Cytokinetics Inc (CYTK) 2007 Q4 法說會逐字稿

Good afternoon and welcome, ladies and gentlemen, to the Cytokinetics fourth quarter and year-end 2007 conference call. At this time, I would like to inform you that this call is being recorded and that all participants are in a listen-only mode. (Operator Instructions).

I will now turn the call over to Sharon Surrey-Barbari, Cytokinetics Senior Vice President and Finance and CFO. Please go ahead, madam.

Thank you. Good afternoon, and thank you for joining the Cytokinetics senior management team on this conference call to discuss our fourth-quarter and year-end 2007 results. Also present during this call our James Sabry, our Executive Chairman of the Board; Robert Blum, our President and Chief Executive Officer; and Dr. Andrew Wolff, Senior Vice President of Clinical Research and Development and Chief Medical Officer.

Following the forward-looking statement disclaimer, Robert will provide an overview of the past quarter and Andy will provide highlights and details of the progress of the Company's clinical development program. I will then review the Company's financial performance for the fourth quarter and year end, as well as the Company's financial guidance for 2008 and James will provide a few comments about his evolving role at the Company. Robert will then review our past quarter's research activities and then closed call with our projected Company milestones for 2008. We will then open up the call for a brief question-and-answer session.

The following discussion, including our responses to questions, contains certain statements that constitute forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Examples of such statements include, but are not limited to statements relating to our financial guidance for 2008; the expected conduct, initiation, timing, scope, enrollment, progress, and results of our and our partners' research and development programs; our research and development milestones for 2008 and anticipated dates of clinical trial data release; the potential benefits of our drug candidates and potential drug candidates; the utility of different dosing schedules for ispinesib and SB-743921; our provision to Amgen of clinical data to inform its decision whether to exercise its options under our collaboration agreement and our ability to draw down on our committed equity financing facility with Kingsbridge Capital; our financial resources as of the 2007 fiscal year end being sufficient to fund our operations for nearly 24 months thereafter; and our ability to generate new drug discovery and development program. These statements involve a number of risks and uncertainties that could cause actual results and the timing of events to differ materially from those anticipated by these forward-looking statements. These risks and uncertainties include a variety of factors, some of which are beyond our control. These forward-looking statements speak as of today. You should not rely on them as representing our views in the future, and we undertake no obligation to update the statements after this call.

Please refer to our SEC filings, including our recent quarterly report on Form 10-Q, for a more detailed description of the risk factors that may affect our results, as well as our earnings release posted our Web site and filed with the SEC on Form 8-K. Copies of these documents may be obtained from the SEC or by visiting the Investor Relations section of our Web site.

Now I will turn the call over to Robert.

Thank you, Sharon. 2007 was a year of execution for Cytokinetics as we continued to advance our three development programs in key proof of concept clinical trials.

To remind you, our novel drug candidates are directed to the potential treatment of cancer and heart failure. 2007 was also important, in that we were pleased to see our fourth drug candidates, GSK-923295 or GSK-295, the first inhibitor of centromere-associated protein E, or CENP-E, move into first time in humans clinical trials under the sponsorship of our partner GlaxoSmithKline or GSK.

During the most recent quarter Company in our cardiovascular clinical program, we continued to enroll patients in our clinical trials program for CK-1827452 or CK-452, our novel cardiac myosin activator. This program is comprised of Phase I and Phase IIa clinical trials. With many of these trials now having been initiated, others will be initiated this year. We anticipate data to be available from our currently ongoing, recently completed, and other still to be initiated trials of CK-452 throughout 2008.

In the fourth quarter, we initiated another Phase I trial and readied for the initiation of two additional Phase IIa trials. Andy will provide additional details on the status of these trials during his portion of this call. We remain enthusiastic about this novel drug candidate's potential.

Within our oncology portfolio, we continue to advance ispinesib and SB-743921 or SB-921, our inhibitors of kinesin spindle protein, or KSP. At the end of December, we executed on plans to conduct a focused development program for our lead cancer drug candidate, ispinesib, with the initiation of a Phase I/II clinical trial for the potential treatment of breast cancer. In addition, during the quarter, Cytokinetics presented interim data for SB-921 for the potential treatment of non-Hodgkin and Hodgkin lymphoma at the American Society of Hematology or ASH meeting. These data highlighted the potential utility of a more dose-dense treatment schedule. We believe that the interim data support that a once-every-two-weeks dosing schedule has demonstrated a substantially greater dose density than that demonstrated to be effective on a previously studied schedule of once every three weeks. We are evaluating this same more dose-dense dosing regimen in our newly initiated clinical trial of ispinesib in breast cancer. Lastly, as to our fourth drug candidate, GSK-295, GSK continues to enroll patients in a Phase I clinical trial.

We continue to view research as a key contributor to Cytokinetics' future success. Our research engine continues to be productive, even as we advance our development programs. We believe that having multiple research programs is a key component to our long-term sustainability, and has repeatedly delivered significant value appreciation for biopharmaceutical companies and also balances the inherent risk of drug development.

In 2007, my first year as President and CEO, our solid team at Cytokinetics has laid the groundwork for what we believe should be an eventful 2008.

Now, as Andy, Sharon, and James will further outline for you, we believe that we are well positioned to deliver on our goals for 2008, both from the perspective of our clinical development programs and overall financial position. With that, I will turn the call over to Andy.

Thank you, Robert. As you just heard, we are pleased to see the clinical programs from both therapeutic areas progress during the past quarter, highlighted by the initiation of our proof of concept clinical trial with ispinesib in breast cancer and the initiation of an additional Phase I clinical trial for CK-452.

Now let me offer you further insight and details. I will begin with our cardiovascular program. We continue to move forward on our CK-452 clinical trials program with ongoing or planned trials aimed at developing both an intravenous and an oral formulation of CK-452 for the potential treatment of heart failure.

I'll first inform about the status of our first multicenter double-blind randomized placebo-controlled dose escalation trial designed to evaluate the safety, tolerability, pharmacodynamics, and pharmacokinetic profile of an intravenous formulation of CK-452 in patients with stable heart failure.

We initiated this trial in April 2007, and anticipate completing treatment of the second cohort by the end of the first quarter of this year. The rate of enrollment of the second cohort, as predicted on our last earnings call, was faster than that of the first cohort, and has picked up as we added additional sites in the past few months. Consequently, we anticipate that subsequent cohorts will enroll at a similar rate.

We currently have two Phase I clinical trials underway and another just recently completed. In December, we initiated our fifth Phase I clinical trial with CK-452, a single-center two-part open label trial of up to 12 healthy male volunteers.

The primary objective of this trial is to assess the pharmacokinetics and relative bioavailability of three different oral modified release prototypes of CK-452. The secondary objective of this trial is to determine whether there is an effective food on the pharmacokinetics of these oral modified release prototypes of CK-452. We also continue to enroll subjects in a single-center open-label sequential parallel group Phase I clinical trial designed to evaluate the potential for certain drug-drug interaction which CK-452.

In December, we completed enrollment and are currently awaiting data from a Phase I clinical trial of CK-452 which progressed from a single blind single dose phase to a randomized double-blind placebo-controlled multidose trial. The objective of this trial was to evaluate the pharmacokinetics of an oral formulation of CK-452 in healthy volunteers.

Now switching to our oncology clinical development program, in December, we announced the initiation of an open-label nonrandomized Phase I/II clinical trial designed to evaluate ispinesib as monotherapy as a first-line treatment for chemotherapy-naive patients with locally advanced or metastatic breast cancer. The Phase I portion of the trial is designed to determine the dose-limiting toxicity and maximum tolerated dose, or MTD, of ispinesib administered as a one-hour intravenous infusion on days one and 15 of a 28-day cycle. This is a more dose-dense regimen than that previously studied, which we believe may help to amplify the signal of clinical activity observed in the initial Phase II clinical trial conducted by GSK.

The Phase II portion of our Phase I/II trial is designed to assess the overall response rate of ispinesib at the MTD determined in Phase I patients with measurable locally advanced or metastatic breast cancer, who have not received prior chemotherapy. It is important to note that we will be examining both response rate and duration of response in this trial.

Also during the fourth quarter, the National Cancer Institute, or NCI, continued to enroll patients in a Phase I clinical trial designed to evaluate the safety, tolerability, and pharmacokinetics of ispinesib as monotherapy administered on days one, two, and three of a 21-day cycle to adult patients with relapsed or refractory acute leukemias, chronic myelogenous leukemia in blast crisis, or advanced myelodysplastic syndrome.

In addition, the NCI continue to enroll patients in a Phase I clinical trial designed to evaluate the safety, tolerability, pharmacokinetics, and pharmacodynamics of ispinesib as monotherapy administered as a one-hour infusion on days 1, 8, and 15 of a 28-day schedule to pediatric patients with relapsed or refractory solid tumors.

Turning to SB-921, in December, investigators presented a poster at the 2007 American Society of Hematology meeting summarizing interim data from a Phase I/II clinical trial evaluating its novel small molecule inhibitor of KSP in patients with non-Hodgkin or Hodgkin lymphoma. The authors concluded that SB-921 was well-tolerated without prophylactic granlocyte colony stimulating factor at doses less than 6 milligrams per meter squared when given on days one and 15 of a 28-day schedule.

This more frequent dosing schedule is one that we feel may be better for this drug candidate than previously studied dosing schedules. To date, the best response observed in this trial has been a partial response in a patient with Hodgkin lymphoma at 6 milligrams per meter squared. In this interim analysis, grade three or four neutropenia was the most common toxicity reported, and grade three or four non-hematological toxicities have been rare. In particular, there has been no evidence of neuropathy. We continue to enroll and dose-escalate patients in the phase one portion of this important Phase I/II clinical trial.

During the fourth quarter, GSK continue to enroll and dose-escalate patients in a Phase I open-label nonrandomized dose-finding trial designed to investigate the safety, tolerability, pharmacokinetic and pharmacodynamic profile of GSK-295 in patients with advanced solid tumors. GSK-295 is the third novel drug candidate to arise from Cytokinetics' broad strategic alliance with GSK.

With that, let me turn the call back over to Sharon, who will detail our fourth quarter and year-end 2007 financials, as well as provide financial guidance for 2008.

Thank you, Andy. This has been an eventful year and quarter for Cytokinetics. For the fourth quarter ending December 31, 2007, our net loss was $13.3 million or $0.27 per share as compared to a net loss for the same period in 2006 of $15.9 million or $0.41 per share.

Revenues from research and development collaborations for the fourth quarter were $3.1 million compared to $0.2 million for the same period of 2006. Revenues for the fourth quarter of 2007 were largely derived from license revenue of $3.1 million from our collaboration and option agreement with Amgen. Revenues in the fourth quarter of 2006 were primarily derived from our research collaborations and license agreements with Amgen and GSK.

Total research and development R&D expenses in the fourth quarter of 2007 were $14 million compared to $13 million for the same period in 2006. The increase in R&D expenses in the fourth quarter of 2007 compared to the same period in 2006 was primarily due to increased spending related to our clinical trials program and higher laboratory and personnel expenses.

From a program perspective for the fourth quarter of 2007, approximately 38% of our R&D expenses were attributable to our cardiac contractility development and research activities; 11% to our mitotic kinesin development and research activities; and 43% to our other research programs. Our other research programs include our programs directed towards smooth and skeletal muscle contractility.

Total G&A expenses were $4.1 million for the fourth quarter of 2007 and 2006. The fourth-quarter spending when compared to the same period in 2006 reflected a decrease in legal fees, which was offset by an increase in personnel expenses.

Revenues from research and development collaborations for the 12 months ended December 31, 2007 were $13.6 million compared to $3.1 million for the same 12-month period in 2006. The increase in collaborative research revenues for 2007 compared to the same period in 2006 was primarily the result of the recognition of $12.2 million of license revenue from Amgen. Revenues for the 12 months ended December 31, 2006 were largely derived from our collaboration and license agreement with GSK.

Total R&D expenses for the 12 months ended December 31, 2007 were $53.4 million compared to $49.2 million for the same 12-month period in 2006. The increased spending in 2007 compared to the same period in 2006 was primarily due to increased spending related to our clinical trials programs, preclinical outsourcing costs, and higher personnel and facilities expenses.

From a program perspective for the full year 2007, approximately 42% of our R&D expenses were attributable to our cardiac contractility development and research activities; 11% to our mitotic kinesin development and research activities; and 40% to our other research programs, including our programs directed toward smooth and skeletal muscle contractility.

Total G&A expenses for the 12 months ended December 31, 2007 were $16.7 million compared to $15.2 million for the same 12-month period in 2006. The increased spending in 2007 compared to the same period in 2006 was primarily due to increased personnel expenses and higher facilities and outsourcing costs, partially offset by lower legal fees.

The net loss for the 12 months ended December 31, 2007 was $48.9 million or $1.03 per share compared to a net loss for the same 12-month period in 2006 of $57.1 million or $1.56 per share.

As of December 31, 2007, our cash, cash equivalents, restricted cash, and marketable securities totaled $144.9 million.

I now would like to provide our GAAP financial guidance for 2008. Our revenue guidance for 2008 is $12 million. R&D expense guidance is in the range of $62 million to $67 million. And G&A expense guidance is in the range of $20 million to $21 million. This financial guidance includes an estimated $9 million of non-cash related expense for 2008.

During the quarter, we entered into a committed equity financing facility with Kingsbridge Capital, or Kingsbridge, a private investment group, in which Kingsbridge committed to provide up to $75 million of capital over a three-year period through the purchase of newly issued shares of our common stock at a discount ranging from 6% to 10% depending on the average market price during an eight-day pricing period.

Under the terms of the agreement, we can, subject to certain conditions and limitations, determine the exact timing and amount of any drawdowns. We have established the Kingsbridge line to provide an available source of capital in the event that are unable to otherwise access the financial markets, whether as a result of general market conditions or because our clinical timeliness may shift or unexpected events may occur in our development programs that would delay what we believe could otherwise be financeable events for us.

That concludes the financial portion of today's call. And with that, I will now turn the call over to James.

Thank you, Sharon. At the end of March of this year, I will be transitioning towards a part-time position within the Company. Beginning in the second quarter of 2008, my responsibilities at Cytokinetics will focus on chairing the Board of Directors and the scientific advisory board. In addition, I will consult the Company on certain other matters.

As I reflect back in time back at this time on the past 10 years of building and leading Cytokinetics, I am struck by three things that give me great pride. Firstly, the Company has steadfastly stuck to its business plan of discovering and developing novel small-molecule therapeutics that may address serious diseases, such as cancer and heart disease. The combination of superb science, drug discovery, and clinical development has led to our impressive array of drug candidates and potential drug candidates presently in clinical trials and in the laboratory being prepared for clinical trials respectively. We remain convinced that innovation is the key to delivering medicines to patients that can change the outcome of their disease.

Secondly, the passion of the scientists, clinicians, and business and operations people at Cytokinetics for truly benefiting the patient has been unwavering. This was true in those first few scientists we hired in 1998, and it is true today of those people joining Cytokinetics. In the end, it will be their dedication that will be responsible for the medicines that we may deliver.

And finally, the leadership team at Cytokinetics continues to be an effective and driven group that marks the path for the Company and its stakeholders -- I could not be more proud of them -- many of whom are on this call today. I will leave the Company in excellent leadership hands as I transition to the role of Chairman of the Board.

In 2008, we will maintain our focus toward delivering clinical trial results in both our cardiovascular and oncology program, while at the same time working to ensure a growing and sustainable pipeline of drug candidates.

I would now like to turn the call over to the leader of our team, Robert Blum, who will provide an overview of the shorter term deliverables as well as clinical trial timelines and other thoughts on the Company's activities in 2008.

Thank you, James, and thank you for your valuable contributions to the Company over the past 10 years. The solid foundation upon which we are now prosecuting several clinical stage novel drug development programs, while also continuing to innovate and research is a continuing tribute to your leadership and vision for cytoskeletal pharmacology, first laid out in early plans for the Company over 10 years ago. We look forward to your assistance in continuing to build the Company, and thank you for all that you have done for Cytokinetics.

Before I move onto the milestones for 2008, let me briefly highlight some of the research presentations that were made this past quarter. In December, we presented a poster relating to CK-452 at the 47th Annual American Society of Cell Biology meeting in Washington, D.C. The authors concluded that CK-452 increases myocyte contractility by increasing the duration of contraction with no increase in intracellular calcium. In addition, the poster contains data indicating that CK-452 in combination with isopreternol increases contractility with no further increase in calcium transient, and in contrast, isopreternol does not resulting phosphor relation of the calcium-altering protein phospholamban.

Moreover, the authors conclude that the CK-452-induced increase in contractility is unaffected by beta blockade. These results suggest that due to the novel mechanism of action, CK-452 and similar cardiac myosin activators are independent of the beta-adrenergic pathway.

In October, two posters were presented at the AACR-NCI-EORTC International Conference on Molecular Targets and Cancer Therapeutics relating to GSK-295. The first poster contained data identifying the molecular determinants of sensitivity to GSK-295. The authors concluded that certain cell lines are sensitive to apoptosis following mitotic arrest with disinhibitor of CENP-E, and that heterogeneity of response was observed.

The second poster contained data indicating that GSK-295 elicits a dose-dependent metaphase arrest in replicating tumor cells, followed by an associated increase in apoptosis. The authors concluded that this novel drug candidate is active against a broad panel of both solid and hematologic tumor lines in cell culture.

As you have just heard, on both the clinical and preclinical fronts, Cytokinetics continues to move ahead. Looking at 2008, within our cardiovascular program, in the first quarter of 2008, the Company anticipates completing the treatment phase for the second cohort of patients in our ongoing Phase IIa clinical trial of an intravenous form of CK-452 in stable heart failure patients. In the first half of 2008, the Company anticipates interim data to be available from this trial. We anticipate final data to be available from this trial during the second half of 2008.

In the first half of 2008, we anticipate initiating an additional Phase IIa clinical trial of CK-452 designed to evaluate an intravenous form of CK-452 in stable heart failure patients undergoing cardiac catheterization.

In the first half of 2008, we anticipate initiating an additional Phase IIa clinical trial of CK-452 designed to evaluate an intravenous form, together with an oral formulation of CK-452 in patients with ischemic cardiomyopathy.

In 2008, we anticipate data to be available from ongoing and recently completed Phase I trials of CK-452. As enrollment progresses in 2008 for all of the previously mentioned clinical trials, we anticipate providing updated guidance on the timing and availability of data.

In our oncology program, in 2008, we anticipate data from clinical trials of ispinesib from our second ASP inhibitor, SB-921, as well as our CENP-E inhibitor, GSK-295 as follows.

In the first half of 2008, we anticipate final data to be available from GSK's Phase Ib clinical trial evaluating ispinesib in combination with capecitabine. In 2008, we anticipate data to be available from the Phase I portion of the ongoing Phase I/II clinical trial of ispinesib as monotherapy as a first-line treatment in chemotherapy-naive patients with locally advanced or metastatic breast cancer.

In the first half of 2008, we anticipate final data to be available from the Phase I portion of our ongoing Phase I/II clinical trial of SB-921 in patients with non-Hodgkin or non-Hodgkin's lymphoma. In 2008, we anticipate data to be available from GSK's Phase I medical clinical trial of GSK-295 in advanced solid tumors.

The anticipated timing of the availability of data from GSK's clinical trials is based on information provided by GSK. And therefore, the occurrence of these events is outside of our control. Again, as enrollment progresses in 2008 for all of the previously mentioned clinical trials, we anticipate providing updated guidance on the timing and availability of data.

In research, we anticipate advancing at least one additional potential drug candidate for entrance into IND enabling studies in 2008. We anticipate that this potential drug candidate may arise from currently lead compound optimization activities directed to smooth or skeletal muscle contractility. These activities are directed towards potential treatments for hypertension, bronchial construction, and other diseases.

And finally, on the corporate front, we anticipate providing the required clinical data from our CK-452 Phase IIa clinical trials program to Amgen in the second half of 2008 in order to inform the potential exercise of Amgen's option under the strategic alliance between the companies.

As I said at the introduction to this call, this quarter, as well as the full year 2007, was a period of executing on the steps necessary to deliver important clinical trials data in 2008. As we have described for you, Cytokinetics expects data from multiple clinical trials across several drug development programs throughout 2008.

Now, as I approach the end of my first year as President and CEO, I'm pleased with where Cytokinetics is well positioned across multiple drug development programs. Moreover, we are in solid financial shape, ending 2007 with nearly 24 months of cash based on our currently anticipated burn rate.

Lastly, we continue to believe in the innovative research being conducted at Cytokinetics each day, and are optimistic for our prospects to further expand our development portfolio with another potential drug candidate in the coming year.

That concludes the formal portion of our call today. And I'd now like to open the call up to questions, please.

(Operator Instructions). Michael Aberman, Credit Suisse.

My question is in regard to timing of 452, and maybe also I can ask James a follow-up on that as well. 16 patients is my understanding -- eight patients per cohort, in almost 12 months. For a disease that is not an ultra-rare disease -- and I think a lot of investors expressed significant frustration with the pace of this. And while -- I'd like to know what specifically happened to cause it to go so slow? What actions have been done to make it go faster? How can we be convinced that it's going to pick up?

And I'd like to know from James -- looking back a year ago when you were starting this trial, what were the internal expectations delivered to the Board, and what were the reasons if those weren't met? And how did the board react to that kind of timeline?

Michael, I'm going to try to tackle that one at a time. You asked a lot of different questions there. But let's start with the design of the trial and what were our expectations. And I'm going to turn this over to Andy Wolff. But I do think that your question is a fair one, but I think it makes sense to evaluate the pace of enrollment relative to the actual design.

In terms of evidence that the pace of enrollment is increasing, I think you only need to look at what has been the pace of enrollment in the second cohort compared to the first cohort, that having benefited from the addition of clinical trial sites throughout the second half of 2007.

But let's start with the design of the trial, because I do think that maybe you are asking a good question, but not necessarily aligned with what is expected of patients in this trial.

Thanks, Robert. The disease is a common disease, absolutely. The trial requires patients, however, to come into the study center and be admitted and stay overnight four separate times. So it's a rather intensive time commitment for the patients. And it's not something that every patient is willing to do.

Doing the trial that way means that we get excellent data from studying a patient at three different dose levels as well as on placebo. So that we need to recruit fewer patients overall.

It might be a fair question to ask then, well, why didn't you design the trial differently so that the patients each had to come in only once and be studied on placebo or one of the three doses? That would have required us to get an equivalent power to detect changes in ventricular function four times as many patients, or maybe even more than four times as many patients. And it was our judgment, confirmed in our discussions with our consultants and investigators, that the data would be cleaner and it would probably be easier to enroll eight patients per cohort than it would be to try to enroll 32 patients per cohort. I'm concerned we might still be enrolling the first cohort.

As Robert says, enrollment has picked up considerably as we've added more sites. I think there's another thing as well that we don't point out as often, but I think as trials begin to get going and people get experience with the trial, there's always a resistance to putting the first patient in, because it is a new thing. People aren't familiar with it. And as each center gets through their first patient, there's less activation energy to enroll the second and third and fourth.

So Robert has pointed out that the second cohort enrolled far more quickly than did the first. And I believe you will continue to see those kinds of rates of enrollment, if not slightly better than what we've done for cohort two.

So Michael, also just to elaborate -- you asked a good question about what were our initial projections and timelines, and how does the board feel about that and what are we doing?

When we announced in early 2007 that we were now in an arrangement and alignment with Amgen and a collaboration and option agreement, we did give guidance at that time that we thought we would be in a position within 12 to 18 months of that time to fully informed their option. And now, we're indicating on this call that we believe that will occur not in the first half of '08, as you would have expected then, but rather in the second half of '08, as we're telling you now.

The board has, I think, very diligently been looking at what is going on with the enrollment of this trial with management and with consultants. And as Andy just pointed out, we have evaluated the clinical trial design, and we're comfortable that this is still the most practical way of getting to the answers that this trial is designed to achieve -- not to say that we also wouldn't like it to enroll faster. But as we have put in place many new mechanisms in the second half of '07, we do have confidence that throughout '08, this trial will be enrolling as fast as we saw now for the second cohort. So I do think that the information will be forthcoming in the timeframe we predicted. When we first dosed the first patients in April of 2007, that was one patient in one center. And as you know, with additional centers come additional IRB review, additional contracts, and a number of other things that didn't have this study recruiting throughout 2007 at the same pace it's recruiting now in 2008.

Okay. And can you give me some color as to what the -- how you anticipate letting us know the interim data you expect in the first half of '08, and what setting -- and what type of data we should be looking for with that? Should we be expecting -- how -- obviously, we won't know what the data, are but how will be data be relayed to us, in terms of -- will this be percent [ejection] fraction improvements? Can you give us some idea of what type of data we should see in that release, whenever that is in the first half?

Good question. I'll start with how and when it might be released, and turn over to Andy for what would then be potentially released. As we've indicated in this trial design, we are dose-escalating to target plasma concentrations in the early cohorts, and we expect that we may see a pharmacodynamic effect as measured by echocardiogram in those early cohorts, with the latter cohorts designed to extend the duration of dosing, but not necessarily to increase the target plasma concentration.

So we anticipate with an upcoming interim analysis we may or may not have a pharmacodynamic effect at the peak targeted plasma concentration intended for study in this trial. And as such, we would deem the presence or absence of that to be a material event that would then require disclosure by press release in topline form. We would want to do what we could to not jeopardize the presentation of that data at a subsequent medical or scientific conference, so most likely that would be by press release to be followed by full data at an upcoming conference.

And the kinds of conferences that then might be venues for that disclosure could be the American College of Cardiology meeting in the second quarter; could be the British Heart Failure Society meeting, also in the second quarter; it could be the European Society of Cardiology or the Heart Failure Society of America meeting in the third quarter; or the American Heart Association meeting in the fourth quarter.

So those are the types of venues where we might expect to be in a position to present data, albeit only likely then to be followed -- to be preceded by press release.

So what you could expect to see -- I think what everybody is most interested in is to see whether or not we are observing increases in ventricular systolic function. And that is assessed echocardiographically. So you'll see data on ejection fraction, on fractional shortening, on a Doppler-derived index of cardiac output, which I won't spend any more time than that talking about right now. It's something that we could go into more detail later. But it also looks at the flow of blood through the aortic valve, which is related to the output from the heart.

We will be having data on the volumes of the ventricle at end diastole just before the heartbeat begins and at end systole, the end of the heartbeat. And we'll certainly be looking and presenting data on the plasma concentrations of 452 at which these effects are observed. And then finally, in the interest of fair balance, data on adverse events, electrocardiographic parameters, and any laboratory values of note.

If I could just make one quick follow-up, and then I'll go back in the queue. You mention ACC, but the deadline for submission for late breaking clinical trials is January 7. We're now January 31. So how could ACC be a possibility for presentation?

I think what -- in keeping with our precedent I can say is we do not comment on whether or not we have submitted abstracts, only whether they have been accepted for presentation. And as such, you are right about the deadlines.

Charles Duncan, JMP Securities.

Many of my questions were asked but I wanted to explore the Amgen option a little bit in terms of the data necessary to trigger that event and the timelines and then the kind of terms. If you could just remind us on some of the terms involved in the Amgen option --?

Sure thing. In terms of our obligations, we have agreed to provide clinical trials data from this Phase IIa clinical trials program. Now, the data that we're obligated to provide is a subset of the data that will emerge from the Phase I trial and Phase IIa trials that we have described. So some of those trials do not inform the option. Some do, and we have obligation to provide a subset of the data from this program.

Upon receipt of that, assuming that it is deemed satisfactory by Amgen and it fulfills the requirements, they then have a clock, the time-frame of which I can't go into detail -- but they have a clock that then determines the timing upon which they may elect to exercise their option.

Were they to choose to exercise their option, they then would be responsible to pay us an additional $50 million -- this in addition to the $75 million already paid, and they then would be responsible, albeit working collaboratively with us, for the then later stage development of CK-452 and we would have certain rights and economics associated with that, including the rights to earn up to $600 million in milestones weighted towards development as well as royalties and other types of economics and participatory rights that relate to our copromotion in North America.

So the next action, if you will, on the horizon is our generation of data to inform their option so that we might then be in a position to engage more collaboratively going forward. To this point, Amgen is a very good partner, albeit we are arguably in the front seat, and them sitting beside us in the passenger seat, as we pay for and as we operationalize and sponsor the development program that we have described.

Robert, I know you don't want to talk about the clock, but perhaps I can ask in a different way -- is it measured in weeks or months, or do you have to provide that data by midyear? Or if you provided it by the end of the third quarter, would that give Amgen enough time to get back to you yet this year?

I can't answer your question the way I think you would be most satisfied. What I can say is that it's relatively short, and it's not determined by a time point in the year. Rather, their option is a function of when we provide them data, when we provide them that data.

Okay. And should we assume that that data includes not only the functional data from Phase IIa, but perhaps some subset of the oral data, as it would make sense to me that they would be interested in not only the acute but also the more chronic indication?

You know, I can't for reasons of confidentiality go into what informs their option. But I do think it's fair to say that for us, developing both an IV and an oral -- Amgen has interest in both.

Okay, and then how would you decide which oral to take into Phase IIa? Can you give us some sense as to what differentiates the different formulations? Is it going to be a totally data-driven thing, or do you have a certain preference?

Well, right now, the study that's ongoing examines three different prototypes of a modified release formulation. And as we see the pharmacokinetic data generated in healthy volunteers by dosing with those modified release prototypes, we will get an idea as to whether or not they sufficiently delay the absorption of the drug so that we don't have such very high peaks and very low troughs as we did when we just administer drug powder in a capsule. We will get an idea then of how frequently we might need to administer the drug to maintain plasma levels in a certain range and to avoid them -- to avoid really high peaks and really high troughs. Again, that's what we're attempting to eliminate here.

And obviously, we would also look at other non clinical things like the ease of manufacturing and expense and so forth and so on if the prototypes were in other ways equal. I think clinical data will drive things primarily -- if they look pretty equivalent, then we'll look at non-clinical drivers such as cost and ease of manufacture.

Just to correct your question a little bit -- you indicated for entry into Phase IIa -- what we're doing with these various forms of modified release CK-452 is readying for the selection of one that could be available to us as we enter Phase IIb.

Meg Malloy, Goldman Sachs.

I just wanted to drill down a little bit more on the Amgen option. I take it you -- is it fair to assume that you guys expressly agreed on the functional results of the studies that would be necessary for Amgen to decide on their option? What I'm getting to is, maybe you deliver the number of patients that you agreed on. But if they have a different view of the results or they wanted more data from let's say the oral program, what are the options for Amgen if they wanted more data before they decided? That is -- let's say whatever data you give them later this year isn't sufficient in their view, what happens then?

It's a very good question. So, in the case of what we're obligated to provide, it's not data that meets a threshold of activity, meaning their option is triggered by the quality of the data or the results, but rather, we need to deliver data from trials, the design of which have been agreed, the data being what it is. And that then triggers their review clock.

Were we to deliver that and it be deemed suitable for our satisfaction of our option, then their clock begins ticking. And our option -- or rather their option is rendered null and void if you will after that clock expires, and as we may then enter into Phase IIb trials. So it's not as if this is something that can go on indefinitely.

As far as what may happen were there to be a dispute between whether what we think is suitable and what they think is suitable, I really can't go into that detail.

Just to follow up, so will you let us know when you have submitted the data to Amgen?

I think we will likely need to as much as that will deliver on the material objective of the Company.

Greg Wade, Pacific Growth.

First, just a quick question with respect to the financial guidance. Can you just tell us what your anticipated year-end cash is going to be?

We don't do that. We do a GAAP guidance basis, and we give you kind of all of the information for you to be able to look at that. But basically, what we've done is we just -- in Robert's comments, he told you we ended the year (technical difficulty) 44 million -- $144 million in cash, almost $145 million. And on the guidance that we gave you, you can look at the cash -- net cash number, and that's almost 24 months worth of going forward cash on a gross burn basis. That's the way we look at it.

And then just to back into the end of the year number. With respect to your anticipated revenues of $12 million, can you tell me -- can you break that out what's cash receipts and what's revenue recognition, please?

It's all revenue recognition. It is the amortization of the Amgen upfront.

Okay. And then just switching gears -- with respect to the second cohort, can you just give us an update on how many of the eight patients have been enrolled please?

You know, Greg, it's a very good question. But I don't think we want to get into defining patient-by-patient data. I do think that we can confidently say that cohort two will complete its treatment phase during this first quarter.

And again, I'm distinguishing between enrollment and treatment. Enrollment refers to first patient visit. Treatment refers to last patient visit, given that each of these patients undergoes several treatments over the course of at least four visits, as Andy described.

At least four visits. And I guess another point I would add just to understand how the trial goes, the patients do have to come back for four treatment visits. That doesn't mean four visits -- there are actually more, because they have to be screened before they start treatment, and then there's a follow-up. So there's really six visits.

And while we do specify that there is a minimum interval of time between study drug administration of a week, in order to try to maximize the flexibility for these patients and their lives and for our investigators, there's no maximum time that can occur between visits.

So you can't enroll the last patient and assume that four weeks later, they will be done with the trial, because they may not, depending upon how their lives are going.

So we do still feel that we can confidently say that we'll be done with treating in the first quarter. But you can understand that even enrolling a patient doesn't give us a definite clock as to when that patient will finish the trial.

Then with respect to the next Phase IIa study that's expected to get underway, what is the trigger for you considering it is underway?

The trigger for considering it is underway is the initiation of dosing of the first patient under that trial protocol.

You know, we are sort of a month in here into the year. Obviously, roughly eight weeks left in this quarter and 13 in the next. Your guidance of first half of a 2008 start is a little bit vague for something that's, in theory, imminent. Can you just tell me the parameters around which there is variability which has led to this broad expectation?

I will start it, and maybe I will turn it to Sharon as well, because it was our anticipation that we were going to be initiating dosing of a patient in one of these Phase IIa trials by the end of 2007. That did not happen. Some companies when they talk about beginning a trial, they talk about it being open to enrollment, that being the trigger for the study being underway.

We take a more conservative posture and say until the patient is dosed, that trial is not yet initiated. And in this way, because of the time lag that can occur between IRB approval and first dosing, we tend to be uncomfortable restricting this to the precision of a quarter, but rather a six-month period. We think that's more practical given the way these things ultimately play out.

If it was supposed to finish or get underway by the end of last year, and you still don't know whether it's going to start by June 30, I would say that (multiple speakers)

No, I didn't say it's wouldn't start until June 30. I said it would start between now and June 30 (multiple speakers) another --

Right, but it was supposed to (multiple speakers) end of last year. So my point would be that there seems to be something going on with respect to this study in terms of an inability to kind of get it going and have a patient. And I was wondering what seems to be the problem.

It's a good question, but I wouldn't make that assumption. I think that what we're doing is the same sort of basic blocking and tackling that sometimes causes delays. And when you introduce lawyers and when you introduce other complexities associated with initiating a trial in a new center, that is not uncommon.

Are there any centers that have IRB approval and could enroll patients for this study?

I don't want to get into it by center by center like that, Greg.

Just any -- not just one. Just any? You were expecting to have that goal achieved by the end of last year. Is there any yet in the first four weeks of this year where that has been achieved?

Greg, you're asking excellent questions, but I don't think that from the standpoint of our communications practices and precedent I can get into that level of detail.

Couple more quick questions on 452. With respect with respect to the drug-drug interaction studies, are there anything from preclinical ADME valuations of the compound that would suggest a drug-drug interaction? And which drug-drug interactions would those be?

Actually, our preclinical data suggested that we probably wouldn't have much in the way of drug-drug interaction, which is why we wanted to get to the study in clinic upfront to demonstrate, that so that as we went into later Phase II and Phase III, studies we could actually limit the list of prohibitive concomitant medications that would need to be precluded from administration during the trial. And you may also recall -- not only preclinically, but in our first oral bioavailability study of the compound, we had effectively 100% bioavailability, which means that there is an essentially no first pass metabolism by the liver. And the liver is where most drug-drug interactions actually occur -- not all of them, but the great majority of them occur, because different drugs compete for the enzymes that have metabolism in the liver.

So given the fact that we have essentially 100% bioavailability, and therefore, very little in the way of first pass hepatic metabolism, we did this trial in an effort to really take drug-drug interactions stuff off the table as we move forward.

And then my last set of questions go to the Amgen option. Obviously, it's a very important component of the deal, that Amgen step-up, but there's little that's been described with respect to the product profile or data from the Phase II studies that you're doing that would allow investors to make some assessment as to whether you have hit the point that Amgen requires in order for us to take up their option.

So I have two questions. One is approximately how many patients will be needed to be treated and have data available to inform their option such that we can make a reasonable assessment of when that might occur based on your performance in terms of getting the studies up and underway? And secondly, I think it would be fair to investors to describe the key things that we should look to those studies in order to make an assessment as to whether Amgen is likely or unlikely to take up those options with respect to all of the characteristics that you're seeking to provide data to. And that's it, thanks.

Greg, you're asking me to speculate on what Amgen might want to see in the data, something that I cannot do. What I can tell you is that the trials that we are required to conduct and deliver data from are ones that measure the various effects -- pharmacokinetically and pharmacodynamically, not in the way of clinical benefit, but rather by those measures, in patient numbers that -- in each case, these are trials in tens of patients, not hundreds. And as such, it's a classic Phase IIa program, of which there are ongoing Phase I and Phase IIa studies.

How Amgen may interpret the data is their business. And as to what might be their hurtles and thresholds of activity, I really can't say. This is a new mechanism of action, and I suspect, like Cytokinetics, they would like to be able to see the totality of data before they determine whether or not this might be attractive within their portfolio.

Okay, well, I wasn't really looking for what their threshold might be. Certainly, neither you or I can predict what Amgen's mind is. It's with respect to the patient populations that you will be looking to see efficacy in. There's obviously ischemic and nonischemic heart failure patients -- you know, oral bioavailability and pharmacokinetics and pharmacodynamic relationships. I mean (multiple speakers) ask the question.

Greg, you're spot on. The kinds of things that you can imagine Amgen is interested in, just like Cytokinetics, is how does this drug behave pharmacokinetically and pharmacodynamically, given the number of the comorbidities and complicating conditions in the treatment of heart failure where you've got patients with ischemic disease, where you've got patients with renal dysfunction, where you've got patients that are acutely ill or not. And those are the kinds of things that we are evaluating in the context of this program.

That's helpful, because I think that points to the things that Amgen wants to evaluate in order to maybe take up the option. And that's the answer I was looking for.

[Heather Hussey], Needham.

It's actually Alan Carr. I joined the call a little late. Sorry if I some of these questions have been answered, but I was wondering if you could tell me a bit more about where you are in dosing in the 452 trial, the Phase II trial, and what sort of sense you're getting on the therapeutic index at this point?

So I'm going to turn that question over to Andy, since I already answered it twice. No offense, but I'll let Andy answer at this time.

All right, well we said during the call and also in answer to questions that we expect to complete treatment in the second cohort by the end of the first quarter.

Are you revealing doses yet at this point or no -- that you're going to be exploring?

We have not given guidance on the specific doses. But what we have said is that you can look at the Phase I study and see the range of concentrations that we have explored there, and the kinds of increases in ventricular function we've seen at various concentrations, and imagine that we're going to want to stay well away from concentrations that were associated with toxicity in that study, and be well in the middle of the range that was associated with increases in ventricular function in those healthy volunteers.

I take it you haven't seen any signs of any adverse events related to that yet.

We haven't seen anything that we wouldn't have expected based on what we observed in the [11 11] -- first time in human study. It's all been very consistent with what we saw there.

In fact, that is the beauty of this mechanism, Alan, as you know, because the Phase I results in healthy volunteers track so closely to what we would expect based on what we had seen in vitro and in vivo, that we're hopeful that that then will be true as we have data from the Phase IIa trial and in heart failure patients.

Jason Kantor, RBC.

A couple of questions first. James, what's driving the timing of your decision? It sounds like things are -- you will be changing your roll right around the time that perhaps things might get very exciting in terms of clinical data and next steps.

Well, Jason, first of all, I'm maintaining a role as Chairman of the Board, obviously, as you know. And this timing was actually determined actually quite a while ago. It has nothing to do with what's going on at the Company. This is a personal decision that I made with the Board to go back in and get involved with new companies getting started again.

And Cytokinetics continues to do well. I think it's going to be a very good year for the Company. I'm excited as its Chairman of the Board of Directors and Chairman of the Scientific Advisory Board here to obviously maintain that relationship. So it's really is totally independent of the timing of the corporate calendar of the Company.

Okay, great. And then obviously, I've got to ask my questions about this trial. But where are the new sites that you added, and why wouldn't you expect the pace of enrollment actually to accelerate relative to the second cohort, just given that there's a natural ramp to those as well?

Well, I said that we did as a matter of fact. I said the second cohort enrolled faster than the first, and we would expect to see this rate of enrollment to continue, if not increase somewhat.

And are these all the new sites -- are they all U.S., or -- where are these sites?

We haven't commented on where sites are other than to say they're in the UK and also outside the UK.

Okay, but have you gone to -- outside the UK is sort of everywhere. Are you going to places such as India or South America, or are these all Western countries?

You know, this is a program that in its entirety is going to be very international. I think it's one of the things that Cytokinetics is doing unusually well for a company that is at our stage of development. We're conducting clinical trials on many continents, this one not being an exception.

So you won't be at all specific about the countries that you are enrolling patients in?

At this time, no.

And then, the initial doses that you are testing -- know you haven't been specific, but are these doses ones where you might actually anticipate seeing efficacy, or do you have to start quite low?

No, that's the reason for doing the first time in human study in healthy volunteers, where we could and did enroll it more quickly. You can always enroll healthy volunteers typically a lot more quickly, so that we could discharge the obligation to study really, really small doses that we would not expect to be pharmacodynamically active in those volunteers.

And so in the heart failure trial, we are exploring concentrations that we might expect to be associated with the threshold of a pharmacodynamic effect, more toward concentrations where we saw clear pharmacodynamic effects in healthy volunteers, all the while staying well away from the concentrations that were associated with unwanted effects in the healthy volunteers.

Okay. And then with regard to the other Phase II case studies that you're looking to initiate here at some point before the end of the second quarter, how are you going to do things perhaps differently, or what have you learned from this first trial such that you could get a more rapid pace of enrollment in those studies?

I think comparing enrollment in one study to a second study and a third study is not useful. The entry criteria are very different. The evaluations are different. They are completely different studies.

I have enrolled trials in ischemic heart disease in my past life that have gone much more quickly, but they were easier for the patients and easier for the investigators. So (multiple speakers)

So, is that a criteria for the design of these future -- I'm just trying to get at whether or not -- you went with a particular trial design, and it had certain liabilities to it. Are you going to (multiple speakers)

And certain advantages (multiple speakers) as well

Yes, so the question is, are you going to do the same thing with these other studies or would you --?

Well, no, we wouldn't do the same study twice. As you will hear, when we announce them and give you details about the study design, each of the two to come are substantially different in the clinical setting, in the type of patients, and in the evaluations. And I think making predictions about the rate at which trials will enroll until you actually get the trial in the clinic is dangerous. And I don't think I should do it.

But obviously, we have done and will do everything we can to try to make sure that thing that things enroll quickly.

You know, Jason, getting back to one of your earlier questions, one of the things that will benefit any of the studies that we initiate is the fact that we have done a lot of the legwork now earlier on in terms of investment in the regulatory filings and conversations to allow us to initiate trials in multiple regulatory jurisdictions.

So you weren't particularly comfortable with my answer, and maybe I can elaborate a little bit more on where. We're going to be doing studies in 2008 in the UK, in Russia, in the U.S., in Canada and a number of other venues where that will benefit all of our trials.

Christopher James.

With respect to CK-452, I guess just given the novelty of the mechanism, what are your -- what are the heart failure experts expecting with respect to -- where is the bar set? Are the looking for a better [inotrope] -- specifically with efficacy and safety, what are the expecting with respect to ejection fraction, fractional shortening, and safety?

And then two, could you remind us what are the safety parameters? You mentioned some of the efficacy parameters we should expect to see. But what are some of the safety parameters, specifically renal parameters?

Okay, sure. First of all, we have had extensive discussions with our consultants, with our collaborators at Amgen and internally about what we would expect to see or what would be encouraging. And there is a real consensus that it really only takes a few percentage points of an increase in ejection fraction to be associated with clinical benefit. And I can elaborate on the evidence behind that sort of statement.

So if we were seeing increases in the range of 3 percentage points, 5 percentage points, maybe a little bit higher than that, a lot of individuals believe that that would likely be associated with decreases in hospitalization frequency, and improvements in mortality. And the reason why people view such potentially modest increases as also potentially therapeutically quite beneficial has to do with what we've seen in association with other treatments.

It goes back quite a while now, but you may recall the very first thrombolytic therapies were associated with decreases in the development of heart failure, which was actually the initial indication for the first thrombolytic streptokinase -- didn't start with a mortality indication. And that decrease in the onset of congestive heart failure was associated with in various trials about 3 percentage points to 5 percentage points improvement in ejection fraction compared to placebo.

When you look at the early beta blocker trials in heart failure as well, the reduction in morbidity and mortality is associated with, again, about 3 percentage points to 5 percentage points improvement in ejection fraction.

With cardiac resynchronization, the improvement to morbidity and mortality are associated with slightly higher increases in ejection fraction -- maybe more on the order of five to seven percentage points, but they are still pretty modest.

So we think that if we can get in that area at concentrations that are very well-tolerated and are not generating unwanted side effects we should do very well. So in distinction then to the beta-adrenergic agonists and the phosphodiesterase inhibitors, which can achieve those kinds of increases in ventricular systolic function, those increases occurred at the same concentration that typically are associated with an increase in the incidence of ventricular tachyarrhythmias, and often will precipitate myocardial ischemia.

In our case, we have absolutely no pharmacological rationale for precipitating arrhythmias of any sort, nor have we really seen such things, either preclinically or clinically. And in terms of concentrations that have in a healthy volunteer caused the syndrome of myocardial ischemia, they were many times in excess of what we believe we will need to treat patients with heart failure to generate the kinds of increases in ventricular systolic function that I've just described.

So in terms of safety, then, we will look at all reported adverse events, as we always do. We will run a full panel of laboratory parameters as we always would. With respect to renal function, we will certainly be looking at creatinine and BUN, as we always would. In particular, we're looking at cardiac biomarkers such as creatinine kinase, [the MB fraction] of creatinine kinase,[entriponins], we'll be looking at all of those. These are heart failure patients. You can expect to eventually see data on BNP, which is a marker of heart failure severity.

So I think when we finally have the data available to discuss, it will be a pretty robust and complete panel of data.

George Zavoico, Cantor Fitzgerald.

I'm glad that you were a little bit more forthcoming with -- as far as Jason's question about what other than UK means. I was wondering if you could be also a little bit more forthcoming in identifying or telling us how many sites are now -- have at least have submitted IRB proposals for the Phase II? You've enlarged the number from the one in UK to how many now? Can you tell us that now or not?

George, I'm thinking that's not practical. As much as I understand why you might want to know that. I don't want to get into a situation where we're being measured on site-by-site additions, and where we're expected then for setting precedent to announce every time we've got a new site or a new patients enrolled. I don't think that's practical, and nor is that reasonable given these types of situations.

I was just trying to estimate from that the reasonable estimate on your ending of that trial.

Well, I know where you are going. I think the way that you should look at this -- and hopefully, this gives you sufficient comfort -- is that we are identifying that the first cohort in that study in stable heart failure patients getting the IV form of the drug -- we admit did not enroll as rapidly as we would like. We did put in place measures with additional sites in and outside of the UK so that the second cohort has enrolled far more rapidly. And the treatment phase concluding in this first quarter gives you indication of how much more rapidly that is. Maybe this is James Sabry.

I will provide a little color. I think this is something we haven't said before, but that's useful to think about. When you start a trial and you tell the investigators that you're going to need to enroll 40 patients in cohorts of each, if I were to say that I was going to have -- let's say a large number, meaning double-digit numbers of investigators, what would happen I can assure you is that the investigators will say, well, I'm not even going to bother, because that's too many investigators, and I won't have a chance to enroll any patients, and I don't want that.

So you are kind of obligated in terms of maintaining good relationships with your initial investigators to start out with the number of centers that they tell you they think they need to enroll the trial. And it is only after they demonstrate -- to their unhappiness, but that they demonstrate that they can't enroll the trial at the rate that they thought they could that you can then begin to add other centers, and begin to have real rationale for how many centers you need, because you've now got experience with how quickly the trial is enrolling.

That is a dimension -- we talk about paperwork and so forth, and that's all true. But there's also an investigator relationship aspect to this that is extremely important.

Fair enough. Do you anticipate -- the trial seemed to have slowed down a little bit in the summer. Do you anticipate the same sort of seasonal variation going into '08?

I would say that typically, summertime tends often to be a time that enrollment may slow little bit. But we I think have enough centers in the right kind of places where we're not going to see that this year.

Fair enough. I'm interested in the IV to oral transition trial with ischemic cardiomyopathy. You've just initiated the trial with three different formulations for the oral. Are you going to wait on that trial until you determine which of those three formulations is the best, or which one --?

No. That will not -- they are not related. One does not [gate] the other.

And for the cancer trials, the multiple cancer trials that you have got ongoing, for the previous trials, you had a hurdle to cross, depending on the overall response rate, whether you would proceed to Phase II. Do you have that again for the breast cancer and the other trials you've got ongoing in 295 and 921?

If I'm understanding your question correctly, are you ask me that we need to see some evidence of response to the drug in the Phase I dose escalation portion of the trial to proceed into Phase II? Because the answer to that would be no.

(multiple speakers) [Then] there are stages -- Maybe I'm being a bit overly precise, but I think we need to be, given the difference between -- there are phases to the trial, so Phase I escalates the dose to define the maximum tolerated dose on a new, every-other-week schedule. That's Phase I.

Phase II now enrolls women with locally advanced or metastatic breast cancer who haven't been treated with chemotherapy before, or only remotely, at that maximum tolerated dose. And it does have a staged design, as most such Phase II studies do. So you enroll a number of patients, and you look for a certain ratio of responses, and if you see them, you can go on into this next stage, and so forth.

So you'll go into Phase II independent of what the response rate at the DLT and MTD are, then?

I think it makes really no sense to use the term "response rate" with respect to a Phase I, because we're going to wind up only treating three or six patients at the dose that we think should be effective as we go forward into Phase II. And we may or may not see responses in such a small number of patients. And we won't make decisions based on that.

(multiple speakers) that would be [spot] underpowered.

The real value of response rate, George, is really when you look at it in Phase II studies at one dose over as uniform a population of patients as you possibly can.

And in that case, you have predetermined criteria as you did before.

That's right. And George, I'm pleased that you asked the question about something other than CK-452. Obviously, we are focused to CK-452 in 2008. But clearly, we see significant value upside in our KSP inhibitors, and also in GSK-295. And 2008 will bring significant news flow across the whole portfolio of drug candidates.

Michael Aberman, Credit Suisse.

Not that this call has gone on long enough but, have you guys -- this is for Andrew. Would you guys consider raising the dose in future cohorts?

I'm sorry; say that again?

Have you considered increasing doses, going more cohorts or increasing (multiple speakers)?

Well, we'll be driven by a drug development perspective. So if we get to the highest planned target plasma concentration and dose, and we don't see a pharmacodynamic effect, then -- and this is all hypothetical, but if we didn't -- and also, that dose and concentration were being well-tolerated, then obviously, the rational thing to do would be to amend the protocol to allow yourself to study higher doses. I'm (multiple speakers) talking in general, but as a principal of drug development.

Another way to answer your question is, no, we have not considered raising the dose for the fact that we continue to be in a dose-escalation phase, and where the data as it were to be coming available to us right now would not suggest that that may be necessary.

That's right. As I know we've said several times before, the entire planned range of doses in this trial is studied in the first two cohorts. And we haven't finished treatment in the second cohort. So we don't really have available to us sufficient data to even know whether or not that would be something that would be necessary.

So, again, I would really caveat that my comments were general and hypothetical and related to just any drug development program.

At this time, there are no further questions.

Thank you, operator. We would like very much to thank the participants today for this call and continued interest in Cytokinetics. 2008 has the potential to be a quite important year for Cytokinetics, and we're grateful for your continued involvement and interest in what we're doing. Operator, with that, we can conclude the call. Have a good day, everyone.

At this time, you may disconnect the line. Today's conference call has ended.