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Hello, and welcome to the OPKO Health First Quarter 2024 Financial Results Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to your host today, Yvonne Briggs. Please go ahead.

Thank you, operator, and good afternoon. This is Yvonne Briggs with LHA. Thank you all for joining today's call to discuss OPKO Health's financial results for the first quarter of 2024. I'd like to remind you that any statements made during this call by management other than statements of historical fact, will be considered forward-looking, and as such, will be subject to risks and uncertainties that could materially affect the company's expected results. Those forward-looking statements include, without limitation, the various risks described in the company's SEC filings, including the annual report on Form 10-K for the year ended December 31, 2023, and in subsequently filed SEC reports. This conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, May 7, 2024. Except as required by law, OPKO undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. Before we begin, let me review the format for today's call. Dr. Phillip Frost, Chairman and Chief Executive Officer, will open the call. Dr. Elias

Good afternoon, and thank you for joining us today. In March, we announced an agreement to sell certain assets of BioReference Health to LabCorp for $237.5 million. The assets include BioReference's clinical diagnostics and women's health testing services outside of New York and New Jersey. The transaction was specifically structured in a manner so as to increase the likelihood of obtaining expedited clearance from Antitrust Regulators. But it also streamlines the remaining operations to advance the path to profitability for our Diagnostics segment. The transaction is expected to close in the second half of this year, pending FTC clearance. In general, our long-acting growth hormone therapy continues to gain traction as our global commercial partner, Pfizer, expands its launch of the product in over 40 global markets. This once weekly injection product to treat growth hormone deficiency is the first new chemical entity developed at OPKO Biologics in Israel, where we now have other preclinical candidates under development. One is a long-acting form of oxyntomodulin analog, which I mentioned in our last quarterly call. The PEGylated form of this active peptide has been shown to be effective and safe in treating diabetes and obesity in a Phase II study in over 450 patients. The new long-acting form is expected to have the same form oncology profile as the PEGylated form will permit administering larger doses. We have in development a long-acting Hdh antagonist for the treatment of acromegaly caused by the excessive secretion of growth hormone and IGF-1. We are progressing in our work with Entera Bio to develop oral forms of oxyntomodulin and a GLP-2 analog for short bowel syndrome and other disorders involving nutrient malabsorption. We look forward to keep you apprised of progress with these promising programs. ModeX continues to advance its development work and 2 programs are on track to enter the clinic this year. Our Epstein-Barr vaccine licensed to Merck and our multi-specific oncology antibody, which has received FDA clearance for a Phase I trial. Our collaboration with BARDA is moving forward and provides nondilutive financing to develop multi-specific antibodies against COVID. As work progresses on this first indication, we will begin to explore alternative targets to tackle other biodefense threats such as influenza. With that brief overview, I'll turn it over to Elias. Elias?

Well, thank you, Phil, and good afternoon, everyone. Let me start by apologizing if you hear background noise, I'm in a noisy environment at the airport. But as Phil said, we were very pleased to announce our agreement with LabCorp to sell certain assets in BioReference Health for a cash purchase price of $237.5 million. These assets generate approximately $100 million of annual revenue and include patient service centers, certain customer contracts and operating assets associated with testing services, focused on clinical diagnostics and women's health across the U.S. but outside of New York and New Jersey. We will retain our national oncology and neurology franchises and our diagnostic services in New York and New Jersey. This complements our efforts to improve efficiencies and enhance the productivity of operations, this transaction will streamline our laboratory services business and support our work to reestablish profitability in the near future. As Phil mentioned, we expect the sale to close in the second half of 2024, subject to customary closing conditions and applicable regulatory approvals. As an ongoing initiative, we continue to improve BioReference's performance and in turn, build value. Our focus remains on initiatives to reduce costs, improve efficiency and enhance productivity. In addition, we seek to bolster growth through the expansion of service coverage in our higher-value specialty segments of oncology and neurology, with particular focus in our proprietary 4Kscore test. As you know, the 4Kscore test was first introduced in 2014 as a laboratory developed test. As you know, FDA published new rules to reform the regulation of lab developed tests. This will have a minimal impact on BioReference Health, as all our tests are approved by New York State regulators who are exempted from the announced FDA reform. In December 2021, I would like to remind you, 4Kscore was approved by the FDA, supported by its analytical and clinical data. FDA concluded that the 4Kscore test was -- has the appropriate sensitivity of 96.9% and negative predictive value of 95.9% to contribute to an overall beneficial clinical decision as to whether a prostate biopsy should be performed and accordingly minimize unnecessary biopsies without excess risk of missing critical significant prostate cancers. In more than 100 independent publications by urologists since then, the 4Kscore has ranked as a best-performing biomarker test for the assessment of risk probability for aggressive prostate cancer. Our urology team delivered strong growth in 4Kscore test volumes in the first quarter, and we expect these volumes to build as the test is included now in various clinical guidelines for early detection of prostate cancer for follow-up after PSA screening for initial and repeat biopsies risk stratification. In regard to RAYALDEE, the program continues to enjoy a stable demand, which we hope will grow with new data that will may delay the onset of dialysis according to our most recent analysis. In Oncology, we are pleased with GenPath's performance due to its innovative testing platform with an expanded hematological malignancy panel and very competitive turnaround plans. We continue to see strong growth in our Oncology business with over 12% growth in volume, Q1 2024 versus Q1 2023. Much of this growth was through collaborations with large cancer centers and mid-level health systems. As health systems are challenged with cost and staffing in the oncology space, they are looking for a reference laboratory to work with for their testing opening up possibilities for BioReference Health. GenPath has been able to meet their needs with our enhanced and comprehensive menu across all stages of care. This includes the internalization of our hereditary cancer business in late Q4 2023, which now offers clients an internal solution with fast turnaround times for timely decision-making. We continue to expand our testing portfolio and expect new tests in Q2 to complement our current onco site advance and onco risk portfolio, which will enable GenPath Oncology to evaluate guideline recommended genetic components of [indiscernible] cancer and keep us at the forefront of precision oncology. Similar to our New York, New Jersey Women's Health and Clinical businesses, our National Oncology Testing segment will remain with BioReference Health under our GenPath Oncology brand upon closing of the transaction with LabCorp. We believe that BioReference Health is well positioned for further expense reductions and revenue expansion with a focus on the retained businesses in the New York and New Jersey markets after the divestiture. Complementing these efforts to boost performance, we will continue to improve our diagnostic division to further enhance profitability for OPKO Health and best position us as an innovative biopharmaceutical company. Moving to our Pharmaceutical segment. As you've heard, NGENLA has been launched in all major global markets by Pfizer. We believe this drug is well positioned for significant growth as long-acting growth hormone products become the global standard in treating growth hormone deficiency for children. The launch is progressing as expected with an increasing and significant percentage of patients shifting from daily to the long-acting once-a-week NGENLA product. In addition, we expect our partnership with Pfizer to expand with additional indications including growth hormone deficiency for adults and other pediatric applications. And combined, these approvals for these 2 indications will entitle OPKO to an additional $100 million in milestone payments. Let me go to ModeX. As for ModeX, we're proud of the progress to date. In March, we announced favorable results from the Phase I clinical study with our trispecific antibody against HIV. These clinical data are the first reported for a trispecific antibody in humans and strongly support further development of multi-specific multivalent antibodies against HIV. The antibody was found to be safe and well tolerated at all those levels to both intravenous and subcutaneous routes with minimal anti-drug antibodies observed with dosing ranging from 0.3 milligrams per kilogram to 30 milligrams per kilogram with up to 4 administrations and a pharmacokinetic, which remained consistent and similar to standard monoclinal antibodies. We therefore believe and our partners at NIH believe that multispecific antibodies will offer a differentiated approach to long-lasting, preventive and therapeutic options against most HIV-1 variants, with the possibility of activating the immune system against the latent virus population to effect a functional cure. We are partnered with NIH for this program. Our collaboration with Merck to develop MDX-2201, which is our Epstein-Barr virus multivalent nanoparticle vaccine, is advancing on plan. We received a $50 million upfront payment upon licensing this vaccine with a potential $872.5 million in development and commercial milestones plus royalties on global sales ranging from single digit to double-digit percentages. In terms of timing, we expect this program to enter the clinic in the later part of this year. Our collaboration with BARDA is also proceeding on schedule and represents another source of nondilutive funding for the company. We secured an initial $59 million grant to fund R&D and clinical evaluation to a Phase I study of our multispecific antibodies against non variants of SARS-CoV-2 for the treatment and prevention of COVID-19. Additional funding of up to $109 million may be available from BARDA to develop multispecific antibodies and delivery approaches to target other biodefense threats, such as influenza. The ultimate goal of this research program is to develop a platform with gene-based delivery methods using mRNA or DNA vectors to supplement the body's natural protein production processes, which can then be used efficiently and effectively against future pandemics. Rounding out the ModeX pipeline is our immuno-oncology program, which is focused on hard-to-treat solid tumors as well as certain liquid tumors such as leukemias and lymphomas. We believe our multi-specific antibody candidates can simultaneously target several tumor antigens and enable better control of immune system activation. And we expect our Tetraspecific LASER program for solid tumors to enter the clinic this quarter as our first IND application, as indicated by Phil, focused on solid tumors was deemed acceptable to proceed by the FDA. Other immuno-oncology products are advancing through IND enabling studies and are on target to enter clinical studies next year. So as you can see, it's an exciting time for OPKO as we execute our strategy to gain profitability for BioReference Health by rightsizing the diagnostic division to its most profitable areas of activities, while advancing our Biopharmaceutical segment with several programs set to enter the clinic this year. I will now turn the call over to Adam Logal to discuss our first quarter financial results. Adam?

Thank you, Elias. As Phil and Elias have discussed, we had a busy start to the year, realizing significant value from some of our underlying assets and strengthening our balance sheet. The convertible debt offering in January reduced our cash interest expense. This refinancing provided us the flexibility to align our cash needs for our research and development investments to debt maturities over the next 5 years. In addition, we used a portion of the proceeds to buy back 55 million shares of our common stock, reducing our outstanding shares by over 7%. We also announced our agreement with LabCorp for the sale of select assets, which was a competitive process. And when completed, that will allow us to realign our business operations to focus on core markets and test offerings, and to support our path to profitability at BioReference. While we are still within the review window with the Federal Trade Commission, we are diligently working on the profit plan for BioReference to ensure we get to breakeven and then profitability as quickly as possible. The LabCorp deal was the first large step in the multifaceted plan. Moving to our financial results for our Diagnostics segment. We reported revenue for Q1 2024 of $126.9 million, compared with $132.4 million for the 2023 period. Cost and expenses decreased to $161.3 million for the first quarter of 2024 from $172.4 million for the 2023 period. Operating loss for our Diagnostics segment of $34.4 million included approximately $2.2 million of nonrecurring costs related to employee severance and programs associated with our efforts to return to profitability. Depreciation and amortization expense were $7.9 million and $8.7 million for the 2024 and 2023 periods, respectively. Revenues included approximately $27.8 million related to the book of business that is subject to our sale agreement with LabCorp. The cost and expenses related to this business were approximately $34.8 million. As part of the transaction, LabCorp has agreed to offer employment to more than 700 of our impacted employees who support this business. Moving to our Pharmaceuticals segment, revenue decreased to $46.8 million for the first quarter of 2024 from $105.2 million for the comparable period of '23. Revenue from products, including our intellectual property, our International Pharmaceutical businesses decreased by $2.3 million, reflecting lower sales within our Israeli API business, partially offset by higher sales of RAYALDEE. Revenue from the transfer of IP was $8.7 million for the first quarter of 2024, compared to $64.8 million for the 2023 quarter, which included an upfront payment of $50 million from Merck as a result of our EBV vaccine agreement as well as $9.5 million of milestone payments from our partners for RAYALDEE. During the first quarter of 2024, Pfizer was able to substantially reduce the cost of manufacturing of NGENLA by obtaining approval for a significant scale-up of their manufacturing process in order to support the global launch of NGENLA. In turn, Pfizer has revalued its inventory on hand at December 31, and amortized that difference in manufacturing costs during the first 4 months of 2024, which is their standard accounting policy. As a result, our anticipated gross profit share for the first quarter was less than we anticipated, and we reported gross profit share from Pfizer of $5.8 million, which compares to $3.1 million for the 2023 period. Pfizer has obtained significant payer access in the U.S. in 2024 for NGENLA and we look forward to the continued execution on their global commercialization plan. In addition, other revenue includes approximately $2.2 million from our underlying agreement with BARDA, which offsets R&D and underlying support expenses for that program. Costs and expenses for our Pharmaceuticals segment were $74.5 million for the first quarter of 2024, compared to $86.3 million for the 2023 period. Research and development expenses for the first quarter of 2024 were $21.2 million, compared to $31.9 million for the 2023 period. The 2023 quarter included nonrecurring $12.5 million of expense related to our payment to Sanofi for their portion of our upfront payment from Merck. Partially offsetting this decrease were increased activities for our ModeX development programs. The resulting operating loss for the quarter ended March 31, 2024, was $27.7 million, compared to operating income of $19 million for the first quarter of 2023, which I previously mentioned, benefited from this $57.5 million of milestone payments received in the quarter. Amortization expense related to intangible assets were unchanged at $16.4 million for both periods. Turning to our consolidated results, the first quarter of 2024 reported an operating loss of $71.5 million, compared with an operating loss of $30.6 million for the 2023 quarter. Net loss for the 2024 period included approximately $26.2 million related to the fair value change on embedded derivatives related to our convertible notes issued in January. For both periods, we recorded noncash unrealized gains on our investment in GeneDx of $22.7 million and $16.8 million, respectively, for the 2024 and 2023 periods. As a result, net loss for the first quarter of 2024 was $81.8 million or $0.12 per share, and this compares with a net loss of $18.3 million or $0.02 per share for the 2023 quarter. Looking ahead, we're providing the financial guidance with the following assumptions. For our Pharmaceuticals segment, there are a number of factors that will continue to impact our gross profit share payments from Pfizer, including revenue from product sales from GENOTROPIN and NGENLA. Global sales of GENOTROPIN for the first quarter of 2024, as reported by Pfizer, were $130 million, and Pfizer has not separately reported sales of NGENLA. However, we have continued to observe consistent prescription growth globally for NGENLA as reported by IQVIA and Symphony. After adjusting for the expected accounting impact for the improved gross margins associated with the increased manufacturing scale of NGENLA, we have revised our estimated gross profit share to be between $30 million and $40 million versus our previous estimate of $40 million to $50 million. We also assume a stable foreign exchange rate for our U.S. -- ex U.S. pharmaceutical businesses, which will allow for continued profitable growth. R&D expenses for the second quarter of 2024 will reflect higher activities related to our ModeX programs, including CMC, and efforts related to the initiation of our first immuno-oncology clinical trial. A portion of these increased activities will continue to be funded through our BARDA agreement. For our Diagnostics segment, as the timing of our closing for our LabCorp transaction is not yet certain and is subject to FTC review, we have not adjusted our guidance to remove this business from our second quarter estimates. As we've outlined, we're working to align the business to achieve cash flow breakeven run rate by the middle of 2024 and profitability run rate by the end of the year, which are both subject to the timing of closing of our LabCorp transaction. This work continues to include consolidating our geographic footprint in rationalizing our testing offerings as we expect our client mix to improve as our cost structure -- and our cost structure to appropriately support our go-forward strategy. During this transition phase, we expect consistent core testing volumes with a slight increase in the average price per patient collection amounts due to our revenue cycle management initiatives. Before considering any nonrecurring costs that may result from our restructuring activities and other nonrecurring expenses, we expect our cost and expense in Q2 to decline by approximately $5 million to approximately $154 million to $157 million, without giving effect to the approximately $35 million related to the assets as part of the LabCorp transaction. As a result, we expect the following for the second quarter of 2024: Total revenue between $182 million and $187 million, revenue from services between $127 million and $130 million, including $26 million to $27 million from assets related to the LabCorp transaction, revenue from product sales of $40 million to $45 million and other revenue between $10 million and $14 million, inclusive of the Pfizer gross profit share estimates, which are between $7 million and $10 million. We expect second quarter costs and expenses to be between $234 million and $243 million, again, excluding any nonrecurring expenses and expenses related to our restructuring of BioReference. It will also include approximately $20 million to $26 million for R&D expense. The range is based on the timing of certain CMC activities for our ModeX programs, as well as depreciation and amortization expense of $24 million. That concludes our prepared remarks. Thank you for your attention. And now operator, let's open the call for questions.

[Operator Instructions] And the first question comes from Maury Raycroft with Jefferies.

I was going to start with a question related to BioReference. With the remaining BioReference Services business, it sounds like you plan to continue to streamline, optimize and grow that business with aim to get to profitability. Once the LabCorp deal closes, will you be able to provide more clarity into timing for getting to breakeven and profitability? And what's the longer-term strategy for maximizing value for both the services and pharma parts of the company?

So I'll take the first question, Maury. Thanks for the question. So the timing for us getting to breakeven is going to be tied to the LabCorp transaction. We're not -- we're certainly not waiting for that as it relates to the rest of the business, and we're actively working down our fixed cost base. We're exiting certain facilities currently, which will help bring our fixed overhead, we're also continuing to realign. Our stated goal was to have plans that would be executing to have us to run rate cash flow breakeven midyear, I think we're still looking towards that. Obviously, if the FTC takes longer than expected, then that could take longer. But otherwise, that's the path we're on.

Got it. Understood. And then for NGENLA, can you provide any more perspective or clarity into the revised guidance there and the change in gross profit there?

Sure. So overall, we've seen NGENLA demand continue to be strong on a global basis where Pfizer has been in the market the longest. Obviously, it's continued to do the best. Really, the change to guidance has to do with an accounting consequence of their revaluing some inventory they had on books and that flows through our gross profit share, has no reflection on the strength of the program just on the timing of when we're going to realize the benefits of that improved gross margin that's coming from their scale up.

Got it. Understood. And maybe one question just on some of the ModeX clinical assets. If there are specific catalysts this year that we should be focused on, in particular, for 2001 moving into the clinic. I don't know if there's anything more you can say about that study and when we could see initial data from that?

I'll let Gary who's on the line, and who is the CEO of ModeX, to answer that specific question. Gary?

Yes. As Elias and Phil mentioned, we have the green light to go. So we're, at the moment, setting up sites and really looking to bring patients into the trial. I think the -- as Elias said in his comments, we're hopeful this should happen by the end of the quarter, and we're working to make it happen sooner if possible. In terms of any clinical results, as you probably know, with whenever you're taking a new immune therapy into the clinic, you started a low dose and you dose escalate really for safety reasons, and that's a plan that we've come to craft with the FDA. So I wouldn't be expecting to see any data on certainly efficacy, at least, for -- probably next year is the time frame in which you might expect to see some type of results.

And the next question comes from Jeff Cohen with Ladenburg Thalmann & Company.

A few from our end. I was wondering if you could talk about NGENLA and who will be paying for the additional studies as far as the couple of expanded labels that are mentioned, is that Pfizer or yourself?

So the way our partnership works for those additional indications is we'll split the cost 50-50 with Pfizer.

But we're not -- for the adult, we're not necessarily expecting any additional studies. So just be the pediatric basket.

Okay. Got it. And for full year '24, what should we anticipate from BARDA reimbursement? I know you called out $2.2 million in the first quarter, should we extrapolate that?

We -- you'd expect that to continue to ramp up, Jeff. So that's part of the reason why the R&D numbers going up, they're getting ready to do some CMC activities, which will bump that number up. And just as a reminder, there's -- it was $2.2 million on the revenue line, the expense line is slightly less than that.

Yes. Okay. Got it. That makes sense. And Adam, can you just clarify on the cash and debt? So it was $75.6 million cash and $230 million plus $71.1 million on the debt side?

That's right.

Okay. And the anticipated LabCorp closing, you're expecting by end of year, it sounds like back half and that will be -- or we have the gross number, right? It's $237 million.

Yes. I mean the large unknown on the timing is just FTC. So once we clear the FTC, assuming we clear the FTC, we'll be working quickly with that LabCorp transaction.

Okay. Got it. You're feeling optimistic on the back half of the year?

Yes, that's our expectation.

And the next question comes from Edward Tenthoff, Piper Sandler.

First, just a quick one, Adam. You mentioned the cost guidance for the second quarter of $234 million to -- and I was writing furiously, but I didn't get the number, $237?

$243 million. $234 million to $243 million.

Okay. Great. Super helpful. And then just kind of a higher-level question. Appreciating what Gary and Elias were saying about the multi-specific antibody getting moving. I think the first one is for hematologic cancer, if I'm not mistaken, or is that for solid tumors? And at a higher level, what do you ultimately expect to do with these different ModeX assets? The stuff under BARDA, could that be further partnered? Should we expect more partnerships like the Merck, EBV deal? Do you expect to keep the cancer stuff and generate some clinical data next year, higher level commentary on sort of what the plan is?

I'll be happy to do that, and forgive the background noise. I think it's a solid tumor molecule that we are entering into the clinic this quarter, okay? We do have a liquid tumor molecule, which we're actually discussing with several parties who are interested. I think in the grand scheme of things, we are -- we have a platform -- actually 2 platforms, the vaccine one and a multispecific one. And we are eliciting a lot of interest. We are interested in partnering and especially in research collaboration that will be funded by third parties, where we could develop more targets to enter a larger portion of the market than what we could afford on our own. So we want to leverage the platform with the ability for us to -- through the results we've already had with the EBV with the Phase I trispecific data. And hopefully, with this one, I think it's going to generate a momentum for collaborations and partnerships and licensing that I think will increase our bandwidth. I'll stop here. And Gary, if you have more to say?

Yes. I think you said it well, Elias. I can say, Ted, that we're open to whatever makes sense in terms of advancing these products to approval and getting them to patients. I think that the advantage of having a platform is that we can take individual products and partner them with third parties. And then we can reserve some that may have higher value and [ easier ] path forward for commercialization. We can take some of those internally as well. So at the end of the day, I would -- I suspect that we'll probably partner more than we will develop internally, but we're very open to collaborate.

Well, I think that makes a lot of sense, too, when you think about all the different factors and agents that you can engineer into the multi-specific antibody, a big oncology group who really is doing that multiplex combinatorial analysis makes a lot of sense. That's a lot for you guys to do on your own. And I think you'd really be able to empower some of the bigger players who are looking at ways to combine these different mechanisms. Sorry, I really appreciate what you're saying about the partnering potential for that platform.

And the next question comes from I-Eh Jen with Laidlaw & Company.

Two questions in all regards to the ModeX product to enter the clinic soon. The first one is for the EBV virus vaccine. And my question is there's also a competitor of Moderna also developing the vaccine against the same target. So my question is that at least on theoretical ground, how do you compare yours to that of Moderna's? Then I have a follow-up question.

Well, the answer is simple, again. I mean we're better, but I'll let Gary give you the specifics. I'm just kidding.

Well, just to take a step back, Moderna actually is delivering through mRNA, almost the same gene products that we've managed to engineer onto the ferritin nanoparticle, I'd say for the good of the patients, it's actually a good thing to have more than one product out there being tested because one never knows how they will perform in the real world. I think what we like about our platform is the fact that it's a protein platform and we're using adjuvants that are well described with a safety profile that looks favorable in humans. The preclinical data in nonhuman primates and in our animal models is very strong. And so we're following a pretty well prescribed path with a nice set of immunogens where I think we -- and with great biomarkers when you're looking at viral loads and immune responses to the virus. So we feel pretty good about our product. I really don't want to get into the details of the alternative program. But what I will just say is the obvious, which is that they're using a different platform, they're using an mRNA platform that has some advantages in terms of going fast, but it has some unknowns, particularly with regard to side effects of the therapy. And as you begin to treat more and more patients with a vaccine, those issues become more and more important. And so there's no way to ordain or to have a crystal ball about which will work better. But we feel pretty good about the platform that we have and the partnership with Merck, where they have a real unique bench of experts and knowledge for how to expand the trials and how to expand the reach of this vaccine to what we would ultimately like to address, which is the cause of cancer or the cancer aspect of the vaccine. So that's -- I think that's the best I can do for you right now.

Okay. Great. That's very helpful. That's a lot of details here. Maybe just one more in terms of the 2001. Is any -- could you give us some detail about the study design and maybe what are the targets being pursued by this target anybody?

Yes. We haven't formally disclosed the targets, but we will disclose them in the near future, probably within the next few weeks as we line up to enroll our first patient. But what I can tell you is that we've picked 2 cell surface markers that are found on a number of solid tumors. There actually is a list of about 13 malignancies that express these 2 antigens, and they include lung, breast, prostate, pancreatic and the list goes on. There's a fairly large number to be tested. And we will, in the initial stages, look at a variety of those tumor types. And we'll be looking for signs of some consumer types where we might be seeing more efficacy. And then with time, if that bears out, we'll focus more on the tumor types where we're seeing efficacy and expand the trials in those tumor types.

Okay. Great. That's very helpful. And congrats to move this program off the ground.

Thank you. We're very excited to see it get to patients.

And the next question comes from Yi Chen with H.C. Wainwright.

Just to follow up on the MDX-2001. The solid -- Phase I solid tumor trial is an all-comer solid tumor trial, correct? And how many patients do you intend to enroll for this trial?

We -- the trial is broken into parts. So we have a Phase Ia and then a Phase Ib. I'd say, the Phase Ia will be the group where we will look at multiple different types. And then after that point, we will begin to drill down on the ones where there's more activity. We expect to be able to make some decisions with approximately 40 or so patients in the first, and then that includes some dose escalation because we have to go slowly and we will do that again in agnostic to the tumor type. And then when we reach what we think will be close to a therapeutic level assuming we don't see any side effects that would preclude further expansion, then we would treat the larger number.

And just to clarify, did you say that the results from the Phase I trial won't be available until 2026?

I didn't really say when they would be available because I said probably not before next year as what I said earlier, and I would stand by that. It does take a while to get to the point where you think you're in a therapeutic dose and then you have to enroll sufficient patients and then you have to follow them for a period of time. So expecting to see even early efficacy data. We certainly will have safety data, I think, before the end of this year, that tells us what doses and how well tolerated it is in patients. But I don't expect that we'll begin to start seeing signals until well into next year.

Got it. And could you give us some idea that how many oncology candidates you intend to bring into clinical stage of development before the end of 2025?

I would say that we have -- it will be in the range of 2 to 4. I think very likely there will be 2 that will be entering the clinic by next year, then depending on some partnerships, we may have opportunities to advance another 2.

Okay. And for partnerships, is it likely that you will need to generate Phase II level proof-of-concept data to materialize a partnership here?

I think -- Elias, would you like to respond?

No, no. I wanted to just clarify that it's very different in oncology than in other areas. In oncology, it start with patients. You don't need Phase II data to generate a partnership. You need to have a basket trial in some demonstrable results in a Phase I, Ib, and beginning of II. But you don't need to do what you need to do in other areas, where you need to complete the Phase II to attract a major partner who would like to be a strategic buyer of [indiscernible]. I don't know if you agree with that, Gary.

No, I very much agree. I think that often in oncology, you can begin to see signals in Phase I. And then in instances where you don't, really just depends on the appetite of the partner and of our internal teams in terms of at what point we really want to make those transitions. So I'd say the safe answer is somewhere between Phase I and Phase II.

And the next question comes from Michael Petusky with Barrington Research.

I guess I just want to ask about the RAYALDEE and you guys have been indicating for the last few months, at least, or several months maybe that hey, we've got -- we think we've got some data. We've got some evidence that the product may slow CKD progression. And I'm just curious, I mean, are your sales folks able to share this data, this evidence with a nephrologist or is there any even kind of anecdotal reaction said, "Hey, yes, this is really compelling. This may really matter." I mean can you just give a sense of if there's any sense that this could really unlock this product going forward?

I can expand on that. I mean it's clear that the data that we generated this year was very telling us from real-world evidence as well as from our own data that you could delay the onset of dialysis by 6 months, if not more. Now in terms of the reception of that, we're publishing, obviously, but presented to KOLs and nephrologists, it really makes a difference because no other therapy of secondary hyperparathyroidism has shown the ability to do that. And it shows also we have the biomarkers that really indicate which patients are the ones that really will need the RAYALDEE to delay the onset of the dialysis for their CKD4. So the answer is sales force is out there yet. It's talking to the nephrologists. We see a lot of late-stage CKD that are likely to go into dialysis, but we also think it's valid for CKD3 patients, not just 4. So a story and evolution. I think it reinforces the point that treating secondary hyperparathyroidism patients does have an impact on the evolution of the disease, which was one of the questions we always have as a change outcome. And this is the answer that we have so far. And the data has been reviewed and it's going to be...

Can I just ask a follow-up to that? In terms of -- okay, so you get the data published and you start talking to docs about this. I mean how long -- things sometimes seem to move much slower than they logically seem like they should in terms of changing behavior, prescribing behavior. I mean is this the kind of thing that, hey, it's really a missionary effort and it's a matter of years rather than quarters or to really change behavior or if the data is that compelling?

Absolutely. I think it's the right question. I mean, if you do medicine, medicine patterns and clinical guidelines take time to develop. I mean, you're talking about a year or 2 before they make it to the guidelines like RAYALDEE using the guidelines now. So it's not a rapid process. Depending on the strength and the reception of the community of nephrologists who deals with that, it may be faster or slower, but it's not a matter of the quarter or 2. It will take time to develop.

And this concludes the question-and-answer session. I would like to return the floor back to Dr. Phillip Frost for any closing comments.

Just want to thank everybody for participating and for your very good questions and discussion. And we look forward to being together with you again at the end of next quarter.