Viking Therapeutics Inc (VKTX) 2020 Q1 法說會逐字稿

Good day, and welcome to the Viking Therapeutics 2020 First Quarter Financial Results Conference Call. (Operator Instructions) As a reminder, this conference call is being recorded today, April 30, 2020.

I would now like to turn the conference over to Viking's Manager of Investor Relations, Stephanie Diaz. Please go ahead, Stephanie.

Hello, and thank you all for participating in today's call. Joining me today is Brian Lian, Viking's President and CEO; and Greg Zante, Senior Vice President of Finance.

Before we begin, I'd like to caution that comments made during this conference call, today, April 30, 2020, will contain forward-looking statements within the meaning of the Securities Act of 1933 concerning the current beliefs of the company, which involve a number of assumptions, risks and uncertainties. Actual results could differ from these statements, and the company undertakes no obligation to revise or update any statement made today. I encourage you to review all of the company's filings with the Securities and Exchange Commission concerning these and other matters.

I'll now turn the call over to Brian Lian for his initial comments. Brian?

Thanks, Stephanie, and thanks to everyone listening on the webcast or by phone. Today, we'll provide an overview of our first quarter 2020 financial results as well as an update on recent progress and developments related to our pipeline programs and operations. I'll begin by commenting on the status of our Phase IIb VOYAGE trial within the context of the coronavirus pandemic.

As a reminder, the VOYAGE trial is evaluating our small molecule thyroid receptor beta agonist, VK2809, for the treatment of patients with biopsy-confirmed nonalcoholic steatohepatitis and fibrosis. Patient enrollment in this study has continued through the first 4 months of the year and remains ongoing.

Our participating clinical sites have reported varying degrees of impact from the pandemic, with some sites reporting delays due to shutdown-related restrictions and others reporting adjustments for recent FDA guidance for the conduct of trials during the pandemic. Others have remained open and have reported relatively minor impacts on the ability to conduct normal operations. We are continuously evaluating how this evolving landscape impacts our overall planning time lines, and I'll provide further color in a few minutes.

During the first quarter, we also advanced our program evaluating our second small molecule thyroid receptor beta agonist, VK0214, for the treatment of X-linked adrenoleukodystrophy, or X-ALD. We remain on track to file an IND and initiate clinical studies for this program in the coming months. I will provide additional detail on our development activities after we review our first quarter financial results.

With that, I'll turn the call over to Greg Zante, Viking's Senior Vice President of Finance. Greg?

Thanks, Brian. In conjunction with my comments, I'd like to recommend that participants refer to Viking's Form 10-Q filing with the Securities and Exchange Commission, which we expect to file later today for additional details.

I'll now go over our financial results for the first quarter ended March 31, 2020. Our research and development expenses for the 3 months ended March 31, 2020, were $8 million compared to $4.5 million for the same period in 2019. The increase was primarily due to increased expenses related to our clinical studies with the initiation of the Phase IIb VOYAGE study in November 2019.

Preclinical studies and manufacturing for our drug candidates partially offset by decreased expenses related to services provided by third-party consultants. Our general and administrative expenses for the 3 months ended March 31, 2020, were $3 million compared to $2.3 million for the same period in 2019. The increase was primarily due to increased expenses related to stock-based compensation, legal expenses and salaries and benefits, partially offset by decreased expenses related to services provided by third-party consultants and professional fees.

For the 3 months ended March 31, 2020, Viking reported a net loss of $9.7 million or $0.13 per share compared to a net loss of $4.9 million or $0.07 per share in the corresponding period in 2019. The increase in net loss and net loss per share for the 3 months ended March 31, 2020, was primarily due to the increased research and development and general and administrative expenses noted previously, as well as decreased interest income due to the decline in interest rates throughout the first quarter of 2020 as compared to the prevailing rates during the first quarter of 2019.

Turning to the balance sheet. At March 31, 2020, Viking held cash, cash equivalents and short-term investments totaling $269.2 million and had 72,562,863 shares of common stock outstanding.

This concludes my financial review, and I'll now turn the call back over to Brian.

Thanks, Greg. I'll now provide an update on recent progress and activity with our lead program, VK2809, and the ongoing VOYAGE Phase IIb trial. As a reminder, VK2809 is an orally available, small molecule agonist of the thyroid hormone receptor that possesses cell activity for liver tissue as well as the beta receptor subtype, suggesting promising therapeutic potential in a range of metabolic disorders, including NASH.

We previously reported positive data from a 12-week Phase II trial of VK2809 in patients with hypercholesterolemia and nonalcoholic fatty liver disease. As we've discussed on prior calls and updates, this trial was successful in reaching both its primary and secondary endpoints, demonstrating potent reductions in liver fat content as well as improvements in plasma lipid measures.

VK2809 has also demonstrated an encouraging safety and tolerability profile thus far. In the 12-week Phase II study, no serious adverse events were reported among patients receiving VK2809 or placebo. And the overall numbers of adverse events were relatively evenly distributed across treatment arms.

In our view, VK2809's oral route of administration, its impressive potency at doses as low as 5 milligrams per day, its liver-specific effects and its overall safety, tolerability and cardiometabolic benefits combined to make it among the most attractive candidates in the NASH development landscape today.

Following completion of the phase -- of the 12-week Phase II study, we completed several additional clinical and preclinical evaluations of VK2809 to enable us to file a new IND with the FDA's Division of Gastroenterology and Inborn Errors Products. These included Phase I studies to evaluate potential drug-drug interactions with statins as well as additional PK and efficacy study.

We also completed chronic toxicity studies to support long-term dosing in humans. The results of these studies as well as the results of prior clinical and nonclinical work formed the basis of an IND that was filed last year with the FDA. Following clearance of the IND, in November, we announced the initiation of a 52-week Phase IIb study in patients with NASH.

This study, which we have called the VOYAGE study, is a randomized, double-blind, placebo-controlled multicenter trial designed to assess the efficacy, safety and tolerability of VK2809 in patients with biopsy-confirmed NASH.

The study will target enrollment of approximately 340 patients across 5 treatment arms, including 1 milligram daily, 2.5 milligrams daily, 5 milligrams every other day, 10 milligrams every other day and placebo. The target population includes patients with F2 and F3 fibrosis as well as up to 25% with F1 fibrosis. The F1 patients must possess additional risk factors to be eligible for enrollment.

The primary endpoint of the study will evaluate the relative change in liver fat content as assessed by magnetic resonance imaging, proton density fat fraction from baseline to week 12 in subjects treated with VK2809 as compared to subjects receiving placebo. Secondary objectives include evaluation of histologic changes assessed by hepatic biopsy after 52 weeks of therapy.

We are currently dosing patients at clinical sites in the United States and expect to open additional sites outside the U.S. later this year. As I mentioned in my introductory comments, enrollment in this study continues, and we are diligently assessing the potential impact of the COVID-19 pandemic.

At present, while we are seeing disruptions of varying degrees, depending on geography and other factors, we believe we have reached a plateau with respect to disruption at clinical sites. We expect that variability and site behavior will continue until state-by-state lockdowns are eased on a broader basis. Importantly, at no point have we paused enrollment or indicated to our participating sites that we intend to defer activities required for trial execution. That said, the environment for clinical studies remains in a state of flux, and we have limited visibility on when things will return to normal.

We currently anticipate completion of enrollment in VOYAGE in the first half of 2021. We will continue to closely monitor the situation and engage our clinical sites and key vendors in order to best navigate the impact of the pandemic.

Regarding our plans to expand VOYAGE enrollment outside the U.S., we continue to anticipate the ex-U.S. site activations later this year and expect these sites to come online in the third quarter or approximately one quarter later than originally planned.

Turning to other VK2809 news. In the first quarter, we were notified that an abstract describing additional data from the prior 12-week Phase II study of VK2809 has been accepted for an oral presentation at the Annual Meeting of the European Association for the Study of the Liver, or EASL. As many of you know, EASL was originally scheduled to take place this month, but was postponed until late August. We look forward to delivering the oral presentation at this rescheduled event.

I'll now provide an update on our VK0214 program. Like VK2809, VK0214 is an orally available, small molecule thyroid receptor agonist that possesses selectivity for the beta receptor subtype. VK0214 is being evaluated as a potential treatment for X-linked adrenoleukodystrophy, or X-ALD, a devastating disease for which there is no approved treatment.

The disease is caused by a defect in a peroxisomal transporter called ABCD1. This defect can result in an accumulation of very long chain fatty acids in plasma and tissue, which are believed to contribute to the severe cerebral and motor neuron toxicities that are characteristic of the disease. Thyroid beta receptor is an important potential target for therapeutic intervention in X-ALD because it is believed to play a role in very long chain fatty acid metabolism.

To date, results from in vitro and in vivo studies have demonstrated that administration of VK0214 results in a significant increase in the expression of a compensatory transporter, which is believed to result in a reduction of very long chain fatty acids. In vivo models have demonstrated that these fatty acid levels are indeed reduced in both plasma and tissue following treatment with VK0214. These encouraging findings indicate the potential to offer the first pharmacologic treatment for this debilitating disease, and we are eager to move this program into the clinic.

During the first quarter, our team continued the IND-enabling work for VK0214, and we are on track to file the IND in the coming months. Following clearance of the IND, in the third quarter, we plan to initiate the first-in-human studies of VK0214 to be followed by initiation of a proof-of-concept study in patients with X-ALD.

Moving to other corporate updates. We are pleased to welcome another team member to the team here at Viking, with the addition of Juliana Oliveira, M.D., Ph.D., as our new Vice President of Clinical Development. Juliana comes to us with nearly 20 years of experience in metabolic diseases, having previously managed global programs at Sanofi, Takeda and Eli Lilly. We're excited to have someone with her qualifications on board at this critical time.

On the financial side, as Greg mentioned earlier, we completed the second quarter with approximately $270 million in cash, which we currently expect will provide sufficient runway to accomplish multiple important clinical milestones.

In conclusion, the first quarter has marked continued progress with our pipeline program. Enrollment is continuing in our Phase IIb VOYAGE trial, evaluating VK2809 in patients with biopsy-confirmed NASH and fibrosis. We continue to enroll patients and open new sites, and we are on track to open our planned ex-U.S. sites later this year.

Despite the significant impact COVID-19 has had on the global health care system, we expect a relatively modest impact on our enrollment time line, and we are currently anticipating completion of enrollment in the first half of 2021.

During the first quarter, our team also neared completion of the work required to submit an IND for VK0214, our novel small molecule for X-linked adrenoleukodystrophy, and we remain on track to initiate clinical development later this year.

Finally, during the first quarter, we were vigilant in managing our financial resources to ensure our ability to advance our clinical candidates into and through key clinical milestones.

This concludes our prepared comments for today. Thanks again for joining us, and we'll now open the call for questions. Operator?

(Operator Instructions) And our first question will come from Derek Archila with Stifel.

Congrats on the progress. So just a few from us. I guess, first, Brian, just wanted to make sure we're up-to-date here in terms of -- has the FDA fully granted approval for the IND out just 52 weeks from a tox perspective. Just wanted to check on that. And then 2 other just kind of to get your thoughts on in terms of -- we heard from the Genfit fellows that they're incorporating some metabolic composite endpoint in their study. And I'm just curious to know what your interactions have been with the FDA on potentially integrating that into your Phase IIb. And then second on the NGM data that we've seen from cohort 4, how does this kind of inform your thinking in terms of time on therapy and potential fibrosis improvement for a TR beta?

Derek, yes, thanks for the questions. With respect to the submission of our 12-month tox data, we submitted that shortly after the last update, which was back in February, I guess, the last update. And we haven't heard anything from the FDA because we have no reason to think that there will be any pushback on it, but we haven't heard anything back.

With respect to adding metabolic endpoints into the Phase II study, I'm not sure what endpoints you're referring to with Genfit. We have a number of lipid-related endpoints. We've got registration endpoints for NASH approval. We have a number of other investments as well, and looking also at some of the markers, Pro-C3, TIMP-1 and so forth. So we haven't discussed anything further with the FDA regarding additional endpoints to add to the protocol.

And I missed the last question on...

Sure. Just -- yes, just like the NGM data recently came out is kind of showing fibrosis improvement in as little as 24 weeks and just kind of understanding the time on therapy and how that could be important for TR beta in terms of being able to show a fibrosis improvement. Like, is there anything kind of key learnings from that experience that we've just kind of seen in the NASH and how you might apply it for further development here?

Yes. So a different mechanism, obviously. So I'm not sure on the reasonable read-through there. But I do think that to the extent that is an important driver and you can rapidly reduce it, that should have an impact more quickly than something that reduces fat more slowly. We've seen direct effect on fibrosis in the NASH models. But I don't know that we can translate too much of the NGM data. I mean, certainly, it's great to see the reduction in fat and the reduction of fibrosis. But I don't know, it's different mechanisms, so it's hard to make those sorts of translations.

Our next question will come from Joon Lee with SunTrust.

Congrats on the progress this quarter. And just wanted to get some clarity on the prior question. So you -- it seems like you submitted the full tox data to cover the patients to 12 months of dosing. Is no news good news in this case when it comes to FDA, having to comment on anything? And what's the deadline by which the FDA need to say anything before you get a green light on dosing to 12 months? And then lastly, when was your first patient dosed?

Thanks, Joon. Yes. So last question is we haven't disclosed when the first patient was dosed. We started opening for screening in November, but we haven't given a patient-by-patient sort of time line there. And the interesting thing about the review of the long-term tox is that there isn't really an established mechanism that we're aware of or it's not like filing an IND or an NDA or anything like that where there's a calendar that you watch. So we submitted the full dataset and haven't heard anything back. And I think if the FDA has questions or comments, we would certainly expect to hear something.

Great. And then one more question. And thank you for providing an update on the timing of the study of VOYAGE, which is now expected to be fully enrolled by early next year or mid next year. So what's your mix of academic to private clinical trial site? Our understanding is that the academic sites are more limited during the pandemic to enroll, whereas private clinics are more free and able to participate in clinical trials. Just curious what your mix is.

Yes. Actually, I don't know off the top of my head what the actual mix is. We have a lot of academic centers in the study. And it's true the restrictions at the academic sites have been, I would say, more austere than the local clinical sites. But yes, I don't know the exact answer to that. The disruption, I'd say, has been highly variable. We've had several sites that have reported really almost no disruption. But then you have a large academic site that closes down anything that's not COVID related. So it goes -- I mean, it runs a gamut of -- from that spectrum.

Our next question will come from Steve Seedhouse with Raymond James.

This is Ryan Deschner on for Steve Seedhouse. The question I have is regarding the $50 million stock repurchase. Basically, I'm wondering what ultimately tipped the scales and caused them to authorize that?

Okay. Thanks for the question. Yes. So we just think that having flexibility is just a matter of good corporate housekeeping. We have an ATM in place, and we put a share repurchase plan in place. I think it's just a matter of good corporate behavior.

Our next question will come from Jay Olson with Oppenheimer.

Congrats on keeping everything going despite the COVID-19 pandemic. Can you maybe talk about the different pushes and pulls in enrollment, which I think you said varied by geography? And then what assumptions, if any, were baked into your estimated time to complete enrollment as far as removing lockdown state by state?

Yes. It's a good question, Jay. And I don't really have a good answer because we don't have clarity on when all the lockdowns will be lifted. But I think the -- generally speaking, the assumption would be that most lockdowns would be eased sometime early in the third quarter. But again, very, very difficult if these early states that are lifting lockdowns have a surge in COVID cases, that changes the dynamic. But we would anticipate that most of the lockdowns will be lifted by mid-summer.

And what was the other part of your question?

That pretty much covers it. But I did have one follow-up. Can you just talk about what percent of your target enrollment of 340 patients is going to come from ex-U.S. study sites?

So we don't know. We do anticipate that we're going to have probably about 1/4 of the -- maybe a little less than 1/4 of the planned sites will be ex U.S. Some of those may enroll a little more rapidly. So it's kind of a balance. They're coming on a little bit later. There's a lower number of them related -- relative to the U.S., but some of them might perform better than some of the U.S. sites. So I think it's -- maybe a safe guess would be to assume around 1/4, but that's my own guess. I don't really have a good way to prognosticate that.

Our next question will come from Joe Pantginis of H.C. Wainwright.

And I hope you're all well. From a higher level standpoint, if you look at the broader impact of COVID on clinical trials, there may be more impact on earlier stage or newly started studies. So I think it's encouraging that you've not -- I'm sorry, that you haven't had any defined pauses yet, so that's good. So I'm just curious, with that said, do you have any industry insight into the impact for later-stage studies in the NASH space and potential competition for patients?

Yes, Joe, this is a great question because it's true. The impact is very different on studies depending on when they were started. And if you have a study that's ongoing and all the sites are up and running and screening is done, that's the type of study that really will have minimal impact. If you have a study that's just getting started in the ramp-up process, that's a more significant impact likely. So it's a great question. We've been fortunate. We've still been able to add sites and keep enrollment open. Different sites have adapted in different ways. A lot of them have transitioned to telehealth for the clinic visits. A lot of sites that have paused their own full opening process have been pretty aggressive with identifying patients who would qualify via prescreening. So -- but it is true that the ongoing studies, studies that are more mature, are less impacted than the studies that are earlier stage. And I think that has -- it holds across Phase II and Phase III. It just depends on where you are in that start-up process.

Got it. Got it. And if I could just shift gears really quickly to the pipeline. Just curious how would you characterize the status of 5211 right now. Is this something that's truly on the back burner? Is it percolating a little bit? Or do you have occasional calls with potential business development?

Yes. We have, I'd say, reasonably regular calls with interested parties on that. We have said in the past that, and as you know, we're not pursuing additional clinical development with it at this time. But it is not stuffed away in a closet somewhere. I think the BD dialogue there has been fairly consistent. We've been present at all of the BD meetings. And we've had, I'd say, robust dialogue around that program. The issue has always been -- particularly with the hip fracture setting is just that the registration path there is challenging and everybody grapples with that once they get into diligence.

Got it.

But it's not a dead process, I'll say that.

Our next question will come from Jason McCarthy with Maxim Group.

It's [Dave] on the line for Jason. So you mentioned that there were a handful of clinical sites who were experiencing some COVID-19-related disruptions. So that in mind, can we still expect a data read-out for the VOYAGE study in 4Q 2020?

No. What we indicated in the press release today is we expect enrollment to be completed in the first half of 2021.

Oh, excuse me, sorry about that. All right. That makes sense. And then regarding the potential partnerships for the hip fracture asset. Could you maybe shed some color on what sort of synergies you'd be looking into with respect to a potential partner?

Yes. So anybody who has an osteoporosis franchise, any company that has a program targeting muscle-related diseases, I mean, those would be the obvious collaborators for the VK5211 program.

Okay. Great. That makes sense. And regarding the VK0214 asset. When do you think a proof-of-concept study would be -- you guys mentioned that you plan on filing the IND kind of like mid-2020. So I just wanted to see what your thoughts...

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You're cutting out there a little bit. With the VK0214 program, we plan to file the IND around the middle of the year. And then the -- the clinical program will proceed as a single ascending dose study, followed by a multiple ascending dose study that we would then follow almost concurrently with a Phase Ib study in patients with X-ALD. So that's what -- and what the timing is for the proof-of-concept portion, the Phase Ib, we haven't given any timing there, possibly late this year or early next year, but haven't given any guidance on that one yet.

Our next question will come from David Bautz with Zacks Small-Cap Research.

So we've recently seen some fairly impressive liver fat reduction data from a once-weekly injectable therapy in NASH patients. And I'm curious what clinicians say to you about how they view a once-weekly injectable versus a once-daily oral therapy?

Thanks for the question. Yes. It probably depends on the clinician you asked. I think the feedback that we've received pretty consistently is that the VK2809 profile is very attractive. A daily oral is a very patient-friendly route of administration, mode of administration. The effect on lipids and other atherogenic proteins is favorable. The lack of weight gain, those sorts of things, all bode well for us. But that said, I think both the FGF21s and the FGF19s, the data are spectacular. And I think the market is certainly large enough to allow multiple significant products to coexist. And generally, I would expect an oral to sit early on in the treatment paradigm and the injectables further back, but that's just my thinking.

Okay. And real quickly, has the company made any purchases under the stock purchase program?

So we filed our Q this afternoon. And you can see in there, we didn't make any purchases at this point. We have not used the ATM or made any purchases.

Our next question will come from Yale Jen with Laidlaw & Company.

Congrats on the smooth pace of recruitment and under the current circumstances. And I have 2 quick questions here. The first one, just follow-up with the previous one. In terms of VOYAGE interim data analysis, you indicated that the enrollment may complete in the first half of '21, and I assume depending on the timing of that. So would the interim analysis data would be out in the end of the '21? Or would that be potentially pushed into 2022?

Thanks, Yale. The interim -- are you referring to the 12-week endpoint?

Yes. Yes, 12.

Yes, yes, that's the primary endpoint. So hard to know. I mean we would certainly expect to -- if things were able to resume, that we would be completing enrollment in the earlier part of that window I described earlier. But if the -- there's a second wave of shutdowns or a surge in COVID-related issues this fall, that could change things. So it's just very difficult to project right now, but we do think that the first half of 2021 is not an unreasonable estimate at this point.

Okay. Great. That's very helpful. And another follow-up here in terms of EASL presentation you will have in August, before you provide more details, but any general highlights of the presentation?

Yes. Well, we're subject to the embargo there, but it will be new data from follow-up visits from the study as well as potentially some subset analyses that were conducted on the data.

Our next question will come from Thomas Smith with SVB Leerink.

Just wanted to follow up and clarify on some of the earlier questions. Brian, do you need to actively hear back from the FDA regarding the tox data submission to enable 2809 dosing after 12 months? Or are you free to proceed if you haven't received explicit clearance?

Tom, thanks for the question. I would -- I think it stands to reason that if there is a reason to discuss the data, we would hear about it. And we certainly submitted it with plenty of time to review and discuss. So as I said earlier, though, there is no structure here for the feedback and process. So we submitted it and haven't had subsequent discussions, and that's just where we sit today.

Right. Got it. I guess just trying to figure out, Brian, whether or not hearing feedback from them ends up being a gating factor for you to continue dosing these patients out beyond the 6 months that you had originally received clearance for?

Yes. Well -- I mean in the other settings, the FDA is not shy about telling you, you need to spend dosing. So I would anticipate that if there's an issue, we would hear about it. And if we don't hear anything, we're not going to halt the study.

Our next question will come from Mayank Mamtani with B. Riley FBR.

Welcome Dr. Oliveira to the team, actually. So my question on screening for [VOYAGE 2]. So one was COVID related. Could you clarify if there's any change to the screening time that you have? Or what was the original screening time you had? Was it 4 or 8 weeks? And just to make sure you don't lose patients you may have had in the screening period, so anything that might have changed there? And then the non-COVID-related question I had was, as you know, there have been instances of other trials where due to biopsy variations among readers, certain patients who weren't supposed to be in the study may have creeped in. So are there any criteria that you're ensuring to make sure that you are not enrolling patients that shouldn't be in the study for safety reasons primarily?

Yes. Thanks, Mayank. Both really good questions. And we probably aren't going to get into the details of the study mechanics. But the FDA in the COVID-related guidance that they issued does allow some extension of screening window to accommodate inconveniences related to some of the state-by-state shutdown. I think that that's a tricky thing to navigate because you don't want that window to widen inappropriately, and you don't want the, for example, someone with a biopsy that's 5 months old to come in after 8 months and expect to be enrolled. So you have to be really careful with adjusting some of the things that you are okay adjusting. But if -- because of the COVID flexibility that's allowed. But I think the more you begin to deviate from some of the entry criteria, the more problematic the analysis of the subsequent data become. And so we're able to make some accommodations like that, but we've been leaning away from making dramatic accommodations because I think it creates a mass downstream. Great question.

What was the second one?

Yes. The second one was on the -- just on safety. Anything you're ensuring on the -- certain patients don't creep into the study that shouldn't be in the study based on learnings from other clinical trials at this limited stage?

Yes, yes, yes. So we are being particularly careful about any of the patients that are on the lower end of the NAS score and any patients who may be borderline on one of the subcomponents. And so those patients will receive extra attention to really try and obviate the issue that you highlight. And that's having someone come in who's kind of on the cusp of being too mild or something like that. The same issue arises with the fibrosis staging as well. You want to make sure that you've got an F3 and that's someone who's like an F2.9. So there's no such grade, but you know what I mean. So we are giving more attention to those patients who may be closer to the cutoff cusps.

Okay. And just to clarify, the DSMB schedule. I know you can't disclose that, but have you had any yet? Or like -- or is there any that is going to be around the time you get closer to that 6-month time window?

So we haven't disclosed that schedule at all. So there are multiple meetings, though. And so I don't know, that's probably all the more color that we're going to give on DSMB schedule.

Okay. Great. And just the final question was a little high level. So this off-treatment data you'll have at EASL, what is the thinking around, obviously, stopping treatment and maybe allowing other treatments to follow through? Or even combinations, if you could comment on what's your latest thinking there.

Well, on the EASL data, we'll look at data from patients who returned for a follow-up visit. What was the tie-in to the combos?

Any latest thought on the combination strategy? Like have you thought about...

Yes, yes. So separate question, yes. So I mean, we've considered a lot of different mechanisms to be suitable for combo. I think our preference is probably to remain with other oral agents rather than injectables. There's not a hard and fast sort of assessment, but it just makes the coadministration fixed-dose combinations, that sort of pathway is a little bit more amenable to more standard development process rather than a combination with an injectable. But I think a lot of these mechanisms could be suitably combined. We're just skewing towards the orals.

(Operator Instructions) Our next question will come from Scott Henry with Roth Capital.

A somewhat related COVID question. Let's say, you get a patient in the -- screened in the trial, active dosing, and 12 weeks comes up and the patient just goes dark for one reason or another because of COVID-19, what is the risk of patients kind of falling out of the trial, if any? Just curious your thoughts on that, and if you enroll a couple more patients, or maybe you don't expect that to happen?

Yes. Thanks, Scott. Thankfully, that hasn't happened at this point. So I think that those lost to follow-up cases would be treated -- I mean as they would be in any trial, you always lose some patients to follow-up, and you either impute their data, or older styles, use [LSDF] or something. But the -- we haven't had that issue. So it's not -- I mean it wouldn't be any different than somebody who gets in a car accident needs to drop out, or anything like that. So we wouldn't have any special accommodations there.

Okay. Great. And then a question just on the financials. Should we expect spending both on R&D and G&A to, well, I guess, to dip down in 2Q as activity perhaps slows down and then pick up in the second half of the year just from a modeling perspective?

It's pretty stable, maybe slight increment up in the second half, but pretty stable. Do you want to comment on that, Greg?

Yes. No, I agree. It's pretty -- yes, it's pretty stable throughout the year, but it's up a bit, as we said last time.

Yes, you see an incremental skew to higher expenses as you proceed through the year.

Our next question will come from Julian Harrison with BTIG.

Thinking about 2809's tolerability and safety profile and broader metabolic benefits, just wondering how you see the F2 landscape evolving in the next few years. And beyond biopsy-derived metrics, what patient characteristics or comorbidities do you think really reinforce the case for VK2809 in this setting?

Yes. So I don't think there would be necessarily any safety or tolerability issues with the -- really the F0 through the F3 population. It's different when someone becomes maybe very highly cirrhotic, may or may not be challenging to take VK2809, but that wouldn't be the candidate patient that we'd be targeting. I think the overall metabolic profile for VK2809 is really suitable for someone who has diabetes and dyslipidemia, along with NASH, with atherosclerotic disease due to the effect on atherogenic protein. So we are very fortunate that the mechanism has such a broad lipid-lowering benefit with trigs and LDL and apo B and a Lp(a), in addition to the effect on liver fat and potentially fibrosis. So we think that the patient population, the obese, the patients with dyslipidemia will be really great candidates.

Our next question will come from Yale Jen with Laidlaw & Company.

Just to really follow up what Scott asked, which is that I know it's not happening, but what is, going forward, COVID-19 situation do impact on patients coming in, but ultimately not being screened up? Would the protocol have any members that can have more patients to make compensation to that? Or that's not in the current sort of protocol design?

It's not in the current iteration. It hasn't been an issue. If you develop COVID as an enrolled patient, that would be treated as basically any other AE, but it would be due to COVID-19 infection. And to the extent that, that becomes a more significant issue for patient's health, they may elect to pause dosing or drop out or -- but that's no different from someone who develops any other illness during clinical trial. So there is no special accommodation. We don't have any plans to expand enrollment in anticipation of some COVID-19-related increase in dropouts.

This concludes our question-and-answer session. I would like to turn the conference back over to Stephanie Diaz for any closing remarks. Please go ahead, ma'am.

Thank you, again, for your participation and continued support of Viking Therapeutics. We look forward to updating you again in the coming months. Have a good afternoon. You can all disconnect now. Thank you.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.