Intercept Pharmaceuticals Inc (ICPT) 2014 Q1 法說會逐字稿

Thank you for joining the Intercept Pharmaceuticals first-quarter 2014 financial results and business update conference call.

(Operator Instructions)

Please be advised that this call is being taped at the Company's request, and a webcast of this call will be archived on the Company's website for two weeks from today's date.

At this time, I would like to introduce Mr. Senthil Sundaram, Intercept's Senior Director of Corporate Development. Please go ahead.

Good morning -- or actually I should say good afternoon, and thanks for joining us on today's call.

We are reporting our financial results for the quarter ended March 30, 2014. We will also be providing an update on our development programs. Before I begin, please remember we will be making certain forward-looking statements on today's call, including statements and forecasts regarding our future financial and operating performance, our POISE and FLINT trials, anticipated timelines for the potential approval and commercial launch of obeticholic acid; and our regulatory, clinical and commercial plans, goals, and estimates, as well as other statements which relate to future events.

These statements are based on the beliefs and expectations of Management as of today. Our actual results may differ materially from our expectations. Investors should read carefully the risks and uncertainties described in our reports filed with the SEC, including the Risk Factor section of our most recent annual report on Form 10-K, and in Intercept's other filings with the SEC. We assume no obligation to revise or update forward-looking statements whether as result of new information, future events, or otherwise.

The format for today's call includes opening remarks from Intercept's management team and then we will open up the call to take your questions. At this time, it's my pleasure to turn the call over to our CEO, Dr. Mark Pruzanski.

Thank you Senthil, and thanks everyone for joining us on our conference call and webcast.

I'm going to provide you with an update you on development of lead product candidate, obeticholic acid, or OCA. Barbara Duncan, our CFO, will then discuss our financial results and cash runway.

Let me start off by saying that we are very excited about the progress and direction of Intercept. Our core objectives anticipated over the next 12 months are as follows: one, complete the work required to submit global regulatory marketing applications for OCA in our lead indication, Primary Biliary Cirrhosis, or PBC. Two, process our upcoming Phase IIb NASH data from the FLINT trial and advance OCA into an international Phase II development program in NASH. And three, build on OCA's initial promise in these indications by advancing the product in additional cholestatic liver diseases, such as primary sclerosing cholangitis, or PSC, where we believe we have a relatively high probability of success.

We're in the process of building out all areas of the Company to achieve these goals, while also continuing to build the commercial infrastructure needed to support OCA's successful launch in the US and Europe. I also wanted to highlight the most recent addition to the senior management team, Rachel McMinn, as our new Chief Strategy Officer. I'm sure many of you on the call today know her from her prior position as a leading biotechnology analyst. We are very happy to have her on board. I know that she will be an important asset to the team as we build Intercept for continued future success.

Let me talk about the Phase III POISE trial. We had the opportunity to present the detailed results of POISE Phase III trial on PBC at the annual meeting of EASL, the European Association for the Study of the Liver, in April, last month. We had three main objectives for POISE: number one, to reproduce the robust efficacy we observed in Phase II; number two, confirm that efficacy could be maximized and maintained over 12 months, as we've observed previously on Phase II long-term extension studies; and number three, optimize OCA's tolerability profile. We were extremely pleased that the POISE results achieved all three objectives.

POISE met the primary efficacy endpoint with response rates that exceeded those in our shorter duration in Phase II trials. OCA conferred a rapid therapeutic benefit in PBC patients receiving either at 5 milligrams or 10 milligrams once-daily doses. A majority of the benefit was observed at the 3-month mark, and thereafter sustained for the duration of the 12-month trial.

We were also very pleased to see that our decision to study the lower 5-milligram OCA starting dose and titration scheme employed resulted in substantially improved tolerability with respect to pruritus incidence and severity, as compared to the 10-milligram dose group, without any meaningful sacrifice in efficacy. As a reminder, pruritus is a common symptom in PBC and other cholestatic liver diseases, and it can be induced in susceptible patients upon initiation of the standard front-line PBC treatment, urso, as well as by OCA. The mechanism of this drug-induced pruritus is thought to be related to the therapeutic benefit associated with the stimulation of bile flow, or what's called choleresis.

Pruritus is the only notable side effect in our previous two Phase II trials in PBC, which showed OCA to be associated with a dose-dependent increase in the frequency and severity of pruritus. The POISE results demonstrated that pruritus can be very well managed when patient started at a 5-milligram OCA dose and are then titrated up to 10 milligrams. Importantly, these patients essentially caught up to the non-titrated 10-milligram dose group in efficacy by the end of the trial.

More compelling still is that patient-reported pruritus scores, using a standard visual analog scale instrument, tended to normalize after about six months, with pruritus scores in both OCA treatment groups no different than those in the placebo group in the latter part of the trial. These new data suggest an adaptive response over several months with respect to OCA-related pruritus.

Physicians often employ dose titration when initiating urso-therapy in newly diagnosed PBC patients. We believe that OCA dose titration will be relatively straightforward from a commercial standpoint. Another highly encouraging detail that we've previously reported is that virtually all of the PBC patients who completed the 12-month double-blind phase of POISE opted to continue in the five-year long-term extension phase, which tells us those who had been taking OCA were generally tolerating therapy well.

Overall, following regulatory approvals of OCA in PBC, we believe these Phase III data will position our drug to be the first new effective medicine in close to 20 years to be made available to PBC patients with an inadequate response to, or who are unable to tolerate, first-line urso treatment. We estimate that this population represents up to half of all PBC patients.

Let me tell you about our plans for regulatory filings for PBC. We believe that our POISE results, together with our previously completed Phase II trials, support our proceeding to file for marketing approvals of OCA as second-line therapy in PBC. We are excited to continue working closely with FDA and EMA, and are preparing for pre-NDA and pre-MAA meetings with both agencies respectively, anticipated in the second half of this year. After our recent internal sensitivity analysis of time to completion for certain routine supporting Phase I studies, we now anticipate completing the NDA and MAA filings in the first half of 2015, which takes us past the year-end 2014 guidance we'd previously issued.

As you may recall, our POISE Phase III results were available ahead of schedule, and together with the final results from the global PBC study group that support our end point, these are not gating for our regulatory filings. We had previously anticipated various supported Phase I studies to be gating items, and most have of them have been completed or are on track to be completed this year. However, we recently determined that two additional Phase I studies should be conducted in support of in the NDA and MAA filings to ensure they are complete and to maximize our chances of a first-cycle review approval.

That said, the studies themselves are routine and should be straightforward to execute. Specifically, we plan to proceed with a Phase I bio-equivalence study to bridge our commercial and clinical trial materials. Given the unique pharmacokinetic properties of OCA as a metabolically stable biologic derivative that's extensively recirculated enterohepatically in the bile pool, we are seeking regulatory input on the study design prior to initiating it.

Another Phase I study we will conduct is a radiolabeled matched balanced study. We are ready to initiate the study pending finalization of the study protocol with regulators. We expect to initiate both of these Phase I studies in the second half of this year, and they are both gating for the completion of our NDA and MAA filings, since we currently project them to complete in the first quarter of 2015.

A few words on our PBC confirmatory outcomes Phase III trial. We believe we are well on the way to finalizing a protocol with FDA for the confirmatory Phase III clinical outcomes trial in PBC in the third quarter of this year. Our interactions with FDA have been very positive on the design of the trial, and recent KOL feedback from our meetings with EASL did not reveal any new design considerations. We believe we have all necessary study design aspects in hand to work with FDA to finalize the confirmatory protocol.

In the meantime, we are moving full speed ahead on all other aspects of trial preparation and are in the process now of identifying clinical trial sites around the world to be in position to initiate the trial by around the end of 2014. We project enrollment in the trial to be well underway at the time of OCA's anticipated accelerated approval, with completion of the trial to occur thereafter in support of eventual full approval in accordance with [sub-partage] guidelines.

Let me change gears now and talk about our FLINT trial and NASH program. Based on our most recent interactions with the NIDDK, we continue to expect to receive the unblinded results from the FLINT trial in July. Of course, the exact timing will be dependant on variables such as the timing of the last patient visit, the time needed to get the database locked, and then coordinating data exchange with NIDDK and the investigators. We recognize there is keen investor interest in seeing the FLINT trial results, and we will do our absolute best to communicate top-line material and new findings in a timely fashion in close coordination with NIDDK after having received the data.

After we are able to review the detailed FLINT results, we plan to formulate a detailed registration strategy and initiate formal interactions with FDA and EMA. While we realize many investors are eager to understand more about our plans for a potential Phase III design, including the specifics of regulatory endpoints and patient population, we cannot provide more detailed guidance until we have the FLINT trial result in hand and receive feedback from the regulatory authorities. Our current assumption, however, remains that a Phase III program would be designed to meet accelerated approval criteria based on interim efficacy results of at least one year in duration.

Now a few words on our other programs with OCA. We are on track to launch our first clinical trial of OCA in PSC, primary sclerosing cholangitis, by the end of this year. Like PBC, PSC is a cholestatic liver disease, although with distinct characteristics. PSC is an orphan indication with a prevalence of about one-third that of PBC and no approved therapies available, therefore representing a very significant unmet medical need.

Next, our collaborators at the Imperial College of London presented the final set of data from the OBADIAH trial of OCA in bile acid diarrhea at the DDW Conference earlier this week, which confirms our prior understanding that OCA represents a potential therapeutic option for patients with both primary and secondary bile acid diarrhea. Given our current OCA development priorities in PBC, NASH, and other chronic liver diseases, our development strategy and timing to pursue bile acid diarrhea are currently under review.

For portal hypertension, single center data for OCA were presented at the EASL meeting in April, suggesting that OCA can reduce portal pressure in cirrhotic patients without negatively impacting systemic blood pressure. In addition, pre-clinical data presented by two different groups at EASL suggest that potential OCA therapeutic benefit in the prevention of serious bacterial infections in cirrhotic patients, an exciting finding given that such patients are at significant risk of developing sepsis, often resulting in death.

Taken together, we believe that recent clinical and pre-clinical study results significantly strengthen our conviction that OCA has the potential to be the first of an important new class of broad-spectrum hepatoprotective drugs with therapeutic application across a range of chronic liver diseases in early- to late-stage patients.

With that, I will now turn over the call to Barbara Duncan, our Chief Financial Officer, for a discussion of our financial position.

Thank you, Mark. Good afternoon, everyone.

Please refer to our press release issued earlier today for our summary of our financial results for the three-month period ended March 30, 2014. We ended the first quarter with $134 million of cash, cash equivalents, investment securities available for sale on our balance sheet. This balance does not include $183 million of net proceeds we received from our follow-on offering in April. Our cumulative cash, cash equivalents, and investment securities, inclusive of these proceeds from the April public offering, are expected to fund our operations through 2016. This expected level of expenditures includes all the studies and work necessary for the PBC regulatory filings, as well as the initiation of the Phase II trial in PSC Mark just discussed, the lipid trial in NASH patients, and our Phase III NASH program, as well as certain pre-commercialization expenses.

While I won't review all of the quarterly results we shared in our press release earlier today, you will note that we had a fairly significant net operating loss totaling $257.7 million. However, please note that included in this net loss are non-cash charges totaling $245.7 million, comprised primarily of warrant revaluation expense of $226 million and stock compensation expense of $19 million.

The relation to the warrant revaluation -- recall that in connection with some of our pre-IPO equity financing, we issued warrants that are classified as liabilities, and are adjusted to fair value on a quarterly basis with the change in fair value being included in net loss. The amount included in net loss is a non-cash item, as Intercept is not required to expend any cash to settle the warrant liability. The warrant liability is primarily affected by changes in Intercept's stock price during each financial reporting period, which causes the warrant liability to fluctuate as the market price of Intercept's stock fluctuates; as well as the remaining term of the warrant and the underlying volatility utilized in the fair value calculation.

In general, the warrant liability for the first quarter increased significantly, primarily due to the increase in our stock price since the beginning of year. As of the end of the quarter, there was only one tranche of the warrants outstanding, representing approximately 865,000 shares, which were exercised on a cashless basis in early April and converted into 835,000 shares of our common stock. As such, we will record a final adjustment of approximately $56 million in non-cash other income in the second quarter of 2014.

In relation to the stock compensation charge, in the past we have issued options to certain of our consultants. Each quarter we are required to re-measure the stock option value to not only the newly vested amounts during a quarter, but also the vested options that remain outstanding that were issued to these consultants. Of the $19.1 million of stock compensation expense reported for the quarter, $16 million related to this revaluation for the consultants, primarily as a result of the significant increase in our common stock during the first quarter.

Let me now turn the call back over to Mark.

Thanks, Barbara. I think we can turn it over to questions now.

(Operator Instructions)

Our first question comes from the line of Jonathan Eckard from Citi. Your question, please.

Thank you very much for taking my question. I just had one on the FLINT trial and then one also on this lipid trial.

For FLINT, recognizing that the NIDDK doesn't want to jeopardize the central presentation at AASLD or publication of FLINT data, is there any idea or any color about what aspects of the data the NIDDK is most concerned about releasing that could put those in jeopardy?

With the lipid trial, I think this trial that's listed in the press release is only in NASH patients. But my understanding is I think there is also another trial that's been ongoing that has been listed on clinicaltrials.gov. Will any data from that trial be released over the course of the year that could shed any light on some of OCA's effects on lipids? Thank you very much.

Thanks very much, John. Good questions. I will take them in sequence.

We will be very closely coordinating with NIDDK and the investigators once we receive the unblinded FLINT trial results on a top-line statement that we will make. Obviously, anything new and material with respect to efficacy, safety tolerability, I think we would be looking to put out there without, of course, jeopardizing in any way the presentation anticipated at AASLD.

And NIDDK has confirmed that their intention is to, with the investigators, submit a late-breaker abstract for this year's AASLD, more, of course, for publication in a peer-reviewed journal. We will just have to wait until we get the results, and then coordinate closely with them, and come out then with a top-line statement.

With respect to the lipid studies, you are right. Just to clarify, there are two different lipid studies in two different patient population. One is currently ongoing, the one on clintrials.gov, and that is in PBC patients. The completion of that study and will -- sorry, the study results will be included in our NDA and MAA filings. So we will have those, and we anticipate that completing, therefore, around year end to get into the filings. After that, we will be able to -- I will say something about those results.

That said, I just want to make it clear again that the lipid profile in PBC patients is -- tends to be quite unique to them. As we recently demonstrated in the POISE results on lipid, there are slightly different OCA effects on lipids in PBC patients as compared to what we have seen in NASH patients. ¶ With respect to NASH trial, the NASH lipid trialing, don't know if you asked about that, but we do anticipate starting that in the second half of this year. Sorry, just wanted to be a little bit more conservative on the lipid PBC studies and suggest early 2015 instead of year end for the results of that study.

All right. Is there any reason why you are starting the NASH lipid trial in the fourth quarter and not sooner? Is it so you can get regulatory feedback, if necessary, on that? What about timing? Is there any reason why you're waiting until fourth quarter to start the trial?

It's just the blocking and tackling from a clin op standpoint. KOL feedback on the appropriate study design. We want to make sure that this is an absolutely comprehensive study.

I think I have said before that given that a good proportion of these patients are taking statins, or might consider a statin in the future, we want to be able to answer questions like, what happens in patients taking OCA alone? When you add OCA to a statin, or you add a statin to OCA, things like that.

We really want to make sure we get the study right. There is no other reason, other than the time it's going to take to set up the study for the Q4 start date.

Thank you very much. I will get back in queue.

Thank you. Our next question comes from the line of Jim Birchenough from BMO capital. Your question please. You might have your phone on mute.

Hi, guys. Can you hear me?

Yes, now we can, Jim.

Yes, sorry. First question on the Phase I study on bioequivalence. Could you maybe go through the technical challenges of demonstrating that with the recirculation in the hepatic system? How are you going to address that issue if FDA really wants you to show bioequivalence? I want to understand the issue a bit better.

Yes, and again we consider this reasonably routine. We are comparing our-- we are establishing a equivalence of our Phase III and commercial tablet formulated OCA, which is -- which we believe to be substantially equivalent. The PK challenge relates to the duration of dosing and the number of patients we're going to require.

We really wanted to give FDA the chance to input on the study design. We have a -- there is a precedent protocol for clinical bioequivalence in [percel] that we are relying on for the study design.

It is going to be parallel arm crossover design study, and fairly extensive with a robust number of subjects in it. I don't want to, pending regulatory feedback on design, I can't really provide additional details, Jim. But again, I want to stress that we think we've got a good precedent for it. We spent some time thinking about it and are going to be getting regulatory feedback very shortly.

And then, Mark, maybe just as we get ready for the detail from the FLINT study, maybe you can help us frame how we should think about the data you are going to generate versus what we have seen from the PIVENS study, as an example.

Will we get the detail of each of the components of the NAFLD activity score? Will we get things like the number of patients improving on fibrosis? Just trying to get a sense of detail.

What is appropriate expectation? Should we expect to see results better than Vitamin E and pioglitazone?

Yes. Thanks, Jim.

What I can say definitively is that the AASLD presentation, of course, the publication, eventual publication, will contain all of the information you just referenced. I cannot commit right now, pending receipt of the data in July and then coordination with NNIDK and the investigators to the specific details that will be top lined soon thereafter, ahead of the AASLD and publication.

I wish I could be a little bit more helpful, but obviously anything material with respect to performance on the NAFLD activity score, reduction on the primary endpoint, performance on fibrosis -- an indication of any effect on reversal of fibrosis, and then safety tolerability. Those are the key aspects at a high level that will certainly be material and need to be put out there. I can't comment further with respect to the detail.

In terms of the efficacy, what I have said before is that conservatively if what we see here is not dissimilar to Vitamin E, and we already know at the very least that have non-progression of fibrosis, I think that is a very good clinical outcome with a drug that hopefully we'll demonstrate over the longer term very nice safety, and is well tolerated in these patients.

Vitamin E is -- the results of Vitamin E and pioglitazone in the PIVENS were, I suppose, encouraging, but not adequate. Both drugs have their liabilities, and a lot of physicians who see these patients are not currently using them. There is certainly a need for novel effective new therapy. It is difficult for me to comment in more detail than that until we see the results.

Maybe just one last question, Mark, on PSC, could you maybe go through the endpoints you'll look at, and how quickly we could see data from that study?

Yes, sure. As a primary endpoint, what we will be looking for is changing up on phosphatase, very similar to PBC. There is literature now suggesting that alphos, similar to PBC, is a risk marker for long-term outcomes. To be more specific, it has been shown that patients who get down below 1.5 times upper limit normal have improved longer-term outcomes. We will definitely be looking at alphos.

Then given that -- and a number of secondary liver function parameters. Then given that approximately 75% of these patients have overlapping ulcerative colitis, we will also be looking at UC symptomatology as well. Then we have reason to believe, based on pre-clinical data, that OCA as an FXR agonist, could have an affect, protective affect, in the intestine, as well as in the liver.

As far as when we can expect to get results, it is too early to project that right now. All I can say, really, is that we anticipate beginning the study prior to, or by around year end.

All right. Thanks, Mark.

Thanks, Jim.

Thank you. Our next question comes from the line of Alan Carr from Needham & Company. Your question, please.

Hi. Thanks for taking my questions. Wondered if you could comment on a couple of things.

One of them is where things stands from commercial perspective, commercial preparation here for PBC, both, I guess, qualitatively and then also how that might impact burn this year? Also, granted there's still a lot of unknowns at this point, but I was just wondering if anything had changed in terms of your current thinking about design for the Phase III NASH trials?

You were thinking of a couple of them, 500 patients each. One with more severe fibrosis, one with less severe. Can you just comment on that to where your current thinking is on it? Thank you.

Yes. Thank you, Alan.

With respect to commercial preparations, as I mentioned in my remarks, we are aggressively moving forward to prepare for anticipated launch in the US and Europe for PBC initially. Again, Regan, who is not here right now, our Chief Commercial Officer, has been leading that effort for over a year now, and things are going apace. I am quite happy with the progress we are making there, and we very much anticipate being in a good position for a successful launch in both regions.

You also asked about impact on burn rate. As Barbara mentioned, we are in a very good cash position right now. Based on current projections, cash run rate through 2016, and that hasn't changed. That is sufficient. The proceeds that we recently raised certainly give us sufficient capital to run, to do what we need to do from a commercial standpoint, preparedness standpoint.

With respect to the Phase III NASH design, you are right that in previous comments, we talked about as a placeholder, at least, the idea of large international outcomes studies in these patients, looking primarily to the more advanced patients with, for example, later-stage fibrosis and then cirrhosis where the greatest unmet need occurs.

You also mentioned the number of patients. Again, please realize that these are placeholders. We have not yet had formal interactions with FDA or EMA, and we need to do so, as well as getting the FLINT trial results to be able to have a more -- more clarity on the design of these trials. These will need to be large and powered to get to outcomes and confirmation of clinical benefit past the interim look that we hope will result in accelerated approvals.

I don't think I could say anything more than that. It would be more speculation than anything else. Again, we just need -- unfortunately, I know everyone is eager to get these details, but as I said in my remarks, we just need to get the results in July from FLINT and go from there to meet with the regulators and have informed discussions with them, and continue to have discussion with KOL, as we have been doing all along.

That is helpful. Thanks very much.

Thanks, Alan.

Thank you. Next question comes from Akiva Felt from Oppenheimer. Your question, please.

Hi, Mark. Two questions. First, in PBC, can you walk us to the origin of these two additional Phase I studies? What led to decision to start those now? Second question, in portal hypertension, are there any plans for future clinical studies at the moment?

Yes, let me take the second one first. It's a short answer.

Portal hypertension, what I have been saying is that I have been sort of interchangeably using -- referring to portal hypertension and cirrhosis because patients with cirrhosis who have portal hypertension, and portal hypertension is an important pathologic feature in their disease that predisposes these patients to adverse outcomes. That was the basis for our proof-of -- previous proof-of-concept study that recently read-out where we were looking for improvement in hepatic venous pressure gradient, HVPG.

And I could very much see, and the FDA has commented, or in the FDA workshop rather last September, looking at NASH endpoints, HVPG was one of the featured surrogate endpoints that looked potentially promising in patients with cirrhosis. I sort of view that part in parcel in context of our future plans in NASH, plus, minus cirrhotic patients with diseases resulting from other ideologies, all-comer cirrhosis-type trial, if you will. With respect to -- I hope that answers the portal hypertension plans.

With respect to the origin of the Phase I, there are two of them, of course. There's bioequivalence and the mass balance study. Our prior view was that we wouldn't necessarily need to do a formal clinical bioequivalence study. And only recently, earlier this year, realized that a BE, or bioequivalence study, should be done to bridge -- make sure that we are adequately bridging clinical trial material from Phase III to our commercial material.

And then Jim had asked this question before, how are we dealing with the PK characteristics of our drug as it a stable entropatically researching in bile acid. Through very carefully thinking through this design and then making sure that we get regulatory input on the design. That is really why this has been gating. Of course, the timing of that regulatory input and finalization of the protocol and then time to enroll the BE study will determine ultimately how long it takes. It is the reason we think it could be expected to spill over into -- and complete in Q1 next year.

For the mass balance, again, there are a number of steps. It simply takes a long time to set up. We had to synthesize written radiolabeled material within context of our compound of [metalicastic], which was actually a fairly complex thing, but we've achieved this. We then had to do an animal study to establish perfect dosing. Then again are getting expert regulatory feedback on the design of the study and the conduct of the study. Again, this just takes time but we are aggressively pursuing it, and expect to start it in the relative near future.

I want to stress again that these two studies, we view them as pretty routine supporting studies. They are two of quite a number of Phase I studies that will go in support of the marketing applications in the US and Europe. Most of these, as I mentioned before, have already been completed, or are well underway and will be completing this year. We don't see anything -- we don't see really an execution risk, and it is really just a question of the timing being gating.

Thank you. That is helpful.

Thank you. Our next question comes from the line of Liana Moussatos from Wedbush Securities. Your question, please.

Thank you. Given the timing of submitting the NDA and MAA for PBC, when do you anticipate a [FDCA] date would be? Do your runway through 2016, does that include launch in US and Europe for PBC?

Liana, I appreciate the first question but I think it is premature for me to comment on when we could expect a FDCA date at this point. We just don't have enough clarity yet.

With respect to the proceeds raised and whether they include launch, the answer is yes. And Barbara, if you have anything additional?

It includes all the pre-commercialization activities as well as build-out of the team in support of that launch as well.

Will it include the actual launch?

The actual launch, we are still working on the matrix of what that would entail. We have included some base numbers in there. At this point we think it would include those numbers.

Thank you.

Thank you. Our next question comes from the line of Jim Molloy from Summer Street. Your question, please.

Hello, guys. Thanks for taking the questions. Just had a quick question. I know the OBADIAH data you out, the bile acid diarrhea, today at 25 milligram and the SAE profile, very benign. What read-through, if any, can one make from the outside looking in from that trial to the CV side effects and the issues that came up in the 10 patients in the NASH trial?

Thanks, Jim. Thanks for remarking on the bile acid diarrhea data.

I do think that this was a significant and exciting finding in these patients who really do have a high unmet need. Of course, this is the first kind of ex-liver indication we've really tried OCA in. It is good to see efficacy, or signal in these patients. I think -- and the safety tolerability profile, of course, is also quite encouraging. I don't think we can read to other patient populations here, not least because, first these are different patients, but more importantly, this is a two-week exposure.

You referenced the 10. I believe you're referencing the 10 NASH patients in FLINT. Really not 10 patients, rather, but the 10 cardiovascular events that we disclosed earlier this year and have discussed extensively. These were 10 events in seven FLINT patients, about 2.5% of that population. Of course, that population, very much more at-risk of cardiovascular events than your average bile acid diarrhea patient.

Of course, the exposure was much longer, much different. The bottom line is we are encouraged by the results in bile acid diarrhea, but wouldn't draw any conclusions reading on other patient populations.

I think you'll say the 72 weeks versus the 2 weeks maybe a thing, but you marked on BMI index on the NASH patients being dramatically higher than even the PBC patients. Obviously NASH -- well, not obviously, but understanding NASH is indicator of CV side effects.

Is there any BMI scores on the OBADIAH patients that we can look at and say, here is, again, a much more healthy population?

It's a good question. The short answer is no, I'm not aware, at least haven't seen BMIs on these patients.

I don't want to guess and talk out of school. This was a UK-based study in these patients. I don't know what their BMIs are. I do know they have chronic diarrhea and bile acid-related malabsorption.

And then there were, of course, the secondary bad patients with Crohn's Disease, many of whom had had some length of their ileum resected previously. We're talking about very different patients. I wouldn't be surprised if the (inaudible) given the patient characteristics, there was a significant difference in BMI. Again, I hesitate. They are apples and oranges a little bit in my estimation to compare.

I do want to say, though, and thanks for bringing it up, that it is the point I concluded with. That the more clinical data we generate in diverse patient populations, the more confident we become in the overall safety and efficacy of our drug as a novel therapeutic option that we hope will make it to the market, first for PBC and then for an expanding number of indications, both with respect to chronic liver disease, and hopefully ex-liver intestinal diseases.

We are very excited about where we are right now.

A final question, and I thank you for the answer. Speaking of bringing it to market hopefully, assuming it all goes well and it gets approved. Pricing is always an issue or a question that comes up. Early to be thinking pricing, but is there any light you could shed as you think about how this might be priced?

Our thinking on this has -- it's evolving, we are doing more work, quantitative market research work. It is premature for us to give any kind of guidance ourselves on price. I would like to say, and I know a bit of a glib remark, but we are going in the right order here.

Starting off with the orphan indication where we're going to be pricing appropriately for the PBC indication. Then hopefully, if thereafter we get the expanded label for an indication like NASH, which is obviously a much bigger market, yes, we will be facing price erosion.

I think, again, if you look at the -- yourself included, the analysts covering us on the general range that they are modeling for price starting with PBC is in the higher price figures, 50 to shy of 100. Then those who have thought about NASH range down lower, but still mainly in the sort of lower five figures. There are analogues out there of other drugs and other comparable indications that could give confidence about that kind of -- those kinds of pricing assumptions.

Thank you very much for taking the question.

Thank you. This does conclude the question-and-answer session of today's program. I'd like to hand the program back to Mark for any further remarks.

Thanks very much, operator. And thank you all for listening in and paying attention on the webcast. Have a good night.

Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.