ARCT - NASDAQ

Good day, everyone, and welcome to the Arcturus Therapeutics Second Quarter 2025 Earnings Call. [Operator Instructions] Please note this call is being recorded. It is now my pleasure to turn the conference over to Neda Safarzadeh, Vice President, Head of Investor Relations, Public Relations Marketing. Please go ahead.

Thank you, operator. Good afternoon, and welcome to Arcturus Therapeutics Quarterly Financial Update and Pipeline Progress Call. Today's call will be led by: Joe Payne, our President and CEO; and Andy Sassine, our CFO. Dr. Pad Chivukula, our CSO and COO, will join them for the Q&A session. Before we begin, I would like to remind everyone that the statements made during this call regarding matters that are not historical facts are forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of performance. They involve known and unknown risks, uncertainties and assumptions that may cause actual results, performance and achievements to differ materially from those expressed or implied by this statement. Please see the forward-looking statement disclaimer on the company's press release issued earlier today as well as the Risk Factors section in our most recent Form 10-K and in subsequent filings with the SEC. In addition, any forward-looking statements represent our views only as of the date such statements are made. Arcturus specifically disclaims any obligation to update such statements. And with that, I will now turn the call over to Joe.

Thank you, Neda. It's good to be with you again, everybody. I will begin with our ARCT-032 program. This is our messenger RNA therapeutic candidate for Cystic Fibrosis. Arcturus is advancing enrollment of adult CF participants in the open-label Phase II multiple ascending dose CF study with daily inhaled treatments of ARCT-032 over a period of 28 days. There is a serious unmet medical need in the CF community, especially with those that do not qualify or benefit from CFTR modulator therapy. Our present Phase II trial is focused on enrolling subjects that do not benefit from modulators, including Class I or null CF participants. We have completed the enrollment and dosing of all 3 participants in the 5-milligram cohort. After a safety review, we were permitted to proceed with enrolling the second cohort at the 10-milligram dose level. All 6 CF participants in the second cohort are expected to complete dosing in early September. Each participant in the second cohort receives 280 milligrams of ARCT-032 over the span of 28 days. And dosing at this level for 28 consecutive days is differentiating. And it's attributed to our modification design and proprietary purification of our mRNA drug substance and to the novel chemical features of our optimized LUNAR delivery technology. The company expects to provide Phase II interim data from these first 9 enrolled participants next month in September 2025, and we expect to complete enrollment for this study as planned by year-end. Arcturus anticipates meetings with the FDA and regulatory agencies in the first half of 2026 to discuss the Phase II data and plans for pivotal trials, including the enrollment of adolescent and pediatric participants followed by Phase III initiation in 2026. I'll now move on to our ARCT-810 program. This is our messenger RNA therapeutic candidate for Ornithine Transcarbamylase or OTC deficiency. In June, the company, along with key opinion leaders, announced positive interim data from 2 Phase II multiple dose studies conducted in the OTC program. In each study and in the combined analysis of both Phase II studies, decreases in glutamine levels to within normal range were observed following multiple ARCT-810 administrations to participants who remained on their standard of care therapy. Mean ammonia levels were stable within the normal range following at least 2 doses of ARCT-810 and remained stable for approximately 28 days after completion of dosing. During the treatment phase and follow-up, 2 out of 3 participants in the Phase II U.S. study showed increases in relative urea genesis function to levels observed in asymptomatic OTC deficient patients as measured by a newly developed and optimized 15N-ureagenesis assay. The remaining participant demonstrated increased 15N-citrulline enrichment. The data taken together suggest improvement of urea cycle function in all 3 participants. This orthogonal supportive data adds further confidence to the glutamine normalization data that we observed. ARCT-810 was generally safe and well tolerated in single-dose Phase I/Ib and multi-dose Phase II studies, comprising 40 participants to-date and including 20 OTC-deficient participants. The company is preparing for meetings with the U.S. FDA and other regulatory agencies to discuss the clinical significance of the observed biomarker changes in relation to the design of the Phase III pivotal trial in pediatric studies. Phase III biomarker and trial design alignment with the FDA and other regulatory agencies is expected in the first half of 2026. I will now provide regulatory updates to our partnered COVID-19 vaccine, also known as CoStave. A marketing authorization application to the United Kingdom's MHRA was filed by CSL, our partner, with an approval expected next month. Moving to Japan. NDA applications were filed by Meiji Seika Pharma to the PMDA for the 2-dose lyophilized vaccine presentation and for the upcoming season's COVID variant update with anticipated approvals this fall. U.S. BLA filing to the FDA remains on track for September with an approval decision expected in 2026. And moving on to ARCT-2138. This is our next-generation STARR seasonal flu vaccine candidate. Under our collaboration with CSL Seqirus, we conducted a Phase I study in 100 young adults and 35 older adults. All tested dose levels of ARCT-2138 were immunogenic against all 4 influenza strains as measured by a Hemagglutination Inhibition assay in both age groups, demonstrating a modest dose response within that range of the tested doses. ARCT-2138 also induced anti-neuraminidase antibody responses at all tested dose levels against all 4 influenza strains. The frequencies of unsolicited adverse events and medically attended adverse events were similar to comparator vaccines. No major safety concerns were raised from the study results. Overall, the study showed the potential of our next-generation STARR vaccine encoding 8 antigens to induce an immune response in both young and older adults with a dose as low as 2 micrograms and was tolerable up to 20 micrograms. Now moving on to ARCT-2304. This is our next-gen STARR vaccine candidate for pandemic A/H5N1 influenza virus, also known as the bird flu. In April, Arcturus received U.S. FDA Fast Track designation for ARCT-2304. This is the program contracted with and funded by BARDA. This contract was highlighted by the HHS in their recent press release as a program that was not impacted by their new budget and vaccine policy. We've completed recruitment of 212 adults, including 80 participants over the age of 60 years old in a randomized placebo-controlled Phase I trial being conducted here in the U.S. All 3 tested dose levels, 1.5 micrograms, 5 micrograms and 12 micrograms in the Phase I BARDA-funded study were well tolerated with the majority of reported solicited AEs being mild to moderate and short-lived. No safety concerns were raised from the available clinical data. The results from this ongoing Phase I study are expected later this year. And before passing the call on to our CFO, we're very pleased to announce that Arcturus has appointed Dr. Moncef Slaoui as Chairman of the Board, which became effective as of July 1, 2025. And with that, I'll now pass the call to Andy.

Thank you, Joe, and good afternoon, everyone. The press release issued earlier today includes financial statements for the second quarter of 2025 and provides a summary and analysis of year-over-year performance. Please also reference our most recent Form 10-Q for more details on the financial performance. As we announced on our last quarterly call in May, our restructuring plan is in the final stages of implementation as we continue to consolidate operations. We have streamlined our internal pipeline to focus on our OTC and Cystic Fibrosis programs, which enabled us to extend our runway into 2028. As I provide a summary of our financial results for the second quarter of 2025, please take note of the significant reduction in year-over-year and sequential operating expenses. Revenue for the 3 and 6 months ended June 30, 2025, was $28 million and $58 million, respectively, representing decreases of $22 million and $30 million compared to the same period in 2024. The declines were primarily driven by lower revenues from the CSL collaboration reflecting lower supply agreement activity and amortization of the upfront payment as CoStave progresses toward global commercialization. Total operating expenses for the 3 months ended June 30, 2025, were $40 million compared with $71 million for the 3 months ended June 30, 2024. Total operating expenses for the 6 months ended June 30, 2025, were $86 million compared to $139 million in the prior year. Research and development expenses were $29.6 million for the 3 months ended June 30, 2025, compared with $58.7 million in the prior year. The significant decrease was primarily driven by lower manufacturing costs for our COVID, Flu and Cystic Fibrosis program and reduced clinical trial expenses for COVID and OTC. Lower payroll and employee benefits also contributed to the decrease, which were partially offset by higher clinical costs for the CF following the ramp-up of Phase II trials in 2025. Research and development expenses were $64.5 million for the 6 months ended June 30, 2025, compared to $112.2 million in the prior year. The decrease was primarily driven by lower manufacturing and clinical costs for the CoStave program, reflecting the program's transition from the development to commercial phase. Additional decreases resulted from lower payroll and benefit expenses and reduced facilities and equipment costs. These reductions were partially offset by higher clinical expenses for the Cystic Fibrosis programs. General and administrative expenses were $10.3 million and $21.7 million for the 3 and 6 months ended June 30, 2025, respectively, compared with $12.3 million and $27.2 million in the comparable period last year. The decreases in both periods were primarily due to reduced share-based compensation expense as well as reduced headcount and employee benefits. We expect general and administrative expenses to continue to decrease slightly during the next 12 months. For the 3 months ended June 30, 2025, Arcturus reported a net loss of approximately $9.2 million or $0.34 per diluted share compared with a net loss of $17.2 million or $0.64 per diluted share in the 3 months ended June 30, 2024. Cash, cash equivalents and restricted cash were $253.4 million as of June 30, 2025, and $293.9 million on December 31, 2024. Based on the current pipeline and the reallocation of resources to the Cystic Fibrosis and OTC programs, the cash runway remains extended into 2028. In summary, the company remains in a strong financial position and has the cash runway needed to achieve multiple near-term value- creating milestones for both the therapeutic programs. We look forward to an exciting second half of 2025 with upcoming clinical data readouts from both our therapeutics and vaccine programs. I will now pass the call back to Joe.

Thanks, Andy. Arcturus had a productive quarter, making excellent progress across our mRNA therapeutics and vaccines pipeline. We look forward to sharing 2 cohorts of Phase II CF data in September. And with that, let's turn the time over to the operator for questions.

[Operator Instructions] We'll take our first question from Lili Nsongo with Leerink Partners.

Maybe 2 CF-related questions. So as we get closer to the readout, can you maybe give us a refresher as to how you think about the bar for success there? And in terms of the patients that have already been enrolled, could you give us a little more granularity in terms of the ratio of modulator eligible to noneligible patients?

Lili, thanks for the questions. Yes, just a refresher for the historical precedent for cystic fibrosis is all through modulators with respect to regulatory engagement. And what they've established is a 3% threshold would be sufficient to advance this into further development [Indiscernible] Now I do remind people that modulators are small molecules. They're systemically distributed throughout the entire body. And the class of subjects or participants are typically Delta 508s. So in contrast, Arcturus is developing an inhaled messenger RNA therapeutic that's topically delivered to the bronchial epithelial cells. And we're also engaging the most challenging group within the CF community, and that's the Class I subjects or modulator nonresponders. But having said that, the short answer to your question is -- comes from the regulatory agency. The FDA has said that if you establish safety and tolerability and a positive measurable FEV, then that would be a significant development to allow us to proceed. And so what does that mean? Well, we'll find out. But clearly, if we can establish safe and tolerable medicines with a positive FEV, then we'll be able to proceed further into development. This would be a big breakthrough for the modulator nonresponders. But there is a legacy expectation from the modulator space of 2.5%, 3% threshold that's required. So that will likely play a role in the discussions with the regulatory agency. With respect to your second question, you were asking about what percentage, I believe, or maybe explain further the distribution of modulator nonresponders in this trial so far. And I can help address that question. And I would say a strong majority of these subjects, these 9 subjects to-date have -- are Class I subjects. We do have representation of modulator that are not Class I, but a solid or strong majority of them are Class I.

Our next question comes from Yasmeen Rahimi with Piper Sandler.

I'm very much looking forward to the data in September. One CF related and one OTC related. Team, could you talk about the type of safety or efficacy? What do you see on a blinded basis, especially around the safety aspect of your product? And then the second one is, could you maybe elaborate as you're going to engage with the agency on pivotal design alignment of what work has been done between allowing the use of biomarkers as a registrational endpoint and could glutamate (sic) [ glutamine ] and -- be potentially use. So I appreciate if you could elaborate on both of these questions, and I'll jump back in the queue.

All right. Thanks, Yas. Good to hear from you. In terms of elaborating on the safety, so for the last few decades, the industry has been aggressively developing inhaled RNA therapeutics. And -- but unfortunately, they haven't succeeded. And the reason for their failure collectively is primarily attributed to toxicology and tolerability issues. And toxicology stems from 2 areas, either the lipids are too toxic, the delivery system itself or the impurities in the mRNA drug substance can be a challenge with respect to toxicology and tolerability. And this is shown in the clinic through bronchospasms, so undesired inflammatory responses and febrile reactions, which are an undesired immune response or elevated fevers, for example. So inflammatory responses can typically be credited to or blamed for toxic lipids. And then on the febrile reaction side or undesired immune responses, those can be attributed to impurities in the mRNA construct. And what Arcturus has brought forward with this ARCT-032 is strong intellectual property and innovation on the delivery system that addresses this primary concern of accumulating toxic lipids. And then on the -- we also have purification IP that we've been building and working on for over a decade now that allows us to effectively purify the drug substance and remove the bad actors, these small double-stranded and single-stranded impurities that can cause these untoward and problematic febrile reactions or undesired immune responses. And that's what we're bringing forward there -- is improvements in addressing what the field has had challenges with over the last couple of decades. Shifting to OTC, what's been done so far with respect to glutamine socialization and familiarity with the regulatory agency as we've provided -- and with respect to our N15-ureagenesis assay (sic) [ 15N-ureagenesis assay ] as well, they're well versed and understand our strategy with respect to Phase II. They are very well aware that we're collecting this data and they're interested in seeing it. We've provided them papers to illustrate the impact of these potential biomarkers and the recent paper as well with respect to ureagenesis. We intend to meet with them to share the recent Phase II data and throughout the coming months. Whether that's in a Type C meeting or meetings is yet to be determined, and we haven't communicated the detail of that strategy. But rest assured, they are aware of what we're trying to do and achieving alignment with them is a key objective for this program. And we would view it as a value catalyst actually or value add if we can get alignment with the FDA and other regulatory agencies with respect to the Phase III trial. But I'll pause my comments there. Thank you for the questions.

Our next question comes from Seamus Fernandez with Guggenheim.

Great. Thanks for the question. So I just wanted to confirm that the highest dose data will be sort of fully represented out to 28 days, Joe. I just wanted to confirm that the 10-milligram cohort and at least 6 patients' worth of data would be available out to 28 days. The second question -- yes, go ahead, Joe.

No, yes. So the first question is, yes, absolutely, 28 days, all 9 subjects. Most of these would also have their day 56 data. We do collect FEV after 56 days. And then there's even 2 months follow-ups after that. But with respect to the final subject, we'll just have 28-day data. They are [indiscernible]

And can you just remind us your -- how you would define kind of clinically meaningful? I think historically, thought leaders we've talked to have said at least 3% on the low end and -- but 5% would certainly be clinically meaningful from their perspective. Just wanted to get your thoughts around that. And if there's a bar for what FDA might be looking for in terms of what they would define as clinically meaningful as you head to meet with the agency in the first half of next year?

Yes. I think 3% is reasonable. However, I just want to make sure it's clear that our program is not a modulator. It's not systemically administered to Delta 508s. It's inhaled mRNA to a more challenging population where the unmet medical need is more severe. And so that would be part of the conversation with the FDA. And also taking into consideration the theoretical likelihood of the FEV elevating further as you extend the study for a longer period of time will be taken into consideration. And what do I mean by that is if you saw 3% after 28 days, then the likelihood of you seeing even more than that in months 2 or 3 through extended dosing is theoretically very high. So that would be viewed very positive even if [ used ] -- whatever the positive number is. So just to reiterate what I have said a few times for clarity is the FDA just wants safety, tolerability and any positive measurable FEV, given that this is a 28-day study, and that would indicate a lot of positive feelings and response and allow us to advance this further into development as you extend that study even further in Phase III.

Just to add to Joe's comments, keep in mind, Seamus, that this class of population unfortunately has a degradation of FEV over -- on an annual basis. And consequently, their lifespan is shortened. And so an opportunity to increase it or stabilize it for this class of population would be quite remarkable and certainly offer them an opportunity to have an extension of life.

We will move next with Myles Minter with William Blair.

This is Jake on for Myles. I wanted to ask a couple more on CF. I was sort of wondering what the interest level was in patient enrollment after the Vertex and Moderna trial paused, whether you saw any difference in appetite for your trial? And maybe sort of comment -- we'd love your comments on the reopening of that trial and whether you think they're going to be able to get over the safety issue that was raised with the DSMB there.

Yes. With respect to the first question, we have several sites open and recruiting subjects. And in the sites where there was overlap with competitors, if those competitors are no longer recruiting and yes, that would directly help or impact our recruitment rate there. But only a small number of sites do we have overlap with our competitors. We're working closely with the CF Foundation, and they've identified sites that have limited competition for us for recruitment. So from that perspective, no. With respect of your other question, it would be, I don't know, inappropriate for me to speculate on what's happening with our competitors with the Vertex program. And I don't want to come across as catalyst, but we frankly don't care that much. When we started this process, there was a half a dozen of these companies aggressively pursuing this, and we've just been putting our head down and executing and working hard. And here we are, and I think we'll just keep doing that. But we definitely have a different delivery technology than our competitors, a different IP estate around purifying. And I think those are areas of innovation and intellectual property that we tend to emphasize as points of differentiation with our competitors. And we'll leave it at that.

Our next question comes from Whitney Ijem with Canaccord.

This is Angela Qian on for Whitney. We have 2 questions on CF. The first one is, do you intend to proceed to a higher dose cohort? Or do you plan to initiate the regulatory conversations based on these 2 cohorts? And then the second one, can you just remind us what your preclinical data has suggested at the comparable doses and the degree of dose response. So when we think about the potentially 3% FEV1 benefit, is that something that you believe could be achieved with a lower dose?

Both good questions. First of all, the present Phase II trial design is a 12-subject trial and 3 doses where we have 3 subjects at 5 milligrams followed by 6 subjects at 10-milligram dosing and then an additional 3 subjects at 15-milligram, that's the present plan. We do have flexibility built into that plan because we -- this is what was initiated and approved upon. But we've just been executing according to that plan. And the first 2 cohorts we've already discussed are the 5 milligram is completed and the 10 milligram is also going to be completed, at least the dosing phase in early September, and we'll be able to communicate some of those interim data. With respect to the dose response -- with respect to the dose response, we -- you would expect that a dose response with a therapeutic like ours. However, we do want to reference the modulator community and the CFTR biochemistry that has not necessarily been observed in the modulator space. That was more of a threshold situation where you increase the dose until it worked, but then you doubled or tripled the doses and it didn't improve the efficacy further. So if -- while we do expect a dose response with respect to our therapeutic, if we don't see it, that's also okay because it may just be a threshold type response that you see with the modulators. And then did I address your question, Angela?

Yes.

Our next question comes from Pete Stavropoulos with Cantor Fitzgerald.

This is Sarah Medeiros on for Pete. Congrats on the progress. Now back to CF. I assume you'll be showing both absolute and relative changes for FEV. So how should we think about presentation and interpretation of the endpoint when taking into consideration the patient's baseline, for example, like a high versus a low FEV baseline? And then just a follow-up, besides FEV, are there any other measurements that you could or will look at to enhance the investigators' conviction in the program, including like quality of life?

Okay. A lot there. Good question. In terms of the FEV data and other lung programs and inhaled therapeutic programs look at area above the baseline as we measure FEV throughout the patient experience in the trial. We'll be looking at kind of area under the curve, and that will be the best way to add the most weight and confidence in the data. In terms of the baseline characteristics, I know that we've included a broad range for formality purposes of 40% to 100% baseline, but it's more like in that 60% to 80% range for the strong majority of these 9 subjects. So I'd say that would be more typical. And then you asked about additional -- in addition to FEV responses, we are asking these participants to include a questionnaire and address answers there. There's about 20 questions, for example, on the respiratory module of the CF questionnaire. This is a well- understood quality of life questionnaire that has been used in the modulator space, and we're using the same thing there. So as you think of it, just to elaborate this on this a little bit more, as I think it's helpful to think of someone who stops smoking, right, the first week and first month, they feel better, but their lung function improves throughout -- not just in the initial weeks in a month, but in 2 and 3 months. So there's continuous healing and continued lung function improvements. And so that's likely what we would expect with an inhaled therapeutic like Arcturus is in the first month that if it's working, that people would see some elevated lung function, feel a lot better, but that could continue on into months 2 and 3, okay?

Our next question comes from Tom Shrader with BTIG.

I think I'll ask some vaccine questions. Your U.S. BLA for COVID, is that going to be for approval of an updated vaccine? Or would that be for the historical vaccine? And so you would need for next year to update? And then on the seasonal flu vaccine, that's obviously getting very interesting. Your thoughts on the interplay of the antigens, do you feel like you have to be as good on hemagglutinin protective antibodies if you have neuraminidase? Is that understood that neuraminidase could cover for some hemagglutinin?

Good questions. Thanks, Tom. First of all, with respect to the U.S. BLA, yes, the initial strategy here is to approve the platform in the original multi-dose vial presentation. It would be fully expected like in other areas and other countries and regulatory agencies that we've been interacting with that an updated variant vaccine would be expected on an annual basis. And so yes, this one that's getting approved is just basically to set the foundation for the platform and get that approved in the U.S. With respect to the -- answering your question on -- it was a seasonal flu question with the interplay of antigens. Let's see what can I do there. We are sharing the outcome of the Phase I clinical study. It's an 8-valent, right? There's 8 antigens, including 4 HA and 4 NA antigens in the seasonal influenza vaccine. And we're going to evaluate the ability of this platform to induce a balanced immune response against multiple antigens without interference. But the changes of the WHO and the U.S. CDC recommendations on vaccine composition where these sorts of antigens are no longer required. So it will require further development of the candidate. But that's probably -- I don't know if I'm specifically addressing your question, but...

I guess really my question is, are your hemagglutinin levels as high as the high-dose protein vaccine? Can you say that yet? And do you know when that will be presented?

Yes. So that's later this year. We'll be able -- what we've disclosed today is that we saw a nice dose response of immunogenicity against all 4 versions of the flu, right? So -- but with respect to details, that will be forthcoming later this year.

Our next question comes from Yigal Nochomovitz with Citigroup.

On CF, could you just comment on the timing of the end of Phase II meeting with the FDA? Am I correct that it's been delayed a bit relative to your initial projections? And if so, is that related to the comments you made regarding seeing continuous improvements in months 2 and 3 and potentially wanting to see additional boost on FEV1 beyond the first month that would present a stronger data package to present to the FDA?

Yes. We've indicated or guided that we'll be completing the Phase II trial enrollment process this year with respect to the third cohort. But shortly after then, we'll have engagement with the FDA. It's an end of Phase II meeting that would be great. But it's at that time that we would discuss with them what's required for a Phase III study. I can only speculate, but we're not expecting to need any other additional trials to allow us to shift or transition to a pivotal trial, especially with adult subjects. So that's the expectation at this point is the end of Phase II meeting will be in the first half of next year, and we'll be able to initiate Phase III as soon as possible in 2026 without the need or requirement to do any additional trials.

And then just -- am I correct, this is the first time that you've actually specified the doses of the 5 and the 10? And is there a specific driver behind that relative to sharing the data only in September?

No. People -- it just allows us to speak more freely as we enter the September bank conference season and engage with investors so that they can now understand that this is a generous dose. Like, for example, previous attempts at inhaled mRNA therapeutics maxed out at 80 milligrams per month, and we're now showing data at 280 milligrams. So that's a big difference. And if we elevate further to the 15-milligram dose cohort, that's 420 milligrams over 4 weeks. So we can now speak to and point to actual data that is more meaningful. That's why.

Okay. That's helpful. And then on OTC, any later thoughts -- latest thoughts on the higher 0.7 mg per kg? I know earlier in the summer, we were debating that possibility. I'm wondering if you have any updates there.

It's a good question. We don't have a definitive answer. There's reasons to proceed at 0.7 mg per kg, and there's reasons to truncate the time line and get this into Phase III more quickly. But right now, I think it's a conservative, reasonable expectation that we'll elevate the dose and get some experience at 0.7 mg per kilogram just to give more therapeutic index comfort to the regulatory agency. But we haven't officially guided that, but I think that's a conservative expectation.

Our next question comes from Yanan

Maybe still on the CF program, given there is no placebo arm, could you talk about what could we look into the data to get comfort in terms of discerning treatment effect versus placebo effects? Of course, if there's a dose response, that will be -- make things easier, but I'm not sure the sample size and also potential as you have highlighted earlier, whether there might be one. But just given that background, can you elucidate on potential ways to analyze the data?

Well, the opportunity to implement a placebo strategy will be in Phase III, and that's still to be negotiated the details of that with the FDA. But there will be plenty of opportunity to implement a placebo arm or a placebo strategy into Phase III if requested. It is kind of self-controlling. These folks have been measuring their FEV for quite a while. And if we'll be leveraging their past experience as some sort of self-control. But with respect to the placebo arm, that's yet to be determined and will likely be included in a Phase III trial. I remind people, too, that our Phase I trial did have 32 subjects in it already. So we have a pretty good experience already with our Phase I and then Phase Ib in another 7 subjects. And then you add on these 9 to 12 subjects that we're going to be looking at in Phase II by the end of this year, will be over 50 subjects of experience with respect to safety. But the shift of the attention from a regulatory perspective will now go to duration. So we only have 28 days of experience, right? That's the other purpose that the Phase III trial will fulfill is an extended duration, whether it's 2, 3, 4, 5 or 6 months will be determined at a later time.

Great. Can I ask a quick follow-up? You mentioned that some patients are followed out to 56 days. Will there be FEV1 measurement in the off-treatment period?

There's an FEV measurement at day 56, but not -- and then there's 2 months of follow-up. But there's -- my understanding on clinicaltrials.org, but my recollection of that is that there's no further FEVs after day 56.

I guess the question is, would we see any FEV1 data after the treatment period has ended, perhaps as a way to discern treatment effect?

Yes. Well, that's the reason why we're measuring day 56 because the treatment phase ends day 28. It will be interesting to share what happens to the FEV response 28 days after dosing has been suspended. So we will have to be able to share some insight there.

Great. Great. Sorry, if I may ask the last question in terms of kinetics or onset of effect based on your understanding of the translation of the mRNA and the protein getting into place to start working, what's the sense of the onset of action and that kinetics?

Yes. The onset of action is relatively quick, right, in order to get the first cells that are available to be transfected and introduce new CFTR into those cells. But upon subsequent administrations, we also see that even more cells will be impacted. And so the threshold of how many cells will need to be transfected and delivered an mRNA that's encodes and expresses CFTR, how many of those cells will need to be impacted before we see a physiological response or FEV improvement is the question we're addressing and how long will that take. But for the cells that get our drug, the impact is fairly quick. In terms of the biochemistry, it's fairly fast. But biologically, it's a different question. Just like how long will it take for the phlegm to clear after someone stops smoking, right? It's a good analogy. It might be weeks or months depending on the person and variable depending on how long they could smoking, for example.

Our last question comes from Evan Wang with Guggenheim Securities.

Just 2 quick follow-ups from [ us at Guggenheim ]. First, with OTC, just wondering when we may see full data there, whether that includes the higher dose cohort or not? And then with influenza, I believe the trial includes a comparator arm or arms based on age. Any comments in terms of, I guess, hemagglutinin response relative to comparator?

Good question. With respect to the comparator data, the details of that will be forthcoming later this year or at least when CSL feels it's comfortable to publish that data. So they'll be providing guidance on the detailed data. We just -- today, we just mentioned some high-level summary. It's difficult for us to guide when that detailed data comes out with respect to how the immunogenicity relative to comparators. So I won't be able to comment on that. With respect to your first question, you asked a when question about OTC. Could you restate that because I missed it.

I'm just curious when we may have fuller data with the OTC program.

Yes, fuller data. Well, it depends if we proceeded to the 0.7 mg per kg cohort or truncate the Phase II data as is because we've already shown that it works at 0.3 and 0.5. We may not proceed with 0.7. But if we do proceed with 0.7, then that will add a few months to the time line. So it's -- once that decision is made, we'll be able to give more specific guidance as to the completion of the Phase II portion of that. What we did guide in today's press release is that we are in parallel socializing the glutamine biomarker strategy and the N15 ureagenesis. And there's very likely going to be a Type C meeting or 2. And then in the first half of next year, we'll be in a good position to have alignment with the FDA, and that's what we're focusing on now. But in the background and in parallel, whether we do 0.7 milligram per kilogram or not, depends on some advice and, of course, our Board approval, et cetera.

We actually show one more question. We will move next with Yale Jen with Laidlaw & Company.

My first question also is on the CF. Now you revealed that you have 15 milligrams that to -- for the next dose. Just curious when you designed the study, was 15 milligrams basically just to push the highest dose you could test the safety and efficacy or any other considerations? And I have a follow-up.

Yes. The 5, 10, 15-milligram dosing strategy was implemented and agreed upon by the FDA when we designed the Phase II trial, and it was based on our experience in the 39 subjects in the CF program. So we explored 4 dose levels all the way up to 27 milligrams in Phase I. And then we looked at intermediate dose levels in the Phase Ib program. And what this -- and then the experience we're -- the data we're collecting in the Phase II study right now is 5, 10 and 15 milligrams. And these were already decided and agreed upon a while ago.

Okay. Great. One follow-up here is that both for 032 or for 810, before you conduct meetings with FDA, should we anticipate one more data release of either one of those? Or what might be the decision?

Yes. I think it makes sense for us to share additional data for both of these programs as we complete the Phase II trials, respectively. So we did an interim data release with OTC and a presentation with KOLs in the end of June. I think it makes sense to share the data set when it's -- when Phase II is completed and also provide clarity on the Phase III trial design once we have that clarity from our conversations with the regulatory agency. And then same thing with the program.

So should we anticipate those toward the end of this year or maybe to 2026?

For the OTC program?

Yes, for either one of those additional data update.

Yes. Well, yes, we mentioned that we'll be -- we expect to complete the Phase II study as presently planned for CF this year in 2025. With respect to OTC, it depends whether we include the 0.7 milligram per kilogram cohort, a small number of people, whether we do that or not, and that hasn't been communicated externally yet. So it's today is not the day to do that.

And we show no further questions at this time. I will now turn the call over to Joe for closing remarks.

get back to you as soon as we can. Good afternoon or good evening, everybody.