Oruka Therapeutics Inc (ORKA) 2005 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to Nuvelo’s Third Quarter 2005 Financial Results Conference Call. My name is Angela and I will be your coordinator for today.

At this time, all participants are in a listen-only mode. We will be conducting a question-and-answer session towards the end of this conference. [OPERATOR INSTRUCTIONS]. As a reminder, this conference is being recorded for replay purposes.

I would like to introduce the presenters for today’s call. They are Dr. Ted W. Love, CEO and Chairman; Gary Titus, Vice President of Finance and Chief Accounting Officer; Dr. Michael Levy, Senior Vice President of Research & Development. Also on the call to participate in the question-and-answer session is Lee Bendekgey, Senior Vice President, CFO, and General Counsel.

Before we begin, the Company has asked me to read the following statement. Today’s presentation by Nuvelo management on this conference call will include statements regarding our anticipated use of cash in the fiscal year 2005, our success in accessing the committed equity financing facility that we entered into this quarter, the timing and progress of Nuvelo’s clinical stage and internal research programs, the potential markets for our clinical stage compound, and the expenses, revenues, and potential of profit from sales of any drug products resulting from such programs, which statements are hereby identified as “forward-looking statements” for purpose of the safe harbor providing by the Private Securities Legislation (ph) Reform Act of 1995.

Such statements are based on our management’s current expectations and involve risks and uncertainties. Actual results and performance could differ materially from those projected in the forward-looking statements as a result of many factors, including, without limitation, uncertainties relating to drug discovery; clinical development processes; enrollment rates for patients in our clinical trials; changes in relationships with the strategic partners and dependence upon strategic partners for the performance of critical activities under collaborative agreements; SEC review of registration statements that we will file to authorize public offerings of our securities; stock market conditions; the impact of competitive products and technological changes; uncertainties relating to patent protection and uncertainties relating to our ability to obtain funding.

These and other factors are identified and described in more detail in Nuvelo’s filings with the SEC, including, without limitation, Nuvelo’s recent Annual Report on Form 10-K for the year ended December 31, 2004 and subsequent filings. We disclaim any intent or obligation to update these forward-looking statements.

I would now like to turn the call over to Dr. Ted W. Love, CEO and Chairman of Nuvelo. Please proceed, Sir.

Thank you all for joining us this afternoon. On today’s call we are pleased to share with you the progress we have made and our accomplishments over the third quarter. Gary will walk you through our third quarter financial results, Michael will discuss the progress we’ve made in our clinical programs, and I will conclude with an overview of the milestones that we are working to achieve over the coming months.

Our mission at Nuvelo is to build a valuable business through the discovery, development, and commercialization of life-improving therapies for human disease. This year we pledged to accomplish several important goals to advance our business. I am pleased to say that we’ve made important progress in achieving every goal we set out to accomplish this year.

Let me take you through our most recent achievements. We continue to advance important product opportunities and our clinical programs are on track. So far this year, we’ve made significant progress in our Phase 3 clinical development programs for alfimeprase for both acute peripheral arterial occlusion, or PAO, and catheter occlusion.

This past quarter we achieved our milestone of initiating our first Phase 3 trial in catheter occlusion, SONOMA-2, and enrollment continues to accelerate in our first Phase 3 trial in acute PAO, NAPA-2. We also made progress with the remainder of our clinical pipeline in the third quarter. We started a proof of concept study to evaluate the potential of rNAPc2 to replace heparin in patients being treated for acute coronary syndrome, or ACS. We demonstrated our commitment to a disciplined and focused approach to clinical development and discontinued the development of ARC183.

As alfimeprase continues to make progress in Phase 3 trials and we move close to commercialization, we have begun to lay the foundation for our commercial organization and capability. Our goal, simply stated, is to build a world-class company. As part of this effort, we are making considerable progress on pre-launch and market development plans and have done a lot of work in terms of modeling opportunities for alfimeprase beyond acute PAO and catheter occlusion.

Now, I will turn the call over to Gary Titus, our Vice President of Finance and Chief Accounting Officer, to discuss the specifics of our third quarter financial results.

Thanks, Ted. Good afternoon everyone. At this time I would like to discuss our financial results for the third quarter of 2005. I would like to begin by touching on our cash balance and cash burn rate. We began the third quarter with approximately $91.9 million and ended the quarter with $75.6 million in cash and investment balances. Our cash burn was $16.5 million for the third quarter and $45.2 million for the year-to-date. We define “cash burn,” a non-GAAP financial measure, as the net decrease in cash and cash equivalents, as determined in accordance with GAAP, excluding the effects of sales, maturities, and purchases of short-term investments, changes in restricted cash, and net proceeds from equity or debt financing activities, all being determined in accordance with GAAP. Our operating expenses were $19 million for the third quarter of 2005 and $51.5 million for the year-to-date. We spent $14.8 million on research and development during the third quarter of 2005 and $40.3 million for the year-to-date, as compared to $7.7 million and $31.8 million for the same periods last year.

As you may recall, in the first quarter of last year, we incurred combined one-time license and collaboration fees of $7 million related to our rNAPc2 and ARC183 drug candidates, which significantly increased R&D expenses last year. Excluding these one-time fees and the $5 million Amgen milestone payment in the second quarter of this year, during the first nine months of 2005, we increased our R&D expenses by $10.5 million or 42% as compared to the first nine months of 2004.

Looking at our last two quarters sequentially, our third quarter R&D expenditures increased by $5.3 million or 56% as compared to the second quarter of this year, excluding the Amgen milestone. This increase was primarily a result of growth in our clinical development activities.

In the third quarter of this year, we have incurred $22.7 million in expenses associated with our Phase 3 clinical programs for our lead product candidate alfimeprase. This represents more than half of our total R&D spending this year.

Our general and administrative expenses increased to $4.2 million in the third quarter of 2005 and $11.1 million for the year-to-date, as compared to $2.6 million and $6.2 million in the same periods last year. The change was a result of increased expenses associated with building our infrastructure to support our growing development organization and preparations for the planned commercial launch of alfimeprase.

Turning now to our consolidated statement of operations results, for the three months ended September 30, 2005, we reported a net loss of $18.5 million or $0.44 per share compared to a net loss of $10.9 million or $0.34 per share for the same period in 2004. Our year-to-date loss was $50.1 million or $1.23 per share compared to a net loss of $39.5 million or $1.30 per share for the same period in 2004.

The number of shares of common stock used for the calculation of third quarter earnings per share is based upon weighted average shares outstanding during the quarterly and year-to-date periods. For the third quarter this was 42.2 million shares and 32 million shares in the same period in 2004. For the year-to-date this was 40.7 million shares and 30.4 million shares in the same period in 2004. On September 30, 2005, there were 42.3 million shares outstanding.

Between the cash on hand, the ability to access up to $75 million from our Committed Equity Financing Facilities, and our $100 million shelf registration statement, Nuvelo continues to be in a strong financial position.

I’ll now turn the call over to Dr. Michael Levy, Senior Vice President of Research and Development.

Thank you, Gary. For the next few minutes I’ll provide you with an update on R&D pipeline and share with you our excitement for the progress we’ve made in all our programs.

Let’s begin with an update on alfimeprase, our lead product candidate. We are pleased to announce that the clinical data from our Phase 1 trial of alfimeprase in patients with chronic peripheral arterial occlusion was published in the August issue of the Journal of Vascular and Interventional Radiology. This is the first peer reviewed publication of alfimeprase clinical data, and we look forward to additional publications and presentations in the future.

Turning now to our Phase 3 program with alfimeprase, let’s start with acute PAO, also known as the NAPA program. We continue to make significant progress in the NAPA program as a whole. For the NAPA-2 trial, our first alfimeprase Phase 3 trial in acute PAO, we’ve opened 30 new sites and entered 5 new countries in the last quarter, and today have more than 90 sites activated. And I can tell you that patient enrollment is going well. It’s ramping to plan and is on track. As we gain momentum in this trial, we expect to have sufficient enrollment experience to be able to provide an estimated timeline for completion of the NAPA-2 trial at our year-end 2005 results call.

For the second Phase 3 trial in this program, NAPA-3, we are making significant progress identifying and signing up sites and are focused on enrolling the first patient in this trial before the end of the year.

Let’s turn now to catheter occlusion, our second development program for alfimeprase, also known as the SONOMA program. We’re pleased to announce that last quarter we achieved our milestone of initiating the first catheter occlusion trial, SONOMA-2. In September, we enrolled the first patient in this randomized double-blind trial, which is comparing 3 mg of alfimeprase versus placebo in 300 patients with occluded central venous catheters.

The subjects are randomized 2-to-1, so that two-thirds will receive alfimeprase. The study’s primary endpoint is restoration of function to occluded catheters at 15 minutes. We’re making significant progress with this trial and are on track to have a majority of the planned 40 centers activated by year end.

We also have a second trial on catheter occlusion, SONOMA-3. This trial will be an open-label, single-arm trial evaluating alfimeprase in 800 patients. This study’s primary endpoint is safety, and we will be evaluating efficacy in these patients as well. We’re on track to initiate SONOMA-3 in the first half of next year.

Now, let’s turn to rNAPc2. We’ve made great progress with this program this year. In May, we completed a Phase 2a trial evaluating the safety of rNAPc2 in patients with acute coronary syndrome, or ACS, and data from this trial will be presented at the upcoming American Heart Association meeting in Dallas this month.

In August, we began a Phase 2 heparin replacement study, which should give us a good indication of rNAPc2’s anticoagulation activity and its potential ability to replace heparin in patients with ACS. The heparin replacement study is an open-label study that is evaluating efficacy and safety of rNAPc2 by reducing the dose of heparin and also ultimately replacing it in patients being treated for ACS.

The study will include 50 to 100 patients and is being conducted with the TIMI Study Group. The trial is going well and we expect to complete it in the first half of next year. We are committed to developing rNAPc2 because we believe its novel mechanism of action offers the potential to help patients with ACS and suggests that it may have therapeutic utility in a variety of other indications.

Let’s now discuss our thrombin inhibitor program, which is in collaboration with Archemix. Let me first remind you that the rationale for this program is to identify a compound that is able to provide rapid onset and offset of anticoagulation in patients undergoing acute interventional procedures. In September, we closed a Phase 1 trial for ARC183, our first clinical candidate in this program. We were able to demonstrate that ARC183 could achieve rapid onset and reversal of anticoagulation, but the amount of drug needed to achieve the desired anticoagulation for use in acute procedures such as coronary artery bypass graft surgery resulted in a suboptimal dosing profile.

We were encouraged by the preliminary data from the Phase 1 ARC183 program and are now applying this to the identification and development of a more potent product candidate that meets the high standards we assessed. In collaboration with Archemix, we are now investigating a number of molecules that could offer a more optimized product profile. Both companies are excited about the program, and we look forward to sharing progress with you.

Finally, I’d like to discuss NU206, which has great potential as a supportive therapy for cancer and in the treatment for a variety of other gastrointestinal conditions. NU206 is the first preclinical compound to advance into IND-enabling studies from our own internal research efforts, and research to date indicates that NU206 acts as a specific and potent stimulant of the growth of gastrointestinal epithelial cells and has shown potential in animal models for the treatment of chemotherapy and radiation therapy-induced gastrointestinal mucositis as well as inflammatory bowel disease.

In August, preclinical date on NU206 was published in the prestigious Journal of Science. These data generated a great deal of excitement in the scientific community and we look forward to sharing more data on NU206 in additional publications in the future. The NU206 program is progressing well and we continue to advance preclinical studies with a goal of filing an IND in mid-2006.

I’ll now turn the call back over to Ted.

Thank you, Michael. As you’ve all heard, we are making tremendous progress in our preclinical and clinical programs. Let me close by taking a moment to reiterate upcoming key milestones.

We expect to have sufficient enrollment experience that will allow us to provide an estimated timeline for completion of the first Phase 3 acute PAO trial, NAPA-2, on our year-end 2005 results call, and we are focused on initiating the second trial, NAPA-3, before the end of the year. We expect to begin enrollment in our second Phase 3 catheter occlusion trial, SONOMA-3, in the first half of next year. Also, in the first half of next year, we expect to complete the Phase 2 heparin replacement trial with rNAPc2 in patients being treated for ACS. Finally, we are targeting the middle of next year to file an IND for NU206.

In closing, we have continued to make execution of our milestone a priority and will continue to do so as we approach the year end and head into 2006. We look forward to reporting our progress on our year-end call.

Operator, can you please poll for questions?

[OPERATOR INSTRUCTIONS]. Our first question will come from the line of Tariq Kassum with CIBC. Please proceed.

Oh, hi. It’s Tariq Kassum with CIBC. How are you guys doing? Just a quick question -- I wanted to get a bit more color on the NAPA-2 enrollment just generally, first of all, and then also specifically whether so far you’ve noticed any challenges in enrollment based on the lack of a registered thrombolytic in the placebo arm. I just wanted to get a bit more color on that. Thanks.

Well, Michael is really the one to answer, but I can just say at the top that I think we anticipated all the major issues and have actually been out in front of them, but to really provide some color, Michael, would you?

Sure. Thanks for the question. Actually, we’re delighted with the way enrollment for NAPA-2 has progressed to date. As we mentioned during the call, we’ve made significant progress during the year, and, in particular, we’ve made real progress over the past quarter since our last earnings call. We’ve opened up the trial now in 30 additional sites around the world, so we have over 90 sites activated. We’ve added five more countries to participating in this trial and enrollment is going well, and our plan was to have sufficient enrollment experience under our belt so that we would be able to answer the real question I’m sure you have for us, which is when the trial will complete, by our year-end call. So that’s all going very well.

We’re getting great enthusiasm from the potential investigators. As you intimate, there is no currently indicated thrombolytic for acute PAO available, so people are generally excited and happy to participate in a trial that will bring such a product, especially an exciting product like alfimeprase, to the market as quickly as possible.

I’ll just add one other thing to that, because I think everything Michael said is perfectly correct. The other point I’ll just make is that in a practical sense operating on a person in less than four hours for acute PAO, particularly a patient that’s already had symptoms for up to two weeks, really isn’t practically either doable or terribly necessary, and one of the beautiful things about alfimeprase is the rapidity with which it opens vessels; so, in fact, the complexity of the true burden of waiting a simple four hours before administering in a surgery that was already planned really is not a concern.

Okay, that’s great. Thank you very much.

Your next question will come from the line of Jennifer Chao with Deutsche Bank. Please proceed.

Hey, everyone. Thanks for taking this call. I just had a couple of questions, and I apologize. I just joined the call a little bit late, so if you’ve gone through some of this. Just in terms of realizing that you’re going to give us an update on the timing around results in the fourth quarter, I’m wondering, Ted, can you give us some sense of the proportion of patients that have been enrolled into the first Phase 3 study? I mean just some-- just so we can understand to what extent there has been progress. Maybe, put another way, is it still realistic or viable that we could see top-line results in the second half of ’06 at your current run rate?

And then the second question is with respect to the second trial being planned, what would that do in terms of depleting patients from being enrolled from the first study? Is that going to be competitive in any way? What are you going to do to try to make sure that doesn’t happen, and differences in trial design between the two studies?

Okay, quite a few questions there, and really Michael’s probably the right one to answer most of them, but I’ll just say that at a top level one of the things that we want to avoid is too much specifics because it’s not really good information about play-by-play of enrollment. What we’ve really tried to do is focus people on the fact that these were big efforts, multinational efforts, and the first priority is to actually get the sites initiated, get drugs to those sites, get sites identified, get through IRB approvals, that’s really the first step, the first hurdle. We have done extraordinarily well at that step.

In terms of those sites actually enrolling patients, all of that has actually also gone according to plan. One of the things that we really want to avoid is giving information until we really have experience to make good and solid projections, and we really won’t be there until the call that -- our next call, which will be the end of the year call. But maybe Michael can elaborate a little bit more on some of the specifics of what we’ve done in terms of trying to make all of these things go as well as possible and as fast as possible.

Okay. Thanks, Ted, and thanks, Jennifer. Let me begin just by echoing Ted’s comments that we are in fact very pleased with the way the first trial is rolling out, and we think we’re in very good shape and progressing according to plan.

You asked specifically about whether we’re concerned about depleting patients when we open up the second Phase 3 trial. And the answer is of course we’re mindful of that, but we think we have a plan in place and we’re currently recruiting centers for that second Phase 3 trial, and the initial centers that we use will be centers that aren’t currently participating in the ongoing trial. So our plan will be to march forward with new centers and, in fact, some new countries for the second Phase 3 trial, and then as the original trial ramps down over a period of time, we’ll take the best centers from that trial and add them to the ongoing trial to expedite that even further.

In terms of trial design, the second trial will in fact be very similar to the first trial, similar number of patients for a total of up to 700 patients in total between the two trials, and looking at similar endpoints. In particular, the primary endpoint will be that proportion of patients who manage to avoid surgery at the 30-day period. Both trials are similar in design insofar as they’re 1-to-1 randomizations versus active drug and placebo.

Great, and just a quick follow-up. So with respect to then the trial design, now in the first Phase 3 you had a 1-to-1 randomization, and I remember we had had some discussion around whether or not that was going to be challenging with respect to patient enrollment. I’m wondering if based on your experiences with the first Phase 3 whether or not you wouldn’t consider a 1-to-2 randomization or a variation on theme?

And then also just, again, kind of going back, Ted, to my initial question, certainly I understand you don’t want to provide specifics around patient enrollment, but it’s just been a couple of quarters since we’ve actually had any real progress on that side to track. Can you just maybe give us a sense, have things proven more challenging than we initially expected, more or less so? Any qualitative things you can share with us?

I will just share. I’ve done a lot of trials over my career. They’re always difficult and they’re always challenging, but this one has really gone according to plan. But there were challenges. I think we’ve marched through them very deliberately and taken them on. I mean one challenge is to get the number of sites up around the world. These protocols are being done in different languages. We’re dealing with physicians in different languages across the world. We’ve done extraordinarily well with those challenges. But I think to be fair, those are hard things to do, but we are reporting that we’ve got 90 sites up, which is a Herculean effort. We really just started with those toward the end of the first quarter of this year.

So I think we’ve made a lot of progress and, in fact, just to reiterate, we’re very happy with where we are. We’re not at a point where we can give you what you really want to know, which is when this trial will be done, but we’re getting very close to getting to that point.

Okay, and then anything on the randomization or the trial design on the second Phase 3 that you would do as a result of the experience?

Yeah. We don’t think that the randomization balance has been an issue for us. I mean I think that’s the short answer. And if we were to do an imbalanced randomization, what we’d basically be doing is lowering the power to see a difference and we’d be increasing the risk of the trial. And at least I don’t think we felt that -- that the problem of enrolling due to the placebo arm has been sufficient to even warrant that discussion at this stage.

Okay.

I would completely concur with that. I mean as Ted says, enrollment is going well. And initially we were concerned that having to put patients on a placebo arm might be problematic, but, in fact, we’ve had a very positive experience. This trial is going well and we see no reason to change strategy for the next trial, which we also anticipate will go very well.

Okay. Great. Thanks for the color.

Your next question will come from the line of Maged Shenouda with UBS. Please proceed.

Sure. Hi. Thanks for taking my question. I just have two questions. You mentioned that you have 90 sites up and running for the PAO trial. How many sites do you plan to have up and running in total for the first trial?

Well, for the first trial, we’ve planned on having 100 sites up and rolling. So we’re essentially there. I mean, as you probably know, what happens with these large trials is that from time to time we might find other sites which we think are good sites, which we’ll probably go ahead and add in, but we may also have sites which are disappointing in that they don’t enroll as quickly as we would like and we’ll drop those out. So we’re pretty close to what we would consider a steady state right now.

And it would be a similar number of sites planned for the second trial?

That’s our goal.

Okay. Great. And then the second question is can you just update us on your current thoughts about a partnership for alfimeprase?

Sure. Maged I’ll take that. I mean, I think the first thing I want to reiterate is how we’ve approached the whole issue of partnership, and I think we’ve approached this in fundamentally the right way. We’ve had a lot of thinking at Nuvelo about how to build our business, what is our capability, what is our competence, and where can a partnership fill in for that. And when we think about that, we feel that we’ve got a great deal of confidence in the design and conduct of these trials to get registration in the United States. We think that the way we conduct these trials will be compatible for approval, in fact, in Europe and in other countries as well. So that piece really doesn’t necessitate a partnership.

Where we felt the partnership makes a great deal of sense for us is in the commercialization of this product outside the United States. And if we have that approach, there really isn’t an absolute urgency about doing a partnership. In fact, what it tells us to do is to focus on doing an excellent partnership that’s structured in the proper way for the long-term business benefit, and that has been our approach. We have had discussions. We continue to have discussions. I have every confidence that we will announce a partnership, but we have not put a focus on timing but rather we put a focus on the right kind of partner and the right kind of deal for our shareholders.

Okay, great. And just one follow-up question if you don’t mind, can you just update us on what’s going on in the PAO space outside of thrombolytics or potentially any other thrombolytics that may be competitors to alfimeprase down the pipe?

I’ll take a stab at that, and Michael feel free to add in. You know, at the end of the day, these patients who present with an acute thrombotic event in their extremity can, in many cases, be managed with a drug that dissolves that clot. And, as you know, plasminogen activators are currently used off-label in the United States to deal with those patients.

Those drugs work, but they work with a very slow pace and require a prolonged infusion and an ICU admission and recurrent trips to the catheterization lab. And we think that alfimeprase, with a label and with a profile that could potentially mitigate the need for an ICU admission, mitigate the prolonged infusion, and obviously dramatically reduce the bleeding and other complications of plasminogen activators, would be a great advance. So we think we should be able to supplant that off-label use.

We also know that people use devices to treat these patients. Devices are almost always used in combination with plasminogen activators today. I think looking forward we would envision that people who like to use devices would likely use them in combination with alfimeprase, but in all -- in looking forward, if alfimeprase works as well as we have seen so far, it may actually reduce some of the need for using devices which are used to help plasminogen activators.

Finally, surgery is a reasonable approach and, in fact, the design of our trial is in fact to show that you can reduce the need for surgery and the attendant complications, morbidity, and mortality of surgery. So we would see ourselves coming into the market and actually reducing the need for many of the other things that are currently being used to deal with these patients.

Okay. Thank you.

[OPERATOR INSTRUCTIONS]. Your next question will come from the line of Mark Monane with Needham & Company. Please proceed, sir.

Thank you very much and thanks for taking my call. Let’s talk about alfimeprase a little bit more. In the current trial design, the Company does not have an SPA. Can you talk about the risks and benefits or your decision-making process in going forward without an SPA?

Hi, Mark. Michael Levy here. Thanks for the great question. You know, an SPA is a very interesting and I think a useful device in specific situations. The SPA was originally put into place predominantly for those situations where there wasn’t necessarily a good concurrence among industry, academia, and the regulators as to what constituted a significant finding in a clinical trial.

So, of course, the best example is in cancer clinical trials where there can often be a healthy debate whether relatively small differences in survival are truly meaningful to the patient or not. And in those kinds of situations, it makes an awful lot of sense for a company to have an SPA, which is after all a written agreement with the agency, before embarking upon a trial so that if a particular drug does show those small differences that I commented upon, there will be an approval pathway.

Now, our case is very different from that. In our case, we expect to see terrific efficacy. We expect -- our drug is being compared to placebo in our Phase 3 pivotal trials, and we expect to see the preponderance of patients avoiding surgery with alfimeprase, and we expect to see next to no patients being able to avoid surgery with placebo. So this isn’t a trivial difference that we’re looking for. In fact, this is a very marked difference, and there is good agreement with us and I think with the academic community and with the regulators, certainly, that these differences would be important.

So we have had a series of discussions over the past few years with the FDA, and we feel that we’re in good concurrence with them on what’s necessary for a regulatory approval pathway in this particular instance, but we don’t necessarily feel a compelling need to have an SPA.

That’s very helpful Michael. Can you give us some thoughts about what the a priori assumptions are for improvement associated with alfimeprase? And while you’re there, could you also help us think about other indications for alfimeprase where a clot is involved? I’m thinking of three in particular, acute MI, stroke, and pulmonary embolism.

Okay. So let me -- let me talk to you first about the power in the existing trial, because I think that’s what your first question refers to, and, in fact, we have terrific power. We have 90% power to detect a 22% difference between placebo and active drug in this first trial. So, for example, if the placebo rate were of the order of 20% and the rate with alfimeprase was 40%, we would be able to detect that. So we’re in good shape there, and we feel that the trial is more than adequately powered. In fact, the patient numbers for this trial are really all about building a reasonable sized patient safety database, because we can prove the efficacy of the drug with a relatively small trial because, of course, it’s so active.

Sure. And is that --? That’s a 22% relative difference on absolute difference, am I right?

That’s a 22% absolute difference in the rate of patients requiring open vascular surgery.

Okay. And what placebo rate are you assuming?

Well, I don’t know that we’ve disclosed that in the past, but we’re assuming a relatively low placebo rate. You know if you wanted to guesstimate something in the order of 10% or so, you would be approximately right.

Okay, so that’s spontaneous resolution of clot without it?

Yes. Now, of course, really the spontaneous resolution of clot should be close to 0%, but we tend to plan conservatively.

That’s fair. And what about places where catheter and the clot are involved? I see--

That is an exciting question, because as we think about alfimeprase as a Company, we realize that it’s a transformational technology because for the first time physicians will have at their disposal in their armamentarium a thrombolytic that’s able to dissolve clots rapidly in a number of indications, and, if our Phase 2 trial results hold out, without the safety liability of the existing agents, the plasminogen activators. And because of that, we’re pretty optimistic, especially in discussion with key opinion leaders, that there is a potential for alfimeprase to change the treatment paradigm for a number of diseases in which thrombus is the underlying path of physiology, and, of course, there are a lot of diseases that fall into that category.

Acute PAO and catheter occlusion are two that we’ve chosen for strategic reasons to look at as our first indications, but, beyond that, there are a number of very exciting indications and we’re getting a lot of pull from the physician community to get involved in those sorts of trials. For example, two that come to mind very readily are stroke, where there is a huge unmet medical need, and deep venous thrombosis, which is a very, very large indication in which there currently really are no good agents available for therapy beyond anticoagulants.

Thanks for the added insight. Congratulations on your progress.

Your next question comes from the line of Caroline Stewart with Morgan Joseph. Please proceed.

Hi. I’m going to switch gears and I’m going to ask you about rNAPc2. I guess I’m wondering for the Phase 2b ANTHEM trial kind of whether the patient population in that study will be similar to the Phase 2a. I guess mainly I’m looking at are these patients -- ? Are these patients who are planned -- ? Are they scheduled to go for invasive procedures, and, also if they are allowed the standard meds of clopidogrel and GP IIb/IIIa inhibitors?

So the short answer is that the patient populations will be quite similar. In fact, they’re both ACS patients. We are not trying to control the various concomitant medications, two that you mentioned, but for that matter any other. In the trial that we have ongoing right now, the question is actually a very simple one, and that is can the addition of rNAPc2 to the treatment regimen allow for the withdrawal of heparin?

And, ordinarily, since these patients are acute, if you withdrew the heparin, the anti-thrombotic therapy, that you would expect an exacerbation of symptoms in a high proportion of patients; and the design here would be to see if, in fact, you can withdraw it and not have exacerbation of symptoms. That would be I think a powerful, though indirect but still powerful, demonstration of efficacy in ACS.

And what happens if the patients are still ischemic? What happens? Do they just get more thrombolytic or what happens, or do they get increased dose of rNAPc2 or heparin, or how is that taken care of?

Well, I can’t and Michael may be able to remember. I think a person who is truly unstable would not be allowed into the trial. I think the patient needs to be stabilized on their regimen before they could be admitted to the trial. Otherwise, I think we’d have a problem because you’d basically take a patient in whom heparin was failing and then asking the question about replacing a failing therapy, which probably wouldn’t be a valid question. So I have not personally looked at the trial recently, but I would be quite surprised if there wasn’t a requirement that the patient be stabilized on the regimen and then we look at addition of rNAPc2 and withdrawal of heparin.

What Ted said is absolutely correct. These are relatively low-risk ACS patients we’re entering into the trial. And, of course, if a patient unexpectedly deteriorates, this is an open-label trial and the appropriate thing would be for physicians to give best-available care as per local protocol.

Okay. Thanks very much.

At this time, we will conclude the question-and-answer portion of this call. I would now like to turn the call back over to Dr. Ted Love for the closing remarks.

Thank you. I’d simply like to end by thanking all of you for joining us today, and also remind you that you’ll have several opportunities to hear more about Nuvelo this month.

Lee Bendekgey, our CFO, will be presenting at the CIBC conference in New York on November the 9th, and the Company will be hosting an event at the American Heart Association meeting in November, this month, as well. At that meeting, at AHA, we’ll be discussing the rNAPc2 Phase 2 ACS data, as well as other updates in our cardiovascular programs.

Information on these events and other events, I just want to remind you, can be found on our website. Again, I want to thank you all and wish you all a good afternoon.

Thank you for your participation in today’s conference. This concludes your presentation and you may now disconnect. Good day.