© 2024 Alpha Spread Limited. All Rights Reserved.
www.alphaspread.com is not operated by a broker, a dealer, or a registered investment adviser. Under no circumstances does any information posted on www.alphaspread.com represent a recommendation to buy or sell a security. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. In no event shall Alpha Spread Limited be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on www.alphaspread.com, or relating to the use of, or inability to use, www.alphaspread.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. Past performance is a poor indicator of future performance.
You don't have any saved screeners yet
Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Greetings. Welcome to the Crinetics Pharmaceuticals, Inc. 2021 Clinical Strategy and 2020 Financial Results Conference Call. [Operator Instructions].
I will now turn the conference over to your host, Corey Davis. You may begin.
Thanks, Alex, and thank you all for participating in today's conference call. Before we start, I'd like to point out there is a slide deck that is going to accompany today's presentation. The deck can be viewed using the webcast link provided on the Investor page of the Crinetics website. Also posted on this web page is a news release issued earlier today, announcing Crinetics' 2021 clinical plans and fourth quarter and full year 2020 financial results.
I'd like to remind everyone listening that some of the information contained in the news release and on this call is covered under the safe harbor provisions of the Private Securities Litigation Reform Act and contains forward-looking statements based on current expectations, including statements about the initiation of planned clinical trials. Such forward-looking statements are not a guarantee of performance, and the company's actual results could differ materially from those stated or implied in such statements due to the risks and uncertainties associated with the company's business. These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's news release, the company's other news releases, and Crinetics' SEC filings including on its annual report Form 10-K.
I'd also like to point out that the content of this call contains time-sensitive information that is accurate only as of the date of broadcast, March 30, 2021. Crinetics takes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call.
With that, I'd like to turn it over to DScott Struthers, Founder and CEO of Crinetics. Scott, go ahead.
Thanks, Corey, and thanks to all of you listening this afternoon. I'm joined today by Dr. Alan Krasner, our Chief Medical Officer; and Marc Wilson, our Chief Financial Officer. Although we're reporting our 2020 fourth quarter and year-end financial results, the primary purpose of hosting today's call is to provide some additional color on our development strategy and our clinical programs for what we believe will continue to be an exciting year for Crinetics.
Now before we get into what we have in store for the balance of the year, I'd like to first touch on some of the recent accomplishments that have set us up for success. Last October, we reported positive Phase II data in acromegaly patients demonstrating that once-daily oral paltusotine allowed patients to maintain their IGF-1 levels when switching from the current standard of care, which are injected octreotide and lanreotide depot therapies. This represented a significant accomplishment as IGF-1 is the biomarker used by physicians to manage acromegaly patients around the world. Once we became comfortable that patients could effectively and seamlessly switch from injectable to our once-a-day oral pill, we approached the FDA and other regulators in order to design a robust Phase III program to support our goal to obtain a broad label and position paltusotine as a differentiated product with a competitive advantage. Following these data and a recent productive meeting with the FDA, we are now advancing paltusotine into a Phase III program. Alan will walk you through that design in a moment.
We also recently expanded our clinical stage pipeline advancing CRN04894 and CRN04777 in the Phase I clinical trial. As a reminder, 4894 is an investigational oral ACTH antagonist being developed for Cushing's disease and congenital adrenal hyperplasia, while 4777 is an investigational oral SST5 agonist being developed for congenital hyperinsulinism. It's worth noting that just as was the case for paltusotine, many products in endocrinology can be derisked early in clinical development if the use of biomarkers can be predictive of clinical success in later trials. Many of these key biomarkers have also been accepted as primary end points in registrational trials. Therefore, these 2 Phase I endocrine programs have the potential to provide more meaningful outcomes than traditionally found in other therapeutic areas of drug development.
These clinical accomplishments were also complemented by the achievement of key regulatory milestones as the U.S. FDA granted paltusotine an Orphan Drug Designation for the treatment of acromegaly. And CRN04777 received a rare pediatric disease designation for the treatment of congenital hyperinsulinism.
Collectively, the advancements of our clinical pipeline have left us poised to solidify our position as a leader in the de novo design and development of novel small molecule drugs for endocrine diseases. We're also well positioned financially as we ended 2020 with over $170 million in cash and investments. Based on our current expectations and in line with previous guidance, this will provide us funding into 2023.
Now I'd like to preview Alan's section of the call by giving a high-level overview of our Phase III acromegaly program for paltusotine, which we have now named PATHFNDR. PATHFNDR program, which was developed on -- based on feedback from a recently completed meeting with the FDA as well as interactions with other regulators, consists of 2 well-controlled Phase III trials that we believe could support paltusotine's approval in the U.S. and European Union. These 2 independent placebo-controlled pivotal trials are intended to support a broad label for paltusotine that we believe would allow for its use as both a first-line medical therapy and support seamless switching for patients currently on injectables and looking for a more convenient, less painful alternative.
In support of this goal, our Phase III trials will enroll a broad cross-section of acromegaly patients. Both studies will be placebo-controlled, and the primary end point for both studies is the proportion of patients who are responders achieving biochemical control. Regulators define a responder as a patient whose IGF levels are at or below 1x the upper limit of normal.
The first of these trials, PATHFNDR-1, focuses on patients switching from the current standard of care and will enroll patients who are already biochemically controlled on injectable octreotide or lanreotide . Our second Phase III trial, PATHFNDR-2, focuses on untreated patients who are biochemically uncontrolled, meaning their IGF levels are above 1x the upper limit of normal. Together, if successful, we believe these trials could support registration of paltusotine in the U.S. and EU for all acromegaly patients who require pharmacotherapy, including both untreated patients and those switching from standard of care, regardless of whether they have been biochemically controlled on these prior therapies. This would best position paltusotine to take advantage of the acromegaly market opportunity and most importantly, increase the number of acromegaly patients who would stand to benefit from the advantages of paltusotine's once-daily oral dosing.
With that, I'll now hand the call over to our Chief Medical Officer, Dr. Alan Krasner, who will dive into the details of the PATHFNDR-1 and 2 study design. Alan?
Thank you, Scott, and good afternoon, everyone. I'd like to start by describing the design of the PATHFNDR-1 study on Slide 5. It was designed based on feedback from the FDA and other regulators and mirrors the design of other recently approved products for acromegaly in the U.S. As Scott mentioned, PATHFNDR-1 will enroll patients who are biochemically controlled on octreotide or lanreotide depot monotherapy. Target enrollment for this study is 52 patients.
These patients will remain on their injected depot monotherapy through a 1- to 3-month screening period, during which time we will establish baseline values for parameters such as IGF-1 growth hormone and total acromegaly symptoms diary score. After completing the screening period, patients will be randomized to receive once-daily oral doses of paltusotine or placebo. IGF-1 assessments will be conducted each month throughout the study's 9-month treatment period. Patients randomized to paltusotine will start at a 40-milligram per day dose.
If during months 2 to 6, a patient's IGF-1 level rises above 0.9x the upper limit of normal, that patient's dose will be increased to 60 milligrams as some patients may need a higher dose. Alternatively, the dose can be decreased in 20-milligram decrements if necessary for tolerability reasons. Patients will then be maintained on the dose that was established during the first 6 months of the treatment period. An average of the 3 IGF-1 assessments measured at weeks 32, 34 and 36 will serve to determine IGF-1 responder status.
The primary end point of PATHFNDR-1 is a responder analysis comparing the percentage of control patients in the active arm to those in the placebo arm. For statistical success, paltusotine needs to demonstrate superiority to placebo in this responder analysis in order to meet the primary objective. This study is over 90% powered to do this.
Because this is a placebo-controlled trial, procedures are in place to rescue patients with standard injection therapy, if necessary. Patients who have 2 consecutive IGF-1 measurements above 1.3x the upper limit of normal, plus an exacerbation of acromegaly clinical symptoms while on the maximal dose, will receive rescue therapy. Patients require rescue therapy are counted as nonresponders.
Looking ahead, we expect to initiate PATHFNDR-1 in the second quarter of the year, in line with previous guidance for our Phase III program. Top line data from this study is expected in 2023, and the study will be followed by an open-label extension for eligible patients.
I'll now shift gears a bit to Slide 6 and speak about our PATHFNDR-2 study, which has been designed to enable paltusotine use in untreated biochemically uncontrolled patients. This study will enroll medication-naive patients or patients who have not received medication in the previous 4 months as well as patients receiving octreotide who agreed to washout under supervision to demonstrate a rise in IGF-1 above the upper limit of normal. Target enrollment for the study is 74 patients.
As in PATHFNDR-1, baseline values of IGF-1 will be established during the screening period. However, the PATHFNDR-2 population will consist of patients with elevated IGF-1 levels initiating treatment, whereas PATHFNDR-1 will consist of those with normal IGF levels on treatment who switched their treatment to paltusotine. The combination of these 2 studies will capture the spectrum of acromegaly patients who require medical therapy.
After completing the screening period, PATHFNDR-2 patients will be randomized to receive once-daily oral doses of paltusotine or placebo. IGF-1 assessments will be scheduled periodically throughout the study's planned 12-week treatment period. The study's primary end point is a responder analysis based on the mean IGF-1 measurements at weeks 10 and 12 comparing paltusotine to placebo. As in PATHFNDR-1, the target dose range for patients in this study will be 40 to 60 milligrams per day. Rescue criteria will also be in place for this study. While we are still finalizing the rescue criteria for PATHFNDR-2, we can say that they will be also based on IGF-1 levels and clinical acromegaly symptoms.
Looking ahead, we expect to initiate PATHFNDR-2 in the second half of the year, with top line data also expected in 2023. As in the case with PATHFNDR-1, we expect the trial to have statistical power greater than 90%, and eligible patients will have the option to participate in an open-label extension study.
Now that we have walked through the design of our Phase III program in detail, I'd like to take a step back and give a high-level summary on Slide 7 of what's next for paltusotine. As I mentioned, we expect to initiate both of the PATHFNDR studies this year, with PATHFNDR-1 to begin in the second quarter and PATHFNDR-2 expected to begin in the second half of 2021. We also plan to initiate a Phase II trial evaluating paltusotine as a treatment for patients with neuroendocrine tumors or NETs complicated by carcinoid syndrome in 2021. The positive data we've generated to date in our acromegaly trials gives us confidence in this program, because the same octreotide and lanreotide depots currently used to treat acromegaly are also used to treat NETs.
Looking a bit further down the road, we expect to report top line data from our PATHFNDR-1 and -2 studies in 2023. I'd like now to review our fundamental goals in both Phase III studies.
Our PATHFNDR trials will be deemed a success if they demonstrate paltusotine's ability to outperform placebo in a responder analysis. Given the pharmacologic activity demonstrated by paltusotine in our Phase I and II studies, we are confident we can meet this goal, which we believe will support approval in the U.S. and European Union. I'd also like to remind you that we are targeting a broad label with these studies as we hope paltusotine will be accessible both as a first-line pharmacotherapy and as an alternative to burdensome octreotide or lanreotide injections.
Now before I hand it off to Marc to summarize our recent financial results, I'd like to talk briefly about our plans for 4894 and 4777 programs. Let me first start on Slide 8 by saying that our approach to endocrinology provides the opportunity to explore the safety and efficacy of drug candidates early in the development process. The beauty of drug development in endocrinology is its ability to translate from preclinical to patient studies. Endocrine systems are similar between mammals, and we can study the pharmacology of drug candidates on hormone levels in animal models and in healthy volunteers in a way that provides meaningful proof of concept and dose selection guidance for later clinical studies in patients.
Our plan for the Phase I studies with 4894 and 4777 is analogous to what we did in our initial Phase I healthy volunteer study of paltusotine, which provided important early information for that program. In these Phase I studies, we will of course evaluate safety, tolerability and pharmacokinetics. But in addition to this, we aim to understand the pharmacodynamic effects on relevant hormone levels to give us a strong sense of the molecule's pharmacology and potency to produce the desired therapeutic effects in patients.
As some of you may know, CRN04894 is an investigational oral nonpeptide ACTH antagonist that we are developing for Cushing's disease and congenital adrenal hyperplasia or CAH. It entered a Phase I trial pictured on Slide 9 in healthy volunteers earlier this year, and we expect to report preliminary data from the single ascending dose portion of the study by the end of June, with data from the multiple ascending dose portion coming in the second half of the year.
While it is typical for Phase 1 trials to assess safety, tolerability and pharmacokinetics, we expect this study to provide added value by establishing clinical proof of concept for 4894 in CAH and Cushing's disease. We are able to do this by measuring hormonal biomarkers used in our animal model studies, which are the same hormones that endocrinologists measure every day in practice. These hormones are also key end points that regulators use to evaluate new drugs for approval in these conditions.
Both CAH and Cushing's disease are characterized by excess ACTH secretion, which results in adrenal gland oversecretion of adrenal androgens in the case of CAH or cortisol in the case of Cushing's disease. Both adrenal androgens and cortisol can be readily measured in healthy volunteers and in patients.
In our ongoing Phase I study, we are evaluating the ability of 4894 to block the action of ACTH on the adrenal glands, which should be predictive of the molecule's efficacy. To make this assessment, we are administering ACTH to healthy volunteers and measuring levels of cortisol in the blood. This is a well-established technique to assess adrenal function that has been used by endocrinologists for many years.
Now if I can turn your attention to the diagram on the right side of the slide, I'll briefly explain how we are adapting this technique to explore the pharmacology of 4894. On day minus 1, a healthy volunteer receives an injection of ACTH. We then take blood draws 30, 60 and 120 minutes later to see how cortisol output from the adrenals respond to the ACTH injection. The next day, we treat study participants with oral 4894, repeat the ACTH stimulation, and again measure blood cortisol levels to determine how 4894 affects the adrenal response.
Upon the completion of this study, what we are hoping to see is dose-dependent suppression of ACTH-stimulated peak cortisol with 4894. This would provide clinical proof of concept in both Cushing's disease and CAH, which in turn derisks the clinical program. Such data will also provide insights into therapeutically relevant doses of 4894, which will be useful when designing subsequent studies in patients.
I'll now shift gears again to Slide 10 and talk about CRN04777, our investigational oral nonpeptide SST5 agonist being developed as a treatment for congenital hyperinsulinism or congenital HI. Like the 4894 Phase I trial I just described, the 4777 Phase I study is designed to assess safety, tolerability and pharmacokinetics as well as to provide early clinical proof of concept in relevant indication. Once again, we are able to do this in Phase I because we are developing a drug for an indication with well-established biology and blood-based biomarkers.
As the name implies, congenital hyperinsulinism is caused by excess insulin secretion even in the face of low blood glucose levels, which can lead to dangerous hypoglycemic episodes. In our ongoing Phase I study, we are evaluating the ability of 4777 to reduce insulin secretion, which should be predictive of efficacy in congenital HI. I should emphasize here that 4777 is designed to act at the SST5 receptor, which is independent of many of the mutations that cause congenital HI. This is significant as it should allow 4777 to be broadly applicable to congenital HI patients with various underlying mutations.
Turning our attention now to the right side of this slide. You can see that we are utilizing 2 separate techniques to explore the pharmacology of 4777. The first technique is an intravenous glucose tolerance test. The premise for this test is relatively simple: administration of exogenous glucose stimulates the secretion of endogenous insulin. So to evaluate the ability of 4777 to suppress insulin secretion, we take healthy volunteers and infuse them intravenously with a bolus of glucose on day minus 1, and then measure insulin and blood glucose changes that result from the glucose injection. The next day, we treat study participants with oral 4777, repeat the intravenous glucose administration, and again measure insulin and glucose responses to determine if 4777 is able to reduce insulin secretion.
The second technique being employed in this Phase I trial is a sulfonylurea challenge test. Sulfonylureas are a well-known class of diabetes drug that stimulate insulin secretion. The use of sulfonylureas can pharmacologically mimic the most common mutations that are found in about half of congenital HI patients. Thus, sulfonylureas are a useful tool to evaluate 4777's pharmacologic activity.
As you can see in the diagram on the bottom right of the slide, we plan to first administer a sulfonylurea to healthy volunteers, and then measure their levels of insulin and glucose for a period of 9 hours. During this time, participants will receive intravenous glucose as needed, in order to prevent the sulfonylurea from causing low blood glucose levels or hypoglycemia. This precise infusion of glucose is referred to as a glucose clamp technique, because the subject's glucose level is being clamped in the normal range. The amount of IV glucose required to keep the subject's glucose level normal is a quantitative measure of the sulfonylurea effect.
1 or 2 days later, participants will again receive a sulfonylurea while on a glucose clamp. An hour after receiving the sulfonylurea, participants will then be given oral 4777. Insulin and other blood-based biomarkers will again be assessed for a 9-hour period. 4777 is expected to reduce insulin secretion in response to IV glucose or a sulfonylurea challenge, which for the patient could mean fewer episodes of debilitating hypoglycemia. Demonstrating this would significantly derisk this clinical program, while also providing valuable dosing information to aid in the design of subsequent studies in patients.
With that, I'll turn the call over to Marc Wilson, our Chief Financial Officer, to discuss our financial results for the fourth quarter and full year 2020. Marc?
Thanks, Alan, and good afternoon, everyone. I'm pleased to report that in 2020, Crinetics was able to maintain a strong financial position, while making significant advancements in its clinical and drug discovery programs. Our unrestricted cash, cash equivalents and investments improved to $170.9 million at the end of 2020 compared to $118.4 million at the end of 2019. Based on our current expectations, our financial runway extends into 2023, through the anticipated top line data readouts from the paltusotine PATHFNDR studies.
As of February 28, 2021, the company had roughly 33 million common shares outstanding. Total operating expenses for the fourth quarter and full year 2020 were approximately $21.8 million and $75 million, respectively. This represented an increase over total operating expenses for the same periods in 2019, which were $15.5 million and $55 million, respectively.
Research and development expenses for the fourth quarter and full year 2020 were $16.8 million and $57 million, respectively, compared to $12.1 million and $41.5 million for the same periods in 2019. Increases in R&D spend were primarily attributable to clinical development and manufacturing activities for paltusotine as well as progress in the company's preclinical programs.
General and administrative expenses also increased for the fourth quarter and full year 2020, growing from $3.4 million and $13.5 million in 2019 to $5 million and $18 million for the same periods in 2020. These increases were primarily due to personnel costs to support the company's growth.
Finally, net loss for the fourth quarter of 2020 was $21.6 million compared to a net loss of $14.5 million for the same period in 2019. For the full year 2020, the company's net loss was $73.8 million compared to a net loss of $50.4 million for the full year 2019.
And with that, I'll hand it back to Scott.
Thanks, Marc. Before we open the line for questions, I'd like to take a moment to recognize all our employees, investigators, site staff and patients around the world. Thanks to their talent and dedication amid the pandemic, we have gone from a company that had a single clinical-stage asset to one with an active pipeline of 3 clinical programs, with more on the way from discovery.
As you can see on the table on this slide, this progress has left us poised to achieve a steady cadence of milestones over the coming months. By the end of the year, we expect to have initiated both Phase III PATHFNDR studies as well as the Phase II trial evaluating paltusotine in patients with NETs complicated by carcinoid syndrome. We also expect to have established proof of concept for our 4894 and 4777 programs, as our Phase I trials will assess the ability of these candidates to modulate the relative peptide hormone receptors in healthy volunteers. This should be highly predictive of efficacy in patients.
This early stage derisking strategy has been validated by our paltusotine program, which was the driving force behind our IPO a few years ago and was executed at the time when paltusotine has completed its first Phase I healthy volunteer study. Collectively, we expect the execution of our clinical milestones to solidify our position as a leader in the field of endocrinology. We look forward to the year ahead and remain committed to working to improve the lives of our patients.
With that, I'd like to thank everyone for joining our call today. We'll now open the call to questions, and I'll ask the operator to moderate them.
[Operator Instructions]. Our first question is from Charles Duncan with Cantor Fitzgerald.
Congrats, Scott and team, to a good year of progress. Really like the slides, they're very well organized, so definitely appreciate all the detail. First question, though, is timelines to data, data in '23. I mean, very well-organized program for PATHFNDR in Phase III. And I guess I'm wondering what do you anticipate to be the biggest rate-limiting step? Will it be enrollment or identification of the best patients for this trial, appropriate patients for the trial? What is really governing that '23 timeline?
Thanks, Chaz. I appreciate the question. Maybe I'll take that one. And Alan, jump in if you think I'm missing anything. But patient enrollment is always a challenge in rare disease studies, but we've learned a lot from our Phase II program. And we've implemented a range of things to enhance enrollment, not the least of which is letting patients and their investigators know that this drug can switch patients who are on standard of care to paltusotine without loss of IGF-1 control. So that's huge.
The other thing is that we'll be using centers all around the world to conduct this study. Probably with these studies, approximately 100 different centers in multiple different countries. So it's always a challenge. We're going to be working hard on site activations and patient recruitment through multiple mechanisms, but we're pretty confident in that forecast for 2023. Alan, did you want to add anything?
No, I agree with that very much, Scott. I also want to remind everyone that these studies have open-label extension periods, both of them. And that is always -- that always helps with recruitment, particularly in the rare disease state, particularly in studies which are placebo-controlled. All patients who are eligible and complete the trials would have an opportunity to potentially enroll in the OLE.
Okay, and then if I may, a follow-up. It seems like stat sig relative to placebo, certainly in PATHFNDR-1, is relatively low bar. But I guess I'm wondering beyond statistical significance, what kind of response rate would you like to see in terms of clinically significant results out of that PATHFNDR study?
Alan, do you want to take that?
Sure. Well, so the end point is designed to be inherently clinically significant. And this is the preferred end point from the FDA and regulatory community, that is percentage of patients with normal IGF-1. So showing as a increased responder rate that is significant in patients who normalize their IGF-1 is inherently clinically significant, and we know that is the preferred approach from the regulators.
Okay. Maybe I'll just add to that, that we've shown in Phase II that paltusotine can achieve levels of IGF-1 that are equivalent or on par with those obtained with current standard of care. So in PATHFNDR-1 where we're starting with patients already on injectable that are controlled, we would expect very high levels of responses -- responders, so 70%-plus. In naive patients or patients not on therapy, that might be substantially lower as it's been shown for the peptides. So we'd expect those to be down around 1/3, as we previously discussed for patients who are new to somatostatin analog therapy.
That's helpful, Scott. Last question, moving on to the earlier pipeline, 4894 and 4777. Using the stim test in human volunteers, I get that endocrinology or endocrine systems are fairly well, I guess, conserved. I'm wondering could you anticipate using a stimulation test when you move into patients to identify patients who may be responders and perhaps use that as an enrichment marker?
Alan, do you want to...
I think that's possible, Chaz. I mean that's something that we would evaluate after having seen Phase I healthy volunteer data. It certainly is intriguing to think of it as a companion sort of diagnostic. The only thing I would say, though, is sort of we know that the -- we know sort of the ultimate markers that need to be controlled in these disease states. And in addition to showing the kinds of stimulation results where we hope to show in Phase I, we'll need to show, for example in Cushing's disease, that the overall cortisol output is reduced. Usually, this is measured using urine free cortisol collections. So we'll be looking at a large host of markers, including cortisol output and stimulation type results.
Okay.
But maybe if I can take -- thanks, Chaz, but maybe if I can just add a little bit to Alan's comment. I don't actually think it's going to be necessary to enrich patients in either congenital adrenal hyperplasia or in Cushing's disease. We know in both cases that the patients are all responsive at the level of the adrenal to ACTH. And therefore, blocking ACTH should lower adrenal steroid levels for any patient with that disease. So I don't think we need to worry much about enrichment. We just need to get this drug into patients at the doses that we figure out here in this Phase I study.
Our next question is from Tyler Van Buren with Piper Sandler.
Thanks for all the updates. I have questions on a couple of topics. I guess PATHFNDR-1 is kind of as expected, maybe some pushes and pulls relative to some other trials. The dose titration up to 60 mg should ensure that you have a lot of patients controlled. But I guess I wanted to ask about PATHFNDR-2. I guess why haven't -- why didn't your closest competitor do a similar trial for approval or for the label? Is that because maybe you think that they were unsure if they were going to be able to get the same level of control of standard of care, or maybe that it would be more difficult to enroll these patients? And is there anything about the study that would make it easier to enroll maybe the shorter 12-week time period?
And then the second is why didn't you do a PATHFNDR-3 looking at uncontrolled treatment-experienced patients like ACROBAT, as if I'm not mistaken, if I'm not mixing those two up.
Let me -- thanks, Tyler. Let me take a shot at that. So PATHFNDR-2, the whole point about that is to make sure that we don't have a requirement in the label that says patients need to have tried or responded to the injectable therapies before they could use paltusotine. So that's why we study the treatment-naive or untreated patients. I mean why put some poor patient through an unnecessary round of injectable therapy, instead of just putting them immediately on paltusotine once they're first diagnosed and ready for medical therapy. So that was the motivation behind PATHFNDR-2.
Now PATHFNDR-3, -4, -5, I think -2 is enough for now. In particular, we've already shown in Phase II that in those patients on medical therapy that had not achieved normal, that we could keep their IGF levels the same as the standard of care. So I consider that box already checked.
But I do think as part of our commercial effort in a couple of years, we may do additional Phase IV-type studies to help flesh out the label, provide guidance on usage in combination with other therapies, for example. And excited for the long time we have to spend with this molecule. Because remember, we've still got patent coverage out to the 2040s. So we're going to invest in getting the best possible label, best possible guidance to physicians and patients in this molecule.
Our next question is from Joseph Schwartz with SVB Leerink.
I'm Joori dialing in for Joe. I was just wondering if you could just dig a little bit deeper on your PATHFNDR-2 trial duration. I was just wondering where the 2 weeks -- where that came from. And also, do you think that's enough to capture the efficacy of paltusotine in treatment-naive patients?
Joori, thank you. Alan, why don't you answer that question?
Yes. I just want to clarify the trial duration for PATHFNDR-2, the treatment duration is three months. And yes, it's adequate time for paltusotine to reach a steady state and for the IGF-1 response to paltusotine to reach a steady state. This is evidenced from both our Phase I and Phase II data to date. These are patients who are untreated and start out with high IGF-1 levels. It's a placebo-controlled trial. So it's appropriate to limit the duration to that, which is necessary to show the treatment effect. Three months is very reasonable for that purpose.
Okay. Great. Thanks for clarifying that.
Yes. And as a reminder, they will all also be eligible -- they should be eligible for an open-label extension to provide additional data on long-term durability of response and safety. And that's true for all our both Phase II and Phase III studies.
Okay. And then I was just wondering if you could just help set expectations with your new formulation that can be dosed twice as high. How are you thinking about this translating to efficacy in your Phase III? Are you expecting it could be higher? Or like what percentage of your patients do you think you're going to have to get to the higher dose to get meaningful efficacy?
Yes, so in our Phase II program, we showed that 40 milligrams should be adequate for the majority of patients. But we added 60 milligrams just for those patients, which we expect to be a smaller proportion, that may need a little higher exposure levels or weren't getting the full exposure they needed out of 40 for one reason or another. So again, the goal is to provide adequate coverage for all the patients in the study.
Our next question is from Douglas Tsao with H.C. Wainwright.
Just I know after the Phase II data, there was some discussion about potentially using, I think, going up to an 80-milligram dose. I'm just curious why ultimately you sort of settled on 60.
And also, I think with PATHFNDR-1, I think I saw that you're going to measure the primary end point on -- at three time points. But in PATHFNDR-2, it looked like there's only maybe two end points. So I'm just curious why you're sort of using those two different sort of benchmarks, if you will.
Thanks, Doug. Alan, do you want to answer that?
Sure. On the latter question, so the PATHFNDR-2 study is a shorter treatment period, shorter periods of the final dose stabilization period. So we're sort of more limited in terms of our time frame there. And generally, 2 or 3 to constitute an average IGF-1 is adequate in this kind of setting. And I'm sorry, what was your first question, Doug?
Just in terms of the dosing that you did, I think there was some conversation about testing higher doses after the first studies. And it doesn't sound like you've -- and I think sort of maybe the 80 was even -- even potentially going to an 80 milligram. And obviously, it doesn't seem like you're going there. So just curious about what was sort of the decision for you in terms of coming to that decision, in reaching that.
Yes, so this is all based on dose response and exposure response modeling work that's been done and shared with the FDA. And we really believe that as Scott mentioned, 40 milligrams should cover the vast majority of patients and only a small number of outlier patients with the increased exposure. And 60 milligrams should cover that degree of exposure needed in that setting according to the modeling.
Okay. And then just one final question, just typically when you have an untreated patient going on to an injectable therapy, typically how long does it take for them to reach biochemical control?
Well, so typically, you would give -- typically, the long-acting injections are given once per month. And so typically, to reach steady state, you would wait to assess the full effect after three injections or about three months in clinical practice.
In the case of paltusotine, which is a much more rapidly absorbed agent and taken on a daily basis, the time to steady-state effect and PK would be much shorter than that.
And presumably, along those lines, just given your ability to dose titrate much quicker should give you a much longer window than what you typically see with an injectable?
A much longer window to assess...
Or not -- or you have more -- relative to that 3-month period end point, to reach sort of your optimal steady state, if you will. Does that make sense?
Yes.
Although I would say, almost -- this is not exactly what one would traditionally mean by dose titration. Because we're starting at a dose that we expect to be efficacious for the vast majority of the patients, and then we just offer a higher dose just in case for those patients who might need a little bit more. So it's not really dose titration. We're just trying to hit it with the right dose the first time, and then we have a backup plan in case it's not quite enough.
And Scott, why was the decision to start with 40 and not potentially, sort of, just given how quickly you can pivot, start with 20 and then move to 40?
Well, there's just no reason to -- I'm thinking ahead to when this is on the market. And there's really no reason for patients to risk a period of lack of control. So we start directly with 40.
Now there is a nuance in PATHFNDR-2, where we have a brief period where they have a starting dose of 20 milligrams and then they go to 40. And that's simply because in patients who are new to somatostatin analogs, they tend to have some GI side effects the first week or two of therapy. And so we just wanted to give them a little more gentle introduction to the drug.
Our final question is from Daniel Wolle with JPMorgan.
This is Daniel for Jessica Fye. First, starting maybe with PATHFNDR-1. Is there a washout period after the screening period right before the 9-month treatment period is initiated?
Hi, Daniel. You want to answer that, Alan?
No, no, these are patients in PATHFNDR-1 who are on octreotide or lanreotide. And we screen them, and we find that they have a normal IGF-1. And then they randomize to paltusotine versus placebo at the time they're due for their next injection.
So no, there's no washout involved in PATHFNDR-1 initially. But this is a 9-month study. And during that period, their preexisting injections will washout as the paltusotine is taking over control of IGF-1.
Got it. Okay. And then regarding the rescue criteria definition, is it dependent on the two consecutive IGF-1 greater than equal to 1.3x upper limit of normal and exasperation of symptoms? Or is it just failure on the 2 consecutive IGF-1 scores?
It's based on both IGF-1 and symptoms. And this is a precedented criterion used previously for the most recent acromegaly drug approval. So we do know this is a successful way to manage patients safely through these kinds of placebo-controlled trials.
Okay. And then for PATHFNDR-2, given that these patients are not well controlled, does it make sense to go against placebo? Why not an active agent in the control arm to create a stronger efficacy profile for paltusotine?
Well, we do expect them -- you see, these are untreated patients. So once they're treated with paltusotine, we do expect them to achieve control. I would say that in terms of why is it a placebo controlled, well, it's clear that placebo-controlled studies give -- are simpler designs that help the regulators assess safety more accurately related to drug. We do know that the regulators, particularly the FDA, are more comfortable with placebo-controlled design trials.
This kind of trial in this kind of patient population is also a precedented Phase III trial for another approved acromegaly product. So we think scientifically, it's the most rigorous. It will give us the clear answers we need in a reasonable period of time, and we know it is most acceptable to the regulators.
But I'd also add, Daniel, that we've got a great deal of baseline control data already with the ACROBAT EDGE study. And we'll be having in PATHFNDR-1 baseline control data to compare with paltusotine as well. So there'll be plenty of active control comparison, just not a head to head in these current studies.
Got it. Okay. And the last one, what's the rationale for PATHFNDR's -- sorry, that has been answered. But the other question is given the shorter duration of treatment period for PATHFNDR-2, how come data is still reading out in 2023 along with PATHFNDR-1, which has a longer treatment period?
Well, studies are always controlled by a mix of recruitment rates and treatment periods. We did pretty extensive feasibility on both studies at sites around the world. So that's why we started PATHFNDR-1 first. The treatment period is a little bit longer. And in PATHFNDR-2, it's a little shorter. So that's why we expect them to finish at about the same time.
Thank you. We have reached the end of the question-and-answer session, and I will now turn the call over to DScott Struthers for closing comments.
Thank you, everyone. I just want to thank you one more time for joining us on the call. And we look forward to continuing the advancement of our clinical and discovery programs. We'll keep everyone updated along the way as best as we can. And have a safe spring. Thank you.
This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation, and have a great day.