Palvella Therapeutics Inc (PVLA) 2020 Q3 法說會逐字稿

Greetings and welcome to the Pieris Pharmaceuticals' Third Quarter 2020 Earnings Conference Call. (Operator Instructions). As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host Mr. Tom Bures, Vice President of Finance. Please go ahead.

Thank you. Good morning everyone and thank you for joining us for our third quarter 2020 conference call and corporate update. On the call today, we have Steve Yoder, our President, and CEO, who will provide a corporate overview and outlook on our pipeline; Hitto Kaufmann, our Chief Scientific Officer; and Shane Olwill, our SVP, and Head of Translational Science will be available for Q&A. You can access the press release released this morning on the Investor Relations page of our website at www.pieris.com.

Before we begin, I'd like to caution that comments made during this conference call may contain forward-looking statements involving risks and uncertainties regarding the operations and future results of operations of Pieris including statements related to the timing and progress of our clinical trials and preclinical programs, our partnerships and our financial position and actual results or events may differ materially from those expressed or implied by such forward-looking statements.

Factors that might cause such differences are described in our filings with the SEC including our annual quarterly and current reports. The information being presented is only accurate as of today and Pieris undertakes no obligation to update any statements to reflect future events or circumstances.

I will now turn the call over to Steve.

Well, thank you, Tom, and thank you to everyone for joining us today for our third quarter 2020 earnings call. To begin as a brief background on Pieris, we have developed a proprietary class of next-generation therapeutic proteins called Anticalins. Anticalin proteins are engineered human lipocalins, which are proteins that are naturally abundant in the body and serve to bind and transport various molecules. As Anticalins proteins are smaller and typically more stable and engineerable than antibodies, they can offer unique advantages over other treatment options, such as inhaled delivery to treat respiratory disorders locally or the ability to create more complex bispecific formats to drive a desired biology as we are doing in immuno-oncology.

Turning to our pipeline, I first would like to give an update on our lead respiratory program PRS-060, also known as AZD1402, which is an inhaled IL-4 receptor alpha antagonist that we are developing in collaboration with AstraZeneca for the treatment of moderate to severe asthma. I'm pleased to report that preparations for a global Phase IIa study of that program are complete and that AstraZeneca has submitted the first clinical trial application for this study. Dependent upon regulatory approval both site initiation and patient screening are expected to begin this year. We anticipate the first patient will be dosed with PRS-060 in the first quarter of next year, triggering a milestone payment from AstraZeneca which we plan to formally announce.

The Phase IIa study will test a dry powder formulation in a moderate uncontrolled asthmatic population at up to 3 dose levels and will be placebo-controlled. The study will evaluate the improvement relative to the placebo of the forced expiratory volume in one second, also known as FEV1 over 4 weeks in addition to assessing the safety and the pharmacokinetics of PRS-060.

As a reminder, our Phase I studies used the nebulized formulation of this drug candidate. Since there is no clinical experience of PRS-060 as a dry powder in asthmatics, the study will also include an initial part with 4-week dosing of moderate controlled asthmatics to establish safety and pharmacokinetics before enrolling moderate asthmatics who are uncontrolled on standard of care. The study will enroll over 350 patients in up to 4 arms including one placebo arm and patient enrollment criteria include characteristics of T2 inflammation. Following the completion of Phase IIa, Pieris will have options to co-develop and subsequently to co-commercialize PRS-060 or AZD1402 in the United States alongside AstraZeneca.

We are pleased to be able to communicate AstraZeneca's commitment to the continued clinical development of this program, and we continue to consider PRS-060 as a key-value driver for Pieris given the market opportunity, the differentiation potential, and the terms of our collaboration agreement with AstraZeneca.

Apart from PRS-060 our collaboration with AstraZeneca includes 4 additional programs. And beyond the tangible progress, we have just reported with PRS-060, we also are happy to report that last quarter AstraZeneca initiated the 4th of these additional programs taking full advantage of all available potential new project starts envisioned in the collaboration. The alliance remains a highly collaborative one, and we are appreciative of AstraZeneca for being an engaged and fully committed partner.

Now in addition to our respiratory collaboration with AstraZeneca, there are a number of proprietary preclinical respiratory programs we are working on. We were hoping to be able to disclose some additional details for one of these programs this year, but due to COVID-related delays and for strategic reasons, we are now planning to reveal these details next year after generating some additional data to support a more informed initial disclosure.

And moving beyond our respiratory franchise, I would now like to give an update on our immuno-oncology programs. And our lead IO program and the key value driver in this franchise is PRS-343, our 4-1BB/HER2 bispecific that we are developing for the treatment of HER2-positive solid tumors. PRS-343 is the only HER2-targeted-adaptive immune system engager in clinical development and was specifically designed to drive 4-1BB agonism in the tumor microenvironment in HER2-positive solid tumors while avoiding unwanted peripheral toxicity. Clinical data generated with PRS-343 in each of our Phase I studies, which is a monotherapy dose-escalation study and a combination dose-escalation study with the atezolizumab provided under a drug supply agreement with Roche, they've demonstrated clinical benefit and compelling biomarker evidence in addition to demonstrating an acceptable, safety and tolerability profile of PRS-343.

We presented additional results from both studies as part of an oral presentation session at the 2020 ESMO Virtual Congress in September, showing that PRS-343 continue to demonstrate durable clinical benefit in the active dose cohorts, which includes a complete response confirmed and in heavily pre-treated patients across multiple HER2-positive tumor types.

Additionally, a significant expansion of CD8 positive T cells in the tumor microenvironment of responders and a substantial increase of soluble 4-1BB observed in the active dose cohorts collectively suggests that 4-1BB mediated target engagement is in fact driving clinical benefit. PRS-343 showed an acceptable safety profile at all doses and schedules tested in each of these studies reinforcing the rationale for the intended mode of action of the drug candidate. These newly presented data reinforce our conviction in the significant potential of PRS-343 to improve the lives of patients with few treatment options, and we look forward to bringing the program into the next phase of development in a proof-of-concept study in second-line gastric cancer in combination with ramucirumab and paclitaxel.

As previously indicated, we signed a clinical trial collaboration agreement with Eli Lilly and Company last quarter, under which Lilly will supply us with ramucirumab.

Now I will provide you with an update on the progress we have been making to remove the partial clinical hold that was placed on PRS-343 studies by the United States Food and Drug Administration in July. In its issuance of the partial hold, FDA requested Pieris to conduct robust in-use compatibility study, which is a laboratory-based study to assess the effects of dilution in any handling stress that might occur during pharmacy preparation, transport, and clinical administration of PRS-343.

As a reminder, currently enrolled patients continue to receive treatment, although no new patients can be enrolled until resolution of this partial hold and FDA did not cite any adverse events in patients as a reason for the partial hold. Today, I'm pleased to report that we have conducted and completed what we believe are the necessary studies in connection with resolving the partial hold. As part of the now completed studies, we have optimized the level of an existing excipient used during the clinical administration preparation process to enhance the stability of PRS-343 under prescribed as well as stressed conditions that could occur in preparation of PRS-343 for patient administration in the real-world setting.

We plan to submit these results to FDA today in the form of a Type A meeting request to elicit the agency's feedback on the adequacy of the stability data supporting the use of the existing excipient as a co-diluent for PRS-343 and the clinical proposal to initiate continued development of PRS-343. We are confident that we have generated a robust dataset, which will allow FDA to lift the hold after considering our forthcoming Complete Response Letter, which we expect to submit in December pending a positive Type A meeting.

As a result of this decision to formally engage FDA via a Type A meeting, we now expect to initiate Phase II study of PRS-343 in combination with ramucirumab and paclitaxel next year. Although we are not able to initiate this trial this year as originally intended, our team has worked tirelessly to provide a viable path forward, and we believe the additional agency engagement that a Type A meeting entails is appropriate in view of the substantive advice on future clinical development we expect to receive from the agency through this process and I look forward to providing an update on this matter at the appropriate time.

In complementing PRS-343, our second most advanced 4-1BB bispecific program which is PRS-344 progresses through the IND readiness stage as planned. We continue to anticipate filing an IND for this program together with Servier, our co-development partner for this program next year. PRS-344 is a 4-1BB PD-L1 bispecific where we hold U.S. rights under our alliance with Servier who holds ex-U. S. rights. Additionally, within our Servier collaboration, we intend to complete non-GLP preclinical work for the second program in our alliance PRS-352 this year before handing the program over to Servier who would be responsible for further development of the program. PRS-352 is a preclinical stage biotech -- biologic program addressing undisclosed targets for immuno-oncology.

Beyond our Servier collaboration, our Seagen collaboration also continued as planned, where Seagen continued the advancement of the first program within our alliance following the successful hand over to Seagen last quarter, which generated a USD 5 million milestone payment as previously communicated.

Now moving beyond our pipeline, I'll conclude with a few corporate updates. In the third quarter, we raised USD 9.7 million in net proceeds in an equity offering through our at the market or ATM facility. The block trade offering was with a new shareholder, Pontifax, and represents the only time we have used the facility to date. We believe this transaction provides a meaningful yet focused amount of working capital to advance the pipeline, while further strengthening our shareholder base.

And finally, I would like to mention that Ingmar Bruns, formerly Senior Vice President and Head of Clinical Development at Pieris, has moved on to pursue another opportunity. Ingmar has been an invaluable resource to me and the rest of the team during his 3 years at Pieris, and we wish him all the best in his new venture. In the interim, we have dedicated clinical development advisors to support the execution of our near-term clinical objectives, together with our accomplished clinical operations and regulatory affairs teams. These resources will provide full coverage for our drug development needs while we continue to execute on an ongoing search for accomplished senior executive drug development leadership at the company.

This concludes my prepared remarks, and I would now like to hand the call back to Tom to guide you through our third quarter 2020 financial results in more detail. Over to you, Tom?

Thanks, Steve, and good morning again everyone. Cash, cash equivalents and investments totaled $82.6 million for the quarter ended September 30, 2020 compared to a cash, cash equivalents and investment balance of $77.2 million and $104.2 million for the quarters ended June 30, 2020 and year-end December 31, 2019, respectively. The decrease since year-end was due primarily to operating cash expenses and capital as well as one-time expenditures associated with the move to a new R&D facility in Hallbergmoos, Germany in the first quarter of 2020.

Cash usage for the year-to-date period was partially offset by our third quarter 2020 cash inflows of $9.7 million in net proceeds from an ATM offering that Steve mentioned and $5 million collected for the prior achievement of the Seagen milestone.

R&D expenses were $11.8 million for the quarter ended September 30, 2020 compared to $13.2 million for the quarter ended September 30, 2019. The decrease in R&D expenses was primarily due to lower manufacturing and clinical spending on PRS-060, lower preclinical and manufacturing costs and lower travel-related expenditures due to COVID-19 restrictions. The overall decrease was partially offset by an increase in allocated IT and facility costs due to the move to the new facility, higher consulting spend and higher license costs.

G&A expenses were $4.1 million for the quarter ended September 30, 2020 compared to $4.8 million for the quarter ended September 30, 2019. The decrease in G&A expenses were due primarily to lower personnel costs, lower audit and professional fees and lower travel-related expenditures due to COVID-19 restrictions. These decreases were partially offset by higher allocated IT and facility costs due to the move to the new facility.

Net loss was $14.3 million or a $0.26 loss per share for the quarter ended September 30, 2020 compared to a net loss of $2.6 million or a $0.05 loss per share for the quarter ended September 30, 2019.

With that, I will turn the call back over to Steve.

Thanks again, Tom. In closing, I just want to reiterate our satisfaction with the recent progress we have communicated today for our pipeline during this COVID pandemic, which includes: completing the in-use studies and the construct of ongoing engagement with FDA to remove the partial hold for PRS-343 as well as the recently disclosed clinical data at ESMO; the advancement of PRS-060 by AstraZeneca; and the continued progression through the clinic of PRS-344 together with Servier.

We wouldn't be able to do this without the unfaltering dedication of the Pieris team who remains deeply committed to current and future patients for whom we are developing these valuable treatments. So thank you to our wonderful team as well as to our shareholders who are joining us on the call today. We would now like to open the call for your questions.

(Operator Instructions). Your first question comes from the line of Joseph Thome with Cowen and Company.

And congrats on the progress. First on 343, can you just give us a little bit better indication, if possible, on how specific the FDA was on kind of the information that needed to be collected and the potential outcomes of the Type A meeting? If they do give the go-ahead to start the trial, when would kind of be the earliest time frame that that Phase II could begin? And then sort of a tangential point on that, the changes that you did make or kind of the test that you did, is this specific to 343 or will this have implications for the broader pipeline?

Great. Thanks. Thanks, Joe. Thanks for joining. Thanks for the questions. I think there is actually maybe 3 questions I hear. One is you're seeking in more clarity on how clear FDA was in guiding us to the specific studies that we ultimately then conducted, how confident we are on the clarity of guidance there. Number 2 is the impact on further in timing for further clinical development. And then lastly, I think your question surrounded any potential, I'll call it, readthrough through -- from these learnings or these observations for 343 through any other parts of our pipeline at least our bispecifics pipeline.

Great, great questions. And maybe I'd say at the outset that I think Hitto can comment on the first one, and also the third one. And I would say at the outset, just to frame it, is that I think we are very fortunate to have been dealing with a very, I think, open and constructive FDA. And I'd like to think we have a very healthy and have had a very healthy amount of feedback and desire of FDA to really be helpful here. And I think we certainly, I think, have availed ourselves to that benefit. And I'll Hitto comment on that as well as in answering the differences between what we have been doing here for 343 and anything else that we may have been addressing, CMC-wise, in our pipeline including PRS-344. They are quite different.

And then in the middle, that second question, I would just say that given that we are confident, but we have a forthcoming Type A engagement with FDA, which I think will be very informative, I think it's not healthy to speculate right now given that we are in ongoing discussions. I don't think it's a good practice to comment on that beyond what we've said today in terms of timelines just given, given it's a good practice not to comment on ongoing FDA discussions and given that we will learn quite a lot from that Type A engagement in due course.

But I would think that as Hitto can provide, I think, some more meaningful feedback on the first and the third question. So Hitto, please take it away and feel free to add more color to those 2.

Thank you, Steve. Hi, this is Hitto Kaufmann, CSO of the Pieris. I am happy to comment on the first and third part of the question. So first of all on the type of FDA alignment we have so far, we did very closely work with the FDA to align on the specific study design. We have reported in the call before that the FDA asked us to do an additional study to cover in a very broad sense the events that can occur during clinical administration and handling to apply stresses to our products. And before we actually conducted the study, we've had a very detailed discussion with the FDA to ensure that what they want us to be and what we intend to do are a match. Obviously, the FDA has not seen the resulting phase for that yet, which we have just submitted. But the study design itself was very thoroughly discussed with the FDA.

On the second question regarding the specificity of what we adjusted. This is really drug-specific and it's not something that you do at this clinical stage in a broad sense for a platform because this is really about subtleties and not, I would say, a broad platform approach. So it's stage appropriate and the further you advance in clinical studies, the more you adjust and evolve for these administrations set in a very drug-specific manner.

Your next question comes from the line of Madhu Kumar with Baird.

First, I want to thank you guys for hosting an earnings call, the day after the Presidential Election. But beyond that, how are you thinking about the use of IO agents in front-line gastric cancer? And how that kind of impacts the effect of 4-1BB agonism combined with a drug like ramucirumab in the second-line setting?

Thank you, Madhu. Yes, you're welcome on the timing and I hope we are not scooping any breaking news right now. But on your question, would you mind clarifying? You mentioned a specific type of agent in front-line gastric cancer. Would you mind repeating the question? I didn't fully hear the question.

PD-1 blockade. So PD-1 blockade has shown efficacy in front-line Phase III study. So how do you think that changes the female landscape for 4-1BB agonism in -- plus ramucirumab to that second-line setting?

Right. So I can, again, tee this up and happy to then hand it over to Shane for some more detail. And I would frame it may be twofold. One is that we are really, really enthusiastic with what we see developing in the early line settings with immuno-oncology regimens including adding PD-1 blockade to standard of care in HER2-positive gastric cancer, which is also now known as the Keynote 811 registration study. And we think that that does, among other things, it shows the relevance of immunotherapy in earlier lines of therapy, but reinforces the benefit of immunotherapy in gastric cancer particularly HER2-positive gastric cancer.

And also it does through, I think, under the fundamental principles of the biology as between the PD-1 blockade in 4-1BB agonism which is what our drug candidate brings to the mix, the potential synergies there. And we actually have the examples of that in our own trials. And we have, as a great case study, a particular patient who actually showed great benefit in that particular context. So I would say we have both general excitement and we have specific details to better frame that.

But I will turn it over to Shane to not only talk about that but actually adding what is something new, which is the synergy potential with ramucirumab which bring in -- brings in that vasculature stabilization through angiogenesis disruption. And so that -- Shane, well, he's been thinking a lot about that and I know he can provide a little bit more color on that to show why we are enthusiastic of prioritizing second-line gastric adding our drug candidate on top of [man] chemo in those patients who likely would have already been experienced with a PD-1 blocker in front of -- in prior therapies. So Shane, over to you for a little bit more detail, if you will.

Yes. Thanks, Steve. So just to reiterate, and as Steve mentioned, we see the benefits observed by PD-1 blockade in early lines of gastric cancer as further validation and verification that this indication is open for immune modulation. And Steve also mentioned, we do have patients in our trial who have been checkpoint and experienced, who've come on our study and done very well. And you may remember from Citi last year, we presented our patients who had been part of that trials, Pembro and Keynote study, and they have stable disease and best outcome on that trial.

They also went on in that and have involvement in a (inaudible) combo study. Again, the best response in stable disease. And they come on for our study, and they had a partial response which was durable. So we do feel that the ability to engage and activate 4-1BB is offering something very different from standard checkpoints on inhibition. We've also demonstrated through our PD correlates that we have several patients responding to our drug who have a very low base of CD8 at baseline. So they may not -- there may be some patients who would be typically defined as co-tumor patients and they are still benefiting from our study.

As you know in our Phase I monotherapy study, we have an overall response rate of about 12% in our active dose range. And if we go to our Q2 weekly dosing, that increases and also a very healthy disease control rate. So we've got a nice monotherapy activity. As Steve said, from a scientific perspective, there's a lot of rationale for why 4-1BB agonism is going to suit a chemo (inaudible) combo. So with the chemotherapy, we anticipate that whether an agent be -- facilitate in a tumor debulking and also an antigen release spread, which will help educate T cells and make them 4-1BB pause and our agent could come in and activate.

As Steve said they were -- ramucirumab component is also very synergistic in terms of nonredundant mechanism of action with regards to vessel normalization impacting the macrophage components in the tumor microenvironment. And again just a lot facilitating an environment for our 4-1BB agonist is going to really, is going to really be beneficial. And when we think about the response rate observed with paclitaxel in second line and couple them to what we are seeing as a monotherapy in our Phase I studies, we feel that the additive, let alone the synergistic potential there is significant. And as I say we're -- we feel there is a strong clinical precedent on this field that in terms of the clinical landscape, notwithstanding the checkpoint inhibitors in first line, there's the real opportunity here first and second line.

Okay. Great. And then about PRS-60 (sic) [PRS-060], and I guess more generally, the respiratory franchise, how do you balance the idea of exploring PRS-060 in other kind of inflammatory lung indications beyond asthma versus the development of other targeted Anticalins in the respiratory space?

Yes. Thanks. Thanks, Madhu. So the way I would answer that is, one, we have a governing collaboration agreement with AstraZeneca that certainly will influence how we think about this drug candidate and how we actually develop it. This drug candidate has always been by nature of its local delivery in the lungs, a respiratory intervention and it has been based on the maturity, the maturing data sets, a Th2 or T2 endotype asthma intervention for moderate to severe asthma in the wake of all of the success dupilumab. That continues and will remain the key focus and it is still with that focus, a huge commercial opportunity that has the blessings of all these biomarkers to stratify and to assess clinical benefit going forward in a phase appropriate manner.

So I don't think we could ask for more than that in terms of the differentiation potential with the clinical in target derisking of another molecule. Beyond that, we obviously will continue to look at how things develop, particularly in the COPD field, and again as dupilumab has served as a perfect blueprint for the opportunity for a local intervention in uncontrolled moderate to severe Th2 asthma, it could potentially [solve] that, but that's something that will require further analysis. It would require further alignment with AstraZeneca.

But it's certainly something that we would look forward to watch closely and potentially pursue if things align quickly. But in the near term, we're focused on getting the proof-of-concept data for asthma in the Th2 phenotype as we announced today.

Your next question comes from the line of Jonathan Miller with Evercore ISI.

Sorry to see Ingmar leave. He was a great addition to the family. I'd want to start with PRS-060. Again, I noticed the Phase IIa is in moderate patients only, and I know that you guys were thinking about moderate and severe asthma as a potential patient population. Can you give any color on your decision, you and Astra's decision, to move forward with moderates only and what that means for the potential severe patients? And then I'd love to also hear a little bit more about the excipient change on 343. Is it fair to say that that change you made as a result of the new study was bigger than expected, given that it merits a Type A meeting and a delay to the clinical timeline?

And then third, maybe you could just remind us what we ought to be looking for in 060 as we move from a nebulized formulation to a dry powder formulation, and how we should look at that initial safety cohort, and what we should have our eyes open over there?

Sure, John. Also thanks on the 3 questions. The first and the third were 060, so I would include those together, which is a little more color on the choices the next patient population to be moderates as opposed to moderate to severe. And then also what to look for maybe from a safety perspective in the initial part of this 2-part study with 060 in the moderate-controlled patients. And then you'd ask questions around the adjustments to the excipient, which I might go back over to Hitto for that, for 343 in maybe the cost-benefit of engaging FDA through a Type A meeting.

All right. So to the 060 questions. I think at the outset, what's really important to keep in mind here is that we have with the force now [investors], I think there's a large development organization behind this program and the sense of real inevitability on patient dosing and progression. When we consider ultimately the ultimate strategy for this program, it certainly reflects a novel approach which is inhaled biologics for dry powder but it doesn't distract us from the overall BLA objective itself, which is a moderate to severe uncontrolled asthmatics. In today's announcement of the trial design near term, certainly doesn't impact I think either the strategy or the timing to achieve, to achieve that objective. The design itself then considers totality of the data. I think it also includes having that I would call measured variability that is phase appropriate for this stage. Recall that we haven't had the dry powder formulation yet in asthmatics and felt that overall, given the market opportunity number of patients and just the phase appropriateness some changes on variability as you move forward in development focusing on moderates makes a lot of sense.

And in terms of the first part of the 2-part study, I mean I think it's again not appropriate to comment in detail at this stage given that there is still submissions underway for regulatory submissions.

And I would say that I would expect that there would be forthcoming publication on clinical registries in due course and that it typically happens. I will provide more detail. And until that, I think, we can't comment in much detail. Well, I would say that these 2 parts of the Phase II study, they include a screening process, screening the lead-in process, a 4-week dosing process, and then a follow-up period. And that the part 1 study, my view is that this will be substantially smaller than the second part. But if we look, as we said, it's safety and tolerability in pharmacokinetics. So I think you'd be looking at the classic parameters there and I think that will come out as I say when the registries are published in due course consistent with AZ clinical practice.

In terms of the other that was moderates. In terms of yes, what to look for, I think I talked about that. So maybe I'll jump over to Hitto to talk about 343, then we can follow up with any other follow ups that you might want to have if I didn't fully answer your question there. And I think, just the way I'd frame it for Hitto is to say that we did make some changes, however small that they are, and we felt that overall engaging with FDA, not just to confirm sufficiency of the data, but to align on any go-forward plans overall, which is extremely valuable, but we're not talking about game-changing changes here.

So with that, maybe Hitto you can provide -- if you can provide more color that you haven't so far. Feel free to add a little more color on the nature of the excipient change.

Sure. I'm happy to. Thanks for that question because I think it allows us to clarify further. Very consciously I would talk really about an adjustment and not about excipient change. And to make that clear, the formulation of the drug in the vial was not changed by any means. The only thing we changed is, we adjusted the concentration of an existing excipients during the dilution and administration process. So again to just clarify, we did not completely remove an excipient or we did not add some novel excipient. It was just an adjustment of an excipient during the dilution process.

And maybe one way to answer your question whether this outcome was a surprise or not, obviously we went open-minded into the study and wanted to be informed and then take decisions by the data. However, that adjustment of that concentration I just mentioned was part of the initial design space of the study and it is by no means anything exotic at that stage of drug development.

Your next question comes from the line of Matt Phipps with William Blair.

On a bunch of those questions, I remember before when the clinical hold happened, you said you thought this could be just outside of the formal meeting. Now obviously having this, I guess, the adjusting the concentration of excipient seems to be what's really driving the Type A request. And then just, I mean for next steps will you gave us -- should we expect an update when you get the minutes back from the Type A meeting? Or would it be more when you disclosed that you've submitted the response letter?

Yes. Hey, thanks for the question. I think in terms of further updates, we're going to look at the response and then our view on the meeting itself and then determine what's the right approach, which we currently envision. It would be then just pretty timely to file a full complete response letter. And that's something, as I mentioned earlier, I believe that we intend to do that in December before the end of the year. And so we could envision providing an update once we are off hold. And I think given the timing of that, that would be something that would be certainly a Q1 event if things go according to plan. Early Q1, I think it's going to be according to plan. So they -- that would be the timing. So we're not going to commit to any specific additional disclosures other than I think it would make a lot of sense for us to price investors and the community once we are off hold.

Then with respect to the formalities. Look, I mean we've been operating very constructively with FDA both formally and informally, and we thought in order just to get as much bang for buck out of the communications with FDA, overall we considered these level of, however minor they are, adjustments and our plans to then resume clinical activity in the most efficient manner possible. We wanted to engage with them in this formal Type A request, which has a 30-day turnaround time, if you weren't aware. So I would think that's, overall, very justified under the circumstances.

One other question. The delay on the proprietary inhaled program, I guess, just if you could give some more details and you mentioned some COVID-related delays. You're trying to generate enough preclinical data to have available when you disclose it. I guess at what stage will this be at? Would it be ready to go into IND-enabling studies by the time you disclose it or is it still earlier than that?

Yes. So consistent I think with what we said in the past, when we have a disclosure of an envision candidate publicly it would be the desire to do more than just say here's the target name and here is the rationale. We obviously want to have attached to that a very clear value proposition as to why a local intervention would work and why it would make sense, and why it would offer a differentiated high-value opportunity with also a very comprehensive dataset that would provide a line of sight to the clinic.

Specifically, whether that would be when it's an actively an IND-enabling activities or once we have development candidate declared, I think there's some range of flexibility there. But we want to make it a meaningful disclosure, so that you can see how it fits into the pipeline more strategically. And given the COVID-related delays, which I think we alluded to the potential that's happening even in our last call, which was, we work with some selected vendors particularly for some of these more complex in vivo studies and also some complex ex-vivo studies, particularly on in vivo. There were COVID-related delays across a number of those vendors, which did impact the ability to timely conduct the studies and that's primarily what is driving some of the change in timelines today.

It's -- are working with the vendors where they're engaged. We are working through the different waves of COVID, but I feel very confident that, based on ongoing studies and ones that are planned in the near term, we are on a path to generating where we -- on a path to conducting experiments that have the potential to generate the types of data that we want in the near term.

(Operator Instructions) Your next question comes from the line of Sharon Ofer with Sphera Fund.

So I wanted to ask on PRS-060. If you can maybe give us a little more color on your expected timelines because the second part of the trial will be dependent on data from the first time. So before that enrollment can begin, just sort of what are your expectations for how long each part might take. And then, would that study design maybe allow for any COVID-related flexibility along the way like at home evaluations and anything like that?

Yes. Thanks. Thanks, Sharon. I can try to address those questions and maybe I could add a little more color than I did so far. But again, these are questions that we need to align on with answering without the -- with the approval of AstraZeneca. So I would say at the outset, we are constrained in what we can say given that we are in active submission process with agencies as part of a global study as was announced. And until that process is finalized, it's probably not appropriate to comment on the precise details of a study design. And as I mentioned, I think in due course, once things are officially approved, then there will be the opportunity to consider these points as part of the publication in trial registry is consistent with AZ's typical clinical practice.

What I can do to remind everyone on is that there are 2 parts to this study and each of which includes this, the screen and lead-in phase and then the dosing phase and then a post-dosing observation phase. And the dosing phase is 4 weeks for both studies. My expectation is that the part 1 is will be -- it is significantly smaller in terms of patient number than part 2. And so, given the fact that this is an intended global study, given that this is a 4-week duration as opposed to a, say a 12-week in-line study that would look for exacerbations as opposed to FEV1 ultimately, I think that provides fortuitously a good range of flexibility around COVID both in terms of the timing of the study itself, and the different geographies that are in play.

So I'd say stay tuned. We intend to now move with the force of AZ's development, large development organization behind it and through (inaudible) in the first dosing of the patients, triggering the milestone or through the timely publication in their clinical registry of more trial designs, you'll be able to see that then. So I hope that's sufficient to this problem we all -- that we're at liberty to say right now given that this is an AZ partnership as well as the fact that the filings with regulatory authorities are still ongoing.

Ladies and gentlemen, we have reached the end of the question-and-answer session. And I'd like to turn the call back to Mr. Stephen Yoder for closing remarks.

Thank you. And I just want to end by thanking everyone again for your attention today and for your continued support of the company. We look forward to keeping you updated on our progress and I want to wish you a great day. And thanks again for joining the call. Stay safe. Thank you.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.