Atossa Therapeutics Inc (ATOS) 2023 Q2 法說會逐字稿

Good morning, ladies and gentlemen. Thank you for standing by, and welcome to Atossa Therapeutics Q2 2023 conference call. Please be advised, today's conference is being recorded.

早上好，女士們，先生們。感謝您的耐心等待，歡迎參加 Atossa Therapeutics 2023 年第二季度電話會議。請注意，今天的會議正在錄製中。

I would now like to hand the conference over to your first speaker today, Eric Van Zanten, Vice President of Investor and Public Relations. Mr. Van Zanten, you may begin.

現在我想將會議交給今天的第一位發言人，投資者和公共關係副總裁埃里克·範·贊滕 (Eric Van Zanten)。 Van Zanten 先生，您可以開始了。

Thank you, [Kevin]. Good morning, everyone and welcome to Atossa's second-quarter 2023 corporate and financial update conference call. Earlier this morning, we issued a press release providing an overview of our recent corporate highlights and financial results for the quarter ended June 30, 2023. The press release can be accessed on the investor portion of our website at investors.atossatherapeutics.com.

謝謝你，[凱文]。大家早上好，歡迎參加 Atossa 2023 年第二季度企業和財務更新電話會議。今天上午早些時候，我們發布了一份新聞稿，概述了我們最近的公司亮點和截至2023 年6 月30 日的季度的財務業績。您可以在我們網站的投資者部分訪問該新聞稿：investors .atossatherapeutics.com。

Joining me on the call today are Dr. Steven Quay, Atossa's President and Chief Executive Officer; and Greg Weaver, our Executive Vice President and Chief Financial Officer.

今天和我一起參加電話會議的是 Atossa 總裁兼首席執行官 Steven Quay 博士；以及我們的執行副總裁兼首席財務官 Greg Weaver。

During today's call, we will be making certain forward-looking statements which are subject to risks and uncertainties that may cause actual results to differ materially from the anticipated or estimated future results. These forward-looking statements are based on current information, assumptions, and expectations that are subject to change.

在今天的電話會議中，我們將做出某些前瞻性陳述，這些陳述存在風險和不確定性，可能導致實際結果與預期或估計的未來結果存在重大差異。這些前瞻性陳述基於當前信息、假設和預期，可能會發生變化。

The description of potential risks can be found in our latest SEC disclosure documents and our press release. You're cautioned not to place undue reliance on these forward-looking statements, and Atossa disclaims any obligation to update these statements.

潛在風險的描述可以在我們最新的 SEC 披露文件和新聞稿中找到。請您注意不要過分依賴這些前瞻性陳述，並且 Atossa 不承擔更新這些陳述的任何義務。

I will now turn the call over to Dr. Quay.

我現在將把電話轉給奎伊博士。

Thank you, Eric, and thank you to everyone who joined the call today. I'm very proud of the progress we've made in Q2. From a clinical perspective, each of the three ongoing Phase 2 trials, investigating our proprietary (Z)-endoxifen, reached important milestones.

謝謝你，埃里克，也感謝今天加入電話會議的所有人。我對我們在第二季度取得的進展感到非常自豪。從臨床角度來看，正在進行的三項 2 期試驗（研究我們的專有 (Z)-endoxifen）均達到了重要的里程碑。

I'll start with the Karisma-Endoxifen trial, which is a randomized, double-blind, placebo-controlled efficacy study of oral endoxifen in pre-menopausal women with measurable breast density. This is a single-site trial at the Karolinska Institute in Stockholm led by Dr. Per Hall, one of the world's foremost authorities in breast cancer epidemiology.

我將從 Karisma-Endoxifen 試驗開始，這是一項針對具有可測量乳腺密度的絕經前女性口服 Endoxifen 的隨機、雙盲、安慰劑對照療效研究。這是斯德哥爾摩卡羅林斯卡研究所進行的一項單中心試驗，由全球乳腺癌流行病學最權威的權威之一 Per Hall 博士領導。

Participants in this study are randomized into one of three cohorts to receive placebo, 1 milligram, or 2 milligrams of endoxifen daily. Participants will take endoxifen for six months. Over the course of which, mammograms are conducted to measure reduction in breast density. Patients will also have a mammogram at 24 months to assess the durability of density changes.

這項研究的參與者被隨機分為三個隊列之一，每天接受安慰劑、1 毫克或 2 毫克的艾多昔芬。參與者將服用艾多昔芬六個月。在此過程中，進行乳房X光檢查以測量乳房密度的減少。患者還將在 24 個月時接受乳房 X 光檢查，以評估密度變化的持久性。

Last month, we announced that 70% or 170 of the anticipated 240 patients have been enrolled in the trial. We expect the study to fully enroll in the fourth quarter of this year and data to be available in mid 2024.

上個月，我們宣布預期 240 名患者中的 70%（即 170 名）已參加試驗。我們預計該研究將於今年第四季度全面入組，數據將於 2024 年中期提供。

Mammographic breast density is a growing health crisis. Between 40% and 50% of all women are estimated to have mammographically dense breasts and there are currently no approved treatments. Cancer and dense breast tissue both appear white on a mammogram, which makes mammography less sensitive and more difficult to interpret. As a result, cancers are often larger, more advanced, and more difficult to treat when found in women with dense breast tissue.

乳房X光檢查乳腺密度是一個日益嚴重的健康危機。據估計，40% 至 50% 的女性擁有乳房 X 光檢查顯示的緻密乳房，但目前尚無批准的治療方法。癌症和緻密乳腺組織在乳房 X 光檢查中均呈白色，這使得乳房 X 光檢查靈敏度較低且更難以解釋。因此，當在乳腺組織緻密的女性中發現癌症時，癌症通常更大、更晚期並且更難以治療。

Additionally, mammographic breast density is a strong independent predictor of breast cancer risk. And women with the highest density are four to six times more likely to develop breast cancer compared to women with the least dense breasts. Our vision for endoxifen in the mammographic breast density setting is to both make mammograms more reliable and decrease the risk that women with dense breast tissue will develop cancer in their lifetimes.

此外，乳房X線照相乳腺密度是乳腺癌風險的一個強有力的獨立預測因子。與乳房密度最低的女性相比，密度最高的女性患乳腺癌的可能性高出四到六倍。我們對乳房 X 光檢查乳腺密度設置中的 Endoxifen 的願景是使乳房 X 光檢查更加可靠，並降低乳腺組織緻密的女性一生中患癌症的風險。

In addition to our MBD trial, there are two additional ongoing Phase 2 trials investigating endoxifen in the neoadjuvant setting, which is the window of time between the diagnosis and the primary treatment, which with estrogen-sensitive breast cancer is almost always surgery plus radiation and/or chemotherapy.

除了我們的MBD 試驗之外，還有另外兩項正在進行的2 期試驗，研究新輔助治療中的恩多昔芬，這是診斷和主要治療之間的時間窗口，對於雌激素敏感的乳腺癌，幾乎總是手術加放療和/或化療。

The intent of neoadjuvant therapy is to slow the cancer growth or even shrink the cancer prior to surgery. Doing this makes surgery more effective and, with breast cancer, may alter the surgical approach, being some patients could have a lumpectomy instead of a mastectomy. Neoadjuvant therapy has also been shown to reduce the likelihood that the cancer returns.

新輔助治療的目的是在手術前減緩癌症生長甚至縮小癌症。這樣做可以使手術更加有效，並且對於乳腺癌，可能會改變手術方法，因為一些患者可以進行腫瘤切除術而不是乳房切除術。新輔助治療也被證明可以降低癌症復發的可能性。

The first of the two neoadjuvant trials investigating endoxifen is being conducted through the I-SPY network, which is a collaborative effort among academic investigators from major cancer research centers across the United States. The I-SPY trial is enrolling newly diagnosed pre- and post-menopausal women with estrogen-receptor-positive breast cancer.

調查恩多昔芬的兩項新輔助試驗中的第一項是通過 I-SPY 網絡進行的，該網絡是來自美國主要癌症研究中心的學術研究人員的合作成果。 I-SPY 試驗正在招募新診斷出患有雌激素受體陽性乳腺癌的絕經前和絕經後女性。

As a reminder, about 80% of all breast cancers are ER positive. Patients in this study receive daily treatment with 10 milligrams of endoxifen for up to 24 weeks prior to surgery. This is a smaller trial with only 20 subjects expected to participate. And we announced in June that the trial was already 30% enrolled. Given the size of the I-SPY network, which includes 41 of the largest cancer centers in the United States, we expect full enrollment either later this year or in early 2024.

提醒一下，大約 80% 的乳腺癌是 ER 陽性。這項研究中的患者在手術前長達 24 週內每天接受 10 毫克艾多昔芬治療。這是一項規模較小的試驗，預計只有 20 名受試者參與。我們在 6 月份宣布試驗已經有 30% 的入組率。鑑於 I-SPY 網絡的規模（其中包括美國 41 個最大的癌症中心），我們預計今年晚些時候或 2024 年初將實現全面註冊。

The third Phase 2 trial is the EVANGELINE study, which was profiled at the American Society of Clinical Oncology meeting in Chicago in June. This is also a neoadjuvant study, although different from the I-SPY trial as only pre-menopausal women are being enrolled.

第三項 2 期試驗是 EVANGELINE 研究，該研究於 6 月在芝加哥舉行的美國臨床腫瘤學會會議上進行了介紹。這也是一項新輔助研究，儘管與 I-SPY 試驗不同，因為僅招募絕經前女性。

The EVANGELINE trial will enroll up to 175 women. The primary objective is to evaluate the endocrine-sensitive disease rate, measured by Ki-67 after four weeks of treatment with endoxifen, compared to treatment with current standard of care, which consists of an aromatase inhibitor plus ovarian function suppression.

EVANGELINE 試驗將招募多達 175 名女性。主要目的是評估內分泌敏感性疾病的發生率，與當前標準護理（包括芳香酶抑製劑加卵巢功能抑制）的治療相比，用艾多昔芬治療 4 週後通過 Ki-67 測量。

Ki-67 is a measure of tumor cell proliferation or how fast the tumor is growing. The importance of this is that studies have shown that Ki-67 above 10% at the time of surgery confers a higher risk of recurrence and a worse survival rate in patients with early breast cancer.

Ki-67 是腫瘤細胞增殖或腫瘤生長速度的衡量標準。其重要性在於，研究表明，手術時 Ki-67 高於 10% 會導致早期乳腺癌患者復發風險更高，生存率更差。

The EVANGELINE trial started with a six-patient, pharmacokinetic run-in cohort, which was designed to determine if the 40-milligram dose delivers steady-state plasma levels of between 500 and 1,000 nanograms per milliliter, which is the optimal to target protein kinase C beta inhibition and enhanced endoxifen's anti-tumor mechanism of action.

EVANGELINE 試驗從 6 名患者的藥代動力學磨合隊列開始，旨在確定 40 毫克劑量是否能提供每毫升 500 至 1,000 納克的穩態血漿水平，這是靶向蛋白激酶的最佳劑量Cβ抑制和增強endoxifen的抗腫瘤作用機制。

We already know that endoxifen binds to estrogen receptors in breast cells and stops the body's own natural estrogen from attaching to them. This cuts off the cancers fuel source and prevents it from growing and spreading. By further targeting PKC beta, we expect endoxifen to have an even greater anti-tumor effect by both blocking the estrogen receptor and by inducing apoptosis, which is a cellular equivalent of a self-destruct button. This is where we could see not only slower progression, but also a reduction in the size of the tumor.

我們已經知道，endoxifen 與乳腺細胞中的雌激素受體結合，並阻止人體自身的天然雌激素附著在它們上。這切斷了癌症的燃料來源並防止其生長和擴散。通過進一步靶向 PKC beta，我們預計 Endoxifen 通過阻斷雌激素受體和誘導細胞凋亡（相當於細胞自毀按鈕）而具有更大的抗腫瘤作用。在這裡，我們不僅可以看到進展減慢，而且腫瘤尺寸也減小。

We recently received data from the initial 40-milligrams-per-day PK run-in cohort. As with our previous trials, no treatment-related safety or tolerability issues were identified. While the 40-milligram-per-day dose was well tolerated, it did not achieve optimal plasma concentrations, which means, per the protocol, we are in the process of initiating a second dose level at 80 milligrams. Based on concentration levels achieved at 40 milligrams per day, we expect the 80-milligram-per-day dose will deliver the desired steady state plasma concentrations.

我們最近收到了最初每天 40 毫克 PK 磨合隊列的數據。與我們之前的試驗一樣，沒有發現與治療相關的安全性或耐受性問題。雖然每天 40 毫克的劑量耐受性良好，但它沒有達到最佳血漿濃度，這意味著根據方案，我們正在啟動 80 毫克的第二劑量水平。根據每天 40 毫克的濃度水平，我們預計每天 80 毫克的劑量將達到所需的穩態血漿濃度。

Efficacy data was also captured as part of the PK run in, including Ki-67 at baseline and at four weeks and MRIs taken at diagnosis and again after 12 weeks of treatment. We are extremely encouraged by these results, and we hope to share them in detail at an upcoming medical conference.

作為 PK 運行的一部分，還捕獲了療效數據，包括基線和 4 週時的 Ki-67，以及診斷時和治療 12 週後再次採集的 MRI。這些結果讓我們深受鼓舞，我們希望在即將召開的醫學會議上詳細分享這些結果。

Before I turn things over to Greg for a financial update, I wanted to touch on one additional project that we have recently announced, which is our research partnership with Weill Cornell Medicine in New York City to study the potential of inducing estrogen receptor expression in triple-negative breast cancer.

在我向格雷格匯報財務最新情況之前，我想談談我們最近宣布的另一個項目，即我們與紐約市威爾康奈爾醫學公司的研究合作夥伴關係，以研究在三重體內誘導雌激素受體表達的潛力。 -陰性乳腺癌。

The term triple-negative breast cancer refers to the fact that the cancer cells don't have either estrogen or progesterone receptors and also don't make any of the other receptors, including the human epidermal growth factor receptor 2, or HER2 protein. The tumor cells does test negative on all three tests.

三陰性乳腺癌一詞是指癌細胞不具有雌激素或孕激素受體，也不產生任何其他受體，包括人類表皮生長因子受體 2 或 HER2 蛋白。腫瘤細胞在所有三項測試中均呈陰性。

Triple-negative breast cancer, or TNBC, accounts for about 10% to 15% of all breast cancers. And it differs from other types of invasive breast cancer in that it tends to grow and spread faster, has fewer treatment options, has a higher risk of recurrence, and tends to have a worse prognosis.

三陰性乳腺癌（TNBC）約佔所有乳腺癌的 10% 至 15%。它與其他類型的浸潤性乳腺癌不同，它生長和擴散速度更快，治療選擇更少，復發風險更高，而且預後往往更差。

The goal of the research we are doing with Weill Cornell is to determine if treating TNBC with extracellular vesicles carrying the estrogen receptor will change the cancer's phenotype and turn on the estrogen receptor. Converting the tumor to ER-positive would make it sensitive to hormone therapy, including treatment with (Z)-endoxifen. This has fundamentally transformed the treatment approach and outlook for these patients.

我們與威爾康奈爾大學合作進行的研究的目的是確定用攜帶雌激素受體的細胞外囊泡治療 TNBC 是否會改變癌症的表型並開啟雌激素受體。將腫瘤轉化為 ER 陽性將使其對激素治療敏感，包括 (Z)-內多昔芬治療。這從根本上改變了這些患者的治療方法和前景。

With that, I'll turn things over to Greg. Greg recently joined us as CFO, but he knows the company extremely well having served on the Board for over 10 years. He is a seasoned financial executive with over 30 years of experience leading finance, operations, and business development at several publicly traded biotech companies.

這樣，我就把事情交給格雷格了。 Greg 最近加入我們擔任首席財務官，但他在董事會任職超過 10 年，對公司非常了解。他是一位經驗豐富的財務主管，在多家上市生物技術公司領導財務、運營和業務開發方面擁有 30 多年的經驗。

I am thrilled to have him as part of our executive team, and we'll turn things over to him for a financial update. Greg, take it away.

我很高興他成為我們執行團隊的一員，我們將把財務最新情況交給他。格雷格，把它拿走。

Thank you, Steve. Thank you to everyone for joining today's call. This is our first earnings call as we reinvigorate our communications with investors, and these quarterly calls will be an important pillar of that going forward.

謝謝你，史蒂夫。感謝大家參加今天的電話會議。這是我們重振與投資者溝通的第一次財報電話會議，這些季度電話會議將成為未來的重要支柱。

From my perspective as an investor of Atossa, this is a pivotal time for the company with Phase 2 trials in multiple settings. (Z)-endoxifen is positioned to read out data over the next 12 to 18 months, providing investors with the opportunity to join in the value creation and innovation for breast cancer patients.

從我作為 Atossa 投資者的角度來看，對於該公司在多種環境下進行第二階段試驗來說，這是一個關鍵時刻。 (Z)-endoxifen 的定位是讀取未來 12 至 18 個月的數據，為投資者提供參與乳腺癌患者價值創造和創新的機會。

And looking ahead strategically, our clinical development strategy for the breast density (inaudible) and for breast cancer indications includes forming alliances for future Phase 3 development and commercialization. So as the clinical data continues to mature, one of the key objectives we have is to build relationships with prospective partners. And brokering alliances is something I've done previously in my career, and I look forward to leveraging that experience here at Atossa.

從戰略上展望未來，我們針對乳腺密度（聽不清）和乳腺癌適應症的臨床開發戰略包括為未來的 3 期開發和商業化建立聯盟。因此，隨著臨床數據的不斷成熟，我們的關鍵目標之一是與潛在合作夥伴建立關係。促成聯盟是我之前在職業生涯中做過的事情，我期待著在 Atossa 充分利用這些經驗。

Okay. Let's turn to the financial update. Beginning with cash the end of Q2, total cash position was $99.4 million as compared to $104 million at March 31 and $111 million at year end 2022. The six-month year-to-date change in cash was $11.5 million, $4.5 million used in Q2, $7 million in Q1.

好的。讓我們轉向財務更新。從第二季度末的現金開始，現金頭寸總額為9,940 萬美元，而3 月31 日為1.04 億美元，2022 年年底為1.11 億美元。年初至今六個月的現金變化為1,150 萬美元，其中450萬美元用於第二季度，第一季度 700 萬美元。

So as we model cash runway going forward, you can clearly see the multi-year resources available to drive our multiple Phase 2 clinical programs through their next significant value inflection points and through to completion. The strong cash position we have is also strategically important longer term, as we position ourselves to invest in a Phase 3 registration trial and potentially to consider adding to the pipeline.

因此，當我們對未來的現金跑道進行建模時，您可以清楚地看到可用於推動我們的多個二期臨床項目通過下一個重要價值拐點直至完成的多年資源。我們擁有的強勁現金狀況從長遠來看也具有重要的戰略意義，因為我們準備投資第三階段註冊試驗，並可能考慮增加管道。

Let's move to the comparison of the three-month numbers ended June 30. The total operating expenses is $7.8 million for the three months ended June 30, an increase of $1.2 million for the three months ended June 30 of the prior year. R&D expense for the three months ended June 30, 2023, $3.7 million compared to $3.4 million same quarter prior year, the increase of just under $300,000 primarily due to increased spending on clinical trials and non-clinical activities.

讓我們比較一下截至6 月30 日的三個月的數字。截至6 月30 日的三個月的總運營費用為780 萬美元，比上一年截至6 月30 日的三個月增加了120萬美元。截至 2023 年 6 月 30 日止三個月的研發費用為 370 萬美元，而上年同期為 340 萬美元，增加近 30 萬美元，主要是由於臨床試驗和非臨床活動支出增加。

G&A expense for the three months ended June 30 was $4.1 million compared to $3.2 million for the same quarter prior year, the increase of just under $1 million due to G&A compensation expense which increased primarily due to severance costs to our former CFO and the increase in overall compensation, along with legal and professional fees increasing due primarily to higher patent activity for (Z)-endoxifen and higher investor relations and accounting fees.

截至6 月30 日的三個月，一般及行政費用為410 萬美元，而上年同期為320 萬美元，由於一般及行政費用補償費用增加了近100 萬美元，該費用的增加主要是由於我們前首席財務官的遣散費以及總體薪酬以及法律和專業費用的增加主要是由於 (Z)-endoxifen 專利活動的增加以及投資者關係和會計費用的增加。

Interest income was $1 million for the three months ended June 30, a sharp increase compared to prior year due to a higher average invested balance and higher earned interest rates. And non-cash charges in the second quarter included an impairment charge we booked for $2.9 million on an investment and dynamic cell therapies, or DCT, and a non-cash stock compensation charge of $1.6 million.

截至 6 月 30 日的三個月，利息收入為 100 萬美元，由於平均投資餘額較高和賺取利率較高，與去年同期相比大幅增加。第二季度的非現金費用包括我們在投資和動態細胞療法（DCT）上登記的 290 萬美元的減值費用，以及 160 萬美元的非現金股票補償費用。

And finally, on the quarterly numbers, a net loss of $9.8 million for the second quarter compared to the net loss of $6.3 million in the first quarter and $6.7 million for the comparative second quarter of last year.

最後，從季度數據來看，第二季度淨虧損為 980 萬美元，而第一季度淨虧損為 630 萬美元，去年第二季度淨虧損為 670 萬美元。

Pivoting to the six months ended June 30 numbers, total operating expenses of $14.9 million for the six months, which is an increase of $3.5 million from the prior year, with R&D expenses for the six months of $7.2 million compared to $4.9 million for the same quarter prior year, the increase of $2.3 million due primarily to increased spending of roughly $1.8 million related to (Z)-endoxifen clinical trial costs and increased API, drug product formulation, and development costs; also due to fluctuations in R&D compensation expense attributable to non-cash stock-based comp; and a decrease in some year-over-year costs related to prior-year payments, which were made to establish alliances with several research institutions.

截至6 月30 日的六個月數據顯示，這六個月的總運營費用為1,490 萬美元，比上一年增加了350 萬美元，這六個月的研發費用為720 萬美元，而去年同期的研發費用為490 萬美元。與去年同期相比，增加了230 萬美元，主要是由於與(Z)-endoxifen 臨床試驗成本相關的支出增加了約180 萬美元，以及API、藥品配方和開發成本的增加；還由於非現金股票補償帶來的研發補償費用的波動；與上一年付款相關的一些同比成本有所下降，這些費用是為了與幾個研究機構建立聯盟而支付的。

Pivoting to G&A expenses for the six months ended June 30, a total of $7.7 million, an increase of $1.3 million compared to the prior year of $6.4 million, with the key fluctuations again being the compensation expense increase in part attributable to the increase in overall compensation of approximately $900,000; a decrease in non-cash stock-based comp; and an increase in the severance costs for our exiting CFO. And also again, legal and professional fees increased due to higher activity in both areas.

截至 6 月 30 日的六個月的一般管理費用總計為 770 萬美元，比上一年的 640 萬美元增加了 130 萬美元，其中主要波動再次是補償費用的增加，部分原因是總體收入的增加約90萬美元的賠償；非現金股票補償減少；以及現任首席財務官的遣散費增加。此外，由於這兩個領域的活動增加，法律和專業費用也有所增加。

Interest income for the six months, $1.8 million, also increased related to higher average balances invested and higher average interest rates. The non-cash charges for the six months included the Q2 impairment charge on the investment in DCT and non-cash stock compensation.

六個月的利息收入為 180 萬美元，也因平均投資餘額增加和平均利率上升而增加。這六個月的非現金費用包括 DCT 投資第二季度的減值費用和非現金股票補償。

The net loss for the six months was $16.1 million, and that compared to the net loss of $11.5 million year to date, prior year.

這六個月的淨虧損為 1,610 萬美元，而去年年初至今的淨虧損為 1,150 萬美元。

And then one additional topic that touch on is that we announced a share repurchase program in June to purchase up to $10 million shares of our common stock. This program is authorized through the year end 2023, and the rationale for the program is to recognize, in our view, the disconnect in the market value of Atossa shares.

另外一個涉及的話題是，我們在 6 月份宣布了一項股票回購計劃，購買最多 1000 萬美元的普通股。該計劃的授權截止日期為 2023 年底，我們認為該計劃的理由是認識到 Atossa 股票市值的脫節。

In Q2 2023, we purchased just under 120,000 shares of stock at a cost of approximately $150,000. And to date, we've purchased approximately 840,000 shares for $1 million. This activity has no material impact on our operating cash runway.

2023 年第二季度，我們以約 15 萬美元的成本購買了近 12 萬股股票。迄今為止，我們已斥資 100 萬美元購買了大約 840,000 股股票。這項活動對我們的運營現金跑道沒有重大影響。

Thank you for your attention. I'll turn the call back to Steve. Steve?

感謝您的關注。我會把電話轉回給史蒂夫。史蒂夫？

Steve, you're on mute.

史蒂夫，你處於靜音狀態。

I'm sorry. Can you hear me?

對不起。你能聽到我嗎？

Yeah. You're good now.

是的。你現在很好。

(multiple speakers)

（多個發言者）

Thank you, Greg. And from a clinical development perspective, we expect to see data from all three of our ongoing Phase 2 trials over the next 12 to 24 months. This data, along with feedback from the FDA, will allow us to design Phase 3 protocols, which will support strategic business development alliances.

謝謝你，格雷格。從臨床開發的角度來看，我們預計將在未來 12 至 24 個月內看到所有三個正在進行的 2 期試驗的數據。這些數據以及 FDA 的反饋將使我們能夠設計第三階段協議，這將支持戰略業務發展聯盟。

Short term, you can expect to hear from us with enrollment updates and other developments. You should also expect these quarterly update calls to continue, with our next one being our Q3 call in November.

短期內，您可以期待收到我們關於招生更新和其他進展的消息。您還應該預計這些季度更新電話會議將繼續進行，我們的下一次電話會議是 11 月的第三季度電話會議。

I'd now like to ask the operator to open the call for Q&A. Thank you, operator.

我現在想請接線員打開問答電話。謝謝你，接線員。

Thank you. (Operator Instructions) Jason McCarthy, Maxim Group.

謝謝。 （操作員說明）Jason McCarthy，Maxim Group。

Hey there. Sorry about that. It took me a second to get off mute there. This is Michael Okunewitch on the line for Jason. Thank you so much for taking my questions today.

嘿。對於那個很抱歉。我花了一秒鐘才擺脫沉默。我是邁克爾·奧庫內維奇，正在接聽傑森的電話。非常感謝您今天回答我的問題。

Greetings, Michael.

問候，邁克爾。

Thank you.

謝謝。

All right. So I guess first off, I just like to see -- with the Karisma-Endoxifen trial approaching full enrollment by year end and completion on 2024, can you just remind us? Is there some certain level of density reduction or some upper threshold you need to cross in order to consider it a meaningful result, where you'll get an improvement, early detection, or reduction in incidence of breast cancer? I'm trying to get how you evaluate a meaningful reduction in breast density.

好的。所以我想首先，我只是想看到——隨著 Karisma-Endoxifen 試驗在年底前全面入組並於 2024 年完成，您能提醒我們嗎？您是否需要跨越一定程度的密度降低或某個上限閾值才能將其視為有意義的結果，從而獲得改善、早期發現或降低乳腺癌發病率？我想了解您如何評估乳房密度的有意義的降低。

Yeah, that's a great question, Michael. There are two main measures of density on the mammograms themselves. And then, I'll discuss the concept of statistical significance and clinical significance, which comes up in every single clinical trial of any drug you'd be involved with.

是的，這是一個很好的問題，邁克爾。乳房X光照片本身有兩種主要的密度測量方法。然後，我將討論統計顯著性和臨床顯著性的概念，這些概念出現在您所參與的任何藥物的每一項臨床試驗中。

So first, the measurement endpoint. Radiologists have, for almost two decades, used a ABCD categorization of, approximately, quartiles, where A is the lowest density and D is the highest density. There's an abundance of research results looking at those density measurements and, for example, the effect on sensitivity of finding cancers, the effect on five-year incidence of cancers going forward. So the long history in mammographic density is that ABCD categorization.

首先是測量終點。近二十年來，放射科醫生一直使用 ABCD 近似四分位數分類，其中 A 是最低密度，D 是最高密度。有大量研究結果著眼於這些密度測量，例如，對發現癌症的敏感性的影響，對未來五年癌症發病率的影響。因此，乳房 X 光密度的悠久歷史就是 ABCD 分類。

Now we've gotten to the point where we now have 5, 10 cleared measurements, which are quantitative. The machine does it for you with software. Those give you a score from 0 to 100. And so we have less long-term experience with those, but they do map onto what you'd expect, where a radiologist is calling a breast A and the machine calling it 0 to 25, 26 to 50, 51 to 75, 76 to 100. So the biggest winners are when you cross the threshold between groups because that's the highest level.

現在我們已經有了 5、10 個明確的測量值，這些測量值都是定量的。機器通過軟件為您完成此操作。這些給你的分數從 0 到 100。所以我們對這些的長期經驗較少，但它們確實符合你的期望，放射科醫生將乳房稱為 A，機器將其稱為 0 到 25， 26 到50、 51 到75、76 到100。所以最大的贏家是當你跨過組之間的門檻時，因為那是最高級別。

Statistical significance will probably require a pretty small amount. Perhaps 3% or 4% will be enough. The breast -- in these pre-menopausal women, the breast will be changing less than 1% per year. When they get near menopause, you'll see a 5% or 6% drop over a couple of years. So statistical significance would be a couple of percent. Clinical significance will be larger drops and perhaps changes in the ABCD categorization.

統計意義可能需要相當小的數量。也許3%或4%就足夠了。乳房——在這些絕經前的女性中，乳房每年的變化不到 1%。當她們接近更年期時，您會發現幾年內下降了 5% 或 6%。因此統計顯著性將是幾個百分點。臨床意義將是 ABCD 分類的較大下降和可能的變化。

All right. Thank you for that. I do appreciate the additional clarity there. And then in terms of the EVANGELINE study, I'd like to see how many sites you plan to open in Canada. And how many would that bring it to a total?

好的。謝謝你。我確實很欣賞那裡的額外清晰度。然後，就 EVANGELINE 研究而言，我想了解一下您計劃在加拿大開設多少個網站。那麼總共有多少呢？

Yeah. I mean, we have one site in Canada, which was the requirement for getting the filing and getting permission to go forward there. And we'll continue to recruit additional trials. And we are always recruiting trials -- centers into this trial on an ongoing basis. So we haven't disclosed the number of centers that are open currently. But there is a website that you can go to if you have patients with pre-menopausal, ER-positive breast cancer, the EVANGELINE trial website.

是的。我的意思是，我們在加拿大有一個站點，這是獲得備案並獲得在那裡繼續前進的許可的要求。我們將繼續招募更多試驗。我們一直在招募試驗——持續進行該試驗。所以我們還沒有透露目前開放的中心數量。但是，如果您患有絕經前 ER 陽性乳腺癌患者，您可以訪問一個網站，即 EVANGELINE 試驗網站。

All right. Thank you. Then one last one for me, and I'll hop back into the queue. So you guys have a fairly impressive [cap] balance right now. Are there any plans to expand the earlier mid-stage pipeline with additional M&A? Or are you focused on deploying that capital pretty much purely to get this current status studies to those readouts over the next 12 to 24 months?

好的。謝謝。然後給我最後一張，然後我會跳回隊列。所以你們現在擁有相當令人印象深刻的[上限]平衡。是否有計劃通過額外的併購來擴大早期的中期管道？或者您是否專注於部署該資金，純粹是為了在未來 12 至 24 個月內將當前狀態研究結果轉化為讀數？

Yeah. Thanks, Michael, great question. I'm going to let Greg weigh in on that if he would.

是的。謝謝，邁克爾，很好的問題。如果格雷格願意的話，我會讓他權衡一下。

Happy to. Michael, a great question. We're blessed with a very strong balance sheet. And as I look at it in my first weeks here is the CFO, it really strategically positions us to not only fully fund the current protocols, execute on the trials that we've just discussed in full to and through completion. But it appears to me that there's additional bandwidth here to seriously consider adding to the pipeline.

高興。邁克爾，一個很好的問題。我們很幸運擁有非常強大的資產負債表。正如我在首席財務官任職的第一周所看到的那樣，它確實在戰略上使我們不僅能夠為當前的協議提供充分資金，而且能夠執行我們剛剛全面討論的試驗直至完成。但在我看來，這裡還有額外的帶寬需要認真考慮添加到管道中。

And so as we go forward, we'll be just, with some discretion, having a look, to be honest. And I would just say we don't have any disclosures at this time except that there's an intent to take a look at the landscape and see what might be a good strategic fit for us.

因此，當我們前進時，說實話，我們將謹慎地進行觀察。我只想說，我們目前沒有任何披露，只是有意了解一下情況，看看什麼可能是適合我們的戰略。

All right. Thank you very much and congrats on the progress this quarter.

好的。非常感謝並祝賀本季度取得的進展。

Excellent. Thanks for joining us.

出色的。感謝您加入我們。

Edward Woo, Ascendiant Capital.

吳宇森，Ascendian Capital。

Yeah. Congratulations on the progress. My question is on dynamic cell therapy. What drove the impairment charge this quarter?

是的。祝賀取得的進展。我的問題是關於動態細胞療法。是什麼推動了本季度的減值支出？

Yeah. Thank you for your question. I'll let Greg go into that. It's a financial analysis exercise.

是的。謝謝你的問題。我會讓格雷格來討論這個問題。這是一項財務分析練習。

Yeah. Thank you and good morning. The dynamic cell therapies investment was made into their CAR T business as a strategic investment second half of last year. The accounting treatment for GAAP is to take a look at the fundamentals of the actual business under investment.

是的。謝謝你，早上好。動態細胞療法投資作為去年下半年的戰略投資納入了他們的 CAR T 業務。公認會計準則的會計處理是考察所投資的實際業務的基本面。

And in this case, what the accountants considered the cash runway for that investment business is less than a year. And as they looked at that, they ran it through their parameters for investment carrying value on the balance sheet and recommended an impairment charge to be booked against it.

在這種情況下，會計師認為該投資業務的現金跑道不到一年。當他們看到這一點時，他們通過資產負債表上的投資賬面價值參數進行了分析，並建議根據其記入減值費用。

So it's a non-cash valuation. We still think that there's value in that investment and continue to carry it going forward.

所以這是一個非現金估值。我們仍然認為這項投資有價值，並將繼續向前推進。

Great. And then my next question is on that three trials that is going on right now. How would you characterize patient enrollment? Is it expected, faster, or slower than you expected?

偉大的。我的下一個問題是關於目前正在進行的三項試驗。您如何描述患者入組的特點？它比你預期的快還是慢？

It's a good question. I've got seven approved drugs and about 30 clinical trials under my belt. And I can say pretty definitively that there's a high correlation between good enrollment and a successful drug after FDA approval in marketing.

這是一個好問題。我已經獲得了 7 種批准的藥物和大約 30 項臨床試驗。我可以相當肯定地說，良好的入組率與 FDA 批准上市後的成功藥物之間存在高度相關性。

So with respect to the I-SPY trial and neoadjuvant, we've already -- we indicated that we had 30% enrollment within a couple of months. The trial in the Karolinska Institute in breast density, accruing right on schedule despite the Swedish culture, I guess, where they take a full month off in the summer, for example, things like that. So it's enrolling very well.

因此，關於 I-SPY 試驗和新輔助療法，我們已經表明，幾個月內我們的入組率達到了 30%。卡羅林斯卡學院的乳房密度試驗按計劃進行，儘管瑞典的文化，我猜，他們在夏天休息一個月，諸如此類的事情。所以招生情況非常好。

And there's a buzz about the trial, the EVANGELINE trial happening at the Mayo Clinic. Because -- again, we're trying to see if we can step into the standard of care, which is effective and safe, but has a quality-of-life issue. So it's sort of the third leg of a stool tool in clinical development with ovarian function suppression.

關於該試驗，即在梅奧診所進行的 EVANGELINE 試驗，引起了熱議。因為——我們再次嘗試看看是否可以進入有效且安全的護理標準，但存在生活質量問題。因此，它是臨床開發中具有抑制卵巢功能的糞便工具的第三條腿。

So that is the standard of care now, but it produces an extremely strong decrement in the standard of care for these patients. We're seeing if our endoxifen is so strong in stopping the estrogen receptor that it can tolerate the upregulation of estrogen that happens in women that have functioning ovaries in the presence of hormonal therapy.

這就是現在的護理標準，但它對這些患者的護理標準產生了極大的降低。我們正在觀察我們的內多昔芬在阻止雌激素受體方面是否如此強大，以至於它可以耐受在激素治療下卵巢功能正常的女性中發生的雌激素上調。

So if we can achieve the same equivalent efficacy, the same safety profile, and an improved quality of life, it will be a game changer. So all three of the trials have the non-statistically significant addition of being really strong trials.

因此，如果我們能夠實現相同的等效功效、相同的安全性和改善的生活質量，這將改變遊戲規則。因此，所有三項試驗都具有非統計顯著性的附加特徵，即它們都是非常強大的試驗。

Great. Well, thanks for answering my questions. And I wish you guys good luck. Thank you.

偉大的。嗯，謝謝你回答我的問題。我祝你們好運。謝謝。

Thank you.

謝謝。

I'm not showing any further questions at this time. I'd like to turn the call back over to Dr. Quay for any closing remarks.

我目前不會提出任何進一步的問題。我想將電話轉回給奎伊博士，讓他作結束語。

Well, I want to thank everyone for listening and to our analysts for their questions. We appreciate the support and look forward to next quarter's call with you in November. Until then, take care and you can now disconnect.

好吧，我要感謝大家的聆聽以及我們分析師提出的問題。我們感謝您的支持，並期待在 11 月與您下個季度的電話會議。在那之前，請小心，您現在可以斷開連接。

This concludes today's conference call. Thank you for joining us. You may now disconnect your lines and have a wonderful day.

今天的電話會議到此結束。感謝您加入我們。您現在可以斷開線路並度過美好的一天。