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Q4 2023 Alector Inc Earnings Call

Participants

Katie Hogan; IR; Alector, Inc.

Arnon Rosenthal; Co-Founder, CEO, and Director; Alector, Inc.

Gary Romano; CMO; Alector, Inc.

Sara Kenkare-Mitra; President and Head of Research and Development; Alector, Inc.

Marc Grasso; CFO; Alector, Inc.

Yaron Werber; Analyst; TD Cowen

Jeffrey Hung; Analyst; Morgan Stanley

Paul Matteis; Analyst; Stifel Nicolaus and Company, Inc.

Greg Harrison; Analyst; Bank of America Global Research

Carter Gould; Analyst; Barclays PLC

Corinne Johnson; Analyst; Goldman Sachs

Myles Minter; Analyst; William Blair & Company

Pete Stavropoulos; Analyst; Cantor Fitzgerald LP

Thomas Shrader; Analyst; BTIG

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Neena Bitritto-Garg; Analyst; Deutsche Bank

Amanda Bush; Analyst; HC. Wainwright & Co., LLC

Presentation

Operator

Good day, and thank you for standing by, and welcome to Elekta's Q4 2023 earnings conference call. At this time, all participants are in listen only mode after the speakers' presentation, there will be a question and answer session to ask a question. (Operator Instructions) Again, please be advised that today's conference is being recorded. I would now like to turn the conference over your speaker for today, Katie Hogan. Please go ahead.

Katie Hogan

Thank you, operator, and hello, everyone. Earlier this afternoon we released our financial results for the fourth quarter and full year 2023 press release is available on our website at www.alector.com, and our 10-K was filed with the Securities and Exchange Commission this afternoon, and joining me on the call today are Dr. Arnon Rosenthal, Co-Founder and CEO; Dr. Sara Kenkare-Mitra, President and Head of Research and Development; Dr. Gary Romano, Chief Medical Officer; and Dr. Marc Grasso, Chief Financial Officer. After our formal remarks, we'll open the call for Q&A.
I'd like to note that during this call, we'll be making a number of forward-looking statements. Please take a moment to review our slide on the webcast, which contains our forward-looking statement disclosure, and we also encourage you to review our SEC filings for more information. I would now like to turn the call over to Arnon Rosenthal, Chief Executive Officer. Arnon?

Arnon Rosenthal

Thank you, Katie, and good afternoon, everyone, and thank you for joining Alector for our fourth quarter and full year 2023 financial results conference call. I'll begin by highlighting the broad mechanistic potential of our immuno-oncology candidate or candidates recruit microglia, the brain's primary immune cells to combat neurodegeneration by containing multiple classes of misfolded protein, maintaining brain health and organ function and supporting the maintenance of healthy synapses astrocytes oligodendrocytes, the blood-brain barrier and the vasculature by harnessing microglia are candidates aim to comprehensively address the complex pathology of neurodegenerative diseases, potentially providing long-lasting clinical benefit across multiple disease stages.
Our investigational drug candidates have the potential to be effective as stand-alone therapies or in combination with other treatments, particularly those targeting misfolded proteins, the broad disease fighting mechanism that our drugs that activate as well as the potential synergy between our immuno-oncology candidates and therapies directed against misfolded proteins has the potential to elicit a more potent therapeutic benefit with longer durability and better efficacy at multiple disease stages compared to current therapies against misfolded proteins.
As I reflect on the past year, I am pleased to highlight that 2023 was marked by successful clinical execution and clarity around time lines for our advanced clinical development programs. We achieved significant milestones in our late-stage program, reinforcing a lactose standing as a pioneer in immuno-oncology. Importantly, we completed trial enrollment for our two lead programs include the pivotal in front to a Phase three trial for of our progranulin elevating candidate at that cinema in frontotemporal dementia with progranulin gene mutation or STBGRAN. and invoke to Phase two trial of our term to candidate AL. zero zero two in early Alzheimer's disease in partnership with GSK.
We also risen recently dosed the first participant in progress, A. B, the Phase two clinical trial of AL. one one in early Alzheimer's disease. Furthermore, in February 2020 for the FDA granted breakthrough therapy designation to Ratos avelumab for FTVGRN., marking another significant achievement. It is worth noting that although to be the complex disease clinically, we have developed a straightforward approach to correcting progranulin deficiency, the underlying cause of the disease. Collectively, these advancements move us closer to potential meaningful data readout this year and next in January, we also further strengthened our balance sheet with the completion of $75 million of follow-on financing, which Mark will touch on further later in this call. Sarah will provide insight in our early research and development efforts, including a lack of brain carrier technology platform.
Our commitment to addressing all the generation remains unwavering and with our advanced pipeline strong cash position, we are well-equipped for meaningful value creation in the next phase of our growth this year, we'll continue to focus on delivering and translation and translating our progress into meaningful impact. An important event will be the anticipated data readout from Embark to Phase two trial of L. zero zero during the fourth quarter. This will potentially be a major step forward in elucidating our immune-oncology hypothesis together with the support from our partners.
We are committed to advancing neurodegenerative disease research, reflecting our firm belief in immuno-oncology in the non-oncology potential. With that, I will turn it it over to Gary to talk about our goals and expectations for our clinical development program. Gary?

Gary Romano

Thank you, Ana. And I'll begin with our LCS here to program the most advanced cancer program in clinical development for Alzheimer's disease. Algiers here too is a novel investigational humanized monoclonal antibody that binds to and activates trend to a key microglial receptor that senses pathological changes in the brain binding of LTROs here too, that the trend to receptor triggers microglial signaling pathways, which increased microglial proliferation, survival and function, enhancing the effectiveness of microglia for protect the brand against insults, including age related neuro degenerative disease.
We completed our Phase one trial of AL. two years or two in healthy volunteers, which demonstrated both dose-dependent target engagement and activation of microglia in the trial. ALCOCO. two was also shown to be well tolerated. Our ongoing invoke two Phase IIb study of AL. zero zero two is a randomized, double-blind, placebo-controlled common close designed study of up to 96 weeks of treatment with LCOs here too, in which 381 participants with early Alzheimer's disease were randomized.
The study includes three doses of Algiers here too, that demonstrated robust target engagement and increased microglial signaling in phase one in both to completed enrollment ahead of schedule. In September of last year. The primary clinical outcome measure for the study is the CDR sum of boxes. We're also collecting secondary clinical and functional outcome assessments, including the ADAS-Cog 13 and ADCSADLMCI., from which we will derive treatment effects and the integrated Alzheimer's Rating Scale or high interest.
The trial will also deliver a robust biomarker package, reflecting target engagement as well as treatment effects on microglial activity and Alzheimer's passive physiology treatment effects on Alzheimer's path physiology will be assessed with CSF and plasma biomarkers of A-beta and tau as well as both amyloid and tau PET and will also have biomarkers of Astra closest neuroinflammation. And that's the Chemicon neurodegeneration.
We intend to use a proportional analysis approach with this study, which will enable us to use all of the data collected in this common close design trial, meaning that it will include data from all participants out to 48 weeks and also include additional longer-term follow-up from those participants who were in the study for up to 96 weeks. We also have a long term extension will remain blinded to treatment assignment and thus can provide additional information on long-term safety and also on treatment effects on clinical outcome measures and biomarkers.
As we reported last year at a I see a subset of participants in the ongoing Phase two trial have had treatment emergent MRI findings that resembles the analog aggregated imaging abnormalities or area that has been observed with anti amyloid therapies. These MRI findings are indistinguishable from area with regard to the MRI features, incidence, timing of onset and resolution relatedness to the number of APOE four wheels as well as to the frequency and spectrum of associated clinical manifestations in the current trial population that includes equally for heterozygous and APOE4 noncarriers analysis of the still blinded data shows an incidence of ARIA in our age of approximately 20% of those with RUE.
Approximately 90% have been asymptomatic and most symptomatic participants have had mild and self-limited presentations most relevant from a clinical perspective, the incidence of clinically serious area that is those with ARIA related SAE.s, it's just under 1% of all participants that have been dosed an independent data monitoring committee reviews data from this trial regularly and continues to recommend that the trial proceed our goals for invoke to trial and for the LTOs here too in the long term are to slow the progression of Alzheimer's disease by therapeutic restoration of microglial function. While one of the potential effects of trim to agonism may be to increase the clearance of misfolded proteins, including amyloid. We expect ALTRC. or to also amplify the broader beneficial effects of healthy microglia on the brain.
This includes maintaining synaptic connections supporting astrocytes and oligodendrocytes function for serving the blood-brain barrier and vasculature and upholding immune tolerance. Thus, our expectation as the risk is that the restoration of microglial function by LCOs here to reduce the brain's vulnerability to neurodegenerative disease and that the ENVISION trial will demonstrate treatment related slowing of Alzheimer's disease progression as demonstrated by a combination of clinical functional and biomarker readout, given the multiple mechanisms by which healthy microbial protect the brain against neurodegenerative disease.
We hypothesized that by the end of development, ALCRC. or two may ultimately displace stronger efficacy than current therapies to target individual misfolded proteins through its novel and complementary mechanism of action. We expect LTOs or two to be effective either as a stand-alone therapy or in combination with anti-amyloid therapies. Given that agonism of trend two has the potential to reduce the brain's vulnerability to neurodegenerative disease through these multiple downstream mechanisms, we believe that treatment of benefits of LTOs here to may manifest differently from what we have seen in the anti amyloid antibody trials.
For example, with regard to biomarker responses, lowering cerebral amyloid PET signal to the 20 to 30 Centroid threshold, which for anti-amyloid antibodies appears to be a necessary condition for clinical efficacy. It may not be relevant to this mechanism of action that goes beyond amyloid clearance. Additionally, optimal disease stages for intervention may be broader. Unlike therapeutics targeting amyloid or tau, we do not expect the beneficial effects of healthy microglia to be limited to specific parts of physiological stages of disease and thus, sales yields here too as potential to benefit patients from preclinical Alzheimer's disease through advanced dementia.
I'll now turn to lead us into Matt for novel first-in-class progranulin, elevating candidate and the most advanced therapeutic and clinical development for the treatment of frontotemporal dementia. You may recall that legacy Nomad has previously received both orphan drug designations for FTD and Fast Track designation for FTD granulin from FDA. We are pleased to share that in February, FDA granted listen, I-Mab Breakthrough Therapy Designation for FTD granulin based on our INFRONT two Phase two clinical trial data, FDA's breakthrough therapy designation is granted to expedite the development and review of drugs that are intended to treat a serious condition when preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over available therapy on clinically significant endpoints.
With this designation, we look forward to continued productive conversations with the FDA recognizing the unmet need for people living with FTD granulin, a serious condition for which there are no FDA approved treatment options available in October 2023, we achieved target enrollment of the pivotal randomized, double-blind, placebo-controlled in front three Phase three clinical trial of Leidos Intermat randomizing 103 participants with symptomatic FTD granulin and 16 participants who are presymptomatic at risk for FTD granulin.
Our goal is to enroll 90 to 100 symptomatic participants, supported by feedback from FDA and EMA. We are actively progressing the Infront three trial in partnership with GSK and look forward to the pivotal Phase three data readout following the 96 week treatment period. I'd like to now turn to a oh one oh one. Our second product candidate in our progranulin portfolio that we are developing in partnership with GSK.
Michael Harrison, I-Mab. A wonderful one is a monoclonal antibody that blocks sortilin to elevate progranulin levels. Its distinct pharmacokinetic and pharmacodynamic properties have potential to enable dosing regimens that may be more suitable for use in the treatment of larger indications such as Alzheimer's disease. Our Phase one study in healthy volunteers demonstrated that a oh one oh one was well tolerated and increased progranulin levels in plasma and CSF in a dose-dependent manner in August 2023, Alector and GSK received FDA clearance of its IND application for a oh one oh one in the treatment of early Alzheimer's disease.
The rationale for treatment of Alzheimer's disease is that genetic variants that result in modest reductions of progranulin levels are associated with an increased risk of developing Alzheimer's disease. Conversely, in animal models of Alzheimer's disease, elevation of progranulin has been shown to be protective in February of this year. The first participant was dosed in the progress AD. study of AL001 oh one, which is being operationalized by our partner, GSK progress AD. is a randomized, double-blind, placebo-controlled Phase two clinical trial of A. oh one oh one, enrolling approximately 282 patients with early Alzheimer's disease at multiple sites globally.
The 36 week study is designed to assess the safety and efficacy of two dose levels available to one compared to placebo participants randomized to one of three dose groups receiving a oh one oh one or placebo intravenously. The primary endpoint of the study is disease progression as measured by the CDR sum of boxes. The trial also employs other clinical and functional outcome assessments and biomarkers. We look forward to sharing additional information on progress AT. as the trial advances. With that overview, I'll now turn the call over to Sarah to provide an update on our early research pipeline. Sarah?

Sara Kenkare-Mitra

Clearly, we are making meaningful strides in progressing our research portfolio to fuel our development pipeline and set the stage for our long-term growth. Our drug discovery engine is fine tune through a decade of deep biological exploration and experience and expertise in neuroscience as well as strong expertise and experience in antibody protein engineering and preclinical development. We have also developed a modular and scalable target discovery platform, which seamlessly integrates genetics, multi-omics and in-house generated VetLab data to uncover novel targets.
The system further improved predictions through machine learning based target identification, multidimensional functional validation and data integration with AI based analysis, our overall integrated approach allows us to move swiftly from target identification to the development of late-stage first-in-class immuno neurology drug candidates. In addition to our target and drug discovery engine, we have also made progress on our proprietary blood-brain barrier technology. While our late-stage clinical candidates show brain penetration and target engagement.
We are developing a proprietary versatile blood-brain barrier technology called electro brain carrier or ABC, to strive to lower efficacious doses with favorable safety and efficacy and enable delivery of additional novel drugs into the CNS. We intend to selectively deploy our technology in a fit-for-purpose manner on our next generation program that are currently in our early portfolio, ABC technologies that toolbox approach incorporating a suite of single-chain variable fragments, antigen binding fragments or variable heavy chain domains that bind to targets at the blood-brain barrier, such as transparent and CTE98 heavy chain with railing affinity.
We have been able to achieve greater than tenfold increase in vein concentrations of multiple cargoes and demonstrated deep brain penetration to cell types of interest like neuron and microglia. The modular nature of this technology allows the affinity vibrancy and format of the final therapeutic to be harmonized with the mechanism of action and sell that specificity of the associated cargo. We are also leveraging our ABC technology to advance the development of protein replacement therapies for neurodegenerative diseases, which align with our focus on genetic risk factors our technology's adaptability is demonstrated through versatile bispecific formats, complemented by customizable Fc adaptations for optimized effector function half-life and single chain configuration.
Based on the translatability of preclinical safety and efficacy studies, our technology appears to exhibit a favorable safety profile even when actively engaging with EPSi. We look forward to sharing more details about our innovative research portfolio, including our electro brain carrier technology during a virtual event later this year. I'll now turn it over to Marc to provide an update on our financial results. Marc?

Marc Grasso

Try to summarize in our fourth quarter and full year 2023 financial results, which we made available after the market close today, we are in a strong cash position to deliver against our strategic objectives. We continue to focus on fiscal management and program prioritization. And as of December 31st, 2023, our cash, cash equivalents and short-term investments totaled $548.9 million, strengthening our financial position. We completed a follow-on financing in January of this year, raising $75 million in gross proceeds. Inclusive of this raise, our cash runway is now through 2026, approximately a full year beyond the expected FTVGR. and pivotal Phase three in front three data readout in approximately two years beyond our trend to Phase two in both to data readout further, we are now also in a position to selectively accelerate investment in our innovative proprietary portfolio, including programs enhanced by our proprietary electro brain carrier technology platform. We appreciate the support of significant new investors as well as participation from our existing shareholders.
Now turning to our operating results. Collaboration revenue for the fourth quarter was $15.2 million compared to $14.4 million for the same period in 2022. Collaboration revenue for the year was $97.1 million compared to $133.6 million in 2022. Total research and development expenses for the fourth quarter were $47.7 million compared to $54.5 million for the same period in 2022. Total research and development expenses for the year were $192.1 million compared to $210.4 million in 2022.
Total general and administrative expenses for the quarter were $14.9 million compared to $15.4 million for the same period in 2022. Total general and administrative expenses for the year were $56.7 million compared to $61 million in 2022 for 2024 we estimate our collaboration revenue to be between $60 million and $70 million are anticipated. Total research and development expenses are estimated to be between $210 million and $230 million and total anticipated general and administrative expenses are estimated to be between $60 million and $70 million in December. Electric Costa to virtual research and development events discussing our trim two and progranulin programs in detail.
The events included presentations from leading scientific and clinical experts who encourage those who didn't have an opportunity to participate in the live events to watch the replays located under the Investor Events and Presentations section of our website. We remain focused on advancing our novel portfolio and electro bringing care technology to treat neurodegenerative diseases. We look forward to providing additional updates as we advance our work. That concludes our prepared comments for today's call. Operator, you may now open the line for Chris.

Question and Answer Session

Operator

(Operator Instructions) Yaron Werber, TD Cowen.

Sara Kenkare-Mitra

This is Brendan on for your own. Thanks very much for taking the question.

Gary Romano

Just a couple of quick ones from us actually.

Sara Kenkare-Mitra

First on the brain carrier program, just wondering if you might be able to give us a little bit more color on kind of just the broad approach to the platform.

Gary Romano

I mean, you mentioned transparent and CTE 98. Are you kind of at this point planning to kind of choose one and use that across the board for all the VC programs, are you going to get to go indication by indication basis? And then I guess really on the ADP. zero to seven asset that you called out in the press release. And kind of just wondering what drove the decision to target gpNMB and maybe how applicable that target would be kind of to the broader Parkinson's population.

Sara Kenkare-Mitra

Thanks very much.

Katie Hogan

And I'll just address the question about the blood-brain barrier technology, and then I'll pass it to Harlan to to answer your question on GPNMB briefly, you know our blood-brain barrier approach, as we said in place of a versatile, big main carrier technology, and we are targeting our blood-brain barrier proteins, both TFR. and CD. 90 heavy chain. But at this moment, we are going after both these targets and applying them across both our second generation second-generation efforts for our current on late-stage programs as well as our new novel sort of target molecules in research and certainly do not have any intent initially to choose one or the other we will, depending on on the best, the best approach for each target and each molecule. And again, we're using a very adaptable technology, which allows us to customize for therapeutic affinity Valence, et cetera. We've got our bispecific formats and customizable FC. adaptations that allow us to tweak effector function as well as optimize half-life of the molecule. So our approach currently is to drive both these both these approaches targeting approaches trafficking approaches both for our late-stage programs as well as for our novel targets. Maybe Arne can share his thoughts on our 80 people to seven program that you can?

Yaron Werber

Yes. So yes, we do think that gpNMB targeting will be applicable for sporadic Parkinson's disease. Gpnmb is the lysosomal regulator or it's a risk gene for Parkinson's disease. There are both risk and protective barrier islands, and we developed a drug that may meet and exceed the protective variant. And we think that sort of fair lysosomal pathology is a general feature in Parkinson's disease and gpNMB is interacting with the lock to interacting with Jacada to other risk genes for Parkinson's disease. It's up-regulated in multiple types of sporadic PBC. So we do think that it will be applicable before for any type of Parkinson's disease.

Marc Grasso

All right.

Sara Kenkare-Mitra

Thanks very much.

Operator

Paul Matteis, Stifel.

Jeffrey Hung

Hi, this is Julian on for Paul. Thanks so much for taking our question. I guess on L. zero zero to the trend to program some with the readout expected towards the end of the year, the trials and anticipated to run for about a year, at least for at least at a minimum. In terms of follow-up, I guess what gives you guys confidence that this will be long enough separate from placebo? And do you anticipate at all that there will be a significant group of patients out to two years.

Sara Kenkare-Mitra

And any other color on how the overall data will be analyzed or shared and a top line would be super helpful.

Arnon Rosenthal

Thank you.

Paul Matteis

Yes, hi. Thanks for the question. This is Gary. So the study, as you heard, was a common close sites in which all patients will stay in the trial. We're up to 96 weeks and then roll over into long-term extension. And that is until the last patient out reaches 48 weeks at which time all patients will roll over into the long-term extension. And so we will have data not only of what we have paid out the 48 weeks on everybody, but we'll also have data out to two will have, for example, clinical outcome assessments out to 96 weeks on a good subset of patients. We're planning to use in an analysis method called a proportional analysis method or proportional MMRM, for example, which uses all of the data. So it's not just the time to event at one time point, but it includes data at all from all time points as a way of getting the most out of your data by by using all of the data. And that's our plan for the analysis for the primary analysis we asked the question about do we think this is enough time to see treatment effect. We're looking at treatment effect in this study as happy and and ELEKTRA designed the study in order to be a biomarker study, and that will look at the totality of the data. So looking to see that we can slow Alzheimer's disease through a combination of clinical functional and biomarker readouts. And we're going to have a very robust biomarker package that includes not only what we originally intended, which would be amyloid and tau PET study sub-studies, but also now with the acceleration in validation of phospho-tau assays, we'll be looking at future on seven and tau aggregates in plasma on all patients. So we feel confident that we are going to through this totality of this data, the able to determine whether we're slowing the progression of Alzheimer's disease, which is what the original our design was intended to do.
Excellent.

Gary Romano

Thanks for the color.

Operator

Jeffrey Hung, Morgan Stanley.

Gary Romano

Hi, Steve.

Marc Grasso

Hi.

Paul Matteis

This is Michael Yang on for Geoff, and thank you for taking our question. Um, for Rinvoq, how do you expect levels a sizable chunk to account for patients at baseline was preclinical AD versus maybe a little bit more progress. Dementia like does a higher baseline valuable time to like imply higher chances for it's a pharmacodynamic effect.
So first, let me just add this is Gary again, just to clarify, we are enrolling patients, as you said, with early Alzheimer's disease. We are not enrolling enrolling, for example, just those with genetic variants like the R4 37 H. variant. You know, we don't believe that the baseline levels of sizable chunk to necessarily we don't really know whether that's going to predict a pharmacological effect, but we what we would expect in our study is that and the binding of the of sales here as we are to trend to causes internalization of the receptor and this actually causes a reduction in soluble trend, too, because what we're basically doing is is reducing by binding and internalizing receptor. We're lowering the levels of and microglial membrane trend to which are and that reduces the amount of the cleavage product, sizable chunk to which is consistently cleaved in from time to right. So we plant we will see as we saw, we intend to see as we did in Phase one, a reduction in cycle time, too. And we again, there's different ideas about cycle time to what its role is. We believe that primarily it's just it's a really a marker of membrane trim two and three, there have been and there's a fair amount of data out there that suggests that cyclical trend to levels, which are again, are reflecting the amounts of trend to in the membrane correlate as they are higher. They correlate with with better outcomes or progression of disease of Alzheimer's disease or slower conversion from MCI to Alzheimer's disease, slower progression of brain volume loss. So again, but that is a function basically of having greater trend to activity. And our antibody A. increases jumped to signaling.

Gary Romano

Thank you so much, really helpful.

Greg Harrison

Yes.

Operator

Pete Stavropoulos, Cantor Fitzgerald.

Sara Kenkare-Mitra

I are on the team.

Paul Matteis

Thank you for taking my questions on. So first, wondering, I believe that for the invoke two study of the placebo rolls over, you will start, you will be starting them at a lower dose than those in the original randomized to active arm and then titrating them upwards.
Can you just discuss the timeline for the titration and though will you be able to capture any data points, you know, especially biomarker wise, that could suggest that the starting dose is therapeutically active?
And if so, what would be the key biomarker or biomarkers you believe may be informative at that time point?

Marc Grasso

Yes.

Sara Kenkare-Mitra

Thanks, Pete.

Paul Matteis

Good question. So that you're right where we are. So just to clarify in the long-term extension, all patients that were on active doses in the double-blind will roll over to the same dose and continue in the long-term extension. Those that were originally randomized to placebo will be rolled out and the titrated up started on active beginning with a tight with a at a lower dose. That's right, six milligrams per kilogram and increase, and they will they will be dose escalated every two months. And the reason and one reason for doing this is to learn more about the potential mitigations for the Ariol like signal that we're seeing, as you know, and but some of the anti amyloid therapeutics, there's been some data that suggests that starting at a lower dose and or titrating more slowly than we did in this double-blind study could be mitigate. So that's one advantage. We do believe that this slow titration that was actually going to help us in another way and not only to learn about mitigation for area, but also help us to in a sense it will this is a long-term extension, which by the way, we invested with AbbVie to keep this blinded to the original treatment assignment. This will give us an opportunity to continue to follow patients beyond the double blind into the long-term extension to us to look for not only for safety, but also to look for treatment effects on biomarkers and most importantly, on clinical outcome measures. So fortunately, for example, with the common close design, some of the patients will have nearly a year of data follow-up data on clinical outcomes. But in the long-term extension, which really essentially be a randomized start design, we'll be able to look for support for differences between the original placebo group and the and the of the active dose groups in the long-term extension, we'll be able to look at those clinical outcome assessments and differences from the between the placebo and active in that long-term extension.

Carter Gould

Right.

Corinne Johnson

Thank you for that. One question on the on the Phase two for AL. one zero one was originally initiated with GSK.
Just on looking at the study design, I see that there are two undisclosed doses are being evaluated. How did you select those doses, as you know, if you can tell us, I know was it based on a certain level of PRGPGPRGNI. increase in the Phase one? Are you trying to keep it above a certain threshold or below a certain level?
Yes, Sarah, I'll start. Maybe, Sarah, do you want to chime in on the on the PK here that the behavior?
Yes, these. So we have two doses. We have a maximal dose that gives us maximal elevations of progranulin, and we also chose a somewhat lower dose. And those the I'm not sure how much of this we've disclosed in terms of the actual doses and the and the randomization ratio. So I mean, I have to defer to Mark or Sarah as to whether we were a special event in Spain.

Myles Minter

Thanks, Gary. I agreed, Pete. We haven't disclosed the actual doses or the selection, but mostly that the doses were selected based on the PK and PD data that was generated in our Phase one single and multiple ascending dose study and based on progranulin levels, of course, on. So it was the elevation of progranulin in plasma and CSF that was modeled. And based on this, the two doses were selected, we haven't really shared the exact doses or the exact criteria for the selection of the dose Okay.

Pete Stavropoulos

Thank you for taking my questions.

Operator

Greg Harrison, Bank of America.

Gary Romano

Your line is open and good afternoon and thanks for taking the question of what endpoints that you'll report from the book to trial, do you think will be key to understanding the benefit of LO. twos various mechanisms beyond annualized reduction and potentially showing differentiation versus anti-amyloid antibodies?

Marc Grasso

Yes.

Thomas Shrader

Thank you for that question, Greg, on. So just to remind everyone, the mechanism here is that we believe the steric therapeutic restoration of microglial function that will slow disease progression. And as you mentioned, that includes may include enhanced clearance of misfolded proteins like amyloid, which we know is one of the important functions of microglia. But there are also a number of other beneficial effects of microglia that they do in normal maintenance to preserve brain health, reduce vulnerability of the brain to two insults, including age-related neurodegenerative diseases. And I think we mentioned this a couple of times in the presentation. So the euro and in this study, therefore, we are and again, this is a novel mechanism, and we think that it's important to to realize that the and that through these various downstream mechanisms that help of healthy that are in play because of healthy microglia that there are there are a number of things we can measure and we're going to be measuring in the study, including outside the typical Alzheimer's biomarkers and we mentioned A-beta and tau, both in plasma and on PET scans will also be measuring astrocytes effects on astrocytes and synapses and and then just a function, et cetera. I think the totality, really what the decision is going to be based on the whether or not we're slowing the progression of Alzheimer's disease. And so all of those mechanisms to be meaningful have to add up to a slowing in the progression of disease. And that will probably be best measured by a clinical outcome measures and also by biomarkers and of those biomarkers not only a beta, but very importantly, the tau biomarkers because we know that tau changes and talent, how aggregates travel or correlate most closely and with disease progression in a day and so we'll be looking at the clinical outcome measures of the looking at the Alzheimer's biomarkers, particularly, for example, a plasma P. two and seven and also looking at how aggregates with other other tau possible assays like the microtubule binding region assay, I want to emphasize, you know, the study is powered for and for clinical effect of about 40%. That's a big effect. So we we may or we may not see a clinically significant effect that that size in this relatively small Phase two study. But again, the original design was intended, not not to not to be a decision made on the primary clinical endpoint, but on the totality of the data, particularly the biomarker data that I mentioned.

Neena Bitritto-Garg

Got it.

Paul Matteis

That's that's really helpful.

Marc Grasso

Thanks.

Amanda Bush

Thank you, Greg. One moment.

Operator

Corinne Johnson, Goldman Sachs.

Pete Stavropoulos

And just one follow-up. Could you please share what's embedded in the cash runway guidance with respect to clinical activities more so beyond the near term to make commitments?

Gary Romano

Yes, thanks. For the questions.

Sara Kenkare-Mitra

I think the question was around what's included in the cash runway guidance. So the cash runway guidance, as noted is now through 2026 months, about two years post the expanded trend to data and also of approximately full year beyond the anticipated FTDGR. and Phase three data and also allows us to accelerate our investment in our blood-brain barrier technology platform and also our proprietary early-stage pipeline. Importantly, it's conservative in the sense that we're not including any milestones from partners, including the potential significant opt-in from AbbVie at the end of the completion of the Phase two. And it doesn't include a full spend on oh two through the Phase two completion. Also continued spend on that program for the extension study and spend on the FTDGR. and Phase three and also spend on the recently commenced on a scale of one Tier one Phase two for Alzheimer's disease. Those are those are the major components in addition to continuing to progress our blood-brain barrier platform and early pipeline.

Yaron Werber

I'm just thinking through thanks for the questions.

Operator

Carter Gould, Barclays.

Gary Romano

This is Leon on for Carter. Thanks for taking my question.

Paul Matteis

So we have two on invoke oh two.

Gary Romano

So at this point, do you have alignment or understanding with AbbVie on what a potentially good proof profile can look like on the readout and in terms of your update on achieving 90% enrollment in the OE. from Invokana to now, that's against the backdrop of having the REO like effects you've seen. So we want to get your thoughts here on the implication of getting and with 90% enrollment into OLE., is there some nuance that we're missing or anything that you'd like to highlight in terms of what this could tell you about the safety and tolerability profile?

Marc Grasso

Thank you.
Yes.

Paul Matteis

Well, to the latter question, it's just that that's 90% of those those that were eligible to roll over out of the kind of the 90 60 common close designed study. And um, and I mean, I think that we believe that reflects an interest in patients to continue. There are increasingly other other options like they can start taking account of that, but most like to see it here or 90% or so or a rolling over and staying in touch in the long-term extension, which we interpret positively in terms of tolerability and potentially other effects of the drug. But we can't specify we really can't no speculate on this point.
I'm blanking on your first question, our tests, can you just remind me at the beginning, I'm sure of the number you're asking you're asking about why November now about the readout, right. So yes. So I'm sorry, I'm sorry, I blanked out there. So.
Yes. So as I mentioned, we've been aligned with AbbVie, really from the start on on how we designed this study that we're really looking at the totality of the data to tell us whether we're slowing the progression of Alzheimer's disease, which would switch to make a decision on what happens next with this compound, whether it progresses. So that includes that includes, as I said, no clinical out clinical outcome measures, and it includes some functional measures, and it includes a lot of biomarkers. So and particularly, we're thinking that we'll be really focusing on those Alzheimer's biomarkers of Alzheimer's type physiology to tell us that we are seeing some slowing of the disease.

Marc Grasso

Yes.

Paul Matteis

No, I think you answered your question.

Operator

Myles Minter, William Blair.

Sara Kenkare-Mitra

I just a couple on impact to any sort of material differences that you're seeing in the ARIA incidence rates between the double-blind portion of inferred to the long-term open-label extension.

Gary Romano

I would assume that REO goes up if you're having placebo switched to active drug in that arm. That's the first question. The second one is you're measuring tallying all of those patients as you got to do a primary analysis by which you stratify by Talbot and similar to what Eli Lilly did and others have done in a post hoc setting.

Paul Matteis

Thanks.

Gary Romano

Yes, thank you.

Paul Matteis

On to the second question, we will we will have the capability of doing that post we didn't we didn't we have stratify the part that the patient, the study based on tau, but we will be able to look with possibly the plasma Pito on measures in order to in order to see whether there are differential effects based on baseline tau tau are not the baseline tau apathy now. And then I guess you do see other there are other good actually. And your first the first question was around the area cycle.

Marc Grasso

Yes.

Paul Matteis

So on we've shown we've shared this data, the MIT imaging MRIs and the MRIs themselves the clinical vignettes these patients and truly this looks indistinguishable from the area that is described with anti-amyloid antibodies. And with every regard with regard to timing of onset, for example, we see this early in treatment and then it really tapers off and the the time to onset and resolution of the related as equal to number of HB4 wheels, the MRI features themselves and the clinical manifestation. So it really we really we don't we don't see any differences and we've shown it to a number of the area experts who have also said that this is really indistinguishable.

Sara Kenkare-Mitra

And I think we see any differences between the main study and the extension study there.
Myles, to your Sure question, I see the RDR difference from the 19% to 23% that you reported yesterday after you're much?

Paul Matteis

Yes, no, sorry. Sorry, we were blinded to the Who's Who in the study, but no thought so far we have seen very little area in the in the long-term extension study.

Sara Kenkare-Mitra

Would that be an accountant earlier days with the extension of 30 miles?
So to Trident interop inferences from those percentages would be, you know, difficult.

Gary Romano

Colby. Thanks for the questions yet.

Operator

Neena Bitritto-Garg, Deutsche Bank.

Sara Kenkare-Mitra

It's David Novak on the line for any and I thank you for taking our questions. So on the ABCI. technology, can you discuss how your transferrin approach differs from other transferrin base delivery platforms? And then also on invoke to on given what you know about the ALO. two mechanism, which biomarkers do you see as being most likely be correlated with improvement on CDR sum of boxes or any other clinical end points?

Katie Hogan

Maybe I can start with the ADC technology and then Gary can address your second question.
So on in terms of our BBB. approach, it employs a versatile blood brain barrier carrier technology, which uses a suite of fragments that target, both TFR. and CD. 98 heavy chain. What we found is that thus far we're getting about tenfold increases in brain concentrations utilizing these of these multiple cargoes. I think what's unique about our technology is that it is an adaptable technology and it's sort of modular and is customizable based on the sort of the requirements of therapeutic affinity, bale and C and format, and we can match that to a variety of cargoes. We use bispecific formats and we are also able to customize and make adaptations to the Fc portion and have been able to sort of tweak a variety of ranges of effector function as well as our half-life. As we said in the call, in our safety and efficacy studies in nonhuman primates thus far suggest a favorable safety and efficacy profile even when we have FC engagement.

Marc Grasso

Yes.

Katie Hogan

And we will be, by the way, we will have a webinar on. So I don't the dates are set, but sometime this summer, of which we will go into a lot more detail on our technology. So please to join at that time, and I'll pass it to Gary, what was the lowest that question?

Paul Matteis

I'm sorry, I didn't hear.

Marc Grasso

Yes.

Sara Kenkare-Mitra

So sense for invoke to know, given what we know about the ALO. two mechanism, which biomarkers do you see as being most likely to be correlated with improvement in CDR sum of boxes or more generally our outlook?

Gary Romano

Yes, sure.

Paul Matteis

Well, again, that would be the out biomarkers of Alzheimer's type physiology. Most most importantly, I think the on the tau biomarkers, both we'll we will we will have tau PET, which would be a tau PET sub-study out, but we will also have plasma biomarkers on every on every body in the study, but the two, one seven and hopefully an microtubule binding region assay as well. So this will this will give us a that's the really the tau biomarkers are the ones that correlate most closely with clinical outcomes and really can be seen. I think is sort of a summing up the effect of the effects of these type of hypothetical effects of healthy benefits of healthy microglia on slowing the disease progression.

Marc Grasso

Great.

Sara Kenkare-Mitra

Thank you.
And congrats on the quarter for you.

Operator

Thomas Shrader, BTIG.

Sara Kenkare-Mitra

Good afternoon.

Gary Romano

This is Tom on for Tom or for the ongoing Phase two progress AD study, is there reason to perhaps stratify these patients based on a baseline program level for a possible topline out in the future? Thank you.
Yes. Thanks for the question, Tom.

Paul Matteis

We did not do we're not doing that and that's because it's in part of the evidence in favor or in support of this mechanism is that even even modest that mutations that cause even very modest effects and progranulin levels increased the risk of Alzheimer's disease. And and so we didn't believe it was it would be necessary and our processes is that this would be effective in slowing disease progression regardless of your baseline progranulin levels. There's also animal data, whichever you want to may want to speak more to that shows that in various animal models of Alzheimer's disease that just elevating progranulin itself is protective against disease. It's disease progression.

Gary Romano

Great thank you.

Operator

Amanda Bush, HC. Wainwright.

Gary Romano

Your line is open and say, Hey, congrats on the quarter given the biology of trend to and from your own or your data?
I think you know, there's little doubt that experts believe there is little doubt on the fact that the trend to might be involved in plaque removal.
Have a one question which I have. And you know, that's based on the kind of go into an animal and also a lot of questions on tau tau biomarkers today here. Given the data from those two trials and the recent publication validating plasma, Pito two one seven, as you know, due to the MRI data that Talbot the Talbot EBITDA data, along with the plasma tau biomarkers, puts you into a position where you can negotiate an accelerated approval pathway, which strategically might be very similar to the Council, the Council, the approach.

Arnon Rosenthal

So that's the question.

Gary Romano

Thank you.
Yes, thank you.

Paul Matteis

So if I understand your question, you're wondering whether based on on changes or just or treatment related changes until pad or until biomarkers. Could that could that be a basis of an accelerated approval approach?

Gary Romano

Right. I think if there is a clear clear sign that there is a remarkable change in the plasma tau biomarker based on the plaque removal up, is there a potential for accelerated approval pathway similar to cancel the approach?

Paul Matteis

Yes, I would I would never say no, I would say that when we open this up and we see what we have based on the robustness of the findings, and we would certainly if we thought that it was robust enough. We would certainly consider that.
We've also had questions about well, if we see if we see very significant amyloid warning because that itself could that also be. And again, I think we're going to at this differently. That's not the original intention in this trial. And but of course, we opened it up and we see what we have. If we think that there are potential paths forward, we will certainly explore it.

Gary Romano

Sorry, thank you.

Operator

I would now like to go ahead and call and turn the call back over to Marc Grasso for final remarks.

Marc Grasso

Thank you, operator, and thanks, everyone, for the thoughtful questions. Before we end the call, I'd like to share that we will be participating in a number of upcoming conferences, including TD Cowen's 44th Annual Healthcare Conference on March fifth in Boston clearance 2024 global Biopharma Conference on March 12th in Miami, Barclays Global Healthcare Conference on March 13th in Miami and Staples and S. days on March ninth 19th. Thank you again for your time and attention.
We'll now conclude today's call.

Operator

This concludes today's conference call. You may all disconnect.