Todd James - Vice President, Investor Relations and Corporate Communications Habib Dable - President and Chief Executive Officer Kevin McLaughlin - Chief Financial Officer Matthew Sherman - Chief Medical Officer.

Geoffrey Porges - Leerink Partners Carter Gould - UBS Robyn Karnauskas - Citigroup Edward Tenthoff - Piper Jaffray Alethia Young - Credit Suisse Michael King - JMP Securities Paul Choi - Barclays Capital Christopher Marai - Oppenheimer Terence Flynn - Goldman Sachs.

Good day, ladies and gentlemen, and welcome to the Acceleron Second Quarter 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. As a reminder, this conference is being recorded. I’d now like to turn the call over to Mr.

Todd James, Vice President, Investor Relations and Corporate Communication at Acceleron. Please go ahead..

Thanks, Candice, and welcome, everyone, to our second quarter 2017 earnings call. The press release reporting our financial results, in addition to the presentation for today’s webcast, are available on the investor’s and media page of the corporate website at www.acceleronpharma.com.

Joining me for the call today are Habib Dable, our Chief Executive Officer; Matthew Sherman, our Chief Medical Officer; and Kevin McLaughlin, our Chief Financial Officer. Our goal this afternoon is to provide an overview of the quarter, review updated financial results and outline our key priorities for the remainder of 2017.

After that, we look forward to answering your questions. As a reminder, we will be making forward-looking statements regarding our financial outlook in addition to the regulatory and product development plans and research activities. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted.

A description of these risks can be found in our most recent Form 10-K on file with the SEC. I would now like to turn call over to Habib Dable, our Chief Executive Officer..

Thank you, Todd, and good morning, everyone, and thank you for joining us today. This is a truly exciting time at Acceleron with a number of late and mid-stage trials ongoing and several new trials planned to start in the near future.

We’re making meaningful progress in advancing luspatercept, our lead product candidate, as well as our wholly-owned ACE-083 muscle program. We’ve also been extremely focused on evaluating our ongoing preclinical discovery and research efforts.

We’ve been working across our organization to identify key areas of prioritization based on TGF-beta protein superfamilies diverse human biology in an effort to focus our research and optimize our core capabilities to target new areas of high unmet patient need.

But first, I’d like to focus on luspatercept and provide an update on how the program is progressing and where we see it headed. As you know, we’re developing luspatercept, along with our partner Celgene for the treatment of anemia in two important disease areas; Myelodysplastic Syndromes or MDS and beta-thalassemia.

We recently announced the completion of full enrollment for the MEDALIST Phase 3 trial in MDS and the BELIEVE Phase 3 trial in beta-thalassemia. Throughout the recruitment process, we observed strong interest in the trial from physicians and patients and original enrollment goals were more than exceeded.

Today, there are 229 MDS patients in total in the MEDALIST trial versus the original target of 210, and 336-beta-thalassemia patients in the BELIEVE trial well over the targeted 300.

The rapid pace of enrollment further supports our excitement for the luspatercept program and reflects the clear need for new and effective therapies in both of these patient populations.

To put this into perspective, in less than 18 months, over 560 patients and over 140 clinical sites across multiple countries have been enrolled in these two Phase 3 luspatercept studies.

This is truly impressive and we see tremendous opportunity to dramatically improve patient’s life in new disease areas, as well the opportunity to expand into other indications in which luspatercept to be a very important treatment option. We anticipate reporting top line results for both Phase 3 studies in mid-2018.

We recently presented updated results from our ongoing Phase 2 studies with luspatercept at the International Symposium on MDS in early May and at the EHA Congress in late June.

Results show that luspatercept continue to demonstrate meaningful responses in both MDS and beta-thalassemia with many patients remaining on study drug for two years or longer. Starting with MDS, overall, we saw positive responses on a broad set of lower risk patients, regardless of previous exposure ESAs.

Baseline erthyropoetin levels are ring sideroblast status. Among the presentation highlights, the lower risk MDS patients demonstrated notable increases in hemoglobin lasting for up to 26 months, decreases in transfusion burden and had a high rate of transfusion independence.

In patients with baseline EPO levels of less than or equal to 500 RS per liter. Transfusion independent or erythroid response rates for IWG HI-E criteria were meaningful for both the RS positive and RS negative groups. Specifically, eight out of the 16 RS negative patients are 50% achieved a clinically meaningful risk to erythroidresponse.

Turning to beta-thalassemia for transfusion dependent patients. A 12-week fixed interval analysis was conducted to review transfusion reduction during weeks 13 to 24 and weeks 37 to 48, when compared to the baseline 12-week pretreatment period in order to evaluate durability of response.

As a reminder, the ongoing BELIEVE Phase 3 trial will use this 12-week fixed interval analysis for evaluating the proportion of patients achieving, at least, 33% reduction in transfusion burden.

50% or 12 of 24 patients achieved a reduction in transfusion burden at, at least, 33% in the fixed 12-week interval from weeks 13 to 24, as compared to baseline.

When we extend the fixed 12-week interval analysis out two weeks 37 to 48, only one of these 12 patients fall below the 33% reduction in red blood cell transfusion burden compared to the earlier interval. We also saw sustained increases in hemoglobin levels in non-transfusion-dependent patients for up to 24 months with several still on treatment.

We now have accumulated over 2,000 months of luspatercept patient experience across our Phase 2 trials to-date. Luspatercept’s safety and tolerability remains a key highlight of the program with many patients now on treatment for at least two years.

Based on these consistent and encouraging results, we see a valuable opportunity to expand into first-line lower risk MDS patient segment. And we and Celgene plan to initiate a new Phase 3 trial luspatercept called COMMANDS.

We also recently initiated a new Phase 2 trial in patients with myelofibrosis who have anemia and we are planning to initiate a Phase 2 trial in a non-transfusion-dependent beta-thalassemia called BEYOND. Turning to ACE-083, our wholly-owned locally-acting muscle program.

We are very excited about its potential to be a transformative therapy in patients who experience focal muscle loss. Enrollment in treatment are ongoing in the Part 1 dose-escalation Phase of our two Part Phase 2 trial in facio-scapulo-humeral dystrophy or FSHD.

We also recently reported that the first patient has been treated in Part 1 of our two Part Phase 2 study in Charcot-Marie-Tooth or CMT, one of the most prevalent forms of heritable motor and sensory neuropathy. With that, I will now turn the call over to Kevin McLaughlin, our Chief Financial Officer to run through the financials for the quarter..

Thanks, Habib. Our cash, cash equivalents and investments as of June 30, 2017 were $194 million. This compares to December 31, 2016 cash, cash equivalents and investments of $234.4 million.

As a reminder, we believe that our existing cash, cash equivalents and investments will be sufficient to fund our projected operating requirements into the second-half of 2017. Collaboration revenue for the second quarter was $3.1 million.

The revenue is entirely from our Celgene partnership and is primarily due to cost-sharing revenue of $2.9 million related to expenses incurred by the company in support of our partnered programs. Total costs and expenses for the second quarter were $33 million. This includes R&D expenses of $21.6 million and G&A expenses of $11.4 million.

G&A expense includes a $3.6 million one-time non-cash charge, due to a modification of a former executive officer’s equity awards in connection with his change in employment status announced in May 2017. The company posted a net loss for the second quarter ended June 30, 2017 of $29.7 million.

I will now turn the presentation back over to Habib for final remarks..

Thanks, Kevin. I’d now like to quickly summarize our priorities for the remainder of this year and beyond. Regarding luspatercept with full enrollment achieved in both Phase 3 trials, we are in a position to report top line results for MEDALIST and BELIEVE trials in mid-2018. We also look forward to three new trials.

We and Celgene plan to initiate the COMMANDS Phase 3 trial in first-line, lower-risk MDS in early 2018. We also plan to enroll our first patient in the recently initiated Phase 2 myelofibrosis trial and initiate the BEYOND Phase 2 trial in non-transfusion-dependent beta-thalassemia by year-end 2017.

Looking at ACE-083, we anticipate initial data from the Part 1 dose-escalation arm of the Phase 2 FSHD trial in late 2017. This update will include results from dose cohort 1 and we expect data from all of dose cohorts in 2018. We continue to advance the Phase 2 CMT trial with Part 1 dose-escalation results expected by year-end 2018.

And we also plan to initiate a Phase 1 trial with ACE-2494, our systemic musculoskeletal program later this year. Finally, we’ll be hosting a Research and Development Day on September the 19, in New York City to discuss our long-term vision and growth strategy.

We look forward to discussing our ongoing preclinical research and all of our recent progress in the clinic with luspatercept and our muscle program at R&D Day, where we will include presentations from our senior management team, as well as key opinion leaders and industry experts. We hope you can join us live in New York or via the webcast.

Please reach out to Todd and Candice at the e-mail address of investor@acceleronpharma.com for additional details. And with that, I’ll open up the call to questions.

Operator?.

Thank you. [Operator Instructions] And our first question comes from Geoff Porges of Leerink. Your line is now open..

Thanks very much and congratulations on all the progress on the new trials. A couple of questions, Habib, if I may.

First, on ACE-083, what should we be expecting from that first cohort towards the end of the year? And most importantly, at what top point do you think you’ll get validation of the functional endpoint that you’re using? Will those results include that functional endpoint, or will they just be about specific muscle contraction and muscle bulk? And secondly, I had a question on the new trials for luspatercept.

Could you talk a little bit about how you view the value proposition of luspatercept in those patients who, for example, a non-transfusion-dependent beta thal, or low-risk MDS, where in certain context you’re competing either with EPO or with no treatment.

And it might be harder to justify the sort of pricing that you’ve talked about in the past for those more refractory patients that you studied in MEDALIST and BELIEVE?.

Yes, okay. Thanks, Geoff.

So first of all, I’ll kick off with your second question regarding luspatercept and give you my perspectives, shed a little bit of light on ACE-083 and then I’ll hand it over to Matt, who can provide a little bit more details in terms of specifically what we’re going to be measuring in the first cohort versus – and maybe more in the first part of the study more importantly versus the second part..

Okay..

So with respect, yes, so with respect to the luspatercept just specifically in new indications that we’re looking at, for example, if we look at the first-line settings in MDS where we would be competing with ESAs, and really when you talk about the competition in ESAs, we’re really predominately talking about the lower-risk first-line setting in MDS, whereby in beta-thalassemia, for example, ESAs are just really rarely, if at all, used in that setting..

Yes..

So when we think about specifically now and targeting your question in that specific group, as you know, and I think we talked about this in the past, some of the internal assessments that we’ve done in terms of some of the claims data, et cetera, we estimate that ESAs in the setting are used off-label, approximately $500 million to $600 million a year in the U.S.

alone. And you could argue that, if indeed, and we haven’t concluded this yet, and we plan to share more on this as the year progresses that if we were to go head-to-head improved superiority in this setting against ESAs, the risk of being step edited if you want or the risk of being pulled into that pricing challenge within ESA becomes a lot less.

And I think what we’re saying to ourselves here is that, we really want to differentiate ourselves from the ESAs in the class, and potentially go head-to-head with them in a superiority study.

And I would believe that, in that scenario where you’re on-label versus off-label and superior, you’ve got a differentiated profile, which should be able to justify the value that we’re bringing to the table. With respect to your second question really regarding specifically with respect to ACE-083 in a different cohorts.

So we’ve got three dosing cohorts in Part 1 of the study, Geoff, and that’s really a dose-escalation cohort looking at 150, 200, and 250 milligram. And predominantly, we’re going to be using MRI and muscle growth to be able to inform us in terms of whether or not we should be moving on to the higher doses or not.

That said, I think the subject to your question is the most important part and that’s really, if you’re going to have a drug in this space, you need to demonstrate strength and function. And that’s really what Part 2 of the study is designed for, where we would be recruiting 40 new patients.

It would be a placebo-controlled study and we would clearly be looking at strength and function endpoints in that.

Matt, though, if you’d like to shed a little bit more color though in terms of the first part and three cohorts BEYOND simply looking at muscle growth as to whether or not and how much, if any information would be gaining BEYOND simple muscle growth..

Sure. So, hi, Geoff, this is Matt. So, yes..

Hi, Matt..

To expand on Habib’s answer. So for Part 1 of the study, which is a three-dose cohort and it is open-label escalating, we will have data for the first cohort of 100 milligram cohort, I’m sorry, 150 milligram cohort at the end of this year, which we’re primarily focused on the muscle volume by MRI.

But we’re also following patients for both increases in strength testing and importantly increases in functional testing.

Examples of functional testing include time walking tests for patients whose lower extremities are affected, for patients whose biceps are affected that were locally injecting, here’s performance of the upper limb testing, which is a measure of strength as well in the upper bicep.

So we will have those data for the first cohort by the end of this year help us and inform us, as we continue to escalate to the second and the third cohort for patients..

Terrific. Thanks very much, Matt. That – so we’ll see that at the end of this year that I just want to make that clear..

Yes, we will..

Terrific. Thank you. I appreciate..

Geoff, I think you had one more question Part, at least, to the earlier question regarding NTD and beta cell. And although, we would not be looking at ESAs directly there, I think, what’s more important here is the value proposition that we would be bringing to the table.

In that, many of these patients still – with the increased levels or the decrease of hemoglobin have a lot of different symptoms. And as you know, we talked about this before simply being symptomatic is enough to make these patient feel pretty miserable.

And if you look at the IWG guidelines and if you look at the ability to have clinically meaningful responses with these patient, the unmet need is still pretty high. And we’re really trying to target that specifically as well..

Great. Thanks very much for the answers, I appreciate it..

Yes. Thanks, Geoff..

Thank you. And our next question comes from Carter Gould of UBS. Your line is now open..

Good afternoon, guys, and congrats on the progress.

First question, would you be willing to give any quantitative details on enrollment in the FSHD studies like this cohort one fully enrolled? And then secondly, just trying to get some additional color on how we should be thinking about internal versus external programs? On one hand, you’re going to have an Analyst Day, that’s going to focus on the pipeline.

On the other hand, there’s some new language in the queue around acquiring or in-licensing external assets, you’re also looking to hire a BD person. So just trying to understand how you’re prioritizing in-house versus external assets? Thank you..

Yes.

So regarding FSHD enrollment, Matt, do you want to take, I can take the second part?.

Hi, Carter. So, yes, we’re very pleased with the enrollment to-date. We are progressing very nicely. We’re on track. And as we’ve indicated, we’ll have data from the first cohort by the end of this year..

And Carter, regarding specifically your question on in-house versus external, what I can tell you right now, TGF-beta has always been the foundation of what we’ve been doing here. We’ve – we’re going to continue to focus on TGF-beta internally.

I think that’s what really differentiates us in terms of the deep expertise within this organization in terms of whether it’s research development, and really understanding where this particular area could take us.

One of the things that we will talk about at R&D Day in September, we’ll be right around exactly where are the various opportunities? Where are the areas of high unmet need, where we feel we can leverage our deep expertise and potentially go into areas that we haven’t talked about. I’m going to shed some light on some of that analysis.

And we’ll obviously be talking a lot more about where we are with our existing programs in terms of luspatercept in the muscle programs.

Regarding external and BD specifically, I guess, you could look at BD in a number of ways, right? When looking at business development opportunities could also mean, once we get to a certain point within our own existing portfolio, we may be considering opportunities in trying to finding partners to be able to help us and assist us with our wholly-owned pipeline in market, say, for example, outside of the U.S.

These are options that we will consider. We have not made decisions on that yet. But we also have said that, we are very committed to building leadership in therapeutic areas that we’re committed to.

And at a certain point, when we are able to declare that we’ve gained enough progress in certain disease areas, whether that’s FSHD, or CMT, or others, we will be open to looking at enriching our portfolio with complementary assets perhaps in non-TGF-beta-related assets and bringing them in-house.

But today, this is all preliminary thinking and really just good housekeeping, as we prepare ourselves for growth and leadership..

Thanks, Habib..

Thank, Carter..

Thank you. And our next question comes from Robyn Karnauskas with Citi. Your line is now open..

Hi, guys. Thank you. So a couple of questions. So first, on the muscle program. So you mentioned that we could get some strength in function data.

Can you just shed some expectations a little bit here? And how you’re thinking about number one, what would be data that would motivate you to move to next goes? Do you think you’ll – the patient will be – it will be long enough to see a benefit and giving you a preclinical work like where do you expect to see – would you expect to see a benefit on function and strength at the lowest dose? And then second for SG&A side.

Do you expect that to be high in the second-half of the year as a single or a bit higher this quarter?.

Yes, thanks, Robyn.

So I’m going to pass the first question over to Matt to talk a little bit about the strength in function datasets, and then maybe Kevin you can take the second question regarding the SG&A costs?.

Hi, Robyn. So, yes, let me just sort of walk through what the design of the study is and again just emphasize what information we have. So Part 1 was – is an open label part of the study in three dose levels – dose-escalating.

We escalate on safety, so we don’t actually need to have all the information in terms of muscle volume, muscle strength testing or muscle function another two to escalate. It is our plan. So we are, obviously, collecting that information one to two weeks throughout the study.

And the Phase 2 study has been designed as a three-month study, and we do feel that that is a duration that is sufficient to be able to see meaningful changes in these parameters.

If you go back to the healthy volunteer study, it was only after two doses 21 days apart that we’re able to see a 14.5% increase in muscle volume in the rectus femoris muscle and 8.9% increase in muscle volume in the tibialis anterior muscle.

So certainly with three-month dosing in the Phase 2 study, we expect that we’ll meet or exceed those levels, of course, this is a disease population that’s the unknown..

Robyn, hi, this is Kevin. On the – on your question regarding SG&A and spending as we go forward in time, the second quarter was impacted by a one-time non-cash charge of about $3.6 million regarding the change in status of one of our employees. That obviously, caused the second quarter run rate to go above what has been a more normalized rate.

So we would expect expenses to grow over time, but not in a manner which is represented in the second quarter..

Got it. Thank you..

And our guidance remains unchanged in turns having enough runway to take us into the second-half of 2019..

Got it. Thank you..

Thanks, Robyn..

Thank you. And our next question comes from Ted Tenthoff of Piper Jaffray. Your line is now open..

Great. Thank you very much. Just digging a little deeper into the systemic muscle program.

What looked to be potential Phase 2 indications for that? And with respect to sort of more systemic disease, where do you think you might go broadly with respect to endpoints and/or different disease areas?.

Hey, Ted, it’s Todd. Thanks for your question. So as far as that program goes, I would say, there’s a bunch of areas that we’re thinking about in the rare disease muscle – neuromuscular area that we could, someone like our size Acceleron around could develop here in-house.

And as far as going into details of disease areas, I’d say, stay tuned for R&D Day, where we’ll give some more of our thinking about how that program will progress. And then the first goal is to go into a healthy volunteer Phase 1 study.

And so I would say, as far as a protocol or endpoints would depend on the disease that we choose for the Phase 2 study and all the other parameters, so stay tuned..

All right. Fair enough. Looking forward to R&D Day. Thanks..

Thanks, Ted..

Thank you. And our next question comes from Alethia Young of Credit Suisse. Your line is now open..

Hey, guys, thanks for taking my question, sorry, two for me.

One can you talk a little bit about the background luspatercept to use in myelofibrosis and kind of where it positions relative to the current players in the market? And then just a kind of a strategic question, I guess, as you guys kind of move forward and move past some of the interesting programs that you have now, are you looking to kind of be more of a smaller scale company as far as rare diseases, or are you will – you focus on large opportunities into their partnerships, or is it kind of both doors are open, if you can expand on that, that would be great? Thanks..

Hey, Alethia, it’s Habib. So thanks for your questions. Regarding the first one, regarding myelofibrosis in terms of it’s kind of sizing up the opportunity. Right now, you’ve got Jakafi, which is used in the marketplace for those patients – for those myelofibrosis patients who suffer from an enlarged spleen.

If you really look at that patient group, you’ve got approximately 30,000 patients that we estimate with myelofibrosis. About half of those patients, Alethia, we believe suffer from moderate to severe anemia, okay? Some of them are actually anemic without an enlarged spleen, some of them actually are an anemic and have an enlarged spleen on Jakafi.

So we plan to be looking at dose populations in monotherapy with luspatercept, as well as an add-on to Jakafi..

And the strategic question?.

Yes. And so strategically, you’ve kind – you’ve cut off a little bit when you’re asked on the second part. Could you just repeat the second part of the question a little bit..

Yes, sure.

I’m just trying to understand whether you have a preference toward like smaller market opportunities that you commercialize, or opportunities that would require partnership, or you still kind of down in the middle on this?.

Yes, now I got it, yes. So right now, our focus really is on those rare diseases where there’s a huge unmet need. And in most cases, the areas that we’re studying right now are in areas where there’s actually no pharmacology therapy.

Now, if indeed, we find that we’ve got some compelling science and mechanism of action that leads that towards an area of high unmet need and it happens to be a very large area, we’ll think about that and perhaps assess the many strategic options that we would have at our disposal.

But I would argue right now, that is not core to our strategy and that we really are focusing on those rare diseases with high unmet needs..

Great. Thanks..

Yes, thanks..

Thank you. And our next question comes from Mike King of JMP Securities. Your line is now open..

Hey, guys, sorry, little slow getting of mute there. Maybe further to the questions about MDS – lower-risk MDS and myelofibrosis. Can you talk a little bit about Commands and BEYOND, because I don’t know that investor world has gotten sort of a broad appreciation of the kind of endpoint you’re trying to achieve in both of those.

So if you might shed some lightness on that front for starters? Thanks..

Yes. So with respect to those two disease areas, we obviously are going to – we’re still obviously working with the authorities. We’re working with our partners at Celgene and looking at some of the specific endpoints. Between now and the end of the year, we obviously will be shedding a lot more light on that.

I think what does remain is the fact that, in both those areas, the unmet need is very high. And specifically, when you look at the first-line setting where COMMANDS is looking at, all we have is off-label use ESAs.

And as you – as you’ve probably seen some of the recent publications, Mike, even at ASH, these patients are being treated with ESAs, with minimal to moderate effect. You saw that the data was anywhere from 15% to 30% response rate. And the durability within the patient population, it’s relatively low.

When we saw that it’s sounds from seven to 12 months in those cases. So we’re really trying to look at finding an opportunity for us to differentiate and to do that in a meaningful and durable way.

And I believe that as the year goes on and as we get more and more feedback from the authorities, we’ll be able to share with you a little bit more specifics about what those endpoints will look like..

Okay, so it sounds to me like what you’re saying is that it’s really about the magnitude of the benefit over ESAs as the accepted standard of care rather than any one particular definition of superiority?.

Hey Mike, it’s Todd. If you look at their –.

Hey, Todd..

– their HI-E rate that Habib described at the 15% to 30% rate, and you look at the treatment naive patients that we evaluated in our Phase 2 trial that it remains ongoing, we’re seeing a 50% plus response rate on a HI-E.

If you look at their data, if any patient came into a trial with a baseline transfusion burden, it really significantly impacts the patient’s ability to respond. If you look at data with luspatercept in Phase 2 in patients that are naive and a transfusion burden really doesn’t impact their ability to respond at all in that patient population.

So, from based off of our Phase 2 results, we see clear differentiation between the patients that they are able to get respond versus luspatercept, so a lot to be excited about in that patient population..

Got it, okay and is it also fair to say that it maybe also about what the appropriate secondary end points might be in order to either demonstrate quality of life benefits pharmacoeconomic etcetera?.

Yes, I mean I think given that, so always all end points are fairly important, obviously nothing outweighs the primary, but given that it’s off label therapy, we think you know definitely just showing at a primary will be very important..

Got it, okay that’s great. Thanks for further added color. And then question on Myelofibrosis, just wondering if, I mean I know a lot of them have anemia, but it comes from a failing marrow. So if you don’t have – you know based on the mechanism of luspatercept and sotatercept for that matter.

If you’ve got – if you are not generating enough of the BFU, the blast and other cells in the lineage, how helpful do you think luspatercept can be in that setting?.

Hi Mike, it’s Matt.

So, we hope it will be very helpful and based on the earlier data that we generated from the investigator-initiated trial at the MD Anderson Cancer Center showing that we had, five out of 14 patients we had response – hematologic response to sotatercept, so what that adds, the background information, obviously moving forward with this, very well designed rigorous Phase 2 study of luspatercept in myelopoiesis patients.

You asked really about the endpoints for this, this trial is now posted on clinicaltrial.gov, so it’s detailed there..

Okay..

The end points are fairly, again fairly standard or rigorous end points in terms of the anemia only patient. They are required to have an increase in hemoglobin of 1.5 g/dL over 12 weeks and for the patients with transfusion dependent, they must become transfusion independent as well for a period of 12 weeks.

So, with those data, we obviously will have lot of information to move forward into a Phase 3 trial..

Yes, I appreciate that. Again I’m just trying to figure out sort of the factors that determine commercial success in addition to clinical success, but we can take the rest of that discussion offline.

I just wanted to spend a second on another topic, a separate topic that I talk to clients about a fair bit and that’s sort of the overall advancement of the gene therapy space, you know we’ve seen a lot obviously in hemophilia, but I think most investors think that the same – similar benefits are going to come to things like beta-cell, sickle-cell etcetera.

So just wondering how you guys think about the advent of gene therapy when you are thinking about your strategic and commercial planning? Thanks..

Mike, this is Habib. With respect to gene therapy, I mean we are obviously aware of some of the studies are ongoing there.

I personally feel if gene therapy is successful, it will be a wonderful thing for patients, but I also believe that we would not be direct competitors for all patients in that space and that there will be an opportunity for luspatercept in a very, very large population independent of that success.

And we can talk about why I believe that whether that’s because of access, whether that’s because of the specific patient groups that they would be targeting etcetera.

But I do believe wholeheartedly that if the opportunity for gene therapy and beta-thalassemia comes to existence that can only be a good thing for patients and it’s something that we have taken into account, but do not see as a formidable competitor in where we plan to compete..

Okay, thanks for taking my questions..

Thanks Mike..

Thank you. And our next question comes from Paul Choi of Barclays. Your line is now open..

Hi, thanks for taking our questions and also let me offer our congratulations on all the progress in the quarter. Thanks for the details on the enrollment updates and numbers for both MEDALIST and BELIEVE and it looks like you exceeded your targets by about 10% give or take.

And I just wanted to check if by the success in enrollment, would there be potential changes in empowering or effect size or anything if we should think about the assumptions being somehow affected by the excess enrollment in both of those studies?.

Hi, Paul. So no, I think as Habib indicated, it was a very rapid enrollment, it was very enthusiastic support by the investigators and certainly by the patients that led to the over enrollment, it’s not unusual for such large trails more than 70 sites per trial.

Once you hit that target enrollment, slowing it down those patients and screening who will eventually need to be swept into enrollment if they were eligible and then further randomization would discontinue. It won’t have any significant impact on the powering of that study..

Okay, great and thanks for that.

And then I know it’s several months off here, but is it fair to expect that the upcoming ASH meeting in December that you’ll have any incremental updates on the Phase 2 datasets that you presented at EHA for either the MDS or the beta-thalassemia studies?.

Hey Paul, it’s Todd. Yes, so we always plan and submit abstracts for the upcoming medical conferences and so that that time period just popped up on us here in August and so we’ll be able to discuss more of the plans when those abstracts will be potentially accepted in November..

Okay, great, thanks for taking our question..

Thanks..

Thank you. And our next question comes from Christopher Marai of Oppenheimer. Your line is now open..

Hi, guys, thanks for taking the questions and congrats on the quarter.

Just wondering if you could touch base on ACE-2494 systemic formulation I suppose of the myostat inhibitor, maybe remind us that it differs from 083 and how you might expect that impacts, I guess the side effects, the notes that you file with systemic is ACE-083? And then secondarily, just with respect ACE-083 trail enrollment, could you give us some color decision in patient sort of excitement around that drug and then perhaps any indication that those intramuscular injections are being well tolerated, I know there will be three weeks, but is that something you might address with the 2494 in those indications and then I have one follow-up, thank you..

Hi Chris, it’s Matt. So, in regard to the first question for ACE-020 molecule, we will going to the healthy volunteer trail, we’ll initiate it by the end of this year, so we’ll have more update in terms of the specifics of the trial design and actually the potential therapeutic indication in the molecule itself.

So I think just stay tuned for that, we’ll also be able to provide some update as well at the R&D day, but our overall strategy across our different programs. We – regarding – I’m sorry your second question. [Multiple speakers].

On the mechanism, so as ACE-031 that was partnered with Shire that we discontinued due to having an impact on vasculature due to its binding of a TGF-beta ligand called BMP9 and so what we are able to do is protein engineering for our new systemic molecule was basically take that binding out and now that molecule ligand trap hits GDF8 or myostatin, GDF11 and and activins.

And the difference between ACE-024 and ACE-094 and ACE-083, ACE-083 was developed after the naturally occurring ligand trap in the TGF-beta superfamily called follistatin. So different protein, though, they hit similar ligands with hitting GDF8/11 and activins also with ACE-083, but the protein itself is different..

And again, to add to the strategy, so ACE-083 is developed as a local muscle injection ACE-2494 will be a systemic. And really talking different diseases, because there are some diseases, as we indicated earlier, about FSHD, dystrophy, and CMT that can affect some of the number of muscles.

And so they are a local therapy has the advantages of not having system exposure, where other diseases potentially might be more amenable to a systemic therapy. In regard to local injections for ACE-083, we haven’t released any information yet regarding the study.

But we’re very pleased with the progress and now we continue to be on track for having data from our trial by the end of this year..

Okay, great. And then just with respect to the trial in CMT, I was wondering they’re talking nerve impairment probably where the disease is diagnosed and part of the disease in general.

And I was just wondering, how can we expect the benefit or what type of benefit should we sort of expect if you’re increasing muscle strength in size, but the nerves may still be impaired.

Is it possible that you’re going to be able to enter the early on here any disease, or when nerves are still intact, or how should we look at that in terms of a potential patient benefit, and how are you identifying those potential muscles in the trial? Thank you..

So regarding trial on CMT, as you say, as you can hear, this is a disease where there’s lots of nerve function as opposed to a loss of muscle function and secondarily, then the muscle plus innovated and was strong. With that intact muscles there still is nerve innervation to their muscle and patients do have residual strength.

So by building up muscle strength and function, it should improve the function for the patients. We identify patients, there – this is actually a disease that’s definitely took effect about 100,000 people in the United States.

They present fairly routinely to regional or muscular clinics and in terms of eligibility for the trial they must have some strength. So that they – some mild to moderate weakness, but obviously some residual strength as well in order to for us to be able to show benefit for therapy..

And Chris, it’s Todd. I’d also add that, we’re focused on specific subtypes of CMT with CMT-1 and CMTX. And these subtypes of the disease are more adept myonating form and don’t have external involvement until much later in that patient’s disease progression. And to Matt’s point that there are still healthy nerves innervating the muscle.

And so we believe if we are able to strengthen and enlarge the fibers connected to those healthy nerves that we’d increase the overall contract out force of the muscle.

And focused in CMT on the tibialis anterior as many of these patients have put drop and it really tax their ability to lift the front their foot when they walk leading to not only lots of mobility, but a lot of falls..

Great. Excellent. I appreciate that. Thank you..

Thanks..

[Operator Instructions] And our next question comes from Terence Flynn of Goldman Sachs. Your line is now open..

Hi, thanks for taking the question. Just maybe two for me. First, on the front-line MDS trial that you guys are planning. I was just wondering if you can share any preliminary thoughts on how you’re thinking about baseline EPO level for inclusion and then also ESA dosing, as I know, that can be pretty variable and given it’s an off-label indication.

How you’d look to nail that down> And then the second part is, just do you guys see the oral hip inhibitors as a potential future competitive threat to luspatercept and MDS? Thanks.

Matt, I turn it over to you..

Yes. So, hi, Terence. So, we haven’t really presented any of the details in terms of the state designs. I think, we’ll just have to stay tuned and wait till later in this year when we get to the specifics of the trial design.

Just to refer you to the most recent update that we had in terms of the activity at the – both at the MDS Symposium in Valencia and EHA in Spain, we’re able to show that, we have very good activity in MDS patients – in the lower-risk first-line MDS patients with baseline EPO level less than 500. So, that’s one good benchmark to keep an eye on..

As far as the hips go, Terence, we really look at them very similar to the ESAs. In that, they boost natural erythropoietin levels. And so as far as a mechanism, we think that their results would probably be fairly similar to the essays.

And given the mechanism for MDS in these patients being more of this later stage, in effect of a erythropoiesis versus an actual lack of endogenous erythropoietin, think that that therapy will have some challenges in having a significant impact on these patients anemia and underlying confusion burden..

Great. Thanks a lot..

Thank you, Terence..

Thank you. And I’m showing no further questions at this time. I would like to turn the conference back over to Habib Dable for any closing remarks..

Thanks, everybody, and thanks for joining the call this afternoon. We hope you enjoy the rest of this summer and we look forward to seeing you at the upcoming conferences and as well the R&D Day on September the 19. Have a great day, and please feel free to reach out to us if you have any additional questions. Thank you..

Ladies and gentlemen thank you for participating in today’s conference. This does conclude the program. You may all disconnect. Everyone have a great day..