Alector Inc (ALEC) 2025 Q2 法說會逐字稿

Good afternoon ladies and gentlemen, and welcome to the Alector Inc second quarter and mid-year 2025 earnings conference call. (Operator Instructions)As a reminder, this conference call is being recorded. I would now like to turn the call over to Katie Hogan, Senior Director of Corporate Communications and Investor relations. Please go ahead.

Thank you, operator, and hello everyone. Earlier this afternoon, we released our financial results for the second quarter 2025. The press release is available on our website at www.alector.com, and our 10-Q was filed with the Securities and Exchange Commission this afternoon.

Joining me on the call today, are Doctor Arnon Rosenthal, Co-founder and CEO; Doctor Sara Kenkare-Mitra, President and Head of Research and Development; Dr. Giacomo Salvadore, Chief Medical Officer; Neil Berkley, Chief Business Officer and Interim Chief Financial Officer; and guest speaker Dr. Ryan Darby, Associate Professor of Neurology and Director of the Frontal Temporal Dementia Clinic at Vanderbilt University Medical Center, as well as a paid consultant to a elector who will provide clinical context on frontal temporal dementia.

After our formal remarks, we'll open the call for Q&A. I'd like to know that during this call we'll be making a number of forward-looking statements. Please take a moment to review our slide on the webcast, which contains our forward-looking statement disclosure, and we also encourage you to review our SEC filings for more information. I would now like to turn the call over to Arnon Rosenthal, Chief Executive Officer. Arnon?

Thank you, Katie, and Good afternoon, everyone. As we enter the second half of 2025, Alecto is approaching an important inflection point. By mid-first quarter, we expect topline data from our pivotal Phase 3 INFRONT-3 trial of Latozinemab, our most advanced clinical program.

This trial represents the first rigorous test of low elevating approach to treating frontotemporal dementia due to the GRN gene mutation, a fatal and rare form of dementia that strikes people decades earlier than Alzheimer's disease, and currently has no approved therapy.

We designed Latozinemab based on clear biological and human genetic rationale to elevate progranulin levels by blocking its internalization and degradation by salty receptors. FTD-GRN is directly caused by progranulin deficiency and restoring it has the potential to alter the cause of the disease.

Our earliest studies in participants with FTD-GRN provided encouraging signals, both in biomarkers and in clinical progression. INFRONT-3 will allow us to determine whether those findings hold up in a larger placebo-controlled double blinded trial. Together with our partner GSK, we are advancing lunch readiness activities to help ensure we are well positioned to support the potential commercialization of Latozinemab.

Additionally, we are also excited about our late-stage clinical program in early Alzheimer's disease. Well, we are advancing AL101, our second elevating antibody, which is currently in Phase 2 trial. There is a strong genetic and biological rationale for the role of progranulin in Alzheimer's disease.

Lots of functioning mutations in progranulin have been shown to increase the risk of Alzheimer's disease in humans, while overexpression of progranulin has been shown to be protective in animal models of Alzheimer's disease. Enrollment of this Phase 2 trial was completed in April, and trial completion is expected in 2026.

AL101 shares a similar mechanism with Latozinemab, but its pharmacological properties makes it suitable for more prevalent no degenerative diseases. In parallel, we are investing in a research and preclinical pipeline designed to fuel our future. These programs include a proprietary anti-amyloid beta antibody for Alzheimer's disease and engineered GK enzyme replacement therapy for Parkinson's disease and an anti-tau siRNA for Alzheimer's disease. All enabled by elective brain carrier.

Our proprietary technology platform that enables us to deliver antibodies, proteins, enzymes, and siRNA across the blood and bar. This opened the door to more effective brain directed therapies across multiple modalities. Our latest clinical programs combined with our early-stage pipeline enabled by our operatory blood and biotechnology, gives us the opportunity to deliver both near catalysts and sustain pipeline momentum.

Our goal is to deliver therapies that eradicate all degeneration and improve patients' outcomes and in doing so, build a durable high impact biotechnology company. Our commitment to tackling all degeneration drives us to engage experts who understand these diseases firsthand. It is my pleasure to introduce Doctor Ryan Darby, Associate Professor of Neurology and Director of the Frontotemporal dementia clinic at Vanderbilt University Medical Center.

Doctor Darby brings deep clinical expertise in front of about dementia and will speak to the urgent and me need in this disease. Dr. Darby received his undergraduate degree from Princeton University in Psychology and Neuroscience and his medical degree from Vanderbilt University.

He trained in neurology at MGH and Brigham and Women's Hospital as part of the department of neurology, Harvard Medical, School program. Doctor Darby's research focuses on normal degeneration's impact on brain networks related to behavior and decision making.

His contributions to the field have been recognized with awards such as the Norman Geschwind Prize in Behavioral Neurology. Dr. Darby, thank you for joining us today. I will now turn the call over to you.

Thank you so much for the kind introduction. Today, I'll be providing an overview of frontotemporal dementia, or FTD, which is a complex and devastating group of neurodegenerative conditions that impact thousands of individuals and their families worldwide. We'll touch on its subtypes, the clinical progression, the genetic drivers like FTD, GRN, and the current and future landscape of treatment and diagnosis.

FTD is not a single disease, but instead a group of disorders caused by progressive neuronal cell loss in the brain's frontal and temporal lobes. This neurodegeneration leads to a broad range of symptoms, and we categorize FTD into different clinical subtypes based on those symptoms and the areas of the brain that are affected first.

First, we have the behavioral variant FTD or bv FTD, which is the most common form. It's characterized by striking changes in personality and behavior, such as apathy, impulsivity, and socially inappropriate behaviors. Next, there's primary progressive aphasia or PPA, which primarily impacts language.

In FTD, this is further subdivided into two main subtypes, the semantic variants where individuals lose their understanding of word meaning, and the non-fluent variant where speech becomes halting and effortful. Finally, we have FTD that presents with motor or movement-related symptoms, and this can present with overlapping conditions such as progressive supranuclear palsy or PSP, cortical basal syndrome or CVS and ALS FTD which combines features of motor neuron disease with FTD.

These clinical presentations fall under the broad umbrella term Frontotemporal Lobar Degeneration or FTLD, which is the pathological term reflecting that underlying biology. FTD is most commonly associated with the buildup of two key proteins, TDP-43 and tau.

However, determining which protein is involved in a living patient is extremely difficult unless there's a known genetic mutation or after death at a post-mortem examination. FTD itself is more rare than Alzheimer's, but it is still the most common cause of dementia in individuals under the age of 60.

In the US, the incidence is estimated to be 15 to 22 cases per 100,000 person years, which results in a prevalence of about 50,000 to 60,000 concurrent cases in the US. In Europe, the number is closer to 110,000. The toll on individuals and their families in FTD is profound.

FTD compared to other dementias often leads to greater functional impairments in the activities of daily living, earlier onset, frequently disrupting careers, relationships, and independence. Caregivers and FTD often report a higher burden and more painful loss of sense of personal identity and personhood compared to Alzheimer's disease in part because these patients are presenting with emotionally disengaged symptoms and inappropriate behaviors.

Approximately 30% of FTD cases have a strong family history. We now recommend that there are three main autosomal dominant genetic mutations in FTD. The C9orf7 mutation, the MAPT mutation, and the GRN mutation. There's at least 20 other rare mutations that are also known to be associated with FTD.

Today we're focusing on FTD-GRN, which represents about 5% to 10% of FTD cases. This is a form that results from mutations in the GRN gene, leading to reduced levels of progranulin, a critical protein for neuronal survival and function. So gaming and deficiency contributes to neurodegeneration through multiple potential mechanisms, including lysosomaldysfunction and inflammation.

Emerging biomarkers such as neurofilament light chain or NFL and changes in structural brain MRI are helping us to track disease progression and onset of neuronal loss more objectively. Unfortunately, there are no FDA approved disease modifying treatments for FTD. Management currently is largely symptomatic and supportive, often involving behavioral strategies, speech therapy, and medications targeting mood or agitation.

However, there is hope on the horizon with ongoing clinical trials now targeting genetic forms of FTD including GRN mutations. This offers an exciting opportunity to address the disease at the molecular level and develop new therapies. However, we face several key challenges. First is the diagnostic complexity. FTD is frequently misdiagnosed or diagnosed late in the disease course.

Genetic testing is not routinely performed, and even in younger patients, we often lack information about the underlying protein pathology, making it difficult to tailor interventions or enroll appropriate patients in clinical trials. Trial design is another challenge. Symptoms vary widely, not just from patient to patient, but even in the same person over time, and that can include the full range of behavioral, psychiatric, language, and motor features.

We need better tools to identify patients earlier in that disease course and better ways of tracking that disease over time. Finally, there is an urgent need for disease modifying therapies, especially in the genetic subtypes where the biology is known. Advances in biomarkers are helping move the field forward by enabling early diagnosis, better stratification, and more sensitive tracking of disease progression.

So in closing, FTD is a complex and deeply impactful disease, both biologically and also personally for the patients and families. With increased understanding of the genetic underpinnings like GRN mutation, and the development of robust biomarkers, we're now in the position to truly develop transformative therapies. So with that, I'll turn the call over to Giacomo Salvador, Alector's Chief Medical Officer.

Thank you, Dr. Darby for that insightful overview of the clinical realities urgent [amen] need in front of them for dementia. Your perspective helps frame the importance of our work as we approach the INFRONT-3 data readout by mid Q4. As Dr. Darby noted, FTD-GRN accounts for approximately 5% to 10% of all FTD cases.

This represents about 8,000 to 17,000 cases in the US and the EU alone. It is striking how many people living with FTD still have no [appro] frequent options today, underscoring the need for continued innovation and urgency in this field.

With this context in mind, I want to provide a deeper overview of the science behind our approach, the data we have generated to date, and how our pivotal Phase 3 INFRONT-3 trial is structured. Latozinemab is a novel investigational human monoclonal antibody developed in collaboration with GSK, and we believe it is the most advanced therapeutic candidate in development for FTD-GRN.

We have evaluated Latozinemab in both Phase 1 and Phase 2 clinical studies. In Phase 1, the treatment was well tolerated in healthy volunteers, and those dependent increases in plasma programing were observed. Our open label Phase 2 in front 2 study enrolled 12 participants with symptomatic STD-GRN.

Treatment with Latozinemab normalized plasma and CSF programming levels, resulting in a two to three-fold increase that was rapid and sustained over the course of treatment. We also assessed a panel of relevant biomarkers, including Neurofilament light chain, NFL, Glial fibrillary acidic protein, GFAP and markers of lysosomal function and neuroinflammation.

These biomarkers moved in the direction consistent with slowing disease progression. On the clinical side, we use the CDR® plus NACC FTLD-SB, a validated scale for STD that captures cognitive, functional, behavioral, and language changes. In a blinded propensity match comparison to participants from the GenC2 natural history study.

Treatment with Latozinemab was associated with a 48% lowing of this progression over 12 months. These are the same legal measures and core biomarkers being carried forward into infantry, our ongoing [people's] Phase 3 trial. INFRONT-3 is a 96 weeks randomized double blind placebo controlled global trial, evaluating Latozinemab in 103 symptomatic and 16 at-risk individuals with confirmed GRN mutations.

Participants received 60 mg per kilogram of Latozinemab or placebo via intravenous infusion every four weeks. The primary analysis will be conducted in symptomatic participants, and we plan to include that treats participants in the sensitivity analysis.

The clinical primary endpoint is the CDR® plus NACC FTLD, following engagement with the FDA and in line with the agency's recommendation, we and GSK have made the decision to amend the statistical analysis plan for infant free to include plasma progranulin as a co-primary endpoint along with the CDR® plus NACC FTLD.

Keep in mind that's an approximate 50% reduction in progranulin is a causal factor for FTD-GRN. Additionally, we are collecting fluid and imaging biomarkers, including plasma NFL, GFAP, and volumetric MRI. We believe these positions are to deliver a clear and well-aligned data packages later this year. Infantry is approximately 90% power to detect the 40% slowing of disease progression.

If our key design assumptions hold, a 25% lowing is expected to be statistically significant, and we believe that will represent a meaningful clinical benefit in a disease with no approved treatments has been generally well tolerated across our gas fires, with no major safety signal observed today in either volunteers or patients with FTD-GRN.

As a reminder, Latozinemab has received breakthrough therapy and fast track designations from the FDA, endorphin drug designation from both the FDA and the EMA, following a receipt of the breakthrough designation which was granted based on our Phase 2 data. We had a Type B interaction with the FDA to address key elements of a potential future biologic licensing application.

The agency indicated that the totality of the evidence, including clinical outcomes and this is relevant biomarker, could support a submission for full approval pending the LA review. Additionally, we are lying on a set of fluid and imaging biomarkers that may serve as supportive efficacy data.

We and GSK are preparing for potential BLA and MAA submissions in 2026. Seeking full approval based on the strength of our trial design. Latozinemab represents a biomarker-driven, mechanistically targeted approach to treating genetically defined FTD-GRN,a severe neurodegenerative disease with no approved therapists.

We believe the strength of our clinical data, the alignment with regulators, and the breadth of our clinical and biomarker package position as well as we prepare for the infant re-readout out by mid Q4. Let me also briefly comment on AL101, our second progranulin elevating monoclonal antibody.

AL101 is a distinct molecule that targets a different epitopal and there's a different pharmacogenetic and pharmacodynamic profile, making suitable for more prevalent neurodegenerative diseases. Importantly, as Arnold mentioned, a rationale for evaluating a program elevating approach in Alzheimer's disease is grounded in human genetics.

Reduced GRN expression has been implicated in Alzheimer's pathophysiology, supporting the potential of programming modulation in the setting. AL101 is currently being evaluated in early Alzheimer's disease with enrollment in the global Phase 2 progress AD study completed in April and trial completion expected in. 2026.

With that, I'll now turn the call over to Sarah to share an update on our pre-clinical and research pipeline.

Thank you, Giacomo. As you've heard today, we are advancing our late-stage clinical programs which have a strong scientific rationale, robust trial designs, and meaningful regulatory engagement. In parallel, we are advancing a research and preclinical pipeline that reflects Alector's long-term vision.

These programs are grounded in the same principles that define our clinical portfolio. A strong genetic and biological rationale and high transformational potential and a focus on serious neurodegenerative diseases with first and best in class therapeutic approaches. A key enabler of our preclinical and research programs is our proprietary electro brain carrier.

Delivery of sufficient drug to the brain remains a challenge for targeting neurodegenerative diseases. Our ABC platform is a versatile blood brain barrier transport technology that allows us to efficiently deliver a broad range of therapeutic modalities into the brain. These include antibodies, proteins, enzymes, and siRNA.

By selectively applying the ABC platform to drug cargoes where enhanced brain delivery can address known limitations of efficacy or safety, we believe we can expand what's possible in the treatment of neurodegenerative diseases. Our preclinical programs include a brain penetrant anti-amyloid beta antibody for Alzheimer's disease, where a significant unmet need remains despite the approval of anti-amyloid beta antibodies.

These approved antibodies have delivered plaque clearance, but only modest clinical benefits, and they are associated with side effects such as amyloid-related imaging abnormalities or Arya which limit their use. As a result, the field is increasingly focused on brain penetrant anti-A beta antibodies that aim to increase efficacy, reduce the incidence of Arya, enable subcutaneous delivery, and the possibility of prevention therapy.

Our anti-amyloid beta antibody ADP037-ABC is designed to deliver on these goals. It combines a validated anti-A beta epitope, a tailored FC region supporting robust plaque clearance, and our proprietary brain delivery ABC platform.

While an emerging brain penetrant anti-amyloid beta antibody has shown improved brain exposure and reduced incidence of Arya in the clinic, it has introduced anemia related to transferrin receptor engagement on erythroid precursor cells as a safety concern. ADP037-ABC also uses the transferrin receptor for transport, but it is specifically engineered to minimize anemia while enhancing amyloid beta clearance.

With these features, we believe that ADP037-ABC has the potential to be a best-in-class anti amyloid candidate. Another program I'd like to highlight is ADP050-ABC, our engineered GA replacement therapy. Mutations in the GBA1 gene lead to reduced activity of the lysosomal enzyme, glucose cerebrosides, or GKS, and are associated with Gaucher disease, Parkinson's disease, and Lewy body dementia.

While enzyme replacement therapies are approved for the peripheral manifestations of Gaucher disease, these therapies do not cross the blood brain barrier and therefore have limited impact on neurological symptoms.

With ADP050-ABC, we aim to deliver an engineered, more stable, active form of GKS to the brain, potentially restoring lysosomal function in nerve cells and ultimately countering the brain pathologies associated with Gauchet disease, Parkinson's disease, and Lewy body dementia.

Beyond these two programs, we continue to develop a focused set of research stage candidates addressing neurodegeneration through the removal of toxic proteins, replacement of deficient proteins, and restoration of immune and synaptic function. These include a brain penetrant tau targeting antibody, a brain penetrant anti-tau sIRNA, and a rein moderator.

With that, I'll turn the call over to Neil to provide an update on our financials.

Thank you, Sarah. As summarized in our second quarter 2025 financial results, which we made available after the market closed today, we are in a strong position to deliver against our strategic objectives. We closed the quarter with $307.3 million in cash, which we continue to expect will provide runway into the second half of 2027.

We have updated our 2025 financial guidance. We anticipate collaboration revenue to be between $13 million and $0.18 million. Our total research and development guidance to be between $130 million and $140 million and our total general and administrative guidance to be between $55 million and $65 million dollars.

Our financial position enables us to stay focused on execution across our late stage clinical, pre-clinical and research pipeline. We look forward to providing additional updates as we progress our work. That concludes our prepared comments for today's call, operator, you may now open the line for questions.

(Operator Instructions)

Thomas Shrader, BTIG LLC.

Hi. Good afternoon. Thanks for taking the questions. I just wanted to clarify in the statistical analysis plan. Is the only change that you've added progranulin or is there something else there? And just give us a sense of why you added that?

Did progranulin, I mean, on average, it, normalized, but did it normal, does it normalize in every patient in the prior trials? I'm just trying to understand why you're doing this. And then on the ABC portfolio, is it mostly transferring receptor-based or are you using other receptors? Thank you.

Thanks for your question. This is Giacomo Salvadore, the Chief Medical Officer. The change in our statistical analysis plan to include programming as a co-primary endpoint was reactive to a specific request by the FDA, by statistical reviewer by the FDA who asked us to, make this change to (inaudible) the plan and recognizing the important mechanistic role of programming.

This is the only change made to following a specific comment by a statistical FDA reviewer. Regarding your question about the effect on programming, in the population of patients with FTD-GRN, we have analyzed plasma programming in the Phase two study and we showed a two to three-fold increase in programming after treatment with Latozinemab.

Overall, the, we believe based on our Phase two data as well as the longitudinal data from observational studies, we feel, we believe that we have more than 90%-90% power to show statistically significant effect on programming.

Maybe I'll take the question on the ABC platform, Tom. So yes, while we are exploring other transporter related, transport vehicles, our lead programs that we're talking about do depend on the transparent mediated process.

Okay, great. Thank you. Just to, just to add to you to Giacomo, we are not aware of any case where we treated patients with drug, and we didn't see elevation of progranulin. So progranulin is consistently being elevated in treated individuals, both individuals and STD mutation carriers.

Myles Minter, William Blair.

Yeah, following on from Thomas's first question, why did that reviewer request plasma progranulin? Like this is an antibody, I assume it's largely peripherally restricted with some minimal getting into the brain. I know tapping these patients in terms of CSF and measuring for progranulin is probably problematic at this stage.

But is that reviewer, like, are they basically agreeing that plasma for a granulin with a largely peripherally restricted antibody driving that up regulation is predictive of functional benefit in a CNS disorder like frontotemporal dementia.

That's the first one. And then if Dr. Darby is still on the line, I think INFRONT-3, at its bare minimal, was powered to show a 25% improvement in the slowing of cognitive decline in this trial. Just on the background of what we've seen with the uptake of anti-amyloid therapies in Alzheimer's disease showing a 27% of decline, I know there's some safety concerns with that.

But if it was 25%, is that still an attractive product to prescribe to this patient population? Thank you very much.

Thank you very much for your question. So, the FDA didn't provide detailed rationale for their input on the analysis plan and rationale behind their suggested change and elevating programming at primary endpoint. We believe that the FDA input underlines the importance of programming as a biologically meaningful marker.

In FTD-GRN, mutation of in progranulin gene lead to up insufficiency and is a known case of the disease. Another point to underline is the fact that we had prior discussion with the FDA and we disclosed those in the previous calls and we had an agreement that elevation of progranulin could serve as confirmatory evidence in, our lato cinema program, so this.

Change follow some previous discussion that we have, disclosed before. Regarding your second comments on peripheral versus central, in the face of study, we were able to show robust increases of progranulin, two to three-fold, both in the CSF as well as in plasma. . Therefore, our previous data indicates a strong effect no matter what the compartment is chosen to study progranulin elevation.

Yes, there is a really good correlation with our drugs between the serum and the CSF. Both in healthy volunteers and in patients and in both of our drugs, both in 001 and 101. So with both of our drugs that. Plasma progranulin appears to be a good representation of what actually will also happen in the CSF in the brain.

Hi, this is Ryan Darvey. I can answer the other question, now is the right time. So in terms of that clinical benefit, I think a 25% reduction would be something that would be meaningful in a disease where we don't have any other therapeutic options.

I think in the anti-amyloid infusion comparison, the issues with implementation there, I think center around the side effects and that cost-benefit profile that we're discussing with patients where some patients would opt away from that. I think in FTD, with no other viable treatment options, there'd be more of an interest in that, would obviously depend on the other side effect profile and what that looks like.

Beautiful. Thanks for the questions.

Yes, so far, sort of our drug appears to be very well tolerated. There are no sort of meaningful drug-related adverse effects, or it will be with regard to safety, a different appears to be a different profile than the antibiotic therapeutics.

Alec Stranahan, Bank of America Securities.

Hey guys, thanks for taking our questions. One on AL101 from us as well. Curious how changing the SAP at this stage could affect powering on the modified CDRM boxes and plasma of PGRN is now a co-primary, and in your discussions with the FDA or and or GSK, I get curious if expanded enrollment INFRONT-3 was part of your discussions at all.

And given the FDA's apparent focus on PGRN levels, have you gotten a sense whether plasma PGRN could make its way onto the label as well for selection?

Thanks for your questions. So, to start regarding, our program, how the change in the sub to progranulin. some co-primary effects, the power, or affect the conduct of the study. I can tell you that, with adding two co-primary endpoints. One clinical is the CDR FTLD, some of boxes and progranulin, we need to show statistically significance on both co-primary end points for the study to be positive.

Having said that these two co-primary endpoints are analyzed independently, meaning that the power regarding the CRM of boxes remain unchanged. And as I said before Regarding progranulin based on our face to data, we have more than 99% power, to show a significant effect on elevating progranulin. The other, sorry, can you repeat the other, the question?

Yeah. Just given the focus of the FDA on plasma PGRN and I'm curious if this could be a potential of the population on the label?

Yeah, we haven't had any discussions about labeling, and we will entertain discussion with regulators after we have the trial read out in mid Q4, 2025, but we didn't have any discussion about programming being part of the label.

Understood. Thank you very much.

Yaron Werber, TD Securities.

Thank you very much for the question. This is Stephen Ayanov on for Yaron Werber. Did the FDA mention any particular threshold that they wanted to see for progranulin , or is that just statistical significance? And then to follow up, you mentioned the 90% power to see a 40% lowering. Was that, are you tying that in any way to the progranulin levels or is that just still the sum of boxes and point? Thank you.

Sure, the FDA didn't specify any significant any particular threshold, regarding the elevation of progranulin that they would want to see based on our trial data. They, simply provided a comment that they recommended us to include, progranulin change as co-primary endpoint.

Then the other, question was about the powering and, of, the study's power for 40%, don't know this is progression with lot of cinema versus placebo and this power remains unchanged after the modification. The, as I mentioned just now, the some of boxes and progranulin are analyzed separately.

So, the initial assumption regarding CDR remain unchanged and we, there is no. No change, regarding the CDR, some of boxes and programming we are 99% powered based on our Facebook data.

So it doesn't, so we don't think it's going to affect the probability of success, overall, but the considering the fact that we, in order for the study to be positive, we need to show significance on both co-primary endpoints.

Yeah, I just like to add again that even if we see 25% slowdown in cognitive decline, this will be statistically significant, clinically meaningful, and will most likely be approvable.

Understood. Thank you very much.

Sean Laaman, Morgan Stanley

Hi, this is Mike Riordan on for Sean. Thank you for taking our questions and congratulations on completing enrollment for progress. We have two questions. First one for Dr. Darby. We'd love to hear your thoughts. Assuming success, restoring progranulin to normal levels and FTG progranulin like slowing CDRSP, would that increase your confidence in elevating progranulin above endogenous levels, like being beneficial to patients with Alzheimer's?

Yeah. That's an interesting question. I think that that certainly showing that you can modify the level and have a benefit would help support that. I don't know if it would move you all the way to saying that supra normal levels would have increased benefit if I'm understanding that question.

But certainly restoring to normal levels, shows that the intervention can do that and if it's associated with a clinical benefit that it can have an impact.

Oh thanks. That makes sense and then maybe just, sorry, just a quick follow up what would be like your view on like other FTD subtypes.

Yeah, I mean, I think it would definitely make me curious of seeing what that effect could potentially be, so that, if this is protective, would going even above the normal levels be helpful, I think it would open up that possibility where if there is a subset of patients with relatively lower, even if it's not to the level of progranulin carriers, would that be a good treatment target, and then you'd be able to show that there's something that is potentially able to do that.

Thank you so much. That's really helpful. And then I guess my follow up question would be for management for INFRONT-3, given the potential for inpatient variability on baseline progranulin level, be it by stage of disease or other factors, be it like semantic or motor disruptions, like how are you normalizing for that?

Is it like the FDA requesting like a within subjects comparison from baseline to study end, or is it more like an aggregate comparison between study arms?

I can take this one. So then, we are finalizing the SAP, and in close discussion with the FDA and they, we are going to analyze plasma progranulin change in the active arm versus placebo. So we didn't have any specific request. I can add the fact that Up insufficiency in the grain gene is associated with 50% reduction of progranulin levels and this is enough to produce a disease phenotype, meaning that 50% decrease in progranulin level are almost invariably associated with the frontotemporal dementia and the development of the full-blown disease.

Our previous data showed two three-old elevation of plasma program, and we, the, and yeah, also CSS data are very consistent with that, and we are we able to show normally normalization of those levels in individuals who had baseline deficit. progranulin.

So, Arnold, I don't know if you want to add anything, but it's we see a consistently, low levels of progranulin, in patients with FTD-GRN and this is a functional mutation which is associated with the disease phenotype.

Yes, mechanistically the mutations that cause frontotemporal dementia have full heterozygote also of functions that these are causing mutations that leads to complete ablation of the mutated proteins. There's no gradation in the mutated proteins.

So every individual that has mutations that cause frontotemporal dimensions are causing mutations that lead to haploid insufficiency, like 50% or less of the progranulin. The poor motor mutations are actually the three prime untranslated region, mutations that you refer to are a different class of mutations.

These are mutations that are associated with very modest reduction in progranulin of 10% to 15%, and they are associated with other diseases like Parkinson's disease and Alzheimer's disease, and, but they sort of they don't lead to frontotemporal dementia.

Thank you so much. It's been really helpful. I appreciate the color.

Graig Suvannavejh, Mizuho.

Hi there, this is Doug MacPherson on for Greg. Thank you very much for having me on and taking my call or question rather. So thinking about the relative subjectivity of the end points of clinician severity score and the rating scales compared to biomarker data, is there anything that can be done or has been undertaken in order to try to minimize perhaps a placebo effect or to optimize for like the spread or separation between active drug and placebo?

Thanks for the question. The powering of the study take into account also the expected placebo change based on the natural history, data and the natural course of the disease. We, regarding biomarkers, are unlikely to show any effects, any placebo effect because those are objective measures, NFL as well as GFAT and metric MRI, they're not, there's, no placebo effect as far as we know.

Regarding, broadly speaking, the placebo effects on clinical outcome measures. What we know from neurodegeneric diseases is that if placebo effects are present at all, they typically tend to be manifest in the first few weeks of treatment and they tend to dissipate over time. Our trial are, the infantry studies, 96 weeks long and in a disease that show, you progression over time. So we don't see the lay as a particular risk for this kind of indication.

Sure. Thank you for that. I appreciate it. And then a quick follow up, should we at all be concerned about Arya, for [TRAEs]? And if so, what would be sort of an acceptable Arya prevalence or severity in treated patients?

Yeah, you're asking about which program in particular?

Oh. I'm still on the FTD Phase 3 study.

So, we are monitoring blinded safety periodically and there is an independent and the monitoring committee which oversees the safety of the drug, as well and we didn't have reports of Arya in the study phase INFRONT-3. That's great to hear.

So, maybe if I can add one quick thing, typically Arya is observing Alzheimer's disease and trials and it's associated with the removal of amyloids from the brain, especially from the vasculature. So, in the absence of amyloid or when it is not a prominent feature of the disease, I think the biological rationale for underlying the physiology is not present.

Just wanted to clarify this, so that's why it's not so not expected as feature of this treatment and we haven't observed it, so far.

That's great to hear. Thank you very much. I appreciate you taking the question.

Paul Matteis, Stifel

Hi, this is Emily on for Paul. We were just wondering if there was a situation where you were able to hit on progranulin, but the clinical data was a bit more equivocal. How would you feel about your chances at approval in that situation? Thanks.

Sure. Thanks for the question. So, the study INFRONT-3 is enrolled 103 subjects with the symptomatic FTD-GRN. We can collect a number of clinical measures as well as biomarkers. And we will be, if the data supported, we will be pursuing full approval.

Based on the data and given the fact that there is, there are no approved treatments, and the there is a disease with a very huge burden as Doctor Darby reminded us that just earlier, we, if we will be open to have a dialogue with the regulatory authorities and the FDA, based on the observed findings which may include changes in program in, we, but again we are, we are meant to pursue full approval if the data supports it.

And what we know from the TMS space, the FDA has recently approved drugs that we based on biomarker findings if we think about the approval of toppers and in [1O1ALS]. So there are a regulatory, precedents, especially in CNS diseases which are rare and were with no approved treatment options, but we are pursuing full approval if the data support it.

Thanks. And then just one follow up. Were you able in that meeting the FDA to confirm your sample confirm alignment on the sample size again? Thank you.

Yeah, sure. Thanks for the question. So we aligned on the sample size with the FDA in a meeting that we had in 2023 where we performed the blind the sample size re estimation and we observed the lower viability on the primary outcome measure. The CIASM of boxes at TLD. As we are in mind in our original powering assumption.

So, we agree with the FDA that sample size between 90 and 100 subjects would be sufficient to show 40%, slowing of progression in the active arm with Latozinemab versus placebo. And, we got an agreement with them on the sample size and then we enrolled 103 subjects, so over slightly over the number that we think it's needed to show a clinical effect.

Pete Stavropoulos, Cantor Fitzgerald.

Hi, this is Samantha Schaffer on the line for Pete. Thanks so much for taking our question. So a question for the team, Dr. Salvador and Dr. Darby, related to INFRONT-3. We know that 16 asymptomatic patients were enrolled who will not be included in the primary analysis, based on their baseline NFL levels though, and what we know about natural history, do you expect signs of progression and potential differences between Latozinemab and placebo within the 96 weeks? And then I just have a follow up question. Thank you.

Sure. Thanks for the question. So, as you correctly said that the primary population is are patients who were symptomatic. So these 103 subjects that I just mentioned asymptomatic subjects, 16 of them were enrolled in the trial and will be part of sensitivity analysis. The study is ongoing and remains blinded, so, we, I cannot comment on, what we expect or what we in terms of the ability to see an effect in pre-symptomatic subjects.

We will definitely look at the data and, part of analysis and possibly entertain discussions with the regulators based on the data we observed and the results that we observed.

Just to add to this the recruitment of the pre-symptomatic patients as you said based on genetic mutations of photo central dementia and certain threshold level of neo filament, a sort of published study suggested that such patients could convert to symptomatic within the two year period.

But we will have to see what the actual date of the clinical trial, but that was the original expectations and the rationale for recruiting this group of presymptomatic with high level of neurofilaments.

That's very helpful. Thank you. And just to follow up, we know that there's a part two of the INFRONT study on it's an open label extension. Can you give us a sense maybe quantitatively or qualitatively how this part of the study is progressing? Is there a high rollover rate into the [OLE]?

So we haven't disclosed details on how many subjects rolled over into the [OLE], the company, I can say that we are satisfied regarding the number of subjects who are actually opting in to the open level extension, and we think that they will provide meaningful data about the persistence of the benefit in terms of clinical endpoint and biomarkers as well as what happens in subjects who switch from active from placebo to active treatment, moving to the open level expansion.

There are some very interesting and meaningful precedents in the CNS space about how this open level extension data can provide more clarity on the meaningfulness of the results from the double blind portion of the study.

So we are, we remain interested in looking at the results, but again, the statistical, I mean the analysis will be focused on part one which is the double blind portion of the study, 96 weeks, so we will not focus on the on the open level extension for now.

Great. Thank you, guys.

Thank you. I'm showing no further questions at this time. I would now like to turn it back to Neil Berkeley for closing remarks.

Thank you. Before we end the conference call, I'd like to share that a lecture will be participating in a number of upcoming conferences, including the 2025 Cantor Global Healthcare Conference on September 4, in New York, the Morgan Stanley 23rd annual Global Healthcare Conference on September 8 in New York, and the HC Wainwright 27th annual Global Investment Conference on September 9 in New York.

Thank you again for your time and attention. We will now conclude today's call.

Thank you. This does conclude the program. You may now disconnect.