Aclaris Therapeutics, Inc. (ACRS) Earnings Call Transcript & Summary

Good morning. I'm Matthew Rothman. Counsel for Aclaris. Before we begin our prepared remarks I would like to remind you that the various statements we make during this call about the company's future results of operations and financial position, business strategy and plans and objectives for Aclaris' future operations are considered forward-looking statements within the meaning of the federal securities laws. Our forward-looking statements are based upon current expectations that involve risks, changes in circumstances, assumptions and uncertainties that could cause actual results to differ materially from those reflected in such statements. These risks are described in the Risk Factors section of Aclaris' Form 10-K for the year ended December 31, 2020, and other filings Aclaris makes with the SEC from time to time. These documents are available under the SEC filings page of the Investors section of Aclaris' website at www.aclaristx.com. All of the information we provide on this call is provided as of today, and we undertake no obligation to update any forward-looking statements we make on this call on account of new information, future events or otherwise. Please be advised that today's call is being recorded and webcast. A link to the webcast can be accessed under the Events page of the Investors section of our website. I'll now turn the call to Dr. Neal Walker, President and CEO of Aclaris. Neal?

Good morning, everybody, and thank you for attending Aclaris Therapeutics Virtual R&D Day. And today, we'll be discussing the productivity of our platform. So a little bit about our agenda and the presenters. So I will be presenting along with our CSO, Joe Monahan and our VP of Biology, Paul Changelian. We'll start out with an introduction of the company and an overview of our portfolio. We'll then move to some specifics on our MK2 inhibitor program, talking first about a clinical update on Zunsemetinib, ATI-450, which is our investigational MK2 inhibitor. We'll then talk a little bit about our role of MK2 in IL-17 biology. And then finally, in this section, we'll talk about ATI-2231, which is our second MK2 inhibitor that we're looking at for indications like oncology. Next, we'll talk about ATI-2138, which is our oral small molecule. It's a covalent binder of ITK, TXK and JAK3 and recently, we announced that the IND was allowed. So we'll be talking about our clinical plans moving forward. And then next, we'll be talking about some of the work we've been doing on gut-biased JAK inhibitors for inflammatory bowel disease. And then finally, I'll have some closing remarks, and then we'll allow Q&A. So first, a little bit about the company. Aclaris is a development-stage biopharmaceutical company focused on developing small molecule therapeutics for immuno-inflammatory diseases. There are 3 important components to help drive success. First, the people. We have world-class experts that are from companies such as Pfizer and GSK with years of experience at developing kinome targeted medicines. Second is the platform. We have a proprietary drug discovery engine that's composed of a proprietary chemical library combined with a fully integrated multidisciplinary discovery team. This allows us to advance our small molecule drug candidates from concept to development candidate in some cases in less than half the time of larger organizations. And third is our innovative pipeline. We have 3 clinical stage assets, which we'll talk more about in addition to an early preclinical pipeline that is currently building. So next is our drug development pipeline. Zunsemetinib, ATI-450 is our MK2 inhibitor. This is an oral small molecule, and we're looking at 3 indications: rheumatoid arthritis, hidradenitis and psoriatic arthritis. These are all Phase II clinical-stage assets. Next is ATI-1777, this is our soft topical JAK 1/3 inhibitor. And this is for the indication of moderate-to-severe atopic dermatitis and we'll be embarking on a Phase IIb starting next year for that program. ATI-2138 is our oral small molecule covalent inhibitor of ITK, TXK and JAK3. And this asset is geared to get into psoriasis next year and the IND has recently been allowed. Next, our 2 earlier stage programs, our gut-biased program and ATI-2231, which is an MK2 inhibitor. The gut-biased program is an oral small molecule and we're looking at inflammatory bowel disease, and that is at dev candidate stage. And then ATI-2231, our MK2 inhibitor is an IND-enabling tox work at the moment, and we're looking at an IND towards the back part of '22. And here, we're looking at potential indications in oncology. So first, a little bit of an update on ATI-450. Obviously, we have messaged that we will be starting 3 Phase II clinical studies. And I'll be going through a little bit of a high-level design on each of those in the next 2 slides. So ATI-450 in rheumatoid arthritis. This study is designed as a 3-arm study, placebo, 20 milligrams BID and 50 milligrams BID. This is on a backbone of methotrexate. And this study will span over 12 weeks with a 4-week off-drug safety follow-up period. The primary endpoint will be ACR20 responders. And you can see there a variety of secondary endpoints that we'll also be studying. We'll also be looking at a variety of pharmacodynamic parameters as well. We anticipate enrolling both treatment-naive and also treatment-experienced patients, and we opted to test the 20 milligrams and 50 milligrams BID as the top dose in this study since we are already achieving multiples of the IC80 in terms of the relevant cytokine suppression with only a small increment of additional cytokine suppression noted at 80 milligrams and 120 milligrams. Similarly, in HS, we're looking at 2 dose groups, a placebo and 50 milligrams BID. In this study, we'll be looking at a variety of the traditional secondary end points and with one exception, with the primary endpoint, we'll be looking at a mean change in -- from baseline and the change of inflammatory nodules or abscess count. We're looking at this study as more of a proof-of-concept study versus RA and psoriatic arthritis, which we believe will be p-value generating. And finally, the third study that we'll be studying 450 in is the psoriatic arthritis, and this will be in adult patients with moderate-to-severe psoriatic arthritis. Again, placebo and 50 milligrams BID will be the 2 dose groups. We'll look at 12-week primary end point, again, with a 4-week safety off-drug follow-up period. And the primary endpoint will be ACR20 responders with a variety of the traditional secondary endpoints as you see here. And once again, this will be a p-value generating study. So next, I'm going to have Dr. Joe Monahan, walk through the KINect drug discovery platform in a little bit more detail before he gets into his next section. Joe?

Thanks, Neal. The approach that we take to drug discovery is to focus on disease-relevant biologically interesting kinase targets that have proven difficult to drug. Our platform strategy is to tailor the drug discovery approach to the specific kinase of interest. We started off with a team of experienced drug hunters with proven success driving compounds through discovery and into clinical development. We developed custom translatable assays and use structure-based drug design in this process. A unique feature of the KINect platform is the custom compound library that we built using structure-based approach to globally target the more than 300 kinases in the human kinome that have cysteines in and around the active site and that's called the human cysteinome. At Aclaris, we've advanced several compounds through discovery and into development in the clinic for autoimmune inflammatory diseases and cancer using this approach. We're also in the process of reloading the portfolio with discovery process -- sorry, discovery projects that include mutated kinases and neurodegenerative targets. Next slide. We're going to give you first an update on the discovery work that expanded our evaluation of inflammatory cytokines to investigate the role of MK2 and IL-17 biology, and the impact that zunsemetinib or ATI-450 has on that biology. Next slide. This slide is just to remind you the role of the MK2 pathway in regulating the inflammatory cytokines such as TNF alpha, IL-1 beta, IL-6 and IL-8 and the ability of zunsemetinib or ATI-450 to block this. So what we have here is 3 different graphs showing human whole blood and cytokine production stimulated on a left by engagement of the IL-1 receptor, in the middle, engagement of the TLR4 receptor and on the right, engagement of TLR7 and 8 receptor. And we're looking at the inhibition of these cytokines with ATI-450 in a dose-responsive manner. And what you can see across all 3 of these stimuli, we get a dose-dependent inhibition of TNF alpha, IL-1, IL-6 and IL-8 with potencies in the low nanomolar range and comparable potency across cytokines and across stimuli. We wanted to then extend these studies to look at another key inflammatory cytokine IL-17. Next slide. Given the importance of IL-17 in a number of autoimmune diseases, as evidenced by the efficacy of the biologics that target the cytokine and TH17 cells in general, we investigated whether the MK2 pathway is involved in the production of IL-17 or its receptor-mediated function. If MK2 is involved in IL-17 biology, then the axis modulated by zunsemetinib will provide additional mechanistic rationale for the potential utility of this compound in diseases for which we are currently planning Phase II studies, particularly hidradenitis as well as psoriatic arthritis. And additionally, it could potentially open this drug to additional diseases that have an IL-17 signature such as ankylosing spondylitis. The experimental approaches that we're taking with zunsemetinib is to look at IL-17 production in CD4+ T cells and also IL-17 stimulated protein phosphorylation and cytokine production in a number of cells. Next slide. This slide demonstrates the data from the looking at IL-17 production. We're evaluating IL-17 production in human PBMCs stimulated with anti-CD3 and CD28, and we're looking at 4 different donors. And what you can see on the left-hand panel is you see a dose-dependent inhibition of IL-17 production, and this is IL-17A, qualitatively similar results were obtained with IL-17F but you see a dose-dependent inhibition with zunsemetinib and similar curves are obtained with all 4 donors, looking at about 60% to 70% maximal inhibition and IC50s in the low nanomolar range with correspond well with the inhibition potency of zunsemetinib with the other cytokines I mentioned, including IL-1 and TNF alpha. As a control on the right-hand side, IL-2 production was also evaluated and as expected, zunsemetinib had no impact. Next slide. Now we look at the impact of ATI-450 on IL-17 signaling. And this is a schematic of the IL-17 signaling pathway. So the binding of IL-17A or F to its receptor initiates the formation of this complex multicomponent signalosome, which engages ubiquitinases, deubiquitinases RNA binding protein, chaperones and kinases. This signalosome drives the activation of several pathways. It activates 3 MAP kinase pathways. That's the JNK, ERK and p38, and activates the [indiscernible] pathway as well as the ERK5 pathway and it also regulates the activation of a set of RNA binding proteins. So the IL-17 pathway regulates these inflammatory gene production at both the transcriptional level, by modulating transcription factors as well as a post transcriptional level, looking at message stability by activating RNA binding proteins. And the question we wanted to ask is, number one, is MK2 activated by IL-17 engagement with this receptor. And if the answer to that is yes, we then wanted to ask the question, what is the functional consequence of that activation. And that's shown on the next slide. On the left-hand panel, IL-17 induced phosphorylation of the MK2 substrate HSP27 in human dermal fibroblast is evaluated. And we have 3 curves here. We have IL-17 activation of HSP27 or phosphorylation of HSP 27, TNF-alpha stimulation of HSP27 phosphorylation and then the combination of IL-17A and TNF alpha. We use this combination and that has previously shown that both IL-1 and TNF can augment the responses of IL-17. And so the important point here is looking at each of these curves, IL-17 does activate MK2 as evidenced by the phosphorylation of HSP27 as does TNF and the combination has a greater response. So we are seeing a IL-17 dependent phosphorylation of HSP. And then zunsemetinib in a dose response of menace in block this HSP phosphorylation across all 3 stimuli. So the consequence of this is shown on the right, looking at human PBMCs and looking at the chemokine GRO alpha production. And here again, looking at IL-17A, TNF alpha and then the combination. IL-17A can induce grow alpha production as can TNF alpha and the combination looks like it's more synergistic than additive in this case. And again, zunsemetinib or ATI-450 can dose-dependently block this. And the blockade of the phosphorylation of HSP27 and the blockade of the GRO alpha production will have IC50s again in the low nanomolar range. So we extended these studies on the next slide to look at IL-8 and we looked at human PBMC production of IL-8, we looked at human rheumatoid arthritis and over fibroblast cells and ILA production. We also looked at human dermal fibroblast ILA production. That data is not shown, but it corresponds with the other sets of data. And we have 3 sets of borrowers in each panel. The first set of borrowers is IL-17A stimulation, the second set TNF and the third set, the combination. And we're looking at stimulation in the absence of zunsemetinib and then at 3 different concentrations. So if you focus on the first set of bars in the left-hand panel, we do get elevation in IL-8 production in PBMCs stimulated by IL-17A and a dose-dependent inhibition by zunsemetinib. And similarly, with TNF and then the combination. And on the right-hand panel, you're looking at human [ RAS ] fibroblast again, while you see the stimulation with IL-17A by itself, of IL-8 is somewhat low, it is meaningful and it is inhibited as is the combination of 17A plus TNF. The level of inhibition seen in RASFs is lower than what we've seen in PBMCs, but still it's significant. So overall, the signaling data provide evidence that IL-17 activates MK2 pathway and that results in both chemokine and cytokine production that's differentially inhibited by zunsemetinib across disease-relevant cells. Next slide. Now we're going to transition to a second MK2 inhibitor. This is a second-generation inhibitor, ATI-2231, which is a compound that we're moving forward for oncology. Next slide. So I'm going to first go over some details about the biology around ATI-2231. It's an oral drug that was designed for decreased metabolism and clearance relative to zunsemetinib and potentially resulting in lower dose levels. The potency and selectivity is similar, and I'll show you some of that data on the next slide, and we are advancing this compound through IND-enabling preclinical studies with the anticipation of an IND submission for oncology by the end of 2022. Next slide. So now to some of the data. This is looking at the PK of ATI-2231 in comparison with ATI-450 in the rat following oral dosing. And just as a reminder, ATI-450 in humans had a half-life of about 9 to 14 hours. And what you can see from this curve is that ATI-2231 has a longer half-life, has a higher AUC compared to zunsemetinib as a result of lower clearance. So this property should result in extended exposures at or above the targeted pharmacologic level for ATI-2231 at doses comparable to ATI-450. So the next slide shows you the potency and selectivity against the target for ATI-2231. As a reminder, these drugs target the p38/MK2 complex and the goal is to target that complex with a higher affinity relative to p38 in the complex with other substrates or p38 or MK2 by themselves. And the top table shows the potency against this p38/MK2 complex target for 2231 in comparison with zunsemetinib. And again, both are inhibiting this in a low nanomolar range. Selectivity ratios are shown on the bottom table where zunsemetinib and ATI-2231 are very selective against the p38 PRAK complex as well as p38 by itself and MK2 by itself. So the properties of ATI-2231 against the enzyme complex and selectivity are comparable overall to zunsemetinib. The next slide, we advance this into cellular studies. And here, we're looking at the ability of ATI-2231 to block the production of the inflammatory cytokines, TNF alpha, IL-1 beta, IL-6 and IL-8. In human whole blood stimulated by either LPS, which is a top row or IL-1 beta, which is the bottom row. And as you can see, the potency is comparable across cytokines and across stimuli with potency in the low nanomolar range. The only exception is IL-6 stimulated by LPS, which we had seen previously with zunsemetinib, where it's right shifted relative to IL-6 induced by other stimuli such as IL-1 beta, but all the other cytokines and stimuli are in the same low nanomolar range. Additionally, in the bottom left, looking at the curve of phosphorylation of HSP27 2231 in human whole blood will inhibit the phosphorylation of HSP27 in a dose-dependent manner, again, with potency in the low nanomolar range. We then move this into in vivo studies, shown on the next slide. And here, we're looking at the mouse collagen-induced arthritis model, where we've collagen injections on day 1 and day 21 of the model and therapeutic dosing beginning on day 18. We looked at 4 admixed chow doses of ATI-2231 from 30 parts per million to 1,000 parts per million. And on the left-hand side, we're looking at clinical score measurements. And what we can see is a dose responsive reduction in clinical score induced by ATI-2231 with the 2 highest doses giving very high level of efficacy. The activity of 2231 in this model is compared to that of Enbrel in the orange circles and the -- again, the 2 highest concentrations or the 2 highest doses of 2231 have efficacy or activity higher than what we see with Enbrel. On the right-hand side, we're looking at the PK from this model, looking at dose versus exposure, and we see a dose-dependent increase in exposure and activity is observed at exposures of 20-nanogram per ml and greater. So with those data that we have just around the general properties of 2231, the next slide shows us the initial foray into looking at this mechanism and this drug in cancer. Most of the cancer-related nonclinical study that we will describe, however, have been carried out with zunsemetinib, and we're currently bridging these studies to include ATI-2231. And that's the inhibitor that I mentioned earlier that will be moved forward in oncology. And these are collaborative studies with research scientists and physicians at Washington University, and the focus is on 2 different types of cancer, metastatic breast cancer and pancreatic cancer. And the mechanisms are related but distinct as far as metastatic breast cancer, MK2 impacts the tumor microenvironment by activating tumor-associated fibroblast to secrete factors that support tumor survival and inhibiting MK2 can block tumor growth and metastasis as well as protect bone against cancer and chemotherapy-induced bone loss. As far as pancreatic cancer, one of the current standard of care is for FOLFIRINOX is an efficacious combo chemotherapy that's widely used now in pancreatic cancer, but it has a high level of toxicity. One of the components of FOLFIRINOX is irinotecan. And that's the main driver of the cellular stress induced tumor apoptosis, but it also activates the resistance mechanism. And that resistance mechanism involves MK2 and so MK2 blockade should amplify the tumor killing of irinotecan. So the next slide, we'll start talking a little bit about the breast cancer work and this breast cancer work was done as a collaboration in the labs of Sheila Stewart and Cynthia Ma at Washington University School of Medicine. So the next slide just shows you a schematic of the observation that tumors rely on their associated microenvironment for both growth and survival and stromal cells and cancer-associated fibroblasts express and secrete factors that promote tumor genesis through the regulation of a number of biological processes such as proliferation, migration, invasion, angiogenesis and immune suppression. And importantly, a key subset of these tumor-promoting secreted factors are dependent on the MK2 pathway. The next slide shows that in addition to these being dependent on MK2 that phosphorylated and activated MK2 is expressed in tissues associated with both primary breast tumors and in bone metastasis from the same patients. So as pro tumor factors are MK2 dependent and activated MK2 is present in this tumor tissue, it would follow that blocking the MK2 pathway could have anti-tumor activity. So the next slide shows the model that we're currently using to investigate this. And again, this is done at Sheila Steward's lab at Washington University, and we're looking at a mouse breast cancer metastasis model. Approximately 70% of the metastatic breast cancer patients have bone metastasis, resulting in a number of comorbidities, including fracture risk. And we wanted to investigate the impact of MK2 inhibition on breast cancer metastasis, but there's no spontaneous mouse model that exists for this. So instead of tumor cell inter cardiac injection model was used where murine metastatic luciferase transfected breast cancer cell line, o-1 PyMT is used and injected into the left cardiac ventricle and allowed to synchronously deliver tumor cells to the bone and to the visceral organs. The MK2 inhibitors, zunsemetinib or ATI-2231 were administered in chow, starting 1 day after the tumor cell injection. And the data is shown on the next slide. Here, we're looking at whole body bioluminescent imaging carried out 2 weeks after the study start. On the left-hand panel, metastasis observed in both the bone and visceral organs, but treatment with ATI-450 on the right-hand side, reduced both the bone and visceral metastasis dramatically. Histological evaluation of these bone metastases confirmed these bioluminescent imaging results. On the next slide, we extended this to look at the bone integrity in these animals. So in addition to limiting metastasis, as shown on the previous slide and graphically shown on the left, the impact of zunsemetinib on bone integrity is shown on the right. The bone loss is a result of bone metastasis driving increased osteoclastogenesis as well as chemotherapy, which exacerbates bone loss in metastatic patients. The p38/MK2 pathway plays an important role in bone homeostasis through its regulation of [indiscernible] induced osteoclast differentiation. And here, what we're looking at the right-hand side is trabecular bone volume in tumor-bearing mice using micro-CT scanning. And the animals that are tumor bearing but don't have any therapy, the bone integrity is almost completely lost. And so that would be -- it's not shown here, but it would basically be on the x-axis, where the nontumor-bearing mice bone volume is shown in the first set of circles. The next set is looking at paclitaxel, which is a standard chemotherapy, which is used in breast cancer patients, and that does protect somewhat the bone volume. And the last set of bars is zoledronic acid, which is standard of care, bisphosphonate standard of care to protect bone. But interestingly, looking at zunsemetinib, which is a second to last set of symbols, you get protection that's at least as good as the standard of care, zoledronic acid. So the important concept here is that with treatment with zunsemetinib in this model, you'll get a dual level of protection. You can protect against bone metastasis, and you can also protect against bone deterioration. So the next slide shows the data that we've generated, all the data I've shown up to now is data that uses zunsemetinib. And as I said, we're doing some bridging data to 2231, and this shows the bridging data of this breast cancer metastasis model with 2231. So on the left-hand side, we're looking at a comparison of 2231 and ATI-450 in this model, looking at whole body tumor burden at a single dose of 1,000 ppm orally. And you can see ATI-2231 is as good as ATI-450. On the right-hand side, we're looking at a dose response of ATI-2231 in chow, looking at 100, 300 and 1,000 parts per million, and we get clear effects at 300 and 1,000 parts per million. So this just demonstrates that ATI-2231 in this metastatic breast cancer model has activity comparable to that of zunsemetinib. So with this preclinical data, the next slide, we have a plan that's being put in place to investigate ATI-2231 in combination with the chemotherapy standard of care in hormone receptor positive HER2 negative metastatic breast cancer. And the next slide just shows the plan that we have in place. So we plan to have an investigator-initiated study triggered by the scientists at Washington University led by Cynthia Ma. And this is going to be supported by a Department of Defense grant awarded to the investigator. And it will be a Phase I/II study to investigate 2231 in metastatic breast cancer patients. And PK will be evaluated. Safety will be evaluated as will impact on bone turnover and metastasis. And the study protocol is currently being worked out and if the IND submitted by the end of 2022 is allowed, this study should start sometime in 2023. So we'll now transition to some of the data that's been generated in pancreatic cancer from the lab of Kian Lim at Washington University. Next slide. Pancreatic cancer is a major cause of cancer deaths in the world with an overall 5-year survival rate of only about 10%. The standard of care in pancreatic cancer is changing from the chemotherapeutic drug, gemcitabine to a combination drug for FOLFIRINOX, which is a 4-drug cocktail that's demonstrated superior efficacy post resection as shown in this graph. But along with this higher level of efficacy, FOLFIRINOX also has greater toxicity and it induces resistance mechanisms. So based on this profile, any additional agents to overcome this resistance must be well tolerated. One of the FOLFIRINOX components, irinotecan, is the main driver of this stress-induced apoptosis in tumors but also is the driver of resistance. And this effect -- this resistance effect is thought to involve MK2. Therefore, a working hypothesis is that if you add MK2 inhibitor to the FOLFIRINOX regimen, it will improve its activity and reduce toxicity. And so the next slide shows the value proposition for an MK2 inhibitor. So as I mentioned, as FOLFIRINOX is the emerging standard of care in pancreatic cancer, the response rate is only about 30% to 40%. And the duration of the effect is limited due to this resistance induction. And MK2 inhibitor will target a defense mechanism in pancreatic cancer that's incurred by FOLFIRINOX to enhance its antitumor activity as a combination therapy. And if successful, this combo has potential to be utilized in a number of different settings in pancreatic cancer, preoperative setting, postoperative setting as well as metastatic setting. Data generated in this collaboration in Kian Lim's lab that supports this hypothesis has just been published in the current issue of Science Translational Medicine. So the next slide summarizes where we stand with these studies. Irinotecan and its active metabolite SN38 were shown to drive the chemotherapy stress-induced apoptosis in tumors and inhibiting MK2 alters the balance between the cell survival and cell death mechanism and skews it towards the apoptotic cell death pathway, thereby increasing the anti-tumor antitumor activity. So we use the MK2 inhibitor zunsemetinib to test this hypothesis in the gold standard mouse model in pancreatic cancer, the KPPC model. So the KPPC model is an autochthonous, genetically engineered mouse pancreatic cancer model, where mice are genetically changed to include the oncogenic G12D mutation in Kras as well as having mutations in both alleles of p53. And these mutations mimic the human disease and drive the cancer. Autochthonous in this KPPC model is thought to be the best model of human disease progression and also mimics the pancreatic cancer microenvironment. So the next slide is really the key study. The figure on the left is a Kaplan-Meier survival plot in the KPPC mice that were administered vehicle alone, the MK2 inhibitor ATI-450 or zunsemetinib, the modified FOLFIRINOX called FIRINOX, and this just doesn't contain the leucovorin component as that doesn't impact efficacy much and leads to increased rates of cytopenia. And then finally, the combination of ATI-450 or zunsemetinib and FIRINOX. Both ATI-450 and FIRINOX had a positive impact on survival in this challenging model, but the combination significantly enhanced survival over either treatment alone or the vehicle-treated mice. And with this combination, you get almost a doubling in their survival. And this doubling of survival is very unusually and -- unusual in this model. In addition to increasing survival, the evaluation of the pancreas weight in these mice following treatment is shown on the right. And what you can see is you get a decrease in the pancreas weight with either treatment alone, but the combination treatment takes the pancreas weight down to the normal levels. So these exciting preclinical results, along with the safety profile of MK2 inhibitors, provide a foundation on which a clinical study could be planned with the cancer-focused MK2 inhibitor, ATI-2231 for treating pancreatic cancer in combination with FOLFIRINOX. And with that, we're going to transition to another asset that's been put forward from the KINect platform, and I'm going to hand it over to Paul Changelian the Head of Biology.

Thank you, Joe. I want to start by describing a very brief update on our ATI-2138 clinical candidate. This is a dual inhibitor of -- it's an inhibitor of JAK3, ITK and TXK, and that's described on the next slide, which schematically indicates that this single compound inhibits both the T-cell receptor pathway by virtue of inhibiting ITK and TXK and the cytokine pathway by virtue of inhibiting JAK3, which is required for all of the common gamma chain cytokines. What's unique about this approach is that in this single drug, we are inhibiting 2 key pathways required for T-cell activation. And what's particularly important is that the targets for this kinase inhibitor are fairly unique to lymphocytes, unlike other drugs that are used for autoimmune disease like calcineurin, which targets a very widely expressed protein calcineurin. So our hope is that by inhibiting T-cells in this way, we will have a potent effect on activated T-cells in autoimmune disease, but very minimal side effects as a result of its restricted tissue expression. I want to show you just some of the preclinical data that we generated to convince ourselves that we should be looking seriously at this compound in autoimmune disease. And the first slide I'm showing you here is the gold standard arthritis model, the so-called collagen-induced arthritis model or CIA. This study was run at Bolder BioPATH, one of the world's leaders in this area. And the model is run similarly in most labs, animals are immunized against collagen. This induces inflammation in the pause. After about 21 days, they're re-immunized to speed up the inflammation further. We begin dosing at about that time point on day 18, just prior to the second immunization and the animals are continually dosed to day 35, when the animals are taken down. What we do during the course of the study is follow their clinical arthritis score, essentially looking at the swelling and redness and inflammation of the paws. And that's shown in the graph on the left. What you can see in the gray line, which are the vehicle-treated animals, at around day 23 or 24, you see a very rapid increase in the clinical arthritis score. The positive control for this model running in most labs is Enbrel, anti-TNF biologic that's used in patients. You can see a significant inhibition of the clinical arthritis score in these mice. That's significant from the vehicle. What's interesting is that we use 3 different doses of our compound, ATI-2138. In the case of dosing with our compound, the compound is admixed into chow and it was dosed at 3 different levels, 100, 300 and 1,000 parts per million. And you can see that all 3 dose levels of this drug dramatically inhibit the clinical arthritis score relative to vehicle and also relative to Enbrel. On the right, you're looking at the histology of those joints. And this is really the gold standard readout for this model actually showing that your drug has prevented damage to the joint. And you can see in that first bar there for the vehicle, quite a bit of damage is measured histologically. In addition, Enbrel shows a significant inhibition of about 60%. But then for ATI-2138 at all 3 doses, we have a dramatic inhibition of histological damage at over 90%. The other model that we recently explored with this compound to sort of expand our understanding of how it works in autoimmune disease, is the classical T-cell adopter transfer model of colitis. And this is briefly depicted or schematized at the top of the slide, and I'll talk quite a bit more about this in the next section. But essentially, skid mice, animals that do not have their own CD4 cells are adoptively transferred with naive T-cells. These animals then travel throughout the animal -- or these cells travel throughout the animal, causing inflammation at all of the barrier surfaces, both via the colon, the gut, the skin, lungs. What we follow most closely is the inflammation in the colon. And what happens as these animals develop colitis is that they begin to have diarrhea and they have body weight loss because of that. What you can see on the left are the in-life measurements we make, a couple of times a week, we weigh these animals and follow disease progression. Shortly after about 2 weeks post transfer of these T-cells, you start to see all the animals lose body weight. By 4 weeks post transfer, day 28, the animals have lost quite a bit of weight. And at that point, the animals are randomized and placed into different groups. What you can see in the right side of this graph is that animals dosed with 300 parts per million of 2138 in the chow. That's the green line or rapidly increase their body weight up towards the black line, which are naive animals that are not sick at all. That's the normal body weight gain that's observed in these mice. In addition, at the lower dose of 2138 in the red line, the animals stop losing weight and there's a significant increase in body weight as a result. And in the vehicle, of course, in the blue line, you can see continued weight loss. The positive control that we ran in this study is shown in the purple line, that's an antibody to IL-12, IL-23, that's analogous to a drug that's used clinically in IBD patients. The most important readout for this study, and again, I'll talk about this in greater detail in the coming slides, is the histological readout. And that is by taking different portions of the intestines. And here on the right side of the slide, I'm showing you the histological scoring of the ilium. You can see a dramatic damage done in the vehicle-treated animals, some protection in the animals that received the anti-P40 or anti-IL-12/23 and very significant and dramatic inhibition of damage histologically by both doses of 2138. So based on these data, we are very excited to submit and we have submitted an IND to the FDA and it's been accepted. And in a matter of days, actually, we will begin dosing in our SAD study, our single ascending dose in humans. That will begin in December. And we will explore basic parameters such as safety and tolerability, pharmacokinetics. We'll also study pharmacodynamics in the blood at both the T-cell receptor level and the JAK3 level and we'll look at food effects. Interestingly, once we've completed our SAD study over the course of the next several weeks, we will move to a multiple ascending dose study or a MAD study, and we're actually going to do this in patients. And in addition to looking at safety and tolerability and PK and PD, we know from previous studies, in particular, the first study that was done with tofacitinib, the original JAK inhibitor that was done in the MAD study for 2 weeks in psoriatic patients. This is enough time to actually potentially see some efficacy or signs of efficacy. So we're excited about that, but primarily, it's -- the goal of the study is to look at multiple doses over the course of 2 weeks. And as I say, that will start and the single dose version of this will start next week. I want to move on now to a program we've been working on for several years, and we've arrived at a very exciting point in the history of the program, and that is to generate an oral gut-biased JAK inhibitor for inflammatory bowel disease. I'm going to tell you about our 2 development candidates, CDD-2603 and CDD-2676. So as I'm sure this audience knows, most autoimmune diseases are treated with broadly immunosuppressive drugs, whether that's steroids, JAK inhibitors or anti-TNF biologics, but when you do this, you have systemic effects with these drugs, and that leads to things like infections as well as malignancy. As a result of that, people have thought that one of the ways to get around this issue of the systemic side effects of these drugs is to try very hard to deliver these drugs to the site of inflammation. And that's been done in a couple of therapeutic areas, in particular, with inhaled corticosteroids for asthma. And of course, with steroids like budesonide in an animal format for ulcerative colitis, not as common as the inhaled steroids, but certainly is done, and it can generate some efficacy for the patients. As a result of this and as a result of this type of thinking, our approach here is to develop an orally administered molecule that will stay in the gut, minimize systemic exposure but provide patients with the benefit or the convenience of oral dosing as opposed to intravenous dosing, which is required for many of the biologics that are on the market today. So when you think about JAK inhibitors for IBD, there's only one out there. It's Xeljanz or tofacitinib. It was approved for ulcerative colitis. It failed in its trials for Crohn's disease. And it works quite well in these patients who have become refractory to other biological therapies. But of course, it comes with a number of systemic side effects, as I mentioned earlier, infections and malignancy, et cetera. More importantly, just in the last couple of months, the FDA has issued a warning for all JAK inhibitors on the market related to the heart-related events that are seen in these patients, things like heart attacks and stroke, effects on cancer, effects on blood clots. And so as a result of this heightened awareness of the danger of these systemic JAK inhibitors a company by name of Theravance recently proposed the idea of creating another pan-JAK inhibitor similar to tofacitinib that would, in fact, stay in the gut and therefore, not have systemic side effects, but could, in fact, be active in patients who have got inflammation. And one thing I'll point out about their data that we're familiar with so far that's been published, their in vivo activity with their compound, TD-1473 was evaluated in a mouse model, the murine model of damage, the oxazolone model, and this was done with prophylactic dosing. And that's important, and I'll speak to that later when I describe for you how we decided to test our compounds. But to give you a sense of the potency here, what's shown in the table below is the potency of TD-1473 versus tofacitinib across the family of cytokines and JAKs that are used for these cytokines. And what you can see is that these 2 compounds are broadly equivalent their potency. The question became, would they be broadly equivalent in the actual disease setting. So based on the history of tofacitinib and the information that we have gleaned from various documents that have been published by Theravance we designed the following essentially screening strategy to try to make our own gut restricted -- gut-biased compound. Our chemists are wizards. They created some compounds that are very potent against the JAK kinases. They have low-to-moderate permeability so they're not getting out of the gut very easily, they're lipophilic with high rates of efflux and they have moderate metabolic stability such that if they do get out, they're not going to hang around for too long. An important decision we made a couple of years ago was to insist on using what's considered the gold standard model of inflammatory bowel disease in mice. And this is the T-cell adoptive transfer model or TCT, is how I'll refer to it throughout the next few slides. This is the model of colitis. And moreover, in order to claim or believe that we had a compound worth following in addition to the in-life measurements that we made in this model, we demanded that the compound produced histological protection of the gut tissue at the end of the study. What we did is also in all our studies, compare our compounds to tofacitinib and we used tofacitinib in relevant exposures, and I'll show you why we think that's true. And then we looked at multiple doses of 1473 since we really didn't know what dose or exposure was going to be effective for that compound. In addition to demonstrating efficacy and again, the efficacy at the histological level, we also needed to figure out ways to demonstrate effects on systemic immune activity. And this is what we wanted to minimize because we're quite confident that, that's what causes the systemic side effects seen with tofacitinib. And so what we did within the models that we actually looked at the efficacy or the activity in, we looked at exteostimulation of the blood cells to look at signaling of the JAK kinases. We looked at the activation marker status of cells that were transferred in, the CD4 cells that drive the disease. And then, of course, we looked at gut and plasma drug exposure. So I want to just talk a little bit a little more detail about the model and how we settled on running this within the course of the study of all these compounds. As I said on day 0, in the skid mice, naive T-cells are purified from a normal mouse, adoptively transferred into these animals. And in the absence of regulatory T-cells, and that's what you find in the skid mice, they have no regulatory T-cells. The transferred mice react to the microbiome at various barrier surfaces, in particular, the gut. And this induces colitis and weight loss. After 3 weeks, when the animals start losing weight, the animals are put on compound, randomized and put on compound. And again, drug is administered admixed in the chow. And one of the things that this does is it allows us to minimize the handling of the mice. We know from both mouse studies as well as from patients that this type of stress exacerbates the disease. And so what we're looking at here is really the disease caused by the transferred cells and the effect of the drug. On day 49 after 4 weeks of dosing, the study is terminated. Tissues are analyzed for the local as well as systemic effects. We look at plasma levels and we perform histological scoring of both the colon and the ileum and I'll describe that for you in a moment. So for those of you who are not familiar with what a mouse intestine looks like, this is it here. It's adorable, as you can see. Just north of the cecum is the ileum shown at the top, just south of the cecum as the proximal colon and all the way down towards the rectum is the distal colon. At the end of every one of these studies, we cut out a piece of the ileum, a piece of the proximal colon and a piece of the distal colon, and that is handed off to the histologists who then score the tissue. And so for every study that I'm going to show you, we have histological scoring at 3 different locations throughout the intestines of these animals. So I want to go to a little more detail in terms of how we are gauging systemic effects in these animals. What we do is we transfer in these naive T-cells on day 0. Naive T-cells once they enter the animal travel throughout the animal. And as I mentioned, they become activated at various barrier surfaces. After 7 weeks in the animal, a number of these cells have become activated. And we know that by looking using fluorescence-activated cell sorting, at the level of CD25 or the IL-2 receptor on the surface of the CD4 cells. And what you're looking at in the left panel on the left graphic here, is the level of CD25 expression on CD4 cells in the spleen, one of the tissues that CD4 cells travel to and they travel to all the tissues. So you can see that in this particular tissue, the CD4 cells are expressing high levels of CD25 indicative of activation at about 11%. In contrast, on the right, in the same study from animals that were dosed with tofacitinib, which we know is systemic JAK inhibitor where the levels of CD25 are much lower, around 1%. And so this is something we looked at with our compounds as well as a way to assess whether or not systemic activity is being seen. And the other thing we did, which gave us a much more robust signal -- excuse me, is look at activation of the blood. So at the end of these studies, after 4 weeks of dosing, 7 weeks after transfer of CD4 cells, we bleed the animals and stimulate the blood with either with IL-2 and IL-12. And if you look at the top of this figure, the top 2 panels, on the left and the right, what you're looking at is unstimulated blood, which shows very low levels of phospho-STAT5 in that box. In contrast, after you add IL-2 or IL-12, you see very high levels of phospho-STAT5 in response to IL-2, up to close to 60%. This is a measure of the ability of the cytokine to activate the JAK kinases in the blood. And these are from the vehicle-treated animals. And the lower 2 panels, you're looking at the same thing for IL-12 induced signaling and activation of phospho-STAT4. And again, closing in on 60% of the cells have phosphorylated STAT4 in that box that you can see. What you're looking for as a measure of systemic activity or in particular, as a measure of systemic drug levels is a decrease in that level of phospho-STAT5 or phospho-STAT4. And that will be another measure of how we discern whether or not our drug is systemic. So in all of our studies, we looked at our compounds versus a positive control, tofacitinib, again optimized to be commensurate with that dose, which was used clinically. We looked at the Theravance drug candidate, 1473. We looked at our 2 drugs at 2603 and 2676. We ran each compound twice in the TCT model. This is a 7-week model, which requires an additional 4 weeks for histological analysis. In every study we ran, each group has 10 animals and every compound was run at multiple doses. Okay. So now what I'm showing you here are clinical data of tofacitinib from their Phase III trial in ulcerative colitis. And on the left, you're looking at the histological scoring or basically mucosal healing of the patients who are dosed either with placebo on the left or the 2 dose of tofacitinib, 5 and 10 mg BID. Both of those doses are significantly different from placebo in terms of the effect on mucosal healing. The doses themselves were not significantly different. And what's important for purposes of our studies was understanding what the exposure of tofacitinib was in these studies. And if you look at the right, this shows the drug levels of tofacitinib at these doses, at the 10 and the 5 mg BID. And what we did is we looked at these exposures in the blood, the concentrations of tofacitinib in the blood and nanograms per mil and it turns out that the potency in mouse and human blood is analogous or very similar. So we were able to then say, okay, let's use a similar exposure of tofacitinib in the mouse, compare that to our drugs, and that will, therefore, make the comparison relevant. And so what you're looking at here are on the left, the plasma PK from the TCT studies, all the TCT studies in which we studied tofacitinib. And we studied at 2 different doses in the chow, at 180 parts per million or 600 parts per million. And what you're looking at, each symbol on the left is an individual mouse, and that shows the drug level from that mouse at the end of the study. And the dotted lines represent the corresponding dose levels that were used clinically in that Phase III study with tofacitinib. So what you can see is that our lower dose of tofacitinib at 180 parts per million, we are right in the range that was used clinically. If you go over to the right side of this slide now, what I'm showing you is the histological protection seen across the intestinal tract. So I, for ileum, P for proximal colon and D for distal coal and in all cases, the 180 parts per million TOFA dose is superior to the vehicle dose. So essentially, what we've created now is an ability to look at tofacitinib at doses relevant to the clinic and compare those to our compounds. So let me move on to 1473, the Theravance compound Consistent with what Theravance reported, we took this compound and dosed it orally in mice to look at its exposure. And the drug levels were explored in the ileum, which is shown in the red line, in the colon, which is shown in the green line and the plasma, which is in the blue line. And what you can clearly see as Theravance reported is that this is very much a gut-restricted compound, very high levels in the tissues, very low levels in the plasma. What's really unknown here is if the exposures in the gut by themselves are going to be sufficient to treat disease or does one need some level of drug in the periphery. And that's really, to date, an unknown question. And then I'm not going to show you all the data, but basically, all of the parameters that I looked at, that I described for you in terms of what we were going to look at for these models, TD-1473 did not have an effect. So unlike tofacitinib, which prevented weight loss in the TCT model, this did not happen with TD-1473. When we looked in the splenic CD4 cells, which had significantly reduced levels of CD25 with tofacitinib that was not seen with the Theravance compound. When we looked at ex vivo blood assays, dramatic inhibition by tofacitinib, no effect of 1473 and all the PK data from these studies were consistent with those findings. Now the gold standard really or the key data that show you to convince you this compound is not active is, of course, histology. What you're looking at here is the histology in the ileum and distal colon and the proximal colon from 1 of the 2 studies we ran with TD-1473. Again, our positive control was tofacitinib at both 180 and 600 parts per million. It's really the 180 that's most relevant because that's the equivalent to the clinically used dose. And then you can see at the 3 doses that we studied or I guess in this slide, it's just the 2 doses of TD-1473 that we used, 300 and 1,000, there was no significant effect on dosing -- on histological protection. And so to summarize then, what we found and consistent with Theravance's findings was 1473 is primarily a compound that after oral dosing resides in the ileum and the colon with low levels in the plasma, in-life systemic measures of activity were consistent with low levels of plasma. No drug was available. But importantly, and most critical to the furtherance of this compound, there was no evidence of histological activity in the GI tract of these animals across 2 TCT studies. And the question that we are asking, and we hope to find out is if this TCT model is a better predictor of clinical efficacy as opposed to the short-term oxazolone model used by Theravance, these data may have predicted the failure of 1473 in the Phase IIb ulcerative colitis trial that was just released. And importantly, in the last few weeks, Theravance has also announced they've discontinued their Phase II study of this compound in Crohn's disease. So I want to move now to our clinical candidates that we are excited to develop for inflammatory bowel disease. And the first one is 2603. Similar to what I showed you before for the Theravance compound, I'm showing you here on the left after oral dosing of a mouse with this compound, looking at the ileum in the green, and what color is that, purple for the colon and the black dotted line for the plasma. This drug primarily resides in the intestinal tissue of the ileum and the colon and there's very low levels in the plasma. And that's what the compound was designed to do and is doing it very nicely. On the right, just to give you a sense of the potency of this compound, again, this is using the human PBMC assay where we're looking at the key cytokines IL-2, which signaled through JAK1, and through JAK3 and IL-12, which signals through Tyk2 and JAK2. The potency of tofacitinib is compared to 2603. You can see the IL-2 potency is equivalent. And you can see that our potency against IL-12 is quite significantly more potent, and we'll see if that makes a difference. In-life parameters, as I mentioned, is looking at body weight over time. So if you look at the graph on the left, all the way to the left in the left graph is the vehicle group. That's the in the blue. That shows the animals are losing weight over the course of 7 weeks. In contrast, naive mice all the way to the right in the brown. Those are animals that were not given disease. They kept gaining weight. That's the range of weight gain you expect to see in this model. What you can see with the dosing of 2603 across a very large dose range from 30 to 1,000 parts per million. We see a very nice dose-dependent protection of weight loss with this compound. We repeated this using the 2 middle doses, 100 and 300 parts per million. And you can see that equivalent to 180 parts million of tofacitinib we are protecting the animals from weight loss at 300 parts per million. Now this has been predictive of histological benefit, but we have yet to -- I haven't shown you that yet, but this was an exciting finding. And so here's that exciting finding, which is what we demanded of all our compounds, and that is to show histological benefit. The first study we ran is shown on the left. And again, I'm showing you data across the intestinal track ileum, proximal colon, and distal colon and the bars represent vehicle in the blue, and then red is 2603 at 300 parts per million and so forth across that first graph very nice and significant inhibition of histological damage. In the second study, shown on the right side of this slide, again, here, we actually ran tofacitinib at a relevant dose, 180 parts per million. And you can see that the CDD-2603 was equivalent to or better than tofacitinib, again across the intestinal tract, ilium, proximal and distal coal. And finally, we wanted to understand if, in fact, during these studies at which we've shown histological benefit was the drug systemically active. And if you look on the left, we're looking at the levels of CD25 on the CD4 cells that were transferred into these mice in the spleen. And looking at the levels of CD25, a measure of activation. That level of CD25 is inhibited in a dose-dependent manner by tofacitinib on the left, both at 180 and 600 parts per million, minimal effect with 2603. Similarly, in the study, when we looked at the blood taken from these animals at the end of the study and stimulated those cells with IL-2 and looked at phospho-STAT5 in the NK cells in the blood. You can see there's no effect at 300 parts per million of 2603 and tofacitinib, of course, crushes the ability of IL-2 signal. And so the combination of these 2 sets of data gives us great excitement about the compound, histologically protecting damage but not having significant effects in the periphery. I'll move on to our second compound, 2676 as I showed you before, this is the dosing -- oral dosing in a mouse. Green line is the ileum, purple colon, dotted line is plasma. Same sort of thing, the chemist did a marvelous job of creating a compound which would stay in the gut. And similarly, if you look at the potency of this compound in these 2 key cytokine pathways, IL-2 and IL-12, we are either equipotent or more potent of tofacitinib for both of these parameters. Again, looking in-life, at weight loss, you can see a dose-dependent prevention of weight loss by 2676 in 2 studies here of both #1 and #2. But importantly and key, the gold standard here of our histological protection. This is again -- look, I'm just showing you the ileum in this case, we saw this in the colon as well. But basically, you can see dose-dependent protection of histological damage on the left in the ileum. On the right, you can see protection equivalent to tofacitinib at the 180 parts per million dose. And finally, again, looking at the activation of CD4 cells as measured by CD25, 2676 shows less of an effect than tofacitinib. And on the right, where we're looking at IL-2-induced phospho-STAT5, the effect is more pronounced. There's really very little happening in the blood at the end of the study, even though histologically, we showed protection. Both of these compounds have been through 7-day rat dose ranging -- dose range finding studies in rats at very high doses, 30,100 and 300. These doses are all way above the levels that we would expect to need for efficacy. We looked at the drug levels in the gut in the plasma in all these rats. It confirmed what we saw in the mouse. The drug has got biased. The only thing we saw at the highest levels of dosing was, again, consistent with the mechanism of inhibiting JAK3 and JAK1 is lymphoid organs, which were showing decreased weight, both thymus and spleen. The second tox species for this compound will be cynomologous monkeys, we'll be able to look at a number of immunological parameters there because of how close they are to human. And once we have the 7-day study complete, we'll move out of the 28-day studies in both of these species. Okay. So I'd like to summarize the section I just spoke to you about on our gut-biased compound, which we hope to move into clinical development for inflammatory bowel disease. This single slide summarizes essentially everything I've told you in a very compact way which I believe really captures the dichotomy of what we are trying to accomplish. On the left, we're looking at the histological data for all 4 compounds that we studied. Our 2 clinical candidates, 2603 and 2676, we compared that to tofacitinib, and we compared it to 1473. In the blue, I'm showing you the histological data for the ileum, in the red, the proximal colon and the -- in the green, sorry, for the distal colon. And this is all relative to placebo or vehicle. And so essentially, what we're trying to do here with any of these compounds is minimize the histological damage or essentially make those bars go down. What you can see from moving from left to right is that 2603, 2676 and tofacitinib are essentially equivalent in terms of their ability to inhibit histological damage in the ileum, proximal and distal colon. And that's really what we set out to do. What's notable is the data for TD-1473 much less benefit to histological level running around 80% of no drug whatsoever or the vehicle level. If you look at the right side, this was really the goal of this entire program. We knew, of course, from tofacitinib that you could make a JAK inhibitor that would be orally available and effective in inflammatory bowel disease. What we did know is could you make a drug that was going to stay largely in the gut and when you look in the periphery, as we've done in a couple of ways and not have much of an effect. And what I'm sort of showing you on the right is specifically the -- based on the blood taken from the end of these 7-week studies, where the blood is stimulated with IL-2, and we look by fluorescence-activated cell sorting at the levels of phospho-STAT5 natural killer cells in the blood for those very same animals that were used to generate the efficacy. Again, same idea here. The percent relative to the vehicle is shown, the amount of inhibition that you find in a vehicle animal is none because there's no compound there. Similarly, in animals that were dosed to 2603 and 2676, which had histological benefit in the gut, Also, we're not showing any evidence of systemic inhibition of cytokine signaling. In contrast with tofacitinib in 180 parts per million, equivalent to what they use clinically, you see a very significant, essentially a crushing of the ability of IL-2 to signal in the whole blood of those animals. And then not surprisingly, with TD1473, and no effect in the blood, but of course, this compound had no effect anywhere. So it's really the dichotomy between these 2 images, the histological benefit on the left and the lack of obvious systemic effect in the blood, which gives us great excitement and gives us hope that we should further develop these compounds in the clinic and if this model has any predictive value whatsoever, we hope we will see something in patients as well. So what I hope I've convinced you is that we have a couple of gut-biased development candidates that are worthy of moving forward. I've shown you the histological benefit. And I've shown you that within the same models, these compounds do not have a significant effect on ex vivo blood assays or in measurements of splenic CD4 cell activation. We've done toxicology, nothing dramatic was noted. We're waiting on the histopathology and that will be forthcoming. And what we're also going to do and just to remind people, if it wasn't clear from the beginning, we will compare these compounds in a series of studies in normal mice to look at the full complement of immune cells that are found in normal animals, of course, in the skid mice, which are used in the IBD model, they do not have CD4 cells, and we want to be able to look at normal animals as well. So I'll stop there, and I'll hand it off to Dr. Neal Walker.

Thank you, Paul. And now for a few closing remarks before we head to Q&A. So a number of takeaways here today. Hopefully, everybody got a really nice flavor of some of the great science that the team has been working on over the past several months. First, with Zunsemetinib, ATI-450, Phase II programs are on track. We have 3 Phase II studies planned, again, in rheumatoid arthritis, in psoriatic arthritis, which will be P value generating. And then in hidradenitis, where we're looking more at a proof-of-concept study design. We are potentially planning to add 2 additional programs to the ATI-450 larger program. More on that to follow in the coming months, but we do have available capital to add additional programs to that asset. We also have clearly shown through some recent preclinical work, a nice dose-dependent inhibition of IL-17 production I think this opens up again, some more opportunities, perhaps ankylosing spondylitis as an indication. But I think it just reinforces the importance of the MK2 pathway on a number of these cytokines and the team worked hard to produce some of that additional data over the last 2 quarters. In addition, as you probably saw a recent publication in Science Translational Medicine, we're pretty excited about the potential to use MK-2 inhibitors in oncology. We think there's obviously potential in metastatic breast cancer and also pancreatic cancer. And in particular, one of the novel features of our MK2 inhibitors, and it also is quite a potent bone preservation asset. So I think that's obviously important in metastatic breast cancer, where patients often suffer from metastasis to bone. So more on that as we evolve, but we are looking at different routes to start studying these different disorders, and we'll update you accordingly. Certainly, ATI-2231 is exciting. It's an additional MK2 that we developed. As Joe went through, it's got some really interesting properties, and we are currently looking at that particular asset for oncology indications and potentially down the road some orphan I&I indications. And then next, ATI-2138, that's our oral covalent inhibitor of ITJ. IND is allowed. This is our third asset now that's been produced from the platform. So we've been quite productive over the last couple of years. And we're heading into SAD studies, which will start this year. And then the MAD work will begin and read out in 2022. And then finally, hopefully, we are able to show that what we're calling our gut-biased development candidate program for IBD is differentiated from the existing therapy, tofacitinib, which is on the market. At least from a preclinical perspective and also perhaps painted a picture of why others may not have been successful in the space. And so we are gaining some excitement about that program, and we'll be talking about that more in the future. A little bit on our key milestones. Obviously, we've got 3 Phase II studies starting with ATI-450 and those are starting imminently with rheumatoid arthritis starting first, followed by hidradenitis and then psoriatic arthritis in the very beginning portion of next year. We do expect those readouts at least where we currently sit here today. We expect those readouts to occur on a top line basis in the first half of 2023. There might be a possibility to pull forward HS as it's a proof-of-concept study. We're also starting to think a little bit about perhaps an interim look on that study since we aren't really looking at P values there that might be possible and more on that to come as our thinking evolves on that. With ATI-1777, that study will start in the early part of '22. And we would expect top line data on that, at least right now we're planning for the first half of '23. With 2138, as I mentioned before, we just got through the IND process. We'll be starting SAD work in healthy volunteers this month. And then should that be successful, we'll be rolling into a MAD cohort in patients with psoriasis. That will be a 2-week study, and we'll be looking to report that data out in 2022. And then finally, ATI-2231, which is our MK2 inhibitor that we're looking at potentially for oncology indications. We're right now in the throes of IND-enabling tox work. and we would look to have that into an IND in Q4 in '22. So that's what our catalyst calendar looks like over the coming months. And as a reminder, as of our last reporting date, our cash balance takes us to the end of '24. So thank you for your attention today. I hope we're able to answer a lot of questions in terms of the science that we've been working on over the last several months. And I'll now open it up to Q&A. Thank you.

[Operator Instructions] Our first question comes from Louise Chen with Cantor.

This is Carvey, in for Louise with 2 questions. Over a little bit about everything. So first of all, in molecular level for your MK2 inhibitors, how does ATI-2231 differ from ATI-450 in addition to the longer half-life which will lead to longer exposure. With side effects or toxicity be greater than ATI-450 as a result. Secondly, this is on ATI-2138. Given the existing animal mono data, which type of severity for psoriasis patients is that most benefit, are we talking about mild-to-moderate, moderate-to-severe. What are your thoughts on how we fit into treatment paradigm? And lastly, on your gut-biased checks. Just curious to know when you might CDD-2603 and/or CDD-2676 into clinic.

Thank you for the questions, everyone. This is Neal. I'll start with your second question relative to 2138. I think for something like psoriasis, I think, you want to be in the moderate-to-severe end of the spectrum. And so that's what we would be targeting. We're also looking at a variety of other indications there, things like inflammatory bowel disease and some others. We haven't fully completed down selecting to indications. And it's a pretty potent molecule. It's -- we liken it to cyclosporin but a little bit more specific. So that's our current thinking on that molecule and that will be updated as we get through our kind of SAD and MAD work and the side work starts this month. For your first question on the 2231, let me hand that off to Joe to answer that.

Yes. Thanks, Neal. Yes, so the molecular differentiation of 2231 versus zunsemetinib from a structural standpoint, the 2 compounds are very close to one another. So from a -- just a chemistry standpoint, we don't see much differentiation. As you mentioned, from a PK standpoint, we do have a longer half-life, lower clearance. From a pharmacology standpoint, they're very similar as far as their potency goes on various enzyme cellular in vivo studies. The concern about the longer half-life and increased exposure resulting in higher potential toxicities. The way we approach clinical studies will be to look at doses, exposures and pharmacodynamic measurements and to sort of have the pharmacodynamic analysis guide the doses that we will move forward with 2231, both from a dosing level as well as dosing interval. So we don't anticipate having any issues there. Zunsemetinib is proven to be in the studies we've done thus far, very safe. And we would take the same approach with 2231.

Yes. I think I'll take the last question. The gut-biased work that we've done thus far, as you can tell, Paul and team have been working really hard on I think taking the ground some of the controversies out there, whether it's -- there seems to be a camp that thinks that perhaps you can go quite selective and drive meaningful efficacy. And I think maybe we've seen some of the shortcomings of that approach. Then there's the other camp that feels you have to be systemic. I think we kind of believe you have to be somewhere in the middle. And I think we've started to build that case to release some of the preclinical models. In terms of moving forward with it, certainly, the next step is to down select. We've got 2 dev candidates. And as Paul mentioned, we're doing a little bit of additional work just to choose kind of the lead molecule. They're very similar in a lot of ways. And then it's just doing IND-enabling tox work. And so I think one of the things we're cognizant of is just kind of the evolving landscape with JAK inhibitors in general. So we'll certainly continue to give that some thought. We just recently saw the new updates for the RINVOQ label. And as we've stated a number of times for assets like this, we certainly have a lot to work on in the portfolio. And certainly, would look to potentially look at partnerships as well for something in the IBD space. So a little bit of extra work to do there and also a little bit of triangulating with how the market continues to evolve relative to JAK inhibitors.

Congrats on the progress.

Our next question comes from Tim Lugo with William Blair.

This is Lachlan on for Tim. I guess, first on ATI-2231. I understand the PK advantage there of 450, but are there other important advantages that make you prefer it over 450 in oncology? Or is that more of a kind of portfolio planning decision? And then second, on the gut-biased molecules. Sorry if I missed it or just haven't connected the dots yet, but do you understand why your compounds are showing activity when Theravance [indiscernible] despite having a sort of relatively similar tissue-to-plasma PK profile? Is it just slight differences there? Or is there some other factor that I'm missing?

So let me start out with your question on 2231. I think there is a component of kind of lifecycle management there. We have an IP window on that extends 7 years past. And we're looking at 450 as a good asset for a variety of immuno-inflammatory indications and then perhaps looking at 2231 for some oncology indications, which is a little bit different landscape. We don't rule out looking at 2231 for also some immuno-inflammatory indications, is just as we were kind of looking at this whole landscape and some of the data was evolving, you saw the recent publication in pancreatic cancer. We just thought it might be good to differentiate the assets according to indication. I'll hand off the molecular question to Joe, again, if he has any additional comments and then maybe Paul, Joe you can hand to Paul and answer the question on the gut-biased front.

Yes, I think you covered it, Neal. I think from a molecular standpoint, when we looked across all the different analysis that we've done, the 2 compounds are really changeable, the zunsemetinib and the 2231. So it's more of a strategic decision on putting the assets into the various therapeutic areas and Paul with the gut-biased?

Great question on Theravance. So a couple of things. The TD-1473 is actually when you look at those initial gut PK studies, it indeed is gut selective, but it's metabolically less stable than our compounds, number one. So it doesn't survive as long. And moreover, to sort of make a direct comparison within the context of our mouse models, we looked at activity of these compounds in mouse whole blood. And the Theravance compound is anywhere from 5 to 10x less potent than our 2 compounds and tofacitinib, in particular, when you look at its potency against IL-12 in a whole blood setting, which, of course, encapsulates protein binding, which is important for an in vivo analysis. So those are the 2 things that we think are most unique about it and that led to its problems. And the third thing, of course, I think, is the model that they chose to base this on the short-term oxazolone model is not particularly predictive based on what we've seen in the literature and what we've seen in our own studies.

Our next question comes from Thomas Smith with SVB Leerink.

A couple on zunsemetinib and the Phase II plans. Can you talk a little bit more about how you're thinking about dosing here? I know you mentioned hitting the IC80 with the 50 mg BID dose. But you've also looked at doses up to 120 mg BID. I'm just wondering whether there's any additional dose-ranging plans either in these studies or perhaps in some of the additional programs you're contemplating, any potential for once-daily dosing?

Yes, Tom. So certainly, on the once-daily dosing, we've been pretty clear on that, and that will become part of the program as we talk about more studies. As we looked at the 50 milligrams BID, clearly, we've talked a lot about the fact that we're hitting multiples of the IC80 and we're hitting the target pretty hard. And I think when you look at the IL-17 work that Joe just went over. It's a very similar pattern as we saw with TNF, IL-1, and so we're hitting multiple cytokines that multiples of the IC80. And so it's really knocking the target down. And I think -- so that's kind of the main consideration. I think some of the other minor considerations are just seeing -- if you remember our SAD and MAD data, although they were mild-to-moderate, we saw increase in some of the mild AEs as we dose escalated at 80 and 120 in the MAD cohort extension. And we've recently conducted some DDI studies where we saw kind of a similar pattern to what we saw in the MAD studies with 80 and transient dizziness, some skin findings, some transient headache and some upper respiratory infection findings, things like that, no SAEs or serious AEs, but as we thought more about it, we feel that 50 is hitting it hard enough. Certainly, it doesn't preclude us from going increasing the dose on an indication-specific basis, and we're still contemplating that. As I mentioned in our -- in my prepared remarks, we are looking at adding in a couple of indications. And at the end of the day, our job is to find the minimally effective dose, we actually -- and maybe I'll let Joe comment on this. We've actually found, when we look back at the data, 20 and 30 some pretty potent cytokine suppression. Maybe, Joe, you just make a comment on that?

Yes. So in the SAD MAD studies, we did 10, 30, 50, 80, 120, so we're going forward with the 20-milligram dose in the RA IIb study. And even at the 20, as Neal said, we're projected to inhibit TNF and IL-1 beta by 70% to 80% at peak and 50% to 65% of trough. And so this suggests to us that the 20-milligram BID dose is probably going to be a pharmacologically active dose in addition to what we see at the 50%, which, as you mentioned, we're seeing multiples of ICA [ trough ] and knocking down TNF by 92% to 93%.

Okay. And then yes, I thought a really interesting data for zunsemetinib looking at the impact on IL-17. We know a competitor just recently presented some data at ACR and they've been particularly focused on the IL-17 impact. Can you just help put your data in context with the Bristol data, your thoughts on zunsemetinib and 2231 compare?

Joe, why don't you handle that one?

Yes so, the Bristol compound described inhibition of IL-17 production with a maximum inhibition of the neighborhood of about 70% and -- 60% to 70%. We're seeing similar inhibition with zunsemetinib on IL-17 production, albeit our compound is more potent in regulating that. But secondly, we also, as I mentioned, saw impact on IL-17 signaling through its receptor with zunsemetinib, again, blocking in a low nanomolar level production of cytokines driven by IL-17. We don't believe that we haven't seen any data where the BMS compound looked at IL-17 signaling. And so just putting it in perspective, we just feel like this adds another key inflammatory cytokine that is regulated by MK2 and dependent on MK2 for activity in addition to the TNF, IL-1, IL-6, et cetera, and just adds to the possibilities, both around the indications that we're interested in as far as mechanistic validation as well as additional indications, as Neal mentioned earlier.

Okay. Great. Yes, that's helpful. And then just a clarifying question on the ICJ inhibitor 2138. Can you just clarify how you're thinking about the cadence of the updates here? Should we expect an announcement with the healthy volunteer SAD data? Or are you planning to move this directly into psoriasis patients and generate potential proof of concept before announcing the top line results.

I think at this point, we're likely to announce some top line on the SAD portion just so we indicate some clarity around the pharmacodynamics and the dose. I think that would be valuable information. And then the MAD, obviously, we'll be doing that in patients. So I think the remit there would switch a little bit in terms of just showing potentially some efficacy or some early efficacy in addition to some pharmacodynamics. So we kind of look at those as -- just because one is in healthy volunteers, the other is in patients is a little separate. So I think I would expect at this time, at least an announcement on the SAD to show that we're making some progress and then move on to the MAD.

Our next question comes from Chris Raymond with Piper Sandler.

A couple for me. Just on the 3 Phase II studies for 450, I think, Neal, I think I heard you say HS might be the earlier of the 3 and I think I heard you say there was an interim look in maybe next year. Can you just maybe clarify timing for the other 2 studies, is there a timeframe for an interim look? And would that be in 2022? And then maybe just a question on something you didn't really talk much about is 1777 million, just noticing you guys didn't really provide any update on the clinical trial design for the next clinical work. Maybe when should we get more granularity on that design?

So let me answer both of those for you. You're right. I mean there's only so much we could put into this debt, but I can give you that update now. So a couple of things. So our -- the study starts are imminent. RA is going to happen first. HS will happen within like a week or 2 after and RA -- and by the way, I didn't provide this color either. RA is in 51 sites, 12 of those are in the U.S. And then HS is 20 sites that will be all U.S.-based. And then psoriatic arthritis will be the study started in the earlier part of '22. And that's 20 sites, and that's U.S. and in Poland where those sites will be located. So that's kind of the cadence. We're not going to be doing any interim looks on either RA or psoriatic arthritis. Those are P value generating studies. It's tough to take a hit on that. When you do an interim look, I think it makes sense just to run those to ground and report the top line data. HS, we are looking at that as proof of concept. I mentioned a little bit different primary endpoint. We feel it's important to prove out the acute inflammatory aspect. We'll certainly look at the regulatory end points too, but I think as many on this phone call know, HS studies can be a little difficult. And I think it would be important to perhaps look at an interim look as a way to pull some data for it and also make sure you're on the right track. So we haven't finalized plans on that. That's something we're contemplating. But I do think HS probably has the best shot just given that it's more POC in nature of reading out first. On 1777, some thoughts on the trial design there. So we're looking at, I think, it's about a 5-arm study. So we're doing the top dose, which is 2%. That's the highest we could get in that formulation. That's BID, and they're also going to look at 2% QD. And then -- because we do believe that there's a chance for QD dosing. We also will look at a lower concentration 0.5% is, I think, what we'll be looking at, and that will be BID and then, of course, the placebo arm. So we're trying to check a number of boxes here, looking at both QD and BID dosing. Obviously, QD has a better, more advantageous profile than BID? And then also, it's always important in atopic derm topical studies to look at a lower dose particularly when you start treating younger patients and also treating potentially more sensitive areas like the face. So that's our thinking, and that will kick off early next year in 2022, first half, and we anticipate that data as well in first half of '23.

Our next question comes from Roger Song with Jefferies.

Great. So a couple from us. So first one is so still the 450, you have 3 Phase II and the 2 of them are P value generating, I don't know if you can provide some kind of high-level powering assumptions for those trials, that would be helpful. And given the hidradenitis, not P value generating. So how do you think about the go and no-go decision criteria for the Phase II readout?

Yes. So we are -- the psoriatic arthritis study is powered at north of, I think, 83%, is where we had that and RA -- or sorry, RA is also in the 85-plus percent range. So similar powering assumptions there and obviously just use some other comps to look at that. With HS, can you just repeat that question? I missed that last part.

Yes, it's not P value generating, it's not powered, but how do you make the go or no-go decision for that indication?

Yes. I think what we really want to see there is, number one, quite frankly, we want to make sure that the way we've designed it that we've learned from others who perhaps didn't drive responses due to clinical study design. So I think that's kind of one piece. I think from my perspective, what I really want to see is this is a disease that is certainly in its acute form is characterized by a lot of inflammation. So that's why we're measuring a mean change from baseline in acute inflammatory nodule and abscess reduction. If you drive positive effects there, then the tunnel formation and fibrotic changes that are more long term. You can imagine if you get a lot of puss in an area you're going to start getting fibrotic changes eventually because it's a constant inflammatory cycling on and off process. And so if we can show that we're driving a strong result on that primary. And if we're right about the mechanism, we should, then that to me is the go decision because in my mind, if I can get rid of the inflammation, certainly characteristics of the molecule of 450 in general, the antifibrotic nature of it, the IL-1 beta nature, which really becomes more important in the later stages of hidradenitis I'm very confident in that working and then it's just powering it appropriately to check the boxes on the regulatory endpoints. But it's something I've talked with investors about and also you guys on the sell side is that I really like HS as an indication the one part that just worries me sometimes is just thinking about the vagaries of the clinical study. So I think our effort here is to show that we're right about the mechanism. And I think if we can show potent reduction of the acute inflammation, that would be the go decision.

Got it. And then for 2231. So since this MK2 HSP27 active is the pathway for the resistant mechanism of the MK2 activation. If I remember correctly, 450 actually has some kind of low affinity for that complex versus the p38 alpha MK2. Maybe just can you provide some kind of color around the 2231, what's the affinity for that particular complex with MK2 HSP27. Is that higher than 450 and you potentially this is a better compound for the oncology versus the 450.

Joe, do you want to take that?

Yes, I could take that. So with respect to the mechanism in the oncology setting, particularly pancreatic cancer setting, you're correct in that. The thought is that to try to skew the downstream effects to more of an apoptotic effect for the chemotherapeutic you'd want to block HSP27 phosphorylation, and that will just decrease the negative impact that would have on the apoptotic mechanism. And you'd also want to decrease the phosphorylation of another downstream substrate Beclin 1, which would have an impact on the autophagy and the survival mechanism. Now as far as mechanistically or molecularly, what's happening with 2231 versus 450 and the affinity of the complexes, both our 2231 and zunsemetinib bind tightly to the P30 and MK2 complex lock MK2 into an inactive confirmation and prevent MK2 from phosphorylating HSP27 or Beclin 1. And the affinity of either of these 2, zunsemetinib or 2231 for the MK2 HSP27 complex is low. But in our opinion, that's irrelevant in that, the key is to block the phosphorylation of these downstream substrates that are involved in both inflammation as well as the resistance mechanisms in cancer. And by blocking the p38 MK2 complex and not allowing MK2 to be activated, that will just stop MK2 from performing its function of phosphorylating the downstream substrates.

Got it. Okay. That's very helpful. All right. And then maybe just one last one from us is the for the TOFA, the JAK inhibitor, maybe just tell us a little bit about the -- what is the targeted product profile in terms of the efficacy safety given you have limited systemic exposure, but high local and the potential kind of histological impact because we know that TOFA has the black box warning and just in terms of the clinical profile, how are you going to differentiate with the TOFA?

Yes. I think let me start out and then maybe hand it to Paul to fill in the blanks. I mean I think that -- the black box issue is certainly an overhang, right, in the space. I mean we saw, like I said earlier, RINVOQ get some maybe a little bit water down language. Maybe there's a lot more narratives to play out. But I think the thrust of the data, at least preclinically that Paul was trying to share and look, we got to do the work. We've got to see if that's validated in the clinic. But I think what he was demonstrating there is that if one can design a drug that gets efficacy that starts -- or activity that starts to get right in the ballpark, if not better than TOFA yet not have nearly the same systemic exposure as TOFA then I think you have something there. And in particular, disease like IBD where there's a lot of unmet need. So I think that's the way we think about it. I think the conclusion we've come to is that if you're too gut selective, you're just not going to drive an appropriate level of efficacy so that you need some systemic exposure. So at the end of the day, it's kind of the same argument that we have for our topical soft jack that if you take a PK driven approach and you say, hey, if I'm driving really nice efficacy or activity in the skin, yet I can have a pretty minimal PK exposure and if that actually matters in the grand scheme of things relative to just label considerations down the road, which is something that we don't know yet then that's where you want to be. I mean any targeted approach, I think, is going to be a better place to be than just more systemic. And Paul, maybe you want to fill in some blanks there?

Sure. Thanks for the question. Fortuitously, just in the last few weeks, there was a very nice review in Lancet Gastroenterology. Comparing all of the available IBD drugs, both small molecule and biologics. And what they did essentially was sort of compare efficacy in AEs. And the drug that comes out on top in their analysis, and I think we would agree, is RINVOQ. Efficacy is excellent, but it also comes out on top in terms of its side effect profile. And so I think that is the place we would like to position our compound. I think if this logical efficacy in preclinical models, if our toxicology and cynomolgus monkeys, and if our early clinical data indicates we're having some activity, but we're not seeing the signs of that, that would be consistent with systemic immune suppression, then we would be very excited and I think would be hopeful. But clearly, when you look at this most recent review, the drugs that work the best have the worst AEs. That's just consistent across all these compounds and all these biologics, and we're trying to provide, as Neal mentioned, efficacy that approaches those compounds, but minimizes the side effect profile, which is obviously a concern for these patients.

[Operator Instructions] Our next question comes from Ram Selvaraju with H.C. Wainwright.

This is Boobalan dialing in for Ram Selvaraju. Can you hear me okay?

Yes. Yes.

Okay. A couple of questions from our end. So firstly, with respect to ADI 450 for RA, assuming your Phase IIb produced positive data, do you intend to execute Phase III study on your own? Or will it involve partnership?

I think if the data comes out, how we hope and expect, I've been pretty consistent with this. I mean you always have to plan to go it alone, but I do think it's wise to look at partnership opportunities with an indication like this. It can be rather ambitious going after a large indication like RA. And I think the clinical program, as I've mentioned in the past, is not just kind of single threaded. I mean the study we're talking about here is on study off a couple we're contemplating in the RA space. We've talked in the past about potentially looking at monotherapy for earlier disease, and we're trying to think about now what that broader programmatic approach is. And I think as you start talking about breadth in a clinical program, I think obviously, cost goes up and complexity goes up. So I think if the data comes out, how we hope and expect, we would be very interested in looking at a larger partner.

So with respect to your HS trial, can you frame the market opportunity in HS for ADI 450? And in your view, what would be the ideal attributes of an HS drug?

Well, I think clearly, we -- self-serving, I guess, but we think an oral approach makes sense. We've seen some of the data with the biologics. And I think as we often see in a lot of these markets, as the epidemiology and the pathophysiology of these diseases gets better understood. You see more and more interest in the space. We do think going after an oral approach makes a lot of sense, patients prefer that. something where if you're dosing either BID or QD, I think would be advantageous to an injectable. The other aspect is just like as we talked before, and I think, hopefully, we've highlighted here today is we have a molecule that takes out a number of legs of the stool. And we're not single threaded, just going after TNF as an example. We hit a number of the cytokines that are key to the disease and one of the things that I like about this molecule is the potential to hopefully intervene earlier because like I alluded to before, often you don't catch these patients until they have quite a bit of fibrotic change, quite a bit of tunnel formation. If you can catch them in the acute inflammatory stage a little earlier, then you don't get -- you don't have to get a patient that suffers through all of that kind of recalcitrant disease. So to me, the ideal compound would be something oral, something that addresses the spectrum of disease, which 450 certainly does as it relates to HS. And I think there's also an opportunity to try to migrate a little bit earlier here as well. I mean there's always reimbursement headwinds when you make a statement like I just made where we try to -- we have a desire to migrate earlier in the disease, but we're talking about not getting on the market for a number of years. I think a lot of those things can change and good data can help change that. So that's the way we think about it.

Okay. With respect to ATI-1777 for atopic dermatitis, will your future Phase IIb study involved pediatric patients? Firstly. And secondly, so you used a modified EASI score at week 4 as our primary endpoint in our Phase IIa. So do you anticipate studying the drug a little bit longer in your Phase IIb study, say, like week 16 given some competitors have used this time period for their investigational drugs?

Yes. I don't -- so right now, we're in the throes of looking at the lower bound of -- we've sent some correspondence in to the agency to see if we can get down to, I believe, 12-year-olds. I don't think we'll be looking at anything -- any ages lower than that. Relative to -- what was your -- sorry, I'm blanking on the second part of your question. Can you ask the second part?

Yes, yes, yes. Absolutely. So you looked at EASI score at week 4 as your primary endpoint in your Phase IIa. So do you anticipate studying the drug a little longer for your Phase IIb, say week 16.

I have been a firm -- in the IIb, we're going to do 4 weeks. So I've been a firm believer that if you are just having lived in this space as a practicing derm, I'm kind of a firm believer that it's important in the disease that where you're treating the flare that you show something robust at 4 weeks. I'm well aware of the other companies and assets that look at 16-week endpoints. They're a little bit different when you're talking about administering a biologic, sometimes it takes a little bit longer for that to show the effect you'd like or the peak effect. But I think we're showing a nice effect and nice activity at -- thus far at 4 weeks. We do have the ability to look longer, as in every AD trial, you have to do an open-label safety study. So in that respect, we can pick up additional data that shows what that curve looks like as you treat longer, but I'm a firm believer that 4 weeks is the key in this indication.

I am not showing any further questions at this time. I would now like to turn the call back over to Neal Walker for any further remarks.

Well, I want to thank everybody for joining us here today. Really appreciate the questions. And as you can see, I think the team has been working really hard. All credit to the folks in St. Louis and Wayne for driving hard all year through some pretty challenging times during the pandemic. I think hopefully, what we've been able to convey is that we have a real platform here and that platform consists of not only our kind of tangible asset in the proprietary chemical library but also the intangible asset or maybe more tangible than we believe, which is the people. And we have a great team that is able to work through, looking at these molecules in interesting ways. And hopefully, the data you saw in IL-17 was yet another example of that. We're proud of the work that we've been able to generate thus far, and we look forward to continue to drive shareholder value over the coming years. So thanks, everybody, for attending.

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.