Sionna Therapeutics, Inc. (SION) Earnings Call Transcript & Summary

Welcome to the third day of the Citi Global Healthcare Conference. So my name is Geoff Meacham, the senior biopharma analyst here, and we have Sionna with us on stage. So we have Mike, CEO; Elena, CFO.

And Charlotte McKee.

Yes. So welcome. I mean maybe just to kick it off, Mike, just give us like the 2-minute type of elevator pitch. I mean I know the category, you guys do, too, but I think for those on the webcast, maybe for a bit of a background.

Yes, happy to, Geoff. And first, thanks for having us. Great to see you, and thanks for Citi for inviting us today. So Sionna, we are focused on cystic fibrosis, and we are attacking cystic fibrosis in a different way. We're going after a differentiated target called NBD1. It's not a new target that's been well studied, but it has long been considered this undruggable target. So we have this very differentiated approach. And our vision really is to transform the standard of care in CF with NBD1 being the anchor to that strategy. As I'm sure we'll get into -- we have recently entered our Phase IIa proof-of-concept study with one of our NBD1 stabilizers, SION-719, that we're going to add that on top of TRIKAFTA, the standard of care in a proof-of-concept study to show that NBD1 is mechanistically different from the components of TRIKAFTA and that we can also improve CFTR function as measured by sweat chloride, a very important first step for us in the clinic. First time NBD1 is going to be tested in CF patients, and we expect that data in mid-'26. So that's one path with the add-on approach with 719. And then our second NB1 stabilizer, SION-451 is the anchor to our dual combination strategy, where we're combining 451 with two other complementary mechanisms to test the safety tolerability and the PK profiles of our dual combinations with the ultimate goal of selecting the best dual combo that we would progress forward. That dual combination strategy is our prioritized approach. We think that's ultimately the best profile for patients. We have the potential to add meaningful clinical benefit above the standard of care with just two compounds. And as many folks know, the standard of care today is a triple combination, three different correctors coming together. So we have an opportunity to do something very, very different with our dual combination approach, and we also have that data in mid '26. So very important time ahead of us, right? The strategy is playing out, and we have some data coming mid next year. But we're really well positioned the IPO we did in February of this year. We raised $219 million, brought in some great new investors and that has really set us up to have capital into 2028. So beyond those catalysts that we have next year and gives us a lot of financial flexibility to execute the strategy. We've got a great team, we've got a Elena and Charlotte here with me today. But a great team back in Boston as well. So super excited to hear more about the story.

Yes. Let's take a step back before we start talking about the pipeline and the mechanism and obviously, the CF population, the sort of technology platform, the kind of the R&D platform. Talk a little bit about how you think Sionna is doing something unique and NBD1 focus is unique, but the kind of the discovery engine that you could backfill a number of assets in the pipeline with?

Yes. So if you think about our strategy, and NBD1 is really is starting there, we can get into further with the rest of the portfolio and how the research strategy, but maybe even go step back to history here, which is important, right? Because if you think about NBD1 not being a new target, and it has been considered this undruggable, holy grail target of CFTR correction, well known and have been studied by other companies, but it was given this label because it was very challenging to drug. Very, very shallow binding pockets exist around NBD1, and that's why it got the label as undruggable. We are where we are today at Sionna in the clinic with multiple compounds, others even earlier in the portfolio and in the research engine because of the history. The legacy of Sionna, we spun out of Sanofi back in 2019 but the science behind our programs goes all the way back to Genzyme. Over 15 years ago is when these programs originated and the science behind them. We wouldn't be where we are today without that legacy of Genzyme that carried forward into Sanofi and then when we spun out, we were a dedicated CF-only company that could then advance these compounds in a way that was different than within big pharma. When you're competing for resources and trying to prioritize these compounds versus others. But it's that -- leveraging that history, the level of investment, the perseverance that it took prior to Sionna spinning out is really important because we often get asked, "How did Sionna crack the code on NBD1, when you've got other companies that haven't been able to do that?", again, we wouldn't be where we are today without that effort that took place prior to Sionna, and we think it's one of those opportunities that shows the benefit of starting in big pharma rolling out into small biotech as a dedicated small CF-only company that has put us in that position. And then when we think about the research engine, you're kind of referencing we've got NBD1 as sort of our core differentiator, but we're also in our portfolio of complementary mechanisms some that we in-licensed from AbbVie, some that we've developed internally that gives us an opportunity. We really have a franchise of CF options that when you can put them in various combinations with the ultimate goal for us is to raise the efficacy bar. We want to raise the efficacy bar through the combinations that we put together to create new, compelling options for patients, and we think there's room in this $12 billion market today in CF that's growing to $15 billion. We think creating more and different options for patients would be really beneficial and obviously, a very significant commercial opportunity.

One of the first approach is adding on to standard of care. So talk a little bit about what you guys view as the unmet need or the opportunity to further expand standard and then we'll talk about you and your individual assets.

Yes, I'll let Charlotte talk about the unmet need and how we want to approach that.

Yes. As important and impactful as the current modulators have been, we know from real-world data that as many as 2/3 or more of patients on the standard of care don't yet have normal CFTR function as measured by sweat chloride. And really more and more we strongly believe and we hear from the community, too, that, that really should be the goal. And so we do believe -- and if you look across the history of the modulators as they've been developed in waves, the lower or the better the CFTR function can be, the more that has flowed through to both short-term and long-term clinical benefits. So that's really what we're driving for. And we do believe that NBD1 stabilization is really the key to moving more patients to normal CFTR function.

That makes sense. Have you guys done market research in terms of the patients that are on a modular today, the ones that are suboptimal responders or the dropout of therapy, the reasons why and maybe that could help guide kind of how your product portfolio going forward?

Yes. I'll talk real quick and then I'll turn it to Elena to get into that specific question, Geoff. But I'd say if you go up a level, and what is our target population, right? Yes, there are patients today that maybe drop off the standard of care or have other challenges that we could definitely support going forward. Our goal really is to go after the same patient population as the standard of care. We expect our label would look very similar that this would be for all patients that have F508del mutation, which is 85% to 90% of patients have a form of that. And so we want to have as broad an opportunity to impact those patients. For the reason Charlotte said, 2/3 of those patients on the standard of care are not at normal CFTR function. That's ultimately the goal we should be striving for. And I think interestingly, Vertex says the same thing. We are fully aligned with Vertex on that messaging point, which is we should be striving to get as many patients to normal CFTR function as possible. But Elena, do you want to get a little bit into the details?

Yes. So when we do market research, we're really testing that target profile that we think we can deliver, which is a dual therapy, that's our proprietary dual that could deliver above and beyond the standard of care from an efficacy perspective and be potentially differentiated from a tolerability perspective as well because it's two drugs instead of three. And when we test that profile, there is a lot of enthusiasm for something new in this broad population. We don't hear that would be specific to nonresponders. There's just general enthusiasm that, that would be a very compelling product profile for patients and physicians.

No, it's just interesting that you have all the Phase III data for, say, TRIKAFTA and for ALYFTREK, but in the real world, may have a different experience. And you just don't hear about that, right, from a lot of pulmonologists that maybe for various reasons like patients can't tolerate the highest dose, so they don't get the FEV1 that was promised. So Charlotte, you mentioned sweat chloride, so is that becoming more of a metric like in the community to help sort of put a patients kind of where they are from a maintenance perspective?

So I think it's still more of a research tool. And definitely, the experience with the modulators has highlighted the importance of sweat chloride as a really important clinical biomarker. Of course, all through the approved modulators which I had the privilege of being a big part of all through the approved modulators, sweat chloride was a really important secondary and supportive endpoint. So that will -- we see that as continuing. I think we see still the opportunity to actually potentially improve FEV1 as well. And then in the long term, some of those other longer-term outcomes like pulmonary exacerbations, et cetera. And so we do believe that FEV1 lung function will still remain the registration endpoint and sort of the primary endpoint, and that's really what we're striving to improve by improving CFTR function substantially versus the standard of care.

That makes sense. And Mike, you talked about the strategy here with the add-on and then the ability to move up on the efficacy and improve the profile. So talk a little bit about the selection process between 719 and 451? What attributes of the compounds kind of drove your decisions of one path versus another?

Yes, we were really pleased when we ran the Phase I studies for both 719 and 451. We were expecting that maybe one would rise to the top, and we would just pick that one NB1 stabilizer, and we would advance it into our clinical development strategy, which was always contemplating as the first proof of concept to add on top of the standard of care while we were also in parallel going to be developing that dual combination approach. When we got the data, what was -- we were really pleased with is from a tolerability safety perspective, there really was no separation between 719 and 451 in a positive way. They are both generally safe and well tolerated, and we are fortunate that, that wasn't a differentiator for either one of them. And then when we look at the PK. So when we went into the Phase I, we have set two distinct targets, leveraging our CFHBE assay. We had set very distinct exposure targets that we needed to achieve in the Phase I for both compounds. We had set one target which was based on the add-on approach. If we add NBD1 to the standard of care, there is a lower target for that because NBD1 now is the fourth compound being added to this combination. And these -- they all synergize and work well together. So we had a lower target of exposure for an add-on. And then when we had a higher target for our own proprietary dual combination, which, again, is just the two drugs with NBD1 being the anchor. And in the 2-drug combination, we need more exposure of NBD1 because it has to do more of the work in a dual combination than it does in the quad. So the -- when we looked at the data for 719 and 451, both compounds exceeded the add-on target at every dose we tested. And similarly, both compounds exceeded the dual combination at every dose we tested accept the lowest doses. So there was -- you could have picked either one of these compounds to advance as both an add-on and the dual. But when we really started to pull apart the PK, what we started to see was there's some unique differentiation between the two compounds that we think we can leverage in a way that best supports that clinical strategy. And so we picked 719 as the add-on really because at the lower doses of 719. 719 is a little bit more potent than 451 and we knew that, but where it really manifested itself was at these lower doses. We got higher exposure at lower doses of 719 relative to the target. So we got higher above the target with 719 as an add-on at the lower doses than we did at 451. So even though 451 exceeded that target, 719 exceeded it by more. And so we felt like why would we not pick the best compound for the add-on at the lowest doses that are going to drive the highest efficacy, it really was the best option we had for the add-on. The converse of that is when we looked at the dual combination. 451 actually achieved higher exposure at the highest doses we tested relative to 79. And so we got higher above the dual combination target with 451 than we did with 719. And so again, we really tried to pick the best compound that would best support the individual paths as opposed to feeling like, well, we just need to pick one, we just need to pick one compound and advance them. So we really leverage those unique PK profile differences and I'd say the added benefit of that, just from a strategic optionality perspective, having two different compounds advancing 719 is the add-on and 451 as the dual combination. It does create a lot of flexibility for us as to how we think about positioning and advancing these compounds because as you referenced earlier, Geoff, our prioritized path is the dual combination and that add-on as of right now is meant to be a proof-of-concept study but that path as an add-on, we could continue that path beyond the proof of concept. If the data was positive, it's really more of a capital question. Can we raise enough capital to pursue both paths in parallel. And so we don't have to make that decision now. We want to see that Phase IIa data and then see what the capital markets are at, at that point. And if we have a positive study and the capital is there, that would absolutely be something we could consider doing and having these two different compounds going into different directions just gives us that optionality.

Yes. Let's talk about that a little bit. So 719, the timeline for data and then maybe -- and you guys view like what does success look like that maybe will inform your decision to raise capital and to go into a larger study?

Yes. Do you want to talk about the study, Charlotte and then what we're looking for?

Yes. Our goal, as Mike said, really was a proof of concept, proof of mechanism study. Efficient, we wanted to read out in a relatively short period of time. So we're able to leverage, you mentioned sweat chloride Clad, we're able to measure and leverage sweat chloride is primary activity readout of that. It's a 2-week study and a 2-way crossover. We can do that in -- we're well powered for at least a 10 millimole per liter change in sweat chloride with under 20 patients on top of stable TRIKAFTA. So that really is the bar. That 10 millimole per liter change in sweat chloride above and beyond TRIKAFTA is really our bar. And we think that, that would put us in a position to truly differentiate versus anything that's been shown versus standard of care and really then allow us to correlate back to our CFHBE assay. Yes.

In sort of the stability the patients on TRIKAFTA -- I'm assuming that they have to be on drug for an extended period and maybe they can't have a lot of sweat chloride variability from like time point? I just -- maybe help us with like kind of the lead into that.

Yes. So another nice thing about sweat chloride is it is pretty stable over time in general. So that you don't need to select all patients who have stable sweat chlorides in general. But we do have eligibility criteria for them to have been on a stable dose even before they start in the study. And then we also have a 2-week run-in period just so that we're absolutely sure we know exactly what their baseline is on TRIKAFTA. So we get to leverage a lot of the characteristics of that.

Just given your experience with these compounds, is there a direct correlation between whatever points of sweat chloride could translate to x points of FEV1? Is it -- if you had 10 or 20, does that mean like a 2 or 3 points of FEV1?

Yes. So you're right. Over the course -- again, if you look over the course of the modulators, there has been a really nice correlation at a population level, study level between improvements in sweat chloride and improvements in remarkably up to the current point that, that correlation has been remarkably linear. We weather that remains strictly linear from now on, all the way up to normal CFTR function, we hope to be the ones to probe that and to test that. But we're pretty confident based on the data that if we can improve sweat chloride CFTR function substantially. And for us, that's at least a 10 millimole per liter change in sweat chloride, we believe there is the opportunity to improve FEV1 as well along with that.

And what we've said, Geoff, is that 10, if we can deliver 10, we think that would equate to something like 3 points of FEV1 to your question, in the future, right? That proof-of-concept study is not an FEV1 study. Just given the way it's designed, it's really designed for sweat chloride. But if we hit that 10 millimole sweat chloride number, it would give us, again, that confidence that we will deliver FEV1 in the future, somewhere in that neighborhood of 3. As Charlotte said, that's been the pattern when you look back over the approved modulators that if you get into that double-digit realm, you can start to see that correlation. When you're below that, when you're in sort of single digits of sweat chloride, sometimes it has shown FEV1 correlation and other times not, right, just equally as many times. So we want to be outside the noise. That's why we picked that 10 millimoles to be outside that noise and leverage the history of these modulators. But we also know we've done research, right? We've talked to physicians, and we've asked them what is clinically meaningful benefit above the standard of care? What would be meaningful to you that would get you excited about a new option? And consistently, what comes back when we engage the community is 10 millimoles sweat chloride an improvement, but we also want to see incremental FEV1 improvement. And that 3 points, again, is where that clinically meaningful bar tends to get set. Anything above that, even better. We know if we deliver on that proof of concept at least 10 millimoles of sweat chloride, that is clinically meaningful and that would be a win.

I mean, CF drugs used to be approved on a 2% FEV1, right? So prior to Vertex. Let's talk a little bit about the dual combination. So just give us the time lines for maybe a proof of concept. What are -- maybe -- and also what are the challenges of developing that in the context of kind of accepted standard of care today?

Yes. So I'll let Charlotte talk about what that -- we're doing a healthy volunteer Phase I study right now with the dual combination that has been initiated to test the two different combinations, 451 plus 2222, which is a TMD1 corrector and then 451 in combination with 109, which is an ICL4 corrector. The design of that study really is meant to show that these two combinations are safe and well tolerated and that we get the PK profile or the exposure profile that we can map back into the CFHBE assay to know exactly how high up the curve we can get from an efficacy perspective. So the goal, it is a healthy volunteer study. We'll be able to determine which of those two compounds or those two combinations that we would select to move forward. But I'll let Charlotte talk a little bit more about like what -- where will we go from there. So after we select the dual combination, how does that play out? What are some of the challenges?

Yes. So first, the next set of studies would be in people with CF. And one of the other nice things about the history of the approved modulators is that generally the healthy volunteer, healthy subject PK has translated very nicely into people with CF, allowing us to map back to that HBE assay. So we -- our strategy, if you step back, really is to build a data set as incrementally. And so the -- obviously, our proof of concept, proof of mechanism Phase IIa study on top of TRIKAFTA is really feasible. Feasibility is very simple and straightforward and that no one has to come off their standard of care modulator. We do expect that as we -- and we expect that, that data set will really be important to help drive enthusiasm for the later-stage studies. For the dual combination, there's a lot of study designs that we're contemplating and that are available to us. We expect that we'll be looking at something like a randomized switch study in order to do dual dose ranging as the next kind of general phase of development with the dual combination in people with CF.

Can you look -- OUS in areas maybe where Vertex is not well adopted or maybe not reimbursed. I mean because I think initially, there is a long -- you probably know this better than anyone, the hesitation from -- in the U.K., right? I mean there's a 3-year negotiation where everyone was jumping on clinical trials there because you had an identified population, but they weren't on drug. But that's less the case now, right?

Yes. So our -- we do believe -- first of all, we hear a lot of enthusiasm. Actually, perhaps -- we hear a lot of enthusiasm both in the U.S. and ex U.S. for alternatives and new things and certainly, things with improved efficacy. So the kinds of studies that we're talking about in CF, they're very -- they're like if a dual dose-ranging study with a dual combination would be something in the 200 patients range. So we think those are very achievable, especially if we're not looking at a strictly placebo-controlled study. So with the -- we don't think we have to go into fringy areas. We think the major areas like the U.K. and the U.S. and Europe where CF research is so well organized, and we -- again, we hear such enthusiasm. We think we can do that there.

And maybe at a higher level, where do the assets from AbbVie and Galapagos fall into your priority list?

Yes. So as you recall, we in-licensed three compounds from AbbVie last year. We're very pleased to in-license those assets. They had clinical data, two of the compounds that we in-licensed galicaftor, which is 2222 and navocaftor, which is 3067, a potentiator both had Phase II data in combination, they had dual data combination or dual combination data for both of those compounds. So we knew they were very active Phase II data, well tolerated. So we're very pleased to be able to in-license some of them. We in-licensed 2851, another TMD1 corrector that had Phase I data. So we really had an opportunity. AbbVie had many assets in their portfolio. We selected the best ones that we felt fit nicely into our portfolio as, one, great combination assets with NBD1, because remember, we only need one other complementary mechanism to combine with NBD1 to potentially get to wild-type levels of CFTR function, fully normal CFTR function. So what we wanted to do by bringing those three clinical stage assets into our portfolio, it really gave us more breadth to the complementary mechanism strategy. We had multiple NBD1 shots on goal. At the time we did the AbbVie deal, we really only had 1 other clinical asset, which was our own SION-109. So by bringing those three assets in from AbbVie, it really gave us multiple options to see which one ultimately we thought would pair the best with our NBD1 compounds. The one we have selected to prioritize is 2222, galicaftor, the TMD1 corrector. That is now in that Phase I healthy volunteer study that I said in combination with 451. And when we look at our preclinical assay data in combinations with 451 and 2222, it's very compelling, right? We have an opportunity, again, with 2222 to potentially get all the way up into wild-type levels of CFTR function in that dual combination. We also have that opportunity with our own 109 compound when we combine with 451, which is why we put both of them into that Phase I healthy volunteer study to help us select which one that we ultimately think can be successful. But the fact that galicaftor has Phase II data that the safety and tolerability is well characterized, it actually showed efficacy in CF patients as a single agent and as a dual combination, both in terms of sweat chloride and FEV1. So we really like that asset. And then financially, we structured it in such a way, it was a very compelling financial opportunity and a financial deal for us as well. So really just added breadth and depth to our pipeline, really helped us put that combination strategy together in a way now that we have multiple options to win there. So it was a really compelling deal.

And so the capital that you have now, though, you can develop both strategies, right? But then how do the assets that you in-licensed kind of fall into that in terms of the -- maybe the R&D spend?

Yes. Do you want to talk about that one?

Yes. So we ended Q3 with $325 million in cash and we have cash runway into 2028. That cash runway assumes that we prioritize our dual combination after the Phase IIa proof of concept and go to the Phase IIb dose ranging with the dual Charlotte was walking us through. As we think about some of our other pipeline assets that are not in the -- either the 719 the add-on, or two duals, that we're evaluating right now with 451. Those are opportunities for us for life cycle development down the road. We're very confident in the compounds we're advancing now, but we always want to be in a position where we can continue to innovate in the future. So that's how we think about those and the priority in our pipeline.

Would you say that in-licensing more compounds is maybe less of a priority? You just have to figure out the assets that you have today and the...

Yes, it's a great question. I'd say it's interesting, right? We were -- the AbbVie deal was perfect, right? It made perfect sense for us strategically to in-license that right down the sweet spot of our strategy, right, adding complementary mechanisms for the reasons that I said AbbVie was a great partner and it was a really well structured deal for us and for AbbVie. So that one made all the sense in the world. I would say that we are a natural home for anything that's sort of in the CF space, right? And we will always listen and look for new compelling assets that are out there. We have a great franchise that exists today that we can continue to go with what we have and feel very strongly that we have a compelling opportunity to positively disrupt the CF landscape. But we do get inbound calls on other assets tangential to CF, what we're really doing now is we want to be hyper focused, right? We want to stay hyper focused. We have the capital to pursue what we're doing. We are open to other BD opportunities, but it would really have to be highly compelling. The bar would be really high because again, we have a great franchise right now that we don't necessarily need to add to, but you never close doors if something came across opportunistically that looked really good. And but in the future, I think this is also one of your questions. Like right now, we are CF-only right? We are hyper focused on CF and our strategy. When we think out into the future and would we expand into other rare diseases or respiratory in some other way, those are all strategic questions we will address as we make further advancements in Sionna past the proof-of-concept data, show that we've got a demonstrated path in CF, we would be open to looking at different areas. We have a great team that has worked in larger markets, larger companies with different backgrounds. So our team is absolutely capable of expanding to new therapeutic areas, but the time right now is to focus on CF and deliver on what we can.

In CF, would there be any emphasis? So Mike, on adding drugs for ex mutation, premature stop? I know that, that's a different mechanism, not NBD1 related and there's a whole like cats and dogs of technologies that have used in that. It's been not easy, right, of a population..

Exactly. I mean like gene therapy, things like that, right? There's other ways of approaching CF. I'd say right now, our core strategy is the F508del patient population, right, and really deliver meaningful improvement to those patients. Again, in time, it could an adjacency be these other mutations, other mechanisms that might help us address the 10% of the patient population for which we can approach that would absolutely be something to think about strategically as a near-term adjacency to what we're already doing. But right now, I'd say our goal is execution, stay highly focused on what's in front of us, deliver that data in mid-'26. And then if we're successful, that opens up a different level of strategic conversations that you can have.

Makes sense. Let me ask you just about the economics of it, right? So the comment we always hear is all these drugs are expensive to begin with. So if you can improve FEV1 on the back of a $250,000 therapy, right? So what does the value of that? Like have you guys done any payer studies or things like that, what does that mean to eventually a patient outcome or it's not just quality of life, right? I mean legitimately like you're improving the pathophysiology of disease.

Do you want to talk little about the add-on approach versus the pool?

Yes. So there's two different pricing models, right? If we have our own dual, we're not adding on to the existing modulators, right? So there we can think about, depending on what our product profile is, you can think about pricing at parity or at a premium depending on where we deliver efficacy. So that's I think, very pretty straightforward. As we think about a potential add-on, we're early in the payer research, where we've looked most is at comps from other markets where there's been underlying therapies and then you add on an additional therapy that further improves outcomes. And so there, what we see from other therapeutic categories is -- and even in with some more expensive base therapies is something like 25% to 40% premium above and beyond the base therapy for an add-on. And so that's sort of the range that we think about today. But obviously, as we have more data, we'll probe further with payers and look at what that could look like further if we were again to pursue that commercially because our primary prior to this path, as we've talked about, is the dual.

Yes. The dual.

I'd say - yes. And the North Star, Geoff, as you know, I mean, it's always about patient access, right? So when you think about your pricing strategy, we'll do all the work to engage the payers around willingness to pay and product profiles look like this, how do we start to think about the pricing strategy. The North Star has to be, how do we ensure maximum patient access, right? And pricing has to feed into that so that you're ensuring you're in a good place for patients, they have access to something that we think could be very beneficial to them. So if you start there, we'll do the work to inform exactly where we think the pricing will be as -- especially as our target product profile becomes more and more clear with more data, it's easier to engage the payers with kind of real data in hand.

Right. Yes. It does seem like when you look OUS or our geographies, U.S., Western Europe, Australia or the kind of the core Vertex markets, but there are many others you don't hear anything about Eastern Europe, Middle East, like South America, Latin America overall. Like so there are pockets of, I think, around the globe where this is truly a global market, probably ex Asia. But my point is that like there are many avenues you could -- there are many different payer discussions you have depending on where you are in the economic spectrum.

Yes. That's right.

So I guess the follow-on to that is that, okay, if you look forward into -- I know -- I mean, Charlotte did me a Phase III, let's get to the proof of concept first but when you start to think about how that could -- what would be the theoretical design of that. That's probably maybe in the back of people's mind, like, all right, like that's not an easy trial to run, but it could be something where if you had a strong argument and a proof of concept to switch for a much -- for a step-up in therapy then that would be a very straightforward trial to run. So I guess, obviously, data-dependent. But get your perspective on maybe what would a pivotal down the road looks like.

Yes. So obviously, I agree. It's early days, and we'll be having -- with data in hand, we'll be having conversations with regulators, which will be really important. We do -- again, we hear a lot of enthusiasm for it. First of all, it's a rare disease space and their regulators have worked with sponsors in this space and it's -- we expect to have partnerships with appropriately. I think ultimately, there are a number of what we consider very feasible possible registration study designs. Our goal, just keep reiterating, our goal will be, first of all, to be data-driven, but our goal will be to demonstrate improved efficacy. And once you have that as your possibility that opens up a lot of study design options, discussions. And so we -- if we -- if the drugs play out as we expect, we expect that there will be a very feasible, frankly, probably pretty straightforward path.

Yes. Maybe, Charlotte, talk too about the TDN and the relations with the CF? The cystic fibrosis foundation is a very important partner in CF, right, for us specifically, but given what exists today and where we think -- how we leverage that relationship?

Yes. Actually, it's been one of the real advantages or sort of joys, I will say, of working in cystic fibrosis is the TDN, the therapeutics development network run by the CF Foundation is really the gold standard for a highly organized, well-funded research network where all the -- most of the patients, the vast majority of patients are well known. They're well known to the researchers, and we get to leverage that our Phase IIa proof of concept has been endorsed or sanctioned by the therapeutics development network, which means we are able to leverage that network. And there are similar networks around the globe as well in the major areas of CF research. So we get to leverage that and work with deeply in those partnerships. So we think that is really kind of the wind at our back in terms of conducting any of these studies. We don't have to go find the patients and the quality of the researcher networks and the ability for them to know their patients well and identify appropriate patients is just extremely high.

Right. And if you go back to the proof of concept studies, Mike, I mean, are you -- you're pretty confident in the predictability. I guess you mentioned the HBE assays, I think, for Vertex that was the -- so the [indiscernible] frequency assay was predictive of clinical but then HPE was predictive of that. So are you pretty confident in what you have that could predict good proof of concept data?

We are -- yes, the CFHBE assay is really a great tool. It is the gold standard in vitro assay, right, that has been demonstrated to be clinically predictive. And as you probably know, it was created by academics, right? And it was honed by industry, Vertex, us and others. We've been running the assay for 15 years. We've got a lot of great data in the assay, including we've synthesized the VERTEX compounds in our assay. We've compared our assay results to the clinical results, and they match. We've got a lot of interface with public domain information of how Vertex runs their assay. We run it very similar to the way that Vertex does. The CFF is a great partner. We collaborate with them and understand that we run the assay the same way that they do. We run the same assumptions that they do. So we have a lot of -- we've tried to validate every which way we can with our assay. And so we have a high degree of confidence and the predictions that the assay is making shows us that we have an opportunity to do something very, very unique. But what the assay is making is a projection, right? It's projecting based on if you hit certain exposure levels and thresholds, this is what the efficacy you can drive. What the Phase I data told us is we are hitting those exposure levels and exceeding them. And so we have a real opportunity to meaningfully raise the efficacy bar within CF. And that proof-of-concept study is the first opportunity we have to demonstrate what our prediction was in the assay and how did that translate to CF patients. And we've set that bar again, that 10 millimolar sweat chloride bar we've set is the minimum. That's where we start clinically meaningful benefit, but we also think there's potential we could push beyond that, but we know what success looks like. Success is at least that 10 millimoles anything beyond that is even just better. And the assay gives us a lot of confidence that we can deliver on that based on what we're seeing in the Phase I and how this will project forward.

And as you move to Phase II and then eventually Phase III, are there disease sort of biomarkers that maybe Vertex didn't look at that you could add? I'm just trying to think of like how you could further differentiate yourself to present the best efficacy. It's not just about FEV1 and sweat chloride, there are other pathophysiology kind of markers?

Yes. So we'll be looking broadly at anything that's appropriate to include in study design. There -- you're right, there may be gastrointestinal differentiators, who knows, but we'll be following the data. I would say we are laser-focused on improving efficacy in general. And right now, we actually see significant room based on the population data significant room to improve the things that are known. And that is chiefly FEV1, sweat chloride, CFTR function and then all of the other things generally in longer-term studies that follow from that. So we'll look for anything and we'll be very eyes wide open. But at this point, we actually don't think we need to go way outside of what has been -- the markers that are important and demonstrate clinically meaningful benefit, we think there's a lot of room to improve those.

Okay. Guys, thank you very much. Great conversation.

Thanks, Geoff. Great to see you.