Oncternal Therapeutics Inc (ONCT) 2006 Q2 法說會逐字稿

Good day, ladies and gentlemen and welcome to the Second Quarter 2006 GTx Incorporated Earnings Conference Call. My name is Sharon and I will be you coordinator for today.

[OPERATOR INSTRUCTIONS].

I now would like to turn the call over to one of your hosts for today, Mr. McDavid Stilwell, Manager of Corporate Communications. Sir, please proceed.

Thank you, and good morning. On behalf of GTx, I'd like to welcome you to our Second Quarter 2006 Conference Call. We released our results earlier this morning through the new wire. If you do not have a copy of the release and want one, you will find it on our website at gtxinc.com. We will have a replay of this call available on our website until August 11, 2006. With me today are Dr. Mitchell Steiner, Vice Chairman and Chief Executive Officer; Marc Hanover, President, Chief Operating Officer; and Mark Mosteller, Chief Financial Officer.

Following this introduction, Dr. Steiner will highlight second quarter clinical and corporate developments. Next, Mr. Hanover will briefly detail our financial performance for the quarter. Dr. Steiner will then share with you plans for the rest of the year and make a few closing remarks. We'll then open the call for questions.

Before we begin, I'll remind you that information discussed on this call may include forward-looking statements, and such statements are subject to the risks and uncertainties we discuss and detail in our reports with the Securities and Exchange Commission including in our quarterly report on Form 10-Q file May 5, 2006. We express disclaim any obligation to release publicly any updates or to the statements made during this call.

Now, I'll turn the call over to Dr. Steiner.

Thank you, McDavid. I'm pleased to report that in the second quarter, GTx made substantial progress in the development of its drug candidates and toward our goal of commercialization. In the pivotal Phase III clinical trial, evaluating ACAPODENE 80 mg for the treatment of multiple serious side effects and through deprivation therapy, we conducted an interim analysis of lipid profiles in the first 197 men to complete one year of the trial.

Elevation of total cholesterol leading to a higher cardiovascular mortality is a known serious side effect of ADT. ACAPODENE treated patients compared to placebo had statistically significantly lower cholesterol, LDL, triglycerides and total cholesterol to HDL ratio and higher HDL. This is the second positive data Phase III interim analysis we have conducted in our ADT trial. The first interim analysis was a BMD, another secondary end point conducted in December 2005 in the same cohort of patients. ACAPODENE treated patients had a highly statistically significant increase in bone mineral density in all three skeletal science measured compared to placebo. As you know, osteoporosis increases the risk of life-threatening fractures in patients on ADT. And by the way, these data were presented at ASCO by our lead principal investigator, Dr. Matthew Smith from Harvard Medical School.

Let me pause for a moment to talk to you about what this means. We now have data from this pivotal Phase III ADT clinical trial. It showed that ACAPODENE addresses at least two side effects of ADT in patients with advanced prostate cancer. We believe that these positive effects on both bone and lipids differentiate ACAPODENE from other potential competing drugs that are being developed for this indication as they only treat osteoporosis. This distinction in the marketplace will become even more evident if ACAPODENE ultimately shows benefit for hot flashes and gynecomastia too. This would allow patients taking multiple drugs for multiple side effects of ADT to be able to take one drug to treat the multiple side effects.

In order to collect additional blinded fracture and safety information in these ADT patients to support, if needed, the pivotal Phase III ADT clinical trial, a one-year Phase III/b extension trial was initiated and it's now enrolled. It should be emphasized that this extension trial is a separate study and should not affect our timelines to complete and report data from the pivotal Phase III ADT clinical trial, which we're conducting under an SPA with the FDA. We anticipate receiving data from the Phase III ADT clinical trial in the second half of 2007.

In May, we attained our enrolment goal in the pivotal Phase III PIN clinical trial for ACAPODENE 20 mg for the prevention of prostate cancer in men with high grade PIN. I am proud of the GTx team for enrolling this large study in less than 15 months. We believe that this rapid enrolment reflects not only that urologists are concerned that men with high grade PIN are in high risk for developing prostate cancer, but also that these patients with high grade PIN, if given the opportunity, are eager and motivated to prevent progression to prostate cancer.

The timeline for receiving efficacy data from our pivotal Phase III PIN trial is becoming clear now that we've reached our enrolment goal. The trial's SPA with the FDA allows us to conduct and interim efficacy analysis after a certain number of prostate cancer events have occurred. If this efficacy analysis attains the requisite statistical parameters, we will proceed with filing a new drug application. We still anticipate conducting that analysis during the period between the fourth quarter of 2007 and the first quarter of 2008.

We have made good progress with our partners in the development of a non-invasive PIN test. As you are aware, we supplied blood and urine samples from high grade PIN patients in our Phase II/b and now our Phase III PIN trials to help these diagnostic companies test their respective [lagers] for high grade PIN and prostate cancer. One of these companies is MacroArray Technologies, and they have discovered a protein called ABCA5 protein, which is over-expressed in the urine from patients with high grade PIN. They are developing at this time a polyclinic [alias] and have continued to develop this test. In fact, their work in the form of abstracts were presented at the recent AACR and ASCO meetings.

The number of patients diagnosed with high grade PIN through prostate biopsy is already a large market, so I don't need to stress how significant a non-invasive test would be in dramatically increasing the pool of potential patients. No, that covers our quarterly update of our two Phase III lead programs. Now, let me tell you about our SARM program and the continuing rapid advancement of ostarine.

We initiated during the quarter, our proof-of-concept Phase II clinical trial in Europe, and last week we announced that the trial is now fully enrolled, again meeting our enrolment goal, a credit to our clinical operations team here at GTx. This ostarine, three-month clinical trial is designed to collect comprehensive data on the efficacy and safety of ostarine at multiple doses in 60 elderly men and 60 post-menopausal women. End points of the trial included measurements of lean body mass and bone. The results of this Phase II clinical trial will provide GTx with the information to assess and to select the best acute and chronic indications and what their [velcaplat] path would be.

At ENDO 2006, which was held in June in Boston, GTx had several presentations. In the first presentation, pre-clinical data was presented on the novel aspect of SARMs as therapy for osteoporosis, highlighting their ability to reduce bone reabsorption, to build bone and to increase muscle mass. Building muscle may help to improve balance and gait and to provide increased cushion in the event of falls, which is the primary cause of hip fractures. Thus, SARMs may have three ways to prevent hip fractures, stop bone loss, build bone and build muscle.

In the second GTx presentation, our scientists shared some details of our G-Nome wide mapping of the antigen receptor Binding Sites. GTx scientists have used this kind of information to better understand SARMs and to continue to build a robust pipeline that firmly establishes GTx as the leader in the development of this exciting new class of drugs.

And now, I will turn the call over to Mark for an overview of the financial results for the second quarter. Mark?

Thanks. Good morning. The details of our financial results for the second quarter 2006 are included in this morning's press release and are available on our website. I will primarily focus on the highlights. At June 30, 2006, the company had cash and cash equivalents of $55.6 million with no debt and no warrants. The net loss for the second quarter was $10 million or $0.32 per share. Revenues for the quarter were $600,000 including $288,000 in net product sales of FARESTON with collaboration income from Ortho Biotech on andarine providing the balance. As for our 2006 guidance, we still expect a net loss for the full year of between $37 million and $47 million. Based on current spending projections, we anticipate our cash will last through the first half of 2007.

I will now turn the call back to Mitch.

Thank you, Mark. In April, during the first quarter conference call, we said we expect to announce a partnership for European alliance for ACAPODENE within the next six months. We are making good progress, and I have great confidence that we will soon make an announcement about this European ACAPODENE partnership. We're also in discussions for potential partnerships for the commercialization of ACAPODENE in Asia. And as you know, our goal for ACAPODENE is to retain US rights and to partner ACAPODENE in the rest of the world.

As a result of our progress developing ostarine through Phase II, there has been intense interest from several large pharmaceutical companies, and we are analyzing our options for a partnership opportunity here as well. GTx continues to maintain a clear lead in the development of SARMs. There will be steady data news out of ostarine development program during the remainder of this year. We expect to report data from the proof-of-concept Phase II clinical trial at the end of the fourth quarter. With that data in hand and after meeting with the FDA for regulatory clarity, we will be prepared to select the acute chronic indications and share with you the clinical development task for the pivotal Phase II/b/Phase III clinical trial, which we expect to initiate in the first half of 2007.

Operator, we are now ready to take questions.

Thank you.

[OPERATOR INSTRUCTIONS].

And, our first question will come from the line of Joel Sendek from Lazard Capital Markets. Please proceed.

Hi. Thanks a lot, a question on ostarine. Based on what you just said Mitch, in matching that up to what it says in the press release, it says that you guys plan to initiate a Phase II/b or Phase III clinical trial in the first half of 2007. So, my question is, regardless, would you expect that to be a single pivotal trial? Or, might you need an additional trial prior to registration?

It's a great question. It depends. And you see, one of the nice things about doing this Phase II trial is we're going to get the information that we need to go to the FDA and ask that very specific question. So, it's hard to give guidance on whether this can be a single trial or whether this is going to be a pivotal trial, whether we need two trials? It all depends. Our goal is to go after two kinds of indications. One would be an acute indication, which would be basically a three-month treatment. Those trials tend to have less patients, and they're a shorter duration. And, the plan would be at some point also to start a chronic indication.

Again, the incredible value of these molecules to be able to treat both muscle and bone loss and to get a better understanding from the FDA, I will tell you what we are doing behind the scenes while we're waiting for our Phase II data is we are preparing meetings with the FDA for these multiple indications in the form of a pre-ID meeting so that we can understand better what the regulatory path will be. So, when we get on the phone and tell you or stand up at the podium and tell you, this is the path we're going to take, and we'll have much clearer regulatory pathway. And so, at this point now until we have data and until we have those meetings with the FDA, I think it would be premature to say.

Great. And then, that's helpful. And just quickly on the ADT extension study, I thought that was if I remember correctly, a three-year extension.

No. And, I'm glad you're asking that question. Here's the concept. The question is, is this a three-year ADT extension? No. What we've done is, the trial under an SPA is a two-year treatment trial.

Yes.

So, these 1,400 patients are now in the trial, fully enrolled and they're marching along. And, the concept here is when the patients start rolling off this trial, your choices are compassionate use or to go ahead and put them into an extension so that you can collect additional information. So, the concept here is, since they're going to be blinded anyway, because you're not going to know when they come off the trial whether they're on drug or not --.

Yes.

And, it's a two-year treatment phase, let's catch the majority of those patients and get another year of data. So, they're essentially the same patients in that same trial, just adding another year of data to just basically help us gather more safety information and to help us with additional fracture information and side effect information so that when we look ahead at label, for example, we'd be able to have more than just two-year data to talk about.

That was never envisioned as a three-year extension? It was envisioned as an opportunity to capture three years of continuous data?

Correct.

Okay, great. Thanks a lot.

And, our next question will come for the line of Meg Malloy from Goldman Sachs. Please proceed.

Thank you, very much. Just following up on the previous question, I'm a little confused. How can you describe a potential study as Phase II/b or a Phase III if the indication isn't clear?

That's -- what you can say is, you've done a Phase II. And, the data that we've collected in our Phase II is in men and women. And, they're going to be in the patients that are going to be -- I'm going to back up. And, the efficacy data that we're collecting in these men and women will serve well for a Phase II. So, you've got the multiple doses and its dose finding. We're going to use those data as a basis of proposing to the FDA whichever indication that we're going to them with. Once you go to an indication, no matter which one you start, it's going to be -- if it's muscle wasting or bone wasting or both, you've got your preliminary -- you've got your Phase II data in terms of effect.

Then, you -- that's why we called it a Phase II/b, because then what you're doing in that setting is, you're taking the information you learned in your Phase II and expanding in a Phase II/b. I some instances, and again this is -- I didn't say we were going into this indication, but in some instances some indications, especially the acute indications and especially if the patients are very sick, you can do a II/b/III for example. For the chronic one --.

Can I ask Mitch, just to follow up on Joel's question, what indications are you thinking about? [inaudible]

I'll tell you the ones that we're thinking about, but don't hold me to them until we understand the regulatory clarity, but anything with a muscle wasting or bone wasting. We're thinking about -- still thinking about the burn population that we've talked about before, cancer wasting, end-stage renal disease wasting, anorexia, aging are some of the acute indications. For the chronic and just not really comprehensive, just sort of a short list. And then for the chronic indications, we're looking at things like osteoporosis and frailty.

And, what needs to be done in terms of the US filing and IND here?

What needs to be done?

Yes.

All that needs to be done at this point is, after we have our pre-ID meeting, we know which division that we're going in, we basically file the Phase II/b/III protocol based on what they've told us in the pre-ID meeting. We submit all the data that we have to date. So, what it would take is that you file it and basically, you wait 30 days and you're ready to go.

And, just one final follow up on that, I know you had originally talked about burns, but maybe I don't remember this correctly. But, it seems that you were -- you wanted to go ex-US and get a body of data in older patients first before you went down that path, maybe because of the potential requirements of the size of the study. How are some of these other indications different?

How are some of the other indications sites --.

Yes, the clinical requirements, year-end.

Oh yes. Again, the clinical requirements, you just have to show muscle and bone activity quantified. But from a regulatory requirement, that's where we need to get clarity.

Okay, thank you.

Sure.

And, our next question will come from the line of Eric Schmidt of Cowen & Company.

Yes, good morning. Mitch, on the ACAPODENE ADT trial in terms of the lipid benefit that you've seen, can you just remind us if you're collecting data on cardiovascular event rates? And, I assume obviously, the trial is not powered to show a benefit there, but whether that might have been a secondary end point of --.

Yes.

Sorts, either in the trial or the extension phase.

Yes. You hit the nail on the head, Eric. Usually cardiovascular events, you have to have these 5,000, 10,000 patients filed even -- so, it's not powered for that. So what we've done is, we're collecting the lipid data, but the cardiovascular information is being collected as SAEs and AEs, if you will. So, we'll be able to capture that data. We'll be able to comment on that data, but there's really not going to be much of a statistical analysis on that data only because it's not powered for that.

The statistical analysis, however, will be on the lipid profiles where as you know, we saw a decrease in cholesterol and an increase in HDL in those patients on our trial. And, we'll be able to statistically evaluate that, and that is the secondary end point.

Okay, that's helpful. And then, I think in terms of your partnership goals, you lost me a little bit on ostarine. I understand that there's significant interest in that product. But, I guess what I was missing is how that might impact your desire or ability to partner ACAPODENE ex-US.

Okay. So, make sure I understand the question. So, the question --.

Well, maybe they're totally separate and I just --.

Yes. They're kind of separate, so our thinking is -- I'll just take a step back. So, from the ACAPODENE standpoint, we've been saying all along it was working diligently to execute a partnership in Europe. As I mentioned in my -- in our call last quarter that we said it takes six months. As I mentioned in the call today, we're making good progress, and we're anticipating to announcing here that. With that behind us, now the question is, let's focus on Asia for the rest of the ACAPODENE life, and therefore we would fulfill our requirement, which is to keep US rights and to pipe -- license out Europe and to license out Asia. So, all those things are actively being done now and soon to be -- move forward on that.

In terms of ostarine, that's completely independent, and mainly because of what's -- what we anticipate will happen with the ACAPODENE partnership. So, it gives us some flexibility in terms of what we want to do with ostarine. And, if we don't want to partner, we won't partner. If we want to partner we'll partner. But, what will determine whether we partner or not is what the deal looks like for our shareholders and how can we maximize that. So, it puts -- so, the reason I brought it up that way was to say one, there is a lot of interest in ostarine right now. And, it's amazing what happens when you go from a Phase I to a Phase II program.

And, the other thing interesting Eric, that has happened over the last -- I would say the last year to two years is that a lot of these large pharmaceutical companies have woken up to the fact that the only way they're going to differentiate themselves in these large markets like osteoporosis and frailty is to have a drug that not only deals with osteoporosis, but also deals with muscle. So, if you do a ligature search, you'll see there's intense discussion in these large pharmaceuticals and scientists that building muscle is going to be the next way of the future. And so, it's amazing. Once they've decided that's what they want to go after, the -- and now with ostarine being able to potentially fill both the bone gap and the muscle gap, there's a lot of attention.

So, what do you do when you start getting non-solicited calls from large pharmaceutical companies to start the discussions? And, we've been doing this now for the last year and more intensely over the last six months. But, management's goal is to hold on to ostarine and maximize its value, but at the same time, recognize these large indications that we have to go into. It's not -- and we just can't do it ourselves. So eventually, we're going to have to partner. So if today, a deal comes to us that will maximize the value of ostarine at the SARMs, then it only makes sense that management would have to move forward.

Okay, thanks for the clarification.

My pleasure.

And, your next question will come from the line of Gene Mack from HSBC. Please proceed.

Hi, Mitch. Thanks for taking the question. I've just got a couple of questions on ostarine and then one follow-up on ACAPODENE.

Sure.

As far as the timing on ostarine goes, I wonder if there was just a bit of a subtle shift in that we're not expecting the trials to start up at the beginning of next year, probably some time in the first half, but is there some -- is there some likelihood that we'll understand what the goal is in terms of regulatory and trials prior to the end of the year?

Yes. I'll tell you what our goal is. Our goal is -- and as we speak now, we're doing this is, we're beginning to lay the groundwork of what indications we want to go into. And, our group is doing the market research. They're doing the scientific research. We're discussing [inaudible] opinion leaders. And, as part of that homework assignment, we're also beginning to understand what the regulatory pathway will be. Our goal would be -- might be by the time we announce the ostarine data in fourth quarter this year, that we will have clarity of all those points so that when we announce the data, we will be able to give you a better sense.

So, you won't to wait until the first half of '07 to get clarity on which indications we're going into. It's just that we want to use this time now to make sure that, even though we already have a good feel for what we think we want to do clinically, even though the key opinion leaders what they think we want to do, we all know that we have to make sure that you've got a clear regulatory path as well. That's going to impact our decision.

And then, as far as partnering and having those discussions, is this a situation where once you have the data, you're already more or less engaged with broad pharma, and once you have the data, it's just sort of you just package it off to them and then, kind of wait back for what they have to say about it? Is that --?

No. No not at all. The beauty is that we've been able to manage and run these trials ourselves. We -- these trials are running independent of our discussions with large pharmaceutical companies. Your question is basically saying, do you have somebody ready to sign a deal? But, I just want to see the Phase II data.

Well no, not necessarily. I'm more -- I think we might be in line. I'm just wondering, how do you --.

I mean --.

What the next step is?

Yes. I would say the flip way around. Let's say that we have -- if the Phase II data comes in like our multiple ascending dose data came in in our Phase I that we did in elderly men then we're going to have a real basis for some serious discussions about the value of this opportunity. And, we feel that where you have the most value in this asset is going to be when you've got human data and you can look at the potential partnership and say, "Okay, let's do a confirmatory Phase III, or let's do a Phase II/b in this new disease state."

But at least, we've got data in hand. So, that's kind of -- that's more the angle than it is -- let me say it a different way also. We are definitely in discussions. And as you would imagine, with a large pharmaceutical company, if this data was available, you'd want it. But, that's not what's dictating the level of discussions or the timing of discussions, if that makes sense.

Okay. Can you review what you know about the dosing right now of ostarine and how much more -- or do -- is there a possibility for more work to have to be done on dosing following the results of the Phase II?

The answer is that, we have chosen -- we've taken a different route, to day it a different way. We have decided in our Phase II to try to collect comprehensive data. And what that means is that we're spending the time and the money in going after the patients, both males and females, so that this Phase II becomes really a dose-finding Phase II so that we will be able to get that kind of information. In the Phase I multiple-ascending dose study, we also had a dose range. So, I will tell you the Phase II study has a different -- has an overlapping dose range.

So what that means is, we're already getting more and more clarity about what that dose is going to look like in males and females. We do believe that the dose in females may be different than the dose in males. And, that's why we included females. So, I'm hoping that the end of Phase II, that most of the dose work will be done, and it's just a matter of going into a Phase II/b or III. It may be in a Phase II/b or III, there will two arms dosing versus a placebo, but again, I just don't know what the regulatory agency is going to require.

Okay, great. And then just finally, on the ADT safety extension, can you just clarify -- I guess assuming you file for the indication in the first half of 2008, at that point in time, can you maybe project what sort of patient years exposure you might have to -- or at least, patient numbers and then duration of time that they've been on drug by that point?

Well, let me take a step back and remind you that toremifene citrate, which is the drug that is being tested in these patients has over 450,000 patient years use. So --.

Right. That's in females, right?

Well, and there's some males in that database because males get breast cancer too.

Okay.

I will also add that we do have a Drug Safety Monitoring Board that is following these patients out. We have had patients exposed to toremifene in our Phase II/b and that was 5 to 14 patients. You just have to subtract out the placebos. And then, you have the Phase II/b -- excuse me, Phase III PIN study that's using the 20 mg of this, and that's going to be a three-year study. And, you're going to have three years of data for safety. And the [avecuse] I mentioned before is going to be before that at 281 [inaudible].

The ADT trial after the extension trial, certainly during the review period, all of that would be done. You're going to have three years roughly, 1,400 patients again minus the placebos. And then on top of that, you're going to have additional data that's already out there to men in the literature in which they were trying to use toremifene citrate as high as 640 mg frequently and with advance prostate cancer. And, that was a work that was published out of Pennsylvania at University of Pennsylvania. So, there's a lot of literature of safety, drug safety, Monitoring Board information, pharmaco vigilance databases, [Morian], which is the company that we licensed the drug from, our own database, and then on top of that, these clinical trials. So, I think it's going to be a lot of safety because it's a point of being ready to file and hopefully after we file the label.

Okay, great. Thanks.

And, our next question will come from the line of Matthew Jacobson from BDR Research. Please proceed.

Hi, thanks for taking my question. I was wondering if you could just give us an update on andarine, when you think that's going to move forward and whether at this point, you're just waiting to see the ostarine data actually first, whether that makes the most sense or whether andarine is still going along?

Yes, thank you for the question. The question is about andarine. Andarine, as you know, was our lead compound. And, we licensed andarine to Johnson & Johnson in March of 2004. And during that period of time, J&J was interested in andarine and they were interested in back-ups. But, that meant that we were able to retain the rest of the SARM program with which ostarine came out. So, ostarine began moving in a parallel path with andarine in some respects from a pre-clinical standpoint. And then for clinical standpoint, we continue to move it forward. For whatever reason, we were able to move ostarine incredibly fast to a point that ostarine is 18 months to two years ahead of andarine. And, we're getting data from ostarine that clearly positions ostarine as our lead program in SARM.

So whether andarine is in there, whether J&J is in there, it doesn't matter. For all the SARMs and all pharmaceutical companies out there working on SARMs, which all the major ones are, we've been able to advance ahead of all of it. So really, the attention is on ostarine right now. What will happen with andarine? I do not know. All I can tell you is, we're working with our partner Johnson & Johnson. We certainly play a role in the Joint Development Committee. But with ostarine, we have full control, and that's the one that we've been moving forward. And, that's the one we're going to see data here in the fourth quarter.

So, is it essentially J&J's decision then, whether or not to move andarine forward? Or, is it a joint --?

I don't know if it's a decision or a -- it's process. Do you know what I'm saying?

Sure.

It's a -- I think it's more of a process.

Right.

It's just you've got a small new biotech company. It's not that we make quick decisions. We make decisions quicker.

Sure. Also on the PIN urine test, I thought that the macro rate data seemed interesting. I was wondering what the timeline is for a diagnostic program like this, just broadly?

Sure. I'll be able to tell you broadly. I won't be able to tell you specifically.

Sure.

Broadly what that means is, typically when you're at a polyclonal antibody stage, that means you've made antibodies -- different antibodies for the same epitope, so it's another way of saying, you'd love to have one antibody that goes after a single epitope. But, you've got to start somewhere. So, they're at the polyclonal spot, and they'll move to the monoclonal spot. And, then when they have a monoclonal aliza, then it's much easier from a mass production standpoint to make a test.

Sure.

Typically, that takes six months. And then after that, you now have a monoclonal antibody aliza test, and then roughly you can expect something like a year to 18 months at that point. And again, that's generally what happens if we had an aliza monoclonal antibody test. And as you know, those kinds of tests are easily adaptable to many of the machines that people have in their laboratory.

Sure.

In their office or whether essential laboratory. To me, the key pieces of this are going to be the commercialization, making sure that you've -- that there's the -- a lot of these diagnostic companies are wonderful at picking out markers. They're wonderful at putting together the preliminary information. But then, you have your other companies that all they are are commercialization, marketing distribution arms. And so, it's really a marriage between those two. Now, we do have some partners for example like Gen-Probe and Beckman-Coulter who have clearly made a name in this space and take it from A to Z.

Then, we have other partners that are more in the discovery/research side that are going to need to partner this or really partner this to keep this thing to go -- keep this thing forward. Our job is just to supply to both types of companies and hoping that, with and exciting test, the commercialization part will work its way out.

Great. Thanks, Mitch.

Sure.

And, our next question will come from the line of Aaron Reames from A.G. Edwards. Please proceed.

Thank you for taking my questions. Most of them have already been asked, but I wanted to get a little clarification on the plans for ostarine since there seems to be somewhat of a mild shift. Are you planning on potentially entering into the relationship with a partner prior to having those discussions with the agency or prior to making the determination what indications to move into initially, just because of the resources that might be provided by the partnership and potentially their desire to be involved in that process? Or, could you expand on that a little bit?

Sure. Let me begin by saying, there's no shift. This has been our plan all along, and this is what we've announced all along.

Okay.

And just to take -- just to tell you what I mean, and I appreciate the question, is that all along, we have been in discussions with large pharmaceutical companies. My point today was only to tell you that the interest in ostarine has intensified, which means of course that we're going to be balancing a lot more balls. It is an independent discussion, in my opinion, which indication we go into as a company. And how ostarine moves on the development side is, at this point, independent of our discussions. Now, if a -- if along the way, the discussions are consummated into a deal, then obviously, we're going to be sensitive to our partners and what our partners' needs are. But at this point now, we're positioning GTx as if we were going at it alone.

And what we've told people is we want to have an acute indication. The beauty of an acute indication, Aaron, is that it's something GTx can take by itself and have access to the markets. And the chronic indications, in all fairness, is going -- you're going to need a partner. So the question is, how can you get as much information to gain as -- which basically maximizes the asset so if you do a deal, you can do a deal that is favorable for GTx. And, if it's favorable for GTx, it's favorable for our shareholders. So, there has not been a shift, nor has there been a signal that we're going to wait or speed up or slow down discussions based on clinical developments. So, they're really parallel paths. They're independent paths. Can they cross at some point? Sure. But at this point, that's not happening.

Okay. And then I guess on the ACAPODENE partnership on where, I guess just thinking about it from a modeling perspective, are -- is the preference for management to see more on the up-front side? Or, I guess more on the back end? And I guess, where do you apply your value, I guess when you're thinking about partnerships?

Not much, again talking hypothetically, I will tell you that we want both an up-front and we want the back end. So -- and, we think that's possible with a Phase III asset.

Okay. Okay, and then just the last question, I was wondering if you could provide us just with a little more color about the reductions in lipid levels, I guess by providing a little more insight as to what happens with this patient population as far as the changes that occur with their lipid levels as they start on androgen deprivation therapy? So I guess, what is -- this magnitude of reduction, how significant is that?

Yes, it's a great question. And the answer is that, for the first observation we saw is that patients on ADT will have -- will have cholesterol-lowering effects from the ADT. And, this is one of the reasons they believe is leading to the higher cardiovascular mortality when you age match it with men not on ADT, and so clearly, there appears to be a relationship between cholesterol and cardiovascular death. And, it's not surprising. So ADT is one of those things that will change a lipid profile and is putting the patient at risk. So, the next question is, well how many of these patients are in fact, on something for their cholesterol? Okay?

And, you would think 100%. And the answer is, probably about half. So, that means 50% of patients that have their cholesterol out of whack are not on anything now. Is that because they're 77? And on average, remember that's average. So, it means you're going to have 50% of patients who are under that age and 50% of patients over that age because they have cancer. So, that's probably unfair because if they're surviving 10 years to 15 years and cardiovascular death is getting them, they're going to have to re-evaluate that model.

So, what we've found with ACAPODENE, the patients who have benefited the most with a magnitude that was pretty substantial were patients that were not on statins. For patients on statins, they still had a benefit, not as a much, but still had a benefit. So, that's -- that was sort of an interesting finding too. Part of that's because I believe it's toremifene is to -- it must be a benefit, meaning that it lowered cholesterol. So whether it would have a cardiovascular benefit, I can't make that conclusion. But, I can tell you that it lowered cholesterol even more so in patients on statins compared to patients on statins, not on toremifene. So -- and that may be because of different mechanisms.

So, we're going to be able to explore this more and sort of slice and dice this patient population and find out which patients are benefiting the most from this drug. I think the take-home message is, if half your patients are not taking anything, and half of these patients that don't to be sitting with four or five different pills for the side effects of androgen deprivation therapy, and you have a table that's oral that will have a cholesterol benefit, when I say cholesterol benefit, will lower cholesterol, take care of the bones, take care of the hot flashes, deal with the breast tenderness of gynecomastia, that would be a very good drug to have in cancer supportive care for ADT.

All right, thank you.

And, we have a follow-up question coming from the line of Meg Malloy from Goldman Sachs. Please proceed.

Thanks, very much. Mitch, just to -- on the cardiovascular benefit, was that pre-specified as a secondary end point along with the other ones that you mentioned.

Yes. So, make sure that I'm clear. The cardiovascular benefit was not. Lipid analysis was.

Okay

So -- and that was sort of one, I think it was Eric's question, whether we're capping cardiovascular information. The answer is, yes, but in the form of AEs and SAEs. But, as a secondary end point, lipid analysis, lipid profile is clearly -- let me say it in a different way. Lipid analysis and lipid profiles are clearly a pre-specified secondary end point.

Great, thanks very much.

Thank you, Meg.

Thank you. And, we will now have final remarks coming from Mr. -- Dr. Steiner. Please proceed.

So Dr. Steiner say, thank you operator. We would like to thank you all for your interest in GTx, and we look forward to providing you with updates on our future progress. Thank you again for joining us today on our call.

Thank you, ladies and gentlemen for your participation in today's conference. You may now disconnect. Have a good day.