Skye Bioscience (SKYE) Q4 2024 earnings call transcript

Hello, and thank you all for participating in today's call. Leading the discussion today, our Paneet Dylan, Skye's President and CEO, and Caitlyn Arsenault, Skye's CFO.

Before we begin, I'd like to caution that comments made during this conference call will contain forward-looking statements under the safe harbor provisions of the U. S. Private Securities Litigation Reform Act of 1995, including statements of both Skye's expectations regarding its development activities, timelines, and milestones.

Forward-looking statements are subject to risk and uncertainties that could cause actual results to differ materially and adversely, and reported results should not be considered as an indication of future performance.

These forward-looking statements speak only as of today's date, and the company undertakes no obligation to revise or update any statements made today. I encourage you to review all the company's filings with the Securities and Exchange Commission concerning these and other matters.

I'll now turn the call over to Paneet Dylan.

Good afternoon, everyone. Thank you for joining us today on Skye's fourth quarter and year-end 2024 earnings call. We appreciate your interest in Skye, and thank you to our shareholders.

Joining me is our entire executive team, and they'll stay online for the Q&A portion after the prepared remarks. At the start of 2024, we identified critical questions about perfully restricted CB1 inhibition, and implemented a clear vision and a plan for executing an ambitious clinical trial to demonstrate proof of concept of our novel CB1 inhibitor, the mass map, in patients with obesity and overweight.

This plan led to a 90 million investment from top life science institutional investors in the early part of 2024, ultimately allowing Skye to execute on its goals for the year.

I'm happy to report that not only did our team meet, but we exceeded our expectations. First, we submitted and received clearance of our obesity IND in January 2024. Second, following the completion of our 90 million dollar fundraising, we immediately initiated planning of our clinical operation activities for NEMASMAB, which culminated in the initiation of EBEON in August of 2024.

And third, our team's ability to execute efficiently resulted in rapid enrollment into the CBON clinical trial, and I'm proud to announce that as of February 28, we have completed our enrollment with 136 patients, and over enrollment from our originally planned 120 patients. And as a result of this accelerated over enrollment, we now expect final top line data from all patients in late Q3 or early Q4.

This is potentially three months earlier than our prior guidance, allowing us to forego the originally planned interim analysis, and instead report the full 26 week data ahead of schedule.

Fourth, on the manufacturing front, we transferred the manufacturing process for NEMASMAB to our manufacturing partner, and have initiated GMP manufacturing runs, as well as implemented plans for optimization, scale up, and commercial capabilities for NEMASMAB. Fifth, the excellent safety profile established in the MASMAB phase one trial continues as our independent data safety monitoring board, the DSMB has held two meetings to review the phase two A safety data and recommended that we continue to study as planned.

The study remains blinded through to the completion of the 26 week treatment and the 13 week follow-up period, and a third DSMB review is scheduled for April this year. To support SKY's increasing focus on the development of the MASMAB, we made the strategic decision in 2024 to discontinue SBI-100 development following the phase two A clinical trial. We believe that the reallocation of our resources from SBI-100 to the MASMAB was a valuable step to help us to reach the milestones that we've achieved.

Separately, 2024 also showcased important progress in the field of CV-1 and the vision, based to a clinical results from Monmunabant, Novanoridus, MOMO, CV-1 inverse agonist, revealed valuable insights for the class, and for us avenues of differentiation for NEMASMAB. Ahead of our all-important forthcoming NEMASMAB clinical trials, our preclinical and modeling work continues to paint a favorable picture of NEMASMAB's safety advantage as well as support the idea that purple CV-1 and ambition is sufficient for weight loss.

To briefly reorient you on our preclinical findings, the first question relates to efficacy, and whether a true, perfully restricted CV-1 inhibitor like NEMASMAB can lead to meaningful weight loss. This is a reasonable question. As the first drug approved for weight loss in this class, Romanumant preferentially entered the brain, and was originally believed to mediate its effects via central CV-1 and ambition.

Since then, we've learned so much more about the sufficiency and importance of peripheral CV-1 and ambition, versus the role of central CV-1 and ambition.

If you haven't already, I would encourage you to listen to our webcast from July, 2024, and November, 2024, where our clinical advisor, Dr. Marcus Gonzalez, and our CSO, Dr. Chris Twitty, elegantly explain why we believe that peripheral CV-1 and ambition is not only sufficient, but necessary for weight loss based on the mechanism of CV-1 and ambition. Supporting the thesis, we announced in 2024, the first demonstration that NEMASMAB can drive significant weight loss in a diet-induced obesity-mearing model.

And to our knowledge, this data is the first to describe that an antibody that does not cross the blood brain barrier and preferentially targets CV-1 receptors in the periphery can cause weight loss in a DIO-mearing model. We look forward to sharing even more data that demonstrates the ability of NEMASMAB to not only drive weight loss, but also impact multiple metabolic processes associated with obesity and its comorbidity.

The second, and we think most important question for this class of drugs, relates to safety. As we know, Riemannamant was ultimately taken off the market in Europe because of a significant rate of neuropsychiatric side effects, and importantly, a higher rate of suicidal ideation compared to placebo.

The concerns around this mechanism were further exacerbated by the announcement by Novonortis that while significant weight loss was noted at 16 weeks, there were dose-dependent increases in neuropsychiatric side effects with Monmunobant. At Sky, we believe NEMASMAB is uniquely positioned to potentially be the safest of the CV-1 class of drugs because of the superior restriction from the brain.

As we have reported previously, we saw no neuropsychiatric side effects from our Phase I study that treated over 60 patients with NEMASMAB for four weeks, and as highlighted earlier, the Phase IIA study has a quarterly independent data safety monitoring board review of safety data.

Our original investment and continued efforts to develop NEMASMAB is based on the premise that neuropsychiatric concern still hinder small molecules CV-1 inhibitors. Whereas, to date, NEMASMAB's truly peripheral mechanism has demonstrated meaningful weight loss without the safety liability seen with even the perfully restricted small molecules CV-1 inhibitors.

As mentioned earlier in our press release, we announced that we have implemented a protocol extension for the ongoing CV-1 trial. Specifically, with enrollment now complete, patients in all four treatment arms will have the opportunity to continue receiving therapy for an additional 26 weeks, increasing our treatment period to 52 weeks compared to 26 weeks previously. This means that by Q2 of 2026, Sky will have substantially greater safety and efficacy data, which we believe will significantly bolster our regulatory package and help discern NEMASMAB's therapeutic profile and differentiation.

Where 2024 was about successfully implementing our clinical operations plan and completing enrollment for CV-1, 2025 is about data. First and foremost, our clinical data from CV-1, but also data from our R&D efforts, which we hope will continue to demonstrate the impact of NEMASMAB in the DIO model. Our ongoing preclinical research aims to highlight a further understanding of how NEMASMAB's differentiated mode of CV-1 inhibition acts peripherally to promote coordinated modulation of hormones and inflammatory mediators, lipid metabolism, and glycemic control to ultimately yield significant weight loss and a productive metabolic homeostasis.

We anticipate that these efforts will yield additional data in the upcoming quarters, enhancing our understanding of NEMASMAB's capability. Additionally, we are advancing our research to explore other metabolic indications where inflammation and fibrosis play a significant role in disease progression.

By utilizing translational models, we aim to identify new therapeutic applications for NEMASMAB. Looking ahead, we plan to engage with regulators to align on our phase 2B dose escalation study, which we anticipate initiating by the second quarter of 2026. And concurrently, we're strengthening our manufacturing capability and evaluating alternatives to bring down our cost of goods sold. These efforts are crucial for maintaining our development pace and pairings for potential commercial demand.

We remain focused on NEMASMAB's attractive market opportunity and based on our ongoing assessment of both current and future market dynamics in obesity and overweight, combined with the latest developments underscoring the appeal of some of the novel mechanisms in obesity, we continue to view NEMASMAB as a differentiated alternative to enable weight reduction while addressing the limitations of increase in base therapy.

And with the translational workflow and full swing, we not only aim to identify new therapeutic applications for NEMASMAB, we're also focused on the development of next-generation GPCR targeting molecules to address various metabolic disorders which could potentially lead to innovative treatments in the field. Our overarching message is simple. We believe obesity and overweight conditions are extremely heterogeneous, demanding multiple effective therapeutic options while the GOP-1 receptor agonist space, whether we're speaking of oral or injectable drugs, is becoming crowded and competitive.

Recent industry deals do in fact acknowledge the merit and value of alternative anti-OBC mechanisms to start evolving the weight loss world beyond incritence. And sky is uniquely and strongly positioned with another promising alternative mechanism and highly differentiated product with potential to fulfill the unmet needs of this diverse and massive patient population rather than fighting for the same first-line thoughts of a well-established mechanism.

So we encourage discerning investors and other stakeholders to look under the surface and understand these dynamics. We believe NEMASMAB is uniquely positioned to play a role as a part of an inevitable broadening of the anti-OBC toolbox. With an important phase two inflection point this year, now is an opportune time to evaluate CB-1 targeting. At our June event during ADA, ahead of the top line 26 week data, we will review our plans along with additional pre-clinical data that demonstrate NEMASMAB's unique advantages.

We look forward to sharing these new insights with you. I wanna thank all of the patients, physicians and clinical coordinators who are participating in the CBON trial. Without them, we would not be where we are today. There are vital reasons why companies like Skye are able to potentially bring life-altering drugs to the market. Thank you for your continued support as we advance NEMASMAB and work to solidify Guy's position as a pioneer in perfully restricted CB-1 inhibition.

With that, I'll turn the call over to Caitlin or CFO.

Thanks, Finite. After the market closed today, we issued a press release and filed Skye's Form 10K with the Securities and Exchange Commission, outlining our annual financial results. We encourage you to reference the filings for details of our financials and the risk factors described therein. I will now provide a brief overview of key financial results for the fourth quarter and year ended December 31, 2024.

Research and development expenses for the three months ended December 31, 2024 were $7.8 million as compared to $1.6 million for the same period in 2023. The increase was primarily due to contracted clinical and manufacturing costs associated with our Phase 2A CBON study for NEMASMAB and employee related benefits. Research and development expenses for the year ended December 31, 2024 were $18.7 million as compared to $5.8 million for the same period in 2023.

The increase was primarily due to contracted clinical and manufacturing costs associated with our Phase 2A CBON study for NEMASMAB. The remainder of the increase resulted from increases in discovery research efforts, consulting fees, employee benefits driven by increases in headcount and general expenses.

General and administrative expenses for the three months ended December 31, 2024 were $4.6 million as compared to $2.5 million for the same period in 2023. The increase was primarily related to non-cash incentive stock-based compensation, payroll benefits, and other employee costs, professional services, including fees for tax, audit, legal services, financial advisory services, and other general business expenses. General and administrative expenses for the year ended December 31, 2024 were $17.7 million as compared to $7.9 million for the same period in 2023. The increase was primarily related to non-cash incentive stock-based compensation, professional services, including fees for tax, audit, and legal services, financial advisory services, patent prosecutions for the NEMASMAB IT and other general business expenses.

The net loss for the year ended December 31, 2024 totaled $26.6 million with non-cash share-based compensation expense of $8.3 million. Compared to $37.6 million for the year ended 2023, with non-cash share-based compensation expense of $1 million. The primary reason for the significant decrease related to the acquisition of the NEMASMAB in-process research and development asset for $21.2 million during the year ended December 31, 2023, all of which was expensive on acquisition.

In addition, during 2024, we recognized a $4.2 million gain from the partial D recognition of our contingent legal liability and a $2 million gain from the settlement of insurance litigation with our former D&O carrier, $3 million in interest income and a gain of $1.4 million from the sale of real estate. On December 31, 2024, Guy had cash and cash equivalents of $68.4 million. Notably, during 2024, we further remediated our litigation matters and in the fourth quarter, we collected two million insurance settlement proceeds and exonerated the bond related to the restricted cash balance, which allowed us to recover the $9 million restriction on our cash.

In addition, during 2024, we eliminated all of our related party balances, including the conversion of our debt. During 2024, our operating cash burn averaged $6.3 million per quarter, increasing to $8.1 million in the fourth quarter. In 2025, we expect to maintain at least this level of expenditure as we progress through the CBON study and increase our manufacturing efforts.

Our team's strength has always been its ability to quickly adapt, not only strategically, but also financially to reduce waste and maximize spend. We believe that our capital will fund our operations through at least the first quarter of 2027. Our cash runway includes the capital necessary to complete the phase two-way study for NEMAFMAB and reach key clinical milestones, including the receipt of top line data in late Q3 or early Q4 2025, 52-week data in Q2 2026, and the manufacturing work required to supply the phase 2B study.

Our runway currently excludes the phase 2B and phase three clinical study costs. But most importantly, we are funded for at least nine months after the expected 52-week data from the NEMAFMAB study, which is expected in Q2 2026. This concludes our prepared comments for today. Thank you very much for joining us and we'll now open the call for questions from our covering cell side analysts. Operator, over to you.

Hey, Kristin, it's been here, thanks, that's a great question and thanks for joining the call. I guess I can just kick it off just to kind of give a little bit of context here what we're trying to achieve with the extension and then hand it over to Chris. So we obviously are really excited about the extension. I mean, the decision to implement the extension a study was strategic and we're recognizing the value of a longer efficacy and safety data, which we believe is really important for this, you know, continuing to generate with the clinical trial that we have. So the idea was to have additional data for our regulatory discussions as well as for the next steps for the program.

I think it's hard to extrapolate what's exactly happening pre-clinically from the human studies, but that is also something that we're exploring where we have additional pre-clinical data. But I'll turn it over to Chris to just specifically answer the pre-clinical question.

Yeah, thanks for the question. It's a fair question. One that we're looking carefully at and so we're approaching this in a few different ways, but if we're focused only on the pre-clinical side, we really are looking at exposure, understandings within a critical analysis of a PK profile, if you will, and understanding how that exposure relates to efficacy in the DIO using weight loss and other important biomarkers associated with efficacy and looking at sort of how that timeframe in an obviously compressed sort of DIO model, how that relates to something that is more elongated such as a clinical trial. And so we're using that as sort of guideposts to help us understand the potential timing required for loss in a clinical trial.

We're also looking at some of the historic data, notably Ramana, which of course is a small molecule, a little bit different mechanism there, but still one that I think can help guide in terms of pathway. And so when you collectively look at that and we'll be certainly putting some of this data out in the future and talk more about it in 2025, but when you look at those, it's pretty evident that adding the optimal extension will allow us to reach a deeper weight loss, that's our feeling.

And to each point, we don't know exactly where that sweet spot will be, but certainly we expect based both on the preclinical exposure data that I mentioned as well as historic data to think that's gonna be as in pages and really allow us to uncouple it deeper weight loss in a better signal overall.

Yeah, in terms of the safety analysis that's ongoing here is pretty straightforward. It's an independent data safety monitoring board that meets and reviews the data and they give a go, no go on continuing the trial. So that information still is blinded to the management. And at the moment, that's all we can really ascertain from that is that there's been two independent meetings that have happened, they have been quarterly, there's another one planned in April.

And the fact that the trial has continued is the signal for that all the safety information that's been reviewed is of no concern.

Yeah, so let me just clarify that. So the whole, the point of removing the interim analysis is because the enrollment's obviously gone faster than expected. And by eliminating that, we're now having the full 26 week data on 100% of the patients. So we gain a complete data set. Obviously that's supporting our decision making, our overall regulatory discussions and all of those other things. But independent of that, I think you've implied this in the first part of your question is just about the timing of the extension study and why we may not have considered it earlier on, just to be transparent. We have always recognized the value of having a longer term efficacy and safety data readout.

So the 26 weeks was what we originally had planned, but it was also around what the drug supply that we had at the moment. So now we've also addressed that over the course of the year. So we have full drug supply and manufacturing that now supports continuing to have the commitment for extending this trial. So securing kind of the reliability and the scalability of our manufacturing has been a key part of this next decision now that we can, hey, we can extend our current trial and have the additional data points that we're looking for from weight loss and also some of the other things that we're measuring in the trial for another 26 weeks.

Thanks, Chris.

Yeah, so just to answer the first part of the question there, Ted, thanks again for joining in. So our protocol said 120 of valuable patients. And to reach that goal, we've enrolled 136. So overall, there's no change in statistics. But obviously, this translates into more robustness and efficacy and safety analysis as we have more patients. So for us, the regulatory pathway doesn't change here. It's just a larger data set. And it's just enhancing confidence for everything that we're working on, as well as all of our future interactions that we have with the agency regarding our subsequent trial.

There was a second party to your question that I need you to repeat again.

Yeah, it's a great question. So the 52-week extension results will be available in the first half of 2026. I mean, you can easily kind of do the math there. The goal here, it does allow us to engage with regulators with a more robust data set. But that doesn't really change from what we were planning to do with the 26-week top line data. So it does, I think, for us, the timelines have continued to accelerate overall for our subsequent clinical program and in terms of our regulatory interactions, our phase to be, and subsequent development efforts would all be based off of the top line data. So now that we'll have that in late Q3, early Q4, we plan to immediately engage with regulators, both FDA and EMEA for the subsequent larger studies.

Hey, Jay, thanks for joining the call. And yeah, that's a great question. We're excited about a lot of different data now that that the IO model that Chris has been working on is up and running. So I'll turn it over to Chris and he can expand on that.

Hey, Jay, thanks for the question. Yeah, we're pleased that we're really excited about the direction that our preclinical data is heading. So we're looking forward to sharing just a more robust data set, including some really nice biomarker work that touches on some of the key mechanisms, as well as differentiation around our CD1 inhibitor. So you're well aware of the safety enhancements that our approach takes when we have some other data that suggests deeper mechanistic differentiation as well. So look forward to sharing that as well as starting to touch into the combination approaches that you might imagine are relevant. So again, we're looking forward to building out and having a nice data set in the summer.

Yeah, I can just elaborate, Jay, the interesting thing for us has been that last year when we were beginning to work on all of that, we didn't have the backdrop of additional data from the small molecule, which could be one inhibitor. So obviously with that data and you know that we've spent quite a bit of effort walking the street through the PKA analysis in a side-by-side comparison.

So we've continued to build on that and even in our JP Morgan conversations, we came back and debriefed and said, okay, where are the gaps that we're having? People may be struggling with in terms of comparisons against our approach versus other CD1s in development. And that's the key thing is that our preclinical data package I think is continuing to become the most robust and the standard going forward.

The key thing we want to continue to point to is a differentiated product profile with this preclinical data. It should be informative to give confidence that there's more likely good of success here in what's translated in the clinic. The early data that we presented in November last year was the first indication of that showing that there was sufficiency of peripheral mechanism or peripheral driven weight loss. And now, you know, just enhancing that with the combo expectation ahead of our clinical data that will help to just bolster the strength of our overall pieces.

Yeah, I'll start there and I can let our chief operating officer speak to that as well. The, for us, it's been really exciting. You know, at JPMorgan, we made the comment that GLP1 space is crowded and you're going to get to see a lot more attention on the non-incredence space taking shape. Obviously, that's been led by the Kaggersema data that we saw in fall of 2024, and then Amacreden data that followed that and now two back-to-back deals that have happened in the Amalan space.

And the comment that we made in terms of all of our discussions that we had in Q1 was that Amlan and CB1 are the other two mechanisms that have gotten the most attention in terms of being validated and it's just a matter of time for CB1 to have that clearing event. For us, CB1 had that clearing event a couple times, Roman event, and it had it again with the Monlunabant data. The only issue is that the small molecules continue to have a neuropsychiatric concern. So we knew that back in 2023 when we acquired Birdrock, it's never been an issue for us. We've always built our thesis on the fact that we're going to have a CB1 that's just as competitive in the non-incredence space that doesn't have the safety concerns.

And that's been our thesis and that's what we're executing again. So for us, this new deal flow and the size of those deals is of note because it's obvious that the pharma and strategics are placing bets and they're placing big bets, like in the case of Roche, they've really expanded their footprint now. And I think they're being competitive relative to Novo and Lily, especially in the non-incredence space.

Two's been digging in a lot more on this because we've been doing a bunch of primary research, so I'll let them talk to that as well.

Yeah, thanks, Tony. Hey, Jay, thanks for the question. Yeah, I'll make this quick, but like Penny said, we've been digging in a lot with our own primary and secondary research. And I think what I will say about these last most recent deals, which certainly aligns with what we've been hearing from the KOLs is that they're less and less excited about just more GLP1 drugs and more and more excited and really asking for more and more alternative mechanisms of action that in one drive, still drives the clinically meaningful weight loss. They don't necessarily need to be 25% weight loss, but if they are more tolerable, they can be still, again, clinically meaningful and convenient for patients, then those are drugs that the physicians think have a real place in the market, not just the second line therapies, but also potentially in the first line setting as well.

So I think a lot of the farmers are starting to see that, certainly based on the deals we're seeing and that sort of needs to be secondary or these alternative mechanisms of action are gonna become more and more important in the future.

Thanks, Jay.

Yeah, Andy, thanks for those great questions. So I'm gonna actually turn it over to Dr. Aurora as everyone, if you're following, you know, Dr. Aurora joined the company at a real opportune moment. We had just begun the CBON study and thanks to his leadership has kind of immediately rolled up the sleeves on the road for three weeks and got a chance to see and get clinical sites up and running and to his credit, we've also been successful in terms of expanding and to academic centers. So I'll let him elaborate on all three of these questions. I think it's in this wheelhouse.

Yeah, thanks, Denise. So Andy, thanks for the questions. As far as the site and investigator question is concerned, you know, we've had a lot of excitement from investigators that obviously trials are popular right now. People are very motivated and enthusiastic to come into these trials and try different things that may help them. So we, you know, we're actually, we're very grateful to all the efforts that the investigators have put in and the participants have put in and that helped us to enroll at that really nice space.

We were able to activate all the sites. Finally, we did the whole vaccine, I think the eminent academic center was good for this team. Overall, we are going to be surprised, as you can see. Your next question was with relationship with to DEXA scans and opposition. And as you know, we're doing longitudinal scanning in this first 26 weeks and the final scan of that takes place at the end of that period of the study.

We will continue to measure and during the extension. So we will do a DEXA scan in the middle at 12 or 13 weeks, whatever that time point is. And then one again at the end of treatment. So we will continue that trajectory of looking at what happens to body composition through the study. Now, as far as the interim endpoint is concerned, there were some concerns about powering and how, you know, we deal with doing an interim endpoint and how that might affect the power of the final endpoint given, as you've already heard, given how close the final analysis is to what would have been the interim analysis. Now that we're not doing the interim analysis, I think those questions just simply go away.

And yes, we do, we preserve all our power to be able to do that final analysis.

Hey, George, thanks. I'll turn that over to Dr. Aurora. He might want to take both those questions. I don't know, Chris, if you want to talk about any of that from a preclinical standpoint on the second part.

Yeah, so, George, the DSMB gets all the data. We provide them with everything. We provide it in an unblinded manner. So they're able to assess everything that's going on in the study and obviously blind it. So we don't actually get that. The study does have stopping criteria, which, you know, every other study. But the DSMB by its charter has right to tell us based on what they're seeing that we need to modify the study or we need to make changes or stop the study or dozing or anything of that sort. They've done two reviews so far. They have told us that the study is fine, continue as is. So that's what we know. We're coming to another full review in April and we'll keep you all posted.

But at this point, we had no indication that the DSMB thinks that any modification of the study is needed based on what they are seeing. And they do have all data. So they are looking at all of the neuropsychiatrists and the neurological exams, et cetera. Your second question was related to neuropsychiatric effect. I mean, I guess in an absolute sense, I can't tell you what the neuropsychiatric effects are because we believe that there was CV-1 as we locked in the highest centers of the brain. But Chris can elaborate on this if you want to hear more. But we do have some really nice models that show how the neuropsychiatric effects are dependent on the concentration from the brain, not on the concentrations in the periphery.

So even after you reach full engagement in the periphery as with Monluna Band, when you increase doses at that point what's changing is the concentration in the brain and reaching the IC-90 there. And we see the rate of neuropsychiatric effects increasing. So based on those models, we do believe that this is very much a CNS effect, a not driven person.

Yeah, so the way the 52 week is designed, the extension, the monotherapy patients, which is the primary arm of the study, go to open label in the mass map. So we are crossing over the placebo as well so that everyone gets an opportunity to be on active drug which will help us to retain some patients as well.

And also give the placebo patients an opportunity. It'll give us another 26 week cohort that will go 26 weeks besides those that will get the 52 weeks of treatment. So we won't have a placebo arm in that. In the combination arm though, we are, because the combination arm is already getting an active treatment, we are able to just continue them to 52 weeks in a blinded manner. So they will continue to get the placebo.

Hey, Jonathan, thanks for joining and appreciate your patience on the call list here. The, yeah, the good news here is, obviously in overall as Dr. Laura commented in what we've seen across the board, you can evaluate other agents. Obesity studies have had a generally an uptick of interest from patients. But to the credit of the sky operation scene, the CROs involved in the clinicians that we're working with, we're also working with some really fantastic investigators. Like I mentioned earlier, investigators that have experienced what other agents experience even with Remodiment. So we're working with a few academic centers and there's been generally strong, I think follow through in terms of patient recruitment, patient interest, keeping patients kind of informed with what's going on.

And it's an alternative mechanism too, right? So the challenge you have with the most of the larger VLP1 studies is that a lot of patients did discontinue and there's issues regarding tolerability. Here, you're offering an alternative mechanism and keep in mind, we also had an arm that had a combination with TLP1. So it's a combination of factors that I think alongside of some good recruitment tactics that the team implored to get that done.

Great. So I'll turn it over to two to talk about from GMP manufacturing and the steps that we've taken there. And then probably Dr. Ora or Chris, you guys can both answer the diabetic question.

Yeah, thanks. So in terms of your question around monthly dosing, you know, we think it's important. I think where it becomes important for a patient, we think it's for help with a sort of convenience and potentially compliance where it helps with the sky is it certainly helps with from a cog's cost of goods perspective. So, but ultimately, again, I mentioned earlier that we did do a KLL, happened doing KLL primary research.

And those KLLs actually made pretty clear that, you know, weekly dosing is really, you know, quite acceptable for them and for patients as well. So from my TTPs perspective, you know, if we landed on a weekly dosing, we don't think that's gonna be a major sort of deterrence or hit on the target profile. But if we are able to get to monthly dosing, then it certainly would be beneficial from cost perspective for the company and probably would provide some additional convenience, but you don't think it's a major deterrent.

Yeah, just the manufacturing process, we haven't really spent much time speaking about that. But as you've seen in the press release today, we've now begun to discuss that and be transparent that our TMP manufacturing process for NEMASM is well underway. And we're really proud of, you know, the work that the two and his entire team has been working on. So that's including process optimization, you know, ensuring that's the best consistency and then just preparing for a larger scale production. So we don't feel, you know, we have any challenges to meet the demands that we expect for the subsequent regulatory studies and then ultimately for commercialization work, we're doing it really, I think elegantly in terms of how to scale up and doing it responsibly from a capital allocation standpoint.

There was a question regarding just about the type two diabetes population. So I think maybe Dr. Roy, you're probably more informed on how that mechanism is a play and I don't know if Chris, you want to talk about it from a preclinical standpoint.

Yeah, we're very excited to, you know, move forward and be able to test in the people with diabetes. Well, we know that part of the mechanism of action is insulin sensitivity. And so that, you know, that plays a big role in the treatment of type two diabetes. Of course, the weight loss itself and the fact that the action is an adipose tissue and is anti-inflammatory. So there's a whole lot of different things which may play really well with diabetics. And anecdotally, we've heard from, you know, our partners in KOLs in Europe, that when they use Ramonoban, they were quite pleased with how it worked with diabetics. So, you know, it's just an interesting nugget out there that creates even more interest for us.

We will definitely be testing this in diabetics. I think once we have proof of mechanism and they're moving forward, we will plan how to do a study in people with diabetes as well.

I just had briefly on the preclinical side, we are seeing some really interesting, and this is in not necessarily a diabetic model, but in some of the DIO look we're doing, some of those fibrotic immune pathways that are very much relevant to patients with diabetes, modulating the right way. And so, you know, whether or not it's a focused study directly or predicting about potential comorbidities or those pre-diabetics that are built as pathway, mechanistically, things that have touched in a very productive fashion on some of those pathways. So, that's a very nice detail regarding the CD-1 inhibition.

Yeah, thanks, Albert. Thanks for staying on the call and following through this question. The moment we haven't spelled out all of the updates regarding the complete design for now, what we've stated is we're extending all of the arms. From 26 weeks to 52 weeks.

So, stay tuned for additional kind of data in terms of anything else we might explore in those in the added 26 weeks. The other, what was the other part of your question?

Yeah, there will be some rules to complete what you were asking. There will be a 13 week follow-up after the 32 week extension too, for those who roll over.

Yeah.

Yeah, it's great, it's a billion dollar question that you're asking, and unfortunately, we don't have any data on that at this point in time. But the goal here is for the 26 weeks is to show that 8%. And we will also have now indication from the extension study how patients are doing on the longer time point. So, at the 26 week time point, I hope that we are going to be able to see, you know, the curves continuing to show deeper weight loss with the mechanism. Now, to point to other CB1 inhibition data, namely Ramonament, that was the case. And we expect to be just as competitive here with the peripheral driven approach that we have.

So, I think it's still, that's still pending. And I don't want to speculate on anything other than what we've already kind of designed in our current program.