Roche Holding AG (ROG) Earnings Call Transcript & Summary

I'm the technical operator for today's call. Kindly note that the webinar is being recorded. [Operator Instructions] One last remark, if you would like to follow the presented slides on your end as well, please feel free to go to roche.com/investors to download the presentation. I would like at this time, it's my pleasure to introduce you to Bruno Eschli, Head of Investor Relations. Bruno, stage is yours.

Thanks a lot, Henrik. And could I have the first slide, please? So welcome to our IR call focusing on our emerging CVRM franchise. And the first data presented at EASD for our weekly injectable biased dual GLP-1/GIP agonist CT-388 and our daily oral bias GLP-1 agonist CT-996. Let me quickly take you through today's agenda. As a speaker for today, we have with us Manu Chakravarthy, our Global Head of CVRM, cardiovascular, renal and metabolism product development. Some of you might know him already as he was the Chief Scientific and Medical Officer of Carmot Therapeutics. He was incremental to Carmot's broad and diverse development efforts in the obesity and diabetes space. Manu is also a member of Levi Garraway's leadership team and will have the product development for our newly formed therapeutic area, CVRM in the future. Today, Manu will first provide us an update on our obesity and diabetes assets from the emerging CVRM pipeline. Thereafter, he will take us through the CT-388 and the CT-996 early data sets presented at EASD in the recent days and putting them a bit into a wider context. And finally, we have 45 minutes reserve for Q&A as we expect that all of you will have a lot of questions. For the Q&A session, we will also be joined by Louis-Andre Villeneuve, our Lifecycle Leader for the Obesity & Diabetes assets. Can we have the next slide, please. On this slide, I just quickly wanted to provide an update on the remaining news flow for the year. A few updates here tiragolumab. I just want to confirm SKYSCRAPER-01 results for Q4, inavolisib everything on track for the launch, PDUFA date is set for November 27 in hormone receptor-positive breast cancer. Prasinezumab, we expect the Phase II PADOVA data in Q4. Evrysdi GYM329 in SMA. Here, the data, the readout just slipped into next year, early '25. Trontinemab in Alzheimer's disease, we will provide here a new data cut at CTAD this is end of October, beginning of November with an IR event focusing and summarizing the data. This will be, as mentioned before, more than 100 patients, the original dosing cohorts and then some patients from the extension cohorts. Gazyva in lupus nephritis, we expect pivotal data in Q3. And then on the TL1A antibody, you will get an update here at the Pharma Day September 30, about new Phase II starts in indications outside of IBD. Vamikibart, our first class IL-6 in ophthalmology, we expect still data in DME towards year-end. And then CT-388 and CT-996, we'll discuss today in more depth and let me also point out here already that the Phase II results for CT-868 in Type 1 diabetes, which we originally expected at end of the year have slipped over into 2025. Can have the next slide, please. Yes. Let me also quickly provide you an update on the upcoming IR events. On September 30, we will again host our Annual Pharma Day in London as Live event. The event will have two parts. A morning session with Thomas Schinecker, Teresa Graham, Levi Garraway, who will discuss Group strategy, Pharma strategy and progress we made on the R&D excellence side. And then in the afternoon, we will take you through the entire pipeline of our new -- our 5 newly set up therapeutic areas, that's oncology, heme, neurology, ophthalmology, immunology and CVRM. And during this event, you should have plenty of opportunity to meet and discuss with all our senior management, including Manu, who will be present as well. Next, on the first here -- next on the first days of November, we will have the IR call focusing on the neurology franchise and the updated trontinemab data presented at CTAD. And then finally, to finish the year, we plan now for a full Digitization Day, which is now scheduled for November 25. And with that, let me hand over to Manu for an update on the data and the franchise, Manu, please.

Thank you, Bruno, and good to be here. Next slide, please. So before we dive into the assets, it's worth taking a few slides to level set in terms of how at least at Roche, we're thinking about building out the new CVRM franchise and how we really view obesity as part of that enterprise. So as many of you know and at this point in time, it's well accepted that obesity is, in fact, a core driver of many of the comorbidities that we are used to seeing that were at one point, independently sort of thought about, but now really anchored largely through the modification of adiposity or high body weight. And you can see here that obesity at this point in time, literally is associated or at least drives many of the comorbidities, including Type 2 diabetes, MASH, even cirrhosis, heart failure. We've heard a lot about that. Chronic kidney disease, of course, obstructive sleep apnoea, osteoarthritis, and several others and as we continue to emerge with the learnings of incretins from this EASD meeting, even neurodegeneration will eventually be on this list. So for this reason, if you go to the next slide, please. The market is responding to that notion because of the fact that not only is obesity associated with so many comorbidities, the population is also experiencing a significant rise in the prevalence of obesity. In fact, if you look at both obesity and overweight by the next decade or so, is projected to be around 3 billion which roughly is about half the world's population. So we need to sort of look at it that way, it's really daunting. And so no surprise that obesity is one of the most dynamic segments, with the obesity market projected beyond $100 billion by 2030. So the next slide, please. So for that reason also, it is not surprising that a majority of the activity that we see in the marketplace today and specifically across both large pharma and biotech and the general biotech sector, biopharma sector is very active development of the obesity pipeline. Majority of this currently still is dominated by the incretins. In fact, increasing have become the backbone of obesity treatment. And one of the key reasons why Roche has entered into this space with CT-388 and 996 and 868 as the incretin backbone upon which we will want to build the franchise out further. And these gut hormones, which are shown on the right there, are prime targets to modulate largely because they literally impact nearly every organ system in the body. They're centrally involved for glucose homeostasis, weight management, even addiction and behavior. So they really are at the core of everything that we're trying to do in terms of energy homeostasis, nutrient regulation as well as understanding of some of these other end organ complications. Next slide, please. So the current Roche clinical development pipeline in obesity and diabetes is shown here. These are largely focused on our clinical programs. We will not be discussing any of our research early pipelines today. But suffice to say, there is active work that's ongoing in the research side as well. So today, we'll talk a little bit more in detail about CT-388 and 996. So we'll come back to that. But just as a brief mention here, CT-868, which is also a dual GLP-1/GIP receptor agonist, but it's been designed specifically to be once daily, so that it's ideally best suited to be treated -- used as a treatment for Type 1 diabetes. We believe that's a very important opportunity for Roche because there's not many, I would say, probably none at this point that is formally approved as an adjunctive therapy for Type 1 diabetes. Several incretins and SGLT2s, et cetera, have been used off-label, but none have been actually approved on-label as a formal adjunctive therapy other than pramlintide, which was approved many, many years ago. So we're very excited about that. A little bit early in our pipeline is a long-acting PYY analogue with an expected Phase I entry date in 2025. And then we have GYM329 which is our anti-latent myostatin antibody, which is plan for a potential combination study with one of our incretin backbones, again, in the 2025 time frame. The next slide, please. So just before we get into the specific data, it's worth spending a couple of minutes on how these molecules that were discovered at Carmot was actually thought about and designed and starting to lay out the potential for differentiation, not just from a clinical perspective, but really even on a molecular pharmacology perspective. So when you think about native hormones that we just talked about, like GLP-1, GIP. All of these native hormones, which are all GPCR targeted molecules, they signaled through what is called the G protein complex, which is the alpha, beta and gamma sub units. And that G protein complex when it gets recruited to the receptor or when the ligand binds to it, as you can see in the far left side of the graphic, it activates cAMP. As part of that signaling cascade is also another very important protein called beta-arrestin. And when beta-arrestin gets recruited to the incretin receptor, it's sort of thought about as an off signal. Because when beta-arrestin binds, it actually helps to degrade the receptor internalizes it and shuts off the signal. So a Carmot, we first embarked on this a few years ago, we asked a seemingly simple question, which was what if we could actually turn off the off signal, would that enhance the efficacy more because now you don't have the protein that actually degrades the signal, removes the receptor from the membrane and the signal stays on longer through cAMP. So because it signals through cAMP and not through beta-arrestin, we call them biased receptor modulators or biased signaling agonists. Now of course, the big question is, does it really matter. It's nice that you could do this, but does it actually show any type of benefit in terms of its potential to increase efficacy, in what way would that be really of use. So we have some preclinical data because there we can really dissect this in a fairly detailed way. So if you go to the next slide, please. We've done some of those studies in the clinic -- preclinically. And of course, we need to do those experiments in the clinic to really build upon the story. So what you see here is examples of the beta-arrestin-2 activity the top portion of this figure, just to show you how does this compare to either the native hormone, which is GLP-1 or another GLP-1 receptor agonist, liraglutide, I mean we could have certainly some liraglutide here as well and you get the similar results. And what you see on the GLP-1 receptor is, you have strong activity of beta-arrestin as you would expect of an unbiased ligand, like GLP-1 or liraglutide and here, we're using 868, but 388 will also behave the same way. You see that the blue line shows that there is a flat line on beta-arrestin-2 activity, which is indicating that there is no beta-arrestin signaling, both on the GLP-1 and on the GIP receptor. To the best of our knowledge, this is truly a unique attribute of the Roche molecules at this point in time. On the lower panel of the graph, you can see the consequence of no beta-arrestin. As I mentioned to you, beta-arrestin is the molecule that internalizes a receptor and eliminates the signal. So you can see when we compare it to either liraglutide, native hormone, or in this case, even compared to tirzepatide, you can see the blue line, which goes down, which indicates that there is very little to no internalization. The black line and the gray line are the controls because those are unbiased ligands. And so it tells you that in the native state, there's a lot of internalization. Tirzepatide has a slow blunting of internalization, but 868, 388 have much more profound blunting of the internalization, which means that the signal is kept on in the on-state longer. And on the GIP, you can say they see the same thing, very significant reduction in internalization with the Carmot or the Roche molecules, tirzepatide a little less. So if you look on the right side, this is the in-vivo evidence that tells you that by keeping the receptor in the on-state longer, you get more profound or more prolonged efficacy. So the graph that says blood glucose versus time it tells -- this is the data that shows that when you compare it to a native hormone or to liraglutide, which is in red, you see blood glucose goes up. And then it essentially comes back down a little bit in the setting of an OGTT, but remember, this was done 48 hours after the dose, okay? So the animals were dosed 48 hours later, we did an OGTT, and you can see that blood glucose is -- with liraglutide is the same as that of the vehicle. But with 859, which is essentially the mouse analog of 868. You can see profound and continued suppression, which tells you that that's the case because you're keeping the receptor in the on-state. On the weight loss you can see the same thing. So when you actually dose, this is just with a single dose, and you give the dose and then you follow what happens over a subsequent 80 hours or so, you can see that liraglutide initially over the first 24 hours decreases the body weight, but it comes back up. Whereas with 859 or 868 or 388, all the biased molecules, you see this continued and prolonged suppression of glucose and in body weight. So overall, this is the evidence that we have that says biosignaling could be indeed a potential differentiator. Now of course, I will be the first to say that this is preclinical data, but this gives us a very strong encouragement to take all these molecules into the clinic, which we did to then continue to see if this hypothesis continues to pan out. Next slide, please. So 388 quick snapshot. Again, we'll go through the data in a little bit more detailed way. It is a once-weekly dual GLP-1/GIP, again, fully biased on both with receptors. So we'll share with you the emerging data from the 101 study. Parts of the data from the 101 were already presented last year at the ADA. At the EASD this year, we're just continuing to build upon the data sets that's coming out of that multipart, multicohort study. As Bruno mentioned earlier, we've already initiated Phase II with 388 with our -- what we call the 103 study, which is an overweight/obese subjects. And then we have a study that is planned to initiate later on in the 4Q, 2024 time frame with overweight/obesity plus Type 2 diabetes. So those two will position us really well as we fine-tune the final dose that we want to take to Phase III, the titration regimen that we want to take to Phase III and then we're doing everything that we can to accelerate the planning for Phase III as well. On the right is just a schematic, just to give you a flavor of the Phase II design. And that tells you that we are actually studying a wide dose range, going from a very low dose to a very high dose across multiple different steps of titration. At this time, we're not going to be able to discuss in great detail what those exact doses are. But suffice to say, it's in a wide enough dose range that gives us all the information that we would need to go into a pivotal program. The primary and the secondary endpoints are all exactly what you're used to seeing, which is the percent change in body weight and our key secondary endpoint is, of course, going to be various other measures of body weight changes, including body composition. Next slide, please. 996, again, we'll cover this data in more depth. But this is also a program that is planned for acceleration as best as we can. So you'll see the data from the -- some portions of the 201 study because that also is a multipart, multi-arm study and the data that we showed at EASD is from the MAD portion in the non-Type 2 patients. And we also have an arm that is in the Type 2 patients, which is planned to initiate in the fourth quarter of 2024 with an expected data readout in 2025. And then from there, we would, of course, plan to initiate the study -- Phase II study with 996 as well. In fact, the data that we already have on hand today gives us the confidence to go into Phase II. These data on the 986 I'll cover, when we cover the 996 into more detail, so we can go to the next one. So 868, as I mentioned to you, a very exciting program. It has the potential to be the first-in-class, as I indicated earlier because there are no on-label adjunctive therapies for people living with Type 1 diabetes today. So we've done already a fairly extensive program for this, which includes a study -- mechanistic study, which we call the 868-003 study in Type 2 patients, where we showed in a weight independent manner the profound lowering of glucose and insulin, enhancement of insulin sensitivity that 868 can bring. We also have a similar mechanistic study that's actually almost completed, which we call 868-005 to continue to build the story in Type 1 diabetes. We completed a formal POC study, which we call 868-002 in Type 2 patients. And that has been reported already in previous conferences, including The Obesity Society. I'll highlight for you some of the data in a second. And then 868-004 is our ongoing Phase II study proof-of-concept study in Type 1 patients that is currently ongoing with the data expected in 2025. And that data will then -- we anticipate should set us up for a potential pivotal study in the subsequent time. So just to give you a flavor of 868 because we won't talk about this in the rest of this call. A very potent molecule, a very robust in terms of its activity. And you can see here, when we dose patients with Type 2 diabetes overweight and obese, over a 26-week interval, what you see is a profound reduction in A1c, which was our primary endpoint. Placebo-adjusted change was 2.3% reduction in A1c. If you quickly scan over to the right side, you can see the proportion of people that achieved various hemoglobin A1c categories. So remember, all these people were diabetic when they entered the study. By the time they left the study in 6 months, more than 70% of people no longer had diabetes, as defined by the ADA criteria of 6.5% or less. That's essentially a profound impact that this drug could have even for people with Type 2. But since we have obviously 388 for Type 2, we're going to focus on that, and this will be positioned for Type 1. So very exciting result. We feel that there's flexible and easy integration of the QD regimen into an insulin regimen that people with Type 1 diabetes take. Many Type 1 patients still take multiple daily injections of insulin. So adding this on will help them lower their burden of insulin and to improve their glycemic control and, of course, to improve third body weight as well. And then the next slide, just to again give you a flavor very quickly of our earlier assets I indicated GYM329, anti-myostatin and long-acting PYY analog. So these are positioned as either stand-alone or these MOAs can, in fact, be tailored as add-on therapies or combo therapies to address the various comorbidities or to actually address the various segments of obesity, which clearly, there are many of. So we don't look at obesity as a one-size-fits-all. In fact, there are many segments of obesity that having such a portfolio allows us the luxury, if you will, to mix and match and really make sure that we're really bringing the right therapy to the right patient at the right time. So when you think about incretin-based therapies, what we envision is potential future combinations to either preserve lean mass, which we can do with GYM329. We're looking at agents and mechanisms that can continue to augment the decrease in energy intake such as the PYY. We are looking at agents that cannot actually increase energy expenditure. So the other side of the caloric balance equation, not just the decrease in food intake, but also the increase in energy expenditure. We're looking at other different hormonal modulations of glucose control and other MOAs. So very exciting time at Roche for this therapeutic space to take hold off and to really burge in the years to come. The next slide, please. So a quick summary, a quick snapshot and then let -- I think we've already covered a lot of this. So I think we can sort of transition now to the next slide to provide a little bit more of -- just a high-level view of how we're actually setting up our portfolio to leverage the opportunities that are available in obesity, which there are plenty of. So I think we all recognize and certainly many of you having covered this space for a long time, will appreciate that despite the many approved therapies and we can anticipate more therapies to be approved. There still remains lots of unmet needs and some of which are highlighted here. And of course, the one that's on top of everybody's mind is muscle preservation. Sure, that's obviously, something that we are interested in as well, and that's something that the field is also trying to think hard about. But it's not just that. I think there are a few other things. So we are highly focused on the totality of the patient experience, the holistic view and really asking the question, what do patients living with obesity really need? So I think the key things are, as I indicated earlier, obesity impacts lots of comorbidities. So we have to provide solutions for that. We have to think about solutions that can improve the tolerability profile. How can we actually not just induce the weight loss, but how do you actually maintain that weight loss. In my view, that would be the Holy Grail of obesity therapeutics is weight maintenance. Not easy to do because the more weight you lose, the more metabolic adaptation you have, the harder it is to keep that weight off, that's why people regain all the weight back. So how do you essentially hack into the metabolism to tell the body to actually continue to preserve that weight loss. It's very important to be able to do that. Of course, convenience -- compliance is important. And then one of the other advantages that Roche has is, of course, it's integrated diagnostic and digital solutions. So we have that opportunity to bring those capabilities to bear on the therapeutic space, to really marry the drug device, diagnostic and digital health components that can help us really think about all the components that's really needed to provide this holistic patient solution or the patient experience. And of course, combinations and segmentations are always in the forefront of our mind. Because we don't, as I said, to reiterate obesity is not a one-size-fits-all area. It is indeed segmented. And so we have an opportunity with our portfolio, but not just internal ones, but also the ones that we are planning on building, how can we address these segments. Next slide, please. Just a quick word on the manufacturing approach. Any questions on this, we'll be happy to take later. But we do recognize that with the type of scale and the access and the ambitions that I just outlined, we cannot achieve that without being able to bring these medicines in a scale that is commensurate with the need. So Roche is a global manufacturing network. It has industry-leading technical development and scale-up capabilities. There are internal capabilities already for device as well. And so the organization is geared up to be able to supply the needs that is required to address this level of scale for the peptides. Now of course, one of the advantages with CT-996 is that it's an oral synthetic small molecule. So it's not a peptide like what folks are used to seeing like semaglutide or [ amacrines ] or any of the other dual GLP-1/GIPs, all those peptides have been converted to an oral through a formulation approach, 996 is a true small molecule. And so the COGS will be anticipated to be much more straightforward, much more simpler to make. And therefore, this will be easily supportable by the Roche manufacturing network. So the overall takeaway here is that the organization is gearing up with all of the necessary requirements to supply the medicines that we need, not only for clinical but hopefully, for the launch as well. Next slide, please. So at this time, I'm going to transition from the overall approach, we can -- during the Q&A session, we'll be happy to answer or elaborate anything further. But I'm going to now transition to a more data-specific presentations. To give you some key point takeaways from the EASD presentation that we just did. So next slide, please. So we'll start with CT-388, which is, as I mentioned to you, our once-weekly dual GLP-1/GIP agonist. So if you go to the next slide. So I think we can skip this because we have already alluded to -- the characteristics of this molecule. So CT-388-101 is our first-in-human multipart, multi-cohort, randomized, double-blind, placebo-controlled study, that's Phase I study, it was designed with 13 different cohorts in it so that we could maximize the information that we could get as in the earliest time frame possible. So the overall study objective was really primarily to look at the safety tolerability of the molecule. PK properties of the molecule and of course, to look at what happens, at least in a secondary or exploratory way to weight loss trajectories in both single and multiple ascending dose settings from as little as I said, 2 weeks, 4 weeks, 24 weeks. So a wide range of doses, wide range of time points. In this presentation, I'm going to specifically focus our attention to two cohorts. One was a 12-week cohort, which was dosed up to 8 mgs and another one was up to 22 mgs over 24 weeks. So next slide, please. Here is the design of those two specific cohorts. So again, 8 milligrams was designed to be what we call a simple single-step titration that was designed to achieve the 8 milligrams in a single step. So you go 5 and then 8 and then you maintain the 8 for 9 weeks for a total of 12 weeks of duration. The other cohort, which we call the multiple dose 22-milligram cohort was designed to be a little bit more elaborate. So we started at 5 mg and escalated all the way to 22 mgs in as little as 8 weeks. So we went from 5 to 8, 12, 17, 22. So very steep, relatively brisk up titrations in up-dosing very short period of time. There was flexibility, of course, provided for each of those steps so that patients could take an extra week or two to get to their dose. And whatever dose that they got to on week-12 was that dose they maintained for the subsequent 12 weeks. So this had a rapid up penetration period and a maintenance period to it. If you go to the next slide. So many of you on the call well-versed with the incretin literature. So I don't have to tell you that when you titrate low and slow, it has been shown to improve tolerability. We already knew that, obviously, when we designed the study. So this was not some revelation that we did not know about. The whole point of why we did what we did was to actually have a what we call a fail-fast approach early in development. We knew that this is a highly competitive space. We don't want to be taking molecules that are -- that do not have the bars that we would need to have, which are very high. They need to be very competitive. And so the best way to do that is to actually derisk early. And the best way to understand that is to do a brisk up titration. You go to a higher starting dose, make more frequent step-ups. You go to larger dose step-ups so that you can actually get to that what we call the NOAEL limits, the maximum dose that you can actually give based on the tox studies in the shortest possible time. So this is -- one could argue, yes, it's a little bit artificial, but it's designed to be that way because we want to get a rapid determination. Is there something unexpected in terms of safety, in terms of tolerability or efficacy? Are we going to see an early plateau? Are we not going to see the efficacy that you think you should be seeing? Or a safety signal that is not consistent with the class. So those are things we would rather find out early and not take the risk forward. And our hypothesis was, that if you could actually do that in such a setting where you can actually get to a dose that's greater than 20, which by the way, no incretin that I'm aware of has ever gotten to that point in that short period of time. Then we have a significant amount of derisking already done and we can take our molecules confidently forward into Phase II and Phase III. So that was the background in which we operate to get to the data in the fastest way possible. So if you go to the next slide, this will give you a snapshot of the demographic, so -- of the study that was conducted in those two cohorts. So the majority were, in fact, obese, it's a range between -- the BMI range between 35% to 38% or 39%. So a fairly good tight range. By design, these were nondiabetic subjects. So you can see from the A1c, the A1c was around 5.5%, which is essentially in the normal range. And then the age is essentially what you typically see, typically, around the 30s or so. So if you go to the next slide, it gives you a feel for the disposition of each of the cohorts. So at 8 milligrams as we expected, a very benign low dose, everybody pretty much completed the study according to plan. There was no adjustments in dose required. Only one subject in the 8-milligram dose discontinued largely because they had an unexpected pregnancy. They wanted to have an abortion and so this was the patient choice. So obviously, we had a discontinued treatment. In the 22-milligram cohort, we had a total of 31 subjects enrolled, 7 into the placebo, 24 into the active group. And I have to say, I was actually pleasantly surprised to see that even though that we had artificially elevated the doses so high, 83% of people actually completed 24 weeks of treatment at that steep very brisk titration. Four people actually discontinued and they were all unrelated to the study drug. One was withdrawal of consent, one was food poisoning, another one got pregnant, another one just was very noncompliant didn't show up to the clinic. So all unrelated to the study drug. Majority actually completed the study at 22 milligrams, and 5 of them, so that's about 25% of the cohort completed the study on 12 milligrams. So overall, when we actually look at it in the totality of what we did, this was very -- again, further encouraging to us that despite a steep titration a majority actually tolerated this level of dosing very -- really, quite well. So if you go to the next slide, this kind of gives you a flavor of what the weight loss trajectories look like. So again, remember, this study was not designed to look for maximal efficacy. In fact, efficacy was not even the critical endpoint here. But of course, when you use a drug like this, which is highly potent and a dual agonist, you're going to see this level of weight loss. So we see that right away, that whether you titrate slowly, 5 and then just to 8 or you go very aggressively from 5, 8, 12, 17, 22 in that 12-week period, the weight loss trajectory is pretty much more or less the same, roughly around 10% to 12%, which further underscores that going slower doesn't sacrifice efficacy. In fact, one would argue that you probably should go slow, so that you can truly maximize efficacy because ultimately, where people reach the plateau is dictated by the intrinsic property of the drug. It's not about how fast you get there. So this is, again, reassuring and tells us what the field has already taught us very -- many times that going faster or going slower doesn't necessarily dictate the pace of efficacy. The other reassuring thing here was that, as I alluded to earlier, one of the unexpected things that we wanted to rule out was to see if we went to a high dose, do we see an unexpected loss of efficacy or an unexpected plateau that we wouldn't want to see. And in fact, there is no plateau, the weight loss continues in a pretty linear fashion all the way, ultimately ending up right around 19% or so at 24 weeks. Majority of the people, if not all the people achieve the regulatory endpoint of greater than 5% weight loss in 24 weeks and 85% achieved more than 10%. And 10% is, by the way, considered to be a very clinically meaningful threshold. And that's where you start to see disease modification. That's where you can really alter the trajectory of human health because you can start to improve physical function, end organ function, cardiovascular health, kidney disease, et cetera. So to have 85% of people already get there in 6 months, that was actually pretty surprising, at least to me. So this again underscores the significant potency of this mechanism. So now let's go to the next slide, where we can talk a little bit more about the tolerability, which I'm sure is all on everybody's mind. And so I want to help provide a little bit of context here because there's unfortunately, lots of conflation between the purpose of our study and how these are being compared to a Phase III study or even to a marketed compound, which by definition, that would not be a reasonable comparison. So just to walk through the results first and then we'll contextualize. So overall, was reassuring that despite this very brisk up titration, most AEs were mild or moderate in severity. And as I said before, at least to me, it was very reassuring that we did not see any study drug-related discontinuations. Remember, one of the ways of actually knowing whether a drug is tolerable or not is whether they actually want to stay on it. In nausea, vomiting, of course, is there. But if people say, "Look, I don't want to stay on this," that's actually more telling in many ways. So I was reassuring to see that very few, effectively none were related to the study drug itself. So we did see an AE leading to the discontinuation and that was the pregnancy that I alluded to earlier. And of course, when people get pregnant, we have to discontinue them. But that was not a study drug-related event. So again, reassuring to see generally all AEs were mild or moderate with very few severe events. And those severe events were largely because of a food poisoning, which I indicated to you. And then there were 2 cases of a transient increase in creatine kinase. And creatine kinase elevations can happen to anybody really, if you're slightly dehydrated, or you exercise a lot, or you move around a lot, you could see that. So this was a transient increase came back right down. No changes in the dosing was done, again, related to -- noted as unrelated to the study drug. Next slide, please. So now if we break it down by specific, what we call preferred terms. In the preferred term, largely -- not surprisingly, was GI-related. So most GI-related AEs are listed here, ranging from nausea all the way to abdominal pain. So these were the most common ones. And again, every one of these were largely consistent with what has already been seen. So nothing unexpected, nothing that we hadn't ever seen in the class before, nothing that's stood out as, oh, where is this coming, from type of thing. Yes. So when you look at the results, the frequencies are higher when you actually escalate higher, also as expected. When you look at the 8-milligram cohort, we see rates because remember, we started at a fairly high dose of 5 and then we went to 8. So you see the nausea, vomiting, diarrhea, constipation rates as listed there. And then when you compare it to the very rapidly up titrated period, in the day 1 to week 12, all of those correspondingly are increased relative to a much slower gentler rise. And then if you look at the far right side of the column, when the people that reach their "maintenance" and they were maintained over the subsequent 12 weeks, majority again at 22 milligrams, we see in many of them, those AEs tend to improve. For example, in nausea, it goes down from 75% to 33% -- sorry, vomiting goes down from 75% to 33%, nausea goes down from 83% to 54%, et cetera. So you can see that the general pattern overall is no different than any other incretin therapy that has been studied at this stage in development. That's the critical point here to take away, is that at this stage in development in Phase I, when you're rapidly titrating, we're seeing these events. And of course, over the course of time as we slowed the titrations down, and then you can start to get the hint already. When we go to the maintenance period, we are not aggressively titrating anymore. We're starting to see easing up of those events. So just to illustrate this a little bit better graphically. So if you go to the next slide, we've just plotted it for vomiting and we've done the same for nausea and others as well, and we see the same pattern. But just for the sake of illustration, this is the typical pattern that you see, when you go up really fast in the up-titration period, the overall nausea rates can peak up to 50% here, as you see, okay? But each of those peaks correspond to when the most rapid doses were actually administered. So when you go from 12 to 17, 17 to 22, you're seeing those bumps. When you're maintained at 22, you start to ease up on those frequencies. And ultimately, you get to a steady state. In fact, towards the end of dosing, there was barely any further increases. If anything, sometimes you even saw a little dip in the frequency. So overall, the pattern that we see here is, again, no different than what has actually been shown many, many times with other incretins, whether it's monos or duals or triples or any combination you can think of? So again, overall, our interpretation of all of this is that despite the brisk up titration here, we're not uncovering anything that's unexpected. Yes, the frequencies are what they are, and it's consistent with the up-titration period. But in terms of actual events that we're seeing, there is nothing here that is unexpected, that is not seen in the class before. So next slide, please. So to conclude this part of the data presentation for 388, our takeaways here is that, overall very engaging signals here with a robust 12% weight loss in week 12, 19% at week 24. And what was quite reassuring for us because this is exactly what the literature had taught us before, is that when you slow down the pace of titration, it does not meaningfully alter the weight loss trajectory. So we get a lot of questions about whether if you slow that titration down, yes, you might improve the tolerability, but will you compromise efficacy. And our data doesn't suggest that. The literature data actually doesn't suggest that. And you can see that here, right, with 8 milligrams very simple titration, your first 12-week trajectory is almost the same. It's about 10% or so compared to 12%. So 10%, 12% right in that range. So over some period of time as we give more time for the body to equilibrate, we anticipate that the titration will ultimately or the dose will ultimately dictate where we ultimately land up in the plateau. So we need to do the longer-term studies to determine where the plateau actually occurs. And then of course, in terms of the safety tolerability despite this rapid up-titration, it was reassuring to see no unexpected signals. There were no treatment-related discontinuations. We think that the tolerability profile will certainly improve over time as has been demonstrated already by many other incretins. And then quite reassuringly, our data actually supports testing higher doses. As I indicated to you earlier, at least to my awareness, there's not many other studies that have actually shown that you can even go up to these kinds of doses in as short a time as we have done. So all in all, these data certainly warrant for the clinical evaluation of 388. And for that reason, we've already initiated Phase II in July, another addition -- Phase II is going to be started in the fourth quarter. Phase III planning is underway. All right. So this is just to provide some actual data to what I just said. This is a compilation. I'm sure that many of you have probably seen something like this in other formats. But if you actually take a look and we've just selected some relevant ones. So you have your Amgen 133 compound, which is the GLP-1/GIP antagonist. And then you have tirzepatide, which is a GLP-1/GIP agonist and then you've seen our data. So if you look at just the nausea rate, it ranges anywhere from 50% to 80%. When you look at the Phase I data at the highest dose that tirzepatide looked at, nausea was at 50%. It goes down over time to -- in the 20% to 30%. Same pattern with vomiting. So you see high rates of vomiting in tirzepatide as much as 75% of people experienced vomiting, but it goes down over time. Same thing with diarrhea. It can be as high as 40%. And then over time, it improves. So this has been done many, many times. So the point here is that slower titration does improve tolerability, slower titration does not impact efficacy, okay? So this was a poster you can certainly download that as well. So let's switch gears to the oral molecule, another very exciting program for us. So if you go to the next 2 slides, please. Yes. So this one, I just want to pause on this, again, not to mention about the whole obesity thing. But just to underscore one important fact, which is, why is an oral required because we get that question a lot too, it's like, don't you have an injectable isn't that enough. Very excited about the injectable, of course, you saw the data already. But when you really think about the ambitions that we have as a company of really trying to reach the broadest scale and the impact that we can make by altering the trajectory of obesity, we need simpler cost-effective solutions that can actually be applied with that scale. And the one way that you can do that is to actually use a truly synthetic small molecule that, as we talked about, we'll have COGS that can support that kind of campaign. But we don't want to be sacrificing efficacy to get there, right? So the efficacy that we set out to have is a bar was to make sure that the efficacy was as good, if not better than the current injectable mono GLP-1 receptor agonist. So when we embarked on this discovery effort at Carmot, to next slide, please. we have those high bars. So before we get into the data, I want to take literally 1 minute extra here, to provide a little bit of context because most people may not appreciate how difficult it is to actually make a truly synthetic small molecule GLP-1 receptor agonist because if it was easy, we would have done it 10 years ago, okay? It's not that companies haven't tried, okay? People have tried and tried and it's very hard. And the reason is because it's very hard to make sort of solve for two things. The high potency, high selectivity and to have high bioavailability at the same time. You can make a highly potent molecule, it may not be highly bioavailable orally, meaning that your PK may not support a once daily. And in our minds, if you really want to be competitive, you really want to be operating at scale, you'll have to have a once-daily drug that is supported by the pharmacokinetic property, which is essentially the plasma half-life. So we had to solve for both things. We had to make a molecule that's highly potent and highly bioavailable and that's what CT-996 is. And in addition to that, the reason why most GLP-1 agonist today have failed is because it's very difficult to pass through the gauntlets of liver toxicity, right? So you need to have a molecule that has a very low DDI potential, has no reactive species that are formed, and one way to measure the reactive species is through an analyte called glutathione, which is the GSH adduct. Many molecules actually are GSH positive, and GSH positivity means that you might have a risk for liver toxicity. So we had to find a molecule that had all of those properties while having no GSH adduct formation. And 996 is one of those molecules. And then the final gauntlet, which is very hard to pass through is to actually have a molecule that has a tox margin that is sufficiently large enough so that you're not compromised in the clinic to really test high doses early. Because you can always test low doses and convince yourself, "Oh, I don't have liver tox." But you will ultimately find it when you go to Phase II and Phase III. So might as well will find all these things out, and the way to do that is to go very high, very quickly, but you cannot do that if you don't have a tox margin. So we had to actually make sure that we have that, too. So when you really think about all those things, and to see that 996 actually passed all of those bars. At least in my mind, having done drug development for 20 years. This is not a trivial feat. So let's then look at the data that support some of these contentions. So in terms of the potency, we obviously wanted to make sure that we're not compromising on this. So this molecule has sub-nanomolar potency on the human GLP-1 receptor, okay? So you can see these molecules compared to the native hormone, very high potency here. We wanted this molecule to be biased. So you can see in the middle panel here, doesn't have any beta-arrestin activity. In fact, it's 24 weaker on beta-arrestin compared to the native hormone. And then just final on the top right, it shows you what I showed you with our peptides. Same thing, very low internalization compared to the native hormone. In fact, 200-fold weaker internalization, which means that we have a molecule that is essentially no beta-arrestin, keeps the receptor in the on-state longer and perhaps that's one of the reasons why we see such high in-vivo potency and efficacy. And that's shown in the bottom panels there, you can see when monkeys are dosed with either 3, 10 or 30 mgs per kg, you can see in as little as 4 weeks, almost 12% of their body weight being lost. Quite intriguingly to us, and this certainly needs to be repeated in humans. This loss of body weight appears to be preferentially fat mass loss. And you can see in the first red box over there, that there's a very nice dose dependency to the fat mass, whereas the placebo actually had more fat accumulated, which you -- which is consistent because these are obese monkeys. And then if you look at the right box, the second red box, much of that doesn't seem to be driven by -- the weight loss doesn't seem to be driven by the lean mass. So you can see the lean mass is more or less the same as that of the placebo. So this is -- I'm not claiming that this is somehow -- is preserving muscle mass, but certainly intriguing enough to us that this could be on more differentiating factor of this molecule that is worthy to pursue further with. To the next slide, please. So again, this was a study 201, first-in-human, 3-part multi-cohort, Phase I, randomized, double-blind study, which had a SAD part, a MAD part in obese nondiabetics and a MAD part with obese diabetics. The data that we presented at the EASD was from the Part 2, the MAD part with obesity without diabetes. Again, the overall study objective here is to really understand safety and tolerability. It's not designed for looking at efficacy. We don't even use, in fact, the word efficacy, it's more about the pharmacodynamic properties of this molecule. So if you go to the next slide, it shows you kind of the schematic of what we did. So this was done in a single center in Australia, as you would do most Phase I studies. Primary endpoint was safety, tolerability. And you can see in this study, what we did was we actually enrolled about 25 people, randomized them into placebo or active in each cohort. And ultimately, when you broke the blind, what you end up with is roughly around 6 to 7 per cohort, ultimately landing with 4 different groups. So the first group was dosed at 10 milligrams for 1-week and escalated to 30, 60 and 90 each for 1-week. So we call that Cohort 1. Cohort 2 was a much steeper titration, we started with 10, very quickly went to 30 in as little as 4 days. And then we boosted it to 2x, right away to 60 and to 90 and then 120. And then Cohort 3, we did the same thing for the first 7 days, but then we slowed it down a little bit, instead of going 2x, we went to 1.6x and then slowed it down a little bit more from 50 to 80 and then 80 to 120. So the Cohort 3 was slightly slower than Cohort 2. But all in all, fairly aggressive titration here as well with the flexibility provided so as to allow them to reach their target dose with an extra 2 to 3 or 4 days that they need. So go to the next slide, please. As we've already elaborated on the 388, I'm not going to spend the same time here. But again, just the key point here is to emphasize once more that the point of doing these studies is not to maximize efficacy. It is to really derisk early. And because of all the baggages that oral GLP-1 agonists generally carry, it was incumbent upon us to make sure that we are taking a molecule that we're not going to be surprised with that there are no unexpected safety signals or tolerability that we don't already anticipate from an incretin mechanism. So we needed to see that as quickly as possible and the only way of doing that is to push the dose. And as I said before, or at least, as far as I'm aware, we're one of the only few molecules that can afford to go to such a high dose in such a short time because our tox margins will cover that. So if you go to the next slide, demographics, again, very typical of a Phase I study. As I said, each of these Cohorts are broken up into -- broken down into like the 3:1 randomization, as I said, 6 in placebo, 6 in Cohorts 1, 2 and 3. So weight was all in the obese category. BMI, you can see there, range from 33% to 36%. Hemoglobin A1c normal range by design. But because they were all obese, you can also see that they were all insulin resistant with a HOMA-IR of 2 or above. This is the population that you actually want to study. So next slide, please. And so this tells you -- shows you the disposition of the participants. Again, very reassuring to see that 92% of participants actually completed the study despite the titrations that we actually subjected them to. So again, Cohort 1, there was 1 discontinuation, underlying schizophrenia ultimately ended up having a psychotic episode in a domicile setting. This patient should have not been enrolled, unfortunately, but they ended up doing so. So that was just a disqualification of the subject. Cohort 2, we had 1 subject discontinued morbidly obese, 140 kilos diagnosis of sleep apnea, still allowed into the study ended up with a spontaneous right bundle branch block, which usually happens with what is called right heart strain in the setting of sleep apnea, very commonly seen in the -- as an abundance of caution, the PI decided to discontinue that subject. Both of them were unrelated to the study drug. Other than those 2 people, everybody else went through the study, as I said, with a 92% completion rate. And amongst those that completed, Cohort 3 was actually the one that did pretty well overall in terms of Cohort 1 and 3. They all were highly compliant. They followed the titration path exactly as stipulated, and Cohort 3, all of them followed it, excepting for 1 participant, and they ultimately stayed at 50, then completed the study at 10. So that becomes important when we start to look at the data from both the tolerability as well as the safety or the efficacy side of things. So all in all, very encouraged by the number of people who actually continue to study didn't discontinue the study because of a study drug-related issue. Again, as I said before, we anticipated some of that discontinuation quite honestly, because of the very rapid and steep titration that we had subjected them to. So next slide, please. So here is the pharmacodynamic activity, which is weight loss over the 4-week treatment period. So what you see right away is a very stable placebo response. So this is the first thing. At least when I look at weight loss data, I always look at that to see was this done in the right way? Is this consistent with what is available in the literature that I can anchor myself to? And the answer is yes. So roughly in this kind of study design, you see about a 1% to 1.5% reduction in the body weight. So there isn't anything unusual here in the study center or anything that is giving us any pause. So these are the kinds of unusual unexpected things I was talking about earlier that we want to pick up and roll out. The Cohort 1, which was dosed with a very slowly up to 90 milligrams had a 2.3% weight loss change. And then the 2 highest dose Cohorts, 120 milligrams fast, 120 milligrams slow gave you 5.8% and up to 7.3% weight loss. So now people would look at this and say, "Wow, this is in a very small number of people." Yes, it's from a small number of people because that's how Phase I studies are usually done. If you look at all Phase I studies, whether it's tirzepatide or anything else, they're all usually in the same numbers of people between 6 and 9 individuals per cohort, and then you look at the totality of the results. What was really intriguing to us here is, how replicable this data actually is, even if you don't believe the 7.3%, the fact that both doses ultimately kind of ended up in the same kind of range, let's call it, roughly around 6% is, in fact, quite reassuring because how many times can you actually say that you can replicate within the same study, with the same dose, and the same result, very few. So this is actually very good data in our minds because this tells us that in the same study, 2 different cohorts, completely different people. We're seeing good replication of the data, somewhere between 5% to 7% weight loss in a 4-week period is very strong evidence of robust pharmacodynamic activity. Of course, we don't see the plateau, which we don't expect to see that's another thing that we're looking for as the unexpected finding, if you will. And then you can see on the right is the actual graph summarizing, day minus 1 -- day 1 versus day 29. So all in all, very encouraging results with a good solid replication of the efficacy profile -- the pharmacodynamic activity profile. Next slide, please. Because they were all insulin-resistant at baseline, we had an opportunity in this study to interrogate the question of potential improvements in insulin sensitivity, right? Because if this was a drug that could actually help improve insulin sensitivity, then it bodes really well for diabetes as well. And we, of course, know that it will, given that it's a validated mechanism, but it's always good to see the data in your own hands. So you can see day minus 1, which is in light blue, compared to the dark blue, which is post-treatment. So when you compare it before and after, even at the lowest doses, you're seeing fairly robust changes in glucose control, or glucose lowering, I should say. And what was, again, very encouraging here to see is the concomitant reductions in insulin, which tells you that when you have low insulin, low glucose, you're likely changing insulin sensitivity. So again, quite reassuring to see that in a relatively small quick study. Next question -- next slide, please. So this is a very important slide, which is the slide that indicates to us exactly what we were trying to achieve, which is very hard to do, right, which is to get to a plasma half-life that is truly once daily. And so you can see that when we dose whether it's 90 milligrams or 120 milligrams, the terminal half-life ranges somewhere between 17 to 22 hours. And when we line up what's available out there to the best of our knowledge, there's only one other that was, truly oral small molecule that can achieve a PK profile with a half-life that can support once daily. So Cmax and AUC were generally dose proportional. There was no food effect, which is another very, very important thing to check off the box with, which means that you have the flexibility to dose this drug without regards to meals. Many other oral molecules get burdened with the inability to dose with or without a meal. So our data with our PK indicates that we may not have that problem. This is not excreted in the kidney as you can see with very low fractional excretion in the urine over the 24-hour period. Next slide, please. So then coming quickly to the safety and the tolerability side. So here, again, all the AEs that we saw were either mild or moderate. Majority were in fact mild. There were no severe events. There was 1 serious AE that was unrelated to the study drug, which I indicated to you was that psychotic episode that related to the discontinuation as well. But no study drug-related discontinuations we're seeing. Next slide, please. And so when we look at the overall AE profile, again, not surprisingly, the #1 AE category, the preferred term is gastrointestinal. And amongst the gastrointestinal AEs, what you see are the lists provided here, ranging from nausea all the way to decreased appetite. So when you compare Cohort 1, which was slightly slower titration, you can see the vomiting rate is very low. It's 1 out of 6. Constipation, 2 out of 6. The only one that was consistently present was nausea, so was in 5 out of 6 subjects. Now when you go to the Cohort 2, which is the steepest titration, all of those numbers, of course, all of those frequencies are higher as you would expect when you push the dose towards NOL, you are going to see that, as rapidly as possible, you're going to see those kinds of events accumulate. And again, in the same study, just as I told you about the efficacy, when you slow down the titration, you're not compromising the efficacy and you're improving the tolerability. So you're seeing generally, other than nausea, most of these other things going down. The reflux disease goes down, vomiting, constipation, et cetera. So this is already indicating to us within the same study, and certainly, when we go to a longer-term larger study with a slower titration, where we will likely improve the tolerability even more in line with what others have shown. And we would do that without compromising the efficacy. So next slide, please. This again further underscores what I've already said, so I won't belabor it. But just suffice to say, that what was, again, reassuring for us when -- despite this very steep and rapid up-titration, all GIs events, especially the 4 big ones were all mild. The majority -- or actually, I would say, almost all of them accepting for one per cohort. So just one subject per cohort at a moderate event, none of them actually had a severe event. So again, very reassuring to be able to see that in this kind of setting because you expect many more moderate events or at least a few severe events, and we don't see either of those two things. And quite reassuringly as you approach the dosing towards the end of the week or end of the month, 22 and -- days 22 and 29, the frequency goes down even more. So -- and the last slide on the data and then we will take questions. So next slide, please. So in terms of the other findings, generally, otherwise, pretty much unremarkable. There was nothing here that we would not expect of the incretin class. So no other laboratory mitigations, no signals of liver injury. But as I told you earlier, that's very, very important to rule out. There was 1 participant that had an isolated increase in lipase. So lipase is a pancreatic enzyme. It has nothing to do with the liver. It's just something that happens and seen oftentimes with incretins, and we can contextualize that in a second. Other than that, the laboratory findings were pretty much benign. ECG findings also pretty much unremarkable, except for that 1 isolated right bundle branch block. Mean change in systolic blood pressure was around 6 millimeters of mercury. The mean change in heart rate was about 7 beats per minute, again, very consistent with the incretin class, nothing here that is surprising to us. And you can see, just to put this in perspective, when you look at either the triple G, orforglipron or another oral GLP-1 agonist GSBR-1290, all of them almost unanimously report increases in heart rate and that can range from either 3 to 4 beats per minute to as much as 27 beats per minute. Retatrutide actually had even cases of arrhythmia. So these are all things that are seen. It's there, but it's navigable. And that's what other companies have done, that's what we would do as well. The same thing with the lipase, almost universally seen. I mean it's just a natural consequence of GLP-1 activation. So these are all things that we actually, as I said, are expecting to see because this is part of the incretin profile. So next slide, please. And so in summary, I think we don't need to go through this in detail. I think I've summarized it as I've gone along. So let's -- in the interest of time, because we want to make sure that you have a lot of time for questions, I will pause here. Sorry to go over a little bit, but it was important to set the context so that you have all the information so that you can ask us a right questions, and I'm happy to clarify anything further.

Yes. Thanks a lot, Manu, for this recap of the data and also introducing our franchise. And with that, we start the Q&A. And the first question actually goes to Harry Sephton from UBS.

So my first question is on the side effect profile for CT-388. So we've seen in the past, as you showed that with faster titrations, you do see high rates of nausea and vomiting by thinking your study, you could quite clearly see the rates of constipation and diarrhea did seem to be more prominent with CT-388 than we've seen with other studies and that didn't necessarily improve at lower doses. Do you have an explanation for that? Or how manageable do you think that is?

So it's hard to attribute too much weight to that just given the small sample sizes. And the other thing to also notice when we went back and asked is it really diarrhea or loose stools, those two were very hard to separate. So sometimes loose stools get reported as diarrhea. And so in the Phase II studies, we have now incorporated a more formal definition based on the WHO category of what diarrhea really means. So that people don't conflict loose stools with diarrhea. So I think that could have been one of the reasons. But again, we have to be mindful of the fact that these are small studies with relatively small numbers. So 1 or 2 will skew either way. Because it's -- you see the equal rate of diarrhea and constipation. It's a little hard to make sense out of that. Again, so we have noted it, and we will, of course, monitor that and see how that evolves over time. So it's hard to provide any more over-indexing on why we saw more diarrhea or constipation in this study versus others.

And maybe if I could just ask on 996 as well. So for the slower dose titration cohort, there did seem to be limited efficacy on weight loss. So albeit this being in a very small number of patients given the commentary you said around trying to push the titration to the limit on the other cohorts, is the lack of efficacy in that slower titration cohort, a potential issue? Or have you seen anything that sort of better explains why it didn't work so well in that cohort?

So one other thing -- so this is one thing that we are doing right now is to get a much more quantitative understanding of the -- what is called the PK/PD. So one thing that we're learning, and this is probably going to be true for most GLP-1 receptor agonist is that, the exposure that you attain and the duration in which you keep that exposure matters a lot. So one of the things we learned about Cohort 1 is that the exposure threshold was not quite attained. And in those that were attained was maintained for a very short duration of time. But as consistently in Cohorts 2 and 3, we were able to obtain the needed threshold meaning the concentration that you need to achieve in the plasma and maintain that for a substantively longer period of time. So that's why Cohorts 2 and 3 are starting to yield the type of pharmacodynamic activity that we anticipate, whereas Cohort 1 did not achieve that exposure threshold. So that's what we have so far. But we will get to a lot more quantitative understanding as we continue to further analyze and dissect the data. And as we get more data from longer-term studies, that's going to help refine that model as well.

And we move on. The next one is Simon Baker from Redburn.

So just -- I suppose this question really applies to both 388 and 996, particularly 388. You're seeing in the study, almost by design very rapid, very significant weight loss. And we know that the speed of weight loss irrespective of the means by which one is losing weight, has an impact on the split between lean muscle loss and fat loss. Have you got any data for both studies on the mix there? And is that something you're mindful of in terms of thinking of the dosing regimen in Phase II and Phase III about getting to a certain weight loss, but not doing it kind of overnight because of that mix between the two. The second question was on 996. You said there was elevated -- very small elevation in blood pressure. We've seen that with danuglipron and as far as I can tell, this is in the same chemical services as danuglipron, they also saw an impact on pulse. I just wondered if you had seen that with 996. And then my follow one just quickly. You talked about manufacturing at the beginning for 388, it looks like you're going down the Lilly route of solid-phase synthesis rather than de novo route of doing it recombinantly, which I'm guessing has implications -- positive implications to CapEx. If you could shed any light on how you're making this and what the relative investment requirements are for doing this both solid-phase versus recombinant, that would be really helpful.

So let me answer the first two, I'm going to then hand it over to Louis Andre for the third. Very quickly, on the 996, we do see the increase in heart rate. I mentioned that. And sorry, if I glanced over that really quickly, we see blood pressure drop on a mean average basis of around 6 millimeters of mercury. On a mean basis, we see an elevation in the heart rate of around 7 beats per minute. So like you pointed out, yes, it's very much in line with others in the class. So this is not an unexpected finding here. Your first question about the speed, really a great point. It's something that we have taken deeply into consideration in our design and thinking, we agree. This rate of loss of body weight is too much. To lose 2% a week is not required. And in fact, may lead ultimately to other things like lean mass loss, et cetera, that you alluded to as well. So precisely for that reason, we are taking on the path to slow down the titration, which you could do by a lower starting dose, smaller increments of dose step-ups, taking longer for each dose step up. So all of those things have been taken into account in the design of our Phase II study that we're in the midst of. So we will collect that body composition data in those studies because it's sufficient duration to make a meaningful interpretation of. And we anticipate that by slowing things down, we will have an overall improvement both in terms of the quality of the weight loss as well as in the tolerability profile. Louis Andre, anything further to add on that or -- and then please add to the manufacturing question.

Yes. Thank you, Manu. So we do recognize that there will be a requirement for a mix of in-house and external manufacturing for our assets. We don't comment on timing of investments. But what we can say is that we -- the build requirement can be managed within our current existing CapEx, which is around CHF 3.5 billion to CHF 4 billion annual. So this is all we can say at this point.

Maybe to add here from my side, I think we are looking into the different techniques available what you mentioned, peptide synthesis or microbial expression, both possible. Then we take the next question, which questions go to Peter Verdult from Citi.

Peter Verdult here from Citi. Apologies if there's any background noise. Just 2 questions, many thanks for your time. Portfolio strategy and timelines. I think a key takeaway from EASD this week was the rising excitement around Amylin, we're going to see datasets there. So just when you think about the Roche Obesity portfolio going forward, do you have any Amylin assets preclinically? Is this an area you'd like to get involved in? I mean, there are some assets probably available for partnership. Just your level of enthusiasm around Amylin and Roche Obesity there? And then just on timelines, I think senior management at Roche has been in a couple of forums of late saying that launches for these GIP/GLP and Oral GLP could be earlier than '29. I just wanted to kick the tires with you given you lead the program. Is that really realistic? It feels a little bit optimistic to me. So just an update on the timelines that you expect on these 2 assets.

Okay. So regarding the Amylin. So our view is that we are taking a holistic approach to the portfolio. We, of course, feel very confident about the incretin backbone, right? I mean that as the whole point of the Carmot acquisition in the first place, but it is a backbone, and we are fully mindful of the fact that it needs other combos. One of those combos is already in our portfolio, which is the PYY molecule that I just indicated. It doesn't mean that, that's done and dusted and we don't want anything more. We're actively looking at all opportunities, external or internal to ensure that we have the most competitive build of the portfolio that we can. And this is inclusive of Amylin, other gut hormones, other things like energy expenditure modulators, et cetera. So it's a comprehensive approach. Regarding the timeline. So at this point in time, what we can share with you is that we're doing everything we can to accelerate these assets. As Louis André already mentioned, we're already looking into figuring out how we want to do the manufacturing with everything at our disposal. We've already initiated the Phase IIs, those are underway. We are planning on initiating Phase II for 996 already in 2025. So things are in motion. At this point in time, other than the acceleration of the Phase III planning, I cannot provide you any more certainty or guidance in terms of when the launch will be because there are many factors that will be involved there. But rest assured, though, it is being accelerated.

All questions answered, Peter?

Thank you, Bruno. Thank you.

Okay, then we move on. Next question goes to John Priestner, JPMorgan.

John Priestner, JPMorgan. So two on CT-388, please. So for the 22 mg dose, there was a serious adverse event of gastroenteritis or food poisoning. So can you kind of help us understand how that was diagnosed? And is there any extra color you can provide to give us confidence that, that wasn't GLP-1-related given the symptoms would presumably be very similar? And second one on CT-388, so you've spoken about the use of titration to optimize the GI side effects. Can you maybe help us understand just how much you think you can optimize those and how much it can be reduced in terms of titration. I think you showed a very interesting slide on the rates -- on the Phase I rates for tirzepatide. And I think it looks like the CT-388 22 mg dose has slightly higher rates of AEs, so maybe if you did any kind of computational modeling or is there anything you've seen preclinically that gives you confidence in terms of being able to reduce those rates?

Sure. So regarding the gastroenteritis. So this study in 388 was actually that part of the cohort was done in Mexico, endemic for gastroenteritis, unfortunately. And it was very clear in this particular case, the person actually had unfortunately, some spoiled food, the night before, had a really violent reaction to that as I'm sure many of us who have had food poisoning will experience and essentially had to discontinue because it was so bad that they just couldn't even hold anything down. So we just felt that it's just better to just have that person discontinue, feel better and then not have to go through this. So very clear diagnosis and there was no concern at all by the investigator, this was anything else, but food poising event. Titration optimization. So that's the whole point of doing the Phase II studies to try to do a little bit of empirical data as much as we can glean from the literature. And I think I'll try to show that in the slides using examples of tirzepatide as well as the Amgen molecule, because they're both GLP-1/GLP it's just that one is an agonist and other is an antagonist, but still of a "similar mechanism class anyway". And in each of those cases, certainly with tirzepatide because we have the most data on it and we can lean on that data, you see those rates improve. Now as we studied 22 milligrams and we'll continue to explore these doses in Phase II, it doesn't mean that the Phase III dose is going to be 22 milligrams, right? I mean that's the other very important thing to take away from all of this is that the one time we would have the opportunity in drug development to really push the dose is in Phase I and Phase II. So we anticipate and should see more AEs. So just because we see more AEs in Phase I and Phase II doesn't mean that automatically that translates to more AEs in Phase III. So ultimately, what are doses in Phase III, we don't know yet, right? I mean, we're going to -- we have an idea where it needs to be. But the final selection of the dose is going to happen after Phase II. So we have every confidence that the rates qualitatively will improve. I mean you've seen that without exception, in anything that we've seen. I mean I tried pretty hard to see if there was any exception in any of the molecules, and I couldn't find one. Whether you look at glucagon, whether you look at Amylin, GIP, all gut hormones, do the exact same thing. So my answer would be that we feel quite reassured by the fact that even in this study, which was, again, on purpose designed to be artificially elevated risk titration, when we go into the maintenance period, we're already starting to see some hints of the signal. I'm not saying that 50% is still great. It's just that we're looking at 80% versus 50%, 70% versus 30%, et cetera. Directionally, it's moving in the right way. As we optimize the dose, the starting dose going low and slow, I think that's an important principle. We feel very much as an expectation of 388 that it would be improved.

John, did we answer the questions?

Yes, that's very clear. Thank you very much.

Then next one goes to Emily Field from Barclays.

I'll just ask two. The first one is at the beginning of the presentation, that was helpful talking about the hypothesis that the beta arrestin impact could have a beneficial impact on efficacy. But actually, one of the KOLs that we spoke to at EASD thought that, that could perhaps be potentially contributing to some of the nausea seen in the early trials. So I was just wondering if you could comment on that? And then secondly, this is kind of a random one, but I know Carmot was a California-based company, and then 996 study was at a center in Australia, 388 was Australia as well, really far from home. And then you also mentioned that Mexico is endemic for gastroenteritis. So I guess I'm just kind of wondering, why would you then run a study there kind of knowing that. So I guess just sort of why run these studies so far away from home. Just -- I know it's a random question, but thank you.

Sure. I'm happy to take the both of them. So 996 -- sorry, the AE profile with the biased agonist. So that remains a hypothesis, right? So actually, our hypothesis based on the literature and talking to KOLs specifically that have studied GIP in particular, is that GIP actually provides the buffering effect, if you will, on the nausea, right? So if you look at the data from Matt Hayes at University of Pennsylvania, he showed that by giving GIP, you actually dampen nausea. So that's one of the hypothesis is why a GIP agonist with a GLP-1 agonist would be a more suitable combination. We have taken that hypothesis one-step further and made the molecule biased, meaning you could potentially have even greater protection for nausea because you have a GIP signaling now that is further potentiated right, because of the bio-signaling, you're not internalizing the GIP, and in fact, have GIP stay on the membrane longer. So if anything, we hope that it will actually improve the Nausea. And again, to be proven, for sure, but I would submit that in fact, it would be the opposite that we would actually enhance the facts of GIP, whether it's on nausea or on glucose or on weight, whatever it is, we might potentiate the effect above and beyond a non-biased GIP. Regarding the geographies, we operate globally, right? I mean whether it's in Carmot or in Roche certainly, and so when we do these Phase I studies, again, what we're trying to do is stage investments. There's no point in opening large INDs and opening up studies when you're not yet sure about the molecule. So going to a geography like Australia allows us the quick regulatory freedom, if you will, of getting the data that we need to make an informed decision of continued investment or not. And by the way, all of these geographies are well established clinical sites. It's not like you're going off to some foreign land that you are no control over, they're all audited sites by health authorities around the world, GCP controlled and literally almost every pharmaceutical company that I'm aware of, including my previous ones, operated in these geographies. So this is a pretty much a part of the course, I would submit.

Emily, any follow-on?

Thank you.

And the next one in the row is Luisa Hector from Berenberg. Luisa.

Thank you, Bruno. So couple of questions. You're working on the oral GLP-1. Does that mean you're also working on oral GIP? What could we expect there? And then in terms of -- it's very clear, you're accelerating, moving as fast as you can, but obviously, it's an evolving treatment landscape. So I'm just wondering what you're assuming around time of launch, for example, how many orals might be on the market like what's your working assumption? And perhaps I could also ask, is there anything other than your Phase III dose selection, which you would need before starting outcomes trials with broader cardiovascular outcomes and so forth?

Sure. I'll take the first one and three. I'll have Louis André provide some perspectives on the acceleration piece. So regarding the early part of the portfolio, as I mentioned, we are actively working on all aspects of gut hormone biology. And that was a focus at Carmot, that will remain the focus at Roche. So GIP, PYY, Amylin, all of the gut hormones are within our purview right now of investigation and wanting to find the best combos that we possibly can. I cannot speak to where they are in the pipeline right now since they are quite early. But suffice to say, that is all part of the portfolio strategy to really build the best combo complementarities on the incretin backbone. Regarding the Phase III dose selection, that is a critical outcome of a Phase II. We fully anticipate that we will be well informed based on the Phase II studies that we have designed, which are quite extensive. These are relatively large studies, as you may have gathered from the clinicaltrials.gov disclosures that we have roughly around 400 people or so. So these are not small studies by any means. And we feel confident that, that will yield us the dose. We fully anticipate that would be the dose that we would take into the outcome studies as well. There's no reason to think that there will be any sort of type of unexpected reason at this point in time. Now of course, when we see the Phase II results, I might come back and say, we have a different data point there, but it will be data driven for sure. Louis André, want to speak about the acceleration component?

Yes. Thank you. That's a great question. So as Manu mentioned earlier, it's very difficult to say when we're going to be able to launch. But we are doing everything we can to accelerate. We are currently in Phase II with the 2 assets, 868 and 388 and currently, we are aiming at launching in the 2029-plus timeframe. At the moment, it's very difficult to say precisely when that will be.

Luisa, any follow-on questions?

Well, if I can, Bruno. What is the expectation of the marketplace at that time when you do launch? Would you expect other orals to be available and on the oral GIP, so you're not saying that you've tried and it's too hard, just that, that's further behind. And therefore, very much these things are still in the mix. It's not that they've already proven to be too hard.

So I'll have Louis André clarify the first one, but yes, so to your point, yes, these are all in our early research efforts, none of this can be said at this point that we've given up on it or we're not going to pursue it because literally, it's too premature to say that, but it's actively being worked on.

And maybe for the question around the orals, I think it's important to note, we believe the market will be really, really big. If we think about the billions of patients that will be needed in these therapies. We don't believe there is a market for one company, and we think that there is market for multiple players and we believe that by the time we launch, there will be other opportunities with other assets, oral and injectable but we do believe that 996 and 388 are very well positioned to be differentiating and value-adding for patients.

Okay, next one in the row is James Quigley from Goldman Sachs.

Hope you can hear me. James Quigley from Goldman Sachs. I've got 2 questions for you. So first of all, on the conclusion that the dose that really -- or the titration of the dose doesn't really impact the weight loss. Is there any data on the dose intensity for both the 8-milligram cohort and the 22-milligram cohort as you're titrating up? Because it doesn't really look like there was much difference until around about week 7 or 8, which is when the curve started to separate. So is it really fair to include a titration -- to conclude that titration doesn't impact the weight loss for the CT-388? And Is there any other preclinical data that you can talk to that gives you the confidence in terms of the weight loss or that slowing the titration would impact the weight loss significantly or is this slope of the curve of the weight loss? And then secondly, you've spent a lot of time on the call trying to show how some of your assets and your data is similar to competitors. So I'm a little bit confused in terms of where the differentiation is when we saw the first press release [indiscernible] these both assets. The speed of weight loss was impressive, and that seems to support the beta arrestin hypothesis. But if this is just -- if we were now turn the Phase I data is -- was to see how high you can go with the dose when we then go to the Phase II, Phase III and the slope of the curve may be shallower, where is the differentiation? Or where do you hope to see the differentiation? Is it in the combination approach? And if it is, does the speed of the development program of the backbone really matter if the combinations are going to be part of differentiation?

Yes. Okay. So there's 2 points of evidence really that we can point to why the speed of titration really doesn't seem to impact the slope or the trajectory of the weight loss, right? So the first one is the 8-milligram curve and the 22-milligram curve. And so you can sort of appreciate that there isn't much of a difference between 10% and 12%. But I think the stronger evidence is really in the 996 side of things, right? Because there, we have what we call Cohort 2 the 120 milligrams and cohort 3 is also 120 milligrams, but the rate at which Cohort 2 got to 120 milligrams was steeper compared to Cohort 3. And so overall trajectory, yes, I mean, there's some variability because these are small numbers, but overall pattern is not dramatically changing all that much. And then, of course, we can point at the larger dataset. So if you look at the very early studies of semaglutide and the very early studies of tirzepatide, their trajectories in those early studies. Were generally similar whether they went really fast or generally slowed it down. And so ultimately, for us, the point that we're trying to make on the similarities, if you will, is largely on the fact that it's the pattern of the tolerability that we're trying to see. We're not trying to say that this ours is 50% nausea, theirs is 20% or whatever it is, it's simply that the pattern of findings that we're seeing is consistent for this stage of development with other things that are out there. The differentiation will come in various forms. One of them can be the fact that over the period of time with the right titration and the right duration with the right sample size, could we be able to see plateauing not happening at week 36, for example, somewhere around week 36, if you look closely at this [indiscernible], that's when you start to see the break. Within week 36, week 40, it starts to kind of start flattening, if you will. Could we continue that even further. We will get a hint of that when we get to a longer-term study, which is very hard to do in a short-term study. So that's something you've certainly pointed out and we agree with that. The other thing could be their tolerability as well. So remember that this is from 24 people, it is what it is. We are reporting the data as it is. We need to collect more of it. And when we do the titration in the right way, could we actually see better tolerability. That is a really important question that the Phase II is actually designed to answer that. And if we start to see that, that could be a differentiation, and we would link that back to the biased GIP that I alluded to with the previous question that was asked. The final piece is, yes, of course, combinations are going to be a component of that. And that doesn't preclude us from testing the backbone. You cannot do a combo study without actually demonstrating that your backbone does, in fact, provide that efficacy and the tolerability that you want. And you have to know what your dose of your backbone is going to be right? I mean we don't want to guess that. We want to be very empirically data-driven on that specific point. So regardless of whether the combos will become part of our later differentiation, which we certainly anticipate it would, we have to do this monotherapy study, if you will first. Hopefully, that provides a little bit more context, but happy to clarify.

And just to clarify on -- Again, on the curves, the 388 in the 8 milligram and 22 milligram. It was more a question of dose intensity because if you look at the step-up dosing, you hit 8 milligrams slightly quickly for the 8-milligram group. So in terms of the cumulative dose exposure, it looks pretty similar until week 7, which that makes sense in terms of why the curves are hugging. But if you had a similar step-up dose for the 8-milligram as you did to 22 milligram, surely, that wouldn't happen. So that's what I'm trying to sort of get my head around in terms of the conclusion that the titration doesn't really matter into the weight loss.

Well, so what I was alluding to was the shape of the 22-milligram curve, one would have anticipated much more separation at week 12, right? Because we got to an exposure with a high dose that should have made the curve much more. So the fact that you're increasing the speed of titration and you're still kind of getting the same level of the trajectory tells us that probably the speed per se may not really matter at the end of the day, the exposure of the drug might matter more. But the best example, as I said, about the titration differences is in cohorts 2 and 3 of the 996 because they're both at the same dose. The final target dose was 120, the speed at which you got to the 120 was different. So again, we would be the first one to say small numbers, and we need to take this all over a grain of salt. But the data from the literature continues to support what I just said. And our Phase II data will continue to provide more specific data on 388 itself.

Perfect. And Bruno, can I slip 1 more in, Bruno, sorry. On the heart rate increases -- sorry, I know we're out of time. On the heart rate increases, I mean, you've shown that it's in the same rule as -- then ballpark of retatrutide, and orforglipron but obviously, the other GLP-1s and it was mentioned in the -- in your session at the EASD that it's 2 to 4 that we've seen with the other GLP-1. So in terms of the dose modifications and dose titrations, how confident are you that you could potentially get into the 2 to 4 range? Or is 7 around about where you think to land based on what you saw with -- what we've seen with orforglipron?

So first of all, I think the heart rate change it's to us is, again, completely on target. It's at 3 beats per minute or 7 beats per minute. It's very hard to separate that in a smaller study. And there are many confounding factors to why you see the heat rate change at all, right? So heart rate can be on target, of course, to the GLP-1 physiology. But it could also be maybe precipitated by a more steep drop in blood pressure. But we did see that, right? I mean so we saw roughly around a mean of 6 to 7 millimeters of mercury drop in blood pressure. And sometimes the compensation for that blood pressure is to increase your heart rate. There may have been other confounding factors, which is very hard to tell. So I think, again, this is a data point, note it now, but nothing here that is surprising to us. Longer-term studies will ultimately layer out where we will land. Whether we land at 2 beats per minute or 4 beats per minute, it's hard to predict. But whatever it is going to be, what we do know from the incretin literature that the hard rate per se doesn't really impact the outcomes. So you have everything from dulaglutide, which has probably one of the highest heart rates, there is 7 to 8 bps per minute to retatrutide, which actually causes arrhythmias. So I think the consensus of the field as best as I can understand it, is that you actually kind of look at the heart rate as part of the kind of tolerability and the safety aspect of it, but it's not really something that is concerning enough that impacts your outcomes.

Next question will go to Rajesh Kumar from HSBC.

Manu, I appreciate that you said these trials were designed to fail fast if you had to fail. What are the chances that you look back when you're in Phase III and said that this tolerability profile should have caused us to decide to fail at this stage, i.e., have you done a hindsight analysis of you are making a decision to move ahead. I know these are small sample sizes, and you've made a very fair point that comparing it with Phase III trial data on adverse events and tolerability can lead to completely misleading judgments and I get that. But I'm just asking that how have you made that decision to move ahead to Phase II after looking at the data? Were there any scenario where you said shall we kill this now? And you decided not to -- so what was the choice calculus around that? If you can elaborate that's what we would really appreciate. Second question is on we are looking at really small numbers and percent calculation on 6, 7 patients that's a stock broker land. I'm sure that's not a scientist land. So I'm not going to even go there. But how do you think about the risk that when you go to Phase II, what are you doing in patient recruitment criteria to ensure that motivated patients are coming into your Phase II trials so that you don't see churn due to other reasons. We have seen in obesity trials that patient churn can set programs back quite a lot. You've seen in the case of another asset, which I'm not going to name, but I'm sure you are aware of which one I'm talking about.

Great. So thank you for the first question. I really appreciate that you asked that. So there were very specific no-go criteria, as I alluded to in the introduction to the 996, it's incredibly hard to make a safe oral GLP-1 agonist, right? So our kill criteria was that if we did not see a half-life that would support a once daily, meaning if we saw like a 4- to 6-hour half-life, I think we would have stopped it because that's not going to be competitive in our view because we need this to be QD, once daily and once daily by PK was really, really important because that reflects that you have sufficient bioavailability to give you sufficient exposure, to give you sufficient efficacy. So that's -- if you saw that, we would have been done. We didn't see that. If we had seen in the preclinical settings, positive signals of liver toxicity, I mentioned glutathion metabolize. If we saw that positivity, we would have been done. We didn't see that. If we had seen that this was not a potent molecule with no in-vivo activity, we would have been done. So it's not that we kind of hurdle down quickly to a Phase I study and said, okay, let's see what happens. They were very careful quantitative thoughtful considerations to make sure that we're not taking even into Phase I. There's no point in exposing any human volunteers to a medicine that you think will have no shot at all. So there is nothing there that we would have looked at that if any of those things were positive, we would have been done. Those are what we call intrinsic properties. Those are properties that you cannot will yourself and hope yourself will go away. So that's what we call the intrinsic property of the drug. So it's there or not there. The rest of it is all a function of how the study is designed, nausea, vomiting, heart rate, all that is modulatable. Those are not things that we would say, "Oh, that's a no go". Because we all know, everybody on this call knows that, that is all a complete function of how you titrate, what dose you go to, how much you stress the system, if you will. Think about that like a stress test. So that's what we did. We are obviously not going to do that stress testing Phase II because we've already done that and passed in my view, in flying colors. So now in Phase II, the focus will be fine-tuning, tweaking. We feel very good about the intrinsic property of the drug. As I said, you cannot change then will, somehow the half-life is going to get better. You cannot will that the [indiscernible] metabolizes and is going to go away. Those things are not going to be the case. So I think when you really think about it very objectively on what we actually have and what we had to go through and the gauntlet that we had to pass through, that is the reason why we are confident to go to Phase II. It's not just based on 6 people. Now of course, all studies in Phase I use this paradigm. So what we have done is no different than any company that I've worked in has done, right? So a very, very typical Phase I program. You do your SAD study, you do your MAD study and then you make a decision. Okay, I'm going to go to Phase II. Phase II doesn't mean it's a pivotal study. If we see something that's unusual in Phase II, we still have an opportunity to say, okay, maybe we don't make that large investment to go to phase III. So that's why we go in phases and these are staged investments by definition. So hopefully, that provides greater clarity for that. Your second question was Phase II to Phase III?

No, in Phase II, what is the recruitment criteria?

Yes. Yes. So this is a pretty standard sort of recruitment criteria. You're right. We don't want to go to site that will delay us. So site selection, recruitment, retention, these are all kind of bread and butter of our clinical operations folks. I have no question at all. I have the greatest confidence in our clinical operations colleagues. They've done this kind of studies, hundreds, thousands of times. So this is not something that is even on my mind, quite honestly. But yes, point noted site selection is critical. That is all the kind of key considerations that our clinical ops people take into account. And of course, the speed of recruitment matters a lot. And that is one of the reasons why we cannot sort of foretell and give you specific guidance of when the Phase II is going to read out, we can do that perhaps once we actually formally start the Phase II studies.

Yes. And then the first question probably was slightly misunderstood. So the way I was going is building on James's question earlier. Basically, you want to fill a product if you're not going to make a commercial return, right? And the scientific criteria is great. You have that. But the differentiation is not going to be the speed of weight loss, it's probably going to be a combination. You already have bimagrumab by Eli Lilly, which is a myostatin which is further up in development. You already have other myostatins which are ahead of the curve. You already have approved weight loss. So basically, the thing is, do you see enough differentiation here that it was a go ahead rather than a go/no-go decision. So what are the commercial calculus there?

So thanks for allowing me to clarify further. So the basic calculus was that, in our view, there isn't that many oral agents other than one that I can name that is truly meeting the kind of bars that we just start talking about. Most our peptides that are converted to an oral, you are going to have the same issue with the COGS and all these other things that we have to deal with peptides about. We're talking about a truly synthetic small molecule oral GLP-1 agonist. And in our assessment of the field at this point in time when using objective criteria, yes, it's scientific, but we have to be scientific about this. There isn't any that really meets all these bars other than one. So the market space that we're going to be launching into, as we've alluded to many times, with about 3 billion people that could potentially be overweight or obese with many co-morbidities. We think it's a more obligation to bring these things forward. It's almost impossible not to bring them forward. It cannot be just 1 or 2 companies that are supplying the world's medicines for all these people. So differentiation, I understand where you're coming from, but we're also looking at it from a purely a patient-service approach, right? I mean there are so many people with so many of these needs. And you need small molecules that can provide these kinds of solutions. So I'm not sure that I would submit to the fact that if you don't win on weight loss by x percent or win on the nausea by y percent, then this is not differentiated. I think you have to look at the whole picture. What is the patient experience? How do they get access to these medicines. What does this KLN reach in which that these medicines can be delivered? What are some of the ways that they can actually maintain their weight. We actually view oral medicines as weight maintenance therapies as well. So it's not a simplistic one size fits all, and it's very hard to box all these things into that. I know that people like to do that, so you can kind of do your models. But drug development is very complex and messy and taking care of patients is even more complex and messy. So I think we have to look at the broader picture. That's kind of what I would say.

We'll move on. Next on the row is Emmanuel Papadakis from Deutsche Bank.

I'll keep it very short with the time. Apologies if I missed this, the Phase II, have you told us or can you tell us anything about the titration regimen and the maintenance dose? Are you stepping up something above 20 mgs over 8 weeks? Or is it materially different to? What is the design across the 5 active arms? And then a quick one on the potential Phase III program, would you contemplate doing an active comparator you firmly set on doing it versus placebo?

So at this point in time, we haven't given the details of what our doses are, we will work those things out, and then we'll come back at the right time. But it is a wide-dose range, starting, as I said, from a very low dose to a high dose with various different kinds of titration steps. So we will have both the dimensions of dose, speed and the timing worked out. And this is true for both of our Phase II studies, one in diabetics and one in nondiabetics. In terms of the Phase III, can you just remind me what the question was again?

Placebo or active comparator?

Placebo and the active. Yes. So I think both are under consideration right now. So we can't -- obviously, I cannot give you the detail, but the envision of pretty robust Phase III program, right? So for all the things you guys have mentioned, comparative landscape, et cetera, we are prepared to handle that competition. And so we need a package that will support that. So it has to be a robust study. So there will be more details that will come once we actually have got the Phase IIIs nailed down, but I think we can anticipate placebo-controlled studies, active comparator studies, all of that will be in the considerations in the mix.

Then next one is Sachin Jain from Bank of America.

Just 2. On the 388 Phase II you started, you referenced interim data in '25. Could you just comment on the duration of follow-up you're looking for at that interim stage and whether you would be willing to make a Phase III decision on interim or we have to wait for final data? The second question is just to clarify the differentiation. You were very clear in the prior answer talking about 996 being a small molecule. I wonder if you could just provide the same framework on 388. Is there any aspect of this portfolio you think is differentiated beyond efficacy or GI tox? Or are we looking for differentiated efficacy GI? And then just a third quick one. On 388, you've given the vomiting rates by titration and maintenance phase. And in the maintenance phase, once you've sort of 3 titration, the vomiting is still at roughly 10%. I think for Wegovy in that pooled analysis, that's down as low as 2% to 3%. So what I'm trying to understand is whether slower titration can impact the vomiting rates in the maintenance phase. It seems intuitively can't. So I just want to make sure and understand that.

So let me start with the third question. I will hand over the first question to Louis André. So in terms of the maintenance phase, it's very important to remember that we already started at a very high titration level. right? So you've already set the frequency and the prevalence, sorry, the case rates, if you will, in motion already by the time, the way we started it. And so the lowering, if you will, is not going to be that dramatic because you've started high, stepped up high and you maintained it high. right? And so it's just not an apples-to-apples comparison. You can -- as I said before, we cannot compare our Phase III results in whatever shape or form to Phase I results, whether it's in active titration phase or in a maintenance phase because both of those phases are in this sort of very artificial setting in some ways. I hope that helps clarify that piece. The second is you said about the Phase II design. Is that correct? Did I catch that?

Yes, just timing of -- sorry, duration of follow-up for the interims we can gauge when interim would come and whether interims enough to make a Phase III decision?

Louis André, do you want to quickly comment on that one?

So yes, so it's a great question. So we're currently evaluating an interim analysis in 2025, but we don't have all the details right now about this, but this is something that we will use internally to make a decision for Phase III. This is not something we're going to share. I think we're going to wait until the final analysis of the Phase II later in 2026. So this will be presented. But the interim is more for internal decision-making.

And sorry, what was your first question?

You'd commented on 996 being differentiated on being one of any other small molecules. I was just trying to get a similar parameter for 388. So beyond efficacy and nausea, where do you see this is differentiated? Or is it differentiated on efficacy and nausea?

So based on the hypothesis, right, which we have kind of tested and proven in preclinical models. We do need to do that experiment in human studies. So the Phase II is going to be that experiment essentially. That will give us a view into what is that efficacy trajectory look like? What is that efficacy profile or tolerability profile ultimately look like. So we will be able to answer the question of true efficacy, tolerability differentiation once we actually get the data in the right settings. At this point in time, we have -- we can only point to the preclinical data and when we've done our comparisons against what we call the unbiased molecules compared to the biased molecules. The bias molecules tend to typically do better pretty consistently in all measures of efficacy. So glucose, weight loss, duration of maintenance or weight loss et cetera. So that's the data that we currently have. I shared a little bit of that with you. But the human experiment is currently underway.

So can I take 1 follow-up. So what's your target profile for 388 at 52 weeks. Other companies throughout weight loss and sort of GI profiles of 52 weeks. Do you have a target profile in mind?

Louis André, do you want to comment on that one? .

So we do have a very, very tentative hypothetical 20% to 25% weight loss at 1 year, but this is, of course, something we'll have to evaluate in Phase II. And we expect a profile that will be well tolerated.

And just to build on that, I would say, based on the data that we currently have, I think we can say that the 20% to 25% is what the trajectory should do, but again, we will need to do some modeling even after the interim analysis is done where we can further refine where is it? Is it kind of north of 20%, north of 25%. That's something that we will get a little bit more handle on after we get some more data. But based on just purely current trajectories, it's in preliminary sort of analysis. It's that kind of range essentially.

Okay. Then we have a final [indiscernible] more questions. Ben Jackson from Jefferies.

Perfect. Keeping very short, just given the timing, a little bit earlier thinking for you. The fail-fast approach that you've used here, do you think you'll continue to use that approach for future assets? Or given the increasing interest in the early-stage readouts, will that make you reconsider how far you push the boundaries in these early stages? And then, I guess, separately, on the PYY asset that you've touched on very briefly today. Is there anything there that you've seen in the preclinical studies or whilst designing the drug that perhaps builds confidence in its potential, I guess what I'm trying to look to do here is understand whether there's something you bring into clinic due to a novel tweet that's been made before, especially when we look across the many PYY molecules that so far have been discontinued by competitors with many highlighting high rates of nausea, given the biological mechanism of the PYY compound.

Yes, great, thanks for those 2 questions. So fail-fast. So our approach in early development is generally you want to work on the things that have the highest impact. It's an opportunity cost for us to work on things that are not going to yield the type of profiles that we want. And so we can always -- would have always designed our studies to mimic what's there in the literature or knowing that going slow and low would be better. But that's not going to serve the purpose of what we are trying to do. We're trying to bring the most transformative life-changing medicines to patients as quickly as possible. I have no interest in developing medicines that will not do that. So at least as far as development is concerned, we want to be mindful of making sure that we're bringing things to patients that are really going to change their lives. We're not interested to just do something just to make ourselves feel better for a little while, only to find out later that, that doesn't really meet the bar. So to me, the fail-fast is more of a philosophy. It's not what we're trying to do, just sort of -- just to do it, right? It's what we really owe our patients for. Second of all, PYY. So yes, it's almost a graveyard, right? I mean people have been tried and failed largely because of the nausea. So we knew about that. So when we embarked on the discovery effort of that molecule at Carmot, very mindful of that fact. And so I cannot get into the specific details, but suffice to say, the design attributes have accounted for that is the [indiscernible] that we have tried to solve for. So our preclinical data, which I cannot get into details with generally shows that there may be a differentiation that there's a profile here that is unique and different than what is out there or what was out there. And of course, the proof of the pudding will be when we take that into the clinic, which we plan to do in 2025.

Okay. With that, I think we are at the end of today's call. I would like to thank again our speakers, Manu and Louis André, for the preparation and also from the IR team, Julia Bräuer and Sabine Borngräber for preparation. You will have, I think, another opportunity to meet Manu end of the month in London at our Pharma Day event, If you join. And with that, I'm wishing you a good evening and a nice weekend. Bye-bye.