Arrowhead Pharmaceuticals Inc (ARWR) 2017 Q4 法說會逐字稿

Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals Conference Call.

(Operator Instructions) I will now hand the conference call over to Vincent Anzalone, Vice President of Investor Relations for Arrowhead.

Please go ahead, Vince.

Thanks, Liz.

Good afternoon, everyone.

Thank you for joining us today to discuss Arrowhead's results for its fiscal 2017 fourth quarter and year ended September 30, 2017.

With us today from management are President and CEO, Dr. Christopher Anzalone, who will provide an overview of the quarter; Dr. Bruce Given, Our Chief Operating Officer and Head of R&D, who will discuss our near-term clinical candidates; and Ken Myszkowski, our Chief Financial Officer, who will give a review of the financials.

We will then open up the call to your questions.

Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

All statements, other than statements of historical fact, including, without limitation, those with respect to Arrowhead's goals, plans and strategies are forward-looking statements.

These include statements regarding our expectations around the development, safety and efficacy of our drug candidates, projected cash runway and expected future development activities.

These statements represent management's current expectations and are inherently uncertain.

Thus, actual results may differ materially.

Arrowhead disclaims any intent and undertakes no duty to update any of the forward-looking statements discussed on today's call.

You should refer to the discussions under Risk Factors in Arrowhead's annual report on Form 10-K and the company's subsequent quarterly reports on Form 10-Q for additional matters to be considered in this regard, including risks and other considerations that could cause actual results to vary from the presently expected results expressed in today's call.

With that said, I'd like to turn the call over to Dr. Christopher Anzalone, President and CEO of the company.

Chris?

Thanks, Vince.

Good afternoon, everyone, and thank you for joining us today.

2017 has been an enormously productive year for Arrowhead as we moved forward from the very difficult decision in 2016 to discontinue development of prior generation drugs, ARC-520, ARC-521 and ARC-AAT, that utilize the EX1 delivery vehicle.

That decision moved us from a clinical stage company with 2 Phase II candidates and a 1 Phase I candidate to a preclinical stage company overnight.

In addition, at that time, we had not disclosed much about our new platform and had not given guidance on time lines for getting back into the clinic.

Understandably, there's a lot of uncertainty for investors about where Arrowhead was going.

We're clearly on our heels, but the real metal of a company only makes itself known in the face of adversity.

As we look back on what we accomplished and forward to what is to come, I'm extraordinarily proud of this company.

We are on pace to file 2 CTAs to begin clinical trials during the next 2 quarters.

These are for ARO-AAT to treat Alpha-1 liver disease with a CTA planned in Q1 2018 and ARO-HBV as a professionally curative therapy for chronic hepatitis B infection with a CTA planned in Q2 2018.

We think the insights gleaned from our prior programs in HBV and Alpha-1 liver disease represent real competitive and strategic advantages and should enable us to move with speed and precision once the clinical programs begin.

We are also on schedule to file 3 additional CTAs in the next 12 months.

These are for ARO-APOC3 and ARO-ANG3 to treat hypertriglyceridemia and ARO-LUNG1 against an undisclosed lung disease target.

All 3 are planned for CTA filings around the end of 2018.

In addition, our 2 cardiovascular collaborations with Amgen are moving forward rapidly, one which was previously called ARO-LPA against the target lipoprotein A, or Lp(a), has been formally nominated as a clinical candidate and which is now referred to as AMG-890 by Amgen.

We anticipate that this may enter the clinic some time in 2018.

The Amgen deal was announced in September of 2016, and Arrowhead received $56.5 million in upfront payments and initial equity investment, and we are eligible to receive an additional $617 million in potential milestone and equity payments.

So we plan to go from 0 clinical programs to 5 or possibly 6 over the next 12 months.

I don't believe I have ever seen any biotech company do this.

The table is now set for a potential breakout to 2018 and 2019 as the makeup of this company changes dramatically and we see how these drug candidates perform in patients.

Let's now unpack this a bit and take a look at these programs.

First, they are all built on a new platform.

In September, we hosted an R&D Day to unveil the new targeted RNAi molecule, or TRiM platform, that builds on more than a decade of research at Arrowhead on actively targeted drug delivery vehicles.

We view TRiM as an evolutionary step to the field of RNAi delivery.

The TRiM platform retains the maximal activity of prior-generation technologies but moves towards structural simplicity that offers several advantages.

These include: One, simplified manufacturing and therefore, reduced costs; two, multiple routes of administration, including subcutaneous injection and inhaled administration; and three, potential for improved safety because smaller molecules with reduced metabolites may reduce the risk of intracellular accumulation.

Also, the TRiM platform does not rely on DPCs, so we expect substantially wider safety margins than we had in previous generations.

ARC-AAT is a good example of what we believe TRiM can do.

It appears to be more potent than ARC-AAT and provides a longer duration of activity, but we expect a significantly better safety profile.

In addition, much of what we learned from the ARC-AAT program gives us confidence in ARO-AAT.

First, potency of ARC-AAT, our previous-generation compound, in nonhuman primates was predictive of potency in humans.

Should this hold for ARO-AAT, we would expect a monthly or even less-frequent dosing should provide near-complete suppression of hepatic sources of AAt.

Second, knockdown in healthy volunteers was similar to knockdown in patients.

If this holds for ARO-AAT, we could predict proof-of-concept, at least as it relates to activity, early in Phase I.

Similarly, our experiences with prior HBV programs have guided many of our plans and expectations for ARO-HBV.

We have always believed that a sufficiently potent and well-tolerated RNAi-based therapy could enable s-antigen seroclearance and functional cure of chronic hepatitis B infection, which has been elusive for other drugs and mechanisms.

Our case for the potential importance of ARO-HBV toward this goal has strengthened last week when we presented new data at the HEP DART Conference from the ARC-520 open-label extension study.

Specifically, we showed that 50% of patients in the follow-up study, or 2 of 3 e-antigen positive and 2 of 5 e-antigen negative patients, have achieved a sustained host response after receiving ARC-520 treatment in combination with entecavir characterized by continued reduction of multiple HBV biomarkers, including s-antigen, and coinciding with an increase in ALT, indicative of host response.

So what does this mean and why should you care?

Well, our goal has been to silence everything the hepatitis B virus makes and thereby, enable the body to overcome immunosuppressive forces and control the virus on its own.

ARC-520 appears to have done something that enabled the host to fight the virus on its own even after ARC-520 was withdrawn, and this is a big deal.

This is the first clinical evidence that an RNAi-based approach can lead to the type of favorable sustained host response that we have always believed is possible and in fact, critical if a functional cure is to be reached.

If this was, in fact, a marker of the immune system being reawakened, then it bodes very well for ARO-HBV.

When considering these results in the context of ARO-HBV, keep in mind that ARC-520 was a suboptimal therapy, in part because it could only silence gene expression from cccDNA.

This leaves continued production from viral DNA that integrated into host DNA unchecked, and we have demonstrated that integrated DNA can be a major source of s-antigen production.

Therefore, ARC-520 was fighting the virus with one arm tied behind its back.

It was only targeting one source of immunosuppressing s-antigen.

Importantly, ARO-HBV may be substantially more active against s-antigen than ARC-520 since it was designed specifically to hit all viral mRNA transcripts from both cccDNA and integrated DNA.

We also have reason to be optimistic about our newly announced hypertriglyceridemia programs, ARO-ANG3 and ARO-APOC3.

Angiopoietin 3 and apolipoprotein C-III are validated targets that are independent risk factors for cardiovascular disease, and they're not effectively addressed by traditional therapies.

In addition to large cardiovascular market opportunities, these targets are associated with smaller orphan indications as well, providing multiple regulatory pathways and market approaches.

This flexibility is important in part because it offers strategies that could involve partnering or keeping candidates in-house for internal development.

Finally, we believe that our new lung programs represent a fundamental leap forward for RNAi generally and for Arrowhead specifically.

In multiple animal models, we have been able to deeply silence lung targets via inhaled administration.

This capability is a good example of the flexibility of the TRiM platform, and addressing lung targets will open a host of new opportunities.

Once we validate the first program, whose target remains undisclosed, we view the lung-targeting TRiM technology as a franchise unto itself.

We will provide additional details on initial program as well as more data in 2018.

With that overview, I would now like to turn the call over to Dr. Bruce Given, our COO and Head of R&D.

Bruce?

Thank you, Chris.

And good afternoon, everyone.

Chris mentioned that ARO-AAT and ARO-HBV are on pace for CTA filings during the first 2 quarters, and then we anticipate having up to 3 additional CTAs before the end of 2018.

These are all very exciting programs for us.

Today, I want to focus just on ARO-AAT and ARO-HBV since they are our current lead programs and are on pace to get into the clinic shortly.

I will go over 2 areas for each candidate: the therapeutic rationale for the target and select data that provides us with confidence in the candidate's potential.

Let's start with ARO-AAT.

Alpha-1 antitrypsin, or AAT, deficiency involves a genetic mutation that causes the AAT protein to be misfolded and does not properly exported from the hepatocytes.

This causes 2 downstream issues for patients with this disorder: First, AAT protects stitches from inflammation and damage.

Patients that have the misfolded protein have low circulating levels of AAT, which can lead to early-onset lung disease.

Second, since the protein is not properly exported from the liver, it accumulates, and then aggregates into polymers and globules inside the cell.

So the lung disease is due to deficiency in functional AAT.

But in the liver, it's a storage disease.

There are approved protein replacement therapies for the lung disease.

But at this time, the only option for treating the liver disease is transplant.

There are estimated to be around 100,000 potential patients in the U.S. and possibly more in Europe with alpha-1 antitrypsin deficiency.

Based on those numbers, it qualifies for orphan disease designation, but it is one of the more common rare diseases.

RNAi, as a mechanism, is very good at halting the production of an individual protein.

So we think alpha-1 liver disease, which is clearly caused by the accumulation of the misfolded mutant AAT protein, is a very attractive therapeutic target.

We have done extensive work with the transgenic mouse model that produces the human Z mutant protein, which is the one we care about.

Unfortunately, this model recapitulates several aspects of the human disease well.

The mice have problem secreting the Z protein, but they do get some out of the circulation just like humans.

The Z protein in hepatocytes forms polymers and globules.

Their livers get inflamed, and they develop hepatocellular carcinoma as a result.

We completed separate studies in which we intervened early in disease progression during that stage and then also in older mice that had started to develop hepatocellular carcinoma.

We really wanted to confirm that RNAi was the right approach here.

In young mice, we demonstrated that we could virtually eliminate the monomer production, and they had less polymer and globules just 8 weeks later than they had at baseline and substantially less than mice that had gone untreated over the 8 weeks.

So the liver is doing what we would hope.

In older mice that already have a lot of globules in there liver at baseline, when treated for 32 weeks, their livers moved a long way back towards normal.

They had minimal to moderate globules, but much less.

They also no longer had compressed nuclei, which were present at baseline and which were seen in mice treated with placebo.

Treated mice also had no inflammatory cells.

When we studied older mice, we also saw a significant benefit from treatment.

The liver architecture of treated animals improved, and they had a clear reduction in hepatocellular carcinoma.

These results provide us with confidence that an RNAi-based therapy like ARO-AAT has a lot of promise against alpha-1 liver disease.

In addition to the work we've done in mice, we have also looked at knockdown of circulating AAT in primates, and we also have clinical experience with our prior-generation compound, ARC-AAT.

In primates, ARO-AAT led to a reduction of circulating AAT of over 90%.

Keeping in mind that about 10% of AAT is produced outside the liver, so we believe 90% knockdown represents near-full suppression of the liver-produced protein.

The duration of effect in primates was long, which may enable a monthly, bimonthly or even longer dosing interval.

As Chris mentioned, we intend to file a CTA for ARO-AAT in Q1 2018.

We are excited to get back into the clinic, and we have designed an innovative first-in-human study that is intended to generate single-dose and multiple-dose data rapidly in one study.

We will discuss this design in further detail when the study is initiated.

Now the HBV.

There are estimated to be between 200 million and 350 million people chronically infected with HBV, and it is a difficult-to-treat virus for which curative therapies have been elusive.

HBV is clearly a global health problem that needs to be addressed.

The current standard of care involves nucleotide and nucleoside analogues, or nukes, that inhibit reverse transcriptase.

This class of drugs is very good at reducing circulating virus but does almost nothing to improve functional cure rates over patients who receive no treatment at all.

Many experts believe that HBV infection remains chronic because, in addition to fully formed viral particles, the virus produces a large excess of viral proteins that silence the immune system and prevent the body from exerting immune control.

At Arrowhead, we sought to develop a therapy that reduces the production of all HBV gene products, including pregenomic RNA; polymerase, the core protein that forms capsid; surface antigen; e-antigen; and the X protein.

We believe deeply reducing everything that HBV produces may allow the body's immune system to reconstitute, leading to a sustained host response and ultimately, a functional cure of HBV.

I'm sorry here.

I just lost my place.

Here we go.

In fact, we've recently presented some follow-up data on ARC-520 that we think represents the first clinical evidence that an RNAi-based approach may lead to the type of favorable sustained host response that we have always believed is possible.

Just like other difficult-to-treat viruses, HBV will likely require a combination approach.

So how do we see a central role for an RNAi therapy like ARO-HBV?

Because we attack the entire transcriptome, and that's the most important to us, I think, any other direct-acting HBV drugs are going to be enhanced by RNAi because we reduce the inputs.

We reduce the stress on these drugs, and we have already seen synergistic effects with nukes.

Also, RNAi has been the only way to date to address s-antigen coming off of integrated DNA.

So from our perspective, anybody who wants to have the best possible chance of achieving a functional cure, better have an RNAi in their combination regimen.

I recently had the opportunity to present some select preclinical data on ARO-HBV.

Notably, 3 doses of ARO-HBV monotherapy in wild-type plasmid HBV mice led to reductions in HBV DNA of 3.44 logs, and both s-antigen and e-antigen dropped below the level of quantitation.

This represents reductions of greater than 3 logs and greater than 2.2 logs, respectively.

In addition, Arrowhead created a mutated plasmid HBV model that eliminates the HB X trigger site to simulate HBV in patients with high levels of integrated HBV DNA relative to cccDNA.

In this model, a single dose of ARO-HBV led to a reduction in s-antigen of 2.95 logs.

The duration of effect was long, and s-antigen was still reduced by approximately 2 logs at 8 weeks following the dose.

This is highly encouraging, and ARO-HBV was very active in these models.

We plan to file a CTA by Q2 2018.

And like ARO-AAT, we intend to generate as much single- and multiple-dose data as we can in our first-in-human study.

Importantly, we intend to include HBV patients during Phase I in the multiple-dose ascending portion of the study.

As with ARO-AAT, we will provide further detail when the study is initiated.

Now I'd like to turn the call over to Ken Myszkowski, Arrowhead's CFO, who will review our financials.

Ken?

Thank you, Bruce, and good afternoon, everyone.

As we reported today, our net loss for fiscal 2017 was $34.4 million or $0.47 per share based on 73.9 million weighted average shares outstanding.

This compares with a net loss of $81.7 million or $1.34 per share based on $61.1 million weighted shares outstanding for fiscal 2016.

Revenue for fiscal 2017 was $31.4 million compared to $158,000 for fiscal 2016.

The increase is driven by the upfront payments received from our collaboration agreements with Amgen.

During fiscal 2017, we have recognized revenue for -- all but $5.3 million related to the Amgen agreements, and we expect to recognize the balance in fiscal 2018.

Total operating expenses for the year ended September 30, 2017, were $68.4 million compared with $81.9 million for the year ended September 30, 2016.

Net cash used in operating activities in fiscal 2017 was $23.9 million compared with $64.4 million for fiscal 2016.

Our R&D expenses declined from $41.5 million to $31.7 million, primarily due to discontinuation of our previously -- or our previous clinical candidates in November of last year, although close-down expenses continued into the fiscal second quarter.

Salary and payroll expense also declined due to the workforce reduction we put in place after the discontinuation of our previous clinical candidates.

General and administrative expenses also declined, primarily due to a reduced professional services expenses.

Turning to our balance sheet.

Our cash and investments totaled $65.6 million as of September 30, 2017, compared to our cash balance of $85.4 million at September 30, 2016.

The decrease in our cash and investments balance reflects cash used in operations of $53.9 million and $7.8 million of capital expenditures, primarily related to the build-out of our new research facility in Madison, offset by $42.5 million in cash received from Amgen consisting of a $30 million upfront payment for ARO-LPA and $12.5 million in additional equity investment.

Our common shares outstanding at September 30, 2017, were 74.8 million.

With that brief overview, I'll turn the call back to Chris.

Thanks, Ken.

As you can see, we've had an incredibly -- excuse me.

As you can see, we've had an incredible amount of progress throughout 2017, and we believe the 2018 is set up to be transformational.

Transition onto the TRiM platform has been rapid, and we expect to file CTAs for 5 drug candidates in calendar 2018, where we believe we have strong competitive advantages.

We are clear leaders in alpha-1 liver disease and expect to be the only company with a clinical candidate against this manifestation of alpha-1 antitrypsin deficiency in the first quarter of 2018.

We are clear intellectual leaders in chronic HBV and expect to be, once again, development leaders in RNAi treatment of HBV.

We believe that RNAi will become a backbone therapy for HBV, and we plan on being back in the clinic in the second quarter with what we see as the first RNAi therapeutic with a real chance of enabling functional cures.

We are leaders in RNAi for cardiovascular disease and believe that Amgen, with a candidate we developed, will be the first company to use RNAi against Lp(a) in humans.

Similarly, we expect to file CTAs for ARO-ANG3 and ARO-APOC3 by the end of 2018 and that we will be the first company to use RNAi against angiopoietin 3 and apolipoprotein C-III in humans.

We are also now leaders in RNAi for lung targets.

This opens a new chapter for us and enables us to go after diseases in ways no other company is capable of at present.

We expect to file a CTA for our first lung candidate by the end of 2018 and believe we will be the only company with a viable approach to using RNAi against lung diseases with inhaled administration.

This is certainly a lot.

But given our nonclinical data and experience in AAT and HBV, we feel comfortable with these aggressive plans.

It is also safe to assume that we will continue to build our pipeline in 2018 and that we will go after additional high-value disease targets, where new therapies are badly needed by patients.

Our ability to create new potential medicines outstrips our ability to develop them all into marketed products, at least for now.

Therefore, it make sense to do more collaborations, like we did with Amgen last year, for some of our programs.

The world has seen how fast we were able to move over the past 12 months and that the TRiM technology may be optimized to address a variety of target tissues.

So we believe we are well positioned to attract high-quality partners to maximize the number of products we can ultimately get to patients.

It has been a very productive 2017, and we look forward to an exciting 2018.

I would now like to open the call up for your questions.

Operator?

(Operator Instructions) Our first question comes from the line of Katherine Xu with William Blair.

I have a few questions.

First, I was just wondering, given the very interesting data that you saw with the ARC-520, do you think we would need to -- you would need to stop treatment to gather any response?

Or you just keeping treating until you try everything down at the zero(inaudible)?

Or do you think that during the treatment period, you will see that response?

And my second question is, what is the timing of the proof-of-concept for ARO-AAT and ARO-HBV?

Are we going to see the proof-of-concept data in 2018?

And lastly, on the safety side, apparently, this is most important for the new platform.

Can you comment on any incremental information you can provide?

I understand that there was very good therapeutic -- large safety margin in the GLP tox studies.

Any incremental information since then on the GLP tox and other safety aspects?

Okay.

So help me -- let me know if I forget any of the 3 here.

So with respect to the first question about needing to stop treatments with ARO-HBV to see a sustained host response, the answer is we don't know.

That's a good question.

That was certainly not the intention for ARC-520.

We had to discontinue that program, and so we were able to follow a handful of patients after that.

But we'll just have to see.

We think that ARO-HBV is going to be a powerful drug here because it's going to -- it's designed to knock down s-antigen coming off of both cccDNA as well as integrated DNA so it's got a shot of knocking down s-antigen in a more effective way than ARC-520.

We'll just have to see if that bears out in humans.

And if that's the case, the goal right now is to continue to treat and to bring that s-antigen down as well as X and other antigens to a level where the body can take over.

So that's our plan right now.

Could it be that the body needs that jolt of removing therapy?

It's possible, but we just don't know the answer to that at this point.

And so right now, we're just going to -- the plan is to dose for a certain period of time, and then see what we see.

The second question relating -- as I recall, relating to proof-of-concept data for HBV and AAT.

I don't think we want to give too much guidance on that at this point just because we don't know when we can -- when we're going to start dosing.

Once we file those CTAs, we'll let you know.

And then once we start dosing patients, we will also let you know.

Once we're actually dosing patients, I think we can give more granular guidance about when we think that we can start to have data.

So I think it's best for us just to wait until that happens, and then we can talk about it.

As Bruce mentioned, I think we've got really good potential protocols there that would give us early readouts, but we need to ensure that those protocols are approved by regulators and that we can start on -- at a reasonable time.

So we'll let you know as soon as we know on that.

And then the final one with respect to safety, we don't have anything more to say at this point.

We do expect a much wider safety margin with the new TRiM platform than with DPCs.

We are in GLP tox right now.

And so once that's finished, we'll -- again in the clinic, then see where we are.

But we do -- we certainly do expect a good, wide safety margin with that whole platform.

(Operator Instructions) Our next question comes from the line of Elemer Piros with Cantor.

I was wondering maybe if you could help me to understand.

What is it in the new design that makes this version of the RNAi against HBV more efficacious against even-integrated DNA?

Thanks, Elemer.

Bruce, do you want to walk through where the sequences as here, at least broadly?

Yes, sure.

So Elemer, the -- this is an overlapping transcriptome at the 3 prime end, but the X protein is quite short.

And in ARC-520, both of the RNAi triggers were both targeted in that X region.

Now that turns out to be the region that's frequently lost during integration.

So in ARO-HBV, one of the triggers is still in that X region, but the other trigger is quite a ways upstream in the S region and in that part of the DNA that is almost always preserved during integration.

So it's that second trigger being quite safely out of that X region that gives us confidence that ARO-HBV should also knock down the integrated source of us.

(inaudible).

In fact, we created an animal model to try to test that hypothesis as best as we could, and that model gave very good knockdown of the s-antigen even when the X trigger was essentially taken out of the picture.

And let me -- I'll underline add one thing, Elemer.

And I know you recognize this, but I want to make it -- make sure it's clear to others who are on the call.

So when we developed ARC-520, the world didn't appreciate the importance of integrated DNA as a source of s-antigen.

It just wasn't clear.

We discovered that, again, as you know.

And so just by rotten luck, we had both of our sequences in ARC-520 that were in a region that is often lost during integration.

Now it turns out that was actually fortuitous because it enabled us to understand this whole new biological force within the virus.

But the downside, of course, was that we were only knocking down one part of produced s. And so now ARO-HBV, if it works as designed, is not going to have that floor, right?

With ARC-520, we can knock down only so much that was coming off of cccDNA, but it's still left this floor that's being produced by integrated DNA and now the floor is gone.

And so it'll be interesting to see how much knockdown we're able to get with ARO-HBV.

That's -- anyway, so I think that's -- that is important to us again.

And so Bruce, if you compare the data that you just presented at HEP DART, the mice data, was the data with 520 as impressive as this was?

(inaudible)

So for the wild-type DNA model, it was very similar, I would say, between ARC-520 and ARO-HBV.

Although that's mild, that's purely indicative with cccDNA.

At that time, we had not created this mutant plasmid model to knock out that -- our X trigger, so we did not have anything comparable with ARC-520.

We didn't know to build that.

So this is -- but I think with respect to cccDNA-derived transcripts, this would look very similar, I would say, to what was achieved with ARC-520.

And also keep in mind, we're talking about S here, and we think S is important.

But we know that the other gene products are important as well, and so it's important to point out that we're not just knocking down S. We're knocking down, as we mentioned in the prepared remarks, we think everything that this virus is producing, and one of those important ones is X antigen.

Gilead has done some very interesting work that suggests the real importance for X antigen.

So we think that any RNAi therapy that does not knockdown X is going to do it at its peril.

Okay, okay.

And Bruce, in the long-term follow-up data that you've also presented with 520, I think the RNAi product was given 4 to 7 times or 4 to 9 monthly infusions.

At what point was entecavir stopped?

Or was it -- continues?

So entecavir use in these patients.

So they started on one when they got their first dose of ARC-520, and they're still continuing today with entecavir.

So that has not been discontinued.

Okay, okay.

So that probably didn't have an impact on triggering the host response?

No.

Historically, the nukes really do very little for antigenemia.

And the -- in those rare cases, of course, where they do get seroclearance, which is extremely rare, then you see the antigenemia fall.

But for the most part, the nukes are well known to not be very helpful, especially with respect to surface antigen.

Okay, and just the last question to Ken.

Ken, how do you envision the cash burn changing now that you're moving back into the clinic with potentially 5 programs by the end of next year?

So if you look at our history of our cash burn this past year, we spent about $56 million, excluding CapEx.

And the year before that was probably about $10 million additional when we were heavier into the clinic.

So you can look at our historical cash burn when we were in the clinic and expect to see some increase there in 2018.

I'm not showing any further questions in queue at this time.

I'd like to turn the call back to Chris Anzalone for any closing remarks.

Thank you all.

Happy holidays, and we wish you a Happy New Year, and we look forward to seeing you in 2018.

Ladies and gentlemen, thank you for your participation in today's conference.

This concludes the program, and you may now disconnect.

Everyone, have a great day.