Chimerix Inc (CMRX) 2016 Q1 法說會逐字稿

Good morning. Welcome to the Chimerix conference call discussing the financial results of the first quarter for 2016. Please be advised that today's calls is being recorded at Chimerix's request. I would now like to turn the call over to Michele LaSpaluto from the Chimerix team.

Thank you, and welcome to the Chimerix first-quarter 2016 financial results conference call. This morning at 7:30 AM Eastern time we issued a press release containing the financial results and other updates for the first quarter of 2016. The press release is available on the Company's website at www.chimerix.com. You may also access today's call via webcast on the investor section of the Chimerix website, www.chimerix.com.

An archive of the website will be available approximately two hours after the conclusion of the event. On the call with me today are Michelle Berrey, President and CEO; Garrett Nichols Chief Medical Officer; and Tim Trost, Chief Financial Officer.

Before we begin, I would like to remind you that the statements made on today's call include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are subject to risks, uncertainties and other factors, including the possibility that there may not be a viable continued development path for brincidofovir, that the FDA and other regulatory authorities may not approve brincidofovir, or a brincidofovir-based regimen, and that the marketing approval [for brini] may have significant limitations on its use. As a result brincidofovir may not be very successful commercialized. In addition Chimerix may be unable to file for regulatory approval brincidofovir with other regulatory authorities. These risks, uncertainties and other factors could cause the actual results to differ materially. Chimerix has referred to in the forward-looking statements.

You are cautioned not to rely on these forward-looking statements. These risks and uncertainties are described in detail on Chimerix's filings with the Securities and Exchange Commission, including its Form 10-Q filed earlier today, its most recently filed reports on 8-K, and other documents subsequently filed with the Securities and Exchange Commission. All forward-looking statements are based on information currently available to Chimerix, and Chimerix assumes no obligation to update any such forward-looking statements.

At this time, I'd like to turn the call over to our President and CEO, Michelle Berrey.

Good morning, and thank you for joining us. Although we had previously guided to a summer of 2016 announcement regarding the data from AdVise, our 200-patient trial of brincidofovir for the treatment of adenovirus infection, we are pleased to share with you this morning interim data from the 24-week readout from AdVise today. Following the data readout from SUPPRESS earlier this year, we were asked by FDA to provide an earlier top-line assessment from AdVise. As a reminder, the final end-point from AdVise is at week 36, with all patients receiving 12 weeks of open label brincidofovir and then for 24 weeks. All patients will be through week 36 later this summer, and we anticipate sharing data for the end of the year.

We have now treated over 700 patients with adenovirus infection through our clinical trials, expanded access programs and emergency INDs. Although brinci provided through an emergency IND can potentially save the life of a child facing disseminated adenovirus infection it unfortunately does not move us any closer to a regulatory approval. As Garrett will discuss in a moment, we are designing a clinical trial that will hopefully serve that purpose. With strong financial resources and patent exclusivity until 2034, we are well positioned to advance our brincidofovir developing program.

In addition to brinci, we're bringing forward other new medicines for CMV and BK virus, including CMX 669, which anticipate in entering the clinic in late 2016. We also anticipate selection of a clinical candidate for norovirus in 2016.

We continued to make progress in our development of brinci for the treatment of smallpox under the FDA's animal rule. In February we presented positive results from a pivotal study of brincidofovir in the rabbit pox model, which demonstrated 100% survival in animals that received brinci at the time of confirmed infection. We plan to conduct our second animal efficacy study for brincidofovir in the second half of 2016 and we'll follow that with a meeting with the FDA to discuss any additional data that may be required for an approval for the treatment of smallpox.

This morning we will also provide details of our financial performance for the first quarter 2016. I'll turn the call over now to our Chief Medical Officer, Garrett Nichols, for updates on the clinical development of Brinci.

Thank you, Michelle. I'd like to start by providing an update on AdVise, our clinical trial for the treatment of adenovirus. We had previously guided that we would provide an update this summer after the data from AdVise, and our match control study was submitted and the next steps were agreed with the FDA. As I will discuss, we now know that our match control study will not be able to serve as a valid comparator for the AdVise trial. As a result we are designing a randomized comparative trial with brincidofovir that will be our next step in development.

The AdVise study enrolled patients with limited disease or with disseminated infection, independent of the reason for immunodeficiency. We provided interim data on the all-cause mortality and today are sharing what we believe is a significantly lower 90-day and 24-week mortality than what would have occurred in the absence of brinci. And as we've seen with other antivirals, the rapid reduction of adenovirus viremia to below the limit of detection correlates with improved survival.

In August 2015 we completed enrollment of the AdVise trial of brincidofovir as a treatment for serious adenovirus infection. Pediatric and adult patients who have undergone allogeneic stem cell transplants are at especially high risk for serious or fatal adenovirus infections due to profound immunodeficiency. Mortality rates of 50% to 80% have been reported in the literature for disseminated adenovirus disease, with a majority of the mortality seen in the first few months after diagnosis. Patients who enrolled in the AdVise study were placed into Cohort A, B or C based on their underlying immunodeficiency and extent of disease.

Cohort A comprised allogeneic stem cell transplant recipients with asymptomatic or limited adenovirus infection. Cohort B comprised allogeneic stem cell transplant recipients with disseminated adenovirus disease. And Cohort C contained other patients, including autologous stem cell recipients, solid organ transplant recipients and other immunocompromised patients with serious adenovirus infections.

All subjects involved in the AdVise trial received 12 weeks of open label oral brincidofovir and are followed for 24 weeks after completing treatment. Final data will include follow-up through week 36, that's 24 weeks after the last dose of brincidofovir, and will be available in the second half of 2016.

The key top-line results from the AdVise trial at week 24 were as follows. First, brincidofovir rapidly reduced adenovirus levels in the blood, this is adenovirus viral load, in the majority of these highly immunocompromised patients, and even in the patients who had previously received intravenous cidofovir. Rapid reductions in viral load to below the limit of detection were correlated with improved survival at day 90 and at week 24 following diagnosis.

Two-thirds of the subjects in AdVise Cohort B, that's those with disseminated adenovirus disease, were pediatric allogeneic stem cell recipients. Pediatric subjects had a 32% all-cause mortality at day 90 and 42% all-cause mortality at week 24. There was a smaller group of adult allogeneic stem cell transplant recipients in Cohort B and all-cause mortality in adults at day 90 was 57% and at week 24 was 71%.

Clearly upon review of data from AdVise, which is the largest study ever conducted for adenovirus, we now know that adenovirus is a different disease in adults when compared to children. In adults in AdVise, adenovirus disease was diagnosed later after transplant, but paradoxically the enrolled adults also had lower lymphocyte counts at baseline. This suggests that adenovirus is a true opportunistic infection, and a marker of poor immune function in these patients.

There are many other differences between adults and children as well, including the underlying disease that led to transplant. Virtually all adults had cancer, whereas one-quarter of the children were transplanted for congenital immunodeficiencies. And we know that children in general have better outcomes from transplantation.

From an adverse event perspective, discontinuations due to gastrointestinal adverse events were low in the overall population at 8%, and were particularly low in pediatric subjects at 4%. Importantly discontinuations due to graft-versus-host disease were low in both pediatric and adult patients at 3% each.

Last week we reviewed this data with some of the key thought leaders in the top transplant centers in the country who impressed upon us the importance of the rapid virologic responses to below the limits of detection in these patients who were at high risk for progressive adenovirus infection and death. Although the patients in AdVise 12 received weeks of brinci, the course of therapy may be able to be shorter, something that we will be exploring through our ongoing expanded access trial.

As you will recall, we attempted to create a control population for the brinci treated patients by collecting historical match controls from the same centers that enrolled subjects in AdVise. We sought up to three historic controls, matched for age, type of transplant received, and asymptomatic viremia, or disseminated disease for each AdVise subject. This ultimately proved to be difficult for a number of reasons.

First, these controls had to come from a time period when brincidofovir was not being utilized at that center in order to prevent biasing the sample. This meant we had to go back to as early as 2004 in order to find matches for some patients and over one-half of the matches obtained had their adenovirus diagnosis before the year 2009. This of course had implications on the standard of care and the underlying patient mix.

The second problem surrounded diagnosis. Screening and PCR-based testing for adenovirus has been a more recent development. So matches had less information with regards to established end organ disease. Finding cases with documented disseminated disease during a time when many physicians did not consider adenovirus as a potentially fatal infection was problematic. And finally some centers were not able to participate in the match control study at all because their IRBs would not permit collection of data without informed consent, which of course would have biased the sample.

In the end the comparison of outcomes from the AdVise trial subjects with the match controls did not demonstrate a meaningful difference in overall survival. We believe that this is likely due to unmatched characteristics that were observed to be different between the cohorts, but are known to impact mortality such as confirmed end organ disease, the presence of lymphocyte recovery, and graft-versus-host disease. The limited number of matches that were able to be collected also prevented us from controlling for these additional factors in a post hoc analysis. Accordingly we believe, and our advisors agreed, that a valid comparison was not possible.

We are now turning to the development of a comparative trial of brincidofovir in patients serious adenovirus infections that will allow stratification of patients based on risk factors for outcomes. We plan to meet with the FDA in the coming months to review data from the AdVise trial and reach agreement on a regulatory pathway for brinci in adenovirus that will lead to its approval as the first antiviral for this indication. A similar meaning is also planned with European regulatory bodies.

I'd like to point out that the AdVise trial is the largest clinical study ever conducted in serious adenovirus disease. We are facing the challenges that always confront those that attempt to bring forward the first drug to treat a condition. We have learned more about the risk factors and predictors of improved survival in pediatric and adult patients with disseminated adenovirus disease. As we have learned more about the patients who are at high risk for progression of their adenovirus to multiorgan failure and death, we can stratify patients based on these factors and thus demonstrate brinci's antiviral potency and safety in this population. The specifics for a comparative trial of brinci versus the current standard of care will have to be worked out with the FDA, but we believe a successful trial can be agreed and conducted.

Pediatric transplant and infectious disease physicians reaffirmed their belief in brinci last week as we reviewed the outcome of the AdVise trial and the confirmed antiviral potency. Without brinci as a potential treatment for serious adenovirus infections in their stem cell transplant patients, many pediatric patients will have no treatment option for this frequently fatal infection. We continue to see evidence of this need from the ongoing expanded access study 351 and the name patient program, which together have provided brinci to almost 100 patients with serious adenovirus infections thus far in 2016.

I'll now provide a brief regulatory update on brinci for the prevention of cytomegalovirus, or CMV. Following is a review of the results from SUPPRESS, our Phase III trial of brincidofovir for the prevention of CMV in stem cell transplant recipients, and discussion with the FDA. Chimerix selected to close the SUSTAIN and SURPASS trials for the prevention of CMV disease in kidney transplant recipients.

The brinci INV for CMV prevention is currently on a partial clinical hold, pending completion of additional analyses of the SUPPRESS data and their submission to the FDA, which we anticipate will be complete later this summer. In Europe Brinci was given orphan drug designation for the prevention of CMV disease. Orphan drug designations provide 10 years of market exclusivity with an opportunity for another 2 years with a pediatric plan.

I like to finish with an update on IV brincidofovir, which is expected to enter the clinical in the third quarter of this year. We are developing the intravenous formulation of brinci as a potential candidate for the prevention and treatment of CMV and BK virus infection in stem cell transplant and kidney transplant recipients. Preclinical results to date have demonstrated the potential to decrease the GI side effects of orally administered brincidofovir, which could help in the critical first weeks after stem cell transplantation when the GI tract is recovering from conditioning chemotherapy. IV administration of brinci would maintain the other positive attributes of the molecule, including its broad spectrum of activity against the DNA viruses that affect the transplant population and the absence of hemologic or renal toxicity that differentiate brinci from the currently available antiviral options in this space.

Now I'd like to turn this call over to Tim.

Thanks Garrett, and good morning everyone. As Michele LaSpaluto mentioned in her introductory remarks, earlier today we issued a press release containing our financial results for the first quarter of 2016. Starting with our balance sheet, on March 31, 2016 we had approximately $314 million in capital available to fund operations. We're debt-free and had approximately 46.2 million outstanding shares of common stock.

Turning to our statement of operations, Chimerix reported a net loss of $26.3 million, or $0.57 per basic and diluted share for the first quarter of 2016. During the same period in 2015 the Company reported a net loss of $22.3 million, or $0.54 per basic and diluted share. Revenues for the first quarter of 2016 were $1.2 million, which remained consistent with the $1.2 million for the same period in 2015. These revenues relate to our ongoing development contract with BARDA.

Research and development expenses increased to $20.9 million for the first quarter of 2016 compared to $17.4 million for the same period in 2015. This increase was primarily due to increased compensation costs related to both increased headcount versus the first quarter of 2015 as well as a one-time severance cost related to our previously announced reduction to our workforce.

General and administrative expenses increased to $6.9 million for the first quarter of 2016 compared to $6.1 million for the same period in 2015. The increase primarily also relates to increased compensation costs driven by the same factors mentioned for R&D expenses, but was partially offset by a significant decrease in commercial (technical difficulties) costs. Loss from operations was $26.6 million for the first quarter of 2016 compared to a loss from operations of $22.3 million for the same period in 2015, due primarily to the increased research and development and general and administrative expenses as previously discussed.

Looking forward to the remainder of 2016, pending further development decisions, we currently expect both R&D expenses and G&A expenses for the full year 2016 to be lower compared to full year 2015, although there may be unevenness from quarter to quarter. Following the SUPPRESS results, we worked to streamline our cost structure in the first quarter 2016 in order to conserve our capital on hand. Specifically relative 4Q 2015, 1Q we reduced our R&D expenses by $10.6 million, or 34%, and G&A expenses by $2.8 million, or 29%. Thus, we affected a reduction of total operating expenses of $13.5 million, or 33%. With continued vigilance toward controlling our costs, we remain well-capitalized to fund our development path forward with approximately $314 million in available capital at March 31.

Now I'd like to turn the call back to Michelle.

Thank you, Tim. Garrett has provided the mortality data from AdVise as well as important observation of improved mortality in patients who saw a dramatic decline in viremia to below the limit of detection. With improved screening and detection of earlier disease, we're hopeful that some of the patients who began brinci at a point when they were already facing multiorgan failure could be diagnosed earlier at a point when they could still benefit from brinci.

Some of our other key learnings from AdVise were regarding the differences in disseminated adenovirus infection between adult and pediatric patients. Linda and her team have conducted some market research which were consistent with some of these findings in AdVise.

In general, physicians reported that in their adult transplant patients they screen for adenovirus infection only after the emergence of symptoms that could potentially be caused by adenovirus. In children, physicians indicated that they are screening for adenovirus much sooner. This later testing in adults may help explain the differences that we've seen in our mortality rates between adult and pediatric patients.

Adenovirus is an opportunistic infection and its emergence in adult patients may have ramifications that we are just uncovering. Education on the need for earlier screening in adults which could lead to earlier intervention may result in better outcomes in the future. We will be continued our market research efforts to better understand treatment practices regarding both adenovirus and CMV infections.

Regarding our ongoing educational initiative, we continue to highlight the clinical and economic burden of double-string DNA infections in stem cell transplant recipients. In early April at the European BMT conference we presented three abstracts that focused on the burden of CMV, adenovirus and BK virus in this population. In these research efforts we looked at a number of key clinical and economic outcomes, such as length of hospital stay, re-hospitalizations, co-infection and mortality. It's clear that these viruses are associated with increased clinical burden, which naturally translates to increased costs to hospitals and insurers across the continuum of care.

Next month we will presenting new data at ICAAC regarding the treatment of adenovirus infections in solid organ transplant patients with brinci. This population was culled from our expanded access and the AdVise Cohort C patients. Independently physicians from major transplant centers are now sharing their experiences treating a variety of double-stranded DNA viruses with binci, including BK virus and adenovirus.

At the European BMT conference a poster submission from the UK highlighted the experience of two transplant centers in Manchester who had access to brinci via compassionate use. The summary of experience noted that Brinci was effective and well-tolerated in patients with refractory viral reactivations in the post-stem cell transplant setting. Next month at ICAAC information regarding the treatment of BK virus associated nephropathy in allogeneic stem cell transplant patients will be shared by physicians from Beth Israel.

Information like this helps underscore the continued high unmet medical need for therapies that can treat many of these double-stranded DNA viruses that cause considerable morbidity and mortality. We will continue to seek opportunities to share data on brinci's antiviral activity and potential benefits to those underserved populations. We will be working with our advisors and regulators to identify those questions that still is remain for brincidofovir approval and to design a comparative trial that will provide the answers we need to finally have an antiviral that can treat or prevent life-threatening viral infections in children and adults who have undergone stem cell or solid organ transplant.

As we progress discussions with the FDA and European regulators, we will bring you updates on our plan to control study in adenovirus and progress in our smallpox program, and of course for our IV brinci formulation. We continue to explore the optimal use of brinci in all of our key indications, including the development of our IV formulation which is expected to enter clinical studies in the second half of 2016. As Garrett mentioned, the animal studies of IV brinci have continued to show lower potential for the GI side effect that impacted our SUPPRESS study for prevention of CMV.

With that, I'd like to thank you for your participation in the call this morning. And will now open up the call for any questions.

Thank you.

(Operator Instructions)

Katherine Xu, William Blair.

Good morning. Just wondering. So from the day 90 to week 24, there's the increase in mortality. Any thought there on that one?

I'm sorry, Katherine. So the increase in mortality?

Yes (multiple speakers) week 24.

As you're aware, basically this patient population that contracts adenovirus is a highly immunocompromised patient population. Adenovirus is an opportunistic infection in these patients.

And so they're not just at risk for dying from adenovirus, but they're also at risk for dying from a variety of other complications of their transplant including other incident infections. There's a lot of competing risks here. This is not just adenovirus progression, but it is indeed other causes of mortality including relapse of their underlying disease and other non-relapse-related mortality.

So in the match controls you also saw this kind of trend from day 90 to week 24?

Correct. These patients do continue to die of causes due to adenovirus and other causes of death as well.

Okay. So it looks like from the sort of the retrieving sort of coming back to the IV brincidofovir, that seems to be the strategy to go forward next. Just curious, from your strategic planning perspective with the term of you're probably reporting the Phase III data at the end of the year. And then there's some, probably the vaccine from the [cell of the nikell] reading out in the next year or so, what do you see, how do you strategically position yourself in this kind of new competitive landscape?

We continue to believe in brincidofovir's broad spectrum of activity, which really distinguishes it from letermavir and from the CMV vaccine. Those drugs really only have application for the prevention of CMV. But as we've seen from the AdVise trial, these patients are also at risk for other double-stranded DNA viral infections such as adenovirus and BK virus infection. So ultimately we do believe that our drug brings opportunities even in that competitive set.

Thank you.

Thanks, Katherine.

Jessica Fye, JPMorgan.

Hey, guys. This is Ryan on for Jess. Thanks for taking our questions. When you're thinking about a potential prospective study design in adenovirus, is there a particular group that you focus on? I'm guessing that would be the disseminated group.

And when you're thinking about the design would it be both pediatric and adult separately? Or would you look at them together?

That is an excellent question, and that's something we're examining at the moment, is really trying to understand as much as we can from this data set and then further interrogating the literature with this largest ever conducted interventional trial in adenovirus. A lot of those characteristics are going to be important, looking at the time after transplant that they get adenovirus infection, looking at their baseline lymphocyte count, looking at adults versus pediatric patients. Really trying to hone in on what are those conditions, what are those underlying adenovirus disease states where brinci can make the biggest difference.

It may be patients with multiple organ systems involved or those patients that basically have, for example, respiratory disease as a particular area of focus because outcomes with respiratory disease are very, very poor with regards to currently available therapy.

These are all things for us to look at. This study has given us the ability to learn a lot about what the risk factors are and where brinci can be most effective.

Okay, great. Sorry if I misheard you, but I thought you had said in your prepared remarks that you're exploring a -- potentially exploring a shorter duration in adenovirus? Could you help me understand what the potential advantage of using a shorter therapy is? It seemed like it -- that it was fairly well tolerated.

So I think that the learning here is that the adenovirus response rates, which have been described to be extremely slow with currently available IV cidofovir, are actually very rapid with brincidofovir. We clear the virus from patients quickly. So accordingly, it is quite possible that shorter courses would be effective. And also result in better outcomes at the end of the day. We're looking at the duration of therapy as one key thing to explore in further studies.

Okay. Great. Thank you.

Mark Fram, Cowen and Company.

Hi. Thanks for taking my questions. One thing about this upcoming controlled adenovirus trial. Do you think you have enough information, both from the historical data you did gather and then the literature to power a pivotal trial? Or do you need to run a Phase II to kind of -- in a placebo-controlled setting to figure out what a pivotal powering would be?

A placebo-controlled trial would be a difficult design to support, given the high mortality that's associated with adenovirus infection. So really what we're looking at is something similar to what we attempted to do with the historical controls, which is to compare against the current available standard of care. But the difference is that we would be able to randomize patients in that setting to balance some of those imbalanced areas.

That's really what a randomized trial is able to do, is to control for. And we can take our learnings from the AdVise study to stratify patients to ensure that we've got good balance in those factors that are highly correlated with mortality. So in essence what were looking at is a comparison with current available standard of care, which is predominately IV cidofovir, but focusing in on those disease areas and those patient populations that will be able to demonstrate the biggest benefit with brinci.

But do you think that next trial could be pivotal, or do you still need more information to design the pivotal?

No. I think we can design the pivot with information that we have gained.

Okay. And then can your remind us exactly what the restrictions are with the partial hold, and exactly what the FDA is -- and disclose in terms of what the FDA is looking for to list that?

As you're aware, a partial clinical hold is the suspension of just part of the clinical work that's conducted under the IND. For example, with a specific protocol. Other protocols or other areas are allowed to proceed.

We don't have any restrictions on our adenovirus program. so this is really just restricted to the CMV IND. We are conducting additional analyses that were requested by the FDA. We'll provide those to the FDA later on this summer and have a discussion with them about next steps for the development of brinci for CMV.

Okay. Thanks. And then finally where do things stand on negotiating a contract with BARDA for the smallpox indication for stockpiling?

I will take that one. We are still hopeful that we can reopen those negotiations within the FY16. I've -- they have been pretty busy looking at the Zika virus outbreak and trying to find some monies to continue to explore both the causality, the link with some of the serious CNS events in adults, and certainly with the pregnancy-related complications.

So we are hopeful that can go forward for smallpox. Clearly there is still a need for us to have a compound in the strategic national stockpile that could address a smallpox bio weapon event.

Okay. Thank you.

Thank you.

Yigal Nochomovitz, Citi.

Hi. This is Yan for Yigal Nochomovitz from Citi. Thank you for taking my question. I have two questions. First, could you provide some more details of the trial results? For example, what was the strength of correlation between viral load decline and OS viral rate? And in the press majority of patients was undetectable [ming]. But what about other patients? Do they see treatment benefit?

Second question is about still upcoming advance trial design. What's your initial thought about the compared to arm in the new trial? Thank you.

Thanks for your question. So those will be topics for later presentations. But as a reflective with the initial question, what we've looked at is antiviral responses in correlation with overall mortality. In patients that have disseminated disease, there's really not much -- nowhere else for them to go except to either live or die. There's no intermediate endpoint for patients with disseminated disease.

The correlation with rapid virologic response and overall survival is a good one. There are obviously patients that have rapid virologic response and end up dying of other causes as well. So that's a part of the reason why some patients end up expiring, not due to adenovirus-associative disease but due to competing risk for mortality.

In terms of the next study, I think that this is going to be a discussion with the FDA in terms of getting into the specifics. But in broad strokes what we're thinking is a randomized comparative study of brincidofovir oral for patients with serious adenovirus disease and compared to the current standard of care, which is primarily cidofovir-based. The details of the inclusion/exclusion criteria, et cetera will be a subject of discussion with the FDA.

Okay. Great. Thank you.

Yes.

Matthew Harrison, Morgan Stanley.

This is Cyrus on for Matthew. Thanks for taking my call. Going to these upcoming FDA meetings, what do you see as your project filing options? Do you have a timeline for these upcoming meetings? Thanks.

So as far as the next discussion, we have previously guided that we would be communicating the results of the AdVise and the match controls together with the path forward in the summertime. That remains the date. We're looking to the summer to have conversations with them with regards to this data set. And our next communication will be with regards to our agree path forward with the FDA.

But going into these discussions, do you have any idea of what sort of filing options you're going to be pushing for? Or is that sort of up in the air?

We believe that given the historical match control did not provide us with a valid comparator, that we need to do is now conduct a randomized comparative study in order for us to demonstrate the benefits that brinci brings to serious adenovirus infections and disease.

Okay. Thank you.

Josh Schimmer, Piper Jaffray.

Thanks for taking the questions. Sorry if any are redundant. Hopped on late. First on the smallpox trial, what's the gating step to initiate the second animal study?

So our next study will be in the mouth model with ectromelia. And right now we are working closely with colleagues at BARDA to confirm what the lethal inoculum would need to be for those animals. And soon as that is completed, which should be in the very short term, we'll be able to get that study kicked off.

Is that not known from other drugs for smallpox?

It is, but each time that these studies are conducted they need to be reconfirmed to make sure that you have the right inoculum for those. It's generally very small for the ectromelia strain. So very small inoculum leads to lethality. But we need to reconfirm that for each trial.

Okay. And the AdVise trial, was there any relapse of adenovirus activity post the continuation of brincidofovir after 12 weeks? And if so, did that lead to any of the mortality beyond that time point?

There are patients who relapsed because of persistent immunodeficiency. However, as a part of the AdVise trial they were able to be retreated with brincidofovir. So that is an important factor for us to look at in terms of overall responses, is whether relapse basically was associated with poor outcomes. We would expect that patients that have persisted immunodeficiency that persisted after 12 weeks of brincidofovir are going to have bad outcomes.

Got it. And then for the historical control match, I guess which weren't really matched, can you not go back and try to more accurately match them? Or do you only get one shot to define the historical parameters and compare (technical difficulties) with the trial?

That is a good question. The difficulties that we've had in conducting the matches and the difficulties in finding these patients at the centers from a period of time before brinci was available have showed us that this is probably not going to be the best path forward for us in order to get a regulatory approval, and really for us to show the benefits that brinci brings. Randomization may be the best way forward.

Okay. Thank you.

Thank you, Josh.

Stephen Willey, Stifel.

Thanks for taking the questions. Maybe this is a follow-up to the last point. I think you did talk about one of the headwinds regarding the historical control matching was most of these institutions were already using brinci, hence the need to go back to, I think, in 2014 in some cases. As you think about running a prospective study, how many of those top transplant centers that you would be looking at are actively requesting brinci for compassionate use basis for the treatment of adeno? And how do you think that might impact the ability to enroll such a study? Thanks.

It's a great question. This is certainly one of the challenges in conducting the study. The easy response is that we need to conduct this study in order to prove the benefits that brinci brings. At the time that we stand up a trial for patients who qualify for the trial, they would no longer be able to receive brinci via compassionate use.

The criteria for study 351, or EINDs, would be to changed such that they would not be able to the receive it that way. They would be receiving access to brinci via the clinical trial that we design. So that is -- I think that our conversations with our advisors last week, they understand the reason for this trial now. The situation is such that this is what we need to do to fulfill the next step. And we'll design that trial to achieve its result as quickly as we possibly can so that we can move forward to filing for brinci.

Okay. And maybe just one other question, which is more curiosity. On the immune reconstitution front, do you feel like an absolute lymphocyte count is adequate? Or do you need to go beyond that and look at something like a lymphocyte-typing? Thanks.

Yes, it's a really great question. Absolute lymphocyte count is something that's pretty well described in the literature, but certainly there's more information which is being published with regards to the CD4 counts. We do have CD4 counts data as a part of our data set as well, which were similarly unbalanced in the analysis that we did with match controls.

CD4 count is an important predictor in general for response to antiviral therapy. But interestingly in the patients who were treated with brinci, even those patients that had very low CD4 counts responded to Brinci virologically. These are factors that we will be looking for as potential baseline factors to stratify patients upon in order to ensure that we have a good balance between the standard of care and brinci in our comparative trial.

Okay. Thanks for taking the questions.

Thank you.

Thank you. I'm not showing any further questions on the phone lines. Ladies and gentlemen, thank you for participating in today's conference. This does conclude today's program. You may all disconnect. Everyone have a great day.

Thank you. Good bye.