Altimmune, Inc. (ALT) Earnings Call Transcript & Summary

Greetings, and welcome to this morning's conference call hosted by Altimmune. [Operator Instructions] It is now my pleasure to introduce your host for today's call, Will Brown, Chief Financial Officer, Altimmune. Will, you may begin.

Thank you, operator, and good morning, everyone. Thank you for joining us. Members of the Altimmune team joining me on the call today are Vipin Garg, Chief Executive Officer; Scott Harris, Chief Medical Officer; and Scot Roberts, Chief Scientific Officer. Please note that we issued a press release and an accompanying slide deck this morning, which is the subject of our discussion today. You may find copies of these items on the IR section of our website. Before we begin, I would like to remind everyone the remarks and future expectations, plans and prospects constitute forward-looking statements for purposes of safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Altimmune cautions that these forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated, including those related to COVID-19 and its impact on our business operations, clinical trials and results of operations. For a discussion of some of the risks and factors that could affect the company's future results, please see the risk factors and other cautionary statements contained in the company's filings with the SEC. Any statements made on this conference call speak only as of today's date, Tuesday, September 28, 2021, and the company does not undertake any obligation to update any of these forward-looking statements to reflect events or circumstances that occur on or after today's date. As a reminder, this conference call is being recorded and will be available for audio replay on Altimmune's website. With that, I will now turn the call over to Dr. Vipin Garg to begin today's call.

Thank you, Will. Good morning, everyone, and thank you for joining us today as we review the positive Phase I, 12-week clinical data for our GLP-1/glucagon dual receptor agonist on the development for obesity and NASH. These study results were announced in a press release and an accompanying slide deck this morning. To begin, we are excited to share the proposed nonproprietary name for ALT-801, pemvidutide. Going forward, we will be referring to the compound by this name and hope to receive the efficient approval for the name pemvidutide sometime next year. As you will see, we believe the Phase I clinical data we have collected is compelling with our best-performing cohort of subjects achieving weight loss of greater than 10% in just 12 weeks. That is an average weight loss of nearly 20 pounds in this study. Furthermore, patients experienced primarily mild GI effects and there were no study discontinuations due to adverse events. These results, obtained without the use of dose titration, fuel our enthusiasm for the potential impact pemvi could have on the multibillion-dollar obesity and NASH marketplace. Progress in our obesity and NASH programs is moving swiftly. With this report of the Phase I study results, the recent FDA clearance of our IND for NASH and the anticipated filing of an IND in obesity later this year. As Scott Harris will discuss, we have robust development plans in place that we expect will allow this program to expeditiously move forward. We look forward with great anticipation to our Phase II obesity trial, which will study the effect of pemvi when dosed for up to 1 year. We saw no decrease or leveling off in weight loss during this 12-week study. And recall that in our animal experiments, weight loss only ceased once animals return to their lean normal body weight. So far, our animal models have been good predictor of pemvi's effect in humans, and we hope to see that relationship maintained in our longer-term studies. A noninvasive and well-tolerated therapy that elicits weight loss approaching bariatric surgery would change the paradigm for doctors and health care providers in the midst of the worldwide epidemic of obesity. I will now turn the call over to Dr. Scott Harris, our Chief Medical Officer, who will review the 12-week Phase I clinical data. Scott?

Thank you, Vipin, and good morning, everyone. First, let me share how thrilled I am that we are able to achieve double-digit weight loss with good tolerability in the 1.8-milligram dose arm of the Phase I trial without the use of dose titration. Not only was the mean weight loss greater than 10%, but we also saw the majority of subjects at the 1.8-milligram dose achieved greater than 10% loss of body weight. Regarding safety and tolerability, there were no adverse events-related study discontinuations and only mild or moderate events noted. The results we shared this morning are from our 12-week Phase I placebo-controlled single and multiple ascending dose study of pemvidutide. The study was conducted in Australia under a clinical trial application and enrolled healthy, but overweight and obese volunteers. The study did not employ caloric restriction or other behavioral weight loss programs and, importantly, did not employ dose titration. A stepwise dosing mechanism that gradually increases the dose over months before reaching the intended therapeutic dose. Dose titration is typically used with drugs in the GLP-1 class to ameliorate the incidence of severity of GI side effects, but we were able to achieve acceptable tolerability with pemvi in the study without using dose titration. The purpose of the SAD phase of the study was to find the appropriate dosages to carry forward to the MAD portion of the study and consisted of 36 subjects receiving single doses from 0.4 milligrams to 4.8 milligrams. We carry forward the findings of this stage to enroll 3 cohorts in the MAPD (sic) [ MAD ] portion at doses of 1.2, 1.8 and 2.4 milligrams randomized 4:1 to drug or placebo. Subjects received 1 weekly subcutaneous doses for 12 weeks with subjects staying in the unit for the first and last week of the trial. The primary objectives of this Phase I study were safety and tolerability, pharmacokinetics and weight loss. We have also included this presentation. In this presentation the data on blood pressure, heart rate, glucose control, including hemoglobin A1c levels; HOMA-IR, a measure of insulin resistance; and lipids. Additionally, we have provided data on ketone bodies, a measure of glucagon engagement. We have provided the baseline demographics of the MAD cohorts, for your information, noting the mean age, sex, race, body weight and BMI of the treatment groups. Importantly, we observed no correlation between the amount of weight loss and age or baseline BMI. Subjects receiving a 1.8 milligram subcutaneous, once-weekly dose achieved an absolute mean weight loss of 10.3% in 12 weeks of treatment with pemvidutide. At a lower dose of 1.2 milligram, subjects achieved an absolute mean weight loss of 4.9% at week 12 and at the highest dose of 2.4 milligrams, we saw a weight loss of 9%. The amount of weight loss at the 1.8 and 2.4 milligram doses are essentially the same, given the sample size and overlapping confidence intervals. So higher doses than 1.8 milligrams may not promote additional weight loss over 12 weeks. We have provided the individual weight loss curves on Slides 8 and 9 of the presentation and we are excited to see a consistent rate of weight loss over the 12 weeks. At the 1.8-milligram dose, an impressive 55% of subjects achieved at least 10% weight loss at week 12 and 100% of subjects achieved at least 5% weight loss. We also note the mean weight loss at 12 weeks is almost double the amount reported at 6 weeks, 10.3% versus 5.4%. We are encouraged that this rate of weight loss could continue beyond 12 weeks. Importantly, pemvidutide was well-tolerated in the trial even in the absence of dose titration with no adverse events leading to discontinuations and predominantly mild adverse events that did not require treatment at the 1.8-milligram dose. At the 1.8-milligram dose, we saw very low instances of vomiting and constipation with no reports of diarrhea. These events resolved while dosing continued. The absence of diarrhea is important, as diarrhea has been cited as one of the most frequent causes of study discontinuation. While the weight loss was similar at the 2.4 milligram dose, we saw an increase in the incidence and severity of GI adverse events. And therefore, we see 1.8 milligrams as the foundation for further dose evaluations in our upcoming studies based on the balance of weight loss and tolerability. It is especially encouraging that we experienced no dropouts or withdrawals during the 12-week trial for any reason at the 1.8-milligram dose, our best-performing dose. Subjective patient-reported outcomes and reported variability across studies in different phases of development are notoriously difficult to compare, and we believe that the most telling indicator of a patient's acceptance of a medical intervention is the dropout rate. While patients are rapidly losing this weight, in this case, in the case of our Phase I trial, nearly 20 pounds in only 12 weeks, they become highly motivated to maintain treatment and could even assume lifestyle changes that promote further weight loss. Favorable trends were also observed in secondary measures, including a 28% decrease in total and LDL cholesterol and a 38% decrease in triglycerides. Coincident with these changes, we observed an increase in ketone bodies, supportive of glucagon's effect on fat metabolism. It should be stressed that these changes occurred in only 12 weeks. Glucose homeostasis, as assessed by fasting glucose and hemoglobin A1c, was maintained. A trend towards a reduction in HOMA-IR, an accepted measure of insulin resistance, was also noted. Systolic and diastolic blood pressures also decreased despite the absence of significant increases in heart rate. Regarding our near-term development plans for pemvi, we are pleased to have received clearance of our U.S. IND for NASH, are in the process of initiating a 12-week Phase Ib study of subjects with nonalcoholic liver disease or NAFLD in the United States. This study will expand the enrollment criteria used in the Phase I study in Australia to include diabetic and older subjects and should commence in the near future. The primary readout from this study will be reduction in liver fat by MRI-PDFF. We have also initiated a drug-drug interaction trial to look for any interactions that could arise between pemvi and drugs that could be affected by changes in gastric emptying. Drug-drug interaction studies have been performed routinely with GLP-1 agonist and have not typically shown such interactions. Finally, we are planning to initiate a trial in type 2 diabetes in the fourth quarter of this year to study the effects of pemvi on glucose management in this population. We anticipate the top line data from the NAFLD drug interaction in diabetes trials will occur in the first half of next year. We anticipate that these trials will allow us to begin 2 Phase II studies, 1 in obesity and 1 in NASH. We plan to file the obesity IND shortly now that the pemvidutide IND for NASH has been accepted. The Phase II obesity trial will dose subjects for up to 1 year with a planned 24-week interim analysis occurring late next year. The NASH trial will be a 52-week biopsy-driven Phase II trial, which we expect to initiate in the first half of 2022. We anticipate that trial to read out in 2023. We are also considering the possibility of an extension study to our soon-to-commence NAFLD study that would allow more extended administration and an earlier look at 24-week weight loss. I will now turn it back over to Vipin for his closing remarks. Vipin?

Thank you for that overview, Scott. Rapid double-digit weight loss in 12 weeks, no adverse events-related dropouts and the lack of dose titration are compelling potential advantages of pemvidutide. And we have an exciting opportunity to carry forward a potentially highly differentiated therapeutic agent in the metabolic space. We are especially pleased to have the opportunity to share these data with you today, and we look forward to additional data readouts and to advancing pemvidutide in a comprehensive clinical development program in NASH and obesity. Operator, that concludes my formal remarks this morning. Could you please instruct the audience on the Q&A procedure?

[Operator Instructions] Our first question comes from Seamus Fernandez with Guggenheim.

Great. Thanks for the question. So maybe just to -- first off, congratulations on double-digit weight loss. I think this is something that, clearly, we haven't seen with any of the other dual incretin so far and certainly not at 12 weeks. So congratulations on achieving those metrics. Maybe just to kind of get the one controversy that's out there is this single patient with the ALT elevation. Can you guys talk about the characteristics of this patient? It says in the press release that the patient was paused on treatment, and that's also included in your slide deck. So I just wanted to get a little bit more color on the patient. Can you help us understand the magnitude of the ALT elevation? When the patient or was the patient reintroduced to treatment, consistent with the comment that it was paused? And it sounds like there were no other ALT elevations on any of the other doses based on the press release, just wanted to confirm that. So just wanted to get a better sense of the liver safety dynamics across the overall trial. And then as a follow-up to that, the NAFLD study, were there any restrictions or any comments from the agency as you move forward in the NAFLD study? Any elevated ALT monitoring or anything like that, that would suggest a higher level of monitoring for that? It seems to be a bit overdone from my perspective, but I just wanted to kind of get this one tackled.

Yes. Seamus, thank you for the question. Scott Harris, I know you're ready to answer that question. So I'll turn it over to you.

Sorry, Vipin. Yes, thank you, Seamus, for that question. First of all, in NAFLD studies and NASH studies, there is a very rigorous drug-induced liver injury program in all studies. That applies to any sponsors, and we just simply have adopted that and there were no comments in the IND about ALT elevations. I will tell you that there were no trends in ALT elevations in an aggregate level, in the study at any dose level. So that this was an isolated case of 100 subjects. And we will simply continue to observe it and monitor it going forward. But in aggregate, there was no dose trend that occurred. At the 1.8-milligram dose, it did not occur despite going to the 2.4 milligram dose, and there were no trends that would be observed in ALTs in any of the dose groups.

And can you just confirm that the patient was reintroduced to treatment so that the pause is consistent with reintroducing the patient to treatment and that there were no ALT elevations after that? Or was the pause a pause in the patient, and then the patient was simply followed to the end of the study?

The event occurred at the end of dosing at 12 weeks. When the dose -- drug was stopped, the ALT returned immediately to normal.

There were no other drug-related information on that specifically, so no excess use of NSAIDs, no binge drinking event that occurred in that context. And do we know what the magnitude of weight loss was for that individual patient? Was this one of the uniquely -- one of the patients that had uniquely robust weight loss?

There were no really identifying features of the patient that we would point out to. The subject lost a robust amount of weight. I don't have the number immediately in front of me, but it was probably average of what the other subjects lost.

Okay. Great. And then just as a final question. In terms of the next steps for the program, when do you guys anticipate initiating the various studies? And how are you thinking about the initiation of a biopsy-driven NASH study? Are you anticipating sequencing that after the initiation of the NAFLD study and having that complete? And then -- but initiating the obesity study, can you just give us a little bit of a sense of the time lines and how those might lay out for the individual catalysts?

Sure. Last we've announced, we'll initiate the obesity study around the first quarter of next year. And we are in the process of launching the 12-week NAFLD study. And we do have the option of performing an interim analysis at week 6 in order to make the determination of any change in doses for the NASH study that would commence right after that. The anticipated sequence would be the obesity study starting in the first quarter followed by the NASH study probably starting sometime in the first half, maybe the second quarter, but after the obesity trial.

Next question comes from Yasmeen Rahimi with Piper Sandler.

Congratulations on the outstanding data. Team, I'm sorry to rehash one ALT observation made, but I really need your help to provide a little bit more detail to the extent you can. So let's go back. First question is, can you comment on how high the ALT elevations were observed? Second question, did you see any other liver enzymes elevations or bilirubin to go up in this population? Third question, is there any underlying liver disease in this population -- in this patient? So just please take the time to provide a little bit more color on this question. It is absolutely critical to many of the people who are listening to this call.

Right. So Yasmeen, there were no other associated changes of drug-induced liver injury such as elevated bilirubin or INR. It was essentially an isolated ALT elevation with a very mild increase in AST that you would expect for any transaminase elevations. The magnitude of the elevation was fivefold at its peak, and it rapidly came down afterwards and resolved essentially within 2 weeks. There were also no real underlying causes of liver disease in the subject.

And at what point during the course of the 12 weeks that this occur? Was this at early point of when they were introduced to ALT-801 or towards the middle of the treatment?

It occurred towards the end of dosing, Yasmeen. And based on that, we would have reintroduced the drug, but it was toward the end of the dosing period, and we just decided to observe the patient follow-up.

And then I have a question on the nausea that was reported. So in the 1.8-milligram dose group, it was commented that, that 55% of the patients saw mild nausea. So if you could just comment on when did that occur, how transient was it? I know at week 6, it was reported to be at about 22%. So that would be really helpful.

Well, it was transient in many patients, untreated. We reported at the 12-week readout, we saw the incidences that we reported compared to the 6 weeks.

And I just wanted to go back to the questions that are coming in again to the liver enzyme. You noted that there was no increase in GGT. Is that correct?

That is correct.

It might be worthwhile -- Scott, it might be worthwhile providing more color on nausea and our sort of take on it with regards to this particular setting that we are in with obesity and NASH.

Yes. So it has to be stressed, Yasmeen, that these are mild events of really no consequence that could simply be reported because they were elicited in a Phase I type setting. These are not events that would, in any way, influence the satisfaction or the ability of the subject to stay in the trial. They just don't drive discontinuations, and we expect them to decrease over the course of development as we get into outpatient trials. Reminding you that this was an inpatient-based trial, so the setting is very different. It's very difficult to compare patient-reported outcomes like nausea across treatment -- across studies. There's really no standard for capturing them. And there's a lot of differences in reporting and the like. But one thing that's consistent that can be looked at, for straight comparisons of the discontinuation rates, we have discontinuates in the PIONEER study of Rybelsus of 14% and discontinuation rates as high as 23% in other studies of GLP-1 agonists. And even those that achieved or approached, they don't achieve this level of weight loss. The magnitude of the events is much higher. So consequently, to achieve this level of weight loss, with this safety and tolerability profile, with no discontinuations, especially the balance of the two, is absolutely outstanding and remarkable, and we think this predicts a really excellent effect going forward.

Team, this data is outstanding. I'll jump back into the queue and let my fellow colleagues ask questions.

Next question comes from Kelechi Chikere with Jefferies.

Yes. Again, congratulations on the data here. Just 2 questions from me. First, I know you reported no correlation between weight loss and BMI, but wondering, generally, do weight loss drugs see more or less weight loss with higher BMI or when the BMI is higher? And the reason why I'm asking you this is because the BMI you have here is notably lower than what is usually done in some of the other studies, in the Phase IIb studies for other drugs. And my second question is just related to the secondary measures, including LDL and triglyceride reduction. Is that more robust than what other drugs report at 12 weeks, similar to the weight loss that you're seeing here?

Right. So you're right, Kelechi, and thanks for the question. The proportion -- the percent of weight loss actually increases with higher BMI. So consequently, as we go into studies like obesity studies and NASH studies or NAFLD studies, when we were going to see a BMI of approaching 35, that trend, that observation, would suggest the magnitude of the weight loss in these subjects would be even higher. I unfortunately don't have immediate data to share with you on the comparisons of the triglycerides and the LDL cholesterol and other studies at 12 weeks. I believe that most of those studies report out over much longer periods of time. But these -- the magnitude of these changes are pretty impressive at 12 weeks.

Our next question comes from Liisa Bayko of Evercore ISI.

Congrats on the data. Can you just give us a little more background, if we can just dig into the ALT a little bit more. Was this patient of higher BMI, different age, anything potentially baseline with their ALT? And also, could you comment on oftentimes when you see improved liver health, you actually see a blip in ALT. Can you comment on that as well?

Regarding the second, seeing a blip of ALT with higher liver health, I'm not sure where to take that because I'm not sure I've seen that before. Clearly, in studies of viral hepatitis, you might see a blip in ALT during treatment. But I just really can't take that any further. Regarding this subject, I wouldn't say that there are any identifying features that would specifically highlight this patient per se.

Okay. Yes, I was referring to the experience with a hep C that's often referred to as the liver health improves. Actually, sometimes you do see some temporal spikes in ALT.

Yes. I think that's due to a different mechanism, which is, in order to clear the virus, you need to basically do some liver enzyme elevation to show the virus is being cleared. I am not really sure that will apply to the diseases that we're going to be treating.

Scott, it might be worth mentioning that this -- the BMI of this patient was on the low side. So perhaps that's a detail we should -- you can elaborate on.

Yes. I didn't really want to get deeply into mechanisms here, but let me go there on this one. The patient barely had an elevated BMI. And when the patient was treated, the BMI dropped down to the 25 or less range. So it was a subject who did not start very high, would not have been a candidate for obesity trials or for NASH trials. We actually think that this is a subject that would never really present himself or herself for treatment in the future, either based on commercial use or in studies.

Okay. Speaking of that, you had a couple of patients who were kind of really on the borderline, like below 26, a couple of, like, say, it looks like 25 of BMI at screening. How did -- I mean, obviously, there's no correlation. And we know that we've done a bunch of work with KOLs, and we looked at other studies, there isn't necessarily a correlation with BMI and degree of weight loss. But like why were those people out in the study actually? It seems like they're not...

Yes. It's a Phase I study. It generally include people of a somewhat different range than you would in a Phase II study. Remember that the higher BMI patients and the older people were difficult to recruit in the COVID environment. And I should make a comment on that, that the study discontinuations were essentially due to the COVID environment, although we did not have any COVID cases in the study. Intense COVID restrictions in Victoria, Australia during the study locked down the border and kind of kept a couple of people out or shifting jobs that went over the provincial border and the like. And just the whole environment of people leaving the houses. We didn't get -- We had to -- the discontinuations were predominantly due to that. They weren't related to drug, and it also changed the nature of the age of the patients coming in the study. The older people who may have been somewhat heavier did not come into the study.

Okay. And then can you just talk about the importance of the speed of weight loss? Because it's pretty dramatic, and I think that's really differentiating here. And then just a kind of follow-up to that, did you note any changes in lifestyle, either diet or exercise, even though it wasn't part of the regimen? Did you note any of that as the study progressed?

Yes. We didn't have any measures, Liisa, for capturing changes in diet and exercise. I'm not aware of that being captured in any of the other studies. But we -- I want to agree with you, and I want to state this very clearly, beyond our enthusiasm for these results, these are spectacular weight loss results. And even with some adverse events, it might be comparable to those and other studies. Other studies have not achieved this profile of weight loss and really not very remarkable adverse events. I mean you can count up adverse events, but they were mild and they didn't lead to study discontinuation. And those studies that approached this level of weight loss had much greater adverse events than those that may have had lesser adverse events may have had much lower weight loss than the used dose titration. So the results -- the combined results of this study of weight loss and the tolerability is unmatched by other drugs. The trends that you see that we provided are extremely strong, the rate of weight loss is very great. That's 20 pounds essentially in 12 weeks. And looking at the slopes of the curve, there was no evidence at all that this was going to stop in the near future. We plan to extend those observations as soon as possible. We'll have the obesity trial that will start next year. We've given a lot of consideration to adding on an extension study to our NAFLD study to allow an observation out to, say, 24 weeks and try to get earlier weight loss data. But I would stress that we haven't made that decision yet. We're looking at that, there would be a possibility of a readout that occurs as much as 6 months earlier. But again, that decision has not yet been made.

Okay. And then just final question for me, and it kind of parlays of what you're saying. The patients on this study, are you continuing to follow them? Will they continue beyond 12 weeks? I know that the study is kind of wraps up at 12 weeks, but what's -- what are the next steps for this particular study? And will there be any follow-up?

Yes. There's routinely a safety observation period, which, in this case, will be approximately a month, and we'll continue to observe people. And we'll have weights on them then. And typically, when the drug is stopped, the weights go up again, the weight loss diminishes as the drug is withdrawn. But typically, there's a follow-up period of about a month after the drug is discontinued.

Our next question comes from Mayank Mamtani with B. Riley Securities.

Congrats, again, on the compelling weight loss data. And we just did the lipid cross trial comparison, don't see this level of decline that you show even with 40 weeks of Lilly and Novo drug. I guess my question quickly on the study design feature that you had here on unblinding at 6 weeks with the 1.2 and 1.8 mg and that not being there for the 2.4 mg dose. Obviously, from a weight loss standpoint, that kind of put a higher bar on the 2.4 mg dose. But also from a safety standpoint, if subjects kind of know that they're receiving drug and they're benefiting from it, can you maybe comment on like the probability of them may be also reporting these mild nausea events? And maybe this 1 individual, younger -- on the younger side, engaging in an activity like binge drinking or something that caused ALT elevation. Could you just comment on this phenomenon that you had where you took an interim look at 6 weeks versus for the higher dose you didn't?

Well, we didn't have -- Mayank, thanks for the question. And when -- we had promised The Street a readout at 6 weeks. And at the 6-week point, the third cohort was still ongoing. So we couldn't readout on that. So that's why that data was not included. As we announced to The Street, we would provide an update on the additional cohort that was being dosed at the time of the 6-week interim analysis at 12 weeks, and that's what we've done. Regarding the subject, it's impossible to note if there was drinking or anything else that was going on. And this is something that wasn't captured. But I want to stress that it was one subject out of 100. It resolved quickly upon stopping the drug, which is extremely important because it means we have a handle on it. There was no other evidence of liver injury such as bilirubin elevation. And it was not dose related. So we saw no cases of the 2.4 milligram dose. I think -- we think it's an isolated case. We don't really have a handle on why it occurred. We think this patient is an outlier in terms of not only the liver abnormalities, but the likelihood of being included or profile of this type of patient being included in later trials with patients with higher BMI.

Great. And on the next Phase II study, could you just clarify the doses that you're thinking? You said 1.8 mg as the foundational dose. And we also noticed that I think you had previously said 24-week length for that study. But I think now you're saying a 48-week. Can you just clarify sort of what you've learned from this update that has informed how you're thinking about your Phase II study obesity? And then I just have a quick liver fat question, the NAFLD side of things.

Right. So thank you for the question, Mayank. And again, it will be a 48-week study that will be with a 24-week interim analysis. We thought about doing only a 24-week study. We think that would be acceptable to the agency to get ready for Phase III and to rationalize going into Phase III. We thought it would be more worthwhile to people if we extended it to 48 weeks. But we are -- we'll post to the agency the question when we file the IND of whether we could take the 24-week interim analysis and use that to file the IND, say, 6 months earlier and also to continue the trial as we get ready for the Phase III. So it's possible the two might be going on at the same time. But I want to stress that conversation hasn't taken place with the agency and their preference may be to see 48-week data. Regarding the doses going forward, we're certainly going to take the 1.2 and the 1.8-milligram dose going forward. We're trying to make a decision now about the 2.4 milligram dose and haven't made that. We'll make that shortly.

Great. And on the liver fat side, ketone body data looks very impressive. Could you maybe comment on -- you had some PDFF greater than 10%, about 20% of the proportion of the patients in this study. Did you do a subset analysis on maybe how they did? Just trying to understand how the liver fat readout could look like from your NAFLD 12-week study early next year?

Yes. We don't have the results. We did MR scanning, right, to look at body composition. We don't have those results yet. We could look at the liver fat. When we looked at those initially at the beginning of the trial, patients were not coming in with a sufficient amount of liver fat to do that analysis. So we'll have to go back and look to see if we can still do that MRI analysis of the liver fat.

Our next question comes from Jon Wolleben with JMP Securities.

My congratulations on the data as well. Just a couple of short ones for me. How many centers were involved in the study? And then you mentioned the patient with the ALT elevation was -- had a lower BMI. Was the drug exposure level any higher in that patient?

Yes. Thanks. It was only conducted at 1 center, Jon. And your second question had to do with -- I'm sorry, can you repeat that?

The drug exposure in the patient with ALT elevation, if it was any higher than the average?

No, it was about average. It was not unusual.

2 Okay. And I was hoping you could comment a little bit on the characterization of mild to moderate nausea and the time course. I think there may be a difference, if these are one patient reporting one instance early on versus a patient reporting it every week throughout the trial? So maybe any color on that front could be helpful.

It was predominantly one-off events, although it was a bit mixed, but there were many events that were simply one-off. And in terms of the definition, mild cases are cases that resolve spontaneously, that do not interfere with daily activities, that's the definition. You might have mild nausea right now, but continue with the rest of your day. And these are -- these mild events were untreated by definition. The definition of moderate is that there's some imposition on daily activities as assessed by the investigator. And very often, that's associated with treatment, but not necessarily. But clearly, with the mild events, they're unremarkable events to the subject, simply noted by the subjects and not requiring treatment. And I'll double up on that by saying that I'm not really sure what a mild event means to a subject like this that means to a subject that's losing a very substantial amount of weight loss. And in terms of the balance of their own intention, their own therapeutic effort to lose weight, which is otherwise very hard in the lines of these people to be getting a 20-pound weight loss and feeling a bit of mild nausea maybe once in 12 weeks is pretty remarkable, we think.

Our next question comes from Patrick Trucchio with H.C. Wainwright.

Congrats on the data. I have a few follow-up questions. The first one is on Slide 16, glucose homeostasis was maintained. Can you tell us what the rough contribution is from glucagon versus GLP-1 and -- to the overall mechanism of pemvidutide? And the level of confidence that pemvidutide should not impact glucose homeostasis in diabetic patients based on the data that's been generated to date?

Right. We don't think there's going to be an impact, Patrick. These are subjects that were predominantly prediabetics and had abnormalities of glucose homeostasis, and that's evidenced by the HOMA-IR that you saw a normal one being about 1.5 and certainly no higher than about 1.9. And you'd expect a 2.5 in a younger population that was overweight and obese. So these are subjects who had high insulin levels to begin with, and we're maintaining glucose homeostasis with the pressure of increased beta cell activity in order to maintain that. So consequently, this is a very relevant population for assessing glucose control in the future. We did not see any mean changes in blood sugar. We didn't see any mean changes in hemoglobin A1c. We didn't see any hyperglycemic events. We think that's attributed to the perfect balance here between GLP-1 and glucagon, which is the intent of the molecule to get one-to-one balance. So that the GLP-1 balances out the effects of the glucagon and I think it's evident here with really excellent maintenance of the glucose levels in these patients. Now going forward, we do think that, that maintenance will be seen in diabetics. We even think there's a real potential for glucose lowering effects, especially over the longer duration of treatment as subjects lose weight and continue to improve their insulin sensitivity. And as noted in the step 2 trials, the predominant factor accounting for the drop in the hemoglobin A1c at the 68-week mark, which was the duration of the STEP 2 trial, was not the incretin effect of the GLP-1 on insulin secretion, but it was the reduction in body weight and an improvement of insulin sensitivity. So we think it's -- we think there will be no, at worst, no differences in the diabetics in that study. It's a safety study to show that at a minimum, glucose homeostasis is maintained. But there's also the great potential to see improvement of hemoglobin A1c, maybe not necessarily in the 12 weeks, but certainly in a trial of longer duration.

Yes. That's helpful. And then on Slide 17, which outlines the reduction of ketone bodies, can you further discuss these increases and how they are driven by the mechanism and help us frame these levels of ketones, including implications of increases of the magnitude outlined relative to placebo?

Right. So these are very relevant increases and what they suggest is a shift to fat metabolism, which results in the production of ketone bodies. It shows fat burned. And it's consistent with the mechanism of glucagon shifting the utilization of carbohydrates in these obese people to utilization of fat, which is exactly where we want to be with them.

Okay. And then just last on the Phase II obesity trial, the dose subjects up to 1-year with the plan, 24 interim analysis late in 2022, can you tell us what the baseline characteristics of the patients enrolled in this trial would be expected to be? What proportion would be diabetic patients? Secondly, can you give us an idea of how many patients will be included in the interim analysis and what it would be powered to generate in terms of weight loss or other end points? And finally, if the interim analysis generates -- demonstrates sufficient safety and efficacy, would you then take that data moved straight into the Phase III program prior to having a full data set?

Right. So let me try to take all these questions and not necessarily in the order you asked them. At the 24-week interim analysis, it will be powered for efficacy. And the clear result will be to have sufficient changes at 24 weeks, which should be possible because a great deal of the changes occur by 24 weeks in order to justify efficacy and also to move ahead into Phase III. That study will be a study in nondiabetic individuals. We are thinking about conducting a separate study in diabetics, but that's not on the books. And I believe there was one more aspect of your question, which I didn't address, and I'd be happy to take that if you could repeat your question.

How many patients would be included in the interim analysis? And what -- can you tell us what it would be powered to generate weight loss?

I don't have that actual figure in front of me. The protocol -- the full details of the protocol are on the drawing board right now. My assumption would be that because of the rapid enrollment of this trial, because these trials are much faster to enroll the NASH trials, we would probably include all the subjects in the interim analysis.

Our next question comes from Yasmeen Rahimi with Piper Sandler.

Can you comment on the SAD portion of the study, how high you went on to the doses? And obviously, the monitoring that occurred for liver enzymes. The second question is, can you comment on the preclinical data package in terms of how high of dosing did you go? Did you see any liver enzyme elevations in the tox package? So if you could just help us get comfortable that, that one patient is more an outlier, that would be helpful.

Sure. So we, in a single phase, went up to 4.8 milligrams, which is 3x the -- approximately 3x the 1.8 milligram dose, and we saw no liver function abnormalities. And regarding the tox program, again, this was only one case that was seen in all the subjects from the SAD and the MAD. Just one subject. In addition, in the toxicology program, Yasmeen, we saw no adverse events at all. We saw no liver function changes whatsoever. This is something that was not observed. The dose margins in terms of the exposures were higher than the dose margins -- let me rephrase that. The serum concentrations that were changed in monkeys were a margin higher than the serum concentrations that were obtained in humans. There was a good safety margin, and there were no liver function abnormalities seen.

And is there an opportunity to kind of go back into that patient -- in that 1 patient in the SAD? I mean, the study was done during COVID and a 30-year-old population. I mean, is there an opportunity to ask if there was significant drinking during that week prior to assessment for the liver enzymes? Is there a way to really -- or did you get a chance to look into that question just to kind of...?

Well, we asked the question. We asked about a number of things. And it's a difficult time in Australia, and I assume that people were staying at home and drinking. And I don't know in this patient, it was certainly asked. Whether we got a truthful answer is uncertain. But I just want to stress, Yasmeen, that we have 1 case. It resolved quickly. It's not been seen in any of the other subjects despite going to higher doses. It was not seen in our tox studies. It was seen in a type of subject that would be very unlikely. If it was the weight at the BMI of coming into the study, the subject was barely over the acceptable BMI and would not be getting into either an obesity or a NASH trial. We knew that these subjects did not have fatty liver. These subjects would not get into a NASH trial, would not get into an obesity trial. And it's our very strong belief, very strong belief, number one, that we won't see it again. Number two is that we have a very extensive monitoring program, which is not atypical. It's just simply the template DILI or drug-induced liver injury program that FDA wants in all NASH studies. And for convenience, we have it in our obesity study as well. But just simply, if you have it in one, you have it in the other. But we just don't think it's going to occur again. And if it does occur, I think we have a very strong handle on it. So we'll continue to observe it. We'll continue to look for it. But at this point, we have good control over it. We don't -- we think it's an isolated event, and we have very close monitoring systems that will be put in place to capture it, if it does happen. We don't think that there will be any injury here that would result in any consequences here.

And then one other comment or question I had for you is, so the baseline weight in this population was 90 kilos and historical rates have been 105 kilos. So obviously achieving a double-digit weight loss in a population that weighs less is really, really remarkable. So I mean, can you maybe comment on, one would speculate that if you had 105 or 110-kilogram weight group, the magnitude of effect would be significantly higher. So just would love to hear like this data point and how you're thinking about it, because it's obvious the more you weigh, the more you're going to lose weight. And I think that's being not -- I think we should discuss that on the call.

We think it's really remarkable that we were able to achieve double-digit weight loss in this particular population, Yasmeen. And we think as we go to heavier people, the rates of weight loss will probably increase. It's been seen in other studies that you get a higher, a greater degree of weight loss in people who have a higher BMI. So we think that to achieve this kind of weight loss in a lighter population is very, very positive.

Yasmeen, if I could jump in here, I wanted to stress or emphasize one more point. We've mentioned it, but I think it's really important in the context of what we are trying to achieve here is, all of this data that we are showing, all of these results that we are showing are in the -- there is no dose titration involved. So we're doing all this in the absence of dose titration. And we are comparing to everything else that's done with dose titration. So I just want to reemphasize that point that, that is also a significant advantage for this molecule, not only the rapid weight loss, the magnitude of weight loss, but also lack of need for dose titration, we think is going to be critical in terms of developing a successful molecule.

Let me follow up on that, Vipin. We think that dose titration is a tremendous advantage. And, of course, not titrating leads to faster weight loss, although we think that a large, if not most, of the properties of the weight loss are due to the molecule and its unique mechanism rather than the absence of titration. But dose titration is a problem. And as we shift obesity treatment from endocrinology, because remember, these drugs, these GLP-1s have been used predominantly by diabetologists and endocrinologists or specialists. This is now shifting to primary care, where primary care doctors have 10 minutes with each patient, and they don't want to deal with titration. And there's the ongoing saying that diabetics are noncompliant. You're going to give them another reason for noncompliance. So we think that the acceptability of a compound that's not dose titrating, we don't think we have to. We always could if we ever thought we wanted to. It's always there as an option for us. Companies that are titrating don't have that option anymore. We do have that option. We're not saying we're going to use it, but we have it. But we just really think that this property is extremely important, extremely important going forward and the adverse event profile we saw was despite not employing dose titration. We didn't get discontinuations. So we really think that it's a tremendous part of the program.

Our last question comes from Seamus Fernandez with Guggenheim.

Great. So 1 in 100 ALT, rapidly resolved. I think one thing that might be lost here is the fact that this is also a weekly drug. But I wanted to focus in on a little bit more on some of the other benefits. Can you guys talk about the magnitude of blood pressure reduction and the magnitude of lipid reduction, particularly LDL reduction that you're seeing at this early time point relative to some of the other datasets that we've seen elsewhere. This seems to be another unique property of this drug that perhaps is lost in this conversation around the single 1 in 100 ALTs.

Right. Well, the magnitude of the weight -- of the blood pressure change is the magnitude that you see with blood pressure reducing drugs, I mean, at 12 weeks. And remember, as people continue to lose weight, they're going to continue to have excellent control and even better control of blood pressure changes. And the drop in blood pressure is known to occur with GLP-1 agents is felt to be cardio-protective. It's, in fact, the rationale for the development of GLP-1s for the treatment of congestive heart failure. As I indicated in my response to Mayank's question, we don't have data at 12 weeks, but the amount of lipid reduction we're seeing is comparable to what other drugs were achieving in 52 weeks. So the sky is somewhat of the limit here in terms of the amount of lipid improvement. We may see as this trial goes forward to 50 -- 48 or 52-week readout.

And then just as 1 final follow-up, I don't know if folks noticed this in your presentation, but the path of the weight loss curves still seems to be pretty robust at 12 weeks. Just thought I would raise that and any thoughts on the potential incremental magnitude that you would hope to see going forward?

Thanks, Seamus. So we're seeing no evidence that the rate of weight loss slows down to 12 weeks. We don't have the data beyond 12 weeks. This is only a 12-week study. But if one plots the rate of weight loss here versus other drugs, it's much faster. Will we plateau at some point? We have to. When will that occur? Well, in animals, it didn't occur until animals returned back to their ideal body weight, the obese animals. Could we achieve 20% weight loss? I think it's possible. But again, we're projecting from 10, and when would that occur? Would it go out to 48 weeks, would it occur by '24? I think we're going to have to do longer-term studies. Recognize that with bariatric surgery, you're in the range of about 25% weight loss. So the ability to achieve this with drug therapy is very remarkable, and it's quite possible that we may get there with longer-term studies.

And I'm not showing any further questions at this time. I'd like to turn the call back over to Vipin.

Yes. Thank you, everyone, for joining us today. We look forward to talking to you soon again. Have a wonderful day.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.