Larimar Therapeutics Inc (LRMR) 2016 Q1 法說會逐字稿

Good day, ladies and gentlemen, and welcome to Zafgen's first-quarter 2016 financial results. (Operator Instructions) As a reminder, this call will be recorded.

I would now like to introduce your host for today's conference, Ms. Laura Perry with Argot Partners. Please go ahead.

Welcome and thank you for joining us for Zafgen's conference call to discuss the Company's first-quarter 2016 financial results. As noted on slide 2, today you'll hear from Dr. Tom Hughes, Zafgen's Chief Executive Officer, who will provide an update on the Company's effort to resolve the full clinical hold on the beloranib IND.

Dr. Dennis Kim, Chief Medical Officer, will then review the recently reported beloranib data from the 98th annual meeting of the Endocrine Society's annual conference, or ENDO 2016. Patty Allen, Chief Financial Officer, will discuss first-quarter 2016 financial results. After their formal remarks, management, including Patrick Loustau, President, and Alicia Secor, Chief Commercial Officer, will be available to take your questions. Please note that the slides provided for this call can be accessed at www.zafgen.com.

Before we begin, on slide 3 is a reminder that the estimates and other forward-looking statements included in this call represent the Company's view as of today, May 10, 2016. Zafgen disclaims any obligation to update these statements to reflect future events or circumstances.

Please refer to today's press release, as well as Zafgen's filings with the SEC, for information concerning risk factors that could cause actual results to differ materially from those expressed or implied by such statements. Please also note that this call is being simultaneously webcast online.

I will now turn the call over to Dr. Tom Hughes. Tom?

Thank you, Laura. Good afternoon and thank you for joining us today to review our first-quarter 2016 results and to provide a corporate update. Zafgen's top priority continues to be to work with the FDA to adjust the full clinical hold placed on the beloranib IND in December 2015 and to determine a viable path forward for beloranib in Prader-Willi Syndrome or PWS. We've made significant progress since the beginning of the year and let me walk you through our progress.

Turning to slide 5. In January, we were pleased to report the robust efficacy results from our PWS pivotal Phase 3 ZAF-311 clinical trial. The clinical trial achieved both of its co-primary endpoints, making beloranib the first investigational treatment to improve both hyperphagia-related behaviors and body weight, two hallmark challenges affecting people affected with PWS.

Last month at ENDO 2016, the meeting of the Endocrine Society, we reported new data on the secondary endpoints, demonstrating that beloranib had a positive impact on body composition and cardiovascular risk markers. Dennis Kim will provide an overview of these results in a moment. The full clinical study report for ZAF-311 has been submitted to the FDA, which is one of the elements requested in their clinical hold letter.

We've also completed the psychometric analysis of the hyperphagia questionnaire for clinical trials, or HQ-CT, that we used in ZAF-311. This analysis is a key component in demonstrating the rigor of this caregiver assessment and is a milestone for us, given the importance of the HQ-CT validity in assessing clinical benefits of beloranib.

The psychometric evaluation of the HQ-CT report describes the reliability, validity, and responsiveness of the HQ-CT in ZAF-311. Taken together with the existing evidence supporting the HQ-CT's content and clinical relevance, the psychometric validation result suggested that HQ-CT is a valid measure to demonstrate improvement in hyperphagia-related behavior in patients with PWS and support the use of this measure to derive endpoints in clinical trials. This report has also been submitted to the FDA for review and to support future discussion.

In February, we reported positive top-line data from our Phase 2b ZAF-203 clinical trial evaluating beloranib in adults with severe obesity complicated by Type 2 diabetes. Treatment with beloranib produced statistically significant and clinically meaningful improvements in both body weight and glycemic control in this difficult-to-treat patient population.

These results reinforce the strong efficacy profile of beloranib and further inform the potential of our MetAP2 inhibitor platform to impact body weight and glycemic parameters in people with severe and complex metabolic disorders. Safety data from this clinical trial also contribute to our increasing knowledge and understanding of beloranib for supporting a path forward in PWS.

Turning to slide 6. In addition to these two data sets, we have also reviewed and have been integrating the available clinical and nonclinical data for submission to the FDA to support the efficacy safety profile of beloranib in the PWS population and to provide additional context on the incidence of thrombosis observed in our trials. While the clinical efficacy of beloranib is clear, our ability to move forward with the program requires a plan that ensures patient safety to the greatest extent possible.

Accordingly, we've undertaken a comprehensive multifaceted approach to advancing our understanding of the thrombotic events observed in our trials and to develop a risk mitigation strategy for beloranib in PWS that reduces the potential for more events to occur in the future.

Over the course of the last months and in consultation with experts in thrombosis, PWS, clinical development, and regulatory strategy, we've developed a plan that we believe will allow us to resume development of the drug. We've summarized this plan in a briefing document that we have submitted to FDA and have requested a Type A meeting.

Now, we appreciate that this meeting is of substantial importance to our next steps and to you and the PWS community. We also appreciate that the specific timing of the meeting is of interest to you. We hope that the meeting will be able to take place and be [amended] within the next few months.

We will provide an update on the results of the meeting and our next steps once we receive specific feedback from the FDA. Of course, if there are any material developments, we will update you as soon as is feasible.

To conclude, this has been a very productive period for us. And we have made tangible progress in our next steps toward discussions with the FDA, having assembled and submitted a comprehensive data package and a clinical plan we believe to be both practical and feasible. We should be in a position to provide more clarity on the potential path for beloranib over the next few months.

Let me now turn the call over to Dennis for a brief recap of the clinical data reported in Q1 and recently presented at the end of 2016 meeting. Dennis?

Thanks, Tom. During our last call, we reviewed the highlights from our two recently completed clinical trials. In summary, on slide 8, for both clinical trials, treatment with beloranib was achieved -- has achieved compelling efficacy results in two difficult-to-treat populations who have limited treatment options.

With the bestPWS ZAF-311 data, beloranib represents the first investigational candidate in a Phase 3 randomized controlled clinical trial to improve both hyperphagia-related behaviors and body weight in PWS patients. The ZAF-203 data highlight the potential of MetAP2 inhibition to induce substantial weight loss and improvements in glycemic control in patients with obesity complicated by Type 2 diabetes.

As a reminder, the clinical trial design for ZAF-311 is noted on slide 9. In agreement with the FDA, we analyzed the data using a mixed model repeated measures, or MMRM approach, to account for any missing data for the ITT population, including the patients who didn't have an opportunity to complete 26 weeks of randomized treatment due to the suspension of dosing following the partial clinical hold in October 2015.

The clinical trial achieved both co-primary endpoints: absolute change in hyperphagia-related behavior as measured by HQ-CT total score and percent change in body weight compared to placebo. As you can see on slide 10, for the hyperphagia endpoint, we see a response served early in the treatment period that is sustained over the course of the clinical trial.

With respect to body weight, the placebo group showed gradual weight gain through the course of the trial, while both beloranib treated groups had statistically and clinically significant weight loss that was progressive and sustained with no evidence of a plateau. The placebo-adjusted weight loss result was up to 9.5%.

In April 2016, we had the opportunity to present the full efficacy data set from the bestPWS Phase 3 study at the Endocrine Society annual scientific conference in Boston, known as ENDO 2016. Dr. Merlin Butler, one of our principal investigators, highlighted the top-line data in an oral presentation. And two poster presentations provided the data for key secondary endpoints, including body composition, key lipid parameters, and cardiovascular risk factors.

At ENDO 2016, we reported new clinical data demonstrating that treatment with beloranib results in a significant improvement in body composition as assessed by DEXA scan. Specifically, as you can see on slide 11, beloranib demonstrated a statistically significant reduction in total body fat mass at both the 1.8-milligram and 2.4-milligram dose levels.

Importantly, total body lean mass was minimally changed from baseline with a 0.5-kilogram loss in the 1.8 milligram, 0.7-kilogram loss in the 2.4-milligram beloranib arm, and an increase of 0.7 kilogram in the placebo arm. Approximately 90% of loss in total body mass with beloranib was due to loss of body fat, indicating preferential loss of fat with maintenance of lean mass.

This is of particular importance and benefit to patients with PWS because studies have shown that PWS is associated with greater total body fat mass and reduced lean mass for a given BMI compared to conventionally obese patients. As you can see by referencing the baseline measurement in the table, which shows that patients in the bestPWS trial had greater than 50% total fat mass at baseline.

Turning to slide 12, treatment with beloranib was also associated with improvements in select markers of cardiometabolic risk. We observed a statistically significant decrease in total and LDL cholesterol levels at both dose levels, even before much of the body weight loss had occurred. And also saw a statistically significant decrease of high-sensitivity C-reactive protein or hsCRP in both treatment groups.

Taken together, these data suggest the potential to reduce cardiovascular risk and reinforce the power of MetAP2 inhibition to impact complex metabolic disorders.

The response from the PWS scientific and patient advocacy community to the totality of this efficacy data has been very encouraging, furthering the perspective that treatment with beloranib resulted in a clinically meaningful benefit to patients across a number of important endpoints that impact morbidity and mortality and overall quality of life of PWS patients.

As previously disclosed and summarized on slide 13, across the completed trial comprising the beloranib clinical program, there has been an imbalance of venous thromboembolic events, or VTEs, reported in patients treated with beloranib versus placebo.

We recently received the autopsy report we had requested regarding the first patient death in clinical trials of ZAF-311. And the cause of death has been confirmed to be bilateral pulmonary embolism due to deep vein thrombosis. There was no other information in the autopsy report regarding the cause of death that has shed light on the ideology of the VTE or PE.

The report has been submitted to the FDA for their review, as requested. And we have updated the slide to reflect the finding of that autopsy report. We remain committed to more fully understanding the VTEs observed in our trials and working with the FDA on a path forward for lifting the full clinical hold and continuing the development of beloranib in PWS.

Finally, to give you an update on presentations and posters at upcoming or recent meetings, we have had all three abstracts from ZAF-203 that were submitted to the American Diabetes Association accepted as latebreaking data for poster presentations in New Orleans in June. In addition, last week we presented three abstracts from study ZAF-311 at the International Congress of Obesity, or ICO, in Vancouver that were similar to the posters at ENDO 2016 and similarly accepted as latebreaking posters. As Tom mentioned earlier, our focus remains firmly on beloranib for PWS during this critical time for the Company.

I will now turn the call over to Patty for a review of the financials.

Thank you, Dennis, and good afternoon, everyone. I hope everyone has had a chance to review our press release, which details our first-quarter 2016 financial results. I will provide a high-level review of our results during this call along with some insights regarding our results compared to the fourth quarter of 2015.

Turning to slide 15, for the first quarter of 2016, we reported a net loss of $17.7 million or $0.65 per share compared to a $13.5 million net loss or $0.53 per share for the quarter ended March 31, 2015. Our operating losses for the first quarter of 2016 as compared to the first quarter of 2015 were primarily driven by research and development costs associated with our beloranib development program, including work related to the bestPWS ZAF-311 Phase 3 clinical trial and the ZAF-203 clinical trial in severe obesity complicated by Type 2 diabetes, for which we reported results in Q1 of 2016.

There were also expenses incurred in Q1 2016 related to our second-generation MetAP2 inhibitors and ZGN-839 programs. We also incurred increased personnel-related costs in R&D in Q1 of 2016 as compared to Q1 of 2015 and had an increase in non-cash stock-based compensation expense period over period.

Moving to research and development expenses. R&D expenses were $12.5 million through the quarter ended March 31, 2016, as compared to $10.2 million for the first quarter of 2015. Included in the first quarter of 2016 were costs of approximately $6.1 million associated with the advancement of the Company's beloranib program, primarily clinical trial and CMC expenses related to the ZAF-311 and ZAF-203 clinical trials as well as the work we are conducting to resolve the full clinical hold on the beloranib IND. Also included are expenses of approximately $350,000 associated with our ZGN-839 program and $1.3 million related to our second-generation MetAP2 inhibitors.

Personnel-related expenses totaled $2.2 million in the first quarter of 2016 as compared to $1.2 million in the first quarter of 2015 as we hired approximately 20 new employees in R&D since the beginning of calendar year 2015, with the majority of those hires occurring prior to Q4 of 2015. And finally, we also saw an increase in non-cash stock-based compensation expense that totaled $828,000 for the first quarter of 2016 as compared to $404,000 in the first quarter of 2015.

Moving on to general and administrative expenses. G&A expenses were $5.4 million for the quarter ended March 31, 2016, as compared to $3 million in the quarter ended March 30, 2015. The increase was primarily due to a significant increase in non-cash stock-based compensation expense during the first quarter of 2016, which totaled $1.9 million compared to $654,000 in the first quarter of 2015 as well as increased professional fees of approximately $700,000.

With respect to our cash position, as of March 31, 2016, we had cash, cash equivalents, and marketable securities totaling $166.2 million. We have a strong balance sheet and feel very comfortable that we will end 2016 with a cash position in excess of $100 million.

We currently expect that this cash position will be sufficient to fund our operations well into calendar year 2017. We will provide more specific financial guidance once we have better clarity on the path forward for beloranib.

We are focused on managing our spend during 2016 until we clarify the potential path forward for beloranib with the FDA. Our operating expenses for Q1 2016 were $5.3 million less than Q4 of 2015. We completed the ZAF-311 and ZAF-203 clinical trials in Q1 2016 and reported those results. This quarter, we have spent resources to address the full clinical hold on our beloranib IND.

And importantly, we have held our spend in G&A flat this quarter. We are also maintaining headcount at a very lean level. We have less than 50 employees at Zafgen and added only 3 hires during Q1 2016. We are financially well positioned to execute on our strategy to work to lift the full clinical hold on the beloranib IND and pursue our key programs in 2016.

With that, I will turn the call back over to Tom for closing comments.

Thank you, Patty. As Patty just mentioned, we had three hires during the first quarter of 2016. I'd like to highlight one of these. Dr. Kasra Kasraian has joined Zafgen as Head of Pharmaceutical Development and Manufacturing.

Kasra has over 23 years of experience in pharmaceutical and biotech industry, primarily focused on product and process development and overall CMC management for small and large molecules. He joins us from Biogen Idec, where he was a program leader for hematology, cell, and gene therapy programs.

His expertise will be invaluable as we build our organization to effectively support the launch and ongoing demands of a commercial product while simultaneously supporting the CMC drug development activities required for our earlier-stage candidate. We look forward to his contributions.

I'd also like to mention that May is PWS awareness month. We appreciate the continued support of the advocacy groups in the PWS community. Zafgen has put out a video to support disease awareness and tweeting throughout the month of May to show our support for PWS.

Before we open the call for questions, let me close by saying that over the past few months, we've developed what we believe is a comprehensive data package and a well-informed risk mitigation strategy for beloranib in PWS that we'll discuss with FDA. We look forward to having a dialogue with the Agency and at the appropriate time communicating to you with more clarity the path forward for beloranib. We thank you for your continued support during this critical time for the Company.

We'll now open the call for questions.

(Operator Instructions) Joseph Schwartz, Leerink Partners.

Thanks very much for taking my question. I was wondering, first of all, if you can tell us anything at all about the proposed plan to manage patient safety and what that's likely to entail. I heard you say that you've developed a plan that you think is practical and feasible. So can you give us any insight into what that means?

Yes. So thanks, Joe, for the question. This is Tom. So yes, we are actually really very pleased with the plan we've developed. I'd say for the time being, it's really we need to sort of focus on discussion of the plan with the FDA.

The plan has taken into account all the great feedback we got from the thrombosis experts we've worked with, in going in depth through the data that we generated over the course of the last many months. It's also come through conversations with the PWS community, particularly our investigators from the trial, as well as through our regulatory strategy consultants.

And so it would be premature, we think, to really talk in specifics about what the plan is. But just to say that it is a plan that will really be focused on reducing to the greatest extent possible the risk for thrombotic events in the course of our trials moving forward.

I will add that it does include a trial and that trial is really focused on validation of the risk mitigation strategy that we are to be testing and move forward with. So sorry to say, we're not going to provide any greater detail than that, but we certainly appreciate why you are asking the question.

Okay, thanks very much. And just one more clarification question, if I may. What is your expected communication strategy to the Street around the meeting? I'm wondering such things as will you communicate when the meeting is scheduled? And/or after you've had the meeting, minutes from the meeting? What are the likely scenarios there for you and us?

I think with regard to the specific timing of the meeting, we don't really want to sort of encourage speculation in any sort of specific timeframe. We understand why this is of interest to people, but it's our plan basically to have the meeting, to get the minutes from the meeting, which we believe, and I think you'll agree, are critical to being sure of what it is that we are communicating coming out of the meeting.

So once we have that and as soon as we can fully sort of discuss and digest the content of the meeting and the minutes, we'll communicate as quickly as we can to all of you regarding what we've learned.

You know, the timing of that, of course, depends on the meeting itself and how quickly the minutes are turned around. So it's hard for us to say exactly when that might happen, but it is our intention to come back as quickly as possible.

And what I would say is of course, if there is anything that is immediately material that comes out of the conversations we have with the FDA or our own decisions that we would take after that, we'll communicate those as quickly as is practical.

Thanks for taking my questions.

Phil Nadeau, Cowen and Company.

Thanks for taking my questions as well. I guess first, on your clinical and nonclinical assessment of risk, could you share with us anything that you learned through that process about what it is that maybe increases a patient's risks or susceptibility to thrombosis?

Yes. So we can say a little bit to that. What we have learned -- we've done a lot of evaluation of the plasma samples and the background characteristics of the patients who were enrolled in both of the trials, the ZAF-311 and 203 trial.

And what we can say is that it came back fairly clearly to us that at baseline, at the time of entry into the trial, patients of PWS appear to have higher levels of a number of coagulation parameters that put them into the normal range. And so this fits well with some of the epidemiologic work that we are doing that suggests that patients with PWS experience thrombotic events at a higher rate than conventionally obese patients.

And so we are studying the drug in a clear background of increased through coagulation potential. And so this is something that's really quite important for us to sort of integrate into our thinking moving forward.

Beyond that, we've done a rather extensive series of evaluations of basically what happens when you add beloranib directly to assays of coagulation. And what we can say right now is that it doesn't appear that the drug itself can trigger coagulation, but clearly there is some relationship that may be present between the drug and in the setting of treatment in vivo or in the clinical setting. This is something we need to understand better, but as of right now, there is nothing that we could point to that would suggest the drug is capable of triggering coagulation events per se.

So we are dealing with a hyper coagulable population and perhaps a drug treatment that is in some way accentuating that effect. And that's basically where we stand today.

And a follow-on to Joe's question about the risk mitigation strategy. Appreciating you don't want to get into the details, but is there any way that you can modify the risk in an individual patient using prophylaxis or something else? Or do you have to resort to limiting the patients who could potentially go on beloranib?

We've certainly explored all of those options and we would argue that each of them represent a meaningful approach to the problem. One might argue that the prophylactic strategy is more direct and more straightforward.

Having said that, though, we are really dependent upon our conversation with FDA to be able to really provide any color on what it is that we are likely to be able to do in the future. So we'd really prefer to have that conversation directly with FDA rather than to have it sort of circulating externally. So we are not able to comment directly on the specific nature of our plan.

And the trial that you mentioned, of the risk mitigation strategy, is it possible that you could have several strategies tested in this study? Or is it likely that you'll just test one, kind of go with the one that is the FDA's favorite?

I think it will be a negotiation. We have our favorites. We've learned probably quite a bit about this, as you might imagine, over the course of the last many months.

But I think, again, since it's probably premature to speak to exactly what will come out, but you can probably imagine that there are multiple ways in principle to address this problem. And we are open to discussion of any approach that provides both a practical strategy that has real-world applicability as well as something that is in the best interest of the patients as we move along. But again, I'm sorry to be vague, but we really want to have this conversation first with the Agency.

Fair enough. And then just one last question for Patty. I appreciate that you don't want to give forward-looking guidance until you have the feedback from the FDA and a path forward.

But over the next couple quarters, just generally, is the spend that you had in Q1 more or less what you expect for, say, Q2 and Q3? How expensive are some of these things that you've been doing to analyze beloranib?

That's a fair question. And I would say that we would expect Q2 and Q3 to be similar to Q1. There are moving parts, but we don't see big swings in our expenses.

But what I will say as well that the guidance we are giving does include the potential that we will resolve the clinical hold for beloranib with the FDA and hopefully be starting a new clinical trial. So that is included in that guidance. Once we know the path forward, then we'll give a little bit more specific guidance.

Great, thanks for taking my questions.

Simos Simeonidis, RBC Capital.

Thank you for taking the questions. I just want to clarify what you said about the potential of doing a study. Are you proposing to do a study to test the thrombotic potential for thrombotic effects of the drug?

Is this kind of your way back into development? Is this something you are proposing to the Agency? Is it something the Agency asked of you in your preliminary discussions? Could you please elaborate on that?

This is Tom. So basically what we've been charged with is to develop a path forward that allows us to use the drug in a way that does not cause an unreasonable risk of serious issues to arise during the course of treatment.

So our approach to the plan that we are putting forward really is focused on really what we would consider to be a next step toward development of the drug. And this is really to validate the risk mitigation strategy in the setting of an efficacy trial moving forward.

So it's really a next major step, not a small trial that we are proposing. Not as mechanistic or sort of a like a technical type of a study. This is really a major trial that we are proposing.

And so this would be a portion of an efficacy trial? It would be like the first part of a trial or would be incorporated into the full portion of the trial?

You know, all I would say is that the trial that we are contemplating would both confirm efficacy and allow us to validate the risk mitigation approach.

Okay. And then Tom, in your prepared remarks, you -- I don't remember the exact words you used, but you said something that you feel confident or you believe that you should be able to resume development. And again, I know I'm paraphrasing. I hope I'm not misquoting what you said.

First of all, you were talking about beloranib, not necessarily the follow-on compound. And secondly, you've been -- throughout this process, you've been very conservative, I think, and cautious. This is the first time I think we've heard you being more on the optimistic side. What is -- and again, correct me if I'm wrong, but what is it that gives you the chance to be more on the optimistic side now?

First of all, I would say I probably threw a we believe in there just to be careful. But no, we do feel very, very positively about the approach that we've developed. Let me just say that this is a process that we've been really living and breathing for the last many months.

I think I've said in the past or we've said in the past on our call that the bad news is that we are experiencing an imbalance in thrombotic events. The good news is that we are experiencing events of a thrombotic nature that basically -- they feed into an enormous amount of know-how.

There are many tools that are available to assess thrombotic risk, to understand thrombotic activities, to screen and monitor for these things. There are also great drugs available to treat them.

So this is an area that has been worked out successfully for other drugs. You know, a drug such as REVLIMID, for example, or thalidomide. And so we are in an area that has been previously successfully navigated.

And so I think what we've done is we've put together a very robust plan. We put every last bit of energy that we've had in the Company into this, and it has been vetted in ways that I think would be considered to be robust by anybody who would look at it.

So we've put our very best foot forward. We've done so following conversations with FDA about what it is that they would expect to see in this type of a briefing document. And so, if it can be done, I think we are ready to do it. We've done everything we possibly can, and yes, we feel pretty good about it.

So just how and when we might be able to move forward of course can only be answered once we've had the conversation. But it is a conversation that will happen sooner than later at this point.

And you are right. It is about beloranib and not about a new compound. So this is our approach to getting beloranib back on the rails and to move forward in a way that brings the product a bit forward for the sake of these patients. So I hope that answered the question as well as possible.

It does, thank you. And one final one for you. Throughout this process of putting together your risk mitigation plan, have you been able to have formal or informal interactions with the Agency to get their feedback and input into putting together your plan?

Yes, we have. So we've had a couple of interactions with them, largely focused on what the nature of the information is that they would wish to see, how they would like to have it sort of arrayed. What it is that they -- at least without any formal evaluation, what they would sort of steer us toward and away from. So we've had, I would say, a very open and very, I would say, collegial conversation or relationship with the Agency on this.

And I would like to point out, and we've said this before. This is a group at the FDA that really has taken a lot of effort to learn about Prader-Willi Syndrome, to understand what it is to have the syndrome. And they really fully understand as best as we can understand, at least, the severity of this condition and the need for therapies.

And I think you'll agree that we have a drug here that really appears to show tremendous benefit in this population. So the stars, if possible, have aligned as well as possible to allow us to move forward with this.

So we have an FDA that is informed and open to dialogue. And we are really -- this may sound gratuitous, but we are really looking forward to having the conversation with them. This is a great opportunity for us to move ahead and we are really quite excited about getting down there to talk to them.

Great. Thank you very much for taking the questions.

Christopher James, FBR and Company.

Thanks for taking the questions. Congrats on your progress, specifically with getting your risk mitigation strategy in place. I know you are not commenting specifically on the strategy, but are there any, I guess, restrictions to anticoagulation in the pediatric setting? Are there different strategies in pediatrics versus adults?

Yes, sure. So you are probably aware that very few, if any, of the available oral anticoagulant drugs are available or indicated for use in the treatment of pediatric patients. It would be -- I really probably shouldn't get into much more beyond that, except to say that that is an area that would represent sort of going off the path basically. So you are right to bring that up.

Great. Thanks for taking the question.

Jason Butler, JMP Securities.

Thanks for taking the question. I don't think I can ask in any different ways about the plan, so I'm not going to try. I guess just a data question. A question about the recent data you've presented at medical conferences.

You talked about some of the DEXA data you had. I was wondering if you could remind us, either clinical or preclinical data, if you have any information about the type or metabolic activity specifically of the fat that you are addressing with beloranib?

This is Dennis Kim. We don't have details about the type of fat. We've never taken a fat biopsy, per se. But the DEXA scan, the waist to hip circumference and bioelectrical impedance data that we've collected in the past trials all point to one thing. And that is that there is a preferential loss of fat over lean mass and that a lot of this fat loss is coming from the central part of the body, suggesting that perhaps visceral adiposity is being improved.

But we didn't -- in order to look at visceral adiposity specifically, you have to use a different methodology than DEXA scans. So we don't have that level of detail, but everything is pointing in the right direction.

Okay, great. Thanks for taking the question.

Yes. And Jason, maybe I'll just follow up to say -- and so your comments about our being, let's say, cautious about sharing details in the trial. I just hope that you and everybody else appreciates that this is something that we really just -- whatever it is that we are proposing will be subject to a conversation with the Agency.

And so to talk about our plans would only sort of potentially add to, let's say, forces coming into the FDA from outside, outside of our control. And we are really just trying to protect our relationship with FDA to make sure that the conversation we have with them is the conversation that we have with them and that is not coming in from the outside.

So this is really to preserve the integrity of that meeting and not to in any way be obfuscating. So once we're done, we'll be happy to share what it is that we're talking about with them. But we do really want to get to that meeting with them and not to have that meeting occur in the public domain. So that's just a request that we have or, let's say, a stipulation that we are putting on that.

Thanks. That's very clear and a prudent approach. Thank you.

(Operator Instructions) Edward Nash, SunTrust.

This is Mike Guo for Edward. Thanks for taking the questions. So I guess -- we understand that you do not want to comment on the timing of the meeting with FDA, but have you requested a meeting with FDA yet or not? Could you share any information there? And also, if that's a Type A meeting, please?

Yes, we have and yes, that is correct. It would be a Type A meeting to address the hold.

Great, thanks a lot. And a quick follow-up, please. We understand that beloranib is the focal point at this moment, but could you share any updates on the ZFG-839 (sic - ZGN-839) oral compound for NASH? Would you be able to share any additional preclinical studies? And could we expect to see the Phase 1 trial initiation this year?

With regard to 839, what FDA sort of asked for us to do -- and I'll remind you this is a different division at the Agency. It's the gastroenterology division. And so we were asked to provide, first of all, the clinical study report for ZAF-311. That's in.

We were asked also to provide basically the results of a 13-week toxicology study that remains in progress. So that has not been completed yet. It has been going on and it's -- to wrap up relatively soon, but not done yet.

And then we were also asked to evaluate the impact of direct exposure of ZGN-839 to a range of different thrombotic or sort of coagulation assays. That work is in progress. We're not able to comment on that just yet, but just to say that all that is coming together.

Lastly, in order to put the safety results into context, we are also running a series of studies to really very carefully pin down the therapeutic index or the therapeutically effective dose of ZGN-839 in those same species. And so that's another sort of parallel work stream that we are doing to make sure that we are -- if we are to get back in the clinic that we are likely to be able to achieve exposures that are both effective and that are in an area that we believe would be safe.

So all that is going on. We can't comment just yet on when we'd resume that study, except -- or to run the study, except to say that it's a work in progress. I will comment that our second-generation compound continues to advance and we are looking forward to moving that ahead. And we'll give an update on that as we make more progress with that as well.

Okay, great. Thanks a lot.

Thank you. And I am showing no further questions at this time. I would like to turn the call back to Dr. Tom Hughes for any further remarks.

Great. Well, thank you. I'd just like to thank everyone again for joining the call. We've had a very productive several months and look forward to updating you on our progress over the course of the next few months. So enjoy the rest of your day. Thank you.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude today's program. You may all disconnect. Everyone have a great day.