerns of antibiotics being used for acne, which, again, a lot of this was just patient preference-driven, market-driven, and some social media influence. I do think, again, we have to come back to the fundamentals of what acne is made by to look at what are the best targets for treatment. I will say denifanstat brings in this novel mechanism that we have not had before in terms of, again, I go back to turning off the faucet of how the acne is made. Our typical regimen has always included retinoids to, again, treat the surface area, to change the architecture of the skin. We use benzoyl peroxide as a very strong antimicrobial effect, detergent effect, if you will, but also to mitigate some antibiotic resistance when patients are on antibiotics. Again, clascoterone cream has done its job as an androgen receptor inhibitor coming to the market. Again, most of these have small uptake. I'm going to leave the access discussion back to Rob as well as what has happened to acne access because of the PBMs and everything else that goes along with our ability to get drugs in the patient's hands. I would actually make the comment that I think social media and the role of the influencers has actually helped prescription writing because of the frustration that a lot of patients have seen from misinformation as well as mismanagement of control of the acne narrative on the internet, if you will. I think we have a good opportunity to introduce not only some new mechanisms of action, but also some safe ones that patients really have had phobias against, whether it be isotretinoin or antibiotics. This is a really good time to kind of recharge the acne market for dermatologists. We're looking forward to seeing where that can go. Yeah. Maybe just adding on to that, Jon, for a minute is the fact that I think we view this and many view it as sort of the atopic derm or the psoriasis markets before new novel mechanisms were able to go into those diseases as well. Topicals were used frequently in the treatment of atopic derm with some success, much like in acne, but not in complete success, certainly not to the level that they may be able to achieve on a FASN inhibitor. It was not really until the biologics came along in both atopic derm and psoriasis that we saw those markets really take hold and really grow exponentially as they have. Given the fact that there really hasn't been a significant novel mechanism of action for several decades, particularly an oral novel mechanism in the last 40 years, we are very optimistic that a treatment that we are developing for the bulk of the patients that need it the most and would benefit the most is at the doorstep. Yeah. If I could just add, Dave, I mean, when you think about the market dynamics, we are not just dealing with teenagers and having to convince parents on the safety of drugs. The amount of young females in their 20s, the amount of women in their 30s and 40s, as well as menopause, the amount of men who are developing truncal acne in their 30s, this population is all on the rise. We cannot minimize how important it is to get these patients under control to reduce scarring, to reduce risk of secondary infection. When patients look in the mirror and they only see acne, and they do not see their eyes, for example, these have very significant psychosocial detriments to their development as teenagers as well as adults who really just do not see that they have hope. To have something new that is novel, that is not facing the stigma of safety that, again, the social media crowd has put on, I think we have a lot of chance to really change the flow of the market. Great. Thanks for the questions, Jon. Our final question comes from Debanj ana Chatterjee at Jone s. Please go ahead, Deb and Jana. Hi. Thanks for taking my question. I have a couple. The first two is for the Sagimet team. When can we get the longer-term, like 52-week safety data from Ascletis phase three trial in acne? Hi, Debanj ana. Thanks. We're working with Ascletis right now to retrieve all the data sets. What I will say is that they have extended the 240 patients that were on denifanstat in the primary trial to collect safety data. It's our understanding that we may anticipate a rolling submission from them where they submit the primary data set, the primary secondary endpoints, as Dr. Bhatia walked through earlier. They will supply the additional safety data as it becomes available. The last patient dosed in the study was in mid-February. That should give you a pretty good understanding of when we would see the full safety readout at the completion of those patients taking medications for 12 months. Okay. Great. Thank you. Very helpful. For the phase one study that you have initiated, I believe the PK data might come in some months. I was curious about the part with the acne patients. What are the exact endpoints that you will be assessing for those patients in the phase one? When do you think we might see the data? Yeah. Eduardo, let me answer. Let me answer the latter part of your question first. When we'll see the data? In any phase one, it's hard to predict because we have to escalate the doses, and it's a fine-tuning exercise. Our expectation is to start the phase two next year. At some point between that, and I'm sorry, I can't give you anything more specific, we will have the phase one data. Now, as to the acne patients, sorry, as to the individuals with acne subset entering the study, this is a way that we found to take advantage, if you will, of the fact that patients with acne are otherwise healthy individuals. Since phase one is a study in healthy individuals, why not have a cohort at the end when we have doses slightly more defined that happens to have acne? In that population, we again assess the sebum, sebum meter, sebum tape, and see if any changes appear on the skin. Importantly, this will be a 28-day cohort because that's, again, how it's done in this setting. It is probably something that we will not be seeing the same results that we would see with 12 weeks of treatment. Nevertheless, why not see what we have early on as far as markers go? That's the rationale for the cohort, and that's roughly what can be expected. Anything else, that's great, but I'm not going to promise that. Sure. Okay. Thank you. The last one is for Dr. Bhatia. Could you speak to the insurance dynamics that you see in acne? Do you expect any insurance pushbacks for any premium price therapies or step edits? I mean, the acne market is built on that. It's built on what have patients tried and failed? What is their tolerability? What are their exemptions for perhaps female childbearing potential? Is there anything that's in their patient profile that we can use to, again, justify the therapeutic regimen? Most of the time, we are seeing acne prescriptions come through when we basically justify the rationale for the combination. There are some brands that are facing a few more challenges than others. Some of that is based on the pharmacies, perhaps specialty pharmacies that they're linked to. Right now, we are mainly dealing with generic antibiotics, except for the, say, Sera brand, which is, again, dedicated to acne in its marketplace. The low-dose antibiotics that have come out that are focused on inflammation, both Oracea and the new one by Journey, they're based on treating rosacea. They're off-label for acne. The topical market with the retinoids, again, we optimize the tolerability of vehicles to emphasize why they should be covered over generic tretinoin, which can often be, again, very harsh and very limited in tolerability. Most benzoyl peroxide preparations are now over the counter. Salicylic acid wash is over the counter. We are seeing azelaic acid more being compounded than freestanding Finacea, which is, again, off-label. It is more for rosacea. Rob gave a description of some of the dynamics—I'm sorry, the available market—sorry, available prescriptions in the market. The market is still flush for a need for something new that would be easier to take and well tolerated. I would say a lot of what we see with insurance and step edit is basically something that can be easily countered by the role of the dermatologist in being aggressive in supporting the patients. Thank you so much. Thanks for the informative session. Thank you for the questions, Debanj ana. That concludes today's Q&A session for today. I will now turn it back over to Dave for closing remarks. Yes. Thanks, Tara. I just want to thank Dr. Bhatia for his time and thank all of you for taking the time out of your day to join us for this discussion. We're really excited, obviously, about this program and the direction and the possibilities and the options for patients who are living with moderate to severe acne, as well as how we're pursuing development for our MASH program. Today, it was really a discussion about acne and really the potential there. Really want to thank all of you for joining us in this call. Have a great rest of your day.