Q1 2024 Veru Inc Earnings Call

Thomson Reuters StreetEvents02-09

Participants Michael Purvis; Executive Vice President, General Counsel & Corporate Strategy; Veru Inc. Mitchell Steiner; Chairman, President, CEO; Veru Inc. Michele Greco; CFO & Chief Administration ...

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With me on this morning's call are Dr. Gary Barnett as Chief Scientific Officer, Michele Greco, the CFO and Chief Administrative Officer, Michael Purvis, the Executive Vice President, General Counsel and Corporate Strategy, and Sam Fisch, Executive Director of Investor Relations and Corporate Communications Thank you for joining our Q1 fiscal year 2024 earnings call. Failure is a late clinical stage biopharmaceutical company focused on developing innovative medicines for high-quality weight loss, oncology and ARDS. The company's drug development program includes two late-stage novel orally administered small molecules, Novozymes and some visibility weight loss pipeline leads off with enobosarm, also known as Ostarine MK two eight six six GTXO. two for 4 22 and through oh two for these are all the identical same molecule enobosarm, which is an oral selective androgen receptor modulator","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"VERU":"Veru Inc."},"translate_title":"Q1 2024 Veru Inc收益看涨期权","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"VERU":0.9},"content_text":"Participants\nMichael Purvis; Executive Vice President, General Counsel & Corporate Strategy; Veru Inc.\nMitchell Steiner; Chairman, President, CEO; Veru Inc.\nMichele Greco; CFO & Chief Administration Officer; Veru Inc.\nGary Barnette; Chief Scientific Officer; Veru Inc.\nDennis Ding; Analyst; Jefferies\nLeland Gershell; Analyst; Oppenheimer & Co., Inc.\nYi Chen; Analyst; H.C. Wainwright\nPresentation\nOperator\n Good morning, ladies and gentlemen, and welcome to the Veru Inc's investors conference call. All participants will be in listen-only mode. Should you need assistance, please signal the conference specialist by pressing the star key followed by zero. After this morning's discussion, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Mr. Michael Parvez, Veru Inc's, Executive Vice President, General Counsel and Corporate Strategy. Please go ahead.\nMichael Purvis\n Statements made on this conference call may be forward-looking state forward-looking statements may include, but are not necessarily limited to statements of the Company's plans, objectives, expectations or intentions regarding its business operations, regulatory interactions, finances and development and product portfolio Such forward-looking statements are subject to known and unknown risks and uncertainties, and our actual results may differ significantly from those projected suggested or included in any forward looking state risks that may cause actual results or developments to differ materially are contained in our 10Q and 10K SEC filings as well as in our press releases from time to time. I would now like to turn the conference call over to Dr. Mitchell Steiner, Veru Inc's, Chairman, CEO, and President.\nMitchell Steiner\n Good morning. With me on this morning's call are Dr. Gary Barnett as Chief Scientific Officer, Michele Greco, the CFO and Chief Administrative Officer, Michael Purvis, the Executive Vice President, General Counsel and Corporate Strategy, and Sam Fisch, Executive Director of Investor Relations and Corporate Communications Thank you for joining our Q1 fiscal year 2024 earnings call. Failure is a late clinical stage biopharmaceutical company focused on developing innovative medicines for high-quality weight loss, oncology and ARDS. The company's drug development program includes two late-stage novel orally administered small molecules, Novozymes and some visibility weight loss pipeline leads off with enobosarm, also known as Ostarine MK two eight six six GTXO. two for 4 22 and through oh two for these are all the identical same molecule enobosarm, which is an oral selective androgen receptor modulator. Novastar is being developed as a treatment in combination with weight-loss drugs to augment fat loss and to avoid muscle loss in overweight or obese patients for chronic weight management in our oncology pipeline with developing enobosarm as a treatment for Andrew receptor positive estrogen receptor-positive human epidermal growth factor receptor two negative metastatic breast cancer in the second line step setting our infectious disease pipeline, which is pending additional external funding or pharma partnership is to visit Bjorn, a microtubule disruptor, which is being developed as a Phase three in a Phase three clinical trial for the treatment of hospitalized patients with viral induced ARDS company also has an FDA-approved commercial products, the FC2 Female Condom internal condom for the dual protection against unplanned pregnancy and sexually transmitted infections. This morning, we'll provide an update on our Company's primary focus, the development of enobosarm, an oral arm in combination with weight loss drugs like glucagon-like peptide one receptor agonist, which we're going to refer to is equip one with Glip one receptor agonist. These are being used to avoid have Nozomi combination is used to avoid muscle loss and physical function loss to augment that loss and potentially result in higher quality weight loss will also provide financial highlights for our first quarter of fiscal year 2024 clip one receptor agonist like this impact with COVID step and the majority are very effective weight-loss drugs. Unfortunately, clinical studies have shown that up to 50% of the total weight loss comes from muscle, which is problematic as muscles necessary for metabolism strength and physical function loss of muscle. Maybe also one of the reasons why patients on quick win with drugs, which a weight loss plateau, meaning they cannot lose anymore weight while taking a grip one receptor agonist drug. According to the CDC, 41.5% of older adults have obesity in the United States and could benefit from weight loss medications up to 34.4% of these obese patients over the age of 60 have start repeating obesity. This large subpopulation of sarcopenia. Could these patients, especially at risk when taking the glucagon receptor agonist drugs for weight loss as they already have critically low amounts of muscle due to age-related muscle loss, further loss of muscle mass. When taking a glucagon receptor agonist medication, it may lead to muscle weakness leading to poor balance decrease. Gait speed, mobility, disability loss of independence falls bone fractures and increased mortality. This can lead to a condition similar to age related frailty because of the magnitude and speed of muscle loss while on a clip one receptor agonist therapy for weight loss with one receptor agonist drugs may accelerate the development of frailty in obese overweight elderly patients. We believe there's an urgent unmet medical need for a drug when given in combination with one receptor agonist that can prevent loss of muscle while preferentially reducing fat and not only all overweight or obese patients, but especially for the large subpopulation of sarcopenia or overweight elderly patients who are at risk of developing muscle atrophy and muscle weakness leading to frailty. We believe that enobosarm a novel oral selective androgen receptor modulator may be the best drug candidates to address this unmet medical need. Notice arm has has been previously studied in five clinical studies involving 960 older men and postmenopausal women as well as older patients who have muscle wasting because of advanced cancer. Advanced cancer stimulates a starvation state where there's significant unintentional loss or wasting of both muscle and fat mass like what is observed with the group one receptor agonist treatment. The totality of the clinical data from these five clinical trials demonstrated enobosarm treatment leads to dose-dependent increases in muscle mass with improvements in physical function as well as significant dose-dependent reductions in fat mass. The patient data that were generated in these five enobosarm clinical trials in both elderly patients and in patients with cancer induced starvation like state provide strong clinical rationale for Novozymes. Our hypothesis is that I noticed arm in combination with a clip one receptor agonist will potentially augment the fat reduction in total weight loss while avoiding muscle loss. In addition, enobosarm has a large safety database, which includes 27 clinical trials involving 1,581 men and women dose with enobosarm with a duration of treatment in patients for up to three years. And this large safety database, enobosarm was generally well tolerated and no increase in gastrointestinal side effects this is important and there's already significant and frequent gastrointestinal side effects with it with one receptor agonist treatment alone. As for enobosarm clinical program for high quality weight loss this week I'm happy to report that the FDA has cleared our investigational new drug application for our Phase IIb, multicenter, double-blind, placebo-controlled, randomized dose-finding clinical trial designed to evaluate the safety and efficacy of enobosarm three milligrams, six milligrams or placebo as a treatment to augment fat loss and prevent muscle loss in approximately 90 randomized sarcopenia, obese or overweight elderly patients receiving semaglutide who are at risk for developing muscle atrophy and muscle weakness. The purpose of the Phase IIb trial is to select the optimal dose of enobosarm in combination with a glucagon receptor agonist that best preserves muscle and reduces fat and the 16 weeks of treatment to advance into a Phase three obesity overweight clinical trial, the primary endpoint of the Phase IIb clinical trial will be the change in lean body mass from baseline to 16 weeks. And key secondary endpoints will be the change in baseline to 16 weeks in total fat mass insulin resistance total body weight and physical function as measured by stair climb tests. We plan to initiate a Phase IIb clinical study in April 2024, and the clinical study will be conducted in approximately 15 clinical sites in the United States. That top line clinical results from the Phase IIb clinical trial were expected at the end of calendar year 2024 we believe that assessing the effect of enobosarm, a lean body mass and fat mass at 60 weeks should be adequate to demonstrate significant loss of muscle in the semaglutide plus placebo cohort support comes from the STEP one study reported by waving at all in the New England Journal of Medicine publication. In the STEP one study, it evaluated semaglutide for weight loss in overweight and obese patients and showed that 49% of the total weight loss in the 68 week study actually occurred by week 16% and 40% of the total weight loss was attributable to attributable to weight out to muscle loss. After completing the 16-week efficacy dose-finding portion of the Phase IIb clinical trial is planned. Participants would then continue into an open label extension trial where all patients will receive six milligrams and the noes are monotherapy for 12 weeks to determine the ability of enobosarm to rescue with reverse the muscle loss and prevent fat and weight rebound after stopping it with one receptor agonist. The results of this of the separate Phase IIb open-label extension study are expected in calendar Q2, 2025. And summary, our Phase IIb clinical program is designed to provide clinical data to support the development of enobosarm for high quality weight loss for two possible patient populations first population knows on dose finding will be evaluated in a large at-risk population of obese overweight patients who are these who are the sarcopenia obese or overweight elderly patients receiving with one receptor agonist for weight loss. Enobosarm with one receptor agonist combination therapy has the potential to to augment weight loss by preferentially increasing fat loss while preventing muscle loss, improving physical function potentially leading to higher quality weight loss. Second, enobosarm monotherapy treatment for the at risk sarcopenia, obese overweight elderly patients who discontinue and flip one receptor agonist. In this case, enobosarm a rescue the patient by increasing muscle mass, improving physical function while preventing the rebound, weight and fat gain that typically occurs when the glucagon receptor agonist is stopped, we believe we have sufficient financial resources on hand, which includes the recent financing of net proceeds of $35.2 million to complete and provide results from both the Phase IIb clinical trial and the open label extension clinical trial. I will now turn the call over to Michele Greco, CFO, CAO, to discuss the financial highlights. Michel?\nMichele Greco\n Thank you, Dr. Stein. Our overall net revenues were $2.1 million compared to $2.5 million in the prior year's first quarter. The U.S. prescription channel net revenues increased to [$634,000] from [$163,000] in the prior year's first quarter as a result of increasing sales through our telehealth portal, global public sector net revenues decreased to $1.5 million compared to [$2.3 million] in the prior year's first first quarter due to the timing of orders and shipments. Gross profit was $1.2 million or 54% of net revenues compared to [$702,000] or 28% of net revenues in the prior year's first quarter. The increase in gross profit and gross margin is driven primarily by the change in the sales mix with our US, FC2 prescription channel representing 30% of net revenues in the current period compared to 7% in the prior year period. Sales in our US prescription channel have a higher profit margin. On December 18, 2023, we completed an underwritten public offering of our common stock, which included the exercise in full of the underwriter's option to purchase additional shares. Net proceeds to the Company from this offering were approximately $35.2 million after deducting underwriting discounts and commissions and cost incurred by the company. All the shares sold in the offering were offered by the company as of December 31, 2023, our cash balance was $40.6 million compared to $9.6 million on September 30, 2023. We believe our current cash balance will be adequate to fund the planned operations of the Company as we continue to focus on developing enobosarm for high-quality weight-loss. Now I'd like to turn the call back to Dr. Steiner.\nMitchell Steiner\n Thank you, Michel. Has only been recently that a significant clinical need to avoid adverse effect of significant muscle loss caused by clip. One receptor agonist has been appreciated. All the glucagon receptor agonists work by creating a starvation state that nonsense effectively reduces both muscle and fat tissues to cause weight loss using a muscle preserving drug in combination with one receptor agonist would potentially allow for a higher quality weight loss. I want to emphasize it knows that was not competing with Glip one receptor agonist drugs that are already on the market or under development. The weight loss. The expectation is that enobosarm may be potentially combined with any one of the many with one receptor agonist drugs to them to avoid muscle loss and to augment fat loss. This is truly a new indication. We believe enobosarm is the best investigational drug candidate to address the muscle whilst COSMIC-021 receptor to actual weight loss and those armies of first and cross sell as oral once-a-day dosing has demonstrated tissue selectivity and utilize a well established known mechanism of action. The androgen receptor favorably change body composition, activate activation of the Andrew receptor increases, muscle mass boost physical function and decreased fat mass to potentially achieve a higher-quality weight loss. There was a favorable safety profile would not add to the gastrointestinal side effects that are already observed with equivalent receptor agonist. Global obesity and overweight drug market is projected to be $100 billion by 2030. It should be emphasized that knows that may potentially be combined with any one of the group one receptor agonist weight-loss drugs not only for older overweight at risk patients, but also all overweight or obese patients want to avoid muscle loss while taking it with one receptor agonist for weight loss, the combination of enobosarm and the glucagon receptor agonist potentially represents a multibillion-dollar global opportunity. We are very excited about the prospects of enobosarm to address this new and important unmet medical need with the FDA go ahead. We're looking forward to the initiation of this important and timely Phase IIb clinical study. With that, I'll now open the call to questions. Operator?\nQuestion and Answer Session\nOperator\n Ladies and gentlemen, at this time we will begin the question and answer session. To ask your question. You may press star, then one on your telephone keypad. If you're using a speakerphone, we ask that you pick up your handset before pressing the keys to ensure the best sound quality to withdraw your question, please press star then two. Please limit yourself to one question and one follow up. If you have further questions, you may reenter the question queue. Once again, that is star one to rejoin the question queue. Our first question comes from Dennis Ding with Jefferies. Please go ahead.\nDennis Ding\n Hi, good morning. Thanks for taking my questions and congratulations on all the progress on this one for me around the OPC. program, given various GLP ones, have different levels of weight loss as well as muscle wasting, what what's clinically meaningful level of muscle preservation and what's clinically meaningful additional weight loss that you guys are looking for in your Phase IIb? And how do you define success from that trial? Thank you.\nMitchell Steiner\n Good questions. So the first question relates to how we're going to view muscle loss and particularly in the context of a Phase two. So you're actually right on all the good ones and they have muscle loss associated with them because the mechanism is hyper caloric calorie, in other words, low calorie amounts. And that's why the muscle ways if that weighs it doesn't it's not specific one tissue type. They all do it because it ranges about 20% to about 50%. And a lot of it depends on the potency of the group. When we subtract it's more potent and more muscle use with that success for us at 16 weeks is a show that we can make basically maintain muscle because we know we're going to be losing about 40% of muscle with semaglutide. And we picked in our Phase IIb study, only one group one receptor agonist. So we don't have the confounding concern that each group one receptor agonist may have a different muscle loss amount. So we use a semaglutide, which is on Wegovy. And so the expectation based on the STEP one study is about 40% of the muscle loss of the half of the [30%] weight loss that occurs in the first 16 weeks will be at that point. We will define success as you stop in the decline. And so the delta is going to be the difference between what we maintain and what was lost. And if we can maintain and stop the decline in function and maintain function. That's that's considered a success. The success and this is important is that fat loss and total body fat loss correlates with weight loss ultimately week 48, we chose to go to 60 weeks because we're using this the DEXA scan think of as sort of a biomarker. We know if we maintain muscle at 16 weeks we are maintaining muscle at 48 weeks. If you lose fat and preferentially was more fat in 16 weeks, you expect to see a deeper fat loss at 48 weeks so the idea is dose and the 48 weeks now in the phase to get the information you need, which could be a business examples of other drugs in which they showed maintenance of muscle and showed reduction of fat at 16 weeks and it was [5 million] or 48 weeks. You saw a further decline in fat and for the kind of weight loss with that success for us is, again, focusing on lean body mass being maintained. Fat will have greater fat loss at the 16-week time point. Now in terms of total weight loss meal. If we had a situation where we had a weight loss, a comparable in both arms, that would be great because what you're basically saying is a RMB1 loss of fat. And I will now be the you know, that will be the semaglutide. We lose fat in muscle in the treated arm with Windows ARM. You maintain the muscle loss fat, but you had the same weight loss. That's a high quality weight loss. But the expectation is if you leave the muscle alone, you can get a deeper weight loss. As I mentioned in my comments, the concern is that and you can look at any one of these 48 week, 70 plus week studies and lay press that people will tell you that after about 16 to 20 weeks on a group one receptor agonist, they hit a plateau. They just can't lose any more weight. What's happening there is the lost enough muscle of kicks back in their appetite. And that's why people saying I do is this an exercise to quoting it. All these studies have that same plateau. How do you get beyond that plateau? And the answer is if you can maintain muscle, you can have a much deeper way laws of fat compartment in obese patients, so much larger in the muscle compartment. It's just you can't get to it because for every pound of muscle you take a pound of fat, you take you pay with a pound of muscle of the 60%. And so success for us would be if we can show comparable weight loss with different kind of body composition at 16 weeks, the expectation that that would ultimately translate into a greater weight loss at 48 weeks, which was the Phase threes would be studying. And with that said, the agency has made. Maybe I could have maybe made it clear, that's what we're looking for. If you look at total weight loss as your endpoint at 48 weeks is a incremental increase in weight loss. But the equivalent increase in weight loss at about 5% of the total weight loss by the control arm. So is that five percentage points, 5% points greater is 5%. Obviously, this is a low bar to hit. But if we can do that same low, borrow greater and maintain muscle than that, which means most of that weight loss was fat, that will be success at 48 weeks. And so hopefully, I answered your question here.\nDennis Ding\n Yes, yes. And maybe a quick follow up on your remind us some of the statistical assumptions from the Phase IIb and whether the study is powered to show that say? Thank you.\nMitchell Steiner\n Yes, I'll be happy to see when we didn't have Dr. Gary Barnett answer that question. So Gary, can you can you talk about the the sample size and power?\nGary Barnette\n Yes, since they're born out of the way we did is we looked at the STEP one study, STEP one study law of about six kilos of RE/MAX over a 68 week period that keep you just do assume a linear loss of muscle that would be 0.102 kilos per week, multiply that by 16 weeks you get approximately 1.6 kilos of loss of lean mass in the first six to eight weeks in the control arm, meaning the blip one plus placebo in. If you look at our data that we had in obese patients of these patients with cancer cancer, as Mitch mentioned, cancer has a tendency to create a hydrochloric state and much like a starvation state. We basically maintain lean mass in that patient population. So it's a 0.3 kilo loss to a 0.4 kilo increase. So what we did is we used that Alpha 0.052 sided, 80% power comparing of a 1.6 kilo expected loss in the control arm versus a minus three kilo or minus 0.3 kilo loss in the treated group, and that's approximately 26 subjects per arm. We powered at three 30. Now let me also say this, as Mitch mentioned, 49% of the of the loss of weight occurs in the first 16 weeks of a group one treatment. So what happens if you use that that number and say that 49% of the muscle also lost that three over three kilos of lean mass, we're expected to lose, but we're being conservative in our sample size calculation using 0.3 negative 0.3 versus negative 1.6.\nMitchell Steiner\n So the expectation is you're going to have a much greater muscle loss than we planned. Then we put into the numbers to be conservative in the in the arm. It's getting the semaglutide without NovaStar.\nDennis Ding\n and I think it was very helpful. Thank you.\nMitchell Steiner\n Thank you. Thank you for the question.\nOperator\n Next question comes from Leland Gershell with Oppenheimer. Please go ahead.\nLeland Gershell\n Hey, good morning, Mitch. Thanks for taking our questions. If you could just review with us how you're going to define the eligibility in terms of what it means to be sort of clinic for entry into the the trial?\nMitchell Steiner\n Yes. So the so what we're doing to make sure we get the biggest patient population as possible is restricting me to age. So we look at it we say greater than the age of 60 great age of 60 puts you in that population of 42% of patients that could potentially use a obesity drug because they're obese or overweight. So that gets you a wide net. We also know and this comes from our previous experience and frailty, and I'm going to pause for a moment. I mean, Dr. Gary, Brian and myself and Domingo at regas and Gary Burge dissolved people here. We worked on. We've been working in a space of frailty vote, no for at least 15 years with enobosarm in these patient populations that we have to find that we have shared you to share the data, both in frailty patients, postmenopausal women and also cancer wasting patients that are older, we and I bring that up is that we had to deal with all the endpoints. The FDA wants physical function. We have to understand the the amount of muscle that somebody who's the 60, the age of 80 and what's the critical amount of muscle that gets you to a point that you have problems with a functional limitation here and there with functional limitations, mobility visibility. So we bring all of that history with us as we look at this accelerated development of frailty that occurs in older patients. So the fact is you're 60 you're already beginning to decline in muscle. And so the idea is rather than now trying to come up with the sarcopenia population, soccer panic definition for a population for which there are many just just allow patients over the age of 60. They're going to have reduced muscle mass, follow them along for the 16 weeks. And if you're going to lose of medicine. And Dr. Bernotat said you do as much as three kilos, 3.5 kilos, semaglutide alone, you're accelerating frailty, you're going to you're going to see problems. So we want to have a wide wide net. So the way to think of it is we used greater than 60 as the as the eligibility of the overweight obese that patient populations enriched for the patients who will get into 12.\nLeland Gershell\n That's very helpful. And then just a follow up being that from what we understand in order to maintain benefit from weight loss from the GLP-1 therapy. One has to stay on that therapy for now for long term effectively for life. How do you view the ultimate use of enobosarm, assuming approval on overtime, which would it be used as well kind of the entire time that GLP-1 is used? Or would it be used only during the time that the weight loss is actually occurring then once the patient achieves their target weight or their plateau rate, they could go off since they wouldn't be losing anymore mass as we think about that.\nMitchell Steiner\n Yes, so part of the reason we're doing the Phase IIb, the way we're doing it is to get some questions answered to address that question. So for example, the first part, which is the primary study is in combination with a glib one know how does enobosarm work. We maintain muscle, how much additional fat do we lose. And so that gives you that information and of course, physical function and seeing how we can prevent the decline of physical function. The second part, the open label study is kind of addressing the question you asking that is if you stop the clip one for the patient that did not take enobosarm in combination and they've lost muscle in the fears of the stop of Group one to get the rebound weight gain, which is almost our fat. You've actually made them worse because now they have less muscle and they have the same weight, but it's all fat and weaker. And so it will be nice to see what the effect of enobosarm is in that situation to rescue and prevent the rebound weight gain, in fact, gain. And those pieces of information will allow us to think more globally at a high level like you're thinking, that is how it used. So here's some examples. One, it could enobosarm, which by itself has a direct effect on reducing fat and maintaining muscle in combination with Glip one receptor agonist be used in combination. So you use less of a good one receptor agonist as you know, receptive group one receptor agonists have a GI toxicity. And that's the reason why people have to know all kinds of gastrointestinal pain, nausea, vomiting, diarrhea, imploding, and that kind of stuff and we can decrease some of those with an agent like enobosarm. It doesn't have any of that, then you could have a situation where the combination of equip one with enobosarm, you have less of the Group one, potentially the other. The other way to think of it is the biggest problem that that is occurring now as everybody got onto clip once they recognize and they hit this plateau. And the plateau, as I mentioned in my formal comments is because it's big, particularly in sarcopenia, could these patient an elderly patient where they have very little muscle reserve happens because the muscle goes down to a critically low level. It kicks off the appetite mechanism appetite mechanism pretty powerful, long lead. You die and so that happens then you basically have a push me pull you with a quick one is making you lose weight or lose weight. While the appetite is asking you to put the weight back on all because of muscles trigger that if you maintain muscle. And the question is, can you have a deeper fat loss if you have a deeper fat loss. Then then again, the combination of our drug plus a quick one would be a higher quality, but better from the point of view that you mentioned, that is what is the target weight loss that you want. So if you wanted to target weight loss, that's beyond what you muscle will allow. Again, if you do the 50 50 rule of every pound of fat, you lose you lose a pound of muscle. That's a lot to pay for it because you'll have to make that payment and you can lose a lot more of the fat than then you can have a better success in getting to your target weight potentially. And so that could be very interesting in getting rid of the plateau and so again, I would see enobosarm in combination with group one will allow you to manipulate the clip one to produce dose potentially and to potentially get to your target weight without hitting a plateau. Now what happens if we wanted to stop calling it, the chronicity of a quick one. Did you take it for the rest of your life and some people wanted to get off of it because side effects. So if you could have a drug like enobosarm that could be given almost like you're cycling. So you stopped equip one, keep the enobosarm going, can you maintain muscle and and and those are has direct effects on fat to decrease the potential for the rebound effect and then bring back with one if you want to know if you want to get back to your target weight again and to keep avoiding that accelerated rebound and just have a more gentler weight loss. And that's when I say high quality, high quality means weight loss, will your muscle and fat body composition is such that you the appetite mechanism that gets you into trouble summary? I see us being used in combination with a quick one to chronically potential changes with one dose potentially using the drug to help you decide how you want to start to flip one and add it back in. And then furthermore, for those patients that got into trouble, that did not start with enobosarm integrate Blue one and want to discontinue the drug than they have an opportunity to build a muscle back if they lost significant muscle would potentially stop there and fat rebound weight gain. So there's a lot of information there, but I think the Phase IIb again, it's not meant to be the Phase three study where you say oh, can we look at weight loss of 48 weeks and my 5% we are greater than 5% greater than the weight loss of the control arm. I know this is asking the very critical questions of how ultimately we want to use enobosarm and the very high level. The two areas are where the Scope one and second area is to rescue somebody on a per point, Larry,\nLeland Gershell\n thanks for the added information.\nMitchell Steiner\n Thank you again.\nOperator\n If you have a question, please press star, then one to withdraw your question, press star then to our next question comes from E. Chan with H.C. Wainwright. Please go ahead but\nYi Chen\n thank you for taking my questions up. Just to clarify because that is the sum has the ability to preserve muscle mass in the Phase IIb trial. It is it possible that within the first 16 week of enobosarm plus GLP-1 drug VERSUS GLP-1 drug that for the combo arm, we could see patients it's less total weight versus GLP-1 one drug alone on its own right.\nMitchell Steiner\n And no, no, I don't think so. I think I think what you're going to see in this situation is what's missing in your characterization of enobosarm is enobosarm does two things. One is it preserves muscle into it also augments the fat loss. So that so so as Amit, so group one receptor agonist by itself, it's muscle and fat and and so we have a situation where you maintain the muscle we can we're not trying to make Arnold Schwarzenegger, so not trying to pick a dose that you put so much muscle on that that has to counteract the amount of fat that you've lost. Part of it is can you dial down the muscle part so that you maintain muscle, but you make it out by reducing the fat even more than a clip one by itself. That's that's the idea. If you didn't have direct effects on femto say, okay, I don't know what's going to happen, but it has direct effects on fat. And so it could be possible with a higher dose of enobosarm, knowing you have same muscle, similar muscle maintained down, but you have a greater fat loss. So we're going to learn that in the Phase IIb at 16 weeks. And so again, the key thing here is can we maintain the muscle, you get deeper and deeper fat loss and and the semaglutide is going to take muscle and fat equally in, but we budget it seems weak.\nYi Chen\n Would it be meaningful to have an arm receiving enobosarm?\nMitchell Steiner\n Yes. So we sort of we thought about that because because enobosarm alone would be very, very interesting. But we have, again, not an obese patients, but we have in patients that are normal postmenopausal elderly patients. So we know a lot about Novozymes in that setting as monotherapy. And we do have data from fiber for study in a subset of patients that were obese in the lung cancer study that pretty much falls in line. But what I'd just add and that is what we saw in that study where the cancer causes basically a starvation state that we saw we were able to maintain muscle muscle was about 0.3 kilos where the arm where the clip one lost about, I guess in that study about three kilos is something that store and that and we look at total weighted 21 weeks that there was much greater weight loss in the and in the AD enobosarm arm than the placebo arm in that patient population where we saw the weight loss was due to the fat loss because you maintain the muscle. So we do have data right that I think for purposes of this study here, we're not trying to make enobosarm by itself. The weight loss drug, I think we'd need to get some clarity. And again, no, no company out there at this point now has clinical data in combination with one of their drugs is to get that information because that's more important understanding. What is the what is the magnitude of the hypo caloric influence and what is the dose we need to counter that and then that allows you you ask additional questions later.\nYi Chen\n Got it. you mentioned that in your future Phase three trial, the endpoint could be measured at at 48 weeks is that correct? And I also wonder how many patients could be required to for a future Phase three trial and whether the route plans to conduct the trial by itself or potentially with a partner? Thank you.\nMitchell Steiner\n Yes. So the answer is we absolutely seeking a partner. But the way we're designing this study is the way we're thinking about it is you have a Phase three that is potentially an all-comers study, in which case weight loss as your endpoint and the weight loss endpoint audience shows 5% incremental increase, which means that would be again the standard endpoint at 48 weeks. The FDA wants you to be at least a year. However, embedded in that study, the patients are in our Phase IIb greater than 60 years of age. And our and the reason we picked that patient population because of physical function and potentially lean body mass could be interesting endpoints in itself. So depending on how our discussions go with the FDA, do we focus on a subpopulation of which the clinical benefit risk ratio is different and the endpoints are going to be different potentially or do go after a weight loss population and in which case you're not worried about muscle just get the muscle function because that will be something that you could put a new label. And I think that will be important, but get, you know, get get the endpoint of a 5% better in weight at week 48 and you get it. And Gary, do you want to add to add to that?\nGary Barnette\n No. I think that the outcome of the study that we're running will dictate that will dictate where we go and how big that study will be what the primary endpoint will be, whether the FDA just purely looking at weight loss or whether they're looking at weight loss, admits, mid-teens as a with a component of body composition, increasing or maintenance of lean mass and increasing fast reduction would be, in my opinion, a very positive outcome for this for these patients. And that quality. What I what I'm going to term as quality weight loss would be very important for overall health health benefit.\nMitchell Steiner\n The fact that we're measuring physical function, we know the FDA likes of how patient feels functions or survives. And so that's why the stair climb test, which is a key component of the Phase IIb is important because I think that will also influence how we think about endpoints in a phase that ultimately, we think we think enobosarm as a kind of a programmatic molecule, meaning that you're looking at rescue looking at decreasing doses of flip ones you're looking at being used in combination with the whole population you lose use in combination with the with the at risk population and potentially be used in combination with a myostatin inhibitor can potentially be used. So I think this can be pretty interesting and down. And so you know what we are active in trying to find a partner that has the resources to allow us to explore all these possibilities.\nYi Chen\n Thank you.\nOperator\n Ladies and gentlemen, this concludes our question and answer session. I would like to turn conference back over to Dr. Mitchell Steiner for any closing remarks.\nMitchell Steiner\n Thank you, operator. I appreciate everybody being who joined us on today's call, and we're very, very excited about the prospects at enobosarm, and I look forward to updating you on our progress in the next investor call. Thank you.\nOperator\n A digital replay of the conference call will be available beginning approximately noon Eastern Time today, February eighth by dialing one eight seven seven three four four seven five to 9 in the US and one for one two three one seven zero zero eight eight. Internationally, you will be prompted to enter the replay access code, which will be 8 to six zero zero six six. Please record your name and company when joining the conference call has now concluded. 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