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Good afternoon, everyone, and welcome to the Arrowhead Pharmaceuticals virtual R&D webinar.

[Operator Instructions] As a reminder, this call is being recorded, and a replay will be made available on the Arrowhead website following the conclusion of the event. I'd now like to turn the call over to Vince Anzalone, Senior Vice President of Finance and Investor Relations at Arrowhead Pharmaceuticals. Please go ahead, Vince.

Thank you, Tara, and thanks, everybody, for joining us today to discuss the ARO-MAPT interim results from the Phase I/II study and the first results with our new TRiM delivery system for CNS. Really excited about these data. So just before we start, I just want to make sure everybody knows, we will be making forward-looking statements today, so I refer to all the risk factors in our SEC filings.

And here's the flow of the day. I'm going to give a quick introduction, our CEO, Chris Anzalone will talk about how this kind of ushers in a new era for RNAi therapeutics in the brain. Dr. Adam Boxer from UCSF will talk about the role of tau in Alzheimer's disease and other primary tauopathies. James Hamilton, Arrowhead's Head of R&D and Chief Medical Officer, who'll talk about the development of the new TRiM CNS subcu delivery platform and how it applies to ARO-MAPT and some of our initial preclinical results with the platform as well as with ARO-MAPT and then he'll move on to the interim clinical results from the Phase I/II study. And then Chris will come back and talk about some key takeaways and then we'll have time for a handful of questions from the panel after that.

So before we start, I just want to introduce Dr. Boxer. He's a Professor of Neurology at UCSF. He's the Endowed Professor in Memory and Aging. And importantly, he runs their clinical trials research unit for both Alzheimer's as well as frontotemporal dementia, which is one of those primary tauopathies that we'll talk about. We're very fortunate to have him today. And please, by all means, ask any questions you want because he knows all the answers. So thank you, Dr. Boxer for joining us.

Now I'll turn the call over to Chris.

Thanks, Vince. Back in 2009, we decided to focus Arrowhead on RNAi. The field was in its infancy, but we believed that if we could develop the base technology and overcome delivery challenges, RNAi could be a truly revolutionary modality. We also believe that part of its power was in its potential breadth. So we sought to bring it to wherever disease is.

As such, our early focus was to create a set of platforms capable of safely and efficiently bringing RNAi to different organ systems and cell types. Today is not the culmination of this drive, we are always building -- always expanding, but it is a significant milestone, an important day. Next slide. Today, we present Arrowhead's first clinical proof of concept for ARO-MAPT and importantly, our expanded TRiM platform for CNS delivery. There are several important points going into this early data release.

First, the TRiM holy grail is overused, but I do believe that delivery in oligonucleotides via subcutaneous administration to the brain is a therapeutic holy grail. Second, broad distribution within the brain is critical for treating many indications in animal studies across rodent and nonhuman primate species suggest that our TRiM platform is capable of this. Third, good durable knockdown, a good durable and deep knockdown of at least 50% to 60% was our goal and the ability to detect this via the cerebrospinal fluid would be helpful. All of these were borne out in animal studies.

Fourth, we think the combination of employing RNAi in the brain with simple subcutaneous administration, potentially at home, that provide deep knockdown across brain regions, lasting several months between injections likely opens the possibility of treating many conditions from neurodegenerative to psychiatric to obesity. This feels like the company's worth set of potential value unto itself.

Next slide. Today's data have near-term importance beyond ARO-MAPT. As shown here, we currently have one wholly-owned and one partnered candidate in the clinic using the TRiM CNS platform, and we expect to add another partnered candidate in the clinic in 2027. In addition, we plan to introduce at least 3 new wholly-owned CNS candidates to the clinic over the next 12 months alone.

I expect CNS candidates to be an increasingly important part of our pipeline in the near to midterm. But let's also be clear, today is about ARO-MAPT and the important data we have generated thus far. We will show deep and durable knockdown in the CSF, and this is only after loading doses. We may see another step down in both knockdown and durability in the multiple dose cohorts as those data become available.

Given our animal data, we have a high degree of confidence that knockdown is occurring consistently across brain regions. As you will hear, there are substantial evidence that tau reduction may be important for treating Alzheimer's disease, and we think it is clearly important in primary tauopathies. Next slide. Dr. Boxer?

Good morning, everyone. Happy to present to you today and tell you a bit about the role of tau in Alzheimer's disease and other tauopathies. So the objectives are to review the current treatment landscape in Alzheimer's disease, understand the implications of recent therapeutic advances in amyloid and tau therapies, evaluate the rationale for tau-targeting therapies. I want to frame some of the key consideration for the next-generation therapies and talk about tau reduction for the treatment of primary tauopathies, which seems like a very exciting possibility.

Some people may be familiar with the history of research in Alzheimer's disease and other neurodegenerative diseases of aging. But in general, in the diseases that we call tauopathies, when we look at someone's brain after they passed away and we look at it at autopsy and the same for protein like tau, you can see that, for instance, in Alzheimer's disease, the -- both the amount and the anatomical location of this insoluble protein, this brown -- dark brown stuff that you see, is strongly correlated with the severity of symptoms and the types of symptoms that the patient experienced during life.

This is true not just for Alzheimer's disease. And again, in the upper left-hand corner, these are the famous Braak stages of Alzheimer's disease that we use neuropathologically to stage Alzheimer's disease, but they're also recapitulated now with tau sensitive PET ligands, but it's also true in other tauopathies that we call primary tauopathies like progressive supranuclear palsy Richardson syndrome on the bottom left. And on the right, chronic traumatic encephalopathy, the disease that many football players and others who have had repetitive brain injuries get.

And so it stands to reason that if the amount and the anatomical location of this insoluble tau is strongly correlated with the symptoms during life then one treatment approach might be to try and either reduce this tau in the brain or prevent its buildup in the first place.

So what is tau? Tau was initially thought just to be a protein that binds to structures within neurons called microtubules and it is. That is an important role for tau, but over the past decade or 2, we've learned that tau plays many important roles in neurons in the brain. It is in the nucleus and combined to nucleic acid like DNA and RNA. It seems to also play a role in energy metabolism in neurons in the structures called the mitochondria. And tau is also found in the synapse, these structures that allow one neuron to communicate with another. And it seems to play a role in the synaptic transmission or the communication that's mediated by neurotransmitter release from one cell or one neuron to another.

As I mentioned, the most common tauopathy and the tauopathy that many of us are familiar with is Alzheimer's disease, but we consider that to be a secondary tauopathy. And that is because, although tau may be present in many people's brains due to normal aging, prior to the buildup of amyloid, we think that it's beta amyloid or the plaques that are present in many people's brains that really drives the overproduction and spread of tau throughout the brain. In primary tauopathies, like progressive supranuclear palsy, corticobasal degeneration Pick's disease and individuals with tau mutations, we think it's the tau itself that's really doing all the damage on its own. And we don't know as far as what's maybe promoting its spread throughout the brain.

There's also quite a bit of evidence from genetic studies like Genome-Wide Association Studies that even though we often don't find insoluble tau at autopsy in the brains of patients with other diseases like Parkinson's disease, multisystem atrophy or epilepsy that from genetics, we know that tau is also very strongly linked to the risk and sometimes the progression of these diseases. We think that in all of these diseases, a central pathogenic mechanism is the accumulation of this toxic misfolded form of tau and we call that toxic gain of function.

There's quite a bit of evidence that this toxic misfolded brown stuff that I showed you on the previous slide may be spreading from one cell to the other throughout the brain and this causes neuronal and glial dysfunction and eventually synaptic loss and degeneration. And as I'll mention in a moment, there are certain cells, including neurons, have evolved mechanisms to resist the spread and the build above this toxic gain of function, but we think, in disease, this overwhelms the compensatory mechanisms.

We think that also aging may be a part of this problem.

So in Alzheimer's disease, we have a big advantage in studying the progression of the disease. Many people may be familiar with these biomarker graphs, some people call them Jack curves. Up in the top right-hand corner, you see a picture or a schematic of the tau protein. We know that the tau protein is usually cleaved into two pieces, and the end terminal fragments are soluble and float around. And what you can see is that in most people who go on to get clinical Alzheimer's disease, there's evidence from these biomarkers that we can measure -- in living humans, we can measure soluble forms of beta amyloid or amyloid plaques using PET that the soluble form of tau builds up in parallel with the amyloid plaques, which are often present for decades in individual brains before they develop symptoms of Alzheimer's disease.

In Alzheimer's disease, we can also measure that insoluble tau that I showed you on the first slide using PET. And it's that second half on the right of the tau molecule that includes the microtubule binding region that seems to be accumulating. And you can see there's sort of a point of inflection that occurs right before the onset of symptoms in most people who get Alzheimer's disease. We call that the catastrophe of Alzheimer's disease. Actually, it's Reisa Sperling and Keith Johnson, who coined that turn. But the important point is that patients can have amyloid plaques in their brains for decades without any symptoms, but when that insoluble form of tau starts to accumulate and the catastrophe occurs, that's when people develop symptoms. And so the goal is to try and prevent the catastrophe or at least to reduce it or blunt it.

We know now that there are -- and we -- clinicians are very excited that there are 2 FDA-approved anti-amyloid drugs that are commonly used now in the United States to treat Alzheimer's disease. These are data from the Phase III trial of 1 of these drugs called donanemab. What you can see in the left most panel is that using a common global measure called the clinical dementia rating scale, some of boxes, that treatment with donanemab in people who are already symptomatic with Alzheimer's disease who have prodromal to mild disease, leads to a modest, but significant reduction in the rate of decline by about 35% to 40%. And in parallel, you can see that the number of amyloid plaques is really profoundly reduced by the drug.

So reducing amyloid is associated with this benefit in symptomatic Alzheimer's disease, but it's a relatively modest benefit, and it may not be enough. As I told you previously, there's been a long-standing hypothesis that it's really the tau that's the problem and that it's the amyloid that's driving the tau and the catastrophe.

And so what we think is going on with anti-amyloid drugs is that you see in that dark red curve is that we can dramatically reduce the amount of amyloid plaques in the brain with either donanemab or lecanemab. But when we start at least in patients who are very mildly symptomatic already, the catastrophe is already well underway in that dark blue line. And what we know from tau PET is this has very modest effects on blunting or reducing the catastrophe, and this leads to a modest effect on reduced cognitive decline.

We think that a drug that could really effectively blunt the catastrophe, maybe by targeting tau itself, would have a much larger effect. And that's the hypothesis and that we're hoping to learn more about in future trials of tau therapies.

Where did the idea of tau therapies come from? Well, people have been working on this for over 20 years. Some of the first experiments were done by Lennart Mucke and Erik Roberson at UCSF and the Gladstone Institute. And they showed that in Alzheimer's disease, transgenic mice who carry a human Alzheimer's precursor protein transgene, that about a 15% die after about 6 months, but reducing the endogenous amount of tau by genetically knocking out one of the mouse tau alleles makes these mice resistant to human amyloid toxicity, not only that but in a different line of mice reducing the tau even by just one allele or 50% makes them resistant to tonic-clonic seizures from a toxin called [indiscernible]. And so again, this supports the-- here the tau is important for maybe Alzheimer's disease, but also many other brain diseases. And so an effective tau drug might find a role in treating many neurological and neurodegenerative diseases.

So fast forward now over 2 decades, and we now know from Biogen's experience with [indiscernible]. These are data from the Phase I study. This is an intrathecally administered tau antisense oligonucleotide that in patients with mild to moderate symptomatic Alzheimer's disease, that reduction of tau by up to about 60% measured in the CSF using CSF phospho-related tau assay is safe and well tolerated.

And remarkably, in these Phase I results, we saw that for the first time, not only is it possible to stabilize the further accumulation or to maybe blunt that catastrophe as measured by tau PET in a small number of people who were followed for 2 years, but there appeared to be less of that red stuff in the lower right-hand panel, which is the insoluble tau. So not only can a genetically targeted tau therapy seem to reduce the further accumulation of tau, it seems partially reversible. And this was a really big deal for our field. Many people are really excited because up until this point, we thought that accumulation of tau was an irreversible process. Now we think that may not be true.

And so I think as many people know, there has been a larger Phase II trial of the same antisense oligonucleotide, diranersen. I'll show you the key results in just a moment, but the trial was overall negative, and we'll discuss why. But this drug is now -- has been announced to be moving to Phase III, underscoring the promise of this approach for treating Alzheimer's disease.

So I'd like to just take a step back now and remind you a bit about the genetics and the biology of tau, because it's really important that you understand this for understanding the different diseases that we might wish to treat with a genetically targeted tau drug. So this shows that tau as an alternatively spliced gene that gives rise to 6 protein isoforms in humans, and their name for the number of microtubule-binding domains, either 3 are 3 microtubule-binding repeat tau or 4 microtubule-binding repeat tau.

And in a normal adult brain or in someone with Alzheimer's disease, the ratio of these protein Alzheimer's -- protein isoforms excuse me, is equal, but in the primary tauopathies, we see in these sporadic diseases like corticobasal degeneration and PSP, there seems to be far too much for repeat tau and in a different tauopathy called Pick's disease, which causes frontotemporal dementia, there's too much to repeat tau. So it seems that having too much or an imbalance of isoforms may be toxic to neurons.

It turns out also that there are rare families around the world who have autosomal dominant mutations in the tau gene itself and these give rise to severe early onset forms of dementia or movement disorders. And remarkably, where that mutation is in the tau gene has a big effect on how the mutation exerts its effect biologically and also on the phenotype or the symptoms produced by that mutation. So for example, mutations in Intron 10 lead to too much production for repeat tau, and the individuals who have those mutations often develop clinical symptoms that look like CBD or PSP.

Conversely, when we do a Genome-Wide Association Study of the sporadic or the non-genetically determined diseases, CBD and PSP, we find the strongest genetic risk factor are single nucleotide polymorphisms or sequences in or around the tau gene itself with 1 particular sequence called H1c, probably increasing the amount of tau expression and greatly increasing risk for these diseases. And we now know that there are other genes that have been identified that may help to reduce the amount of tau expression or improve its clearance by the cells that are protective against these diseases.

So why am I mentioning this? Well, it's important as we think about the possible indications for tau-targeted drugs that in those who've studied the drug development in general, the odds of bringing a drug successfully to market is much higher if there's a strong genetic link between the target of the drug and the disease itself. And what I've mentioned is that in the -- with tau, there are very strong links to primary tauopathies, but less so for Alzheimer's disease.

And in fact, most of the mouse models that have been used to develop tau-targeting drugs are made with these mutations, P301L and P301S that cause human early onset, frontotemporal dementia. And so there -- we've already seen promising clinical data from diranersen in patients with Alzheimer's disease, but what I want to make the case for is that there may be even a stronger rationale from a genetic perspective to treat primary tauopathies with tau-targeting drugs.

So what's going on with Alzheimer's disease? If there's no genetic link, why do we think that we should be treating these patients? Well, with the tau therapy, well, you already saw their relationship temporarily at neuropathologically between tau in Alzheimer's disease.

And a recent study from Judith Steen at Boston Children's that we helped with showed that although genetically, there's not much of a link between tau and Alzheimer's disease, at autopsy, when you quantify the amount of insoluble tau in that rightmost column in the brain when someone passes away, there's about 50-fold higher levels of insoluble tau, that brown stuff I showed you in the dark in the first slide, than there is in the primary tauopathies or in control. So Alzheimer's disease is really a disease of tau, too much tau, but it may be building up for other reasons.

So what have we said? Well, we think that the central hypothesis of Alzheimer's disease is that tau is really leading to the clinical symptoms of disease. This is promoted by having amyloid plaques in the brain for decades. But there was a worry and before we talk about the Phase II results with diranersen that most of these hypotheses were based on observational or correlative data and maybe the tau that we measure in living humans or people who come to autopsy assisted marker of some other pathogenic process. So the alternative hypothesis is that tau increases with these diseases, but something else is really leading to the clinical symptoms. And that's why the Phase II diranersen trial was so important for the field.

Again, I told you that in PSP and primary tauopathies, we think that that's really tau was the only pathogenic protein that's present in most cases. And so we have much greater confidence based on that and the genetic link that it's the tau that's the real problem. And of course, in tau mutation carriers, we know 100% for certain that it's the tau that's causing the disease.

So again, many have seen these results. These are from the Biogen diranersen trial. And remarkably for the field, what was shown is that reducing tau by 60% roughly in the CSF in patients with mild, prodromal to mild Alzheimer's disease was also associated with a 42% slowing of cognitive decline at the optimal dose, which turned out to be the lowest and not the highest dose of drug. This is really remarkable because it helps to support this hypothesis that tau is a central pathogenic protein in Alzheimer's disease because all of these patients still had high levels of amyloid in their brain, but reducing tau was associated with the clinical benefit.

Unfortunately, this trial did not produce the results we had all hoped for, which was across the board benefits, and so there was less of an effect seen on activities of daily living or on global measures like the clinical dementia rating scale that I showed you in the slide with donanemab earlier.

And so the question is, why wasn't there a bigger clinical effect of reduction of tau? Why was it only 42%? And why was it only at the lowest dose? Well, one thing that was reported in these results at AAIC was that there were dose-related side effects, either confusion and falls, most commonly in the 1 week following injection. And maybe these mitigated some of the benefits of lowering tau in these patients. And you can see in the lower right-hand corner in the subset of people who received longitudinal tau path that in orange, this was the optimal dose, and this had the least amount of insoluble tau reduction, but there was insoluble tau reduction.

So one question that we're all struggling with in the field right now is, is there something -- was there something about diranersen, because it's an intrathecally administered ASO that is leading to the side effects that cause confusion and falls and maybe it's inflammation, maybe this was mitigating the benefit of reducing tau.

Alternatively, and we hope this is not the case, but we don't know for sure, maybe there was some on-target toxicity of tau reduction. And even though reducing tau in animals has been benign and genetic studies of humans suggests that loss of tau function is not associated with disease that may be what this study is telling us is that maybe there is a limit to what we can do. But I think we just can't resolve these based on these data.

Other possible reasons why more prominent clinical benefits were not observed in the study, well, maybe they started too late disease, maybe you have to start earlier in a catastrophe or maybe you need to remove both a beta, and I mentioned that the a beta was still present in these patients and tau and also maybe in the future other pathogenic proteins like alpha-synuclein, about 30% of these individuals are -- were also found to be alpha-synuclein positive. And in another study funded by the U.S. National Institutes of Health, we are doing a platform trial where we're combining amyloid and tau therapies. I'm not here to tell you about that, but combination therapy may be something that we will do in the future to really see the greatest benefits.

And of course, as I suggested to earlier, maybe primary tauopathies will respond better.

This is an important insight that we've had from new technology called cryo-electron microscopy. And really, it turns out that using this technology, we've been able to solve the 3-dimensional structure of the aggregates and the various primary and secondary tauopathies. What we've learned is that it's that the core structure which corresponds to the microtubule binding domain has a very regular, what we call amyloid structure in each of the tauopathies. And that in different tauopathies remarkably, the 3-dimensional structure of this core is different.

So maybe it's actually the core that's driving the disease or the actual structure of these aggregates. We don't know for sure, but what we do know is that there are other -- many other therapeutic approaches to tau, many of them are immunotherapies and the first 5 or so failed. And we think that the reason why they failed is because instead of targeting the tau core structure, they targeted the end terminal regions of tau, which I told you earlier, often cleaved off.

Some of the newer immunotherapies target this core structure and are beginning to produce more promising results. And so there may be other approaches to tau therapies particularly immunotherapies that target this toxic core structure that might also eventually find their way to the clinic.

One example or the first example that's been tested in a large Phase II is bepranemab. And in a post-hoc study in individuals who either had low tau at baseline or APOE4 noncarriers in the upper left-hand panel -- or excuse me, in the middle left-hand panel, you can see that this antibody that reduced extracellular tau by binding to the end terminal portion of the microtubule binding region, seem to attenuate tau PET uptake and also slow cognitive decline on the ADAS-cog.

And this, again, was -- these data were presented a few years ago, but this was very important for the field because it was the first experimental demonstration with an interventional study in living humans that neutralizing extracellular tau with a monoclonal antibody had a clinical benefit or potential clinical benefit. And this really supported the hypothesis that tau spreads from 1 cell to another through the extracellular space.

So these are, I think, promising developments for tau therapeutics.

What about primary tauopathies? Well, remarkably, we've been doing clinical trials in progressive supranuclear palsy for over 20 years. But for the first time, earlier this year, presented at AD/PD a trial with a different antisense oligonucleotide called NIO752, showed that in patients with PSP Richardson syndrome, reduction of tau in the CSF by about 25% to 30% was associated with the stabilization of neurodegeneration as measured by CSF neurofilament levels. Neurofilament is an axonal protein that's released when neurons degenerate. This was really remarkable because never before in a clinical trial in PSP had we've ever seen anything that seem to have an effect on neurodegeneration or disease modification. And so this drug is now in a Phase III study.

So to summarize, what I've told you is that hardening tau really reflects the close clinical pathological correlation between insoluble tau accumulation and many different neurodegenerative diseases of aging, not just Alzheimer's disease, reducing production and targeting all forms of tau, maybe a pragmatic solution, you've seen the challenges with immunotherapies. There are exciting results with both diranersen and NIO752 to other genetically targeted tau therapies, and we're eagerly awaiting the next round of results with these drugs. And there is a huge global unmet need for both Alzheimer's disease, but for primary tauopathies in particular, because these are severe diseases with no approved therapies that can help these patients.

We think or I think that there is a very strong rationale for testing tauopathies outside of Alzheimer's disease, and I told you that there are very strong genetic link suggesting maybe even these drugs might even potentially work better for primary tauopathies.

So with that, I'm going to end, and I'm sure there will be time for questions, and I'll turn this over to James. Thank you.

Thank you, Adam, for that great overview. So now we'll switch gears and talk about platform and the ARO-MAPT study. So for those of you who are new to the story, Arrowhead remains focused exclusively on developing siRNA therapeutics.

We leverage the TRiM platform, which is a set of rules and algorithms for sequence selection coupled with a library of linkers and targeting ligands to facilitate siRNA delivery into multiple cell types. Any given platform is modular, which allows for a degree of repeatability in GLP toxicology studies and drug manufacturing. Broadly, the TRiM discovery platform is designed to facilitate rapid progression from concept to clinic.

The CNS platform uses a TFR1 targeted fab covalently linked to the siRNA payload to facilitate subcutaneous administration and effective delivery of siRNA across the blood-brain barrier. This strategy has several advantages over the intrathecal route of administration, which will be described in the next few slides.

Here in monkey studies, we've confirmed the ability of the platform to silence MAPT expression by better than 75% across various brain regions with subcutaneous administration of development candidate, ARO-MAPT. This includes effective silencing in Alzheimer's disease relevant brain regions, including the hippocampus.

In a long-term multi-dose monkey study, we confirmed the ability to maintain MAPT silencing after repeated doses. These data support long duration of effect with up to 60% CSO tau knockdown up to 4 months after the last dose.

Importantly, the knockdown achieved with subcutaneous administration of siRNA delivered across the blood-brain barrier using the Arrowhead CNS platform is more consistent and more homogeneous as shown on the right, compared with intrathecal delivery of siRNA targeting MAPT as shown on the left.

This is important because better distribution avoids concentration of drug in the spinal cord as is common with IT delivery and facilitates potentially better gene target silencing in the most relevant brain regions.

Here again, we emphasize the more homogeneous drug concentrations achieved across various disease relevant brain regions with subcutaneous administration using the Arrowhead platform as shown in monkeys on the left. This is compared to the highly heterogeneous delivery seen with IT administration and IT-administered ASO in a clinical radiotracer study as shown on the right. Note the lack of signal in the brain in some participants in the panel on the right and the strong signals seen in the lumbar spinal cord.

So now that we've reviewed the platform, let's switch to the ARO-MAPT clinical study. ARO-MAPT SC-1001 is a dose-escalating study of ARO-MAPT in healthy volunteers and in patients with early Alzheimer's. The study is intended to understand safety, PK and pharmacodynamic response in healthy volunteers and in Alzheimer's patients using multiple escalating dose levels and various dose interval strategies.

The Alzheimer's patient cohorts will enroll individuals 50 to 80 years of age with early Alzheimer's based on CDR and MMSE score cutoffs as well as the presence of at least 1 biomarker consistent with Alzheimer's. Participants must not be on or have no plans to initiate Alzheimer's disease-modifying therapies, including anti-amyloid therapy for the duration of the study.

The study has or will have sites open in Canada, U.K., Australia and New Zealand, and the healthy volunteer enrollment is complete. We're currently focused on enrolling the Alzheimer's patient cohorts. Primary endpoint of the study is safety, but we have multiple pharmacodynamic endpoints built into both the healthy volunteer and the Alzheimer's disease patient components of the study, and we will be evaluating various cognitive rating scales in patients. However, today, we'll be focusing on the data that's available from the healthy volunteer single escalating dose cohorts.

Briefly, here, we show baseline characteristics, generally consistent with those of a typical healthy volunteer population. And here, we show CSF total tau reduction over time by dose group. After the initial loading dose, we're seeing mean CSF tau reductions of up to 73% and a maximum individual reduction of up to 85% with evidence of dose response and with no reductions in the placebo group.

On the next slide, we show individual CSF tau responses, indicating a generally consistent post-dose magnitude of tau reduction across individuals receiving ARO-MAPT compared with no response in placebo. Available safety data so far is supportive of continued dose administration and a progression to later-stage studies. ARO-MAPT has been well tolerated with no reported serious treatment-emergent AEs, no neurobehavioral AEs such as confusion, and no persistent anemia.

In terms of next steps, we plan to first finish dosing in the multiple ascending dose cohorts in healthy volunteers with a planned data update next year. We also plan to continue enrollment in the Alzheimer's patient cohorts also with a planned data update in 2027, and we have initiated discussions with regulators in anticipation of later-stage studies in MAPT variant frontotemporal dementia and progressive supranuclear palsy.

In conclusion, Arrowhead's subcutaneous CNS siRNA delivery platform has been well tolerated to date in healthy volunteers in Alzheimer's patients. Subcutaneous administration of ARO-MAPT in healthy volunteers has demonstrated deep dose-dependent and durable knockdown of CSF total tau with potential for more homogeneous brand distribution. These data represent initial clinical validation of ARO-MAPT and importantly, of the TRiM CNS platform, which is an important milestone for Arrowhead and also for our partners using this platform.

In addition to ARO-MAPT, Arrowhead has multiple wholly-owned CNS targeted preclinical development programs, including 2 planned for CTAs by end of 2026 or early 2027.

And I'll now hand the call back over to our President and CEO, Chris Anzalone. Chris?

Thanks, James. Next slide. We believe that what we have shown today represents scientific and potential therapeutic breakthroughs. And this is just the first step. It appears that we are able to deliver siRNA to the CNS across the blood-brain barrier in a well-tolerated manner.

Administration is by simple subcutaneous injection that could potentially be done at home as infrequently as quarterly. We see deep and durable knockdown that we expect is occurring across brain regions, including the deep brain. We could see even deeper and more durable knockdown after multiple doses. Our nonclinical work in the CNS and extensive clinical and nonclinical work in other cell types have suggested that once we validate our ability to deliver to a particular cell type, we can reliably reproduce that against other targets.

Simply put, it appears that cells don't care what siRNA sequence we use. So this early clinical proof of concept could have a wide-ranging predictive value across any number of disease treatments. With a minimally invasive platform that enables us to silence virtually any gene expression in the brain, including in both neurons and neuroglia, we should be able to address conditions from neurodegenerative to psychiatric to sleep disorders to migraines, to obesity and others.

It is difficult to overstate the flexibility and importance of this platform, we believe we are limited only by the number of targets we can identify. Let's also focus on the leap forward we see in the current candidate ARO-MAPT. The biology around primary tauopathies is fairly clear and ARO-MAPT could be a powerful therapy for many of these patients. The regulatory pathway could also be fairly straightforward and relatively short, so we hope to bring ARO-MAPT to these patients as quickly as possible.

More broadly, we hope to bring ARO-MAPT to the approximately 30 million to 40 million people worldwide suffering from Alzheimer's disease. Of course, this is a longer regulatory road and there is more biology to learn, but we look forward to our first data in patients with Alzheimer's next year.

Next slide. We now have clinical proof of concept for the TRiM platform's ability to deliver to 5 different organ systems. As I mentioned earlier in the presentation today, our model is to bring RNAi to wherever disease is and the current expansion into CNS substantially increases our reach. We continue to build the platform and expect to reach a new cell type every 18 to 24 months.

Next slide. In 2026 alone, Arrowhead has further solidified its position as the leading innovator in RNAi therapeutics. In less than a year, we believe we are the first to achieve clinical proof of concept of RNAi in the brain after subcutaneous administration, achieved clinical proof of concept of silencing 2 genes with a single molecule and achieve clinical proof of concept of RNAi targeted in adipocytes.

We tend to continue this pace in 2027 and beyond. With respect to follow-up on these achievements, we expect to present additional data in healthy volunteers in Alzheimer's patients with ARO-MAPT in 2027 and introduced at least 4 additional CNS candidates into the clinic by the end of 2027, to present additional clinical data with ARO-DIMER-PA in 2027 and introduce at least 1 new dimer to the clinic next year and to present additional clinical data for ARO-ALK7 by the end of 2026.

With that, I'd now like to open the call to your questions, and thank you for your attention today.

Thanks, everybody. Let me compile some questions. We have time for 3 or 4 separate questions. Okay. First question is from Madison El-Saadi at B. Riley. It looks like the first part of this will be for Dr. Boxer and then the second part, probably for James. First part is, could the planned FTD and PSP studies reach approval faster than Alzheimer's? And what would a design look like for those types of clinical studies. So we'll start there, and then I'll get the second part after.

That's a great question. I'm not a regulatory expert, but my understanding is that these are both rare diseases or they're considered orphan diseases with severe unmet need. There are no approved therapies. And so within the United States, at least, there are mechanisms, regulatory mechanisms to encourage the development. And I think there may also be some patent exclusivity benefits as well that may allow a more rapid development and certain additional considerations for approvals.

Also because these are rare disease populations, often it's not possible to do multiple different stages of development. Often, it's a Phase I and then a large Phase II/III. So we do think there are significant advantages. And then the third reason is that these diseases tend to have a much rapid -- much more rapid rate of progression, so you can do a faster, smaller, more efficient trial.

And just one last plug, which is the National Institutes of Health are also supporting a platform trial for progressive supranuclear palsy, which is up and enrolling now. And we hope that drugs like this could find their way into our platform trial.

Great. And then, James, what's the time line for additional regulatory interactions? And when would we assume that we'll start FTD and PSP studies?

Yes. So we're having those discussions now. I think over the next 1 to 2 quarters should have quite a bit of a meaningful back and forth on the regulatory front with an aim of finalizing a study design. I probably don't want to give guidance on timing to start those studies until we at least have the study design pinned down, but we'd be aiming to start something in '27.

Next question is from Jason Gerberry at Bank of America. And I would also think this is probably Dr. Boxer. Which downstream measures would you expect to change if MAPT silencing is disease modifying? For example, a tau PET neurofilament light, MRI measures, synaptic measures, neuro inflammation markers or another end point? And over what observation period could these changes reasonably become detectable? And I would split, split into Alzheimer's as well as primary tauopathies.

Okay. Well, there's a lot to discuss. We could spend a few more hours answering that question. But as I mentioned in Alzheimer's disease, we have the advantage that we can measure tau PET and soluble forms of tau pretty easily even in blood. And that would be the first thing that we'd look at. For -- and then again, they're well-established clinical and other biomarker endpoints in Alzheimer's disease.

For primary tauopathies, unfortunately, we don't have as good biomarkers of tau. We can measure for target engagement in CSF tau levels and p-tau levels. We don't yet have as good tau PET ligands. But as I already showed you, neurofilament light chain because these are more aggressive diseases, tends to be more elevated in primary tauopathies like PSP and tau mutation carriers, also MRI may be a good endpoint.

And increasingly now coming out of proteomic studies there is very clear evidence that there are other fluid biomarkers like biomarkers of synaptic connectivity, one is is called the synaptic protein ratio that may be particularly sensitive to these effects. We would hope -- again, these are, unfortunately, for the patients, more aggressive diseases. So for PSP, a typical study is 1 year, depending on when we would start, what stage of disease. A MAPT mutation carrier trial might be a little longer 18 months to 2 years.

Next question comes from Prakhar Agrawal at Cantor. What is the timing of Alzheimer's disease patient data? Actually, I'll head that off before James even gets to that. So in 2027 at some point, we have to see how those studies start enrolling. And then the next part of this question will probably be James and Dr. Boxer.

Based on the knockdown data that you're seeing in healthy volunteers, what level of knockdown would you expect in patients? And how are you thinking about the optimal dose here? It seems like an intermediate dose of 6.4 mg per kg and 12.8 mg per kg showed mostly comparable data.

Yes. I can start on that one. I agree. I mean I think that at least after that loading dose, day 1, 8, 15 or day 1, 15 that with those top few dose regimens, either 6.4 or the 12.8, they look very similar, right?

So we may be sort of hitting the top of the dose response curve. In that case, if they all look similar, we'd probably select the lower end of that dosing range if there's no benefit to going higher. That being said, we'll have to see how things evolve after we give the next dose, and we'll also have to see how things look in the patients.

I mean Dr. Boxer can comment on this, but the kinetics of tau might be different in Alzheimer's patients. And so we'll see how knockdown looks at the various dose levels and different dosing strategies in patients compared to what we saw in healthy volunteers. I just don't know yet.

Yes. I mean, I would agree with James that it's exciting to see these initial results, but there's still a lot more to learn. And as I said you earlier, the slide from the Judith Sheen that there's a huge amount of tau in Alzheimer's disease. We don't quite understand why there's so much of it, but the kinetics might be different. And so there's a lot more to understand, and we're excited to learn more from this compound.

Thank you. Next question is James Condulis at Stifel. One thing we've seen in the BIIB080 clinical data is that the tau PET benefit was lower than CSF tau. Do you think that's a function of its IT dosing and potentially reflective of insufficient knockdown in the brain? And in that context, can you talk about confidence that the CSF data is reflective of broad biodistribution throughout the brain?

I think it's a great question. I think it's important to consider the chemistry, and I know we're not all chemists here. But when you measure the CSF levels of tau, you're looking at that end-terminal portion of tau that's soluble, it's floating around in the liquid phase. And when we measure PET, we're looking at the insoluble aggregated clumps of protein. They're solid. And these 2 phases of tau, these 2 different forms of tau are in equilibrium.

And the important thing that we learned from diranersen in the Phase I is that we thought that there was a one directional arrow going from the soluble phase to the insoluble phase. Once there are these insoluble aggregates, they never could go away, but that turns out not to be true. But what does probably seem to be the case, and it's just common chemistry is that it's really easy for something to go from a soluble phase to the insoluble phase, but much slower in the opposite direction.

So to answer your question, the CSF biomarkers, I think, are much likely to be very much more responsive to the actual near-term pharmacodynamic effects of tau knockdown. And I do think that they accurately reflect the effects on tau protein. But there's going to be a very long lag in measuring with tau PET. Just due to the chemistry and due to the physical chemistry of trying to go from the solid phase back into the liquid phase.

Next question is from Mike Montani at B. Riley Securities. Second part of this question is, how does the subcu route change feasibility versus intrathecal in these various populations, both on the rare side and then the more come in Alzheimer's. And I would say that probably applies to both clinical trial recruitment as well as in clinical practice if these get approved.

Yes. I mean I think -- well, I'll answer first and then James, but I think it's super exciting. Many of us are less willing to get a lumbar puncture. It's not really a big deal, but it's still more invasive than a subcutaneous injection. And that is a barrier to enrollment in clinical trials and sometimes a barrier to even after a drug is approved to some on the brain to receive it. It can be more work for physicians to administer or for clinical staff administered intrathecal drug. And obviously, you can't do that in the convenience at your own home.

For the rare tauopathies and particularly when we talk about tau mutation carriers, this is extremely exciting because many of them are distributed in countries around the world where the health care system isn't as well developed as in the United States, and it may be really hard to get these therapies to people who really need them and administer them if it's by an intrathecal route, but one could really envision that a subcutaneously administered drug could really find its way around the world in a clinical trial and really, really offer great hope to these people if it works.

Yes, I'd echo that from just a clinical trial execution standpoint. I mean, we're still doing lumbar punctures to measure CSF -- various CSF biomarkers in the Phase I. Maybe in some of the Phase IIs, we'll do it, but we don't have to administer drug through that route. So I think that allows you to maybe reduce the number of lumbar punctures that are going to occur in clinical trials. Maybe by Phase III, you could totally eliminate them from clinical trials. And there's also probably just a different toxicity profile of administering drug directly into the intrathecal space compared to what you see with a subcu route.

I think we have time for just one last question. Since ARO-MAPT reduced both pathogenic and healthy isoforms of tau where tau also has physiologic function, can you frame how you're thinking about a therapeutic window for tau reduction? And I would maybe ask Dr. Boxer that first, and then James can chime in there. Is there a sweet spot there for reducing it enough, but not too much?

Yes. I think that's the key question for our field right now, honestly. Again, in animals, you can knock down tau to 0, and it seems to be pretty safe and well tolerated. If you look at large human genetic studies, looking for tau-associated genetic comp [indiscernible] tau that's associated with human disease is gain a function.

So there's too much tau misfolding, never loss of function. So there's never been a case that we know of tau loss of function associated with disease. But the diranersen results are producing questions. There's just a lot more that we need to understand and we need to probably look at these different drugs and different doses and different populations before we can answer this question.

Yes, I'd agree. I mean I think what we have right now are safety data with relatively short-term tau knockdown in healthy volunteers. So if you maintain that knock -- we haven't seen any associated safety issues with that knockdown, but again, it hasn't been over years and years.

So at least short term, it seems relatively safe, but we need to get -- to select the right dose level and the right level of tau reduction. I think it's going to depend a lot more on what we see in these patient cohorts in terms of changes in the other biomarkers, things like NFL, things like PET in Alzheimer's patients, but also in the primary tauopathy patients.

And actually, we have 1 more question. We have about a minute left. So a quick 1 for Dr. Boxer. This is from Eric Joseph at Citi, and he wants to know, what you would view as a clinically meaningful slowing of dementia progression in 80 patients over 1 to 2 years?

I would say, similar to what's already been seen with the anti-amyloid drugs. I think that -- I think it's clinically meaningful for our patients who are being treated already. So if we see something comparable with tau drugs, I think that's really encouraging. Again, as I -- the future may be combination therapy. And when we combine anti-amyloid and anti-tau, there's a potential for a synergistic effect. So I think the future is really exciting for our patients and for all of us who are getting older.

Thank you. Thank you, Dr. Boxer and James and Chris as well, and thanks, everybody, for joining us today.

Thanks, everyone.

Okay. Perfect. Hello, everyone. Good morning, and welcome back to H.C. Wainwright's 20th Annual Global Investment Conference. I'm Patrick Trucchio, senior health care analyst at H.C. Wainwright. It's my pleasure to welcome our next speakers, CEO, Chris Anzalone; and CMO and Head of R&D, James Hamilton at Arrowhead Pharmaceuticals.

Arrowhead is a commercial stage pharmaceutical company developing RNA interference or RNAi therapeutics with broad pipeline across cardiometabolic indications and CNS. Arrowhead REDEMPLO, plozasiran, was approved by the U.S. FDA in 2025 as an adjunct to diet to treat triglycerides in adults with familial chylomicronemia syndrome or FCS. At the end of August, Arrowhead presented the full 12-month results of the pivotal Phase III SHASTA-3 and SHASTA-4 trials in severe hypertriglyceridemia, or sHTG, in a hotline late-breaking science session at the European Society of Cardiology Congress and plan to file a supplemental NDA by year-end in sHTG using a priority review voucher. So it's a huge year for Arrowhead. Pleasure to have you with us.

Just first, it's been a transformational last few months, FCS launch, 2 positive pivotal trials, priority review voucher. For those who are new to the Arrowhead story, can you give us an overview of the RNAi platform, why subcutaneous RNAi to the liver became such a robust franchise?

Sure. First, thanks very much for having us. It's a pleasure to be here. So we have been banging our head against the RNAi wall now for over 15 years. And as you point out, the first tissue that we could address is liver hepatocytes. But we decided early on that in order to extract proper value from this technology and to treat as many patients as we could, we need to get outside the liver. And so as early as 2010 or so, we started working on technologies to get us outside the liver.

And where we are now is we've got a broad platform that enables us to get into 7 different cell types, 5 of which are represented in clinical candidates right now. We've said publicly that we think we can get into a new cell type every 18 to 24 months, and we believe we'll continue to do that. So while the first leg of our journey was within the liver. It was certainly not the last. And I think we'll talk about CNS today as well as probably some other cell types.

And so our goal all along was to build a very broad-based company, which is a new thing. It's a different thing for a small biotech company to do. We were not focused on 1 or 2 areas. We're focused on a large number of them. And things were hard for quite some time. But it feels like over the last 18 or so months, we have finally broken out. We've become a commercial company. And we now have something like 21 or 22 individual drug candidates in clinical studies.

So REDEMPLO is launched in FCS. Maybe before we get into more specifics on that program, maybe you can just talk about the launch. How is it going? Where has payer policy landed? How are things proceeding?

Sure. So first, just to be clear, so plozasiran, REDEMPLO is an APOC3 inhibitor, and it was developed to lower -- to silence APOC3 and therefore, lower triglycerides. We view this as a 2-step drug, if you will, from a commercial standpoint. Step one is to be approved in a narrow indication, FCS, familial chylomicronemia syndrome. It's an ultra-orphan indication.

However, there are a class of patients that we have discovered that we call clinical or clinically defined FCS that make this a bit of a larger population. We've been focusing a lot on that population. Our goal then was to expand the label and treat severe hypertriglyceridemia, and that's about a 3.5 million person market in the United States. So we launched an FCS a bit ago, and the launch has been good. It's taken us a bit of time, a couple of quarters to get contracting worked out with payers. We're there now. We're able to serve both, as I mentioned, genetic FCS as well as clinical FCS. There could be as many as 15,000 or 20,000 or so clinical FCS patients.

And so we have also been ramping up our sales force. As we -- when we first launched, it was a very narrow sales force, about 20 or so sales reps. But as we were into the market, we realized that there really were more of these clinical FCS patients than we had first anticipated. And so we've begun to ramp this. We ramped pretty aggressively over the summertime. We will have another phase of growth in January, February time frame, and that will enable us to prepare ourselves for sHTG launch sometime in the second quarter, we believe, of 2027.

So you recently presented full SHASTA-3 and SHASTA-4 12-month data set at ESC. Can you summarize this data set and why it's meaningful?

Sure, James?

Sure. I can take that one. The top line data for SHASTA-3 and 4, first and foremost, we were achieving about 80% reduction from baseline in triglycerides. And this was all in a severe hypertriglyceridemic population. So triglycerides greater than 500 at baseline. That reduction in triglycerides translated into a statistically significant improvement in the rates of acute pancreatitis, which is the major problem those patients have. There's maybe some other issues around cardiovascular disease, but the life-threatening pancreatitis that can be recurrent in that population. So the key clinical event that's driven by triglycerides.

So the reduction in triglycerides correlated with a reduction in acute pancreatitis. Depending on the population, the risk reduction was 78% to greater than 80%. And all of this was matched with really a pretty clean safety profile. We didn't see any evidence of thrombocytopenia or hypersensitivity reactions. Our liver safety profile was really pretty quiet. The transaminase elevations in the active arms look similar to those in the placebo arms. And then something that we've been asked about quite a bit over the last year or so was liver fat or hepatic steatosis.

And we measured liver fat with MRI in the study and saw no clinically meaningful or statistically significant increase in liver fat versus placebo. So all around, we were really pleased with the data on both the efficacy, the pharmacodynamic side and the safety side.

Severe hypertriglyceridemia is a far broader population than FCS. Can you talk about the data that you've generated so far and how we should think about the meaningfulness of pancreatitis risk reduction, triglyceride reduction and how this sort of translates across these different patient populations?

Sure, James?

Yes. In the sHTG population. I mean, again, I think that the -- it's a spectrum, right? sHTG -- FCS is the worst form of sHTG, and there's some overlap in these clinical FCS patients with just sHTG patients. Of course, the rates of pancreatitis increase as the triglyceride rates or levels get higher. So we view those patients with triglycerides above 880 and a history of pancreatitis as for the highest risk population.

And in fact, in that subset in the SHASTA-3 and SHASTA-4 pool data, the risk reduction was 100%. There were no events on active in that population. So that's probably the population that is most amenable, at least earliest to treatment, where the most medical need is. That being said, we also saw events in patients with triglycerides just greater than 500, but with a history of pancreatitis. So there's also need kind of further down the chain of triglyceride levels, if you will?

Yes. Look, the value proposition here is clear. The biology is clear. We know that as triglyceride levels increase, the risk of pancreatitis increase. And we know that there is a sharp increase in that risk once people's triglycerides get it above 500 milligrams per deciliter and then it becomes very steep above 880 milligrams per deciliter. So -- and we have a drug that lowers triglycerides substantially. It's a clean drug. It's dosed once a quarter subcu at home. So the value proposition is clear.

Even so, this is an education play. This has been an untreated market forever because there's never been a good way to substantially lower triglycerides. And so while we see a huge opportunity here in a number of patients that need to be treated, it is also our job to help payers and providers and patients understand the need to lower triglycerides. And so this is not going to be one of those out of the gate gangbusters launch, we don't think. It's going to be a little bit of a slow burn for the first couple of years. But we think our numbers suggest that we think this is a $3 billion to $4 billion per year drug in the United States alone at -- for us at peak.

So you acquired the priority review voucher for plozasiran sNDA. Where does the pre-sNDA meeting stand? And what does the voucher do to timing?

Sure. So the voucher will shave 4 months off time. That's important for us. Importantly, we are not the first ones into this market. We have a competitor. We think we have a demonstrably better drug, but they're ahead of us. And so every month that we can shave off is important to not only shifting our curve, but also potentially changing the shape of that curve.

We are a bit flat-footed because they have a several month lead on us, and we just wanted to narrow that. So that was important. It was worth the money to buy the voucher. I'm sorry, what was the other part of the question?

Just what does it do to the timing and where does the sNDA stand?

Sure. And so we are -- I say we, I'm not doing anything. James and his team is furiously writing the sNDA, and we anticipate to submit that by the end of the year.

Great. Great. And maybe you can talk about the differentiation compared to ASO. Is it in the efficacy? Is it in the safety and tolerability profile? Is it less frequent dosing? Is it -- where is the differentiation? And how do you expect that to play out over time? Is this slow burn sort of launch progresses?

It's all of those things. At any -- look, ASOs can do some things that siRNA cannot do. ASOs can be involved in exon skipping because they enter the nucleus. That's great. ASOs can be untargeted and get into various cell types. And so there are many cell types that we cannot yet get into. And so there is clearly a value for ASOs. But when you can do either, it has been shown repeatedly now that siRNA that is engineered correctly leads to better durability, leads to a deeper knockdown and leads to a safer drug. And that's the case, I think, with our competitor here.

Ionis has a drug that works. Their Phase III data were compelling. But we just think that we have an edge here. We are a demonstrably safer drug, as James mentioned, we don't have any issues with transaminasemia. We don't have any issues with liver fat, no hypersensitivity, no thrombocytopenia. We are a simpler drug. It's a simple quarterly subcu injection rather than monthly. We don't require liver monitoring and titration up to a higher dose. Everyone gets the same dose level.

And we're stronger. We continue to show deeper reductions in triglycerides. So this just feels to us like a better platform. Having said that, as I mentioned, this is an education market. And so having 2 of us promoting drugs that work is a better thing for patients overall and for this market overall.

So just regarding MUIR-3, is the plan still to leverage that data alongside SHASTA-3 and 4 in the filing? And if so, where does MUIR-3 stand? When does this read out? What do you need to show there? And maybe you could just provide some background on MUIR-3?

Sure. Yes. So that MUIR-3 is complete. The database is locked, and that's part of our filing that will be submitted to FDA. That study was entirely based on a need to have a safety database of at least 1,500 patients on drug for a year, and the FDA allowed us to enroll since it's easier to enroll just HTG patients. They allowed us to enroll MUIR-3 with the HTG population, about 1,000 or so patients enrolled in that study. And then the other components, of course, are the SHASTA-3 and SHASTA-4 studies that those 3 make up the bulk of this sNDA.

Great. I just want to shift over to familial hypercholesterolemia. So YOSEMITE program, complete enrollment. I think data is expected around the middle of next year. So what are your expectations around this data? And should we expect that zodasiran is the next launch possibly as early as 2028?

Yes. So that study is fully enrolled. It's kind of on autopilot now, and I think the timing that you mentioned is correct in terms of when we'd see data. This is -- it's an interesting circumstance because we have a company that was partially funded and owned by Arrowhead Visirna that is a Chinese company that has the Chinese rights to zodasiran.

And they recently at ESC presented their Phase III data that showed 44% greater than 40% reduction in LDL cholesterol in an HoFH population. That's about what we showed in our Phase II also. So those are 2 pretty consistent data points. I don't think it's a stretch to say that we'd land somewhere in that range in our Phase III study, but we'll have to see down the road.

And that's a straightforward launch for us. I do believe that's our next launch after sHTG. And the sales force we're building for plozasiran REDEMPLO is focused on endocrinologists, cardiologists, lipidologists. And so this is an easy lift for zodasiran. We'll just add this to the bag. We're already calling on these physicians. So for us, this feels like found value, and it does feel like this could be a helpful drug for HoFH patients.

Have you framed the possible size of this drug over time?

We haven't really talked about that. It is an ultra-orphan. It is a small indication. Regeneron is treating them right now with an antibody. And our goal here was to have similar effects with a more patient-friendly dosing schedule, and I think we can hit that.

Can you give us an update on your obesity program? And just more broadly, how you're seeing obesity? And where does Arrowhead? Where do you fit in this very large market?

Sure. We're dipping our toe in the obesity market. There are some very interesting targets, and so it makes sense for us to see what we see there. The first 2 are INHBE and ALK7. Those are both part of the same Activin E pathway. INHBE is made in liver. ALK7 is a receptor in adipose. And we have -- we released some data early this year. We'll release more data towards the end of this year. James, do you want to talk about some of that?

Right. The update end of this year will primarily be focused on ALK7. We'll have some new INHBE data as well, and we'll give some details on the INHBE Phase II NASH study that we're getting up and running right now. We're in the process of getting some regulatory feedback on the study design. So that should be finalized study design-wise in time for the end of the year data update.

For ALK7, I think we'll have, of course, data on weight loss in some of the different subpopulations that we looked at. Particularly interesting to us is this diabetes type 2 diabetic subpopulation that they tend to lose less weight on GLPs. So it might be a unique area of need. In addition to the weight loss data, we'll have data on changes in body composition, visceral fat, total fat, lean mass based on MRI and then, of course, safety data.

And we'll have our third obesity candidate that we'll file a CTA on by the end of this year.

Got it. And would you -- with this next data set with the obesity programs, would you be moving them forward to a larger Phase II trials? Would you announce which indications, which trials? And are these programs that you think you would move forward on your own? Or would you look to partner?

So we are not actively shopping these right now. We are open to partnering if it makes sense, but it's not -- that's -- it's not required at this point.

And would the data -- the next data sets would that enable you to move to larger Phase II trials?

Yes. Yes, that will dictate whether or not we move on to a larger Phase II studies, yes.

And then ARO-DIMER read out just this week. We had the first-in-human data. Can you provide an overview of this program and the data that's been shown?

Yes. So ARO-DIMER, this is the first, at least as far as we know, clinical data using a dimer technology, so 2 linked siRNAs as a single molecule. And in this case, the 2 linked siRNAs, one of the siRNAs targets PCSK9, the other targets APOC3. So the intent here is to hit nearly all of the atherogenic lipoproteins. I guess we missed Lp(a) but we're hitting all the remnant cholesterol and the LDL cholesterol metabolic pathways.

And the data that we described yesterday, this was from the single escalating dose cohorts and there are 5 cohorts. We just reported top line data, and we'll share the details at a medical conference. But we were seeing really great reductions in APOC3 greater than 80%, better than 70% reductions in PCSK9, and that translated into I think, 54% reduction in LDL cholesterol, better than 70% reduction in triglycerides, around 60% reduction in non-HDL cholesterol and about 50% reduction in ApoB. And it's really that last value, the ApoB value that I think is the most telling because that represents all of the atherogenic lipoproteins, right?

If you can lower ApoB, you're not only lowering LDL cholesterol, but also lowering things like remnant cholesterol, VLDL. And I think that the single-dose data, those were largely consistent with what -- or better than what inclisiran has reported out and some of the other PCSK9s have reported out. So we felt pretty good about those data.

And we think there's a breakthrough for 2 reasons. One, on the platform side, it's a proof of -- clinical proof of concept that we can deliver 2 linked siRNAs to knock down 2 genes at once. First time anyone has shown that, that's important, and we'll take that to a number of indications going forward.

Second, it's a breakthrough because it is now the first complete "way to treat mixed hyperlipidemia patients." These are patients with elevated triglycerides and elevated LDL. There's not a good way to address both these issues right now, and we think we have it. So this is a very exciting potential drug.

Is the next step, would you move into sort of a larger Phase II? Or would you go directly into a CVOT? What's the future for the program?

It probably -- we need to finish this study first and get data after the second dose. The doses are spread out in the multi-dose part of the dose escalation on day 1 and 85. So it takes a while to get post second dose data. But once we see that, the plan would be to select a few doses, 2 or 3 dose levels to take into more of a Phase IIb study.

So probably 3 doses quarterly follow patients out, mixed hyperlipidemia patients out for a year, understand what dose -- narrow down the dose you really want to take into Phase III and then probably do a biomarker-driven Phase III, maybe a CVOT in parallel. But our goal would be to get approval based on LDL reduction as a primary in an LDL-driven Phase III.

Right. That makes sense. And then maybe just on the CNS pipeline, ARO-MAPT and maybe just any other assets in that platform that you highlight?

Yes. So I'll start with ARO-MAPT. That, of course, is our subcutaneously administered siRNA intended to silence the MAPT gene, which is the gene that expresses tau. Of course, tau is one of the key drivers in Alzheimer's disease, but also several other primary tauopathies. We use a unique delivery system. It's the siRNA is linked to a Fab fragment that targets the transferrin receptor.

And so that's how we get the siRNA across the blood-brain barrier into the neurons, the glial cells, the CNS relevant cell types. And we presented some monkey data about a year ago that showed with that -- with ARO-MAPT, with the actual drug, we were getting about 60% CSF tau knockdown. And the data that we'll be presenting within the next month will be the healthy volunteer data with the same drug with ARO-MAPT and we'll be focused primarily on safety, but also CSF total tau knockdown. There's not a whole lot else we can measure in the healthy volunteers. We are enrolling Alzheimer's patients in that study. That enrollment is ongoing. We won't have those data until next year sometime.

This current -- near-term data release will be focused on healthy volunteers. And then some of the other programs, mostly partnered programs. We have partnered programs with Sarepta that use this delivery technology. Their Huntington's program uses this and then their ataxin-1 and ataxin-3 program. And then we have an alpha-synuclein program partnered with Novartis using the same technology.

We have a robust development program underneath that. So we expect to have several additional wholly owned CNS targets in the clinic over the next 18 months or so.

Just regarding tau as a target, there's several other programs, BIIB080 among others that are in the clinic and have read out. What have been the read-throughs from these programs? And do we have an idea of what level of tau knockdown you need to see to have confidence to move this program forward?

Yes. I think the BIIB080 program, I mean, look, I thought those data were generally supportive the Phase II data. I know there was some questions around their inverse or lack of dose response. But at the end of the day, they showed reductions in CSF tau that corresponded to an improvement in tau PET, and that corresponded to improvements in multiple different clinical rating scales. So all in all, we thought those were positive and supportive of the tau hypothesis.

Now those were with an ASO, an intrathecally administered ASO. We're of the belief that not only that route of administration, but the ASO may lead to some safety issues, which could have muddied the water on the cognitive rating scale efficacy side of things. In terms of what we're looking for, we feel like we at least need to achieve knockdown on par with what BIIB080 achieved, so 50% to 60%. It's unclear if that's sort of the sweet spot or more knockdown, you'd see more improvements.

One thing to consider additionally is if you administer the drug with an intrathecal route, the distribution is really heterogeneous, right? You get a lot of drug in the cord, some in the cortex, sort of very little in the deep brain regions. If you come from the blood side, right, with a subcutaneous injection, and we've shown this in monkeys, you get much smoother biodistribution of knockdown and of drug concentration. So where we might get the same or similar levels of knockdown in total tau CSF, the source of knockdown might be really different between an IT administered ASO and a subcu administered siRNA.

Right. That's really interesting. Maybe just as a final question. What do you think investors are missing about the story about the pipeline, about the stage of the company at this point?

It's funny. The reward for becoming commercial is that people only focus on the drug that's commercial. We have a massive pipeline...

All right. Hello, everyone, and thanks for joining us at the Morgan Stanley Global Healthcare Conference. I'm Mike Ulz, one of the biotech analysts here. And it's my pleasure to introduce the team from Arrowhead Pharmaceuticals. To my immediate left is Chris Anzalone, CEO; and to his left is James Hamilton, CMO.

And just a reminder, the format for today is a fireside chat. But before we get into the Q&A, I just need to read a quick disclosure. For important disclosures, please see the Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. And if you have any questions, please reach out to your Morgan Stanley sales representative.

So with that, Chris and James, thanks so much for sharing your time with us today, and I thought we could start with ARO-DIMER-PA just following some of the updates you provided this morning. So maybe walk us through some of that early data and what it means.

Sure. Thanks again for having us here. It's really a pleasure to join you today. Okay. So the ARO-DIMER-PA, I think, was a breakthrough for us and I think for the field for a couple of reasons. One, broadly, this is the first time anybody has shown knockdown of 2 genes with a single molecule using RNAi. And I think that, that is an extraordinarily powerful approach that could be used across indications. And so I think that's important as a proof of concept that we can do this. We have several additional dimers that we are developing as we speak, and you'll probably see those enter the clinic -- or some of them enter the clinic next year in 2027.

Now more specifically, we're excited about the candidate because it could be a "complete way to treat mixed hyperlipidemia patients." These are about 20 million people in the United States who have elevated LDL and elevated triglycerides. And these folks can be treated today with PCSK9 inhibitors to lower the LDL portion, but there's nothing to completely treat them. And so our goal here was to be in the ballpark, was to enable -- was to lead to a reduction in LDL that is somewhere similar to current PCSK9 inhibitors. And then on top of that, lower triglycerides as well that is somewhere similar to what we're doing in plozasiran as a pancreatitis drug.

And I think we hit those in spades. We are seeing at least as good LDL reduction in this population as folks have seen with PCSK9s writ large, and we are seeing similar TG reductions that we saw with plozasiran. And so we go forward with something that we think is really compelling.

And James, do you want to talk a bit more about the granular data?

Sure. Yes. I think one of the things to emphasize in the data we released this morning was the ApoB reduction, fairly large ApoB reduction of about 50%. That is a little bit better than what some of the PCSK9 inhibitors have shown in a similar mixed hyperlipidemia population. And that's likely attributed to what we showed was the PCSK9 effect, but the additional effect of APOC3 knockdown on ApoB. So I think this is evidence that you're hitting all of those atherogenic lipoproteins from 2 different pathways, the PCSK9 pathway and the APOC3 pathway. And then, of course, these -- the data today were just single-dose data. The study is fully enrolled, so we should have multi-dose data at a medical conference down the road.

Yes.

I was going to say -- and of course, you never know how good a drug is until later in development, of course. But what we have here, I think, is a really unique situation that at this very early stage and early in a Phase I study, it appears that we have a drug. We know how our drugs interact with people from a safety standpoint. We've been in thousands and thousands of patients with our GalNAc constructs. And so we feel pretty good about where the safety should go. We know how APOC3 inhibition affects people with plozasiran now in many, many patients.

The keys here are PCSK9 reduction and LDL reduction on the one side and APOC3 reduction and triglyceride reduction on the other side. And we're seeing just blanket consistent good results there. So it certainly feels like we have something that could be extraordinarily powerful for this population. Now we just need time. Our hope here is that we can have this dual regulatory pathway where we can run 2 pivotal programs. One is based solely on LDL reduction as a primary endpoint.

All the PCSK9s were first approved based solely on LDL reductions. That is a year-long study. And by doing that, we think we can get to market fairly quickly and start to penetrate this market while we're doing a cardiovascular outcomes trial. And if you look at inclisiran, that has a run rate of around $2 billion right now, and they haven't had outcomes data readout yet. So I think that you can address a sizable part of this market fairly quickly based solely on the biomarkers.

Yes. Can you just talk a little bit about some of the dosing intervals you're exploring or what that might look like and when we might see that data?

Sure. Yes. So the single-dose cohorts enrolled sequentially. And what that means is that we have different lengths of follow-up right now at each dose level. Based on the duration we've seen for the majority of the dose levels, we just don't have duration for the top dose level yet. But I think we're looking at quarterly at the most frequent. We'll see if we can push that to every 6 months as the data come in, but I feel confident around quarterly dosing. And we'll talk more about that when we present the data at a medical conference down the road, maybe Q4.

Yes. And in terms of the path forward, Chris, you mentioned there's maybe a quicker path with LDL reduction. Would that be sort of the next step after this study, you go right into a pivotal? Or is there more work that needs to be done prior to that?

There's a baby step before the pivotal.

Yes. I think our plan would be to amend the current study to add a Part III, right? Part I was single dose. Part II was the 2 dose. And then Part III would be a study that probably looks something like our SHASTA-2 study, different patient population, though. We're enrolling mixed hyperlipidemia population into Part III of this study. Maybe you look at 2 or 3 different dose levels, treat them quarterly for a year and just build that safety database and really understand depth and duration with multiple doses, safety with multiple doses before you then go into a pivotal Phase III with LDL as a primary.

Yes. Makes sense. And Chris, you talked about other potential dimers you may consider. I guess, I don't know if you can give us a flavor for what those might look like and kind of what's the trigger to start advancing these other programs? Is there some more data you want to see with DIMER-PA before you have the confidence to then move into others? Or maybe your thoughts there.

Yes. So you may have heard us talk about this in the past. We're an AND company. We're not an OR company. And so we were doing a lot of that development at risk. Now it is -- it makes us feel good that those data look good. But we are planning on those data working out. And so we've spent a lot of time on developing a number of different dimers. For instance, we will have some in obesity and MASH. INHBE and ALK7 are interesting targets. INHBE looks like more for MASH. ALK7 could be more for obesity. And we are developing dimers on both those sides. There are also additional dimers that we're developing on the cardiovascular side. So you'll hear more about these in 2027. We have not talked about what the next ones are going to be, but you'll hear more in 2027.

Okay. Great. And maybe we can switch to just plozasiran. Obviously, a lot of interest there. Large market opportunity for you guys. You're currently launching in FCS. So maybe let's just start there and talk about some of the dynamics you're seeing, payer coverage, et cetera.

Yes. So the launch has been smooth. It's been about what we expected, maybe a little bit faster than we expected. I think that we are learning that there are more clinical FCS patients out there than we first anticipated. That's a good thing. And so we have ramped up our sales force a bit more quickly than we had expected. That's also, frankly, a bit defensive as Ionis launches Tryngolza in SHTG. We didn't want to be out there -- we don't want to be outgunned, if you will. So that has gone well.

Payer interactions have been good, and we've got -- we have policies for most payers at this point in FCS. That's been good. We're now shifting our attention to SHTG. We've got good data that you'll probably want to talk about and James can fill you in on in SHASTA-3 and 4. So we are moving as quickly as we can to SHTG approval. In fact, we acquired a priority review voucher to speed that process up even more. We think that's important because we think we have something that is powerful here. We have a good value proposition. And the quicker we can get to those patients, the better they're waiting for good treatments and I think we've got one. We're really happy with the way this -- the profile looks right now after SHASTA-3 and 4. I'm happy to talk about that more after James goes through it.

Yes. So just a quick overview of the SHASTA-3 and 4 data. Triglyceride reductions, 80% from baseline, which we were really pleased with. And then that translated as we anticipated into a statistically significant reduction in the AP event rate. And then also a statistically significant reduction in the time to event or improvement in the time to event rather.

Additionally, we saw large improvements in the number of patients that were reaching goals, both less than 150 as well as less than 500. And then probably one of the most important aspects of the data, the pooled cohorts were the safety data that we didn't see any signs of hypersensitivity or any anaphylactoid reactions, no thrombocytopenia and really a pretty quiet liver safety profile. There was no statistically significant difference between active and placebo in terms of liver fat changes. And then the transaminase change was pretty placebo-like as well for the active group.

Yes.

And we think our value proposition here is -- it could not be clearer. We think there's about 3.5 million people with trigs above 500. We know that above 500, there is substantially increased risk of acute pancreatitis. We saw an improvement in pancreatitis risk in the study in the broad population as well as in the high-risk population. We are -- this drug appears to be safe, simple and strong. It is our safety profile, as James said, is sterling. We saw no hypersensitivity, no thrombocytopenia, no increases in liver fat, no real increases in transaminases.

It's a simple therapy. It's a once-a-quarter dosing, not once-a-month dosing. We don't require -- we don't expect to require any transaminase monitoring and changing of doses that's simple and it's strong. We just -- we see better trig reduction than anybody else in the field. And so we think that this is a profile that just fits really well with, frankly, the broad population, but at least early times in the high-risk population. These are people with triglycerides above 880 with or without pancreatitis as well as those above 500 with history of pancreatitis.

Yes. Can you talk a little bit more about the differentiation? You mentioned several of these points already, but just what do you think is the most important piece of the differentiation? And what are the other areas where you're different?

Again, we're an and company, we're not an OR company. I think all these together make it a differentiated product. But let me take a step back. So Ionis has a product that is good. This is a drug that works. And I think it's going to help a large swath of patients. And I think that it's a good thing that both of us are promoting these 2 good drugs because this is an education play. I think there's an awful lot of patients who need to have their triglycerides under control, and we need to help the world appreciate the importance of that.

Having said all that, I like where we sit among the 2. Our safety profile is, I think, clearly better. Our therapy is clearly simpler because of monitoring and because of convenience of dosing. And historically, we've been substantially stronger in lowering triglycerides.

Since you've shared the detailed results at ESC, maybe just chat about some of the doctor feedback you've gotten on your profile.

Yes. I think in general, it's been consistent along the lines of what we were getting post FCS approval. I think with an emphasis on the favorable safety profile that, that makes things easier for physicians, for prescribers if they don't have to worry about patients bouncing back with transaminase elevations or injection site AEs or thrombocytopenia that it makes their life, in general, easier not to have to worry about those things or to have to worry about dose adjustments. We have one dose that was studied in the study.

Yes.

And also, I think that the pancreatitis data were helpful. It wasn't -- so we had a very strong risk reduction in the high-risk population. We had no events in the high-risk patients on plozasiran. But we also showed that patients with triglycerides between 500 and 880 also do get pancreatitis. And I think it's important for the field to see that, that it's not just those patients with trigs above 880 that need to be cared for. Those patients with trigs between 500 and 880, also we need to get their triglycerides under control to decrease the risk of pancreatitis.

Can you also just touch on pricing, right? You kind of set the price before you had the final data. So what -- any updated thoughts there? How are you feeling about current pricing?

The price right now, the net price is $45,000 per year, and we think that's priced right. This to us feels more analogous to a MASH drug than a cardiovascular drug. Our challenge is this. Triglycerides show up on a lipid panel. And so people jump to, okay, well, this is a lipid drug and therefore, this price band makes sense. Well, that's not exactly the case here. This drug is not intended to decrease the risk of cardiovascular disease. This drug is intended to decrease risk of pancreatitis. It's a pancreatitis drug. And that is a severe medical condition that is expensive and painful and can be fatal.

And given that and given how strongly it reduced the risk of pancreatitis, this to us makes economic sense. Our number of patients needed to treat was 3 in the high-risk population. That's a really compelling value proposition when risk of -- one bout of pancreatitis can cost upwards of $60,000 or $80,000. And that's -- and this number of patients needed to treat is after only 1 year. Who knows what that's going to be over 2 or 3 years. It could be even more compelling than that. In fact, SHASTA-5 is an event-driven study. And so we'll have more data on a longer-term number of patients needed to treat for that, I think.

Yes. I guess maybe when you're launching next year, obviously, you mentioned Tryngolza out there, so there's a competitor there a little bit ahead of you, but you made up some time with the PRV, I guess. Where do you expect REDEMPLO to kind of be used relative to Tryngolza?

In terms of market share?

In just patient population, are you going to get switches? Is it more high risk? Is it broader?

Yes. So our commercial focus now is not switch. We will see those, but that's not our focus. Our focus is bringing this drug to patients who need it. We are starting discussions with payers now on contracting in SHTG. I think we can do that right now because we have the priority voucher. I think without that, we probably wouldn't be able to have those discussions quite yet. I think that's a help for us. I think that could help our launch, and it could be a bit of a quicker launch given that. But let me just temper expectations.

This is not one of those launches that is going to be a hockey stick, I don't think. It's a slow burn over the next couple of 3 years because it is an education play. Now sure, there is a bolus of patients that are high risk, have history of pancreatitis. These patients and their physicians are actively looking for treatments. And so yes, they are out there and they should be fairly easy to convert. But these patients aren't seeing these physicians quarterly or even every 6 months. They're seeing them maybe once a year. And so it's just going to take some time to bring this drug to them.

And again, as I mentioned, look, I think that it is helpful to patients, it's helpful to the health care system to have 2 drugs that both work. And so having Ionis out there promoting is a good thing for all of us and a good thing for patients.

Yes. Makes sense. And do you think there's a good proxy out there in terms of how we should think about the early sort of launch trajectory? Or is it this is something unique?

I guess nothing is really unique, right? But it's hard for me to put my finger on a really good analogy. Now we are promoting this with specialists, endocrinologists, cardiologists. And so it is less of a heavy lift than if we were going after primary care physicians. But still, people just aren't used to treating this because why you measure something that you can't treat. And now all of a sudden, we've got a really good drug that can treat this. And so it will just take a bit of time for people to get used to that.

Got you. Maybe we can shift gears now to some of your other pipeline programs, maybe ARO-MAPT. Maybe just give us a background there on that program. And what makes it unique?

Sure, James, do you want to...

Yes. Yes, happy to cover that. So of course, ARO-MAPT silences the expression of the MAPT gene, which codes for tau protein and tau protein when it becomes misfolded and tangles into the neurofibrillary tangles inside the cell is one of the key drivers of Alzheimer's disease, but also misfolded aggregated tau can lead to other so-called tauopathies, things like progressive supranuclear palsy or MAPT variant-driven frontotemporal dementia. So there's some -- Alzheimer's is the big indication, but there's some smaller, more rare disease orphan indications that we can go after there.

The key unique feature that there's an ASO out there that silences tau that's administered intrathecally, so requiring a lumbar puncture and -- but we don't do that. Our drug is subcutaneously administered. We use a Fab fragment to facilitate delivery of the siRNA using the transferrin receptor across the blood-brain barrier into the cells. So we're coming from the blood side rather than the CSF side to facilitate delivery.

And I think there's 2 key advantages there. I mean, one, you don't have to undergo a lumbar puncture several times a year for treatment to administer the drug. But the other and maybe more substantial advantage is the distribution that we see, at least in monkeys when we administer subcutaneously. We get a pretty homogeneous concentration and knockdown across various different brain regions and compare that to the intrathecal route, where you get a lot of drug in the cord, as you'd expect, right, since it's sort of right there. When you're giving the drug, you get some into the more superficial layers of the cortex, but not a lot into the deep layers of cortex in the deep brain like the striatum. So that may be an advantage for this intrathecal -- BBB shuttled route of administration.

And let's just be clear here. I don't think you can overestimate the potential value or power of what we're trying to do here. If we can show proof of concept, if it's well tolerated, if we're seeing good knockdown, that clearly means a lot for ARO-MAPT. And there's an awful lot of patients that could be helped both Alzheimer's patients as well as some of these other tauopathy patients. But the broader value here is clear. We are the first and at least right now, only ones, if this works out, to be able to knock down a single gene in the deep brain. There are a number of important targets that we can go after, and we're developing as we speak.

We're not waiting for positive data for MAPT. We are -- just as we're doing with dimers, we are developing these, assuming that this is going to work. Now we don't know that. We should have some data at the very end of this month or early in October. We'll see if those do translate -- those data suggest that this drug translates from animals to humans. If it does, then we need to move very quickly because there's an awful lot of need here, and there's an awful lot of opportunities for us to get into a number of different CNS targets.

Yes. And James, you've mentioned sort of an ASO that recently had some data -- Phase II data. So maybe just share what were your sort of key takeaways from that update and maybe how it reads through.

Yes. I thought those data were generally positive and generally supportive of the tau hypothesis of going after tau with a knockdown approach. I mean they've shown tau knockdown in the total CSF tau, translated that into improvements in PET signals and then had subsequently translated that into improvements in various cognitive rating scales of 20% to 40%, depending on which scale you're looking at. So that all seems really encouraging.

I think there was some debate around the dose response or maybe lack of dose response, but at least at one of the dose levels, they were kind of ticking off all the boxes that I think you'd want to hit. And I think even the safety, it seemed like with tau knockdown is probably -- was probably fine, particularly for such bad diseases. We'll see if we can do better than that with the BBB approach, approaching the cells from the blood side and if that better distribution of knockdown makes any difference in terms of efficacy.

Yes. In terms of the level of knockdown, kind of what are you looking for? And if you can get more, is that better, not necessarily? Or is it more to -- what you just said is more distribution might be better and maybe similar or even less knockdown could work? Or just how do you think about that?

Right. Yes. I think -- so for us, we feel like that 50% to 60% knockdown in CSF tau, that's the threshold to get over. That's sort of the hurdle to get over. We feel like we at least need to hit that. That being said, we're doing a full dose escalation, dose range finding study. So we want to understand the effect of different doses of the drug on target expression. And we'll pick a dose or probably a few doses to carry forward in the Phase II.

And also, 50% to 60% knockdown with an ASO that's administered intrathecally may not be the same as 50% to 60% knockdown of a drug that is better distributed throughout the brain. So in other words, it could be that the majority of the knockdown you see with IT injection is in the cord and areas that may not be super relevant to the disease. But if you're getting more consistent and homogeneous knockdown throughout the brain, that could lead to even better clinical outcomes than one would expect.

Yes. Okay. Maybe we can switch gears now. Just the obesity program. Chris, earlier, you mentioned that there's 2 targets in development. So maybe just give us a little bit of background on those targets. And then broadly, the strategy in obesity just given the level of competition these days.

James?

Yes. So the 2 programs that we have, ARO-INHBE and ARO-ALK7, both target this INHBE pathway where the liver is essentially signaling to the adipocytes to store fat and ALK7 is the receptor on the adipocyte and INHBE or Activin E rather is the ligand. And so we're looking at 2 different ways of intersecting that signal with INHBE silencing the liver component and ALK7 silencing the receptor on the adipocyte.

INHBE is a little bit ahead of the ALK7 program. We released some of the top line data earlier in the year, and we'll have still an update with some additional INHBE, but more ALK7 data towards the end of the year. We're also in the process of launching a Phase II study with ARO-INHBE that's mostly focused on MASH. In fact, we have some of the key biopsy-driven MASH endpoints in that study as well as liver fat as an endpoint in that study, but we'll also use MRI to assess all the different body composition endpoints like visceral fat, total fat, lean mass. So we'll get a good idea of what's happening in terms of body composition in that INHBE Phase II study.

So that program may be a MASH-focused drug with some improvements in body composition. I think we already showed the improvements in visceral fat, as an example, in the Phase I. And then ALK7, it still remains to be seen, although that still may be the -- more of the pure-play weight loss, fat loss story. I think we're still generating data there. And again, we'll share some data at the end of the year.

And I think that's an important point. I think if I were on the stage a year ago, I would have told you that ALK7 and INHBE are probably a bake-off. Let's see what these look like and whichever one is more active in weight loss, we're going to take into Phase II, but not the other one. What we found is that INHBE appears to be a pretty -- potentially a pretty powerful MASH drug. And so we like the idea of focusing INHBE should the data continue like this, focus INHBE on MASH and then let's see if ALK7 becomes, as James said, more of this pure-play fat loss, weight loss drug.

Yes. Okay. Great. So a lot to look forward to here. But maybe in the last 4 minutes, I can just fire off a couple of sort of survey questions we've been asking all our biotech companies on key themes in the space. So like the first question is just the impact of innovation from China and how you're staying ahead of that? Or what's your view on the potential there?

Yes. So at any given time, there is, I don't know, a dozen Chinese siRNA companies. And many of them are fast. Look, that's just good -- for all patients, right? That's good for patients. The more folks going after these intractable problems, the better for all of us. But look, we've been banging our head against the RNAi wall for over 15 years now. We've learned an awful lot over those 15 years, and we've been spending time trying to get outside the liver, and we can now address 7 different cell types. We've got clinical programs in 5 of those cell types. We're the only ones to be able to employ this dimer technology. We can get into CNS now as we talked about. There's an awful lot of things that we are just pushing the boundaries of RNAi. And there is just no substitute for history to get there.

We've been at this for a long enough time that even with this upswell of activity in China, we will have multiyear head starts in all these. Now it's multiyear head start. It's not forever. And so we need to keep on our game move as quickly as we can. And as I said, with CNS, our -- should these data be positive with MAPT, we need to run because there will be other competitors. And again, that's a good thing for patients. There will be other competitors following us. And so we need to get into the most validated targets as quickly as we can and move as quickly as we can into pivotal studies. So we are, of course, monitoring all competitors and China is one of those. But innovation is on our side, at least right now.

Yes. Great. And then the second question is just around AI and how you're using it and what impacts it has or may have on your company going forward?

We do use it. James, do you want to talk about that?

Yes. It's been primarily used in the realms of new target discovery to help add -- run target screens and sort out targets that we want to take forward based on a variety of factors. We've also used it in the area of novel ligand design and sequence selection. So I think there's a lot more we could do there, though. We do have a dedicated team at Arrowhead that's sort of focused on applying AI in those areas and the areas of discovery. So we probably just kind of scratched the surface and look forward to all the additional ways we can apply AI.

And let me add to that and also touch back to the Chinese biotech question. So there is some thought that AI -- that utilizing AI well can help people leapfrog more entrenched players. And I think that's true in a lot of areas, but that's harder in this area. So we have made hundreds of thousands of RNAi molecules in the years, hundreds of thousands. And we've learned an awful lot about what makes some potent and some not so potent in terms of patterns, in terms of chemistries and such.

And there is no substitute for that sort of data set with an AI engine because an AI engine is only as powerful as the data you can throw into it. And so with these hundreds of thousands of triggers and all this experience, we can educate ourselves. It is very difficult for an upstart to use AI and to chip away at that because brute force is a hell of a thing.

Yes.

There's also no substitute for running the clinical trial. I mean if it shaves a few months off of the discovery, that's great, but you still have to kind of grind through all the stages of development.

Yes. Okay. Great. Looks like we're out of time. So Chris and James, thanks so much. Really appreciate your time today.

Thank you.

Thank you very much.

All right. Good day, everyone. Welcome to day 2 of Cantor Global Healthcare Conference. For the next session, we're very excited to host Arrowhead Pharmaceuticals. Representing Arrowhead, we have Daniel Apel, CFO; and Andy Davis, SVP and Cardiovascular Metabolic Franchise Lead. So gentlemen, thank you so much for joining us today.

Thank you for having us.

Maybe we could start off with some of the hot topics, and you had a presentation at ESC for plozasiran in SHTG. What has been the physician feedback since the ESC presentation? And what attributes of the profile you feel are really aligning well with the physician community?

Yes. Thanks, Prakhar. Yes, we did report out our SHASTA-3 and SHASTA-4 clinical study results at the European Society of Cardiology. And the physician feedback has been incredibly positive. This is actually good timing. We conducted market research here in New York just last week with physicians getting their sense of the data. And similarly, this week, we're conducting market research in Los Angeles. So we have received lots of physician feedback. And I would say it circles generally around 3 key areas: efficacy, safety and dosing.

From an efficacy perspective, the attributes they tend to focus on the most was the potency around the TG reduction, so up to 81% triglyceride reduction. The reduction in acute pancreatitis, so 78% reduction in acute pancreatitis, which was statistically significant across the pooled analysis. And then importantly, they talk about more than 90% of subjects in the treatment arm getting below 500 milligrams per deciliter, which is a guideline-directed threshold for acute pancreatitis risk. So those are kind of the 3 data points that they tend to focus on as it relates to efficacy.

And from a safety perspective, they tend to circle on a number of differentiating aspects, in particular, the fact that with plozasiran in those studies, we saw no meaningful increases in liver enzymes, no statistically significant difference in hepatic fat reduction, no thrombocytopenia reduction in platelets and no hypersensitivity reactions, which they view as differentiating within the class. So that -- those have been some compelling messages that we've heard back from physicians through this research. And then lastly, the every 3-month dosing does present some unique opportunities for patient benefit as far as only 4 injections a year and the potential for improved adherence over time as well.

Okay. Got it. Yes, I mean, we thought some of the safety data was also differentiated. But maybe on the liver fat, I mean after the ESC, there's some -- still some questions whether this matters or not in terms of the real world. For olezarsen, you see an increase in liver fat, but it's transient and it decreases. We've seen lower liver fat, but it could also be as differences in sample size of the patients that underwent MRI. I guess all things being considered, again, is that meaningful enough of a differentiator for you?

Yes. I mean I think we can talk about what we saw or didn't see in SHASTA-3, SHASTA-4, and it's -- we didn't see an increase in hepatic fat fraction olezarsen did. I think it still remains to be seen how that will play out over time. I mean the open-label extension data was presented out to 24 months, and there was still elevated hepatic fat in the open-label extension. And so we'll see how that plays out from an olezarsen perspective, but we can at least confidently say from a SHASTA-3, SHASTA-4 in our MRI-PDFF substudy, we did not see a statistically significant difference in hepatic fat fraction.

There is some potential analog here as well around the difference between ASOs and siRNAs as it relates to hepatic fat fraction. You may recall from the previous vupanorsen data related to ANGPTL3, that being an ASO, there was an increase in hepatic fat fraction that led to the discontinuation of that therapy. We similarly have an siRNA to ANGPTL3 zodasiran. And to date, we haven't seen an increase in hepatic fat fraction. And so it's possible this is attributed to the mode of action between ASOs and siRNAs. I think it still remains uncertain at this point. But the one thing we can say confidently is coming out of SHASTA-3, SHASTA-4 in that substudy, which was powered for safety, there was no difference.

Okay. And some of the other attributes like injection site reactions, hypersensitivity, I mean, you already have some of that experience in the FCS setting, right, because the drug is approved. So I guess, is that -- again, does that come up a lot in terms of the FCS population, which should have implications for SHTG as well as we think about the 2 drugs?

So when you say does it come up a lot, meaning does it come up in relation to olezarsen resulting in switches to plozasiran because we don't have sensitivity. Yes. I mean there -- so we see about 10% of prescriptions presently are olezarsen switches. So the vast majority are APOC3 treatment naive, and that's our focus. And there are a variety of reasons for the switches, some of which are attributed to tolerability and safety issues related to hypersensitivity or thrombocytopenia. So yes, the answer to your question is it has come up. But I would say our principal focus from a commercial strategy is on the APOC3 naive population. And that does make up the vast majority of prescriptions that we see.

Right. And one thing your competitor will flag is that the dosing flexibility for olezarsen, 50 milligram and 80 milligram, so the ability to down-titrate to 50 milligram if there is patients have that flexibility. Plozasiran was just a flat dose. So I guess what are your thoughts on that?

Yes. So the reason -- the label for Tryngolza is quite clear. The recommended starting dose is 50 milligrams. And only if you can tolerate 50 milligrams, then you need additional TG lowering should you uptitrate to the 80-milligram dose. The reason that exists is because there was a dose-dependent increase in liver enzymes and hepatic fat fraction. That's not a flexibility argument. That's a mandate from the FDA on how you start the medicine and titrate the medicine. I would say from a plozasiran perspective, we believe the story is simplicity, single 25-milligram dose, no titration required, no need for liver enzyme monitoring. And so that story, that story of simplicity, we think, is likely to be a more compelling message for both physicians and patients, and that's what we hear through market research as well.

Okay. Great. And maybe moving on to the launch prep and the commercial aspects for SHTG. What work are you doing right now to prepare for the launch?

Yes. There's a lot of work happening to prep for the launch. As you know, Prakhar, we purchased the priority review voucher, which sets us up for a potential launch in SHTG in the second quarter of next year. And so there's been quite a lot of work in ensuring that our infrastructure is ready to go. And the good news there is we had already begun building out our infrastructure in anticipation of SHTG because the launch in FCS was hitting key milestones that served as trigger points for us to increase our investment in infrastructure. And so our SHTG field force, for the most part, is already largely intact. There are still a few gaps to fill around the edges.

But if we were to receive an SHTG approval tomorrow, we'd be prepared to go as far as targeting the nearly 20,000 health care professionals who think will play an important role in diagnosing and treating SHTG patients. We think we can access another up to 50,000 patients through nonpersonal promotions through the activities that we've already been implementing in FCS around digital means of communicating with our stakeholders. And then, of course, following the SHASTA-3 and SHASTA-4 data release, we're now actively engaging with payers through the pre-approval information exchange opportunity. And so our teams are already out there communicating the SHASTA-3, SHASTA-4 data and navigating the payer dynamics to set us up as best as possible to gain coverage in 2027 as early as possible.

Right. And kind of the ESC presentation, you had a great slide about the different quartiles of the targets that you will -- or the segments of the market that you can target. So maybe just talk about that. Which segments do you see as like initial adopters of this therapy? What's the addressable population in those segments?

Yes, great question. So recall from SHASTA-3 SHASTA-4, the population was greater than 500 milligrams per deciliter. But physicians do further segment those patients based on risk. And risk, as you know, in that 2x2 matrix I showed on the webinar is defined really by 2 attributes, TG and prior history of acute pancreatitis. And so of the roughly 3 million people in the United States who we believe have TGs above 500, the highest risk group are going to be those individuals that have elevated TGs and/or prior history of acute pancreatitis. So TGs greater than 880, which we think represents about 800,000 people in the U.S. or those who are greater than 500 that have a prior history of AP, so secondary prevention type patients. And we think there are probably around 200,000 of those.

So roughly 800,000 to 1 million patients in the United States who we would categorize as being high-risk SHTG, who have the highest urgency for clinical need, likely the higher willingness to pay from a payer perspective. And that's the group that we've sized our field force to go after. And when I talk about 20,000 health care professionals in the United States who will be going after, it's really that high-risk SHTG segment as the beachhead for our initial promotional activities, of course, with an eye towards expanding into the 500 to 880 without a prior history of AP who are also still at risk of AP, but less so than the other cohorts in that 2x2 diagram I showed. So the beachhead will be the high-risk SHTG group.

Okay. And for patients who had a prior history of AP, I think the number you said it was close to 200,000. Like I mean, I think there's still a little bit of an uncertainty on what that number could be. So what's your number based on? Is it based on some sort of claims analysis? Because it seems like there's diagnosis like what's actually causing these acute pancreatitis events and the subsequent hospitalization. It's a little bit hard to track.

Yes, it is difficult to pinpoint an exact number. So our estimates are based off of secondary research, understanding historical event rates within populations who have different levels of triglycerides in addition to claims analysis. So we've done kind of a breadth of analyses in order to come to those figures. But there is -- I would acknowledge there is still some uncertainty there. In some cases, it's not exactly clear whether AP events are attributed to high triglycerides. You can draw some -- you can make some decisions based on lab values as well. But there's still some uncertainty there.

I would just add, though, Prakhar, the piece that I think gets missed in all of that is we believe there are still also a fair number of patients who actually aren't presenting to the system who have acute pancreatitis events or sort of subclinical acute pancreatitis where they have the pain, abdominal pain, sort of unexplained origin radiating to the back. I can't tell you how many FCS patients, SHTG patients I have talked to who uniformly indicate when they feel that radiating pain, they know what the hospital will do for them, which is not feed them and give them fluids and stabilize them and move them on. In their view, they can do that at home.

So there is this group of patients out there that's sort of unquantifiable at this point, who are not presenting to the healthcare system because they're managing their acute pancreatitis or abdominal pain at home through just water gatorade, water gatorade, bone broth are some of the solutions that I've heard patients talk about in the past. So even though the data tells us one thing, and again, it's an imperfect science trying to capture what that data tells us, there's also no doubt a group of patients who are not presenting, who I think would present if there were a better solution like the APOC3 inhibitors.

Got it. And I guess for patients who are identified in the system once they've had an AP event, how are these patients right now actively managed? And like do you have to bring back these patients into the system and the treatment care? Because like why shouldn't any patients who have had a history of prior AP be on these drugs? What's the constraint maybe apart from access, but just.

Yes. Apart from access, I mean, the current paradigm for these patients is stabilization in the emergency room. In some cases, triglycerides aren't even checked. Once stabilized in the emergency room discharged for follow-up with a gastroenterologist or if someone was keen enough to do a triglyceride test and suspect that TGs could be the source for acute pancreatitis referral to the endocrinology department or lipid clinic. So I would say there's work to do around ensuring that there are diagnostic pathways for these patients.

Of course, those who have had acute pancreatitis events more recently are going to be more in the system than those that might have had acute pancreatitis events further back. And so it might require a little bit of effort from a systems perspective to identify those patients in the EHR system and call them back in to see what their status is and whether or not they could benefit from APOC3 treatment. But physicians will acknowledge that every single one of these patients who they believe have TG-induced acute pancreatitis should be treated.

Okay. And maybe on the priority review voucher that you bought as well to speed up the launch, I feel like -- you were a little bit behind, but not that far behind in the grand scheme of things versus olezarsen. So I guess what was -- what were the drivers of buying a PRV to speed of the launch? And I guess maybe does it help you in terms of getting coverage for 2027 as well and close the gap on the coverage even on the government channels, maybe.

Yes. No, I'll step in on that one. So I mean, on the government channel, this is -- we're in active engagement with them before. So regardless of whether it was later in the year or earlier, we're going to get engaged. And we're not truly seeing actually much of an issue there right now with FCS. So it will be a matter of just making sure we update the policies and getting the right coverage. For the PRV, it was a -- it's kind of at the end of the day, a no-brainer. So just by shifting in -- we have our product with a particular path in life, just by shifting in by 4 months, it had a 3x ROI. So -- and that's even before you talk about potentially reducing their first-mover advantage, potentially getting a few more basis points from being out there and competing earlier. That actually magnifies it considerably.

So financially, it made all the sense in the world. It brings the medicine to the patients even earlier. And I think in a lot of payers' eyes, just even shortening that 4 months, there's an awareness that plozasiran is going to be out there in a fairly short time period. So it was an important decision, one which I think was pretty straightforward as we made it.

Okay. Maybe moving on to the payer side for SHTG. You had announced pricing even before the Phase III data had come out, which is $45,000 list price. Now that you have the data in hand and maybe you have done some research with payers as well. What's the feedback now on the payers from pricing? And how would they expect to covered plozasiran?

Yes. So you're right, our REDEMPLO price was a WAC of $45,000 per patient per year. We haven't received any pushback on that from an FCS perspective. So we're getting access to FCS patients through all of the large payers whom we've been engaging with. And so there's been no concern from a pricing perspective, a list price perspective in FCS. And similarly, although the conversations are still early, of course, with SHTG because the data was just released a couple of weeks ago, we don't anticipate there being concerns given the high unmet medical need for this group of patients and frankly, the cost of the system of acute pancreatitis.

I mean acute pancreatitis is a costly event. The acute event itself can be upwards of $50,000 just as a single AP event for some extended period of time in the ICU. When you start looking at published research around the cost of the acute event plus subsequent costs following the next 12 months, you can get cost very quickly upwards of USD 100,000, north of USD 100,000 for these patients. And so payers, we believe, are -- the willingness to pay for these patients will be high. And I think so far, the policies that we're seeing for Tryngolza in SHTG leave room for optimism. I think those policies I would describe as being favorable for the class presently. Again, it's still early innings, but the policies that have been published are effectively, for the most part, greater than 500 treatment with either a fibrate or an omega-3 fatty acid, which would be consistent with guideline-directed therapy and not a concern because most of these high-risk patients will have been treated with these agents anyway. And then a specialist prescriber, so lipidologists, endocrinologists, preventive cardiology. And so I would describe those prior authorization forms that are presently out there as being favorable for the class.

Okay. And I guess, how do you convince payers to covered these drugs for more moderate triglycerides that fall in the 500 to 880 bucket given the event rate for these patients tends to be low, like the health economic analysis after you had your first AP given the cost to the system makes sense. But how do you convince payers that, all right, you covered these patients despite the fact that the event rates are so low?

Yes, you're right in the sense that this group that's 500 to 880 without a prior history of AP would be considered lower risk than the high-risk subgroup that I had mentioned before. That being said, physicians certainly still view this group as being at considerable risk despite the fact that it's lower risk than that other group. And that's partly because, remember, this 500 to 880, these are fasting measurements. And when you talk to experts in the field who can see the swings in triglycerides in a postprandial context, they will often communicate swings of 200 to 300 milligrams per deciliter. And so you're talking about a patient who might be at 500 in a fasting state. But for 16 hours out of a 24-hour day, they might be at 700 or 800.

And the difference between a patient who's in that zone, let's say, versus an ASCVD patient is that the risk of an MI might be attributed to sort of a lifelong buildup of plaque in arteries. In the case of TGs, it doesn't take much for a bolus of chylomicrons to cause havoc on the pancreas resulting in acute pancreatitis event. And once you've had that first acute pancreatitis event, you are so much more susceptible to having the next. So I think physicians have told us, even in that 500 to 880 group, they still view that as risky because of the movement postprandial and the nature that acute pancreatitis can happen at any given moment based on these bolus of chylomicron. And so they want to prevent that first event. And so we think that will be an area where physicians will still want to prescribe. Again, it won't be our area of focus commercially out of the gate because we'll be focused primarily on the highest risk segment initially. But it won't be long before I think we begin to put effort over time into educating physicians around the benefit of the APOC3 class and REDEMPLO in particular, in that particular cohort.

Okay. And a lot of people are thinking about analogs to predict this launch, novel category, novel drugs, great profile. There are some analogs that have been cited by investors to assess the uptake. So we have heard from inclisiran, PCSK9, Vascepa, from Amarin and even Rezdiffra from NASH. So what do you think are a good precedent? And what do you think is not a relevant analog?

Yes. It's not clear that any of the analogs you've highlighted, which we've also identified are actually great analogs. And just a few reasons why in the case of inclisiran, of course, Part B reimbursed medicine, very different dynamic for Part D. I think Novartis out of the gates probably underestimated the need for AICs, these injection centers, in order to support buy and bill. So I think the ramp for inclisiran was probably slower than what we would expect in this class as a consequence of those sort of structural dynamics. The PCSK9 class is an interesting one. On its face, you would think 2-player market Repatha and Praluent for the most part, initially in cardiometabolic. That would seem like a natural analog.

But I think that also fails to be a good analog because of a variety of reasons, not the least of which is the standard of care in that space was a fairly good standard of care. I mean most would argue that high-intensity statins, high-intensity statins plus ezetimibe can be a very effective regimen for reducing LDL-C in the levels that are consistent with guideline-directed goals. We don't see that same -- and by the way, those class of medicines have demonstrated MACE benefit in large outcome studies.

The big difference here with triglycerides is you've got fibrates and omega-3s, which are not considered to be that effective in triglyceride reduction, 20% to 40% at best. And neither of those 2 classes has been proven to reduce acute pancreatitis. So you have a standard of care, which is really suboptimal for this class, and you introduce now these APOC3 inhibitors, which can reduce TGs by upwards of 80% and have now proven to reduce acute pancreatitis in a variety of clinical studies. And I think it's just, again, not a comparable analog. So I wish I had a better answer for you around what some comparable analogs might be, but we haven't exactly identified a good one yet.

Am I missing something that you have identified and we haven't talked about in terms of analogs?

No, I think it remains to be seen. I do think there are a lot of these patients out there, 3 million SHTG patients in the United States, close to 1 million who are considered high risk. And the current treatment paradigm is largely ineffective. And when you talk to physicians and you talk to payers, they have a desire to improve that model and the APOC3 inhibitors to date have demonstrated data that can really improve that model.

And maybe remind us about the device presentation. This is going to be administered at home or the first dose will be administered by physicians and the reimbursement will still be Part D, right?

Yes. So at-home administration, in the product leaflet for patients, there is a recommendation for the first dose to be observed by a health care professional, but it's not required. The presentation for FCS and also initially for SHTG is prefilled syringe, and we'll be introducing an auto-injector as well to provide flexibility for patients and providers as to whether they prefer the auto-injector or the prefilled syringe.

Got it. And in terms of the investments needed to launch this drug, and maybe Dan, you can chime in as well. The sales force expansion that you're doing, how much does that require? And I think, I guess one long-term debate on the SHTG launch is like it could be an expensive launch. So Dan how are you thinking internally in terms of the planning there?

No. I think -- so obviously, we've had line of sight on this for a while. We're accelerating in 4 months. We have largely created the capabilities today for that. There will be some incremental hiring as we get fully into this, but we've already ramped up our field force presence. We have the capabilities we need on the data side and the targeting side and everything of this nature. So as launches go, this will be -- I think we're -- we're almost ready today, and we still have, obviously, anywhere from 9 months to go or so.

And maybe, Andy, remind us about the sales force size right now, how many physicians are you able to target?

Yes. So we -- in FCS, we're currently targeting between 5,000 and 6,000 physicians. So think all the lipidologists, those preventive cardiologists, endocrinologists who have an interest in lipidology are connected to lipid clinics. These are the primary group and what the guidelines indicate patients should be to these types of individuals. So 5,000 to 6,000, we'll be ramping that up to 20,000 health care professionals for personal promotion.

And like Dan said, we're nearly fully staffed to accommodate that increased targeting today. So we've spent quite a lot of time doing our targeting analysis on those physicians who we think could benefit from education around APOC3, around AP risk and around REDEMPLO. And so that will be the initial target at launch. And that's what we've sized the field force to go after because that's the group that is largely correlated to the high-risk SHTG segment. So not the full 3 million patients in the United States, but roughly the 800,000 to 1 million high-risk SHTG patients in the United States.

Got it. And maybe on the current physicians that you already target, 5,000 prescribers, -- are these also high-volume prescribers for SHTG patients as well? Like what's the overlap, current overlap?

High degree of overlap, high degree of overlap. These are going to be people in lipid clinics, connected to lipid clinics. These are going to be specialists and opinion leaders in the field. So remember, FCS is just -- it's on the spectrum of SHTG. So it's almost difficult to think about these 2 conditions in sort of separate worlds because they're all just a continuum of triglycerides. And so yes, high degree of overlap between the 5,000 to 6,000 HCPs who we're currently targeting and those that will be in the 20,000.

Got it. And I guess maybe the 20,000 prescribers, like how concentrated are these physicians like nationally? Are there specific regions where you see more presence?

No, I would say it's fairly balanced across the United States, as you might expect, concentrated in key metropolitan areas, of course. So nothing special, I think, about a particular concentration. I mean one can argue there are some founder-type populations for FCS, but because it's autosomal recessive, they're really -- you really don't find large pockets of that for SHTG. It's 1 in 100 people have triglycerides greater than 500, and you can find those individuals from coast to coast. And so our field force has used our target -- our data analytics team has used our targeting analysis to lay out where we think these prescribers are. And when you look at that map, it's fairly -- there's fairly good coverage across the United States.

Okay. I did want to touch on some of the BD and out-licensing opportunities as well. I mean, I think you guys have a great BD team, done pretty good deals. As we think about -- I mean, the focus right now is on the cardiometabolic side. As you think about some of the other assets that you have in the pipeline, which assets are like open to opportunities to partner right now?

Yes. So I mean, we're not -- I would say we're not actively looking at the moment. We don't have a near-term need for out-licensing. So purely in the cardiometabolic space, the bar would be very high. So meaning plozasiran, we have no intention of out-licensing. We're going full bore in the U.S. We're starting to do the same in the major markets. We might consider some sort of distributor relationship for smaller markets. Zodasiran, which is kind of next for the cardiometabolic franchise, probably coming -- hopefully coming in 2028. That's a really easy bolt-on. So that will just follow suit. And then we get to the dimer, which is a very interesting program to follow.

We didn't really touch upon it here, but we'll have data in the next month on that. The dimer is for both LDL as well as triglyceride reduction in the mixed hyperlipidemia market, massive market, 20 million in the U.S. alone, but very, very complementary from a commercial perspective. So that would be kind of be a very high bar for us to do any out-licensing there. And then we get deeper in the portfolio. We have as well upcoming data on MAPT, which is very exciting, upcoming data on INHBE and ALK7 later this year. And both of those we're sort of committed to moving forward in the clinical phase at the moment. I'm cognizant those are very expensive -- can be very expensive Phase IIIs.

So maybe the bar isn't as high, but we're not actually actively looking for those items. So -- and finally, just to round it out, we get to the -- some of the programs that are entering the clinic now. Again, no obvious candidates for out-licensing, but we are bringing quite a few in, in the next year and somehow that could also outpace our development. So those might be considerations at that point.

Okay. That's great. I think that's all the time we have so far. But thank you, Andy. Thank you, Dan, for a great overview, and I really appreciate the time.

Thank you.

Thank you. Appreciate it.

Good morning, everyone, and welcome to the Arrowhead Pharmaceuticals Investor Webcast. [Operator Instructions] As a reminder, this call is being recorded, and a replay will be made available on the Arrowhead website following the conclusion of the event. I'd now like to turn the call over to Vince Anzalone, Senior Vice President of Finance and Investor Relations at Arrowhead Pharmaceuticals.

Thank you, Tara, and thanks, everybody, for joining us today. We're excited to present the data that we presented yesterday at the European Society of Cardiology in Munich for what we think is groundbreaking data from the SHASTA-3 and 4 studies of plozasiran.

So before we start, I just want to make sure everybody knows that we will be making forward-looking statements today. So refer to our SEC filings for risk factors. I also want to remind people that the SHTG indication has not been reviewed or approved by any regulatory authorities around the world, so it should be considered investigational. And the results here are preliminary. So they should not be used with -- for HCPs or patients or in product promotion in any way. This is an investor-focused communication today.

So we're very fortunate today to have two external speakers who are leaders in the field, Dr. Gerald Watts from the University of Western Australia in Perth, who gave our hotline late-breaker presentation yesterday. and also Dr. Børge Nordestgaard, sorry, from Copenhagen University Hospital, who is the discussant for our presentation yesterday.

And here's the flow. So today, I'll give a short introduction and a review of our -- of Arrowhead generally in the cardiometabolic pipeline. Dr. Jennifer Hellawell, who is Head of Clinical Development at Arrowhead, will talk about severe hypertriglyceridemia or SHTG. Again, Dr. Watts will do an encore presentation of the SHASTA-3 and 4 full results. Dr. Nordestgaard will talk -- will give a discussion on the results and the clinical implications. Andy Davis, our Head of Cardiometabolic commercial. We'll talk about our current -- the current status of our commercialization efforts in SHTG. And then I'll give some key takeaways.

And then we'll have a little bit of time at the end for you to ask questions to the panel. It will be a limited amount of time, so we should be able to take maybe five or six questions. [Operator Instructions]

So Arrowhead, this is a very brief introduction of Arrowhead as a company. As most of you probably know, we're an RNAi therapeutics platform company with a broad pipeline of both wholly owned and partnered candidates. And importantly, in 2025, we launched our first commercial product in REDEMPLO, which is the trade name for plozasiran. It's currently approved to reduce triglycerides in patients with FCS in the U.S., in the EU, Canada, Australia, and China.

We think this is a potential multibillion-dollar opportunity across different future indications. And importantly, we see the potential for multiple independent and partnered launches of other products outside of REDEMPLO over the coming years. Our pipeline is very broad, and I'll go over a quick overview of what it looks like in a moment. But importantly, we have a good mix of early-, mid-, late-stage and now commercial-stage assets, also targeting the most ultra-rare disease all the way up to the highest prevalence cardiovascular indications. And that pipeline has tended to grow by two to three new clinical programs per year. So we're very productive.

All of this is built on a proprietary technology platform that we call TRiM, or targeted RNAi molecules. It's optimized for deep and durable gene silencing using the RNAi pathway. And we think that Arrowhead is the clear leader in fulfilling the promise of RNAi therapeutics because we are now capable of bringing RNAi to where disease lives, not just inside the liver. And I'll show you a slide of the different tissue types we can get to. But we do believe that Arrowhead has best-in-class with liver-expressed genes as well as outside the liver.

And then lastly -- and this is important for any development stage biotech company. We have a strong balance sheet and the financial resources to get to multiple important commercial launches as well as clinical milestones. And that -- those financial resources are complemented and supplemented by additional nondilutive capital that we expect from existing partnerships with leading pharmaceutical companies.

So this is a schematic of the seven different cell types that we are working to get the TRiM platform to: liver, lung, skeletal muscle, CNS, adipose tissue, ocular and cardio-myocyte. And again, we think Arrowhead is the clear leader in fulfilling the long-term promise of RNAi by bringing it to tissues where disease starts. And here's a very long pipeline. But again, the takeaway is that we have a broad pipeline and lots of opportunities for growth.

So before I turn it over to Dr. Watts, I just want to give a very brief summary of what we think are the important points of the data that were presented yesterday. So in the SHASTA-3 and 4 studies, we achieved triglyceride reductions of about 80% from baseline across the SHTG spectrum. And importantly, more than 90% of the patients on that study got TG levels below 500 mg per deciliter, which is a key risk threshold for acute pancreatitis. We -- in the studies, we reduced the cumulative AP events, again, across the population by 78%, with a really impressive 100% reduction in the patients at highest risk. And those are patients where their TGs are above 880 mg per deciliter and have a prior documented history of acute pancreatitis. Again, that 100% risk reduction was extremely impressive and what we think is paradigm shifting for the treatment of SHTG.

Next, we have a consistent and favorable safety and tolerability profile. And frankly, if you look at our AE tables, which Gerald will talk about shortly, the everything from prior studies in different patient populations has held and the safety and tolerability profile continues to look either equivalent to what we've seen previously or even better. It's very safe and well tolerated, which is an important point here. And then lastly, these data have also been accepted for publication in a major medical journal with more details to follow shortly.

So now I will turn it over to Jennifer Hellawell, who'll talk about the disease of SHTG.

Thanks, Vince. Good morning, everyone. Today, I'd like to take a step back and provide an overview of severe hypertriglyceridemia, a vastly misunderstood condition that affects almost 1 in 100 patients worldwide. Hypertriglyceridemia actually represents a spectrum of disease with severe clinical manifestations and considerable unmet need across the spectrum. At one end of the spectrum are patients with moderate hypertriglyceridemia, usually defined as triglycerides in the range of 150 to 500 milligrams per deciliter. And this is a condition that affects upwards of 10 million people in the U.S., with substantial ASCVD burden and overlap with other cardiometabolic risk factors.

At the other end of the spectrum are patients with familial chylomicronemia syndrome, or FCS, a rare condition characterized by persistent chylomicronemia or triglycerides greater than 880 milligrams per deciliter and an extremely high risk of acute pancreatitis. This condition, of course, can be genetically or clinically diagnosed. However, in the middle of the distribution is severe hypertriglyceridemia. This is generally defined as serum triglyceride levels of greater than 500 milligrams per deciliter, and this is a condition that affects approximately 1 in 100 persons or greater than 3 million people in the United States alone.

Severe hypertriglyceridemia can have similarly dire clinical consequences, including an increased risk of life-threatening acute pancreatitis. Much like atherosclerosis, risk in these patients is driven primarily by both higher levels of the causal lipoprotein, in this case, triglycerides and history of prior clinical events, in this case, acute pancreatitis episodes.

For this reason, patients with the highest triglycerides and prior AP events are often referred to as high-risk severe hypertriglyceridemia. And this subset is thought to represent about 1 million people in the United States. These patients have an extremely high risk of acute pancreatitis as well. With many patients suffering multiple recurrent attacks and a variety of related severe clinical sequelae throughout their lifetimes.

Unfortunately, conventional triglyceride-lowering therapies such as fibrates and omega-3 fatty acids rely primarily on functional lipoprotein lipase or LPL pathways, which are often dysfunctional in these patients thereby leading to very modest effects on triglyceride levels. Importantly, until recently, none have been shown to reduce the risk of acute pancreatitis. Apolipoprotein C-III or APOC3 is a key lipoprotein involved in triglyceride hydrolysis and clearance through both LPL-dependent and independent pathways and has recently emerged as a therapeutic target across the spectrum of hypertriglyceridemic disorders.

While severe hypertriglyceridemia can sometimes be diagnosed as an incidental finding on routine lipid panels, the patient journey with severe hypertriglyceridemia is typically characterized by an evolution from a hidden more asymptomatic phase to acute medical emergencies of debilitating abdominal pain, prompting emergency room visits, hospitalizations and even stays in intensive care units. This period of acute stabilization is then followed typically by discharge to complex, sometimes confusing long-term outpatient management.

The cornerstone of management historically involves extreme dietary restrictions, limiting total fat intake to just 10% to 15% of daily calories or under 20 to 30 grams daily alongside the complete elimination of alcohol and added sugars. Patients must also aggressively manage secondary risk factors like uncontrolled type 2 diabetes and obesity to improve overall insulin sensitivity. Patients silently struggle with considerable impacts to quality of life as they grapple with fatigue, low energy and chronic anxiety about the pancreatitis while managing a challenging and limiting lifestyle and medical regimen.

With this shared understanding of the dire unmet need and the therapeutic potential of targeting APOC3 with Arrowhead's proprietary TRiM siRNA technology, we undertook our Phase III SHASTA program of plozasiran in adults with severe hypertriglyceridemia. Now it is my pleasure to turn it over to Dr. Gerald Watts to share the results from those studies.

Thank you very much. I'm most grateful to be here, Mr. Chairman, ladies and gentlemen, potential investors. Jennifer has set a marvelous precedent here for the need for new therapy in this patient group. So this is what -- this is the type of the work that was presented there with a string of co-authors entitled Plozasiran for severe hypertriglyceridemia on the basis of what Jennifer has said already in risk of pancreatitis, probably its most severe sequela.

The SHASTA-3 and the SHASTA-4 pivotal trials, 12 months results. I should -- I'd like to mention things that are important, SHASTA, 2 lovely lookout mountains in Northern California. And this may well be representative of the potential of this trial to be a landmark trial as those mountains are. So the background again to reiterate what Jennifer said that severe hypertriglyceridemia defined above the cutoff points shown up there, 5.6 mmol/L and 500 milligrams per deciliter, is about 1% of the population translating probably to 5 million to 10 million people worldwide, increases the risk of acute pancreatitis.

These chylomicron particles and triglyceride particles lodge in the pancreas and set off an inflammatory event. It's a heterogeneous disorders driven by multiple factors, genetic factors and secondary causes, overnutrition, obesity and type 2 diabetes. The next one is an important point really that despite best standard of care, many patients don't achieve those treatment goals of less than 5.6 mmol/L. And so the risk of end organ damage, in particular in the pancreas, acute pancreatitis persists. The opportunities that have arisen is knowledge about APOC3 as a key regulator of the metabolism of triglycerides, and this has now become a validated therapeutic target with Arrowhead leading the way with its TRiM pathway.

Plozasiran is, in fact, a first-in-class hepatocyte targeted siRNA that reduces the hepatic synthesis of APOC3 and was evaluated in adults with severe hypertriglyceridemia in these two, SHASTA-3 and 4 studies. So two trials were undertaken. By way of background, apologies for those who are aware of this, this is a summary of what APOC3 does that damages triglyceride metabolism. On the left-hand side, APOC3 inhibits the breakdown of triglycerides via taking two hits at the lipoprotein lipase-dependent and lipoprotein lipase independent pathway in the liver.

So it follows that if you can remove APOC3 out of the system as you can through one injection of plozasiran as shown in the middle of the figure. And on the right-hand side, you remove this unwanted inhibitor and that derepresses the activity of lipoprotein lipase and the activity of receptors that clear triglycerides. So that's the science behind it. So that's one opportunity that one had to address the balance -- to redress the balance and the gap in treatment. And the other opportunity is the randomized controlled clinical trial.

So this was the design that was employed. Two trials were undertaken on the basis of advice from the regulators in the U.S. SHASTA-3 and SHASTA-4 patients -- adult patients with severe hypertriglyceridemia were randomized to 25 milligrams of plozasiran or placebo, exactly same design with four injections -- subcutaneous injections of plozasiran over 12 months. ending with an open-label extension study prerequisite as a bridge to potential new therapies in those -- for those who it's indicated. So that was a study design, two trials. Quite a challenge running two trials, but they were done, and the results will be presented initially individually for those trials and then as a pooled analysis for the acute pancreatitis endpoint as a pooled analysis for safety endpoints.

So who were the individuals that were studied? It's a busy slide, and apologies. I'll just let you know who they were en masse. The summary is that were mainly middle-aged people who were overweight, male, whites, a history of cardiovascular disease and approximately 1/3 diabetes in approximately just over half acute pancreatitis present in 1 in 5 individuals. It was already a proportion of them had acute pancreatitis, and this was a very important group as we shall see.

The average triglycerides, the mean value was 9 to 10 millimoles per liter, appears half the population in the chylomicronemic range and the other half up from 100 -- sorry, from 10 millimoles per liter down to 5. HbA1c, which is a measure of glycemic control is good and important to note that lipid-lowering therapy, which is the best standard of care for this condition at present, namely fibrates, omega-3 fatty acids, statins, ezetimibe and combination therapy was taken by the majority of patients as clinically indicated.

So that was a group of male -- predominantly male adult patients. This was the primary endpoint. So the primary endpoint was the triglyceride level, the percentage triglyceride level at 12 months. And you can see here at the top, here are the placebo groups of the two SHASTA trials and at the bottom is [Audio Gap]. And you can see as we could evaluate a rapid reduction in triglycerides by 3 months, that was sustained. And here we are, it was within group change of about 80%, that remains statistically significant after adjusting for the fall in placebo. I mean this was -- we've seen this before in FCS and other trials that once these patients with hypertriglyceridemia join a trial, actually, they seem to do quite well, and it's consistent and reflects the recommendation that best standard of care is important and, in fact, demonstrates that plozasiran actually adds to really super best standard of care. So that's important.

So from the primary endpoint, there's a select cocktail here, secondary endpoints, triglyceride reduction at 10 months, interesting secondary endpoint, 80% reduction. Remnant cholesterol at 12 months, about 70% reduction, about 50% if we adjusted for a fall in remnants in placebo. Non-HDL cholesterol 26%, 20% reduction and adjusting for the fall in placebo, APOC3 and triglycerides at 12 months in a very high-risk group with baseline levels of more than 20 -- more than 10 milligrams per liter. So all these changes were statistically significant relative to placebo, implying that all these secondary endpoints of the trial were met.

Now this is an important slide. These are the proportion of people in the two trials, SHASTA-3 and SHASTA-4, who attained these goals that Jennifer and Vince referred to. I mean doctors think in terms of proportion of people getting to goals, easier to think about because that's what you communicate to patients. So here, you can see 90% in the two trials, 90% achieved triglyceride goals of less than 5.6 millimoles per liter.

With the placebo actually showing a 50% -- 50% of those actually fell below those goals as you would anticipate from the previous presentations. Now turning here on the right to a goal of less than 1.7 millimoles per liter, which is entirely normal in the fasting state. You see here that plozasiran in both trials as shown here, half -- 50% of the population, over 50% achieved a complete normalization of fasting triglycerides. And this is where it very clearly outdid the effect of super best standard of care. So that was a good take-home message that you can really move the distribution from severe to moderate majority and 50% of the entire population down to a normal triglyceride level explaining why it worked out to be superior to super best standard of care.

So turning now to the pooled data. We had to join the -- both studies to looking at acute pancreatitis to maintain statistical power, a good opportunity, and this again was approved by the regulators. On the left-hand side, you see total events, the total burden of acute pancreatitis. So there may have been some patients who contributed to events. This is a Kaplan-Meier curve, which is an outcome of interest, the total burden of acute pancreatitis in the placebo group and in the intervention group and clear evidence that there is an 80% relative risk reduction, a 4.1% absolute risk reduction translating into 24 people with the characteristics of this trial that you needed to treat with plozasiran to prevent one acute pancreatitis event or concoction of events in 1 year.

On the right-hand side is the time to first event, and there was a prolongation of an average of about 5 months. And again, this was statistically significant, 82 with a hazard ratio of approximately 0.26, and that was statistically significant. The other analysis takes it a little bit further, and it's an exploratory but highly important analysis looking at the highest risk groups. In other words, those who at baseline had fasting triglycerides more than 500 milligrams per deciliter and a history of acute pancreatitis, really quite a marked reduction in the relative risk reduction, well over 90%, highly significant 34% absolute risk reduction. But clearly, this group were at a higher absolute risk and then translated into a maximum of 3 people that needed to be treated to prevent one event.

And a further analysis if one looked at those with triglycerides of greater than 10 millimoles per liter, 880 milligrams per deciliter and a history of acute pancreatitis, there was a 100% reduction in the incidence of acute pancreatitis event. Now these are small numbers, and they were exploratory, but it gives you a feel for what the great potential is of this intervention in people with the characteristics that make them at highest risk of acute pancreatitis. I give you time to absorb that because this is key data.

So moving on, again, analysis, both the SHASTA 3 and 4 come into adverse events. It's a busy table. These are standard outcomes ranging from all treatment-related adverse events to the most common ones, injection site sensitivity, platelet count, liver enzymes. And down here is a substudy of approximately 36 patients randomized to placebo, 2:1 manner and 23 to plozasiran. So I'll just take you through this very briefly that -- I'd first say that the retention rate of patients in the trial was very high, over 90% and compliance with the four injections almost 100%, with no injection site reactions, which is absolutely extraordinary, actually, much more than that we see with other siRNAs in our clinical practice and might relate to the way the TRiM platform is designed.

So treatment-emergent adverse events leading to discontinuation rates were low, 1.2%, similar between the groups. There was no anaphylaxis or systemic hypersensitivity. There was worsening of glycemia using a variety of nonspecific endpoints that appear to be slightly higher with intervention compared with placebo. No clinically meaningful changes in platelet counts. In fact, no changes at all in the platelet count of note, which was a problem with the earlier interventions that were not GalNAc-conjugated. No significant elevations in ALT or AST and none that met this sort of magic law called Hy's law. It sounds like a law actually of the land in the cowboy movie. Comes up, but it's never positive actually.

And again, important relating to this group down here, no statistically significant increases in treatment-emergent increase in hepatic fat fraction when you look at it with magnetic resonance imaging. So very, very reassuring. Just to give a little bit more context concerning glycemic control, the only hard endpoint that could have been defined, but I have to say that this was not a prespecified endpoint was glycated hemoglobin, which is a measure of long-term blood sugar control used to monitor people with diabetes.

And this refers to the absolute values and the relative changes over time, a smidgen of an increase in HbA1c that is exceptionally small and less than 0.25% on their absolute scale with periods of no significant difference at the end of the intervention, and that's the percentage change, slightly high, but no apparent change from this visual inspection at the end of intervention. So quite reassuring and certainly better than all previous studies with plozasiran and better really that seen with a competitor agent.

So we've reached the coda of all these movements of this presentation. I'll just re-emphasize what the conclusions were. Plozasiran administered every 3 months reduced triglycerides and acute pancreatitis events in patients with severe hypertriglyceridemia receiving conventional background therapy and diet. Let me go a bit further actually because it was in the trial, the background treatment was actually excellent, super excellent. Triglyceride reductions of 80% were evident at 3 months and sustained over 12 months with an associated reduction of acute pancreatitis of 80%, 1% relationship.

Over 90% of patients treated with plozasiran dropped their triglycerides below the level that's been used to demonstrate high risk of acute pancreatitis, 5.6 millimoles per liter or 500 milligrams per deciliter, and half of them normalized the level of triglyceride. This is really impressive. This normalization and sustained over the 12 months was probably the basis for the reduction in acute pancreatitis.

A conclusion related to the high-risk groups, just to drive it home that those in the high-risk group appeared to get the greatest benefit, but there was benefit across all the spectrum of triglycerides from 500 mg/dL and above. 90% of patients with a history of acute pancreatitis and 100% reduction in the -- sorry, I'll say that again. There was over 90% reduction in the relative risk of -- in all patients with the history of acute pancreatitis and 100% of the highest risk group.

Safety was reaffirmed and the findings support the value of APOC3 targeted therapy for plozasiran for preventing acute pancreatitis in severe hypertriglyceridemia with significant implications for changing clinical practice once this is approved with a label by the regulators, once this gets into clinical guidelines and a great potential to actually shift that practice in a manner consistent with a model of care that has been missing for many years for this high-risk group of patients, something that we need to develop as we move along.

So thank you for your attention, and congratulations to Arrowhead for funding this study and all the patients who contributed to these difficult studies, actually, two studies. It's really quite impressive. So thank you, Chris. Thank you.

And now I'll hand over to my friend and colleague, and those are my disclosures, Børge Nordestgaard through the Chair, of course.

Thank you so much, [indiscernible] , and thanks for the invitation to be here. As was already said, I was also invited to give the editorial comment yesterday at the Congress here in Munich, European Society of Cardiology. So that's what I showed yesterday. And I started with this slide to try to show where is the problem. So the graph is really showing the distribution of triglycerides shown on the X-axis in a typical general population study. 64% has what has been referred to here as normal levels. Less than 150 milligram per deciliter or 1.7 millimoles per liter. And then there's 34% that has mild to moderate hypertriglyceridemia up to 500 milligram per deciliter. And here, after that level, that's what is referred to as severe hypertriglyceridemia found in typically 1 in 100 in world populations.

What you also can see on this slide is that with the red arrow way out to the right, there's this genetic condition, familial chylomicronemia syndrome. We often refer to it roughly 1 in 1 million has this, perhaps a little bit more common. They can have various -- very high triglyceride levels. We now have five different drugs that has tried to reduce triglycerides in these situations. But first, we had three different types of drugs, volanesorsen that had a problem with lowering of platelets, and it was approved in Europe only, but never in the U.S. And then olezarsen from the same company and now plozasiran.

So all these three have been shown. What we are moving to now is this much more common condition, namely severe hypertriglyceridemia, 1 in 100. We already heard from Jennifer Hellawell, some numbers for United States and the world also how common it is. And olezarsen has already showed results for that roughly about a year ago. And now we have this very, very important study with plozasiran in this quite common condition. And what I show here is now that all these five drugs have now shown to reduce acute pancreatitis and the rough number for all five studies is 80% reduction. So it is extremely consistent.

Either you have the very severe genetic condition, familial syndrome or you have the broader condition, severe hypertriglyceridemia, roughly an 80% reduction by using these type of drugs that are all APOC3 inhibitors. And we already heard about how the mechanism is. So, side effects, I have what you, Dr Watts, showed us, the only thing that really was something in that was worsening of glycemic control, 14% in the active drug versus 9% in the placebo.

But this is a class effect. This is also seen for the other drugs. There's no mystery about plozasiran in general. And personally, compared to how a bad situation in these patients, and this is really nothing. And many of them already, so they will be looked after for the glycemic control anyway. What I really tried to highlight in green, there was very low drug discontinuation. And for me, when I see a study like that, that tells me there's very, very few side effects that the patient noticed.

And of course, when you have new drugs like that, we need a lot more follow-up. We need to do that long term. I'm sure both FDA in the U.S.A. and EMA in Europe, they were asking for more security. But for now, it looks really, really promising.

On top, the SHASTA-3 and SHASTA-4 baseline, the 757 with severe hypertriglyceridemia, meaning levels above 5.7 millimoles to 500 milligram per deciliter. In these studies, there were 32% that had ASCVD at baseline, 59% diabetes and 21% acute pancreatitis. So, here's one point that I'd like to mention for you. So, even at the baseline with EC, there actually was more atherosclerotic cardiovascular disease, meaning heart attack or strokes than acute pancreatitis. So down below, I put some of my own personal data. I have access to all data that lived in Denmark for the last many years. And here, I showed the ones from 2008 to '21, 3.4 million people with triglyceride measurements and all these we looked at here, they had no ASCVD myocardial infarction stroke or acute pancreatitis at baseline.

There was 29,000 with severe hypertriglyceridemia at the same level as before. And the point I would like to show to you here is that when we look at this group in Denmark, and I'm sure it will be the same in any other country in the world, then the incidence of acute pancreatitis was 2, and there was 400 cases in total we could find in all of Denmark. Denmark is a special country. We have 100% follow-up. Everybody is captured in the registries.

For atherosclerotic cardiovascular disease, heart attack or stroke, there was 2,000 cases and the incidence was 18. So it's actually in this group of patients, completely primary prevention, there was 5x as much atherosclerotic cardiovascular disease as acute pancreatitis and on an incidence basis, 9x more. Why do I say that? I think because of the way the patients were recruited, it was acute pancreatitis that we could see an effect on.

But long term, for this patient group, there's a big need for further investment trying to actually go for both diseases. Both reduce acute pancreatitis and long term also atherosclerotic cardiovascular disease. So here's my clinical implication. In blue, I show this is a huge unmet medical need. And I actually worked together with Gerald Watts and he knows very well, severe hypertriglyceridemia causing acute pancreatitis and also ASCVD. These patients in the past really never had much we could offer them and particularly ones with a very high level, so it's very difficult. In green, I show fantastic news now. We now have efficient therapies. These APOC3 inhibitors where plozasiran is one of the two that is relevant right now to lower triglycerides and acute pancreatitis. And for me, I think I would love to see more studies that actually focus on not only preventing acute pancreatitis, but also long-term atherosclerotic cardiovascular disease.

So with that, I'd like to hand over to Andy from Arrowhead.

Thank you, Dr. Nordestgaard, and good afternoon, everyone. I'd like to walk through what the SHASTA-3 and SHASTA-4 data mean for our commercial opportunity in severe hypertriglyceridemia, building on the clinical results just reviewed.

Let's start by level setting on the potential market opportunity for plozasiran. As Jennifer and Dr. Nordestgaard previously set up, severe hypertriglyceridemia isn't a single population. It's really a spectrum. At the broadest level, SHTG is defined as triglycerides at or above 500 milligrams per deciliter and affects more than 3 million people in the U.S. Within that, we define a high-risk SHTG segment, triglycerides at or above 880 milligrams per deciliter or above 500 milligrams per deciliter with a prior history of acute pancreatitis, affecting approximately 1 million people who carry meaningfully higher AP risk. And at the far end of that spectrum, of course, sits clinical and genetic FCS, where triglycerides are persistently elevated above 880 milligrams per deciliter and prior AP history is prevalent.

A population of more than 6,500 people in our estimation at extremely high AP risk. The SHASTA-3 and SHASTA-4 data we reviewed today, together with the FCS data from PALISADE behind REDEMPLO'S FCS approval, now give us clinical evidence across the entire spectrum. What's notable is that plozasiran's value proposition doesn't change as you move across that spectrum. It holds. Across these patient groups, we see deep and sustained TG reduction on the order of approximately 80% from baseline, maintained throughout the treatment period.

Over 90% of plozasiran treated patients in the SHASTA program reached triglyceride levels below 500 milligrams per deciliter, an important risk threshold at month 12. Importantly, we saw a statistically significant reduction in AP risk that is plozasiran reduced cumulative AP events by nearly 80% versus placebo. And the safety profile also remains favorable. Notably, we saw no hypersensitivity, no meaningful change in platelets, no clinically meaningful change in liver enzymes and importantly, no liver fat elevation relative to placebo.

Also, the expected physiological change in HbA1c is consistent with the APOC3 inhibitor class. And lastly, dosing remains simple, a convenient 25-milligram dose every 3 months, just 4 injections per year and with no titration required. This consistency across the SHTG spectrum matters commercially. Physicians treating the broader SHTG population won't need to relearn this medicine. The profile they already trust in FCS carries forward.

Given that consistency, our initial commercial focus for the SHTG opportunity will be deliberate and focused. We're prioritizing the high-risk SHTG segment. Shaded here, patients with triglycerides at or above 880 milligrams per deciliter and those with triglycerides between 500 and 880 milligrams per deciliter who also carry a prior history of acute pancreatitis. These are the patients with the greatest clinical urgency. Importantly, we're not starting from zero here.

A subset of this high-risk segment, as shown here in the small blue boxes, already meets the clinical criteria for FCS, and REDEMPLO is reaching these patients today. Recurrent hospitalization for unexplained abdominal pain, a family history of HTG-induced pancreatitis or a history of pancreatitis are all criteria that support a clinical FCS diagnosis and patients presenting this way are being identified and treated under our current label.

To summarize, this is not a strategy of chasing the full addressable SHTG population on day 1. It's a strategy of going first where clinical need, payer willingness to pay and the evidence supporting REDEMPLO are greatest. To put a number on that clinical urgency, in the high-risk segment defined as TGs at or above 880 or above 500 milligrams per deciliter with a prior history of acute pancreatitis seen here in the green outline, the number needed to treat with plozasiran to prevent acute pancreatitis event is 9 patients over 1 year. And for those patients with a prior history of AP, irrespective of TG cut point shown here in the blue rectangle, the number needed to treat is a remarkable 3 over 1 year.

NNT reflects how many patients need to be treated to prevent one event. The lower the number, the greater the impact per patient treated. And NNT in the single digits, like we see here, represents a landmark result and demonstrates compelling value to payers when assessing cost benefit. Also, it's a number we believe will strongly resonate with physicians who treat this population.

Turning now to our go-to-market approach. We've identified over 20,000 health care professionals across largely four specialties: Lipidologists, Endocrinologists, Preventive Cardiologists and internal medicine and primary care, who treat the roughly 1 million high-risk SHTG patients in the U.S. today. This is a targeted call plan. These four specialties concentrate the patients we're prioritizing, and it allows us to direct our commercial resources efficiently as we prepare for a potential SHTG launch.

Finally, our commercialization efforts are already well advanced. Our medical education and communication strategy is developed and our medical science liaisons are in the field conducting scientific exchange. Our marketing and market access strategy has developed, and we're executing compliantly against key go-to-market activities. The expansion and optimization of distribution channels and patient services are well underway. Regulatory interactions are planned in the near term, and we're building toward day 1 readiness across patients, providers and payers.

In short, much of the planning and infrastructure required to support a potential SHTG launch is already in motion, well ahead of any regulatory decision.

With that, I'll turn the call back to Vince.

Thanks, Andy, and thanks to all the speakers today. This is a really great set of presentations. I appreciate it.

So takeaways. So what's important? And I think it goes without saying that Arrowhead is thrilled with these data. This is going to sound like hyperbole, but this is really the slam dunk or the home run or the grand slam or whatever sports analogy you want to use for what we had hoped for with these data. It's really phenomenal. Plozasiran continues to demonstrate an attractive profile and importantly, a consistent and favorable safety and tolerability profile.

Second, as Andy just mentioned, it's an extraordinarily compelling value proposition across the board for physicians, for patients and for payers. And Andy highlighted this, but I want to highlight it again, an NNT of 24 over a year for the overall study population in SHTG is already impressive and potentially paradigm shifting for the treatment. And then when you go to the high-risk patients, the one who've had a prior history of AP, an NNT of 3. And just to put some perspective on that, this is oversimplified, but essentially, it means all you have to do in that population is treat in this, treat 3 patients to prevent one event of acute pancreatitis. And as a review, acute pancreatitis is a very severe and chronic and recurrent and frankly, very costly thing for the health care systems to treat. So again, this is a really compelling value proposition across the board.

Next, we are still on schedule to file our sNDA to request approval for the SHTG population before the end of this year. And just a reminder that we did recently purchase the priority review voucher, which potentially accelerates our path to launching in this large population in the U.S. And then again, as Andy just mentioned, our launch readiness efforts are well underway. And over the long term, we see this opportunity in SHTG just in the U.S. potentially being a $3 billion to $4 billion a year opportunity.

And we're really just getting started with lipid disorders. This is -- there's a lot of information in this slide. I'm not going to cover all of it, but just to orient yourself on the left side is elevated LDL and the diseases that, that leads to. On the far end of the spectrum, the most severely elevated LDL is HoFH or homozygous familial hypercholesterolemia. For that part of the population, we have an investigational product called Zodasiran, which we also presented some data from a small substudy in China today at the Congress. And those data look really promising, and we hope that Zodasiran becomes an important medicine for that part of the population.

As you go to the far right, that's -- these are diseases characterized by elevated TGs. And again, the most severe is FCS, both clinically and genetically diagnosed and then the SHTG population, which we talked about today. And then in the middle of this, in the intersection of elevated TGs and elevated LDL is a population called mixed hyperlipidemia. And that's a patient population with persistently elevated LDL, persistently elevated TGs and a high risk of ASCVD.

And we have a new dual functional siRNA product called ARO-dimer-PA, that's investigational. It's in a Phase I/II study right now directly in mixed hyperlipidemia patients. It's a drug that targets both the PCSK9 gene and the APOC3 gene simultaneously in one drug. It's a really phenomenal technology that we're extraordinarily excited about that we'll have our first readout for the first-in-man study next month in September. And again, more to come on that shortly.

But the takeaway here is that Arrowhead is already active across the spectrum of lipid disorders, and that's only growing. We foresee in the future additional products in the cardiometabolic space, and we're building our commercial infrastructure to support potentially multiple products.

So what does that look like in the short term? Over the coming years, even with just the programs that we've disclosed that we've talked about, we do see the possibility for multiple independent launches. As I mentioned, we launched REDEMPLO in FCS in 2025. We hope to file our sNDA for plozasiran for SHTG before the end of this year and provided we receive a positive review and approval, our hope is that we launch that in 2027. Following that, the HoFH study of Zodasiran should read out around the middle of next year, which would set us up nicely for the next commercial launch for Arrowhead in 2028.

And then beyond that, we have the dimer program I mentioned for ASCVD and then additional programs for obesity and NASH and then others that are undisclosed at this point. So this is just the start for our commercial franchise.

So thank you, everybody. We appreciate the time today, and we have about 10 minutes to open up the call to questions. So Tara, do you want to compile the question list, please?

Yes. Thanks, Vince. [Operator Instructions] So our first question comes from Brian Cheng at JPMorgan.

Congrats on the data presentation yesterday. We have a question for the physicians on the panel here. Curious, doctors -- can you walk us through how you think about the acute pancreatitis effects that we are seeing here in the SHASTA 3, 4 and how that fares against olezarsen? And how would that ultimately impact your decision-making if both options become available today?

I'd be happy to start, Dr Nordestgaard. For me right now, this is such a huge unmet medical need. There's such a huge market out there. for patients that need this treatment. So I'm actually not thinking of competitors between the two companies. I'm thinking of the two companies together -- could work together with the same strategy to all the clinicians to find as many as possible of these patients. There are so many of them out there. So I actually see it as a big advantage that there's two different companies that will try to make clinicians find the right patients and refer them to the doctors that see these types of patients. Gerald, what's your point?

Yes. I totally agree. I mean I think when there are two really good products, there's a feed forward mechanism and everyone can be a winner. I mean there are advantages in the direction of plozasiran in terms of we have not seen a deterioration in liver fat, liver enzyme changes are very good. The HbA1c is not statistically significant. But at the end of the day, it's the clinical consultation and the patient choice. I'd rather have an injection for every 3 months really rather than every month for a start you want to inject themselves every month. But there will be people who would like a short-term injection in terms of, they got fear of side effects and reversibility.

There are -- one can think of clinical situations where that would be indicated. But I would have thought the less frequent injection site reactions and the fact that these injections are not -- there are no injection site reactions of no, which is extraordinary actually, would put plozasiran in an advantaged point really, but there are sort of subtle differences. And that ultimately depends on how the doctor mounts it and what the patient's perspective is on this.

And then the price of the 2 products [indiscernible]

[indiscernible] That's a difficult one.

Let's have another question.

Thanks, Brian. Tara, do we have another question?

Yes. So our next question comes from Mike Ulz at Morgan Stanley.

Congrats on the data as well. Maybe another question for the two physicians. Just when plozasiran potentially comes available next year, are you going to be targeting your high-risk patients initially primarily? Or would you might go more broad into the mild and moderate patients as well?

I can start, Børge Nordestgaard. I mean, what should I say? It's -- again, it depends on the price. If it was very inexpensive, many, many more patients would have it. But what I do see historically is that when some new drug coming into the market, then many physicians tend to be somewhat conservative. So they will always start with the highest risk patients. The ones with the highest triglyceride will be one thing, but certainly also the one for acute pancreatitis. But as experience grow and the price is right, a lot of patients will be offered this type. Because there's really nothing we can do for them today.

Yes, I would agree with that. I mean, come back to the price clinical practice, we like to risk stratify Everywhere you go, coronary heart disease, pneumonias, you risk stratify. So people are going to be risk-stratified, and it would be significantly easier. Again, I don't want to talk too much about the cost effectiveness for you to actually fund something where the risk is high. That's they'll try to contain that.

But clinical practice is stepped. So the first thing patients will enter guideline and they're on the ACC/AHA guideline recommended dietary care fibrates and their triglycerides will drop. They will have to go through that. It's the residue that has persistent persistent elevation in triglyceride to which you would have to follow that line. I mean the study is excellent in showing the effectiveness of very good background care is. So that will have to be part of the formula.

Our next question comes from Maurice Raycroft at Jefferies.

I'll add my congrats on the great data. Wondering if you're providing more details on the breakdown of AP events. We're probably splitting hairs a bit, but in our back calculation, we see an imbalance of events in patients without prior history of AP, where there were 3 to 4 events in the plozasiran arm versus none in placebo. Is there anything unique about those patients? And is there any risk that doctors could reserve plozasiran for patients with prior AP?

So I can -- I'll turn that to James to cover. And also before James goes into it, we do have a publication pending. There will be more detail there. So there's not a ton we can talk about, but James can talk more.

Sure. Yes. You can answer the question for me, Vince. Those data, including the details around event rates in subpopulations are currently embargoed. As we mentioned, we've been accepted as a manuscript at one of the major medical journals. So stay tuned, and we'll be able to talk about that once the manuscript is out there.

And I guess I would add one other thing. I mean, keep in mind that this study, these secondary endpoints were prespecified and pooled across the study population, and we hit statistical significance across the study population. That's a critical thing to keep in mind. And that's really what we're excited about that we hit stats on that.

Our next question comes from Prakhar Agrawal at Cantor Fitzgerald.

Congrats on the data as well. Maybe a question for the KOLs here. What in your view are the key safety events where plozasiran differentiates versus Ionis' olezarsen? Are lower injection reactions and lower hypersensitivity rate enough of a differentiation for you to prefer plozasiran as the APOC3 drug of choice? And your view on the liver fat and the glycemic worsening data for plozasiran compared to olezarsen.

Well, that's an important question. I mean the rates of glycemic effect or pro-glycemic effects are the lowest recorded so far in the trial. And their assessment is based on a number of diffuse endpoints, including impaired glucose tolerance, just the need to increase anti-diabetic medication. So it's difficult to make much out of that 5% difference -- absolute difference between placebo and active intervention.

The HbA1c increase is very minor and not clinically significant. It seems to peter out and come back to baseline with improved therapy. So there are no concerns there. And I can say that as someone who is actively involved, the HbA1c goes up a little, you intensify treatment and you end up with an HbA1c at the end of the study better than when you came in.

I don't have any specific concerns about that where you have to be part of the education and upskilling. I understand that it was highly statistically significant in the other study as was the increase in liver fat. But I don't have any specific concerns about that. It is as Børge said, really, it's a very high-risk group in metabolic syndrome with diabetes and HbA1c and these things are going to happen really. There was no adverse current events. The injection site reactions were very favorable. No concerns from my point of view anyway.

Just a small comment for mine. I mean it's -- the safety profile of plozasiran is excellent. Compared to how high-risk patients we talk about treating it's no worries. I mean clinicians, patients should not be worried at all.

And in addition to that, device, the open -- the various trials that you've done informs you that it's not a continuing exponential effect. It seems to adjust itself back to business as usual. It's a temporary event. And the open-label extension of this particular trial will also inform, as Børge correctly said, the more data that we've got in the long term, the better.

Thank you. Tara, unfortunately, we're already 1 minute over, but we have time for one last question.

Great. Yes. Our last question comes from Jason Gerberry at Bank of America.

Just a quick one for the doctors. Do you guys see any clinical hurdles to switching a patient from olezarsen to REDEMPLO? Do you want to see any switch studies done? Or do you think that the decision to switch comes down to how onerous the prior authorization hurdle is to making that switch?

Do you want to start, Gerald?

Well, switching injections from one to the other does happen in clinical practice from monoclonal antibodies to siRNAs and in clinical practice, if you're not tolerating a drug -- I think with olezarsen, you may actually increase the dose if you haven't got sufficient efficacy. But again, at the 80-milligram dose, there are lots of problems with this agent as we've shown -- as they have shown. I think there would be not so much switch from or an increased escalation of dose, but whether you should switch over from olezarsen to plozasiran. And again, it's a patient preference issue. Who wants to inject themselves every month really when you can inject yourself every 3 months, and that may come up. But there will be [Audio Gap] argument's sake, I think of clinical situations, ladies planning a pregnancy, who do not want a prolonged plozasiran effect may decide to go for short-term injections. I think it's more in the favor of plozasiran than olezarsen to be quite frank.

But I would like to say -- I said it before, I really hope for now these patients can get some new drugs. So, for me, being interested in preventing of different diseases [indiscernible] cardiovascular disease, acute pancreatitis. I would much rather see that the companies try to find new patients because there's so many out there that are trying to switch from one drug to another one. And we know many patients when they get used to one drug and they don't have any major problems, they actually prefer just to stay on the same drug. So that's what we also see in clinical practice. Unless there's a really compelling evidence like clearly more side effects or completely different change in price or something like that.

Yes, we would tend to agree with that. And I would make this point, too, from an investment perspective. We, as investors, you've seen over the last few decades, a good amount of innovation and a lot of progress on the LDL space and the LDL side of this equation. On the TG side, you really haven't. And now to have two options one that's approved in SHTG and hopefully, pending a successful review and approval for plozasiran, two new options and really dramatic treatment effect that just didn't exist with current standard of care. We view this as a growth opportunity for both companies, frankly, and a really untapped commercial market.

As Andy mentioned, we think there's 3.5 million patients alone in the U.S., not to mention all of the rest of world patients that just don't have access to effective therapy. And now we think that changes over the coming years. And so we think there is room for pharmaceutical innovation in this space.

[indiscernible]

That's right. Right. And patients are the beneficiaries and the physicians like Dr. Watts and Dr. Nordestgaard that treat them. So again, thank you, everybody. We are, again, thrilled with these data, and we appreciate your interest. And stay tuned for publication. And again, as I mentioned earlier, stay tuned for initial first-in-man data for the dimer program next month. So thank you.

Welcome to the Arrowhead Pharmaceuticals Conference Call. [Operator Instructions]

I will now hand the conference over to Vincent Anzalone, Senior Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.

Thank you. And good afternoon, everyone. Thank you for joining us today to discuss Arrowhead's results for its fiscal 2026 Third Quarter ended June 30, 2026. With us today from management are President and CEO, Dr. Chris Anzalone, who will provide an overview; Andy Davis, Senior Vice President and Head of the Global Cardiometabolic franchise, who will provide an update on commercialization activities. Dr. James Hamilton, Chief Medical Officer and Head of R&D, who will discuss our development programs; and Dan Apel, Chief Financial Officer, who will give a review of the financials.

Following management's prepared remarks, we will open the call to questions. Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the medium Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact are forward-looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statements. For further details concerning these risks and uncertainties, please refer to our SEC filings, including our most recent annual report on Form 10-K and our quarterly reports on Form 10-Q.

I'd now like to turn the call over to Chris.

Good afternoon, everyone, and thank you for joining us today. Arrowhead is now on the strongest footing in its history. Two weeks ago, we reported positive top line Phase III results from the global SHASTA-3 and CAFTA 4 studies in patients with severe aggregates anemia or SHTG -- and we expect additional results to be presented later this month at the European Society of Cardiology topics. These data made clear to us that redempalo is needed therapy for SHTG patients. To that end, we announced today that we have acquired a priority review voucher, which can accelerate the regulatory review process in the United States from 10 months to 6 months, potentially bringing this important medicine to patients as quickly as possible. To me, this is an expression of the air led values, put create the best medicines and be creative and aggressive to rapidly get them to patients who need them.

Let's talk about the SHASTA-3 and 4 top line results. Both studies met their primary endpoint and every prespecified secondary indolent, a clean sweep across 2 pivotal trials. Median triglyceride reductions from baseline were 79% and 81% in SHASTA-3 and SHASTA-4, respectively. These results were deep, durable and remarkably consistent across those studies. Just as encouraging safety and tolerability remain favorable and consistent with everything we've seen in prior studies. We observed no new safety signals, no clinically meaningful differences in routine laboratory measures no clinically meaningful adverse changes in liver enzymes, no average sensitivity cases and no thrombocytopenia signal. In a prespecified MRI PDFF subgroup, there was no statistically significant difference in mean liver fat content between plozasteran and placebo.

The acute pancreatitis findings are, in our view, the standout results. Across the broad SHTG population, patients with trevosaride above 50 milligrams per deciliter with or without history of pancreatitis. Cumulative acute pancreatized events were reduced by 78% versus placebo. And in the Hyster group, patients with traverses above 880 milligrams per deciliter and a history of acute pancreatitis, we saw a 100% reduction in events versus the Detailed results are expected to be presented at a HOT LINE Late Breaker at the European Society of Cardiology Congress on August 30, followed by an Arrowhead webcast on August 31. We intend to submit an sNDA to the FDA before the end of 2026, followed by additional global funds.

If approved, SHTG would represent a substantially larger commercial opportunity than and it would let us utilize the infrastructure we're building today for a much broader patient population. We believe the SHASTA results materially derisk our most important near-term label expansion opportunity and further strengthen the foundation of our Cardioband franchise. As we consider how we could fit into SHTG therapeutic paradigms, we think redemploin 3 ways, safe, simple and strong. Safe because of the impressive tolerability we saw in the PALISADE Phase III and resulting clean label FCS PAUSE combined with what we saw in SHASTA-3 and 4 across multiple measures, including quiet liver enzymes, no hypersensitivity and no increase in liver debt.

Simple, because of quarterly dosing, no anticipated need for liver enzyme monitoring, and a 25-milligram dose for all patients rather than having to titrate up. And strong because of the unprecedented reductions in triglyceride levels because of the unprecedented reductions in triglyceride levels from baseline across the multiple days. We see this as a clearly compelling value proposition for patients, health care providers and payers. Therefore, in the speed of which we can bring pravastatin to the broader SHTG population is critical. The possibility of shaving 4 months off the approval process through the primary or the voucher we acquired is important. We have a saying at Arrowhead that has even etched in the floor of 1 of our facilities. It is that every day matters. This is a driving principle for us from discovery to early development to late-stage clinical to regulatory interactions and ultimately to the last mile, getting important medicines to the patients who need them.

Turning to execution of this last mile. Our U.S. or Debo launch for SCS continued to build real momentum during the quarter. We've seen greater than doubling of prescriptions quarter-on-quarter. Andy will talk through our progress in a moment, including prescription and market access progress and I think you'll come away as encouraged as we are. This launch in FCS has given us valuable experience and a scalable foundation to build on. Physicians are identifying previously untreated FCS patients prescribing activities broad, and our team is building the capabilities we'll need for a much larger potential SHTG launch. We also continue to expand with REDEMPLO reach outside the United States. In May, Australia's Therapeutic Goods Administration approved REDEMPLO as the first and 1 mesine approved for FCS in Australia, including genetically confirmed and clinically diagnosed adults. In June, the European Commission formally granted marketing authorization making REDEMPLO the first and only oligo-based medicine authorized by the DC for adults with FDS diagnosed through either clinical criteria or genetic testing.

Together with our approvals in the United States, Canada, China and Australia, the EU authorization gives REDEMPLO an improved footprint across 5 geographies and important achievements, we are very proud. We're now working through country-specific reimbursement and launch processes while Sanofi leads commercialization in greater time. All of the commercial infrastructure we are building is intended not only to hopefully bring pozasiran to FTG patients but also to serve as the basis of our broader card method franchise, which we expect to include togasiran, aero dimer PA, obesity treatments and other candidates you will hear more about in coming quarters. We're building a large number of potential medicines that could use the same commercial channels, hopefully providing us with substantial scalability and cost-effective growth. We view pozasteran as providing us with a strong value foundation. Our intention is to build on that aggressively, and we have made good progress recently toward that end.

At EASL, we presented interim Phase I/IIa data for ARO-IN-HBE in obesity and MASH and the results were compelling. AROI and HBE achieved dose-dependent active and reductions with a mean maximum reduction over 85% after a single 400-milligram dose with effects persisting beyond 3 months. In a small subgroup of obesity and elevated baseline liver fat receiving at least 200 milligrams as monotherapy. The placebo-adjusted post-dose reduction in liver fat was 44%. The program has been generally well tolerated, and we're now engaging regulators on potential Phase II signs and endpoints. We continue to make progress in the ARO ALK 7 Phase I/II program and expect to release more data from that study in the fourth quarter. Further, we expect to file a CTA for a new obesity candidate against an undisclosed target by the end of this year. Our June cardiometabolic R&D lemon are highlighted with a sodaasiran and Aerodyne PA -- eastern used Phase III study in HL patients is fully enrolled, and we expect to have data in Q3 2027 and hopefully file an NDA by the end of 2027.

Aero do PA designed since both APOC3 and PCSK9 and therefore, reduced both LDL-cholesterol and travisirax. We believe this could be a uniquely powerful therapy to roughly 20 million people in the United States with both elevated LDL and triglycerides. We expect to release early data from our Phase I study in September. During the quarter, we also presented our subcutaneous CNS delivery work around Aero map T at ties. This is an important piece of our pipeline, and we expect to release early data from our Phase I study in September. This is a potentially exciting data set not only because of the potential of AeroMap-T against Alzheimer's disease and other trials, but also because we think it could provide the first clinical proof of concept so we are able to address brain targets with RNAi using a simple subcutaneously administered conjugate.

Our partnership strategy remains a key part of our model and value position. In May, we announced an exclusive worldwide license agreement with Medical for ARO-PNPLA3, a program for a genetically defined NASH plotters. Phase I data showed liver fat reductions of up to 46% after a single dose in homozygous carriers of the PNPLA3 I148M variant with rapid onset durability through at least 24 weeks and no clinically meaningful adverse events observed. Under the agreement, Arrowhead received a $25 million upfront payment and is eligible for up to $975 million in development, regulatory and sales milestones and tiered royalties to the mid-teens. We believe that Arrowhead is something truly unique in biotech today.

We have an approved product and positive pivotal data that we believe supports a potentially much larger indication that we think could drive peak sales in the $3 billion to $4 billion per year range. We have commercial infrastructure that is effective, growing and capable of being the basis for multiple additional products. We have a set of platforms that enable us to address liver, adipose, muscle, lung and CNS targets, and we believe virtually everything we have introduced to the clinic has translated for animal models to humans.

By the end of this year, we expect to have 23 individual drug candidates in clinical trials, 11 wholly owned, 12 partners, and we have a high degree of confidence that the overwhelming majority of these could eventually be approved products. We have the potential for substantial future partner income for our milestones and royalties, and we have the financial resources to keep this engine running and growing. So as you look to the patients we can help and the value we can create, of course, look to easy, but also look to the engine we have built and the dozens of new medicines we can bring to patients.

With that overview, I'd now like to turn the call over to Andy Davis. Andy?

Thank you, Chris, and good afternoon, everyone. It has now been approximately 8.5 months since the FDA approval of REDEMPLO last November, and we continue to be very pleased with the progress of the launch. Today, I'd like to first walk through where we stand with our FCS launch. First, prescription and patient dynamics, second payer coverage; third, pricing and competitive positioning, fourth commercial infrastructure and fifth international expansion. And then finally turn to some reflections on our recent SHTG clinical trial results.

Let's start with prescription and patient dynamics. REDEMPLO prescription volume has more than doubled over the course of the fiscal third quarter and that momentum has continued into the current quarter. We have supported more than 400 unique prescribers of REDEMPLO, with the specialty mix continuing to be led by preventive cardiology and endocrinology consistent with prior quarters and our expectations at launch. Patient origination remained steady from prior communications across new to therapy versus switch patients and the volume of physicians writing prescriptions and patients receiving REDEMPLO for SCS continues to exceed our internal targets.

In recent market tracking studies, health care professional respondents indicate steadily increasing awareness and depth of product knowledge, with consistently high marks for REDEMPLO both in absolute terms and relative to competition.

Turning now to payer coverage developments. We continue to see strong momentum in the publication of payer policies and overall coverage across payer segments. REDEMPLO now has favorable policies in place for the most significant payers and overall coverage is progressing at a fast trajectory for the brand. We expect the remaining coverage gap to continue closing over the coming months. Our market access team remains focused on ensuring both genetically confirmed and clinically diagnosed FCS patients have access to REDEMPLO and nearly all published payer policies reflect the ability for physicians to diagnose FCS patients using clinical criteria alone.

Next, pricing and competitive positioning. As a reminder, REDEMPLO U.S. WAC is USD 45,000 per patient per year under our 1 REDEMPLO unified pricing model, and we believe the value of REDEMPLO is supported by its highly differentiated efficacy safety profile and dosing convenience. We've said consistently that we believe REDEMPLO offers physicians and patients a best-in-class option, and we remain confident that both the clinical data and the commercial model we've built position us well in FCS as we head towards the potential launch in SHTG. Ultimately, we believe physicians and patients should have the freedom to choose the therapy that best fits a given patient's clinical profile and we'll continue to let the product profile of REDEMPLO and FCS make our case.

On our commercial infrastructure, our field organization continues to scale in a deliberate sequenced way size for both the current FCS opportunity and the future SHTG opportunity as it unfolds. Our commercial team's tenure and productivity continue to build, and we're seeing that reflected in the prescription and payer metrics I just walked through. Importantly, if the launch timing for SHTG is accelerated as we expect, we will be ready. Just this past week, in fact, we onboarded the next wave of field personnel. This team will be in the field this month educating stakeholders on SCS and REDEMPLO. Lastly, a word about international expansion. REDEMPLO now approved for FCS in the United States, Canada, China, Australia and the European Union. On the EU approval specifically, REDEMPLO label uniquely covers both genetically confirmed and clinically diagnosed FCS patients. That is to say it's the only therapy in Europe with clinical FCS on label.

We view this as a meaningful differentiator given that a substantial share of real-world FCS patients are diagnosed clinically rather than genetically. We expect reimbursement will proceed on a country-by-country basis over approximately the next 12 months, beginning with Germany in the coming weeks.

I'll wrap up my remarks with some reflections on what's ahead for pluzasterin and SHTG. As Chris highlighted, we recently announced top line results from the Phase III SHASTA-3 and SHASTA-4 studies of pivastlarinsevere hypertradyceridemia, and we believe these are best-in-class results. Both studies met their primary endpoint with median triglyceride reductions of 79% and 81% for baseline at month 12 in SHASTA-3 and SHASTA-4, respectively, compared to approximately 27% for placebo. Just as importantly, in a preplanned pooled analysis, pluvasterone achieved a statistically significant reduction in acute pancreatitis events versus placebo across the broad SHTG population study a 78% reduction in cumulative AP events.

And in the subset of patients with the very midst risk, those with triglycerides above 880 milligrams per deciliter in a prior history of pancreatitis we saw a 100% reduction in APNs versus placebo. The safety and tolerability profile remained consistent with what we've seen across the plizasterin program to date with no new safety signals no clinically meaningful liver findings into hypersensitivity or thrombocytopenia signal. We see this data set as a powerful validation of plozasterine's profile across the full spectrum of HTG and it gives us continued confidence in our planned supplemental NDA submission, which remains on track for before the end of this year.

With that, I'll turn the call over to Tim.

I'd like to share our plans for R&D milestones and data readouts throughout the rest of the year. But first, let's review the R&D team's accomplishments over the last quarter and beyond. We made large strides in advancing our cardiometabolic programs. specifically the Arrowhead team lot databases and analyze data for MIRAI, SHASTA-3 and SHASTA-4 are ahead of schedule, culminating in the release of top line SHASTA-3 and SHASTA-4 data at the end of last month. As already mentioned, plus aspirant achieved deep and durable reductions in triglycerides translating into statistically significant reduction in acute pancreatitis events. -- lozasiran also demonstrated a favorable safety profile with no statistically significant difference in liver fat in the treatment group versus placebo. We remain excited about sharing detailed results, which are planned for presentation at the upcoming European Society of Cardiology Meeting later this month.

The MIR 3 trial achieved its intended purpose as a study designed to build the plazaseran safety database. We plan on presenting data from this study at a future medical conference. Additionally, during the quarter, plazastiran received Australian and European Commission approval as an adjunct to diet in FCS patients. Switching gears to zodasiran in the development for the treatment of homozygous familial hypercholesterolemia or HoFH. We completed enrollment of the Phase III study in mid-July. Importantly, the study was designed to enroll 60 HoFH patients. However, due to strong demand, we ended up enrolling 70 patients, all with genetically confirmed or clinically defined HoFH. This is a 1-year study, so we expect study completion mid-2027 with data in the second half of '27. Also in cardiomembolic, the AeRODimer-PA Phase I/IIa study in patients with mixed hypolipidemia is nearing full enrollment, and we plan to share top line data in September.

Elsewhere in our pipeline, we continue to make progress with both the Arrow and Hive and the ARO AP7 programs. As Chris already highlighted, we presented data from the ARO INVIDI Phase I study, demonstrating a 44% reduction in liver fat in patients with apexteatosis baseline -- as a reminder, liver fat reductions of better than 30% are generally thought to translate into histologic and potentially clinical benefit. Narromine Phase IIb clinical trial protocol has been submitted to regulators. The trial is designed to evaluate the effects of various doses of aronia on liver fat liver histology, body weight and body composition in obese patients with MASH. The study is intended to evaluate diabetic and nondiabetic patients as well as those on and not on stable increasing therapy. As the study is under regulatory review, we plan on sharing trial details once agreed upon with regulators.

We intend to provide an obesity data update primarily focused on ALK 7 towards the end of this year. Moving on to CNS. We've long held the belief that the CNS represents the next frontier for siRNA therapeutics with a large number of gene targets amenable to a gene silencing approach. Historically, the field has been severely limited by the requirement of intrathecal administration. This is a limitation Arrowhead hopes to remove with pioneering technology designed to deliver siRNA therapeutics across the blood brain barrier. Aerie Matt is Arrowhead's first molecule based on this delivery platform. Matt gene encodes for the tau protein, an abnormal tale accumulation is widely believed to be a critical component of the pathologic cascade leading to Alzheimer's disease.

Additionally, other forms of abnormal tower accumulation are known indirectly caused Mataria frontotemporal dementia as well as progressive supranuclear policy. A Phase I clinical trial of Aero MAPT in healthy volunteers is reaching full enrollment in the second phase of this study in Alzheimer's patients is actively enrolling. As Chris mentioned, we are targeting this September for top line data release from the healthy volunteers. This will be a very important data readout as it could pave the way for later-stage talopathy clinical trials additionally, achieving successful Net TG silencing will validate the platform for use in numerous additional CNS programs in our preclinical pipeline, which includes our partnered programs.

I will now turn the call over to Daniel Apel.

Thank you, James, and good afternoon, everyone. As we reported today, net loss for the quarter ended June 30, 2026, was $194.3 million, or a loss of $1.36 per share based on 143.4 million fully diluted weighted average shares outstanding. This compares to a net loss of $175.2 million or loss of $1.26 per share for the prior year quarter ended June 30, 2025, based on 139 million fully diluted weighted average shares outstanding in that quarter.

Revenue for the quarter totaled approximately $75 million compared to $28 million in the prior year quarter. Revenue was driven by our license and collaboration agreements with Sarepta, Medico, Novartis and Sanofi together with commercial sales of REDEMPLO. Of the total, approximately $26 million related to the Sarepta collaboration, mainly from ongoing recognition of initial consideration under that agreement as well as reimbursement of certain clinical and manufacturing expenses. With the Novartis collaboration, we recognized approximately $20 million in the quarter bringing fiscal year-to-date revenue recognition to approximately $75 million. As of June 30 of the initial $200 million of cash received upfront, approximately $125 million of consideration remains in deferred revenue and will be recognized over time as we fulfill our preclinical research and development obligations.

We also recognized the $425 million upfront payment from Medical following completion of the license and technology transfer for ARO PNPLA3. As previously announced, Arrowhead remains eligible to receive up to $975 million in development, regulatory and sales milestones as well as tiered royalties on future commercial sales ranging from high single digits to the mid-teens.

Finally, we recognized approximately $1.2 million for transitional services and commercial FCS supply to Sanofi under our license agreement for Greater China. As previously mentioned, we are not intending to headline specific REDEMPLO product sale members until they become a meaningful driver to our financials. That said, commercial revenue can be derived from our disclosures as a difference between total revenue and collaboration revenue and represented approximately $2.4 million for the quarter. This is more than double the approximately $1 million recorded in fiscal quarter 2 and we have been very encouraged by the continued progress we are seeing in launch.

Turning now to expenses. Total operating expenses for the quarter were approximately $245 million compared to $193 million in the prior year quarter. The $52 million year-over-year increase was driven by approximately $36 million of higher R&D expense and $16 million of higher SG&A expense. R&D expenses of approximately $198 million, increase year-over-year was primarily attributed to a $32 million increase in candidate costs, reflecting continued progression of our pipeline through clinical development including the Phase III registrational program for plazastra and SHTG as well as increased manufacturing and clinical supply activity. In line with our forecast, this also contributed to the pickup in expenses when compared to fiscal quarter 2. Salaries were also higher, driven by increased head count to support manufacturing operations and a broader clinical pipeline.

As James discussed, SHASTA-3 and SHASTA-4 I have now read out with positive top line results. Accordingly, we expect costs associated with active execution of those studies to begin to moderate down over time beginning in fiscal 2027. At the same time, we will continue to invest in regulatory activities commercial supply readiness or potential SCG launch and advancement of our broader pipeline, the quarterly R&D expense will continue to be highly influenced by program timing of clinical activity.

SG&A expense was approximately $47 million in the quarter compared to $31 million in the prior year quarter. The increase was primarily driven by ongoing investments supporting the commercialization of REDEMPLO including commercial headcount, marketing and launch support and other outside services. Given the opportunities we are seeing in FCS, we have expanded and are continuing to expand our commercial footprint and our capabilities where appropriate. We're building these capabilities to support the current FCS launch, where we've designed them to scale, supporting potential future indications for plain and ultimately so outrun HOFH.

Turning to the balance sheet. Cash and investments on hand totaled approximately $1.6 billion as of June 30, 2026. Common shares outstanding at quarter end were 141.1 million. As we have disclosed, we have entered into an asset purchase agreement for an issued FDA priority review voucher which we plan to use with our upcoming sNDA submission for plozasterin in SHTG. Under the terms of the APA, we will pay the current total of $215 million at closing, which we expect to occur in our fiscal fourth quarter, following HSR clearance. Coding to our projections, should we gain approval in SCG, the increase in present value of REDEMPLO simply as a result of shifting our launch aspirations and uptake curve forward by 4 months provides a greater than 3x return on the ERP investment.

Further, it is easy to layer on top of that incremental value that we might expect to achieve commercially should we be able to shorten our competitors first mover advantage. As a concluding remark, we believe that our strong balance sheet provides significant financial flexibility to support ongoing clinical development, current and future commercialization activities and our long-term strategic priorities.

With that brief overview, I will now turn the call back to Chris.

Thanks, Dan. We've made so much progress during the first half of the year in the second half in 2026 is equally backed to a potentially important and value-creating events. First, we want to move as quickly as possible to get our NDA submitted for pozasteran supported by the strong clinical data from the SHASTA-3 and SHASTA-4 studies. The priority review voucher we acquired it could help us get this important new medicine to patients with SHTG as rapidly as possible. Physicians and patients are eagerly anticipating this medicine, so we are working hard to make it happen. Beyond bladestertan, we have some important data readouts and events planned before the end of the year that could represent important derisking and potential value-creating events.

These readouts include the following: one, the first clinical readout of Aerodyne PA, the first dual functional siRNA can in targeting both PCSK9 and APOC3 for LDL and TG lowering is expected in September. Two, the first clinical readout for ARO MAPT being developed as a potential treatment for tauopathies, including Alzheimer's disease, representing our first program using the subcutaneously administered CNS delivery platform designed across the blood-brain barrier after systemic delivery. This is expected in September. And three, additional ARLIN-HBE and AROA7 data releases are planned in the fourth quarter for this novel non-inversion strategy, which has quite encouraging early data in obesity and MASH.

With that, thank you for joining us today. And I would now like to open the call to your questions. Operator?

[Operator Instructions] Our first question comes from Maurice Raycroft from Jefferies.

Congrats on the progress and on the SHASTA data, -- with a question on just the sNDA, getting that submitted by year-end can you book in what that time line could look like and what the gating factors are for getting that in? And separately, can you talk about expectations for the ESC late-breaker data -- there's been some debate on median versus mean TG reduction magnitude. And even though there are no static differences on safety, were there any imbalances in liver fat, ALT elevations or glycemic parameters you want to comment on.

Yes. Sure. Mary, this is James. I'll answer the second question. The ESC data, you'll have to wait and see at ESC that we really are under embargo until the conference, so I can't discuss any details around the study. In terms of rate limiters for the sNDA we do plan to have a pre-sNDA meeting with FDA. And then subsequent to our discussions with the agency would file the submission. So for the time being for our team, it's really all about generating sNDA modules and study records and whatnot and finalizing the data that we need for the filing by the end of the year.

Our next question comes from Mike Ulz from Morgan Stanley.

Congratulations on all the progress as well. Maybe just 1 on Aero map T. Just if you can remind us what top line data you might share with us in September and what level of knockdown are you looking for? And has that sort of evolved at all now that we've seen some of the Biogen data.

Yes, sure. I can take that 1 also. So this will only be healthy volunteer data. We'll be discussing primarily safety and then total knockdown. There's not a lot of other biomarkers that we can measure in the healthies. So it's just safety and pharmacodynamic dose range finding study in the healthies. And then sorry, what was the other part of the question?

So I think that we still we're still aiming for probably that 50% to 60% knockdown. I mean, that level of knockdown seemed to achieve some level of clinical improvements in the Celia study. So I think we've said that all along, and we're kind of sticking with that benchmark of 50% to 60% knockdown.

Our next question comes from Brian Cheng from JPMorgan.

Let us set our congrats into the -- on the caster data. Early in the call, you talked about the sequencing scale up of your sales force how big of a sales force do you envision that you'll need to reach? And how does that sequence look over the course of the next several months heading into the label expansion decision?

Thanks, Brian. This is Andy. Good question. While I won't go into the details of the size of our field force for STG, I would tell you that we'll be moving from effectively addressing over 5,000 HCP targets to a world who will be addressing over 20,000 HCP targets across both the specialists that I've mentioned previously and also potentially those primary care physicians who act like specialists. So we would anticipate the final onboarding of the optimization of our field force to happen before the end of the year as we prepare for a potential accelerated launch in SHTG in the second quarter of next year.

Our next question comes from Luca Issi from RBC.

Congrats on the progress. Maybe a quick 1 for James again. You're not commenting on whether there is there's not a trend in terms of like increasing liver fat. We can write given that the data is still in Barco and ESC. But maybe can you remind us what proportion of our patients in SHASTA-3 for actually received an MRI in baseline in year 1 -- just trying to understand what's the sample size here, how meaningful that analysis will be.

So that will be much appreciated. And then maybe super quickly, now that you have SHASTA-3 and SHASTA-4-how should be thinking about shaft will you still continue that trial? Or maybe will you wind that down? Any thoughts there? I much appreciate it.

Initial question, like I said before, we're under embargo. I can't really give any details around the SHASTA-3 or SHASTA-4 study, but we'll present all of it at ESC or Shustfy, we don't have any plans to terminate that study right now. The plan would be to continue that and maybe get a better idea of what our label is going to look like before we make any decisions to stop the study. So for the time being, it's kind of status quo. We're continuing the role at study and continuing to run the study without any changes.

Our next question comes from Jason Gerberry from Bank of America.

This is Dina on for Jason. Congrats on the progress this quarter. Just the first 1 is on REDEMPLO and SHTG. Just curious if you guys have a view on which TD responder analysis, do you view as maybe more important for establishing that REDEMPLO is very strong at TG lowering -- is it that below that 500 threshold or below that 150?

And then just a second one, if I could squeeze it in while your priority review voucher allow you to get Part D coverage for REDEMPLO for most of 2027? Or is it just the second half of 2027.

I'll take the first question around responder analysis. I mean, again, you're going to have to wait until ESC to see the actual data on the responder analysis, but I mean for SHTG 500 meg per deciliter is that the threshold and it's thought to be below that, you should reduce the risk for acute pancreatitis, which is really where we're focused with the drug right now.

Yes. I think both 150 and 500 million are important. It's our goal to get as many below 500 as possible. But certainly, if we can normalize a large percentage of these patients, that's a very attractive tool for physicians. And on the -- sorry, what was the question on the priority voucher?

If your PRV will allow you to get Part D coverage for most of 2027? Or is it just the second half of the year like more towards the end of the year?

Yes. So Gena, as we normally would will be pursuing both payer policies and coverage for SHTG as rapidly as possible. So our market access team as soon as the data is published in the coming months or so, we'll be interacting with payers to inform them of the data and prepare for eventual policy development and coverage throughout 2027..

Our next question comes from Joseph Thome from Cowen.

For the HCG market, -- how would you see the difference in prescribing between the U.S. and European markets or any changes in practice guidelines between the 2 that we should be thinking about -- and maybe of that $3 billion to $4 billion range that you indicated for plozastaran, how much of that is U.S.-based versus international markets?

Yes, I'll take the question. The second question that the majority of that is in the United States. We overlap the majority of that. Do you want to...

Yes, this is Andy. As far as European market dynamics versus U.S. market dynamics related to triglycerides and acute pancreatitis -- both are extremely important. These markets from a payer perspective are very outcomes-based. So the fact that we demonstrated a statistically significant reduction in the pooled analysis for SHASTA-3 and SHASTA-4 is incredibly important to demonstrating value in the European markets. But those health care practitioners in Europe recognize that AP and ongoing AP is a function of elevated triglycerides and whether or not you had a prior history of AP and -- and so that's the same as the health care providers in the United States as well.

But we'll be the 65th company to tell you that given the uncertainty around MFN, is very difficult for us to at this point to know how these are going to be pursued in ex U.S. markets and what kind of revenue we're going to see from outside the market.

Our next question comes from Jane Codes from Stifel.

And congrats on all the progress. Maybe 1 on rigs and just specifically as it relates to sort of your expectations around the commercial opportunity. With your data out there now, the Ionis launch is sort of underway. Just wanted to get your latest on kind of how we should be thinking about what the right analogues are here? And maybe more specifically, like how important you think the initial quarters for this class are just sort of validating or reading on to the size of the overall opportunity here?

Yes, happy to take that. This is Andy. I mean, as with any launch, of course, you want to get out of the gates quickly. So we'll be hyper-focused on ensuring that our providers are well educated on the value REDEMPLO in SHTG. And we'll also simultaneously, of course, be working with payers to get policies published and coverage in place in order to accelerate the ramp of REDEMPLO and SHTG. As you would know, there is a high degree of overlap between those prescribers who are writing for familial chylomicronemia syndrome and those who will also write for -- these are, of course, those who have an interest in lipidology, -- there are about 1,500 of those individuals in the United States across specialties. So we think the ramp that we're seeing in bodes well for the ramp, we would expect to see in SHTG also.

And I'll give you a qualitative answer also. Look, we think that ECD is a very large market opportunity. There's an awful lot of patients who have trivisyrides that we really need to help get under control. We're committed to that. Our KOLs are convinced at that. However, this is going to be a relatively slow range because this is a brand-new market. We are in the education business. And so it's going to take a bit of time for us to get the word out because look, the world is not used to looking at TG closely because there has been, in part, at least, because there have been no good ways to really reduce drives now. And so -- but this is all a good thing for patients. It's just going to take a bit of time to educate those patients and educate physicians.

Our next question comes from Madison lady from B. Riley Securities.

Congrats on the progress question here. Maybe how should we think about the doubling of REDEMPLO prescriptions I guess, in terms of weekly run rate. I think 30 per week, maybe was the last disclosure you guys put out. And then relatedly, has the prescription to drug in arm conversion rate kind of hit the steady state for LCS? And if not, kind of just what are the drivers there?

And then secondly, if I can, quickly, for ESC, I know you're under embargo, so just a general question. Do you expect the learnings there are more academic in nature? Or is it something that really kind of facilitates a naive cross-trial comparison and really kind of informs the lingual.

Yes. Madison, this is Andy again. Thanks for your question. Yes, we do see approximately 20 to 30 new prescriptions a week that has been the run rate and consistent with what we have communicated previously. Of course, our teams are very focused on also ensuring that those prescriptions find their way through the funnel, ultimately to shipments to patients -- and so our market access team is working incredibly hard to support our payer and our physicians and offices around compliantly navigating the prior authorization process and appeal process. But as I mentioned, we will have new field personnel in the field educating stakeholders as early as this month. And so I would expect to see also an inflection point both in prescriptions at the top of the funnel, but also in the way those prescriptions filter through the funnel to ultimately those patient shipments.

And on the ESC question, again, I'm just really hesitant to make any additional comments on the data just given the embargo. So you'll see at the end of the month.

Our next question comes from Patrick Tucci from HC Wing right.

This is Luis Patrick. We're thinking about the launch in SHTG will be in the highest risk patients will be segmented to the highest risk patients or more broadly across patients with TGs above 500. And the question is directed at how would this reflect on the commercial build? Will it be a step function or will be an incremental expansion of the existing FCS field force.

Yes. Thanks for your question. This is Andy. Certainly, while we think the top line results support REDEMPLO across the spectrum of SHTG patients. Naturally, we'll be focused on those high-risk SHPG patients out of the gate. These are, of course, those patients who have the highest unmet need in the view of health care professionals and also the highest willingness to pay by payers. And so that will be our initial focus at launch. As far as scaling of the field force, as I mentioned, we did implement effectively a step function increase in the field force that will go into the field this month, and we'll continue to look to optimize our field force as we head towards SHTG.

And let's be clear. I think that our data suggests that it is important to get people's triglycerides down if they have tiger levels above 500 full stop. We had people who had triglycerides below 80 who had pales and pancreatitis. I think that's important. So while we think that, that population at greatest risk is going to be the initial market, there is a broader market to address here that I think is important and the relations that need to be treated -- but again, as I mentioned earlier, this is going to be an education play, and it's just going to take a bit of time to help physicians and patients understand the risk cure.

Our next question comes from Keay from Chardan Capital Markets.

Now that you have your data, how are you thinking about price differential versus Tringolza?

Yes. This is Andy. So I won't go into right details or contracting strategy only to say that you would be aware of the wholesale acquisition cost for REDEMPLO per year. That does differ from our competitor, and we've communicated previously that we believe that premium is justified based on the product attributes of REDEMPLO across efficacy, safety and convenience.

If the question is do we intend to move that price now that we have the data, the answer is no. We believe this is the right price for this drug. We think that there is real reason to price this at a slight premium to our competitor given what we see as a better safety profile a better reduction in triple from baseline, a simpler approach to a quarterly dosing rather than a monthly dosing, a lack of need to -- we believe a lot we need to reach follower enzymes because we just haven't seen those issues and a simple 25-milligram dose for all patients rather than having a titrate.

Our next question comes from Jin Ji from Cantor Fitzgerald.

This is Tonawograsts on the shakes. So for the euro programs, what other CNS targets are you excited about if the Phase I/II for MAP2 positive?

Are you asking what other gene targets are we interested in.

Yes, for knockdown.

Sure. So we have a lot of different targets. We haven't disclosed any of those in terms of wholly owned programs -- we probably won't disclose those until around the time of the CTA filing just given the competitive nature in the siRNA space right now. So stay tuned.

Our next question Edward Tenthoff from Piper Sandler.

I just wanted to read through it a little bit and go back through sort of what the plans are for marketing now that you're approved in U.S., Canada, Australia and Europe. Are you directly marketing in each of those -- and how ROEs and distributors? And how is -- are you going to recognize revenues from each of those geographies and then pay out a distributor fee in SG&A. So on understand the dynamics more.

Thanks for the question, Edward. Good question. This is Andy again. So we are marketing into those countries that you mentioned using commercial partners. So REDEMPLO is not out-licensed nor have we established distributor relationships in those markets. It's effectively Arrowhead in operation with our commercial partners in those markets that you mentioned with the exception of China.

And in terms of revenue recognition.

So in terms of our recognition just fall standard, this is Dan here. all of the standard revenue recognition. So as we complete a sale to customers in those countries, we would recognize revenue. So nothing unique in that regard.

Is it a net revenue? Or is there a fee that's paid in SG&A?

Yes. No, it's -- I mean it's similar to the U.S. So it will be a gross sale -- and then in the gross to net, you have to deduct out sort of distribution costs and the like. But if you're asking about the cost to support that has been offered by our commercial partners there just kind of like a contract marketing contract sales, that would show up in marketing and sales costs.

This concludes the question-and-answer session. I would now like to turn the call back to Chris and Natali only for closing remarks.

Thanks very much for joining us today, and we look forward to speaking with you later in August after ESC and then in September around the radar disclosures as well as the MAP -- have a great summer.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Good morning, everyone, and welcome to Part 1 of Arrowhead Pharmaceuticals' 2026 Summer Series of R&D webinars. [Operator Instructions]

As a reminder, this call is being recorded, and a replay will be made available on the Arrowhead website following the conclusion of the event. I'd now like to turn the call over to Vince Anzalone, Vice President of Finance and Investor Relations at Arrowhead Pharmaceuticals. Please go ahead, Vince.

Thank you, Tara, and thanks, everyone, for joining us today. So this is the first installment of our 2026 summer series of R&D webinars. Today's session will be focused on our cardiometabolic pipeline. Later in the summer, we'll also detail the -- our obesity programs and also our new CNS programs, including our tau program targeting Alzheimer's. So before we start, I just want to make sure you know that we will be making forward-looking statements today. So please refer to all the risk factors in our SEC filings.

Okay, so here's the basic agenda today. I'll give an overview of the cardiometabolic pipeline. James Hamilton, our Head of R&D and Chief Medical Officer, will talk about our technology and the process that we use to discover and develop new drugs. Dr. Jennifer Hellawell, our Head of Clinical Development and Cardiometabolic, will talk about plozasiran and zodasiran, specifically the clinical development programs. James will come back and talk about our first dual functional siRNA, which we call ARO-DIMER-PA, which silences PCSK9 and the APOC3 gene. And then Dr. Steven Nissen from the Cleveland Clinic will talk about the mixed hyperlipidemia market and the treatment landscape for ASCVD.

At the end, we'll also have some time available for Q&A. So before we start, I just want to introduce Dr. Nissen from Cleveland Clinic. He's the Chief Academic Officer for the Heart and Vascular Institute at Cleveland Clinic. He has -- it was very hard to put his bio into one page because he has a long and storied career, and we're very fortunate to have him with us today. He has been involved with or has directed pretty much most, if not all, of the large cardiovascular outcome studies over the last couple of decades. And this is not an overstatement that I think he is insight personified when you're talking about cardiovascular disease. So thank you, Dr. Nissen, for joining us today.

Okay. Quick overview about Arrowhead. So as most of you, I'm sure know, we are -- we're an RNAi therapeutics platform company. We have our own independent products, as well as partnered programs. They're all based on a proprietary platform that we call targeted RNAi molecule or TRiM. We launched our first commercial product last year as Redemplo, which is approved to reduce TGs in patients with familial chylomicronemia syndrome. It's now approved for that indication in the U.S., the EU, Canada, Australia and China. We think that, that product by itself has a multibillion-dollar opportunity across the multiple indications over the coming years. And importantly, we see the potential for multiple independent and partnered launches over the coming years.

Our pipeline already today is extremely broad. We have 20-plus clinical stage programs. Most of those are wholly owned. We also have a good mix of early, mid as well as late-stage programs. So it's a very diverse pipeline. We also don't -- our first approved indication was a very rare disease, but we don't have a slant towards rare disease. We are aiming to treat diseases that are both rare and ultra-high prevalence, which you'll hear about later today when we talk about mixed hyperlipidemia and ASCVD. There's probably 20 million patients with that condition in the U.S. And our pipeline is growing. We aim to have 2 to 3 new clinical programs every year that we generate with our technology. As I mentioned before, everything is built on the targeted RNA molecule or TRiM platform. It's designed for deep and durable gene silencing. And importantly, we think Arrowhead is the clear leader in the field at bringing RNAi therapeutics to diseases outside the liver. And as James will talk about, we can now access 7 different cell types in the body with our technology. And lastly, we have an extremely strong balance sheet, and we are funded now into potentially multiple commercial launches, again both independently and with partners.

And we expect additional nondilutive capital over the coming years to come in from our existing partnerships with Madrigal, Sarepta, Amgen, Takeda, GSK, Novartis and Royalty Pharma. So we are in a very solid and stable position as a company. Okay. So here is a diagram that talks about where we are looking to play with our cardiometabolic pipeline. And so if you think about this diagram on the left side, it represents elevated LDL cholesterol. And the further left you go, the more severely elevated that is. On the right side, it's elevated TGs or triglycerides. And again, the further to the right you go, the more severely elevated they are. For the right side of this diagram is FCS.

So patients with TGs that are in the thousands that are at very high risk of acute pancreatitis. And for those patients, as I mentioned, we have an approved therapy called Redemplo. -- and it's approved to reduce TGs in patients with FCS. As you go a little bit more to the left on this diagram is severe hypertriglyceridemia, so patients with TGs above 500 that are at a heightened risk of acute pancreatitis. And as Jen will talk about later, we have a Phase III program that should be reading out in Q3 to potentially address that population. On the left side, as you go all the way to the left is homozygous familial hypercholesterolemia or people who have LDL cholesterol above 400 that get early onset cardiovascular disease.

And again, that's also very rare. As you go more towards the middle is the intersection of elevated LDL and TGs or the mixed hyperlipidemia population. These are patients who have elevated triglyceride-rich lipoproteins, remnant cholesterol, LDL and TGs. And for that middle part of the population or mixed hyperlipidemia, we have the ARO-DIMER-PA, the PCSK9, APOC3 dimer. And so we're trying to kind of play in all different parts of this LDL/TG spectrum. So here's a diagram of what we hope is -- will happen in the future. And obviously, this is forward-looking.

We have our first launched product in Redemplo. On the bottom left, it was approved for -- to reduce TGs for patients with FCS in 2025. Pending successful clinical data and regulatory review and submission, we hope our next launch independent will be for SHTG with the plozasiran or Redemplo product in 2027. In 2028, we hope to launch zodasiran, again, pending successful clinical development and regulatory review for HoFH, and that is scheduled or hopefully anticipated for 2028. And then beyond that, we have the ASCVD programs and the obesity programs, which we'll talk about later.

And then down the bottom right, we also have a late-stage partnered program with Amgen called Olpasiran, which is in Phase III development for cardiovascular disease associated with elevated apolipoprotein A. Okay, so let me turn it back over to James, and he'll talk about Arrowhead's technology and R&D process.

All right. Thanks, Vince. And just to reiterate, for those who are new to the story, Arrowhead is an siRNA company, and we don't do anything else. Everything is focused on developing siRNA drug molecules. All of our drugs are derived from a platform we call TRiM or targeted RNAi molecule. And so what is TRiM?

The platform is really at its core, an aggregation of rules, algorithms and internal know-how, enabling optimal siRNA sequence selection and molecule design. So our goal is to maximize on-target potency while reducing or totally eliminating any risk of off-target gene silencing. We combine our sequence selection acumen with a library of different targeting ligands and linker chemistries designed to facilitate delivery to various cell types. Importantly, this platform is modular. So once the delivery system has been validated, the process for developing new sequences against new targets using the same delivery platform can be repeated over and over.

This allows for rapid progression from new target ID to first-in-human proof-of-concept. One of the strategic differences between Arrowhead and other siRNA companies is that we decided early on to push the delivery technology outside of the liver. Now Arrowhead is very good at designing so-called GalNAc molecules, and we have many liver-targeted siRNAs, including Redemplo, which has been approved in the U.S. and in Europe for familial chylomicronemia syndrome. However, our clinically tested and increasingly clinically validated extrahepatic delivery technology is broader than the delivery capabilities available to any competing ASO or siRNA company.

This includes, of course, hepatocyte delivery as well as a clinically validated platform for delivering to pulmonary epithelial cells and separate platforms delivering to skeletal muscle, adipocytes and the CNS, all currently in clinical trials. And I'll add that the CNS platform uses subcutaneous delivery rather than an intrathecal route of administration used by many of our competitors. Importantly, we continue to innovate. We've been working on preclinical platforms for delivering siRNA to the eye, both the back of the eye as well as the anterior chamber of the eye, also to cardiomyocytes as well as several other cell types.

This breadth of platform capabilities supports one of the most productive R&D discovery engines in biopharma. The evidence for this is our expansive pipeline, which represents 20 novel molecules in various stages of clinical development and is diversified across stages of the development, disease indication as well as a mix of partnered versus wholly owned assets. Importantly, this is our pipeline since 2016, when we had zero drugs in the clinic. So we've been averaging a little better than two INDs or CTAs for new molecular entities per year over the last 10 years. And again, all of our programs are homegrown. We've not in-licensed any molecules from academia or other companies. These have all been derived from the TRiM platform.

Just to provide some additional details on discovery platform productivity, we average initiation of about 10 new discovery programs per year, which leads to about 4 new clinical lead nominations annually. And naturally, there's some attrition, but we aim for an average 2 to 3 new INDs or CTAs per year, and our goal is to go from new target ID to a CTA in 12 months or less. Now as I've described, Arrowhead has done extensive delivery platform development work. But one of our biggest challenges is maintaining a steady stream of good new targets where we can apply the TRiM platform to develop siRNAs against those targets. Historically, new targets may have originated from KOL panel discussions, literature searches or competitive intelligence. However, recently, we've increased our investment in using AI capabilities to analyze the large amount of genetic data generated by overlying target cell expression patterns with a variety of human genetic databases to identify new targets ideal for siRNA therapeutics. This is a data dense approach, which has been successfully amplified using various AI engines to facilitate new target ID qualification and assessment.

And while we're relative newcomers to developing internal human genetics discovery capabilities, we anticipate increased investment in this area to ensure a steady supply of new gene targets. I'd now like to shift gears and hand things over to Dr. Jen Hellawell, who will review our late-stage progress and future plans with plozasiran and zodasiran.

Thank you, James.

Hypertriglyceridemia represents a spectrum of disease with severe clinical manifestations and considerable unmet need across that spectrum. Later today, Dr. Nissen will describe the unmet need in patients with moderate hypertriglyceridemia, generally triglycerides in the range of greater than 150 to 200 mg per deciliter, a condition affecting upwards of 10 million people in the U.S. with substantial atherosclerosis burden and overlap with other cardiometabolic risk factors. However, severe hypertriglyceridemia defined as a serum triglyceride level of greater than 500 milligrams per deciliter, affects approximately 1 in 100 persons or over 3 million people in the United States and can have similarly dire clinical consequences, including an increased risk of life-threatening acute pancreatitis. Much like atherosclerosis, risk in these patients with severe hypertriglyceridemia is driven primarily by both higher levels of the causal lipoprotein, in this case, triglycerides and a history of prior clinical events, in this case, acute pancreatitis.

For this reason, patients with the highest triglycerides and prior acute pancreatitis events are often referred to as high-risk severe hypertriglyceridemia. And this subset is thought to represent about one in a million people in the United States. Of course, at the very top of this spectrum is -- or the bottom of the spectrum on the slide here is the most severe and rare form of hypertriglyceridemia known as familial chylomicronemia syndrome. This is a genetically inherited condition, which can be diagnosed through identification of biallelic recessive pathogenic variants or through established clinical criteria. And this condition affects potentially 6,500 to over 10,000 people. It's characterized by triglycerides persistently in the chylomicronemic range, which is usually described as greater than 880 milligrams per deciliter or 10 millimoles.

And these patients have an extremely high risk of acute pancreatitis with many patients with FCS suffering multiple recurrent attacks and a variety of related severe sequelae throughout their lifetimes. Unfortunately, as we know, conventional triglyceride-lowering therapies such as fibrates and omega-3 fatty acids rely primarily on fully functional lipoprotein lipase pathways, which are often dysfunctional in these patients and therefore, often have very modest effects on triglyceride levels. Importantly, until very recently, none have been shown to reduce the risk of acute pancreatitis. -- lipoprotein C3 or APOC3 is a key lipoprotein involved in triglyceride hydrolysis and clearance through both lipoprotein lipase-dependent and independent pathways and has recently emerged as a therapeutic target across the full spectrum of hypertriglyceridemic disorders. The SUMMIT program was built around the therapeutic hypothesis that plozasiran, a silencing RNA targeting APOC3, can facilitate triglyceride clearance through derepression of lipoprotein lipase and increased hepatic uptake of triglyceride-rich lipoprotein remnants. The Phase III PALISADE study demonstrated that plozasiran can effectively decrease circulating triglycerides in FCS and thereby reduce the risk of acute pancreatitis in that population.

As Vince mentioned earlier, these data served as the basis for the approval of plozasiran or Redemplo for the treatment of adults with FCS in the U.S., China, Australia, Canada and the European Union. In addition, prior randomized Phase IIb trials, SHASTA-2 and MUIR, established short-term efficacy and safety of plozasiran in severe hypertriglyceridemia and moderate hypertriglyceridemia. However, up until recently, the long-term durability and safety data in these particular populations have been limited.

A few months ago, we shared data from the 2-year open-label extension of SHASTA-2 and MUIR, evaluating the long-term efficacy, safety and tolerability of plozasiran 25 milligrams dosed quarterly across the mild to severe hypertriglyceridemic populations. A total of 418 patients were enrolled in this 2-year open-label extension with approximately 250 and 170 patients from the MUIR and SHASTA-2 parent studies, respectively. Participants initially received open-label plozasiran administered every 12 or 24 weeks at the assigned dose level of the parent study until a final dose of 25 milligrams quarterly was selected over the remaining 2-year follow-up period.

The primary objective of the study was to assess safety, though, of course, secondary endpoints, including change in fasting triglycerides, APOC3 levels, non-HDL-C and a variety of other lipoproteins were assessed. Baseline characteristics of this open-label extension were similar to those of the respective parent studies. Of note, in considering the generalizability of these findings to the broader severe hypertriglyceridemia population, we can see that in the SHASTA-2 subset of the open-label extension, baseline median triglycerides were between 680 to 730 milligrams per deciliter and roughly 1 in 5 or 20% of patients had a prior history of acute pancreatitis.

Consistent with observations in the parent studies, Plozasiran induced robust, consistent and clinically meaningful reductions in triglycerides throughout up to 2 years of follow-up in the open-label extension. During the open-label extension, median triglycerides continued to fall by 82% and 83% at month 12 and month 24, respectively, while mean triglycerides reduced by approximately 77% and 79% at month 12 and month 24, respective. In terms of the clinical meaning of these effects, the SHASTA-2 subset in the SHASTA-2 subset, about 94% of patients achieved fasting triglycerides less than 500 milligrams per deciliter, which is the well-established risk threshold for increased risk of acute pancreatitis, and about 63% achieved fasting triglycerides less than 150 milligrams per deciliter, which is considered the upper limit of normal. This was at month 12.

Moreover, 96% and 63% of patients maintained these clinical thresholds throughout the entire 24 months of follow-up. In the MUIR subset, plozasiran treatment was associated with median reductions in triglycerides relative to baseline of 67% at both month 12 and month 24 and mean triglyceride reductions of 62% and 63% at month 12 and 24 of the open-label extension. Consistent with these robust and sustained triglyceride reductions, there was a reduction of acute pancreatitis events as well with no acute pancreatitis events occurring in both studies during the open-label extension. As a reminder, in the double-blind period of SHASTA-2 in the parent study, 3 episodes of acute pancreatitis occurred during the randomized period in 2 of 61 patients in the placebo group and 1 episode in 165 patients receiving plozasiran 50 milligrams, translating to an odds ratio of 0.18. -- though considering the small size of the study and short follow-up, the 95% confidence interval did cross 1. In the open-label extension, however, overall, 11 events were sent for adjudication by our abdominal events adjudication committee.

And of these, 0 were positively adjudicated for acute pancreatitis referencing the Atlanta criteria. The extrapolated curve represented above by the dotted line shows the expected results if participants who had been initially signed to placebo had continued receiving placebo in the open-label extension. Finally, plozasiran demonstrated a reassuring long-term safety and tolerability profile consistent with index studies. We saw stable glycemic parameters and no clinically meaningful changes in liver or renal function as well as no new safety signals that had not previously been detected.

In conclusion, in our combined open-label extension of the Phase II SHASTA-2 and MUIR studies, long-term treatment with 25 milligrams quarterly of plozasiran resulted in sustained and clinically meaningful reductions in triglycerides across a broad spectrum of hypertriglyceridemia, including severe and mixed phenotypes through up to 2 years. This provides critical insights into what the longer-term effects of plozasiran will look like in this broader population. The majority of patients in the open label achieved triglyceride levels below clinically relevant thresholds for acute pancreatitis and many achieved levels below what's considered the upper limit of normal with 96% of severe hypertriglyceridemia patients achieving triglycerides less than 500 milligrams per deciliter and 63% of severe hypertriglyceridemia patients achieving levels less than 150 mg per deciliter.

There was a reduction in acute pancreatitis events with no adjudicated acute pancreatitis events occurring in both studies in the open label, which implies that longer-term treatment with plozasiran further reduces the risk of the clinical outcome of interest acute pancreatitis. Importantly, plozasiran demonstrated a consistent long-term safety and tolerability profile, as I previously described. Therefore, with a better understanding of the long-term safety and efficacy of plozasiran in severe hypertriglyceridemia from this open-label extension, we very eagerly await completion of our SHASTA-3 and SHASTA-4 studies. As previously discussed, these 2 pivotal double-blind, placebo-controlled Phase III studies were designed to meet regulatory requirements for substantial evidence of effectiveness to evaluate the efficacy and safety of plozasiran in adults with severe hypertriglyceridemia. After screening, patients with severe hypertriglyceridemia, which was defined as fasting triglycerides greater than 500 milligrams per deciliter and meeting other key eligibility described eligibility criteria described here were randomized to plozasiran 25 milligrams dosed quarterly for 1 year versus placebo to match.

The primary endpoint of both studies is percent change in fasting serum triglyceride levels from baseline to month 12, followed by a number of key secondary endpoints described here on the slide. Of course, we're assessing adjudicated acute pancreatitis events from day 1 to month 12 and frequency and severity of adverse events and serious adverse events over time through month 12. The 2 studies completed enrollment about a year ago at a total of 351 sites across 23 countries. Ultimately, 757 patients were randomized with 446 and 311 in the SHASTA-3 and SHASTA-4 studies, respectively.

Consistent with the known epidemiology of severe hypertriglyceridemia, the mean age at enrollment in these studies was in the early 50s. Roughly 80% of patients were male and predominantly white. About 1/3 of patients were enrolled in North America, less than half in the EU member states and about 1/4 were enrolled in Asia or elsewhere. The enrolled population did indeed have the expected features of metabolic syndrome with a mean BMI around 31, 62% having diabetes at baseline and about 2/3 also having hypertension at baseline.

Given the high burden of these comorbid conditions, it's not surprising to see that, that translated into considerable polypharmacy with almost reporting taking at least 2 medications, 69% being on statins, about 61% on fibrates, though we acknowledge the limitations of those agents in this disease state earlier. And also consistent with our understanding of this disease, there was quite a bit of variability in TG levels or triglyceride levels at baseline with mean triglycerides at screening of 966 and at randomization of 863.

Again, looking at medical history at baseline, there was a high prevalence of metabolic syndrome, but also a high prevalence of prior history of acute pancreatitis with 20% of patients having had at least 1 episode prior to screening and randomization. Having completed enrollment a year ago, we continue to target top line data release for the SHASTA program in the third quarter of this year. This time line should support presentation at a medical congress and publication of the results in the second half of this year. And finally, a supplemental NDA filing by the end of 2026.

Turning now to another cornerstone of our late-stage cardiometabolic pipeline. I'm also pleased to provide some updates on our zodasiran development program. To understand zodasiran in our development program, we need to appreciate the disease state of homozygous familial hypercholesterolemia, which is a rare inherited lipid disorder characterized by extremely elevated LDL cholesterol in the range of 400 to 1,000 milligrams per deciliter.

That's about 10x normal levels. We know that left untreated people with this disease develop atherosclerosis, severe aortic stenosis as teenagers, sometimes even in early childhood and infancy. Homozygous familial hypercholesterolemia is considered an orphan disease with estimated prevalence of about 1 in 300,000 people worldwide. And although the armamentarium of safe and effective therapeutics for HoFH continues to grow, unfortunately, HoFH patients often have suboptimal responses to conventional lipid-lowering therapies due to their dysfunctional LDL receptor pathways. Highlighting this unmet need, a 2023 report from the CASCADE-FH Registry, which is a registry overseen by the Family Heart Foundation and draws from data on over 80 million Americans. Data from this registry revealed that over 3/4 of adults and 44% of children with HoFH in the U.S. already had documented atherosclerosis or ASCVD at the time of clinical ascertainment.

Furthermore, despite treatment with 3, sometimes 6 lipid-lowering therapies concomitantly in specialty clinics around the U.S., just 1/4 and 32% of adults and children reached their LDL-C goals. And shockingly, despite their well-recognized atherosclerosis and ASCVD risk profile, over half of the patients in the HoFH registry were on no lipid-lowering therapies. Unfortunately, many of these same trends were also reported in a recent report from just last month from the global HICC registry, which is the world's largest HoFH registry of almost 1,000 patients from 45 countries.

All these data highlight that not only is there an ongoing need for availability and access to safe and effective therapies for HoFH, but also for treatment regimens to which patients can readily adhere given the considerable polypharmacy. Therapies targeting angiopoietin-like 3, or ANGPTL3, thankfully offer new promise for HoFH patients. ANGPTL3 is a hepatocyte expressed regulator of lipid and lipoprotein metabolism with multiple potential modes of action depicted in the schematic here, including inhibition of lipoprotein lipase, or LPL, and endothelial lipase or EL. Within roughly the past decade, more and more data has emerged to show that ANGPTL3 loss of function genetic variants lead to enhanced LPL and EL activity, thereby resulting in substantial lifelong decreases in circulating LDL-C and other atherogenic lipoproteins driving a decreased lifetime risk of ASCVD.

Importantly, there is no known adverse phenotype associated with this genetic deficiency and the mechanism of ANGPTL3 is independent of the LDL receptor pathway and therefore, highlighting its promise as a therapeutic target in HoFH. The VISTA program was built around the therapeutic hypothesis that zodasiran, a silencing RNA against ANGPTL3 can facilitate both LDL-C and triglyceride reductions through mechanisms orthogonal to those of conventional lipid-lowering therapies. That is through combined derepression of both LPL and endothelial lipase. In this development program, we have observed consistent reductions in ANGPTL3 levels of up to 96%, triglycerides of up to 71% and LDL-C of up to 50%, along with other lipid parameters across a variety of patient populations studied. Zodasiran across these studies has shown a reassuring safety profile with no changes in platelets, modest nonprogressive signals of worsening hyperglycemia and -- no severe signals of hepatic or renal toxicity thus far. GATEWAY was an open-label randomized Phase II study designed to evaluate the efficacy and safety of zodasiran, our liver-targeted RNAi therapeutic in patients with HoFH.

The study was conducted at 7 clinical sites across the world and patients aged 16 years or older with documented HoFH who are receiving stable lipid-lowering therapy and were on stable diet at baseline who had a screening LDL cholesterol of greater than 100 mg per deciliter and triglycerides less than 300 mg per deciliter were randomized in a 1:1 fashion to receive zodasiran 200 milligrams or 300 milligrams on day 1 and month 3. The study ultimately enrolled 18 patients with mean baseline LDL concentrations of 9.8 millimoles, which translates to about 380 mg per deciliter despite being on background lipid-lowering therapy.

At month 6, patients showed substantial dose responsive reductions in fasting LDL-C with means of about negative 36% and negative 40% in the 200 and 300-milligram dose groups, respective. And this was consistent with what we had previously reported in interim results. Following partial washout, all patients opened -- entered into the open-label extension in which Zodasiran showed continued evidence of effect with reductions in fasting LDL-C of about 40% observed for an additional 12 months. There were no drug discontinuations or drug-related SAEs, severe adverse events or deaths. And the overall safety and tolerability of Zodasiran was quite reassuring and consistent with what had been previously noted in other studies.

These promising results inform the design of our ongoing YOSEMITE study, which is a Phase III study to evaluate the efficacy and safety of zodasiran or ARO-ANG3 in both adolescents and adults with HoFH. This study is currently enrolling eligible adult and adolescent patients with HoFH, which can be defined by either genetic confirmation or established clinical criteria. And upon completion of the 12-month double-blind treatment period, patients are offered the opportunity to continue on into an open-label extension.

After screening, eligible patients are randomized 2:1 to zodasiran 200-milligram dosed at day 1 and then quarterly after a loading dose at month 1 versus placebo to match. And the primary endpoint is percent change from baseline to month 12 and fasting LDL-C levels followed by a number of key secondary endpoints, which are designed to assess the effect of zodasiran across a variety of other lipoproteins of interest as well as safety as assessed by incidence and severity of treatment-emergent adverse events. The study is nearing completion at a total of 47 sites across 21 countries worldwide. And ultimately, we are targeting enrollment of 60 patients worldwide. As YOSEMITE completes enrollment, we are simultaneously pleased to report the launch of a broader pediatric program in HoFH, beginning with our SPRUCE study, which is a Phase III single-arm open-label study designed to evaluate the efficacy and safety of zodasiran in adolescents with HoFH.

This study shares many design features with the YOSEMITE study and aims to randomize this first patient later this summer. We believe that successful execution of the study could then pave the way for subsequent pivotal studies in younger age groups. So to recap, while we eagerly await top line data from our SHASTA-3 and 4 programs of plozasiran in severe hypertriglyceridemia, we continue to make strides in our VISTA development program of zodasiran in HoFH. YOSEMITE is expected to complete enrollment any day now and completion of 12 months double-blind -- completion of the 12-month double-blind portion of the study would be expected in summer 2027, which would hopefully support our first new drug application for zodasiran in the second half of 2027. And now I'm pleased to hand it back to Dr. Hamilton to discuss ARO-DIMER-PA.

Thanks, Jen. So another area of successful innovation at Arrowhead has been in the development of siRNA dimer or dual functional technology. This involves the linkage of 2 siRNA sequences each against a different gene target, allowing the targeted silencing of 2 genes with a single molecule. While our most advanced iteration of the dimer technology uses the GalNAc ASGPR targeting delivery to hepatocytes, we are working on dimers for a variety of different extrahepatic cell types. For our first dimer, we wanted to pick 2 targets that made sense medically to combine and that were well validated. And we think that combining siRNAs targeting PCSK9 and APOC3 make a lot of sense as an approach to potentially treat patients with mixed hyperlipidemia with the goal of reducing their overall atherogenic particle burden.

APOC3 is a key regulator of triglyceride metabolism and a validated target for lowering remnant cholesterol. Similarly, PCSK9 is a key regulator of LDL receptor recycling and a validated target for reducing LDL cholesterol. Importantly, in the mixed hyperlipidemia patient population, there should be an additive effect when it comes to reducing circulating atherogenic lipoproteins, which we can assess by tracking changes in total ApoB as well as changes in LDL cholesterol and remnant cholesterol. We've shown some encouraging initial data in monkeys with our APOC3 PCSK9 targeted dimer, where PCSK9 and APOC3 knockdown were achieved with magnitudes comparable to the individual monomer treatments, and these data have been presented previously.

Also previously presented in spontaneously dyslipidemic monkeys, reduction in PCSK9 and APOC3 translated as expected into reductions in non-HDL cholesterol, LDL cholesterol and triglycerides of approximately 50%. The dimer program has progressed into Phase I. This is a single and multiple escalating dose study in patients with mixed hyperlipidemia. There is no healthy volunteer component to the study. All cohorts require participants to have baseline triglycerides of 150 to 499 milligrams per deciliter as well as either non-HDL greater than 100 or LDL greater than 70 milligrams per deciliter at baseline.

In terms of progress, we should have single escalating dose cohorts fully enrolled by mid- to late summer and full study enrollment completed by the end of the third quarter. And we still anticipate sharing some top line data sometime in the third quarter. I'll now turn things over to Dr. Steven Nissen from the Cleveland Clinic, who will provide more details on the mixed hyperlipidemia patient population. Steve?

Thank you very much, and really appreciate the opportunity to join you and discuss this, I think, very innovative approach to targeting lipid abnormalities with a single molecule. So let me talk about mixed hyperlipidemia, but first introduce myself. I'm the Chief Academic Officer, of the Heart, Vascular & Thoracic Institute at Cleveland Clinic. I'm a preventive cardiologist and have been involved in clinical trials for a number of years. What is mixed hyperlipidemia? Well, it's really pretty simple. It's simultaneous elevation of LDL cholesterol and triglycerides often accompanied by reduced HDL cholesterol. It's distinct from isolated hypercholesterolemia or isolated hypertriglyceridemia it requires both, and importantly, the clinical hallmark is an increased number of circulating ApoB containing particles, atherogenic particles that are involved with both of these abnormalities. The Venn diagram shows you that there's a group of people that have elevated LDL cholesterol, a group of people that have elevated triglycerides and quite a substantial overlap group that have both abnormalities in daily practice.

Now we talk about the atherogenic lipid triad, and that's triglyceride-rich remnants that's accompanied by small dense LDL. That's a more atherogenic form of LDL cholesterol and low HDL, which also appears to amplify risk. There are common drivers, including insulin resistance, metabolic syndrome, hepatic VLDL overproduction, but very importantly highlighted here is impaired lipoprotein lipase clearance, which you've heard from Jen Hellawell is something being targeted by plozasiran and zodasiran. And that leads to the atherogenic lipid triad.

Now how common is this? Well, if you take hypercholesterolemia, -- total cholesterol greater than 240 and triglycerides greater than 200, we're talking about in excess of 10 million U.S. adults that have each of those conditions with, again, substantial overlap, So there was a study done by NHANES. This is a very large study being done by the federal government in patients with lipid disorders. And what you see is that it's common amongst all groups, but highest in Mexican Americans, a little bit less likely in black. And you can see in gold, hypercholesterolemia and in blue, hypertriglyceridemia and there are frequencies of distribution in the NHANES cohort. Now there is, in fact, a genetic disorder here that we term familial combined hyperlipidemia. That's different from FCS. This is a polygenic lipid disorder -- this represents about 0.3% to 0.4% of the population. So genetically driven, not driven by presence of either diabetes or obesity or any other drivers. But even though it's only 0.3% to 0.4% of the population, that's about 1.3 million people that have this disorder, and you will see clusters and families of this syndrome. But the really key observation here is how prevalent this is in people with coronary heart disease shown at the right with MI survivors and all MI survivors, something like 40% will have familial combined hyperlipidemia. So it really does lead to a lot of cardiovascular morbidity and mortality.

Now hard to treat. If you look at residual ASCVD risk despite statin therapy, 48% of our population not at LDL-C goal, 38% have high triglycerides and 26% have low HDL. This comes from a very large study done in statin-treated patients. And in these patients, really LDL control is not sufficient. And here's why. Even with intensive statin therapy, the 5-year risk of major vascular events exceeds 20% in patients with established coronary heart disease. Residual risk has not gone away. And a lot of that risk, you could attribute to the triglyceride-rich remnant lipoproteins a low HDL that statins do not fully address.

And of course, as you've heard from others on this call today, there is a pancreatitis risk. For triglycerides above 500, approximately 1% risk at 1,000, a 5% risk and at 1,771, a 16% risk. And I do see these patients referred to us. They are really quite needy patients who have had, in many cases, episodes of pancreatitis, sometimes more than a dozen episodes over a long period of time. Now we have great treatments for LDL cholesterol, but we're not getting there. And unfortunately, this is a shocking slide.

But in people with an LDL cholesterol greater than 190 milligrams per deciliter, at least 1/4 of them in recent periods of time are both untreated and unaware. And if you include the people that are aware but not sufficiently treated, it's a lot of people that we just aren't getting to goal. So where is Arrowhead heading with this dimer program?

Well, PCSK9 validated target, APOC3, now a validated target, validated for the case of PCSK9 with drugs like inclisiran, that's an siRNA for PCSK9 approved. APOC3 targeting drugs like plozasiran, also validated so that we clearly have 2 targets that we have an approach for treatment. We are hoping to be able to get simultaneous and durable reductions in LDL cholesterol in the range of 50% and triglycerides in the range of 70% or even greater with this dimer, with this dual targeted siRNA with relatively infrequent injections, that's 4 times a year. That enhances adherence. Adherence is an enormous problem in treating these patients. And the good news is the tolerability for small interfering RNAs has been excellent. We now have a number of them approved. They have very few AEs, generally just minor injection site reactions, a very well-tolerated class of drugs. So the potential to reduce cardiovascular morbidity and mortality is very high with the potential for additional event reduction by combining substantial triglyceride lowering with the established benefits of LDL-C reduction with a single therapy.

And I'm very excited that this could help us with the problems that we have with getting adherence for the long term in these patients that have very high numbers of cardiovascular events. So what are the take-home points here? Elevation of LDL-C and triglycerides affect about 1 in 10 U.S. adults at a population level and are responsible for 10% to 40% of coronary and MI cohorts. It clearly is one of the drivers of residual ASCVD risk with triglyceride-rich remnants adding to the problems of LDL cholesterol by making LDL cholesterol more atherogenic. They also have a high pancreatitis risk because of the triglyceride component. And I didn't talk about this, but the big problem we face in clinical practice is drugs like omega-3 fatty acids and fibrates, they just don't lower triglycerides enough to make a difference. And so we can engage in polypharmacy. We can add these relatively ineffective agents to LDL-C lowering, but I'm really excited about the possibility of targeting both lipid abnormalities with a single therapy given infrequently with enhanced adherence. Thank you for your attention.

Thank you. So we will now move on.

There we go.

Sorry. Okay. So here's the key takeaways from today. So we've talked about a few different programs within our cardiometabolic pipeline. What ties them all together is that they all are acting on that TG-LDL spectrum of lipid disorders. Importantly, we're also building a commercial franchise to support these complementary assets because most -- they will all have similar call points. And so from a business perspective, it makes a lot of sense for us to continue to develop these internally and independently.

We also have the potential for multiple launches over the coming years, both independent launches and with partners. We want to continue building on the momentum that we've developed with our Redemplo launch in FCS and soon potentially address high prevalence diseases such as the SHTG population, as we've heard, and as Steve has mentioned, the enormous unmet need in mixed hyperlipidemia.

Zodasiran, as Jen mentioned, targets a genetically validated ANGPTL3 pathway and still an undertreated and underaddressed population with a very severe form of hypercholesterolemia. Lastly, the promising dual functional siRNA or our dimer technology has the potential to address an extremely large mixed hyperlipidemia population, which even after a lot of innovation in the field with statins getting better in PCSK9 inhibitors, there's still a dramatic residual risk of cardiovascular disease that's just not addressed today. And importantly, we, as a company, have several key potential catalysts that will kind of give us a guidepost about where we are with these programs.

SHASTA-3 and 4 will have a top line release in Q3 of 2026, which is a really important event for the company because if successful, -- it enables a potential sNDA by the end of this year and then a launch in SHTG next year. YOSEMITE, the Phase III program for zodasiran should have full enrollment shortly, which also enables completion by middle of next year and then another NDA, which could enable another independent launch for us as a company. And then again, lastly, ARO-DIMER-PA, the dual functional siRNA, will have our first human data in Q3 of this year. And I think that, that's something that we are extremely excited about and Steve and other advisers to Arrowhead are really excited about that I think that is underappreciated from a corporate perspective and from an investor perspective.

So that's something that we are going to focus on a lot over the coming years. So thank you all for joining us today. We're going to open up the call for some questions. And I will take a few moments of silence just while we compile the questions. So give us a few minutes.

Okay. First question comes from Joe Thome at TD Cowen, and this is for Dr. Nissen, and he's asking, if plozasiran demonstrates comparable levels of acute pancreatitis risk reduction, how would you or your clinic use plozasiran versus olezarsen for SHTG and why?

Well, this is a no-brainer really. You've got a drug that the ASO class has more AEs, shorter duration of action, maybe even a little bit less efficacy. The small interfering RNA class can be given less frequently, which is very good for patients. is extremely well tolerated. And so for me, I don't think there's really any question that really the siRNA target is going to replace antisense oligonucleotides over the next several years because of the greater efficacy, tolerability and duration of action.

Next question is from Adam at B. Riley Securities, and this is likely for the whole panel. So let me -- I'll turn it to James first and then Jen and Dr. Nissen can chime in. Where is the boundary between dimer mixed hyperlipineemia population and Rodemlo's SHTG as both expand? And is there a TG level where they compete for the same patient?

Do you want me to take a first shot at that one, Vince?

Yes, take a first shot at that, James.

I think it's really one, we're treating as a pancreatitis drug in plozasiran and the other is an ASCVD drug. So it's, I think, from my perspective, defined based on the clinical presentation of the clinical problem that the patient is having. I don't know, Jen or Steve, any other thoughts on?

Let me jump in and say that it really are quite different populations. LDL cholesterol is a key driver of ASCVD and lowering it is very effective. And our hope would be that if we can also reduce these triglyceride-rich lipoprotein remnants, we will get all of the benefits of LDL-C reduction that we see with PCSK9 inhibitors plus something more. So that's the population there. But the dimer is not really intended for treating hypertriglyceridemia as an isolated disorder. It's for treating both disorders simultaneously and as a means to reduce ASCVD risk.

Maybe I'll just follow and say that I believe that our understanding of where the exact risk threshold starts for acute pancreatitis is really beginning to emerge. Previously, we just haven't had effective agents to even really understand what level of reduction would be necessary to reduce risk prior to the advent of the APOC3 inhibitors -- so drawing these kind of false dichotomies between below or above 500, below or above 880, I think that loses a lot of the nuance, and we really need to see what the final data look like from SHASTA-3 and 4 as well as our forthcoming data from the early cohorts of the dimer program to better understand that.

Next question from Prakhar Agrawal at Cantor, and this is probably a James question. Can you remind us of the trial powering for AP events? Yes, that's it.

I'm assuming that's referring to the SHASTA studies.

Yes.

So we will look at those as pooled studies. We'll pool in a meta-analysis, we'll pool both the SHASTA-3 and SHASTA-4 studies. And we took a look at this -- the study is powered based on its primary endpoint, which is reductions in triglycerides. It wasn't a priority powered around acute pancreatitis. But we took a look based on the CORE and the CORE 2 data, assuming a similar effect size and a similar rate of events in the placebo arm, we'd need to have about 9 events in the pooled studies to have around 80% power to detect a treatment difference. And then if you can get up into the teens, you're getting up to 90% power.

Next question from Ted Tentoff at Piper Sandler. This is kind of along the same lines. Can you talk through the changes to the adjudication process that we made for the SHASTA-3 and 4 studies?

Sure. Yes, I can take that one as well. In the PALISADE study, so that was our FCS study, we used the strict Atlanta criteria to adjudicate AP events. We switched -- initially, we started the SHASTA-3 and 4 studies using that strict Atlanta criteria, but we pivoted to the modified Atlanta criteria, which is similar to what was used. It's actually identical to what was used in the CORE and CORE 2 studies, and that allows for adjudication of events to be definitive pancreatitis, possible or probable pancreatitis -- we didn't have any events that required readjudication. So no events had occurred prior to us switching over to that modified criteria. And one of the things that this allows us to do is to have more events.

So we think that the transition made sense. The other thing we did around the same time when we made that transition was in SHASTA-3 and 4, we switched from having patients that had a positively adjudicated event. Previously, they would roll over into an open-label extension study. We changed that to -- such that the patients that had positively adjudicated events did not roll over. They stayed on study and stayed blinded. So that allowed for some patients to have more than one event while on study. And at the end of the study, they can go into the extension program.

And a question from Madison El-Saadi at B. Riley, and this is likely for Dr. Nissen. This is on the dimer. Is the logic to combine 2 mechanisms that hit the same disease from different angles for ASCVD? Or is it to combine 2 targets in the same pathway for deeper single access knockdown?

Yes. I'm not sure I actually understand the question there. Let me just think out loud about where I'm at here. We already know that lowering LDL cholesterol with a PCSK9 inhibitor does reduce cardiovascular events. But we also know that many of these patients have severe hypertriglyceridemia or at least elevated triglycerides. And the concept here is that where is the residual risk coming from in the patients that have their LDLs controlled. And it seems very likely based upon the epidemiology and everything that we know that it is the triglyceride-rich lipoproteins. And so think of this as a PCSK9 inhibitor plus.

And the plus is a big plus because it involves the ability to treat the triglyceride component in ASCVD risk at the same time with a single therapy for enhanced compliance and to do so durably with relatively infrequent injections. The big problem we have is, yes, we can lower LDL cholesterol with statins, but adherence is not great. And in fact, we've had lots and lots of difficulty on a societal level in getting people to the LDL levels we've targeted in our guidelines.

But if you -- if we can have something that can treat both components, the ability to have an added reduction in morbidity mortality is, I think, very high. And it will certainly reduce morbidity mortality just from the PCSK9 component alone, but we think we're going to get a lot more here.

And this is actually a follow-up to that last point. This is Eric Joseph from Citi. He is asking would you -- in a registrational trial, this is more of a clinical trial design question. In a registrational trial, would you argue for an anti-PCSK9 active comparator?

Well, that's an interesting and difficult question. That would be very difficult for one very simple reason that the sample size would likely be very large. And it's hard to imagine that, that would be the proper design. The right design here would be to say, study it against usual care, let people do whatever they want in usual care. Some of them are going to get PCSK9 in for sure, but not all of them. And some of them will get statins, some will get ezetimibe, but we'll get lower LDL cholesterol, then we'll get a lot lower triglyceride levels in the active group than we will in the usual care group. And we would counsel people for usual care to follow the guidelines.

And that's the last question we have. So I want to thank the panel: James and Steve and Jen. And thanks, everybody, for joining us today. And again, we'll be in touch on Part 2 and Part 3 of this summer series later in the summer. Thanks so much.

Thanks, everyone.

Good morning, and thank you for joining us on day 3 of the 47th Annual Goldman Sachs Global Healthcare Conference. I'm Paul Choi, and I cover the mid-cap biotech sector here at the firm. It's our pleasure to have Arrowhead Pharmaceuticals here for our first session today.

But before we begin, I'm required to make certain disclosures. These disclosures relate to investment banking and other relationships that we may have with companies discussed here today. I'm prepared to read out a lot of these disclosures to you. However, these disclosures are available to you as clients of the firm on our research portal. But otherwise, we'll go ahead and start.

To my immediate left is Vince Anzalone, who -- with Arrowhead. And then we also have, to my far left, Dan Apel, who is CFO.

What we'll do is turn it over to Vince, maybe to give some high-level comments on the company's strategic priorities for the remainder of 2026 and going into 2027. And then we'll go to Q&A. If there are any questions along the way in the audience, please feel free to raise your hand, and we'll try and get a mic to you.

But otherwise, I'll turn it over to Vince to kick it off.

Sure. Thanks, Paul. And thanks everyone at Goldman for having us today. So 2026 is -- feels like another big year for Arrowhead. We've made a ton of progress over the last few years, moving from a strictly R&D organization into a now commercial organization, but also expanding the size and the breadth of our clinical portfolio and more importantly, focusing really our late-stage R&D spend and our commercial build-out on the cardiometabolic space.

And just to review, we're an RNAi therapeutics company. We have a proprietary platform that delivers siRNA to several different cell types, seven different cell types, with five of them represented with clinical stage drugs. So for 2026, our real focus is commercial execution. And as I'm sure we'll talk about later in this talk, the readout of our upcoming Phase III studies, for SHTG for our drug plozasiran, which is marketed as Redemplo.

And then also a couple of key readouts in the earlier-stage portfolio, namely the obesity programs, a tau program for Alzheimer's, that uses a new delivery system that crosses the blood-brain barrier after a subcutaneous injection and systemic administration, which I think could be really transformational and revolutionary for the field of CNS diseases and specifically for oligonucleotides in CNS.

And then also we're going to have our first readout for the world's first dual functional siRNA or dimer. We've created a separate technology that can deliver two therapeutic siRNAs to simultaneously silence the expression of two genes expressed in the liver. That drug is called ARO-DIMER-PA. It silences the PCSK9 gene for LDL lowering, and also the APOC3 gene for triglyceride and triglyceride-rich lipoprotein lowering.

And again, I don't want to overstate, but I feel like for a first-in-man study, this data set also could really be transformational. Because the field of ASCVD has really been focused on LDL lowering and getting more convenient ways to do that and longer-acting therapies for PCSK9 inhibition. But it's really -- it hasn't focused on the other side of the equation, which is triglycerides, triglyceride-rich lipoproteins. And if we can simultaneously do both of those, we think we can have a big effect in ASCVD, which is really an enormous opportunity.

Patients with mixed hyperlipidemia, meaning elevations on both sides of that, are probably around 20 million people in the U.S. And again, I think this -- it's an early data set, but it could be transformational for the field. And so those are our main priorities. But again, I think we're -- the real main event this year is our upcoming Phase III readout for the SHASTA-3 and -4 studies, which again, I'm sure we will talk about in depth later today.

Sounds good. Maybe we'll start with the commercial side of the company and talk about FCS. Maybe just for those who may be unfamiliar with FCS, can you maybe give us a rough sense of maybe Dan, how these patients are identified? Is this part of the standard cholesterol and cardio screening panel? And just sort of what is the potential market opportunity here in FCS?

Yes. So just starting with the market opportunity. We've -- this is an ultra-rare indication. It's been varying levels of estimates about the population. So our initial estimates were, we had ranges from 1 in 1 million to 2 in 1 million to even 10 in 1 million based on genetic and then we're approved for both genetic as well as phenotypic, and so the phenotypic was even less precise.

So we had come out with initial market projections around 6,000. Our current estimates are that it's actually well north of 6,000. And so we've seen that through the success of our initial launch as well as that of our Ionis, who's come out with Tryngolza about a year ago. So -- and then first part of your question was the...

Just the -- how are these patients identified?

Oh, how do they...

Part of the standard cholesterol or other kind of screening?

Yes. So we won't give out too many details about that. It's kind of proprietary. We do have sort of the classical physician ID where we look at physicians who are treating FCS-like characteristics. And so that's a pretty easy way to determine some targeting there. We also have some consumer-based marketing to go out and identify these patients. It is very, very much an underdiagnosed condition. And then we do have a number of very proprietary, and I would call them innovative ways that we're interacting with health systems and other areas to basically help identify those that might benefit from this therapy.

Can I add something on to that? So historically, and Dan mentioned this, that it's underdiagnosed. Historically, it's really been tough to diagnose these patients because the way the disease works is that there is a problem in these patients' bodies with triglyceride metabolism. And it might be a single gene mutation, which is kind of classical FCS, or it might be multiple gene mutations, as well as lifestyle that causes these patients' triglycerides to be extremely elevated, in the thousands.

A normal triglyceride panel or reading is 150 milligrams per deciliter. These patients are in the thousands. And so they present with chronic abdominal pain and brain fog and acute pancreatitis of undefined origin. And to Dan's point earlier, our original estimate was it might be 1,000 people or maybe 3,000 or so in the U.S.

And now as disease education work that we have done as well as our competitor has done, a lot of patients are being identified earlier, and referred into specialty care. And your question is right. You can identify these just on a standard lipid panel. It's just triglyceride reading. And then for FCS specifically, you have to look at either -- you have to genotype the patients, and they have to have one of those traditional canonical gene mutations, or they can be diagnosed clinically. So they have the same syndrome without the gene signature. And that's really the new learning that we've had is that the size of that opportunity is much larger than we originally expected.

And between we and Ionis, there's probably about 1,000 patients already that are on drug after just over a year of this class being in the market. And we're not 33% penetrated in this market. We're probably -- we're less than 10%, maybe 5% penetrated. And so the disease education work is still ongoing, and that'll also be important for SHTG. But we have made the decision to start to expand our commercial footprint a bit, because the early results with commercial have been really promising.

Great. I want to talk a little bit about your early learnings from the launch here. Specifically, maybe what are you hearing with -- back from payers? What is -- what are sort of the necessary steps to get patients on drug? And in terms of your early launch, I think you've identified several hundred scripts are written so far, some of which include switches from the competitors. And on that particular point, what is sort of motivating physicians to drive switches given that the other therapy in itself is relatively new?

Yes. Yes. So I'll start and then Vince can add on to that as well. So on the payer side, I think, very good discussions, very open discussions with. I think important there is that they have all shown, or the majority have shown, willingness to have policies that basically align with our clinical criteria. So rather than coming out and looking at diagnostic scoring tools or some other sort of hurdles that might be there. They're very much having discussions, or we're very much having discussions where those policies are aligned to what we have in the label and the clinical criteria there.

In terms of switches, we talked about that on the earnings call as well, slightly over 10% currently switches, and that's really coming from a diverse set of reasons that range the gamut from efficacy to tolerability to convenience. So on efficacy, we do believe we have the more potent molecule. You probably recall that under the BALANCE trial, they had a certain number of nonresponders. So it's natural to see some switches just from nonresponse or desire to get to go on triglycerides. Convenience or quarterly versus monthly dosing. And then on the safety side, our label has no warnings, no precautions, no contraindications. And theirs has hypersensitivity and thrombocytopenia. So it's really a mix of issue. I wouldn't pinpoint to one, but we are seeing the switches.

Great. Maybe one more just on the early launch in terms of what you're hearing from your sales force in terms of feedback. What is driving potential preference share here, versus the other products? Are patients speaking to symptomatic relief? You talked earlier about brain fog, things like pancreatitis without an identifiable source. Just sort of curious what is driving, in your opinion, based on the early launch data, patient preference and behavior here.

Yes. So I think the biggest challenge is around identifying them and then ensuring that the physicians are completely familiar with the therapies that are available. In terms of physician preference, I think,they will -- they would naturally prefer a molecule that is more effective, that is more convenient for you. But both are actually, at the end of the day, very effective tools. And so it's really identifying the patients, understanding that this is the right therapy for them, and going from there.

And that's the really important part here. It's not -- we can all argue over incremental benefit of Redemplo over Tryngolza. The truth is that this class is really transformational for these patients. These are patients who've been suffering for decades with nothing. And physicians who have just been at their wit's in with no way to support these patients.

And this class, the APOC3 class just changes their lives dramatically. If you think about what they have to do to manage their disease before an APOC3 inhibitor was available, they'd have to have a severely -- or a very low fat diet, something that's totally unsustainable. And even with that, they'd still have these dramatic and severe spikes in trigs that put them in the hospital.

Typically for FCS patients, maybe multiple hospitalizations per year, and these can last anywhere from a week to two weeks -- it's very expensive to the health care system.

And SHTG -- and you haven't asked this question, but I think this is important. High-risk SHTG and FCS, whether you call it a clinical FCS or genetic FCS or multifactorial chylomicronemia syndrome, these are all different ways to describe the exact same syndrome with the same clinical sequelae. They aren't different diseases. They're the same disease. Patients can't metabolize triglycerides. They spike, and they get hospitalized. And that's really what we're trying to do here is for FCS, we are approved here.

For SHTG, we'll be making the same pitch, and we think that class share should get pretty high, because I think it's a no-brainer with physicians. If your patients have trigs that are above 500, certainly if they're above 880, certainly if they've had acute pancreatitis, you should put them on therapy.

Great. I want to turn for a moment to the European market. Your competitor is approved there, but for the genetic population, you recently had positive EMA feedback on both the genetic and population, as well as patients who present clinically for Redemplo.

Can you maybe first update us on what is sort of the timing for a potential final EU decision? And then as you think about the EU market and just sort of the commercial opportunity there, how does it compare to the U.S. market? And just how do you think about the launch trajectory over time in EU, just given the historical reimbursement challenges for various drugs?

Yes. So as you mentioned, we have a positive CHMP opinion. So we are hopeful to get -- usually leads to EMA approval. We're hopeful to get that actually this month. And then we should get, following the CHMP approval for genetic as well as for clinical FCS. So we'll be sort of the only provider in Europe that has clinical FCS under its label. So in terms of how that works in Europe, obviously, it's a slower system. So it's country by country.

Each member state will go through a separate pricing reimbursement. Germany will be first because they allow for that. We think with the label that we have on expanding to genetic FCS as well, we think that'll be an added benefit in most payers' perspective in terms of it's treating a population that has no other available treatment. And so that should help with uptake. But the -- it's sort of a country-by-country process over the next 12 months, starting first with Germany.

Let's turn to the clinical side and talk about SHASTA-3 and -4. I think the consensus expectation is that the study should be positive, and we're really mostly looking at the magnitude of clinical benefit or TG reduction here. Can you frame for us how the company is thinking about that?

What is needed to suggest clinical differentiation versus the competition? Is parity in the 60% to 70% range versus what Ionis has shown historically the appropriate benchmark in your mind? Or just how do you think about the potential for incremental differentiation here?

Sure. So both Tryngolza and Redemplo are both APOC3 inhibitors which use RNA. So the Tryngolza uses an antisense oligo, and we use an siRNA. The gene target is the same. And so it really comes down to downstream PD effect from knocking down that gene.

And we have -- Redemplo has historically, and when I say historically, it's always hard to make cross-trial comparisons. But when we start with healthy volunteers going to patients with moderately elevated TGs, going to patients with SHTG, and then ultimately patients with FCS, we have always had, as Dan mentioned, we think a more potent molecule. So better reduction of the gene target and better downstream PD. And the downstream PD would be triglyceride lowering, and then really the clinical benefit behind that, the risk of acute pancreatitis reduction. And so what do we need to show?

I don't want to put a number on it. But we would like to continue to see the same path as we've seen in all of our clinical studies up to date, which is very potent APOC3 reduction, very potent TG reduction. And then now -- and I won't go through all the different studies, but between Arrowhead and Ionis, we've now shown in three or four different clinical studies that if you do that in a high-risk population, that meaning reduced TGs, you will reduce the risk of acute pancreatitis.

Now these -- the SHASTA-3 and -4 studies weren't specifically prospectively powered to show an acute pancreatitis benefit. But what I think we learned and the field learned from the Ionis CORE and CORE 2 studies is that the background event rate is likely a bit higher than any of us really expected, and that you should see more events on placebo than we had originally modeled.

And so I think that generally, we want to see good TG lowering, somewhere in line with what we've seen previously, and we'd like to see a benefit with AP. So go ahead.

I was just going to ask on that point, since the trial is not specifically designed for that clinical endpoint, how do you think about sort of the numerical differences? What sort of maybe statistical assumptions are built into the study given, what you just said earlier about sort of higher natural background rates.? And so what would sort of be truly viewed as a, let's say, call it a good scenario versus a great scenario?

Gosh, I can bookend that. I think a good scenario would be a numerical benefit, right? So we are reducing AP risk versus placebo, and a great or a home run scenario would be statistical significance. I think the exact number, the risk reduction number, is less important than having clinical data that can make its way to Section 14 of the label somehow. And something that we can publish and that physicians can wrap their head around.

The truth is, with this population, especially the high-risk SHTG population, physicians who treat these patients, and it's a specialty market. This is not a primary care market, but the specialists that treat these patients -- they know that their AP is solely driven by elevations in TG and kind of the postprandial spikes in TGs after they have a large meal or drink an alcoholic beverage or something that lands them in the hospital. And so it's not a controversial statement for them to say that if you reduce TGs to reasonable levels, to low-risk thresholds, then you will reduce AP risk.

And so I'm not sure that the exact number is critical here for uptake. It would be certainly helpful. And we're at an investor conference, and so it would be helpful for investor conversations. But I think for treating and prescribing behavior, we just need to continue to show what we have shown all along with this program.

Great. Can you maybe remind us, between your SHASTA study and the historical CORE study, what are some of maybe the patient baseline differences, however minute they may be, or just sort of background therapies that may influence the sort of shape of the outcomes that you read out here in the coming quarter?

Sure. I'm sure you can't hear that in the audience, but we have a very loud phone that just went off. So the patient population is very similar. And the baseline characteristics are really very similar between the two programs.

You mentioned background therapies. This is a heavily pretreated population because, again, lipids or TGs show up on a standard lipid panel. A lot of the TG-lowering therapies, the omega-3s,...

That's a couple [indiscernible]

Exactly. They're generic. And they're somewhat well tolerated, and so physicians prescribe these as first and second-line treatment. So I want to say, I don't remember the exact numbers, but we're looking at probably 70% to 90% of these patients are on background therapies and probably the same things. So that shouldn't be different.

The baseline characteristics you should be thinking about when you're trying to predict AP risk reduction or the background AP event rate is two things: TG levels above 880, that tends to be the threshold at which AP risk starts to get very steep, or the curve of AP risk starts to get very steep. And then also patients who have a prior medical history of acute pancreatitis.

So the numbers there are in our studies between the two, we had somewhere between 30% and 40% of the patients who had trigs above 880. So it's a really substantial part of the study that are at high risk. And we had almost 20%, I want to say it was 17% to 19%, had a prior medical history of AP. And those are really the two predictors. And if you look at CORE and CORE 2, it's almost carbon copies. It's very similar to that population.

The baseline triglyceride level is similar. I think we're within 100 mgs per deciliter with mean or median. I can't remember the measure we were using. But interestingly, when we published our baseline characteristics about a year or so ago, we showed both screening levels and then baseline levels. And so patients come in for screening, and then they get -- I think it's three reads before first dose. And so the baseline level is actually an average of those. Screening level is the first read. There was about a 200 mg per deciliter difference in between screening and baseline of just a few months. And these patients didn't change diet. They didn't change therapy. It's just...

A fluctuation.

Exactly. Like I don't think people appreciate how variable that reading is and how much trigs fluctuate based on diet and lifestyle and also just basic triglyceride metabolism. And that's, again, why these patients get into trouble, because they get these wild swings because their body just processes TGs differently.

So it's a long way of saying we feel comfortable that the population that we have in the studies are very similar to Ionis. And so our assumptions on powering really have just looked at their results from CORE and CORE 2 and kind of imputed that on our studies, and we feel comfortable that we'll have a reasonable number of events.

Great. Maybe two more quick ones for me, and then I'll see if anyone in the audience has a question. First, you talked earlier about that sort of 880 benchmark as sort of a key population to focus on. Just curious, are you seeing different responder rates at or above that level versus below that level? And just how do you think about that influencing the outcome?

And secondly, are there different responder rates in those patients who have, let's say, a single AP event versus recurrent events? And does that potentially affect the outcome? Is there a different response profile in patients with repeated events?

Gosh, I guess my answer to that would be probably. And the answer to the first part about what we're seeing is that we're blinded to these, and so we have very little access to what's actually going on in the clinical study. So I can't really talk about that. We will be having last patient, last visit for both of the studies in the next couple of weeks, I think.

And so at that point, we have to do some QC, and then lock the database. And then we can take a look, and then we'll have our top line readout sometime this summer, over the next couple of months. So we will know and you will know at that point.

Great. You have a second study running as well, SHASTA-5, and that, I believe, is slated for next year. In a scenario where the upcoming data readout is maybe numerically beneficial, but not statistically significant, what does that mean, I guess, and what sort of onus does that put on you guys for SHASTA-5 to be positive? Because how important, in your opinion, is that to driving prescriber behavior down the road ultimately?

Yes. So SHASTA-5 was originally designed and sequenced, the timing of it, was designed to read out right about the time that we would be launching for SHTG in Europe. Because some of the payer feedback that we had gotten was that they wanted to see a clinical benefit in that population, first, to have a reasonable reimbursement rate; and second, to gain access.

And as I mentioned before, we -- and I think Ionis was in the same camp, too, didn't believe that the SHTG studies writ large would show that, were really sized or powered or designed to show that benefit. And so SHASTA-5 was the way for us to interact with European payers. Now if we get an AP -- a clear AP signal, numerical and/or statistical, for SHASTA-3 and -4, that's the time that we kind of rethink what the value of SHASTA-5 is.

I would say that just getting a positive result in 3 and 4 doesn't necessarily mean that SHASTA-5 is useless. It would be a prospective study with a primary endpoint of AP risk reduction that's event driven as opposed to time bound. And specifically in the high-risk population. And that study doesn't exist anywhere other than in SHASTA-5.

So there still might be some benefit internationally, specifically with some of the European payers. But again, that -- we would have to reassess this summer what the value of that is. And we're pretty far along in it. It's not like it's a brand-new study.

So sort of makes sense to run to completion.

Could be. But again, we would have to do that analysis after we have all the data. And also after we see what the Tryngolza label might look like, because we don't know that either for SHTG. Where does AP risk reduction show up in the label? Again, it's not the primary endpoint, so it likely won't be part of the indication statement. But how is it represented in the clinical study section of the package insert? So those will all be part of the analysis.

Great. I want to take a moment to see if there are any questions in the audience. If so, please feel free to raise your hand and we'll get a mic to you. I want to talk a little bit about pricing here in this area on SHTG. You made a price change recently the Ionis pricing announcement.

And so just sort of curious, what was sort of the background behind that? And if you see the Ionis label down the road and you have a clinically differentiated result, how does that inform your view on potentially the longer-term pricing here of Redemplo? Do you want to take that, Sam (sic) [Dan]?

Sure. Yes. So yes, as you mentioned, we recently repriced down to the WAC of $45,000. I think from the payer perspective, that was very well received, it removed uncertainty, right? So we're in ongoing, active discussions with them. And it kind of brought it down to a level that is -- where they would view it as cost comparable. So anywhere -- our research is anywhere between 15% and 20%, they're going to view it as cost comparable. And so it took out a lot of noise around those ongoing discussions. I think we clearly priced it at a premium. We indicated that as well. For all the reasons we've talked about at this fireside here, which is essentially around the efficacy, essentially around the convenience and the safety. So we do view that as kind of the price that we would move forward with. So we've mentioned one Redemplo price. So we do not plan to change that moving into SHTG. We do have an upcoming data readout, and we'll see what that looks like. But in terms of our intention right now and our expectation would be we keep it at that price, and it's well priced for the indications to come.

As you think about the upcoming PDUFA for your competitor, maybe from your perspective, what do you think is likely to be on label? And also downstream, how are you thinking about potential society guidelines in this area affecting and driving uptake of your product and the competitor's product? Do you anticipate that guidelines might have something like what's [ Audio Gap ] and so forth versus just more like symptomatic management for things like [ Audio Gap ] in that regard?

Yes. This is a space that has not had active pharmaceutical promotion for many, many years, decades, really. And so the guidelines have stayed pretty static. So right now, SHTG is defined as Trigs above 500 mg per deciliter. We have -- and our competitor in the field has kind of viewed high-risk SHTG as patients who have one of a few things. Trigs over 880 or above 500 and a history of pancreatitis. And I think that from an uptake perspective, those would be -- those high-risk patients would be the first really to be treated.

That first tier. Yes.

The first tier. But to your question about guidelines, as with any growing market that needs disease education work, as physicians bring patients in, as they understand treatment paradigms are changing, as they understand symptomatology, guidelines certainly will change over time. And we will be working with societies to make them appropriate. And what that might mean is that the spectrum of elevated TG patients, you might focus initially on that high risk and then as guidelines tell physicians treat to goal.

And that it's easier to say that than actually in practice because what is goal, right? Is to get patients below 880? Is it to get them below 500 or is it to normalize them at 150? We don't really know that yet. And so I think that the guidelines will certainly change. And that's why I think that we feel comfortable that this is a much larger commercial opportunity than really people appreciate, because there's 3 million to 4 million people in the U.S. with Trigs above 500. probably 750,000 to 1 million of those would be considered high risk.

And I think that historically, people have thought of TGs as being not really commercially attractive. You and I, right before we started here, talked about what another TG-lowering therapy, which was approved maybe 10 years ago, that had decent uptake but really didn't change the market all that much. we think that we are right now in the era where that changes dramatically. Now over -- from today to the next 10 years, I think a lot more patients will be on TG-lowering therapy, specifically APOC3 inhibitors.

We have a few minutes left, so let's maybe turn to your other pipeline assets and talk about maybe what you've recently showed at EASL and sort of benefits on reducing liver fat there. Can you maybe just talk a little bit about your efforts and which sort of pipeline candidate you view as most promising in this area?

Sure. So I'm looking at the clock, we have two minutes left to talk about the other 20-plus clinical stage drugs that we have. That's one of the challenges with Arrowhead, and I get it, that we are a very broad platform and clinical portfolio company. We talk a lot about Redemplo and about plozasiran because it's our first commercial product. But the truth is that we really have an enormously promising pipeline behind it. The programs you're mentioning are ARO-INHBE and ARO-ALK7, which are obesity-targeted drugs.

The data that we presented last month at EASL was specifically on INHBE inhibition leading to liver fat reductions, which was something that I think that we expected, but I think the magnitude of it was a bit surprising. To review the data or first to review the mechanism. This INHBE-ALK7 axis, it's a way for bodies to regulate fat storage.

So the idea is if you inhibit the INHBE gene, it stops the Activin E protein from being produced in the liver, and it stops signaling adipocytes to store fat. And what we saw in our interim early clinical data is that specifically in patients with type 2 diabetes in combination with tirzepatide, that led to a doubling of weight loss and a tripling of fat loss. And then in patients with or without type 2 diabetes, we saw a really dramatic reduction in liver fat, somewhere in the 40% to 70% liver fat reduction range with just 2 doses, I believe it was. And so those are the data that we presented.

We're starting to look at that the INHBE program as kind of potentially having two different diverging paths. One would be for MASH, that we're looking at. We're already doing design work on Phase IIs there and starting to interact with regulators on what the path would be there. And then the second would be combination therapy, add-on therapy with -- with GLP-1s for -- potentially for obesity.

Great. So much going on. Obviously, an exciting time ahead. But my thanks to Arrowhead for joining us here. We'll have to end it on that note. Thank you, Vince. Thank you, Dan.

We are here with our next company presenter at the BofA Annual Healthcare Conference. My name is Jason Gerberry. I cover Pharma and Biotech here, and I am joined by CEO, Chris Anzalone of Arrowhead Pharmaceuticals. So Chris, thanks for joining us.

Thank you. It's great to be here.

So Arrowhead has had a pretty interesting pivot point as a company. Historically, a lot of earlier-stage R&D efforts, establishing siRNA therapies for different tissue types and figuring out where your next shot on goal would be. Now you're at a point where you're pivoting to commercial, but you still have a lot going on in the pipeline. So maybe we can just start there as how you're managing that transition as a company to now becoming a commercial organization and how that altered your focus as a CEO?

Sure. So we're an And company. We're not an Or company. And commercial is critical, obviously. This is why we're all here. R&D is great, but unless you can bring the medicines to patients, then there's no point in that, right? So we've had a huge -- it's been a big transition for us to build -- to start to build out this commercial force, and it's been successful so far. But in our core, we are an R&D company, and we needed to make sure that, that drive didn't slow down and it has not. In fact, it's even sped up.

We are now able to address, I think, 7 different cell types, 5 of those are in clinical studies as we speak. We are now on the cusp of blowing out our dimer or bispecific approach. We've got an increasingly validated platform there. And so there's a ton of good opportunity there to knock down multiple genes with the same single molecule. We'll have our first data coming out of the dimer platform later this year, I guess, in the third quarter.

That's our PCSK9-apoC-III dimer. We think we can address the 20 million or so patient population in the U.S. that's mixed hyperlipidemia. Of course, our CNS platform now, we'll have our first data come out at the end of Q3, early Q4. So this is still an important part of our growth, of course, and an important part of the culture of this company, and we continue to be, I think, at the forefront of RNAi innovation.

Okay. So let's maybe start with REDEMPLO, given you recently had your quarterly earnings call that was a focus of the discussion as you -- at your commercial intro, and then we can get in the pipeline. So you've launched REDEMPLO now for FCS, and you've got pivotal data in 3Q for the larger commercial market that will drive future revenue for REDEMPLO, which is severe hypertriglyceridemia. Maybe talk about the early FCS launch, what you've learned from that, how you're able to carry forward those learnings into the eventual launch into SHTG?

Sure. So the launch has gone well so far. As we mentioned on our conference call last week, we've had more than 400 scripts in the next -- just one full quarter, I guess, of sales. And so adoption has been a bit more rapid than we expected even. This is an education market. Even FCS is an education market. Of course, the genetic FCS population, many of those folks are diagnosed, but that's, we think, quite a small portion of the overall FCS population. As you recall, in our Phase III study, we studied both clinical FCS as well as genetic FCS. And the clinical FCS are those patients that don't have the known genetic mutations associated with traditional FCS, but still have very high triglycerides, a substantially increased risk of pancreatitis.

And we -- again, we view that as the lion's share of that market. And so many of those folks will be undiagnosed or misdiagnosed. So it's incumbent on us to educate the community that those folks need to be treated. And we had -- we've been pleased with our progress in buying those patients and helping those patients. And frankly, that bleeds into SHTG a little bit. So a lot of that a portion of the high-risk SHTG population, we think can be and frankly, should be diagnosed as FCS. These are clinical FCS patients. And so it is -- I think we will be getting into what is the traditional SHTG market right now because we think those folks have been misdiagnosed as having severe hypertriglyceridemia and where they should be diagnosed with having FCS.

Okay. So with FCS, my sense was some of it was patient identification and then the other part was, as you alluded to, maybe educating the doctor. As we think about SHTG and the challenges, my sense is it's less about patient identification and perhaps more educating the health care provider on the importance of treating and preventing acute pancreatitis. Do I have that distinction correct?

So I think that's right. Although those are related, of course. I think there's tons of patients walking around who should be treated, who should get their TGs in under control, and they have no idea that they're at risk. And frankly, their physicians may have no idea that they need to get them under control. And so the sharpen the spear there is are those physicians. This is a brand-new market. Folks aren't used to think about triglycerides as bad actors. This is a bad analogy because it's ASCVD.

But think of this almost as monitoring LDL decades ago before there were statins. People didn't know that they should be looking at their LDL and then statins came around and [indiscernible] this is something that we should all be thinking about. We think that elevated triglycerides are similar in that and that they have -- people have not monitored their TGs, even physicians haven't really monitored TGs. But at least for the severe population above 500, they should be looking at that, and we think they should all get under control.

Now this is a multistep process, right? The first step, I think, has been to help the community understand the severity of FCS and get those patients treated, both genetic FCS and clinical FCS. The next step is SHTG more broadly. These are the high-risk FCS patients -- I'm sorry, high-risk SHTG patients. And so these are folks with triglycerides above 880 with or without a history of pancreatitis. We think there's 750,000 or maybe 1 million of those folks in the United States -- there's increasing data from our competitor as well as from our own studies that those folks are at high risk of pancreatitis.

And so we need to help the community understand that we absolutely need to get their TGs under control. I think the next step then is the less severe SHTG population. These people who treat with triglycerides at 700 milligram per deciliter or 600 milligram per deciliter. We are really looking forward to seeing what our pancreatitis data look like in SHASTA-3 and SHASTA-4. Our competitor showed very good data, very promising data, and most of those acute pancreatitis events were in the very high-risk population.

We're looking forward to seeing whether or not you see events in those less-traditional severe population. If that's the case, then that is the third step in this market where physicians start to understand, you know what, it's not just the high-risk folks who need to get under control. It's anybody who has trigs above 500 that we need to get under control.

Okay. And so as you mentioned, this is a 2-player market in APOC3-modulating drugs with Ionis's Tryngolza. As we look ahead to the SHASTA-3, SHASTA-4 study readouts based on some of the Phase II work that you've done, FCS work, what do you think, a, in terms of potential clinical differentiation for REDEMPLO in SHTG and does it ultimately matter? Or is this a big category, 2 players can grow it and 2 players can kind of enough to feed?

Yes. Look, this is -- it's a big category. There's a lot of patients who need treatment, and there's a lot of education to be had. And I just think that this is better served, frankly, by 2 players than payer -- one player. And has a good drug, and that's helpful. And so I think that we will grow this market much more rapidly, much more completely with 2 of us rather than one of us. And again, there's plenty of room for both of us to be successful there.

Now with regard to what we're going to see, who knows? This will read out in the third quarter. Last patient, last visit in SHASTA-3 and SHASTA-3 is towards the end of June. And so once we lock the database and analyze data in action. We can at least topline this. We expect a good safety profile. We have seen that now in many, many patients, we expect that to continue. We don't see hypersensitivity. We don't see thrombocytopenia. The question here is, I guess, do we see an increase in liver fat. We don't expect to see that, but our competitor has seen that. And so we'll see if that is another differentiator for us. I just don't know at this point. With triglycerides, that is the approval endpoint, lowering triglycerides.

We've seen that in spades. This essentially works in 100% of people. We had no nonresponders in our FCS Phase III study. Our competitor had about 20% nonresponders. And so we expect that to continue. This is not one of those, I don't think, scary binary Phase III readouts where drug is either worth a lot or worth 0, depending upon what the data show; the drug appears to work well and consistently. And so I think it's going to work, and we'll see very good -- my expectation is we'll see very good reductions of triglycerides.

Now, will we see an improvement in pancreatitis? We will see. We were really pleased to see that Ionis showed that. Those data were good. And historically, we've seen, frankly, better TG reduction than Ionis. And so we would expect that, based on that, we've got a good chance. These are still small-ish numbers, and there's funny things can happen with small numbers, and so you never know until you know. But we are cautiously optimistic that we will see an improvement in pancreatitis once we have the full datasets.

Yes. Okay. So you guys have been vocal about that this is a category and a value proposition of drug that's worth a price premium. I think you've talked a lot about in the past about MASH drugs. You priced at a slight premium to Tryngolza presumably on the quarterly convenience dynamic, I would assume. I know you don't want to specifically comment on gross-to-net, but from everything I hear from you guys, it sounds like you don't think this is a category where you need to offer huge concessions in terms of rebates and discounts.

Mindful that there are some things that perhaps are a little bit out of your control, probably and that's what limits your ability to guide to it today because you have a competitor that still has to go through those negotiations and that kind of impacts how you kind of have to respond. Is that a fair summary of the pricing dynamics because it is a very topical aspect of the story right now with investors.

Yes, I think that's fair. I don't know what the gross-to-net is going to be, but qualitatively, we don't expect to aggressively even discount this. Think of the way I think about this is not as necessarily a triglyceride-lowering drug. I think about this as a pancreatitis drug. Our goal here is to lower -- substantially, hopefully, lower the risk of pancreatitis in patients with severe hypertriglyceridemia. And as you point out, that feels to me more analogous to a MASH market.

And so this to me feels like it should be a premium-priced product. Now as it relates to our competitor, we're comfortable with a list price that is a slight premium to theirs because we think we've got -- we think that the data support that, right? It's more convenient dosing once a quarter rather than once a month. The safety profile is substantially cleaner, and at least historically, our TG reduction has been better.

Again, not to wipe my feet on Tryngolza, I think that's a good drug. I think that their data have been impressive and have been really helpful for a lot of patients. I just think that we can -- that we should price a slight premium to that given these other benefits.

Yes. Okay. So the SHTG pivotal, the primary endpoint of triglyceride lowering, that seems like a very highly de-risked endpoint. Thus, the focus is on the key secondary endpoint, which is acute pancreatitis benefit, which is important, I think, across all geographies. Our general sense is if your event rate was similar to core, you've got a very good chance of showing stats as long as nothing in the statistical hierarchy gets in the way.

If it's kind of mid-teens number of events in absolute numbers, then you just need to show a really high absolute reduction, but could still hit stats. Is that sort of a general sense? And ultimately, I do wonder how much of this matters if your benefit on trigs and apoC-III is as good or better, and it's just a function of trial design where maybe there are some differences in either percentage of AP reduction or the statistical parameters.

I think that's all fair. And we do have belt-and-suspenders here. We designed SHASTA-5 a while ago that is powered to show an improvement in pancreatitis, and that's ongoing, and it's an event-driven study. And so that will -- assuming that we continue with that study. And we'll see when SHASTA-3 and SHASTA-4 readout if we hit on acute pancreatitis, it could be that we decide to shut down that study. But it's ongoing. And so one way or the other, I think we will have this on the label.

I think our lives are easier; we can show it with SHASTA-3 and SHASTA-4. But ultimately, to your point, these are still small-ish numbers, and funny things can happen in the small numbers. And if that's the case, then fine. Our commercial team is going to have to work a bit harder. But as long as we're seeing very good TG reduction and good apoC-III reduction, this -- we still would expect to see good adoption.

What's the time line for SHASTA-5 in a scenario where you do have to roll that out to completion and get those data from the outcomes trial versus, say, your pooled SHASTA-3, SHASTA-4?

It's a bit hard to say because it's an event-driven study; as I said, it's accruing patients now. We've seen events. And so it's ongoing. I can't give you a good idea about when that could read out. I just don't know.

Okay. And to your point, in a scenario where if you didn't have it from the initial pooled analysis, just makes life a little bit harder. Is that more commercially with doctors and in those discussions with payers? Or is it all about OUS and the pathway there?

Yes. It's a good question. I think it's not about payers in the United States. I don't think that showing AP is gating for payers in the United States. We feel good about that. It will require our commercial team to talk a bit more with providers potentially about the drug and show our data. And our commercial team likes to say that if you're explaining, you're losing. And so it will take an extra step or 2 for them.

But look, we have a drug that works. And so I think that we can get around that. I think your point is a good one about ex-U.S. I think that in some geographies, we're going to truly need to have AP on the label in order to get reimbursed. And so again, hopefully, we see it in SHASTA-3, SHASTA-4. But if not, we have SHASTA-5 where we're quite confident that we would see it.

Yes. And I hate to belabor the point, but I just wanted to make sure, if you think about SHASTA-3, SHASTA-4, the main differences or uncertainties as you think about projecting the number of events? Is it that it's 25% smaller study? Is it that we just don't have a lot of data around AP events, and we're talking small numbers. And so perhaps that's a little bit tricky or maybe any slight differences in baseline characteristics, say, versus the core study? How would you kind of rank order those uncertainties?

Yes, I think it's 1, 2, not 3. So our baseline characteristics are quite similar to CORE and CORE2. So I feel good about that. But it's -- I think maybe these numbers are wrong, but we have around 750 people. And so that's not a huge number. And small numbers can have funny effects. So it's really just that. It's only a 1-year study, right? If we are carrying this out for more than a year, for 2 years or 3 years, for sure, we'd be quite confident.

But let me take a step back. So when we first designed SHASTA-3 and SHASTA-4, it was not powered to show AP. That's why we decided to design SHASTA-5. And when -- and so we didn't have any expectation at all of showing any improvements in AP in SHASTA-3 and SHASTA-4. And then when people would ask us about the own studies, CORE and CORE2, they would ask us if we thought they would show AP in those. And we said, absolutely not. This pancreatitis event is severe, but it is -- it doesn't happen every day.

And so we didn't think they were going to show it. Well, they did show it. And we are seeing events in SHASTA-3 and SHASTA-4. What we learned and the field has learned is that pancreatitis -- TG-related pancreatitis is a lot more common than we all used to think it was. And so it just underlines the fact that these patients really do need to be treated, not just those severe patients above 880 with history of pancreatitis, but really anybody with substantially elevated triglycerides. So we are now, again, cautiously optimistic that SHASTA-3 and SHASTA-4 will show it. And we are also much more confident that this is -- these are important drugs that need to get to patients.

Okay. Last question, just -- do you think this is a category that ramps and launches fast, given some of the patients who are high risk, who've had past AP events, I presume that they would be highly motivated to treat and I think Ionis has guided to like a $3 billion in peak. Is that a rough proxy of how you see REDEMPLO peak in the U.S.

Yes. I'll be a bit more aggressive on that. I think the peak for us is $3 billion to $4 billion, but that peak is not going to happen in the first 6 months. This is an education market. And so I do expect a bit of a -- boy, slow is a strong word. I wouldn't use the word slow, but I'll use the word slow. I expect a bit of a slow adoption curve because this really is an education play. Again, I'm glad that there are 2 good drugs out there, and there are 2 companies that are bringing the story to providers and to payers, but that will take a bit of time.

Yes. Okay. And then maybe shifting gears to obesity in the last 10 minutes, I got a couple of pipeline topics to hit INHBE plus tirzepatide, more data this year. I think the goal is to improve the weight reduction, maybe 5% versus tirzepatide alone. Maybe the additional data you expect to generate here, how that will inform your confidence level on a go-forward strategy, I imagine in type 2 obese patients would be a play for INHBE. Is that right?

Yes, yes. So we've thought all along, even before we started clinical studies for ARO-INHBE, we always thought that the play here, if there's a play, if this translates from animals to humans, the play is in combination with the GLPs. Those -- that's a good class of drugs. There's no reason to try to make this a monotherapy. And frankly, I think the biology doesn't support that. But we always thought that this could be a powerful addition to GLPs to increase weight loss potentially and more importantly or equally importantly, to make that high-quality weight loss. And we saw that in the early data.

And we really saw that in this obese diabetic population. We saw a doubling of fat reduction and a tripling of liver fat reduction. And so that was really eye-opening to us. It wasn't entirely shocking to us, but it was eye-opening and important. And so we are designing Phase II studies as we speak. I expect to start those this year, where we will be looking at that population, and we'll be looking at INHBE to contribute to -- as a MASH therapy as well as potentially obesity therapy. Okay. And sorry, one more thing on that.

And there are additional good targets in the liver against obesity. And so we talked about or I mentioned earlier, this burgeoning platform we have in dimers, and we have an awful lot of interesting ideas about what we can combine in a dimer or bispecific with INHBE to make it an even more complete and powerful drug class. And so I think you'll hear more about that into '27 and beyond.

Yes. And so if we were to think ahead, the 5% seems very relevant to the regulatory bar. What else in terms of composition or blood sugar, do you feel like is table stakes to having a differentiated product that can compete given just how competitively intense obesity is, and we know that Lilly's retatrutide can push the boundary even further for weight loss reduction. So I imagine how are you thinking about some of those other aspects of the profile?

Yes. We'll see. I don't know if INHBE is -- will be helpful with blood sugar. I just don't know; it's too early to tell with our data now. But what appears to be good at is moving fat around in a healthier fashion, getting fat out of -- decreasing liver fat, decreasing visceral fat and liver fat. I think that's important and retaining lean muscle mass. Look, if we have something that could enable patients to use a relatively low-dose of a GLP, tirzepatide or standard GLP-1 and get better weight loss with a lower dose of those and have that a higher-quality weight loss, and potentially treat a fatty liver, I think that's a really compelling set of possibilities.

Yes. And so then what would you be looking for ALK7? Is it maybe proof of principle on adipose targeting and that opens up the door for a lot of other things that could be interesting? Or hey, we don't know. We just want to see what the data is and then we'll kind of inform you on maybe the strategy on how to utilize this tool and what it may be beneficial for.

Right. Yes. So we think this Activin E-ALK7 axis is really interesting biology. And so interrogating ALK7 is really essentially a different way of interrogating this axis. And we think it's interesting. And so I look forward to seeing what that looks like. But you're right, the value here is at least, well, I guess, threefold. One, let's see what ALK7 does in terms of weight loss. We are a bit -- we are, what, 2 quarters behind Activin E with ALK7, but also the MAD portion of that study, the doses are separated by 3 months rather than 1 month.

So it just takes us a bit more time to generate those data. So you'll see more data second half of this year. Let's see what that looks like. We're excited to see what that looks like. So that's value -- potential value, number one. Potential value number two is, as you mentioned, this opens the door to our ability to deliver to adipose. We've seen really good data in animal studies. Let's see if it translates into humans. If it does, there's a number of good targets that we can go after.

And so I think that is a value-creation event. And the third is, as with INHBE, this is a potential component of a dimer approach. What if you can knock down ALK7 and something else. And there's several good targets that we like in adipose that we can think of pushing in the clinic sometime in '27, maybe even beyond. So we look forward to seeing these data, and we look forward to this being potentially a franchise of its own.

Okay. So I imagine between the work you're doing on your PCSK9-apoC-III dimer, if that looks good, if the obesity assets look interesting, companies in your space eventually do need to consider partnering at a time just given constraint of resources and the ability to maximize what you're working on. So I think you moved off of obesity as a partnership candidate. Could that be revisited? I'm just curious, I imagine anything can be revisited.

Yes, anything can be revisited. Look, we reported on our last conference call -- Form 10-Q last week, about $1.8 billion of cash. And so we're well capitalized. We are positioned to take all of these forward ourselves, and that's our posture right now. I think there's a ton of value there. That may change at some point in the future, but right now, at least we really like blowing out obesity ourselves, not just INHBE and ALK7, not just the dimers that could be made with those 2 candidates, but other ones. I mentioned CNS. They're really interesting obesity candidates in the brain, and we'll have data from ARO-MAPT, our first subcu administered CNS drug.

And we'll have data later this year. And if that's positive, then that opens up a whole new area for obesity, talking about obesity. So we want to hold on to that. Cardiometabolic between plozasiran and zodasiran. Zodasiran is our ANGPTL3 program where we're treating HoFH patients. We have no interest in partnering either of those. We're going to bring those forward ourselves. The dimer safety PCSK9, apoC-III, that has a big opportunity to treat the 20 million or so people with mixed hyperlipidemia; we want to hold on to that ourselves. And then, let's see where we sit with the broader CNS platform.

Yes. Okay. So we only have like 2 minutes. So I'm going to lump these 2 assets together in one question, which is your MAPT and your ALK7 data updates this year. Right to think about these as primarily safety and you just want to see deep target knockdown, and that's going to be the key learning that will inform, hey, we got something here. Let's keep going.

Yes, I think that's fair, particularly for MAPT. The data we'll have this year is just in healthy volunteers. I think that's important. Let's see if this translates from NHPs to humans; let's see if we get good knockdown of tau. Let's see if we -- this is well tolerated. If those are the case, it opens up a lot of opportunities for us in CNS and beyond. And we're preparing for that. We've got a number of CNS programs behind that, that should this initial readout be positive, we're going to push as quickly as we can.

And so I think you'll see a number of new CNS candidates in clinical studies in 2027, and you might see the first one at the end of 2026. So certainly MAPT. For ALK7, same thing. We are really interested in safety. We're really interested in knockdown. But look, let's -- we're also interested to see if this Activin E/ALK7 axis translates from animals to humans that we do see some effects in terms of maybe weight loss, but also in terms of fat distribution.

Okay. So if we think about MAPT and if you do validate systemic delivery, some of the opportunities that may open up? Or should we be thinking about that as some of the areas where maybe intrathecal ASOs have been studied, but like Huntington's that -- or even ALS or different Alzheimer's settings or targets, I should say, like what does the menu of options start to look like?

It's a large menu. So certainly, all those things. But there are other conditions. I don't want to pick on obesity, and that's not our sole focus, obviously. But let's talk about obesity. It's inconceivable to me that an obesity therapy could be administered via intrathecal injection. It is certainly conceivable that an obesity therapy could be a simple subcu injection at home once every 2 or 3 months.

And so it opens up less severe, if you will, diseases if we can -- if we really can translate the systemic delivery from animals to humans. And so it runs the gamut from grindingly awful neurodegenerative conditions to things like obesity that are less severe.

Okay. Well, we're out of time, and there's a lot we didn't get to cover, but I appreciate your time and the insights as always.

Of course, thank you.

Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals Conference Call. [Operator Instructions]

I will now hand the conference call over to Vince Anzalone, Senior Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.

Good afternoon, and thank you for joining us today to discuss Arrowhead's results for its fiscal 2026 second quarter ended March 31, 2026. With us today from management are President and CEO, Dr. Chris Anzalone, who will provide an overview; Andy Davis, Senior Vice President and Head of the Global Cardio Metabolic franchise, who will provide an update on commercialization activities; Dr. James Hamilton, Chief Medical Officer and Head of R&D, who will discuss our development programs; and Dan Apel, Chief Financial Officer, who will give an overview of the financials. Following management's prepared remarks, we will open the call to questions.

Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact are forward-looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statements. For further details concerning these risks and uncertainties, please refer to our SEC filings, including our most recent annual report on Form 10-K and our quarterly reports on Form 10-Q.

I'd now like to turn the call over to Chris.

Thanks, Vince. Good afternoon, everyone, and thank you for joining us today. During the fiscal second quarter and the period since our last earnings call, we have continued to execute well against our commercial, R&D and corporate goals. Arrowhead is now on the strongest footing of our history. We are commercial. We have a clear line of sight to expand our commercial opportunities and footprint. Our pipeline is larger than ever. Our discovery capabilities are broader than ever, and our balance sheet is stronger than ever. This is a historic time for our company. We are uniquely positioned to deliver important medicines to patients who need them and to create substantial value for our shareholders.

Let's talk about some of our recent progress and begin with commercial. As you recall, the FDA approved REDEMPLO in November 2025 as an adjunct to diet to reduce triglycerides in adults with FCS. FCS is a severe rare disease with an estimated 6,500 people in the U.S. living with genetic or clinical FCS, characterized by TG levels that can be 10 to 100x higher than normal. This leads to a substantially increased risk of developing acute, recurrent and potentially fatal pancreatitis.

As we reported last quarter, the U.S. REDEMPLO launch was off to a strong start. That momentum has continued into the current quarter and we are now seeing around 30 new prescriptions written each week. Greater than 400 prescriptions have been written since launch and more than 10% of these have been for patients switching from our competitors' APOC3 inhibitor. Of course, each prescription needs to be fully adjudicated with payers before becoming paid claims, but we offer a robust quick start program to support these FCS patients in the interim. The volume of physicians writing prescriptions and the number of patients receiving REDEMPLO continues to exceed our initial expectations.

With respect to pricing, we updated REDEMPLO's U.S. wholesale acquisition cost or WAC to $45,000 per patient per year. This represents a premium to our competitor's WAC pricing. We believe this is appropriate given that clinical data suggests we have a clearly and demonstrably superior product in terms of TG reduction, safety profile and convenience. As part of the One REDEMPLO unified pricing model, this price is intended to remain consistent across FCS and SHTG if that indication is approved. We continue to see this strategy as potentially simplifying payer contracting and eliminating pricing complexity that could complicate future formulary negotiations. Response from payers to this strategy has been positive and our interactions to date have been productive.

Beyond the U.S., we secured positive regulatory action in 4 additional geographies for REDEMPLO in patients with genetically confirmed and clinically defined FCS. We received approvals from the Australian Therapeutic Goods Administration, the Chinese National Medical Products Administration and Health Canada. In addition, the European Medicines Agency's Committee for Medicinal Products for Human Use adopted a positive opinion, recommending the approval of REDEMPLO. This is an impressive result achieved by our global regulatory team in a very short period and further reflects the strength of our clinical data in FCS and the value that REDEMPLO offers to patients.

REDEMPLO will be available later this year in Canada, and we anticipate it will be marketed independently by Arrowhead. Pending a marketing authorization decision from the European Commission, we expect to launch REDEMPLO later this year in select EU countries and likely in the U.K. as well. In Greater China, REDEMPLO will be marketed by Sanofi.

In addition to our regulatory team, the rest of the R&D organization has performed extremely well and has made progress in the broader portfolio. Our drive to expand our platforms in order to increase the number and types of diseases we can address continues even as we grow as a commercial entity. During the recent period, we have made rapid progress across the pipeline, including programs targeting genes expressed in liver, skeletal muscle, adipose, CNS and the lung as well as the first dual functional siRNA designed to silence the expression of 2 genes with a single molecule.

We believe the depth and breadth of our clinical pipeline is unmatched and we expect to continue to lead the field in innovation. Importantly, many of these programs will have clinical readouts this year, so investors and others may start to properly value the broader pipeline.

As we look to near-term clinical data releases, we anticipate 4 important events. First, the Phase III SHASTA-3 and -4 studies of plozasiran in SHTG patients should be ready for top line data release in Q3. This is an important readout that will drive our anticipated supplemental NDA or sNDA as we seek to expand the population of patients we can treat with plozasiran. We expect to continue to see a favorable safety profile and substantial reduction in TGs and we are cautiously optimistic that we could see an improvement in acute pancreatitis risk.

Second, we expect to have early data from the ongoing Phase I/II study of ARO-DIMER-PA in patients with mixed hyperlipidemia in Q3. We believe this will be the world's first clinical data of a single RNAi molecule designed to simultaneously silence the expression of 2 proteins. If we see good reduction of PCSK9 and APOC3 and therefore, reductions in LDL-cholesterol NTTs, we could have a very powerful and unique therapy for roughly 20 million people in the U.S. living with mixed hyperlipidemia. More broadly, the data could provide initial clinical proof of concept for our growing dimer platform and pipeline. We expect to see additional dual functional dimers in the clinic in 2027.

Third, we expect to have early data from the ongoing Phase I/II study of ARO-MAPT around the end of Q3 or early Q4. As you recall, this is our first candidate using our CNS platform designed to deliver RNAi molecules to the brain via simple subcutaneous administration. Our MAPT targets -- sorry, ARO-MAPT targets the tau protein, which is increasingly validated for the potential treatment of Alzheimer's and other tauopathies.

We believe that positive early data could be substantially disruptive. It could represent a great move forward in treating tauopathies and more broadly open the door to using RNAi to treat a broad range of conditions from neurodegenerative disorders to obesity. The early ARO-MAPT data are encouraging. We expect a substantial expansion of our CNS pipeline beginning at the end of 2026.

Fourth, we expect to provide clinical updates on ARO-INHBE and ARO-ALK7 throughout the second half of the year. Regarding ARO-INHBE, we plan to present additional data at various conferences and launch a Phase II study. For ARO-ALK7, we expect to provide additional data from the ongoing Phase I/II study. We see these as potentially important therapies for metabolic disorders and represent our first steps into obesity and NASH. We expect to have additional candidates in this space by the end of the year and into 2027.

Moving on to financial and portfolio management. Arrowhead took important steps to ensure that we are properly funded to advance our commercial and development portfolio. We also entered into a license agreement for a program that achieved clinical proof of concept, but it's not one that we wish to take forward. This is key to Arrowhead's strategy since we are extraordinarily productive in discovery and early development but cannot commercialize everything independently.

Let's talk about the steps we took. First, we dramatically strengthened our balance sheet, allowing us to push multiple programs toward commercialization and potentially through multiple independent and partner launches. During the quarter, we completed the largest fundraising Arrowhead has ever conducted. We closed concurrent public offerings of $700 million of 0% coupon convertible senior notes and $230 million of common stock. Both offerings were several times oversubscribed, reflecting investor confidence in our portfolio and our ability to continue to build value.

Second, and just this week, we announced an exclusive worldwide license agreement with Madrigal Pharmaceuticals for ARO-PNPLA3, Arrowhead's clinical stage program designed to treat a genetically defined population of NASH patients. Under the terms of the agreement, Madrigal will pay a $25 million upfront payment to Arrowhead. Arrowhead is also eligible to receive development, regulatory and sales milestone payments of up to $975 million. Arrowhead is further eligible to receive tier royalties up to mid-teens.

Madrigal's leadership in the NASH space makes it a natural and attractive partner to advance ARO-PNPLA3 into Phase II studies and towards potential commercialization. The transaction with Madrigal underscores Arrowhead's disciplined business development strategy, demonstrating our ability to partner high potential clinically validated programs with leading organization.

With that overview, I'd now like to turn the call over to Andy Davis. Andy?

Thank you, Chris, and good afternoon, everyone. It has now been approximately 5.5 months since the FDA approval of REDEMPLO on November 18, 2025, and we continue to be very pleased with the trajectory of the launch. Today, I would like to cover 5 areas: prescription and patient dynamics, payer coverage development, pricing strategy, commercial infrastructure expansion and our international and SHTG outlook. Let's start with prescription and patient dynamics.

REDEMPLO's launch continues to build strong and consistent momentum. Through the fiscal second quarter ending March 31, 2026, we have seen prescriptions accelerating week-over-week, growing nearly threefold from the start to the end of the quarter. That momentum has continued into the current quarter with total prescriptions written exceeding 400, representing over 40% growth over just the last 4 weeks alone.

The awareness and conviction driving this prescription growth are encouraging. REDEMPLO awareness among the prescribers who matter most has increased meaningfully. Critically, this awareness has translated into conviction. Nearly all REDEMPLO prescribers surveyed report being satisfied or highly satisfied with the product, and REDEMPLO is perceived strongest on the efficacy outcomes SCS patients care about most, triglyceride reduction and acute pancreatitis risk reduction.

The patient mix continues to reflect what we expected. Approximately 85% of prescriptions are from patients naive to the APOC3 class, a strong signal that physicians are identifying and treating FCS patients who have never had access to an effective therapy. Switch patients largely account for the remainder. Patient persistence data is equally encouraging. We feel activity is accelerating meaningfully, an important early validation of both clinical effectiveness and patient satisfaction for REDEMPLO's once quarterly dosing profile.

Geographic distribution of prescribing is balanced across the country. This breadth of prescriber activation across all territories signals that patient identification capability is building at scale across the organization, not just concentrated in a handful of high-volume centers, and this gives us confidence in the durability of the prescription growth trajectory.

Turning to payer access. We are making meaningful and consistent progress. Our market access team has been actively engaged with the largest payers in the country, covering the vast majority of U.S. lives to support continued patient access. These discussions are proceeding as expected and in some cases, have already led to REDEMPLO's improved coverage. Additional formulary coverage decisions are expected in the coming months across both commercial and government segments.

A particularly important development in the payer landscape is the diagnostic pathway flexibility that major payers are recognizing. The coverage policies taking shape across major payers reflect both genetic testing and clinical criteria as valid routes to diagnosis. This is critical for ensuring that all appropriate REDEMPLO patients can access treatment because a meaningful proportion of real-world SCS patients are clinically diagnosed rather than genetically confirmed and policies that require genetic confirmation as a prerequisite would create an unnecessary and inappropriate barrier.

As Chris mentioned, we have made a proactive decision to reduce the list price of REDEMPLO to $45,000 per patient per year. This decision reflects our commitment to optimizing market access for FCS patients and is consistent with our belief that a competitive and rational price point accelerates formulary decisions and reduces friction in the prior authorization process. We have always believed that REDEMPLO's clinical profile is best-in-class and the $45,000 per year price point reflects the premium value supported by the clinical evidence.

With the FCS launch performing ahead of our expectations and with potential expansion into SHTG on the horizon, we are making deliberate and sequenced investments to scale our commercial infrastructure. I will speak more on this in the future, but the field infrastructure we are building will be sized and structured for both the current expanded FCS accessible population and also the future SHTG opportunity as it unfolds in the future.

On international expansion, REDEMPLO received regulatory approval in both Canada and China in January and most recently in Australia last month. All 3 markets are currently in prelaunch phase as we work through the pricing and reimbursement frameworks in each country. We look forward to providing updates on those time lines as they develop. Also last month, CHMP, the Committee for Medicinal Products for Human Use, recommended EU marketing authorization for REDEMPLO in Europe for FCS without requiring genetic confirmation. Consequently, we anticipate an EMA approval decision in the June to July time frame.

We intend to commercialize REDEMPLO directly in Europe, supported by contracted infrastructure, which encompasses market access strategy, account management deployment, medical science liaison support and broader stakeholder engagements, including medical congresses and patient advocacy group engagement. We believe this model is the right approach for Arrowhead and are pleased with the readiness of that team as we approach the anticipated EMA decision.

Finally, I want to comment on the SHTG program, which represents the most significant near-term value catalyst for the cardiometabolic franchise. We are approaching what we expect to be a highly meaningful series of milestones. Top line results from SHASTA-3 and SHASTA-4, our 2 registrational Phase III studies in severe hypertriglyceridemia are expected in Q3. We head into the data readout with confidence grounded in the strength of REDEMPLO's established mechanism of action and the consistency of the APOC3 biology we have observed across our full clinical program to date.

We also intend to present the data at a major medical congress, which we hope will be with a simultaneous publication in a top-tier medical journal. We then expect to file an sNDA with the FDA before the end of 2026 with an anticipated regulatory approval based on an expected standard review time line targeted in second half of 2027. Additional regulatory filings in other jurisdictions are planned to follow thereafter. The SHTG opportunity represents a patient population that is substantially larger than FCS with over 1 million high-risk patients in the United States alone. The commercial infrastructure investments we are making for FCS today are also designed with that launch in mind.

In summary, the REDEMPLO launch is progressing well and continues to exceed our expectations across prescription volume, patient dynamics and payer access. Physician satisfaction and forward prescribing intent are both extremely strong. Refill activity is accelerating and we have a series of highly anticipated milestones in the second half of 2026 that we believe will be transformative for the cardiometabolic franchise and for Arrowhead.

With that, I'll turn the call over to James Hamilton to discuss the broader R&D portfolio.

Thank you, Andy. As Chris mentioned, we have a very broad pipeline with over 20 clinical programs, so I will focus on areas with upcoming readouts. First, I'd like to announce that we are planning to host 3 webcasts over the coming months as part of our R&D webinar summer series. Each webcast will cover a specific aspect of our pipeline where we expect to have upcoming data readouts this year. These include cardiometabolic, including plozasiran, zodasiran and ARO-DIMER-PA, obesity, including ARO-INHBE and ARO-ALK7; and ARO-MAPT, including the blood-brain barrier or BBB platform.

I'll now give status updates from the quarter on these specific areas. First, let's review the suite of plozasiran Phase III studies, SHASTA-3, SHASTA-4, SHASTA-5 and MUIR-3, designed to support supplemental NDA filings to expand the REDEMPLO label beyond genetic and clinical FCS into patients with SHTG. SHASTA-3 and SHASTA-4 together enrolled over 750 patients and have a primary endpoint of change in triglycerides from baseline with key secondary endpoints of acute pancreatitis rates.

MUIR-3, which enrolled over 1,400 patients is designed to supplement the SHASTA studies with additional patient safety data. We are also enrolling patients at high risk of acute pancreatitis into SHASTA-5 to directly assess the ability of plozasiran to reduce the risk of acute pancreatitis as the primary endpoint. Should SHASTA-3 and SHASTA-4 show a statistically significant improvement in acute pancreatitis risk, we will reassess whether there is added value in continuing SHASTA-5. We remain on schedule to complete the blinded portion of the SHASTA-3, SHASTA-4 and MUIR-3 in mid-2026 to support a planned top line data readout in the third quarter. This would further support our plans for an sNDA submission for SHTG before the end of this year.

Before moving on to zodasiran, I'd like to highlight a presentation we made with new long-term efficacy and safety data for plozasiran across a spectrum of patients with hypertriglyceridemia at the American College of Cardiology Conference in March. The data were from a 2-year open-label extension of the 2 Phase IIb double-blind placebo-controlled studies of plozasiran. SHASTA-2 conducted in adults with severe hypertriglyceridemia and MUIR, which enrolled patients with hypertriglyceridemia.

During the 2-year open-label extension, patients saw median reductions in their triglycerides of 83% in SHTG patients from SHASTA-2 and 67% in HTG patients from MUIR with additional reductions in random and non-HDL cholesterol. 96% of SHTG patients achieved TGs below 500 milligrams per deciliter and 63% achieved TGs below 150 milligrams per deciliter with 93% of HTG patients achieving TGs below 150 milligrams per deciliter.

Importantly, no adjudicated acute pancreatitis events occurred in any patient receiving plozasiran during the 2-year Phase IIb open-label extension study. These findings support the potential of plozasiran as a promising new approach to managing patients with moderate to severe HTG phenotypes who are at risk of AP and potentially other cardiometabolic comorbidities.

I'd now like to give a quick update on the YOSEMITE Phase III study of zodasiran, which is being developed as a potential treatment for homozygous familial hypercholesterolemia or HoFH, a rare genetic condition that leads to severely elevated LDL cholesterol and early onset cardiovascular disease. Zodasiran is the fourth investigational RNAi-based candidate developed by Arrowhead to reach late-stage clinical studies.

YOSEMITE is designed to enroll approximately 60 individuals with HoFH over the age of 12, who will be randomized 2:1 to receive 5 doses of 200 milligrams zodasiran or placebo. The primary endpoint is the percent change from baseline to month 12 in fasting LDL cholesterol. Enrollment has been on track and we are confident that the study can be fully enrolled this year to enable study completion and potential NDA filings before the end of 2027.

The last program within cardiometabolic is ARO-DIMER-PA, the first dual functional siRNA designed to silence the expression of 2 genes with a single RNAi molecule. ARO-DIMER-PA is being developed as a potential treatment for ASCVD due to mixed hyperlipidemia by silencing expression of both PCSK9 and APOC3. In January, we initiated a Phase I/IIa placebo-controlled dose escalating study to evaluate the safety, tolerability, pharmacokinetics, pharmacodynamics and effects on LDL cholesterol and triglycerides using single-dose ARO-DIMER-PA in Part 1 and multiple doses in Part 2 in up to 78 adults with mixed hyperlipidemia.

Enrollment in the study has been rapid and we are on schedule to have sufficient data to provide the first clinical readout in Q3 of this year. This is a very interesting program, and we think the preclinical data has been highly compelling. We have some innovative ideas on late-stage trial designs and potentially that potentially accelerate the path to regulatory approval. So we are eager to have the first clinical readout to start moving ahead later studies if supported by initial data.

Lastly, I'd like to give an update on the status of the ARO-MAPT first-in-human study. ARO-MAPT is being developed as a potential treatment for tauopathies, including Alzheimer's disease, progressive neurodegenerative disease characterized by cognitive and functional decline. Alzheimer's disease is the most common cause of dementia affecting an estimated 32 million people worldwide and is part of a group of neurodegenerative diseases called tauopathies that are marked by abnormal tau accumulation and formation of tau tangles in neurons. Tau-related pathology may be a critical driver of neurodegeneration and targeting tau is a promising strategy to potentially slow or stop cognitive and functional decline.

ARO-MAPT is Arrowhead's first investigational RNAi-based therapy to achieve a new proprietary delivery system, which in preclinical studies has achieved blood-brain barrier penetration and deep knockdown of target genes across central -- across the central nervous system, including deep brain regions after subcutaneous injection. This underscores Arrowhead's leadership in the delivery of siRNA to multiple tissues and cell types throughout the body, utilizing our proprietary and differentiated targeted RNAi molecule or TRiM platform.

In December 2025, we dosed the first subjects in a Phase I/II clinical trial of ARO-MAPT. This study is a placebo-controlled dose escalating study to evaluate the safety, tolerability, pharmacokinetics and pharmacodynamics of ARO-MAPT in up to 64 healthy subjects and up to 48 patients with mild cognitive impairment due to Alzheimer's disease and mild Alzheimer's disease dementia. In Part 1a of the study, healthy subjects will receive 1 or 3 weekly doses of ARO-MAPT or placebo by subcutaneous injection. In Parts 1b and Part 2, healthy volunteers and Alzheimer's disease patients, respectively, will receive multiple escalating doses of ARO-MAPT or placebo.

We are nearing completion of enrollment of the single-dose portion of the study in healthy volunteers and have begun enrollment in the multi-dose cohorts in both healthy volunteers and patients with Alzheimer's disease. This keeps us on pace for an initial data readout at the end of Q3 or early Q4.

I will now turn the call over to Dan Apel.

Thank you, James, and good afternoon, everyone. As we reported today, net loss for the quarter ended March 31, 2026, was $132.7 million or a loss of $0.93 per share based on 142.4 million fully diluted weighted average shares outstanding. This compares to net income of $370.4 million or $2.75 per share for the quarter ended March 31, 2025, based on 134.5 million fully diluted weighted average shares outstanding in that quarter.

Recall that in the prior year quarter, we recorded over $540 million in revenue solely related to the Sarepta transaction that was executed at that time. Revenue for this quarter totaled $74 million, driven primarily by our license and collaboration agreements with Sarepta and with Novartis. Of this amount, approximately $42 million related to the Sarepta collaboration. This includes $28 million from ongoing recognition of the initial Sarepta consideration, $10 million related to reimbursement of incurred preclinical collaboration program costs and $4 million for our clinical supply provided to them under a clinical supply agreement.

In addition, we recognized $20 million of the $200 million upfront payment received from Novartis in October, bringing year-to-date recognition of Novartis upfront to $54 million, with the remaining $146 million to be deferred over time as we fulfill our preclinical obligations. We also recorded $11 million related to the asset purchase agreements between Sanofi and Visirna to develop and commercialize investigational plozasiran in Greater China. Visirna, as you know, is our majority-owned subsidiary with operations in China and the amount recognized is almost entirely due to the January approval of FCS in that region by the Chinese National Medical Products Administration.

As mentioned previously, we are not intending to headline specific REDEMPLO product sales numbers until such time as they become a meaningful driver to our financials. That said, net sales can be derived from our disclosures as the difference between total net revenue and collaboration revenue and represents approximately $1 million for the quarter. This is our first full quarter of REDEMPLO sales. And on a unit basis, that figure compares favorably to the first full commercial quarter of the other approved APOC3 inhibitor.

Turning now to expenses. Total operating expenses for the quarter were approximately $215 million, roughly flat with operating expenses in the first fiscal quarter. This compares to $162 million in the prior year quarter, representing an increase of $53 million year-over-year. This increase was driven by $40 million of higher R&D expenses and $13 million of higher SG&A expenses, fully in line with our expectations. The increase in R&D expense was primarily attributable to ongoing progression of our Phase III registrational studies for plozasiran in SHTG as well as our early-stage pipeline programs, including the dimer and MAPT.

Fiscal year-to-date, almost 2/3 of the clinical trial spend can be attributed to our plozasiran Phase III studies. As James already mentioned, the registration of SHTG studies for plozasiran should readout in the summer and clinical trial spend for these programs should thereafter moderate accordingly.

SG&A expenses increased year-over-year compared to the prior year second fiscal quarter, driven primarily by ongoing investments to support the commercialization of REDEMPLO. As previously discussed, we are continuing to build our commercial capabilities to fully support the FCS launch. We continue to leverage and invest in these capabilities to support REDEMPLO and FCS while also positioning the organization to support a potential future launch in SHTG. And we ultimately expect to leverage these same capabilities for the advancement of zodasiran for the treatment of HoFH.

Turning to the balance sheet. Cash and investments on hand totaled nearly $1.8 billion as of March 31, 2026. Common shares outstanding at quarter end were 140.6 million. To provide a little color, in this quarter alone, we brought in over $1 billion, including approximately $850 million net from our January financing transactions, inclusive of a concurrent offering of 0% convertible senior notes and common stock, along with the associated capped call transaction.

Other notable inflows in the quarter include the $200 million received from Sarepta upon achieving the second DM1 program milestone as well as the $50 million anniversary payment under the Sarepta long-term collaboration agreement. All of this is very much in line with the information provided previously during our February earnings call. We believe our strong balance sheet provides us with significant financial flexibility to support ongoing clinical development to advance current and future commercialization activities and to execute against our long-term strategic priorities.

With that brief overview, I will now turn the call back to Chris.

Thanks, Dan. As we build out our commercial team and focus on efficiently bringing REDEMPLO to patients who need it, we have not lost sight on continuing to expand our pipeline and ultimately increasing the number of medicines we can offer to a wide variety of patients. Our business has become more complex as we grow in all of these areas, where we continue to innovate and execute well. We see multiple key potential value-creating events in the second half of 2026 that together speak to our priorities.

Here are just a few of the events we are tracking. SHASTA-3, SHASTA-4 and MURI-3, which is a suite of Phase III clinical studies designed to support an sNDA for REDEMPLO in patients with SHTG is on schedule for completion and top line readout in Q3. The first clinical readout of ARO-DIMER-PA targeting both PCSK9 and APOC3 for LDL and TG lowering is also expected in Q3. The first clinical readout for ARO-MAPT is expected around the end of Q3 or early Q4. It is being developed as a potential treatment for tauopathies, including Alzheimer's disease and is our first program using the CNS delivery platform designed to cross the blood-brain barrier after systemic delivery via subcutaneous administration.

Additional ARO-INHBE and ARO-ALK7 data releases are planned in 2026 for this novel non-incretin strategy, which had quite encouraging early data, particularly in diabetic obese patients in combination with tirzepatide and with liver fat reductions as monotherapy or in combination with tirzepatide. As James mentioned, we are planning to webcast 3 presentations as part of our summer series of R&D webinars to go over cardiometabolic broadly, obesity and ARO-MAPT. These can serve as a review of the programs and results to date and as a primer for the potentially important readouts coming up later this year.

Thank you for joining us today. I would now like to open the call to your questions.

At this time we will now conduct the question-and-answer session. [Operator Instructions] Our first question comes from the line of Edward Tenthoff from Piper Sandler.

My question really has to do with looking at the upcoming SH, severe hypertriglyceridemia readout. When it comes to pancreatitis as a secondary, is the plan to pool SHASTA-3 and 4? And what are sort of the assumptions around pancreatitis?

Yes, Ted, thanks for the question. This is James. Yes, you've got that right. The plan is to pool both of those studies, SHASTA-3 and -4, and we'll analyze meta-analysis of those 2 studies to look at pancreatitis event rates, both rates of events in individual patients and a total number of overall events. I think that's kind of all I can say on that. We're still blinded. And like we said, should have the data in Q3.

Great. Looking forward to that.

[Operator Instructions] Our next question comes from Jason Gerberry of Bank of America.

I just wanted to probe in a little bit more on the INHBE and ALK 7 updates later this year and get your latest thoughts on these modalities and think investors have soured a little bit on INHBE after the WAVE data update. So just wanted to get your perspective on kind of what you need to see from these upcoming readouts to advance one or both for obesity treatment versus any alternative potentially considering for a NASH indication.

Jason, this is James. Sure. Happy to cover those questions. We've been saying all along really that we thought that this INHBE ALK 7 access is interesting, but we thought the approach was to combine with GLP-1s. And that is still our standpoint here. We think that there's potential, particularly in the type 2 diabetics for additional weight loss on top of tirzepatide or other GLP-1s with either ALK 7 knockdown or INHBE knockdown.

What we've seen from the clinical study that we talked about earlier this year from INHBE -- with INHBE knockdown is really clear redistribution of fat out of the liver, even with monotherapy, but also with combination therapy and some additional changes and improvements in body composition and reductions in total fat and visceral fat, particularly in that type 2 diabetic population. So I think we look forward to more of the same and sharing more of that liver fat data here in the coming quarter or so and then in the second half of the year, providing some additional updates on the changes in body composition and some of the other parameters that we showed back in January.

Our next question comes from Brian Cheng of JPMorgan.

This is Ron on for Brian. Congrats on the quarter. Just wanted to ask you, can you guys give more color on the interactions you've had with payers that led to the recent price lowering? And what has been the feedback since your competitive action last month?

Ron, this is Andy. So our interactions with payers to date have been consistent, have been positive, and we're seeing payer policies, and these are public payer policies that reflect the ability to diagnose FCS patients through multiple diagnosis pathways, in particular, through the clinical criteria that we saw in PALISADE. So really, really positive conversations with payers about payer policies and about future coverage.

Okay. And just a quick follow-up. Could you guys how should we think about the impact here to gross to net following the price lowering?

Well, gross to net. And Dan will take that. What's our assumption on gross to net with the new pricing policy?

Yes. So we -- I mean, we -- I'll just answer your second question, with more in line to -- as Chris already explained, to make a premium price to the competitor there. We are -- I'm not actually going to give guidance on gross to net. We have not seen anything substantial in that regard nor do we currently expect that other than things that are statutory required such as Medicaid rebates and the manufacture discount program and the like. So -- but we have a policy not to provide any sort of guidance or -- on that at this stage.

And let's just be clear, the lowering of the WAC from $60,000 to $45,000 had nothing to do with any pushback from the payers. To the contrary, I think that those interactions have been quite positive. This is a lowering of the WAC in expectation of an expectation of, of an expansion the market into SHTG and to ensure that we are -- that we would -- the payers would not require a step through with our competitor.

As we talked about, we are priced at a premium here. We think that's appropriate given the characteristics of our drug versus the competitors' drug. And we think $45,000 actually long term is probably quite a good price in terms of maximizing access to the drug across various subpopulations within SHTG.

[Operator Instructions] Our next question comes from Mike Ols from Morgan Stanley.

This is Avi Novick on for Mike. Congrats on the quarter. I guess among the patients who were switchers, could you characterize, I guess, the motivations for switching to REDEMPLO? Was it due to its clinical profile? Or could it be more payer related?

Mike, this is Andy. Thanks for the question. We've seen really diversity of reasons for switch that include efficacy, safety and tolerability and a variety of other reasons as well. So I wouldn't say there's one particular reason driving switch. There's a multitude of reasons.

[Operator Instructions] Our next question comes from Maury Raycroft from Jefferies.

Maybe just a follow-up to Ted's question earlier on SHASTA-3 and -4. Just wondering if there's an updated perspective on whether the blinded AP event rates are tracking in line with your expectations and whether you'd be able to generate enough events by the time the study completes? Or could you potentially even keep the study blinded a little bit longer to get an adequate number of total events?

Maury, this is James. I'll take that question. So we're not giving any guidance on or sort of blow-by-blow details on the number of events we're seeing. Suffice it to say, we feel comfortable with the number of events we have seen and the big reveal will be in Q3. But no plans to extend the study or stay blinded for a longer period at this time.

[Operator Instructions] Our next question comes from Mani Foroohar from Leerink.

You have [ Val ] for Mani. Congrats on the quarter. So yes, can you talk about how the Phase III data from Biogen will inform the strategy for ARO-MAPT? And maybe also can you just comment on your internal expectations for this readout?

I don't think any of us caught that. Could you say that again? I think the line is a bit muddled.

Sorry. No, yes, I was asking if you could talk about the Phase III SLE data from Biogen and how it will inform your strategy for ARO-MAPT and can you also talk about internal expectations?

Sure. Yes, I can take that. This is James. So the -- I'm assuming you're referring to the ASO starting MAPT from Biogen and Ionis that's supposed to readout here in maybe this quarter or early next quarter. Yes, I mean, I hope those data look good, and I hope that they show an improvement in the cognitive rating scales. I think that would be broadly positive for Arrowhead and for the tau hypothesis in general. Of course, that study is in Alzheimer's disease. and a positive readout would support our Alzheimer's programs.

That being said, even if those data are not positive, I think we can still -- we still have the option of pursuing all the other tauopathies, right, because the knockdown approach of tau should improve any condition that's really driven by tau gain of function or tau pathology. So things like progressive supranuclear palsy or corticobasal dementia or some of the real specific MAPT gain of function frontotemporal dementia disorders. Those are all fair game for us as we think about Phase IIs and Phase III down the road. So hopefully, the Biogen data are positive. If it's not -- it's not the end of the world for our program because we can still pursue the tauopathies.

[Operator Instructions] Our next question comes from Joseph Thome from TD Cowen.

Just as we're thinking about the potential outcomes for the SHASTA-3, -4 studies later this year, do you expect that you'll have to show differentiated efficacy versus what Ionis has shown in addition to the dosing benefit in order to keep that even slightly premium pricing? And then just a point of clarification, are you characterizing the AP events in SHASTA-3, -4 the same way that you characterized them in the long-term of SHASTA-2 extension that was recently presented?

Why don't I take the second part first about the characterization. The answer is no. So the SHASTA-2 study, we used the strict Atlanta criteria to look at pancreatitis events, whereas in the SHASA-3, -4 pooled analysis, we're using this to modify the Atlanta criteria that has definite probable and possible pancreatitis. And regarding the premium pricing, let's just see what those data look like.

Historically, when we look at data side by side with the large caveat, of course, it's difficult to compare different clinical studies with different patient populations. What we have seen consistently is superior triglyceride reduction, superior safety profile and of course, superior convenience. We expect those to continue. And should that be the case, then we would expect that a premium is still appropriate.

Our next question comes from Patrick Trucchio of H.C. Wainwright.

Just regarding your business development strategy, I was hoping you could give us some additional detail just in terms of which assets you would be looking to bring forward on your own versus those that you may partner? And then just more broadly, how you're thinking about how RNAi kind of fits into the broader genetic medicines sort of portfolio and how RNAi is looking sort of competitively against modalities like gene editing, et cetera?

Sure. Look, I think that RNAi is at the forefront of genetic medicine for the foreseeable future. Now look, it's not the right modality for everything. But for those diseases that are characterized by the overproduction of something, if we can address that cell type, then RNAi is a very attractive modality. But when we think about RNAi versus gene editing, the way I feel at least is that RNAi is a relatively straightforward and conservative approach, right? It is a reversible approach.

And in our hands, we can have very long durability space. So you can almost get the best of both worlds where you have a low needle burden, if you will, but the ability to come off drug should some new biology come out to suggest that you don't actually want to knock down that gene product. That's not the case in gene editing.

And I think that gene editing does have a place in the world of medicine. It's just quite unknown right now because I don't know what happens to these edited genes 10 years from now. I don't think anybody does, notwithstanding as the biology changes and it could be that sometime in the future, we decide that they might not want to knock down a certain gene product. So for those horrible diseases that are terminal, it could be worth taking a risk to do gene editing. But frankly, for all others, if you can address something with RNAi, that feels to me a better approach.

Regarding to the development, this is a dynamic question. Right now, we feel pretty good about our existing pipeline in terms of that, which is wholly owned right now. We like the idea of pushing all these forward ourselves with the possible exception of C3 and Factor B, we like those programs a lot. Those drug candidates appear to do what they're intended to do and they seem to be well tolerated. Those are just really outside of our core focus at present. And so those are a couple of assets that we could partner with the right partner at some point. Everything else feels pretty good right now. Look, that may change as we talk to other companies and as our pipeline grows, but we don't feel a real sense of urgency to do additional deals on existing clinical programs other than maybe C3 and Factor B.

Our next question comes from Amine Chaherli from B. Riley Securities.

Congratulations on the quarter. This is Amine Chaherli on behalf of Madison El-Saadi. I just wanted to ask, as you think about the next generation of the dimer platform, is a construct combining INHBE or ALK 7 with a nonoverlapping mechanism target, something you're evaluating for obesity or other indications?

Yes.

Can we move on to next question.

Yes. Our next question comes from Luca Issi from RBC Capital Markets.

This is Shelby on for Luca. Given Ionis has announced a new price at $40,000 and have first-mover advantage, can you walk us through the rationale to continue to price for REDEMPLO at a premium versus Zeptar in SHTG maybe as a way to kind of undercut their pricing since you're coming in second. Just wondering the rationale behind that.

Yes. Thanks, Shelby. As Chris previously mentioned, we do believe REDEMPLO is a best-in-class APOC3 inhibitor and that it commands premium pricing as a consequence of that. And there are a variety of reasons for that. Chris touched on some of them, including the depth of knockdown for APOC3 as a target, the depth of TG reduction. We saw that from PALISADE with an 80% reduction from baseline.

We saw that with the numerical decrease in acute pancreatitis from PALISADE. We've seen that also with an FDA label that has no contraindications, no warnings and no precautions. And then lastly, with a convenient dosing schedule that's only 4 injections a year. When you sum up the totality of those attributes, we just believe it's a best-in-class APOC3 inhibitor and as a consequence, should be premium priced.

Our next call -- our next question comes from Jen Jia from Cantor Fitzgerald.

This is Jennifer Jia on for Prakhar Agrawal. I'd like to understand a little bit more on the expectations for ARO-DIMER readout later this year. So what efficacy are you hoping to see? And what does it take to take this forward to a larger trial? And if it's positive, do you consider going straight to a cardio outcomes trial? Or will you still need to complete a Phase II?

Yes, Jennifer, this is James. Happy to address that question. So the great thing about this program is that all of the relevant biomarkers and even biomarkers that you could use for potentially for approval are blood-based, right? We can measure CSTK-09, we can measure APOC3 in the blood, and we can measure LDL cholesterol and triglycerides, Apo B, non-HDL cholesterol are all pretty easy for us to measure. So that's what we'll be primarily focused on as well as safety in this initial data readout.

In terms of where we go from here, I think we're working on that now. There may be some additional limited Phase II work, which we could even consider doing as part of this study, but then moving quickly into an outcome study down the road. So more to come on the development plan and the study designs, but looking forward to the readout later this year.

Our next question comes from Keay Nakae from Chardan Capital Markets.

A question about the Madrigal license agreement for PNPLA. Help us understand from a capital allocation strategy perspective, why it makes sense for you to do this deal at this time as opposed to taking the drug further on your own?

Yes, good question. So let me just take it back and remind everyone that where ARO- PNPLA3 came from. We didn't develop this on our own independently. This is part of our deal with Janssen that was centered around [ HBV FSP ], but also included a couple of additional targets. This was one of those targets. And so we developed it for them. They did the Phase I. The Phase I was compelling. After only a single dose, they saw about a 40% reduction in liver fat in homozygous patients. So that was interesting to us. Janssen, as I understand, decided to get out of NASH. And so the asset was returned to us. We didn't spend any money on this.

As we look at taking this forward, we think it's a really compelling target for a company that's focused in NASH largely. This is a genetically defined population. And that's sort of the good news and the bad news, right? The good news is it's quite specific. The challenge there is that there will be a companion diagnostic component to this. And it made sense for us to find a pure-play NASH company to take this forward. And of course, Madrigal is, I think, the best that's out there right now. It doesn't make sense. It didn't really make sense for us to spend much money right now to do a Phase II.

Those studies could be a bit long and more expensive than made sense for us. We've got a very large pipeline. We've got some really interesting programs that we are pushing ourselves. And I just think that our ROI is probably better by allocating capital to those programs that we are more confident that we will hold on to long term. So that's where we went. We are thrilled to have Madrigal as a partner. We're thrilled to have them develop that drug. It's a good drug, and we're thrilled to have them commercialize eventually. So we feel good about the deal.

This concludes the question-and-answer session. I would now like to turn it back to Chris Anzalone for closing remarks.

Thanks, everyone, for joining us today. We look forward to seeing you in the future.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals Conference Call. [Operator Instructions] I will now hand the conference over to Vince Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.

Thank you, Victor. Good afternoon, and thank you for joining us today to discuss Arrowhead's results for its fiscal 2026 first quarter ended December 31, 2025.

With us today from management are President and CEO, Dr. Chris Anzalone, who will provide an overview; Andy Davis, Senior Vice President and Head of the Global Cardiometabolic Franchise, who will provide an update on commercialization activities; Dr. James Hamilton, Chief Medical Officer and Head of R&D, who will discuss our development programs; and Dan Apel, Chief Financial Officer, who will give a review of the financials. Following management's prepared remarks, we will open the call to questions.

Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact are forward-looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statements.

For further details concerning these risks and uncertainties, please refer to our SEC filings, including our most recent annual report on Form 10-K and our quarterly reports on Form 10-Q.

I'd now like to turn the call over to Chris Anzalone, President and CEO of the company. Chris?

Thanks, Vince. Good afternoon, everyone, and thank you for joining us today. We had another quarter of strong execution across all areas of our business, and we are well positioned to build on this progress throughout 2026 and beyond. In fact, the recent months have included some of the more significant achievements in Arrowhead's history. Let's talk about some of these.

First, on November 18, 2025, Arrowhead received its first regulatory approval and began the next phase of growth as a commercial company marketing its own medicines. The FDA approved REDEMPLO as an adjunct to diet to reduce triglycerides in adults with familial chylomicronemia syndrome, or FCS.

FCS is a severe rare disease with an estimated 6,500 people in the U.S. living with genetic or clinical FCS, characterized by TG levels that can be 10 to 100x higher than normal, leading to a substantially higher risk of developing acute recurrent and potentially fatal pancreatitis.

This approval was supported by clinical data from the Phase III PALISADE study in adults with either clinically diagnosed or genetically confirmed FCS. The PALISADE study demonstrated deep and durable reductions in TGs with a median reduction of 80% from baseline and a lower numerical incidence of acute pancreatitis events compared to placebo.

Arrowhead launched REDEMPLO independently in the U.S. with the One-REDEMPLO pricing model that creates one consistent price across current and potential future indications. This is important. We're committed to sustainable innovation, and this requires a rational drug pricing according to the value a medicine offers to patients and health care systems. REDEMPLO is a pancreatitis drug. And when we think about pricing, we look to those patient populations at greatest risk of acute TG-related pancreatitis.

We've only had drug in channel for about 10 weeks, which included Thanksgiving, Christmas and New Year's holidays. So it is difficult to infer too much about launch. However, initial trends in prescription payer interactions and shipments have been encouraging. To date, over 100 prescriptions for REDEMPLO have been received from a diverse prescriber base with geographically balanced uptake across the U.S.

Early patient starts fall into 3 categories: patients transitioning from our expanded access program, patients naive to the APOC3 class and patients switching from olezarsen. In addition, REDEMPLO shipments are being made for patients with clinically diagnosed and genetically confirmed FCS.

In addition to FDA approval, we announced in January 2026 that REDEMPLO also received approval for the treatment of FCS from Health Canada and from the Chinese National Medical Products Administration. REDEMPLO will be available later this year in Canada, and we anticipate it will be marketed independently by Arrowhead.

Pending regulatory review and approval, we expect to potentially launch REDEMPLO later this year in select EU countries and in the U.K. In Greater China, REDEMPLO will be marketed by Sanofi.

Our cardiometabolic pipeline is off to a good start with REDEMPLO and the ongoing Phase III study of zodasiran in homozygous familial hypercholesterolemia, or HoFH. We are actively expanding this pipeline with a number of discovery programs and importantly, 3 clinical programs. ARO-INHBE and ARO-ALK7 being developed as potential treatments for obesity are in Phase I/II studies. We also recently initiated a Phase I/II study of ARO-DIMER-PA in patients with mixed hyperlipidemia.

For our initial obesity candidates, we recently announced some early interim clinical data. ARO-INHBE enhanced weight loss and fat reduction versus tirzepatide alone in obese patients with type 2 diabetes.

More specifically, 2 administrations of ARO-INHBE at the 400-milligram dose in combination with tirzepatide achieved approximately twofold better weight loss at week 16 than tirzepatide alone. This appears to be a high-quality weight loss as we saw an approximately threefold reduction in each of total fat, visceral fat and liver fat measures based on week 12 MRI versus tirzepatide alone in these patients.

ARO-ALK7 Phase I/II study is approximately 2 quarters behind the ARO-INHBE study, but early data are encouraging. We believe this is the first RNAi therapeutic to show a adipocyte gene target silencing in the clinical trial, and we've seen dose-dependent reductions in adipose ALK7 mRNA with a mean reduction of minus 88% at the 200-milligram dose at week 8 and a maximum reduction of minus 94%.

While these are very intriguing data, they are early and incomplete. So we have substantial work ahead of us before we get too excited about how these candidates could eventually be used. We will continue to run both Phase I/II studies. We are expanding existing cohorts to increase power, and we are adding new cohorts to better understand these candidates and underlying biology. We intend to report additional results later in 2026.

ARO-DIMER-PA is being developed as a potential treatment for atherosclerotic cardiovascular disease, or ASCVD, due to mixed hyperlipidemia, where both LDL cholesterol and triglycerides are elevated. We believe there are approximately 20 million people in the U.S. with mixed hyperlipidemia, and this is a patient population without adequate treatment options.

We recently announced that we dosed the first patients in the Phase I/II clinical trial of ARO-DIMER-PA, which is a dual functional RNAi therapeutic designed to silence expression of the PCSK9 and APOC3 genes, thus designed to reduce both LDL cholesterol and TGs.

This represents an important step forward for the RNAi field as we believe it is the first clinical candidate to target 2 genes simultaneously in 1 molecule and an important step forward for preventative cardiology as both LDL and TGs have epidemiologic support as being important drivers for ASCVD risk.

We expect to have interim data for ARO-DIMER-PA in the second half of 2026. If we see good LDL and TG reduction in a well-tolerated manner, we may have something truly special for a very large and currently underserved patient population.

Outside of cardiometabolic, we made important advances in our CNS portfolio, specifically in programs that utilize a new proprietary delivery system designed to achieve blood-brain barrier, or BBB, penetration, utilizing subcutaneous administration.

In nonclinical studies across multiple animal models, we saw deep target gene knockdown across the CNS, including deep brain regions. This underscores Arrowhead's leadership in the delivery of siRNA to multiple tissues and cell types throughout the body, utilizing the proprietary TRiM platform.

Our first wholly owned program using the BBB platform is ARO-MAPT, being developed as a potential treatment for tauopathies, including Alzheimer's disease. During the last quarter, we announced that we dosed the first subjects in a Phase I/II clinical trial that will include healthy volunteers and Alzheimer's patients.

ARO-MAPT targets the tau protein in the brain, which has good biological validation as a potential driver of pathology and has emerged as a promising target for Alzheimer's disease and additional tauopathies. We anticipate interim clinical data from the healthy volunteer portion of the study should be available in 2026, with data from the Alzheimer's patients to follow in 2027. This is a very exciting program for us.

The second program to use our BBB delivery system is SRP-1005, formerly called ARO-HTT for the treatment of Huntington's disease. This program is partnered with Sarepta, which recently announced the submission of its CTA for study SRP-1005-101, also known as INSIGHTT, in approximately 24 participants.

While our cardiometabolic and CNS work by no means encompasses everything we are doing, they are areas of substantial focus and potential value drivers in the near, mid and long term. Within these areas, we are addressing three of the greatest public health challenges of our time, obesity, cardiovascular disease and neurodegenerative conditions.

Now I'd like to move on to some key events during the recent period that have dramatically strengthened our balance sheet and give us the necessary resources to push multiple programs toward commercialization.

We anticipate being funded through multiple potential independent and partner launches. These meaningfully increase revenue opportunities for the company and push us toward becoming cash flow positive and self-sustaining from commercial sales. Since our last reporting period, we have completed transactions with gross proceeds of $1.33 billion. Let's break that down.

First, we completed a global licensing and collaboration agreement with Novartis for ARO-SNCA, Arrowhead's preclinical stage siRNA therapy against alpha-synuclein for the treatment of synucleinopathies such as Parkinson's disease.

The collaboration includes a limited number of additional targets outside our pipeline that will utilize Arrowhead's proprietary TRiM platform. Arrowhead received a $200 million upfront payment and is also eligible to receive development, regulatory and sales milestone payments of up to $2 billion. Arrowhead is further eligible to receive tiered royalties on commercial sales up to low double digits.

Second, we earned $200 million milestone payment from Sarepta following a drug safety committee review and subsequent authorization to dose escalate and achievement of the second prespecified patient enrollment target for ARO-DM1.

And third, we closed concurrent public offerings of $700 million aggregate principal amount of 0% coupon convertible senior notes and $230 million of common stock. Both offerings were several times oversubscribed and priced at company-friendly terms.

As I mentioned at the beginning of the call, we demonstrated strong execution across all areas of our business. We received regulatory approval in 3 different countries. We launched our first commercial product. We continue to grow our cardiometabolic portfolio. We had encouraging early results from our obesity programs.

We advanced our TRiM platform and CNS pipeline, and we meaningfully improved our financial position to push these and other programs forward. It has been a productive last few months at Arrowhead with so much potential to continue the strong progress in 2026 and beyond.

With that overview, I'd now like to turn the call over to Andy Davis. Andy?

Thank you, Chris, and good afternoon, everyone. It has been just over 2 months since the approval of REDEMPLO on November 18, 2025, and we are very pleased with the progress we are seeing. I'd like to share some early insights across health care provider engagement, patient dynamics and payer developments.

I'll start with health care provider engagement. As a reminder, we are targeting approximately 5,000 health care professionals through personal promotions, complemented by a much broader omnichannel effort. Early prescribing has been led by preventive cardiologists and endocrinologists, who together account for approximately 70% of total prescriptions, with the remainder coming from internal medicine physicians focused on lipid disorders.

In addition, advanced practice providers, including nurse practitioners and physician associates working within multidisciplinary care teams; are playing a meaningful role in patient identification and treatment decisions.

Turning to patient dynamics. As Chris mentioned, over 100 prescriptions for REDEMPLO have been received to date. We see this as a very strong start that exceeded our expectations for the early months of the launch. We are also seeing geographically balanced uptake across the United States. Early patient starts fall into 3 categories: patients transitioning from our expanded access program, patients naive to the APOC3 class and patients switching from olezarsen.

Class-naive patients represent the overwhelming majority of starts with expanded access and switch patients contributing evenly to the remainder. Patients receiving REDEMPLO include both clinically diagnosed and genetically confirmed FCS, with the majority not required to submit genetic testing to gain access. Importantly, a high proportion of patients are enrolling in the rely on REDEMPLO patient support program. And in the fiscal first quarter, patients eligible for co-pay assistance paid $0 out of pocket.

Next, I'll touch on payer developments. While it is still early, we remain encouraged by positive payer feedback on both the clinical profile of REDEMPLO and our unified One-REDEMPLO pricing approach. We are actively engaged with the largest payers and discussions to date reflect a willingness to cover REDEMPLO to label, including access based on either genetic or clinical diagnosis of FCS.

I'd like to conclude with a brief comment on execution. Within days of FDA approval, we had product available in the channel for FCS patients. Our REDEMPLO care coordinators, rare disease specialists and field reimbursement navigators were deployed on day 1 to support prescribers and patients, and our payer account team continues to work closely with customers to minimize access barriers.

The teams are off to a great start. And our teams are highly encouraged by early stakeholder feedback. This feedback further reinforces the key differentiating attributes of REDEMPLO.

As a reminder, in the PALISADE study, REDEMPLO reduced triglycerides by 80% from baseline as early as month 1 and maintained this reduction with minimal variability through 12 months of treatment.

In addition, the numerical incidence of acute pancreatitis was lower in REDEMPLO-treated patients than in placebo. And the U.S. approved prescribing information includes no contraindications, no warnings and no precautions. And REDEMPLO can be self-administered at home once every 3 months, just 4 injections per year.

With that, I'll turn the call over to James Hamilton to discuss the R&D portfolio.

Thank you, Andy. I'd like to start with a review of the REDEMPLO FDA approval and information in the label and contained in the package insert.

REDEMPLO is approved as an adjunct to diet to reduce triglycerides in adults with FCS. The recommended dose of REDEMPLO is 25 milligrams, and it can be self-administered at home by subcutaneous injection once every 3 months. REDEMPLO has no contraindications, warnings or precautions in the U.S. FDA-approved label. The most common adverse reaction includes hyperglycemia, headache, nausea and injection site reactions.

REDEMPLO was studied in patients with both genetic FCS and clinically diagnosed FCS in the Phase III PALISADE study. Patients achieved deep and durable reductions in median triglycerides of around 80% from baseline with reductions largely maintained below the guideline directed threshold of 500 milligrams per deciliter throughout the year of treatment.

Importantly, patients with genetic FCS versus clinical FCS showed similar reductions from baseline. We see the clinical FCS population as having the same high unmet need as the genetic FCS group. And as such, we think it's crucial to have shown that both patient populations showed similar large reduction from baseline in triglycerides.

In PALISADE, treated patients also had a reduced rate of adjudicated acute pancreatitis events, a very welcome finding for FCS patients and their caregivers and an important validation that reduction in triglycerides can, in fact, lead to reductions in pancreatitis.

In addition to FCS, we are also investigating plozasiran in patients with severe hypertriglyceridemia or SHTG. We announced last quarter that the FDA granted breakthrough therapy designation to investigational plozasiran as an adjunct to diet to reduce triglycerides in adults with SHTG.

Breakthrough therapy designation is a process designed to expedite the development and review of drugs that are intended to treat a serious condition and where preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over available therapies on clinically significant endpoints. This is another important step for the program.

The global Phase III studies of plozasiran designed to support the supplemental NDA filing to expand the label beyond genetic and clinical FCS are the SHASTA-3 and SHASTA-4 studies, which enrolled approximately 750 patients; and MUIR-3, which enrolled 1,400 patients. We're also enrolling patients in SHASTA-5 to directly assess the ability of plozasiran to reduce the risk of acute pancreatitis as the primary endpoint.

We remain on schedule to complete the blinded portion of the SHASTA-3, SHASTA-4 and MUIR-3 Phase III clinical studies in mid-2026. We expect top line data to be available in the third quarter of 2026 with planned sNDA submission for SHTG before the end of the year.

We presented the study design and baseline characteristics of the SHASTA-3 and SHASTA-4 studies at the 23rd World Congress Insulin Resistance, Diabetes and Cardiovascular Disease in December 2025. I'd like to spend a moment to go over a few key parts of that poster.

The primary endpoint of the SHASTA studies and the accepted regulatory endpoint is TG lowering versus placebo. Plozasiran has been highly active in all patient populations studied. So these studies are overpowered to show TG lowering. One of the additional objectives and key secondary endpoints of SHASTA-3 and SHASTA-4 studies includes the assessment of acute pancreatitis rates.

To be clear, the study was not designed or prospectively powered to demonstrate AP rate reduction after just a near treatment. However, there are a meaningful number of SHTG patients enrolled that would be considered at high risk for AP. Specifically, among the 2 studies, which will be pooled for AP event assessment; 37% of enrolled patients reported TGs greater than 880 milligrams per deciliter, an accepted high-risk threshold for AP. In addition, 20% of enrolled patients had a prior medical history of pancreatitis.

Lastly, we are seeing AP events in the studies. We are, of course, still blinded and have about another 4 months before the last patient reaches the end of the blinded period, but overall, the studies are progressing as planned.

Chris mentioned the interim obesity results from our ARO-INHBE and ARO-ALK7 programs earlier, but I'd like to add some color and talk about what we are adding to these programs.

First, these early results were very encouraging. The next steps would be to investigate whether and where there is a therapeutic benefit and in the patient segments and treatment settings where it may be applicable.

To review, the interim clinical trial results represent the first demonstration in humans that the Activin E/ALK7 pathway, a genetically validated pathway that regulates adipose fat storage, may potentially be harnessed therapeutically to improve body composition and enhance weight loss versus tirzepatide treatment alone in obese patients with type 2 diabetes mellitus.

This patient population typically experiences less weight loss with incretin therapy. They're less likely to reach weight loss targets and need more effective treatment options. Importantly, ARO-INHBE in combination with tirzepatide achieved approximately twofold weight loss and approximately threefold reduction in visceral fat, total fat and liver fat versus tirzepatide alone in obese diabetics.

We saw signals that the pathway was active in the nondiabetics as well. But based on early data, the diabetic signal, particularly in combination with tirzepatide; appeared to be the clearest.

We are planning -- we are already in the planning and execution stage of the following next steps. increasing numbers of patients in the Phase I diabetic cohorts, including longer follow-up and better -- to better understand drug durability and activity out to 1 year; and initiating monotherapy cohorts in obese diabetic patients. We expect to have more data later in 2026 from these programs as we see data from the new expanded scope of the Phase I/II studies.

I will now turn the call over to Dan Apel.

Thank you, James, and good afternoon, everyone. I'll provide a brief outline of our financial picture.

As we reported today, net income for the quarter ended December 31, 2025, was $30.8 million or an income of $0.22 per share based on 140.7 million fully diluted weighted average shares outstanding. This compares to a net loss of $173.1 million or a loss of $1.39 per share for the quarter ended December 31, 2024, based on 124.8 million fully diluted weighted average shares outstanding at that time.

Revenue for the quarter totaled $264 million, driven primarily by our license and collaboration agreements with Sarepta and Novartis. Of this amount, approximately $229 million related to the Sarepta collaboration, and this included $181 million from the achievement of the second DM1 milestone, $32 million from the ongoing recognition of the initial Sarepta consideration and $17 million related to reimbursement of incurred collaboration program costs.

In addition, we recognized $34 million of the $200 million upfront payment we received from Novartis under our global licensing and collaboration agreement with them. The remainder of that $200 million will be deferred over time as we fulfill our preclinical collaboration obligations.

Finally, on revenue, we also recorded our first commercial sale of plozasiran in FCS. As both Chris and Andy have mentioned, we are very encouraged with the feedback and uptake we are seeing with patients and providers. For now, we are not disclosing specific sales numbers until such time as they become a meaningful driver to our financials.

Turning to expenses. Total operating expenses for the quarter were approximately $223 million compared to $164 million in the prior year quarter, representing an increase of $59 million year-over-year. This increase was driven by $40 million of higher R&D expenses and $19 million of higher SG&A expenses.

To break that down, the increase in R&D expense was primarily attributable to, as planned, higher clinical costs associated with our Phase III registrational studies for plozasiran in SHTG as well as increased clinical supply chain costs. Nearly half of our clinical trial spend in the quarter was associated with our 3 registrational SHTG studies, namely SHASTA-3, SHASTA-4 and MUIR; which again should read out in the summer.

SG&A expenses increased year-over-year compared to the prior year's fiscal first quarter, primarily driven by investments to support the commercialization of REDEMPLO. As previously discussed, in advance of the U.S. launch, we built robust commercial capabilities to fully support FCS and importantly, capabilities that were intentionally designed to be highly leverageable downstream should we obtain approval for plozasiran in SHTG and sulastiran in HoFH.

Turning now to the balance sheet. Cash and investments totaled $917 million as of December 31, 2025. Common shares outstanding at quarter end were 137.4 million. To be clear, the reported cash balance does not include the $200 million that we earned for the DM1 second milestone, which was received in January; nor does it include the $50 million anniversary payment that we expect to receive from Sarepta on or before February 10.

Finally, and importantly, the cash balance of $916 million also does not include the financing transactions announced in early January, consisting of a concurrent offering of convertible senior notes and common stock, along with associated capped call transactions.

As Chris mentioned, these were on company-friendly terms in the sense that the convertible was 0% coupon and the initial conversion premium was 35%. Said another way, the 0% coupon means the notes will not bear regular interest and the principal amount of the notes will not accrete.

The initial conversion price represents a significant premium of approximately 35% over the public offering price per share of common stock in the common stock offering. Moreover, the private cap calls will prevent any dilution to existing shareholders up to an 85% of the premium over the offering price or roughly $119. We estimate that the total cost of capital of that convertible at any share price below that $119 to be very attractively below 1.5%.

All that is to say that we have very significantly and efficiently strengthened our balance sheet, which provides additional flexibility to support ongoing clinical development, current and future commercialization activities and other long-term strategic priorities.

With that brief overview, I will now turn the call back to Chris.

Thanks, Dan. This is indeed an exciting time to be at Arrowhead or an Arrowhead shareholder. We're coming off a historic period for the company where we executed extremely well and all the hard work of the last several years is starting to pay off. While 2025 is productive, we look to the remainder of 2026 and the years ahead to be even more transformational.

Let's look at some key 2026 events that we anticipate could be important value-creating events for the company and our shareholders.

Commercial sales progress for REDEMPLO, Q3 2026 readout of Phase III SHASTA-3 and SHASTA-4 studies of plozasiran in patients with SHTG, which we believe has the potential to be a $3 billion to $4 billion commercial opportunity; second half 2026 readout for ARO-DIMER-PA targeting PCSK9 and APOC3 for LDL and TG lowering, which may address mixed hyperlipidemia, a population of potentially 20 million patients in the U.S.; additional ARO-INHBE and ARO-ALK7 data presented in 2026 that may build on the already encouraging early data for this novel non-incretin strategy; and early ARO-MAPT data in 2026, potentially providing validation for this drug candidate and our emerging CNS pipeline with systemic delivery via subcutaneous administration.

These are just a few potentially important events in 2026 alone. If you fast forward 1 to 3 years, we expect many more opportunities in our pipeline to build value and potential commercial launches, both independently and with partners.

Thank you for joining us today. And I would now like to open the call to your questions. Operator?

[Operator Instructions] Our first question will come from the line of Mike Ulz from Morgan Stanley.

Maybe just one on REDEMPLO. Can you just give a little bit more color on the breakdown between the different categories of patients transitioning from expanded access, naive and switch? And then maybe on the latter in terms of switch, just any key reasons you're seeing a switch? And does it have anything to do with coverage and pricing?

Thanks, Mike. This is Andy. Yes, I can comment that the vast majority of patient origination is from APOC3-naive segment, with the remaining balance split roughly 50-50 between those that are coming from switch and those that are transitioning off of the expanded access program. As it relates to switch, we're seeing switch patients that are coming both from efficacy, but also from safety as the two principal drivers for why physicians might be considering REDEMPLO as an alternative. I hope that helps.

Our next question comes from the line of Maury Raycroft from Jefferies.

Congrats on the progress. I'll ask one on obesity. Just wondering if you've had discussions with FDA about the development path or when would it make sense to do this? And what could timelines for your Phase II start look like? And do you need to have all the data, including combo data in hand, before you can determine next steps for the development path?

Yes, sure, Maury. I can take that. This is James. Probably middle of the year, we would be having some of those discussions with FDA. I don't think we need all of the data from all of the cohorts. As I mentioned in the prepared remarks, we expanded some of these cohorts, so they'll be going on some of them for a longer period of time. So FDA conversations probably middle of -- around middle of the year, and then we'll be looking to file an IND shortly thereafter.

Our next question will come from the line of Andrea Newkirk from Goldman Sachs.

Maybe I can ask you one here on the ARO-DIMER-PA asset. Just as we think about the data set that are -- that's coming later this year, just curious if you might be willing to speculate or share what you are looking for or how you've defined a TPP, what level of reduction in LDL-C and you're hoping to see? And then how that might inform a go/no-go decision for advancing the asset forward? And what extent of reduction would give you confidence that you could then see that translation to a benefit on MACE?

Yes, sure. We'll see. I think we probably don't have to reach the level of reduction in terms of APOC3 and triglycerides that we're seeing with plozasiran, for example. Something less than that with the combination of the LDL cholesterol reductions would probably be sufficient.

So I think if you look at some of the monkey data that we presented in the dyslipidemic monkeys, we were seeing reductions in LDL and in triglycerides of around 40%, 50%. So I think something like that, if you could do both of those, that would be really encouraging. But we'll see what the data show later this year.

Our next question comes from the line of Luca Issi from RBC Capital Markets.

This is Cathy on for Luca. Congrats on strong REDEMPLO launch and progresses. My question also on INHBE and ALK7 since we just talked about the regulatory path. Andy, I appreciate early days, but how are you thinking about potential pricing for INHBE and ALK7?

I mean Lilly now offers Zepbound via LillyDirect at $300 a month and the compounders announced today that you can get oral Wegovy basically at the same monthly price as YouTube TV. So what is your latest thinking on pricing? And how should we think about COGS for INHBE and ALK7?

It is -- as you expected, it's way too early for us to think about that. We're inherently in the biology here to see how these drug candidates could potentially work in various patient populations. Until we have a better understanding of that, it's really too early to speculate on potential pricing.

Our next question comes from the line of Prakhar Agrawal from Cantor.

Congrats on the quarter and the progress. So I think, James, you mentioned that about the Pancreatitis event rates in the ongoing Phase III SHASTA-3, 4 trials. Maybe if you can talk about the blinded AP events that you're seeing in those trials and whether it's in the same ballpark of what Ionis saw?

And just a follow-up to that, would you expect the placebo event rate on AP reduction to perform similarly to olezarsen core trials, given the population looks similar? Or are there any nuances that we should be aware of?

Yes. So on the first one, we're not going to give any additional details on event rates or the number of events that we've seen other than to say that we are seeing events.

On the second question, I mean, I think it's rational to look at the CORE and CORE2 placebo rate that the population was similar to ours. So they are obviously different studies, but the population was similar.

Our next question comes from the line of Jason Gerberry from Bank of America.

You mentioned payer feedback for REDEMPLO. I believe that was in the context of FCS. But I'm curious if in those discussions, SHTG came up at all and whether that price point that you guys have for FCS is appropriate for a market the size of SHTG and the likely benefits that APOC3 would provide. It seemed pretty derisked at this point, but just kind of curious if those discussions came up and how the view was on the $60,000 price point.

Thanks, Jason. This is Andy. I appreciate the question. I won't get into the details of any specific payer discussions, only to say that our team is laser-focused on ensuring we can gain coverage and access for those patients that have FCS, either genetically confirmed or clinically diagnosed.

I would just add that the payers with whom we're discussing represent over 90% of U.S. lives and both the clinical teams and the economic teams recognize the clinical value and the economic value of REDEMPLO at the One-REDEMPLO price that we've previously announced.

And you mentioned the size of the SHTG market. We think there are somewhere around 3.5 million people with triglycerides above 500. But that market is not all created equal. When we look at our -- at least initial target market there and we look at how we price REDEMPLO, it is really focused on those very high-risk individuals, those maybe 750,000 to maybe 1 million people who are -- who have triglycerides above 880 or history of pancreatitis.

That's -- at least initially, that is the real core market that those are the patients who really need this new medicine. So again, don't get lost in the 3 million to 4 million people with trigs above 500 really focus on that high risk group. That's what we're focusing on at least initially.

Our next question will come from the line of Patrick Trucchio from H.C. Wainwright.

My question is on ARO-MAPT. I'm just curious, with the interim data from the healthy volunteer portion and then with the patient data to follow, I'm wondering, what specific elements of the healthy volunteer data, safety, CSF tauopathies knockdown or downstream biomarkers would most likely increase your confidence in this program and as well the data we should look for in patients to follow?

And if you could also just talk about just the confidence this would give in the CNS targeting and platform overall and how we should expect the CNS platform to develop from here?

Yes, I can take that, Patrick. This is James. So maybe I'll take the second question first. We don't have any data in the clinic yet, any data in humans, but we do have data using the platform with multiple different targets in multiple different monkey studies, and they're pretty consistent in terms of the drug concentration that we get in various CNS regions and the knockdown we're able to achieve in the deep brain.

So that is helpful and certainly enhances our confidence. But of course, the large leap in confidence will come once we see the clinical data.

And to your first question, I think the key data that we anticipate being confidence building, of course, safety and then the CSF knockdown will be key in the healthy volunteers. There's not a lot of other downstream biomarkers to measure in the healthy volunteers. But then going forward into the patient cohorts, we can measure some of the [ phospho ] tauopathies varieties in the blood, also in the CSF.

And then, of course, we can look at tau PET, although those readouts will take a while to see the tau PET signals in the patients. I think seeing a reduction in tau PET signal will be really very encouraging.

The next question will come from the line of Edward Tenthoff from Piper Sandler.

So thanks for all the detail. Really exciting to see the pipeline advancing. I'm wondering when it comes to the recognition of revenues, at this point, are you guys anticipating breaking out a cost-of-goods-sold line? I'm sure a lot of the manufacturing expense has already been expensed to R&D. But I'm just trying to think about how you're planning on reporting COGS going forward? And will you break out REDEMPLO product sales in the future?

Yes. Thanks, Ted. Thanks for the question. Yes. As you pointed out, the cost of goods sold prior to launch are going to be in the R&D, and that's the majority of what we're going to see in the short term.

We said in the prepared remarks, we're not going to disclose this actively until such time as they are meaningful drivers. So we will, at some point, I'm not going to hazard a guess as to when that will be. But then you would -- at that point, you would normally see then sort of the traditional product revenue and product sales.

Our next question comes from the line of Joseph Thome from TD Cowen.

Maybe just based on the differential biology of Activin E/ALK7, can you talk a little bit about your expectation to see monotherapy weight loss in obese nondiabetic patients with the ALK7 program?

And a point of clarification, when you talk about the expansions of the studies in terms of including that monotherapy diabetic population and expand the overall size, was that for the Activin E/ALK7 programs already, both of them?

Yes. I think -- well, we don't really have expectations in terms of monotherapy weight loss. We'll see what happens. I think we've said a few times that we view these studies as hypothesis generating. So we'd like to see if there's an early signal and then potentially expand cohorts to confirm that signal. So I can't really predict ahead of time what we're going to see.

Then on your second question, the addition of the monotherapy cohort, we did add that in the INHBE study. We will likely have that in the ALK7 study as well.

Our next question comes from the line of Mani Foroohar from Leerink Partners.

I know earlier, so I'm not sure this was asked earlier, but could you give us a breakdown of the EAP versus non-EAP patients out of the 100-plus prescriptions? And how should we think about the total pool of EAP patients rolling on to commercial drug? Is that -- is there a tail of that remaining? And I have a follow-up question.

Thanks for your question, Mani. This is Andy. At this time, we're not going to provide any further details aside from the previous remarks, which the vast majority of patients are APOC3 naive. It gives us a lot of optimism about our ability to identify and diagnose both genetically confirmed and clinically diagnosed FCS patients. And again, with respect to the balance, we do see that fairly evenly split between those patients transitioning off of the expanded access program and those that are coming via switch.

Okay. That's helpful. And a separate question, what are the expectations we should have over the next 12 to 18 months around potential data sets admittedly perhaps early on novel tissue types and further expansion of the platform?

That's a good question, Mani. We've not given any guidance to that at this point. I think we have enough exciting stuff with more ALK7 data, with initial MAPT data, with initial [ Zimer ] data, with SHASTA-3 and 4 reading out with sales that we feel pretty good about those things.

But you know us, Mani. We are always developing the platform, and we are always expanding to the sites. And so I can't -- it's possible that you may hear something about where we're going with the platform as well as maybe new candidates within the existing platform. I just can't give you any guidance on when that might be, I apologize.

Our next question will come from the line of Madison El-Saadi from B. Riley.

On the 100 prescriptions you mentioned, I'm curious how many of those do you expect to be converted to paid drug? And how long does it take to get from prescription to drug [ and ] body? And then relatedly, how should we think about the pace of both patient onboarding and competitive switching? Is this kind of a leading indicator for SHTG dynamic?

Thanks, Madison. Happy to comment. What we're seeing are really high-quality prescriptions in the sense that we believe these prescriptions truly represent either genetically confirmed or clinically diagnosed FCS patients. So we do have high confidence that a significant proportion of those prescriptions will, in time, translate into drug shipments and drug in patients.

As far as the time it takes from prescription to drug shipment, again, that does vary by patient, by insurance and by prior authorization. But I would say, in general, we're able to do that within just a couple of weeks from prescription to patient receiving drug. So I've been incredibly pleased with the patient identification including both genetic and clinically diagnosed and incredibly pleased with the operational execution from the team in converting prescriptions to shipped medicine.

And also just broadly be careful about reading too much into where we are right now. We've only been actively in market for 10 weeks now. And so we're still working with payers. We're still working with physicians to get comfortable prescribing this. We're still informing and educating patients and prescribers about the medicine. So we have a long way to go. Let's see where we are more towards the end of the year. We have a pretty small sample set at this point.

I'm not showing any further questions in the queue. I would now like to turn it back over to Chris for any closing remarks.

Thanks, everyone, for joining us today, and we look forward to speaking with you next quarter.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.

Okay. Good morning. Welcome, everyone, to the 44th Annual JPMorgan Healthcare Conference. My name is Matt Bannon, and I'm a banker here at JPM. I am very pleased to be introducing our first presenting company of the day, Arrowhead Pharmaceuticals. And presenting on behalf of Arrowhead, we have the President and CEO, Chris Anzalone.

Before we kick off, I'll just remind folks that we will have time for Q&A at the end of the session. [Operator Instructions]

So without further ado, Chris?

Well, thanks very much to JPMorgan for inviting us, and thank you all for coming and starting off this busy week. I'm sort of reminded of a tsunami, right? When the tsunami comes, the wave doesn't come immediately. There is -- the tide recedes, and so we are in that receding tide right now. And so good luck for the rest of the week.

Okay. We are AA Pharmaceutical ticker symbol ARWR. Our stock price as of Friday was $64.56. We have about 136 million shares outstanding, giving us a market cap of around $9 billion. And as of our last filing, we had about $920 million of cash and investments. That's not including, however, $200 million that has -- from Sarepta that has been invoiced but not yet received, $200 million from Novartis, which has been received, but not reflected in filings yet and $930 million in recent offerings.

So our job is to bring RNA interference to patients. We have had our first commercial launch. REDEMPLO was approved in the U.S. as well as Canada and China to lower triglycerides in patients with familial chylomicronemia syndrome or FCS. We see this as a multibillion-dollar opportunity across future indications, and this will not be the last drug that we will launch.

We have a broad pipeline. We have 20 clinical stage programs. These are individual drug candidates in clinical studies, 11 of which are wholly owned, 9 are partnered. We have a good mix of early, mid- and late-stage candidates targeting anywhere from rare diseases to more prevalent diseases. Our pipeline will continue to grow. We believe we should grow this pipeline to the tune of 2 to 3 additional drug candidates every single year.

We've got a proprietary platform that we call TRiM that enables us to bring RNAi to a variety of tissues. We are fulfilling the promise, I believe, of bringing RNAi to where disease is. We have the potential for best-in-class across numerous tissue types now. And then finally, and importantly, we've got the financial resources to push all of this forward.

Okay. This is our pipeline. It's quite large. We are a complicated story because we are a broad story. I will try to limit it today to only a few programs. We will talk about plozasiran and zodasiran. We will talk about ARO-DIMER-PA, and we will talk about ARO-INHBE and ARO-ALK7. These are all in the cardiometabolic space. The last 2 are obesity candidates. We'll also just briefly touch on ARO-MAPT. That is our first wholly owned CNS candidates. The rest of these are either partnered or partner candidates with the exception of ARO-RAGE, which is a pulmonary program, and we are right now in a Phase II study in asthma patients.

Okay. We'll start with the platform quickly. Our targeted RNA molecule platform or TRIM, now is able to address 7 different cell types and counting. We think that we can get to a new cell type every 18 or so months. So we can now right now address the liver, lung, skeletal muscle, CNS, adipose, ocular and cardiomyocytes. Importantly, 5 of these 7 are in clinical studies as we speak. We think we are the clear leader in bringing RNAi where a disease is.

So we'll start with the cardiometabolic vertical. So lipid disorders can be characterized by a spectrum of elevated levels of triglycerides and/or cholesterol, and we are addressing the entire spectrum. So on the right side of this, you can see as triglycerides elevate, the increase of acute pancreatitis risk increases. On the left side, as LDL cholesterol levels increase, the risk of ASCVD or atherosclerotic cardiovascular disease increases. And as I said, we are addressing the entire spectrum here.

On the triglyceride side, familial chylomicronemia syndrome or FCS, is characterized by patients with triglycerides in the thousands often, very high triglycerides and an extremely high rate of acute pancreatitis. Slightly less severe is SHTG or severe hypertriglyceridemia. These are patients with triglycerides generally better than 500 that also have an increased risk of pancreatitis.

We believe that APOC3 could play a role in ameliorating these conditions. We thought that if we can knock down APOC3 expression in the liver, we could lower triglycerides. And in fact, that's exactly what we've done with REDEMPLO, formerly plozasiran. We are addressing FCS as we speak. As I mentioned, we are approved in U.S., Canada and China to treat FCS patients. We have ongoing Phase III studies to expand our label to enable us to treat SHTG patients.

On the elevated LDL side, heterozygous familial hypercholesterolemia patients are characterized with LDL levels greater than 190 milligrams per deciliter and the very severe form of homozygous familial hypercholesterolemia characterized by LDL levels greater than 400. This is a rare disease, but obviously an extremely severe disease.

We know that PCSK9 inhibitors can treat this, less so for the true homozygous familial hypercholesterolemia patients, but certainly HeFH patients. We know the PCSK9 inhibitors can treat this. We also thought that ANGPTL3 could play a role here. And so we have developed zodasiran, which is an ANGPTL3 inhibitor, and we are focusing that to treat HoFH patients.

Now between these 2 are mixed hyperlipidemia patients. We think there's about 20 million of these patients, and these patients are characterized by elevated levels of triglycerides and elevated levels of LDL cholesterol. These patients have increased risk of cardiovascular disease. And we are seeking to treat these patients with ARO-DIMER-PA. This is a dimer. This is or a bispecific, if you will. This is a single molecule that is designed to reduce expression of both PCSK9 and APOC3 at the same time and therefore, hopefully reduce LDL cholesterol and triglycerides at the same time.

All right. Let's start with REDEMPLO. This is our first approval. REDEMPLO is now approved in the U.S., Canada and China. It is the first and only RNAi-based medicine that is FDA approved to reduce triglycerides in adults with FCS. It is also the first FDA-approved medicine utilizing our TRiM platform. We launched this towards the end of November of 2025. So we think it's positioned as a very promising new medicine for FCS.

We saw dramatically reduced triglyceride levels in patients with genetically confirmed as well as clinically defined FCS in the Phase III studies. We saw about an 80% reduction from baseline of these triglyceride levels. And this really moves the needle for these patients because, again, these patients had triglycerides in the thousands, and we normalize some of these patients. We got something like 75% of them below 880, which is known to be a substantial increased risk threshold for acute pancreatitis. And we got something like 50% of them below 500, which also is a risk threshold for acute pancreatitis.

We saw reduced incidence of pancreatitis in the Phase III study. This is dosed in a convenient once every 3-month at-home subcu administration. We have a strong label with no contraindications, warnings or precautions. And we've got an innovative -- we think, innovative, consistent one REDEMPLO price model that prices this at a single price across current and future indications.

So we think this is an important medicine because this is an important disease. There are challenges around diagnoses. Many of these patients are not diagnosed until later in life. There is a substantial human cost. Acute pancreatitis is always a severe medical condition and can be fatal in some instances. Importantly, when a patient has their first bout of acute pancreatitis, they are then more likely to have subsequent bout of pancreatitis and those will be more severe.

And in addition, there are other sequelae that these patients suffer from in addition to acute pancreatitis. They have severe brain fog often and they will have recurrent bouts of abdominal pain. And there are substantial direct economic costs associated with this. A single bout of pancreatitis can cost upwards of $60,000 plus per episode and 93% of these episodes involve inpatient stays with an average stay of 10 days.

So while this is an important patient population for us, we'll be building on this. As I mentioned, we are approved in FCS patients. We think there's about 6,500 both clinically defined and genetically defined FCS patients in the United States, and these patients are in extremely high risk of acute pancreatitis. The broader population here is high-risk, severe hypertriglyceridemia patients. These patients have triglycerides above 880 milligrams per deciliter or above 500 with history of pancreatitis. We think there's about 1 million people in this population, and they are at very high risk of pancreatitis.

And then the broader population, the severe hypertriglyceridemia population or SHTG, these patients will have triglycerides above 500. We think there's about 3 million of these in the United States, and these folks have an elevated risk of acute pancreatitis. Now importantly, we have ongoing Phase III studies to support label expansion into this broader SHTG market. We expect this Phase III or these Phase IIIs to read out in the third quarter of '26, and we expect to file an sNDA in the fourth quarter of '26 to enable us to launch into this broader population in 2027.

All right. With that whirlwind, let's move to zodasiran, our ANGPTL3 silencing agent.

So you remember this slide, zodasiran is on the far left here. We think that can be used to treat HoFH. So we think there is -- this is a very rare population. We think there's only 1,000 to 2,000 patients in the United States with homozygous familial hypercholesterolemia. In a Phase II study, we saw about a 41% reduction in LDL-C in HoFH patients. And when those patients were on background therapy of PCSK9 inhibitors, we saw about a 62% reduction in LDL cholesterol. So we do believe that we have a real place to play here.

We have a Phase III study ongoing in HoFH patients that's enrolling right now. We hope to be fully enrolled sometime in the first half of 2026. And we expect our go-to-market product to be a quarterly subcutaneously administered drug that can be administered at home. We think that compares favorably to ANGPTL3 monoclonal antibody treatments that are monthly IV infusions. So importantly, this would be a small incremental lift for our commercial folks. We'll be leveraging our same commercial team that is commercializing REDEMPLO, and we'd be calling on the same physicians. And so for us, this feels like found value.

Let's now move on to ARO-DIMER-PA. This is our dimer that is designed to silence both APOC3 and PCSK9. So this is our first dimer, and we think the world's first dimer that in a single molecule, we can silence 2 genes at the same time. There are a number of potential advantages to a single molecular entity that can target 2 genes at the same time. Certainly, there are regulatory advantages. And also these 2 siRNAs are internalized during the same receptor turnover. This is a big move for us, not only because we think it's a potentially powerful drug in and of itself, but it's a good proof of concept. There are a number of dimers that we can envision in the liver as well as in other tissues that we expect to develop over the next several years.

So ARO-DIMER-PA has worked well in animal studies shown here is in spontaneously dyslipidemic monkeys, we saw good reduction in non-HDL cholesterol, good reduction in LDL cholesterol and good reduction in triglycerides. We would expect this to translate into humans. We have, generally speaking, seen good translation from our nonclinical studies into clinical studies.

So again, you remember this slide, the middle portion here is where we are focused for ARO-DIMER-PA, the mixed hyperlipidemia population. So we think there's about 20 million people in the United States with elevated LDL cholesterol and elevated triglycerides. They are at greater risk of ASCVD. There is no complete treatment right now. So we think that if ARO-DIMER-PA achieves similar LDL-C reductions as current PCSK9 inhibitors and provides triglyceride reductions as well, it could be a very powerful therapeutic.

We expect to begin dosing in mixed hyperlipidemia patients this month in a Phase I/II study. And importantly, we expect initial clinical data towards the end of Q3. This is important because we think that by the end of Q3, we'll know if we have a drug. If we are seeing good LDL reductions, if we're seeing good triglyceride reductions and it's well tolerated, I think we have something that could be truly special here.

Let's move to obesity. So notwithstanding the great success that we've seen with the GLPs of late, there is substantial unmet medical need in obesity. We think the future of obesity care will include recognizing specific subtypes of obesity. Not all obesity is the same disease. We believe that reducing visceral fat is going to be important in order to achieve cardio, kidney metabolic outcomes while also retaining lean muscle mass. We also think the combined therapies is going to be a powerful approach to various populations.

So this is an example of the subpopulations that we see. We know that patients with obesity and type 2 diabetes lose less weight on incretins than nondiabetics. That's important. And we think this could be an important population for us to address at least initially.

So our first 2 candidates are ARO-INHBE and ARO-ALK7. These are both addressing this active and e-ALK7 pathway. The take-home message here is that hepatocytes will produce INHBE that can dimerize to become active INHBE. Active INHBE then combined to ALK7 on adipocytes and essentially tell adipocytes to store fat. We looked at that pathway and we said to ourselves, if we can disrupt that, we could increase lipolysis and potentially decrease fat storage in patients. Our animal data supported that hypothesis as well as genetic analysis have supported that hypothesis.

So we have ongoing Phase I/IIa studies right now. We still have a ton of data to collect, but we did release an early snapshot of some of these data about a week ago or so, and we think the data are interesting. Again, we have a long way to go, but we think they're interesting.

ARO-INHBE saw dose-dependent reductions in active INHBE and circulating active INHBE. We saw a mean max reduction of minus 85% after a single 400-milligram dose, and we saw max observed reduction of minus 94%. ARO-INHBE monotherapy reduced visceral fat. We saw a 9.9% reduction of visceral fat after a single dose at week 16 and a 15.6% reduction in visceral fat at week 24. We did full body MRIs in these patients. And so we have good data on fat loss.

Now importantly, when we combined ARO-INHBE with tirzepatide, we doubled the weight loss in obese diabetic patients compared to tirzepatide alone. We saw about a 9.4% weight loss at week 16 with ARO-INHBE plus tirzepatide compared to a 4.8% weight loss at week 16 with tirzepatide alone. Importantly, this was high-quality weight loss. ARO-INHBE plus tirzepatide gave us about a 23% loss of visceral fat, a 15% loss of total fat and an incredible 76.7% liver fat reduction. This is about a threefold increase in fat reduction compared to tirzepatide alone. This is very interesting, and we look forward to following up on this with additional data.

ARO-ALK7 is earlier than ARO-INHBE, but we've seen interesting data. This is the first RNAi therapeutic at least that we know of to show knockdown of adipocyte expressed target in humans. We saw a mean reduction of minus 88% ALK7 mRNA expression. We saw a max reduction of minus 94%. Now again, this is very early data, but ARO-ALK7 could be an even more active agent than ARO-INHBE. We saw a minus 14% placebo-adjusted reduction in visceral fat after a single dose in monotherapy of ARO-ALK7 at just week 8. Again, we've got a lot of data to collect still, but we think we are off to a very interesting start.

So what are our next steps? We are expanding current studies to include increased numbers of patients to increase our power. We'll extend follow-up to better understand drug durability and activity out to a year. We will initiate a monotherapy cohort in obese diabetic patients, and we will also initiate additional combination cohorts with other GLPs in addition to tirzepatide.

We are running to initiate Phase IIb studies as quickly as we can. And importantly, the current studies and even the expanded current studies are not gating for this. These will include combination studies with tirzepatide as well as other GLPs in obese diabetic patients, and they will also include studies aimed at determining whether or not INH3E and ARO-ALK7 could be used as maintenance therapy once GLPs are removed.

And our obesity pipeline is not finished. We will continue to expand this in the near to midterm. We expect new liver and adipocyte targets. We expect dimers targeting 2 adipocyte targets. We expect dimers targeting 2 liver targets, and we also expect to leverage our subcutaneous CNS platform to address central targets.

So we've got multiple commercial -- potential commercial launches in coming years. On the independent side, as we mentioned, we have launched REDEMPLO for FCS. We launched that in November of 2025. We expect to follow that up with launching in FHTG with the same drug in 2027. We expect to follow that up with launching zodasiran in HoFH patients in 2028. We can follow that with ASCVD indications with ARO-DIMER-PA and follow that with, we think, a number of obesity candidates, including the initial ones, ARO-INHB and ARO-ALK7. These are all wholly owned.

On the partner side, we have late-stage partner programs. Olpasiran is our Lp(a) reducing agent that is partnered with Amgen. They are in Phase III studies right now. We also have fazirsiran that's partnered with Takeda that is looking at alpha-1 antitrypsin deficiency-related liver disease. We are in Phase III studies there. And importantly, that's an important economic component for us. We have 50-50 profits here in the U.S. with Takeda, and we have 20% to 25% royalties ex U.S. And so that's meaningful to us.

Okay. Let's touch on CNS before we walk out of here. Neurodegenerative diseases are, of course, an enormous burden and an extraordinary unmet medical need in the world today, and we thought that RNAi should play a role here. So we've developed a CNS targeting TRiM platform that enables us to address the CNS via a simple subcu injection. It's composed of a transparent targeting ligand that's linked to an siRNA molecule. We have seen deep and durable knockdown in animal studies across even deep brain regions. We see convenient subcu dosing that could enable us to dose monthly or even less frequently. And so far, at least, we've seen a favorable safety profile. We see about a 10x safety margin over what we believe could be the efficacious dose in humans in NHP and in rodent studies.

So where are we? We have already a fairly substantial CNS pipeline. Shown here is our first wholly owned CNS candidates, ARO-MAPT, is designed to silence MAPT, which encodes for the tau protein. We are in a Phase I/II study as we speak. We think that we can address both Alzheimer's as well as smaller tauopathies with this agent. We've seen good animal data. We've got a ton just shown here as an example. We see good reduction in tau in nonhuman primate models. And importantly, we can monitor that reduction in tau expression in the CSF, and that's exactly what we expect to do in this Phase I/IIa study.

So where are we with our ARO-MAPT program? It has the potential, we think, to treat Alzheimer's as well as more rare tauopathies. It is systemically delivered and has shown potent and long-lasting MAPT expression in NHPs with potential for monthly or less frequent dosing. Our current formulation supports subcutaneous administration of 150 milligrams of siRNA total volume of less than 4 milliliters. And we are continuing to optimize our formulation here. Our GLP tox studies were good. Our NOAEL was the highest dose tested. And we are, as I mentioned, in Phase I/IIa studies.

Now importantly, we will have our initial readouts, we think, sometime towards the end of Q3. We are taking CSF samples from healthy volunteers as well as patients. And so we can see how well we're knocking down tau. That's very important. As a proof of concept, certainly for the drug. If we see good MAPT knockdown, that's an important thing for this drug candidate, but also for the broader platform. If we are able to knock down MAPT, it would suggest that we can knock down other gene targets in the CNS. And I think we are off to the races at that point, and there are a number of good targets we can go after and a number of unmet medical needs that we can help to alleviate.

So we have a number of upcoming milestones in 2026. First, we'll have a first -- a whole year of commercial sales of REDEMPLO in FCS. As I mentioned, we are now approved in the U.S., Canada and China. We are awaiting approval in Europe. We have Phase III studies of plozasiran in SHTG population. We think these will read out in the third quarter of 2026 to enable us to file an sNDA in the fourth quarter. And importantly, we think that's a multibillion-dollar opportunity. We think that's a broad population and plozasiran REDEMPLO has performed very well in FHTG patients in the past.

ARO-DIMER-PA is targeting PCSK9 as well as APOC3 reduction. We will begin dosing, we think, in the next -- over January or so. And we think we can have our first clinical readout in the second half of '26, probably more towards the end of Q3 2026. We think that's going to be important. If we see good LDL reduction, good triglyceride reduction and it's well tolerated, that would suggest that we really do have something powerful to treat those 20 million people in the U.S. with mixed hyperlipidemia.

Our obesity franchise will continue to grow. We'll have new targets, including dimers, we think. We will also have additional ARO-INHBE and ARO-ALK7 data presented throughout 2026. We have an emerging CNS pipeline with systemic delivery via subcu administration. We will have early ARO-MAPT data presented in the second half of '26. Again, I think that could be towards the end of Q3 2026. And then finally, we have the cash to push all of these programs forward.

With that, I'd like to open the call -- the meeting to questions.

Any questions from the audience? Chris, maybe I'll start with MAPT as a target. Others have gone for it. So what's your advantage here? I didn't see the others on the side, but I know others have. So what's your advantage here? And what's the goal for knockdown?

Sure. So I think the MAPT is the -- is arguably the best validated target for Alzheimer's. And the biology is clear for other tauopathies. That is fairly clear. Other attempts have used intrathecal injection, and we've seen some good results that have been encouraging. We think that if we are able to accomplish this subcu injection, the systemic delivery that we would obsolete any IT administered product overnight. We will see if this translates into humans. We've had very good luck. We've got virtually 100% track record of animal data translating to humans, but we'll see if this translates.

We don't know what the bogey is for how much knockdown you need to see a clinical benefit. Some of Ionis' data have suggested that if you can see 50% knockdown that you could see clinical benefit. And so that to us is probably the best milestone we have. We've seen better than that in NHP models. And so we're hopeful that we can see that in humans. But we're really excited about this.

As I mentioned, the early data here are important for us for 2 reasons. One, for ARO-MAPT, we think it's an important -- potentially important drug candidate. And I think we'll have our first clue about whether or not it will translate in humans. But also if we see good knockdown of MAPT or tau in the CSF, it would suggest that we really do have this ability to deliver to the brain via systemic delivery, and that is extraordinarily disruptive. And we will follow that up very quickly with a number of new candidates in the CNS.

Maybe you could just give us some more color on the market opportunity for plozasiran, both in FCS and SHTG.

Sure. So let's see. So for FCS, it's a narrow population. We think there's about 6,500 patients with genetically defined or clinically defined FCS. This is a substantial unmet medical need, and we are selling into this population as we speak. The real economic opportunity here is in FHTG. We think there are 3 million to 3.5 million people in the United States with triglycerides above 500. We know that 500 is a threshold where the risk of pancreatitis increases substantially. It increases again at 880 or so. And we think there's about 1 million people with triglycerides above 880.

And so this is a fairly broad population that should respond well to this drug candidate. Boy, I think that literally everybody that we've treated has had a reduction in triglycerides. I think that this works consistently across patients. As I mentioned, in the FCS study, we saw about an 80% reduction of triglycerides from baseline. Our Phase II in SHTG patients suggested similar good reduction in triglycerides. And so the chances are this should be a an active as well as well-tolerated drug. And this is near term for us. As I mentioned, the Phase III supporting the expansion into the broader SHTG market will read out in the third quarter, and we expect to file an sNDA in the fourth quarter to allow us to launch into this population around 2027.

Okay, question here.

Just want to understand a little bit on our pricing strategy for plozasiran in terms of SCS and SHTG and also the competitive dynamics with the other players in this space. That's my first set of question.

The second question is on INHBE. I understand we have pretty good Phase I data, and that translates to roughly additional 5% weight loss. And in terms of development strategy, are we mostly looking to do that with tirzepatide combo in the -- like studies going forward? And how do we think of the chance to, say, replicate the Phase I data into like larger trials going forward? And are we going to do like a partnership with any large pharmas in terms of this obesity development?

Okay. Thank you. So on the pricing strategy, look, FCS is a narrow population. And there is -- we could have priced that at many hundreds of thousands of dollars because the drug works well and it's a narrow population. We didn't think that was the right thing to do because the big economic opportunity here is in severe hypertriglyceridemia. We are pricing this at $60,000. That is the price for FCS patients. That will also be the price for -- or expected price, at least for SHTG population.

It was important for us to help payers understand the value of this drug, and that's just going to take a bit of time. We thought that if we jump out at this lower price, we will sacrifice some near-term revenue. But longer term, we think we have a better chance of this being priced appropriately. As we talked about earlier, a single bout of pancreatitis can cost upwards of $60,000. So there are substantial direct economic costs associated with FCS and SHTG. But there's also lesser sequelae such as brain fog and abdominal pain. And so everything that -- anything that we can do to ensure that we get the right price for the broader population is a good investment for us to make. And so that's why we did it. And so far, it's been well received by payers, but we're still early here.

On the INHBE side, let's see. The question there had to do with follow-up studies. So yes, you mentioned that our Phase I data were good. Let's temper that. They look interesting. These are very early data. These Phase I studies are not even complete yet. This is an early snapshot that gives us some hope that we are on the right track, but we still have a long way to go. Should these data hold and we continue to see these favorable data, we feel really good about Phase II studies. Having said that, we've seen enough to go ahead and start at risk planning for Phase II studies.

The obvious patient population here is obese diabetics. The drug seems to work well there, at least in combination with tirzepatide. We don't have monotherapy data in that population. So we're going to interrogate that shortly. We are amending our protocol right now to get into those patients right now. But we do think that at least the early data suggests that when combined with tirzepatide, we can have -- we can make a real impact on these obese diabetic patients.

We will do study -- we'll do broader studies in that population with tirzepatide, but we'll also do it with other GLPs. It's important -- should this bear out, it's important that that we can show that the background therapy of some type of GLP can be applied to ARO-INHBE and potentially to ARO-ALK7. Hopefully, we are agnostic, right? It's not just tirzepatide, it could be other ones. So those are important.

We are also interested to know -- and this is a little bit of a trust fall, but we are also interested to see if this could be used as maintenance therapy. Whether it's GLPs or other strategies, we are pretty good at helping people lose weight. We are not good at helping people keep weight off. And so we see a big opportunity there. And so we will start studies that will be withdrawal studies, right, where patients will lose weight on a GLP with or without INHBE and ALK7, and then we will see if we can keep that weight off by keeping them on INHBE or ALK7.

Again, we have no data yet. And so we'll see where that goes, but we see that as an intriguing possibility. But again, for the near term, I think the -- our best bet here is in the obese diabetic patients, either in therapy -- either in combination or potentially as a monotherapy.

I think your slides alluded to the potential for a dimer in obesity. Is INHBE and ALK 7 the possibility or no because different cell locations, how does your technology?

Yes, it's a great question. So this idea of dimers for obesity is a really cool idea. We're really excited about that. It would not apply specifically to INHBE and ALK7 because those are 2 different cell types, right? INHBE is expressed in hepatocytes. ALK7 is expressed in adipocytes. And so the dimers that we're thinking about would be single cell type dimers, if you will, right? So there are other obesity targets that we can go after that are expressed in hepatocytes. And so we imagine dimerizing or knocking down at the same time INHBE as well as some of these other targets.

And on the ALK7 side, we know there are other adipose expressed targets that we can go after that we can combine with ARO-ALK7. That won't be this year. We are developing those now, and that's more like a '27, '28 time frame, but we will be developing those, and you'll probably hear about some nonclinical data in the nearer term, but those won't be in the clinic in '26, that is for sure.

Got it. So on the APOC3 and PCSK9 dimer, can you just give us an overview of the opportunity there?

Sure. We're also really excited about that. We think there are about 20 million people in the U.S. with elevated triglycerides as well as elevated LDL cholesterol. Everybody knows that LDL cholesterol is a risk factor for atherosclerotic cardiovascular disease. We've got tons of data there from statins to PCSK9 inhibitors, and there are good curves that you can dial in if you can reduce LDL by X percent, you can reduce ASCVD risk by Y percent. That's well understood.

What is new or newer is the importance of triglyceride-rich lipoproteins as characterized by triglycerides. Those may be even more atherogenic than LDL cholesterol. They have not been well studied because there's not been a good way to lower triglycerides in the past. We now have a way. And so we love the idea of addressing these 2 independent risk factors. You lower LDL cholesterol, you lower triglycerides. We know patients with mixed hyperlipidemia have an increased risk of ASCVD. And so if we can knock down these 2 factors, we think that we can substantially reduce the risk of ASCVD.

And importantly, this is a funny situation where I think over the course of only a few quarters, we'll have a pretty good idea if we have a drug here. We'll know if we're well tolerated, and we'll know if we are getting reasonable LDL reduction and reasonable triglyceride reduction. I don't think we have to be -- I don't think we have to have as good reduction of LDL as PCSK9 inhibitors, but we have to have substantial reduction of LDL. I don't think we have to have as good reduction of triglycerides as we see plozasiran and REDEMPLO, but we have to have a good reduction of triglycerides. If we see that, I think it will give us good confidence that we have something that could really play in this market, and it's a very large market.

Importantly, there is a nearer-term regulatory pathway that could potentially enable us to be approved based solely on LDL reduction. That could be a fairly small study. That could be a year-long study. And so we think we can get to market fairly quickly with what we think could be a real game changer in this large market.

Yes, question?

[indiscernible] patient population and the opportunity to invest. How do you see this translating to your European market [indiscernible].

Sure. The question is we were talking about U.S. populations, but how do we see this -- how do we see these drugs being applied to European markets? The answer is, look, patients are patients. We do expect to market these drugs in Europe and beyond. And we are formulating our strategy on how we do that. There may be some geographic partnering. I think over time, we will certainly be selling into international markets. The question is when do we jump into that, and we have not made that decision quite yet.

And it just occurred to me. There's another question over here earlier about INHBE that I did not answer, which was related to partnering. Let me be clear on obesity and partnering. We are not looking to partner INHBE and ALK7 right now. We think there's too much value for us to create by ourselves. We can handle this right now. We think these Phase IIs could be really value generating, and we can execute ourselves. And so it's important for us that we keep these wholly owned at least for right now.

Yes, go ahead.

Can I have a question on the cash management. When do we expect to have breakeven? And what are we going to do with the existing $900 million together with the money from Sarepta and the recent raise? And how do we prioritize these later-stage trials?

Yes, it's a good question. So we have not guided on when we get to breakeven at this point. I think we'll probably do that sometime in 2026. We haven't done it yet. But I can tell you just qualitatively, with the $920 million or so that we reported in our last filing, plus $200 million from Sarepta, plus $200 million from Novartis, plus $900-plus million of gross proceeds from these offerings, plus another $50 million that we expect to have from Sarepta in the February or so time frame in 2026, we have plenty of cash, plenty of cash to push these important programs forward. And that actually dovetails well into what I mentioned earlier about ALK7 and INHBE staying wholly owned. These -- this capital allows us to push these forward in a wholly owned fashion, and we think that's the right thing to do for our shareholders and for our stakeholders. Same thing with ARO-DIMER-PA, same thing for plozasiran. We can launch that independently in SHTG, at least in the United States. Same thing for zodasiran. We can launch that independently at least in the United States. And then let's see where our follow-on candidates go.

Thanks so much, Chris.

Thanks very much.

Good morning, and welcome to the Arrowhead Pharmaceuticals' Virtual KOL event. [Operator Instructions]. As a reminder, this call is being recorded, and a replay will be available on the Arrowhead website following the event.

I'll now turn the call over to Vincent Anzalone, Arrowhead's Vice President of Finance and Investor Relations. Please go ahead, Vince.

Thanks so much, Wilson, and thanks, everybody, for joining us today. We are excited to talk about our first interim results from our 2 obesity candidates, ARO-INHBE and ARO-ALK7. The press release went out this morning. So I'd like for all of you to refer to that. In addition, we will be making forward-looking statements today. So please refer to the risk factors in our SEC filings.

So what we're trying to accomplish today is we have an external obesity and metabolic disease expert, Dr. Carel Le Roux, who will join us. He's going to talk about what we see and what he sees as the next in obesity treatment in areas of unmet need that still need to be addressed. James Hamilton, our Chief Medical Officer and Head of R&D will talk about the therapeutic rationale for targeting the Activin E/ALK7 pathway. We'll move on to interim results from the Phase I/II studies of both ARO-INHBE as well as ARO-ALK7. And then our CEO, Dr. Chris Anzalone, will talk about some key takeaways from the presentation. And then the whole panel will be available for a Q&A session following that.

As I mentioned, Dr. Carel Le Roux is with us. He is -- he's the Chair of Metabolic Medicine at the University College Dublin, School of Medicine. And again, he is an expert in metabolic medicine and obesity. And we're very lucky to have him today. So I'd like to turn the call over to Dr. Le Roux. Thank you.

Well, thank you very much. I really appreciate that. And I start with this famous painting from Joseph Wright of Derby, The Alchemist, and just how he discovered these new things. And I think this is Arrowhead and their scientists making these discoveries. And you can see yourself maybe there in the background, keeping careful notes of what's happening. And of course, I think this is the exciting bit about moving forward with what's now available to us. These are my conflicts of interest, and we work with lots of different companies: with nutrition companies, with pharmaceutical companies and surgical companies because we do not think obesity is one disease. And therefore, we will need multiple different treatments, especially that we can use in combination.

But one of the things that we don't ask our patients to do anymore is illustrated by Sisyphus on the right there, which we don't ask people with obesity to eat less and move more anymore. Because what we do is we're just to remove the rock. We take the rock away because we can treat this disease now effectively. But we also need to remain a bit humble when we actually look at the difference in what we can achieve in people with or without diabetes.

Here, I'm showing you the reduction in cardiovascular death over the last 20 years. And you can see we've made great improvements, but there remains an unmet need. People with type 2 diabetes continue to do less well than our patients that don't have type 2 diabetes. So it's really a paramount that we are able to make this gap less and actually understand what we can do in this instance.

And I think that's just understanding the anatomy and the differences between visceral adiposity and subcutaneous adiposity. Visceral adiposity, far less in absolute amounts, but really driving a lot of the problems because it sits around the organs, it sits inside the organs, inside the liver, inside the pancreas, and that is where a lot of problems are harbored. And if we can reduce the visceral adiposity, then we're going to see massive improvements in our metabolism. And that's what we've seen many of our different treatments so far.

So let me come back to this concept of obesity and whether or not it's one disease or multiple diseases. If you look at the x-axis, what you can see there is any measurement of obesity. It could be adiposity size, it could be BMI. But the heaviest somebody becomes, if you now look at the Y-axis and here I have cardiovascular risk, you can see that most people behave in a linear fashion. So the heavier they are, the sicker they are.

However, you can also see that there are patients who are discorded, there are people that are very heavy but not sick at all. And there's other people who are less heavy, but very sick. So is this, in fact, one disease that just have heterogeneity or are we, in fact, dealing with multiple different diseases. And that's what we're trying to do in the SOPHIA study sponsored by the European Union together with many industry partners and academic partners by trying to understand if obesity is at least has multiple subtypes, and what we've been able to do here is say that, yes, the majority of patients are concordant. They behave -- the heavier they become, the sicker they become.

But you can see those spikes here. There are patients who are discordant for hypertension, discordant for transaminases in the liver, discordant for lipid profiles, discordant for glycemia as well as discordant for inflammation. And then if you look at how these patients behave, what you then see, if I highlight those patients who are discordant for hyperglycemia, they have a much higher risk of having cardiovascular disease or strokes. They have a much higher risk also of having liver failure. So we can see that this cohort behaves in a different way, and we also understand that visceral adiposity is a major challenge for them.

So how well have we done over the last 70 or 80 years? In fairness, if you had a diet approach in the 1960s, you would have lost somewhere between 5% and 10% of your weight. And if you have a diet approach today with all the apps known to man, you're going to lose about 5% to 10% of your weight. Equally so, if you had an open gastric bypass operation in the 1960s, you would have lost about 25% to 30% of your weight. If you have a laparoscopic gastric bypass today, which is much safer, you could be done almost a day case, but you're going to lose about 25% to 30%. So we haven't changed the efficacy of those treatments.

However, if you look at the bars, and you look at pharmacotherapy, what you can see here is we have a scalable treatment that is substantially improving. So now we are actually able to do much better in that instance. But let's now look at our scalable treatments. And here, I'm showing you 2 different treatments, semaglutide and tirzepatide in the SURMOUNT-5 study published in the New England Journal. And what we've done is we've shown that if you do this head-to-head study, both of these compounds behave almost exactly the same as they did in the studies done by Novo Nordisk with semaglutide or Lilly with tirzepatide. So we get about 15% weight loss with semaglutide, about 21% weight loss with tirzepatide over a 72-week period. So this has really changed the way we are treating the disease of obesity.

However, if we now look at the treatment targets that we are achieving with this, and remember, if we think about any other chronic disease, be it hypertension or dyslipidemia or type 2 diabetes, we don't talk about the percentage reduction in fasting glucose or the percentage reduction in systolic blood pressure or the percentage reduction in LDL cholesterol. We talk about how many patients got to the target for diabetes, 6.5%; for blood pressure, 130 over 80; for dyslipidemia, we're talking about 2 millimoles per liter for LDL. So we're talking about how many patients can we get to the target.

And if we think about obesity right now, we are still talking about percentage weight loss, and that may not be valuable in the future. So here, we just looked at targets, either body mass index targets or waist-to-height ratio target. Again, waist-to-height ratio talks to us about visceral adiposity. And what you see now when you look at the SURMOUNT study: blue, semaglutide; in the green, tirzepatide, the SURMOUNT-5 study, you could see that although more patients achieve the targets with tirzepatide, only about 14% or 23% of patients achieved both the hemoglobin -- both the BMI target and the waist-to-height ratio target. So it tells you that we have very good drugs right now, but we are not hitting the targets the way we want to be doing that.

And if we even look about how many patients when they actually hit these targets have normalization of the cardiovascular risk factors. Here, I'm showing you the baseline data of the SURMOUNT-5. And I only want you to focus on the far right, all of the targets. So we're talking about people who are both normoglycemic and have normal lipids and have normal blood pressures. And you can see at baseline, about 8% of patients reached that. But if you now fast forward and see how many people reach those outcomes once you hit the BMI and the waist-to-height ratio targets, that jumps to 62% or 52% of the patients. So reaching those targets is going to get us a lot more health gain in the future.

Now our problem is that not only we're not doing well enough from a cardiovascular outcome point when it comes to treating our patients with type 2 diabetes and obesity, even when we just look at percentage weight loss, we see that with tirzepatide, we're not getting as much weight loss as we do in patients with type 2 diabetes in comparison to our patients that don't have type 2 diabetes. So that means that our patients with type 2 diabetes are not achieving our targets, again, coming to this idea that we need to do something extra for our patients who have more visceral adiposity and especially those patients with visceral adiposity who also have the manifestation of complications such as diabetes.

Now what is the mode of action and in the future, where are we going to go? And no doubt that the gut hormone classes, so GLP-1 -- combinations of GLP-1, GIP combinations with glucagon, amylin, FGF21, these are very exciting and very, very fruitful it's going to be in the future. But we also need other modes of action to complement these. And that's, I think, when we look at the Activin E story, I think here, we have a novel target where we are able to actually add to our patients who have metabolically unhealthy adiposity. Those patients who also can't have as frequent administration.

So that's why an RNAi-based approach can be helpful, and of course, potential to complement other weight loss therapies. Because as a clinician, when I treat people with hypertension, I don't rely on just one class of treatment. If I treat people with diabetes, I don't rely on just one class of treatment or dyslipidemia. So it's the combination of approaches that I think is going to hold so much value for our patients in the future.

So allow me to conclude and suggest to you that the future of obesity care will include recognizing the different subtypes of the disease of obesity. Reducing visceral fat to achieve better cardio-kidney metabolic outcomes is going to be key for us to achieve. And ultimately, combining our therapies to achieve a lower cardiovascular risk state is where we, as clinicians want to go. So I am handing back and we'll be able to address some questions later on in the session.

Thanks, Dr. Le Roux. And just to reemphasize, as Dr. Le Roux had stated, obesity and more specifically, visceral adiposity are associated with the sequelae of metabolic disease, including type 2 diabetes. atherosclerosis and hepatic steatosis as well as all-cause mortality. And visceral fat reduction leads to improvement in risk factors for metabolic disease.

So far, the GLP-1 agonists have shown the ability to reduce visceral fat, but also reduce lean mass and have certain tolerability issues as well as a high rate of discontinuation. Therapies that facilitate fat loss with a specific -- specificity for visceral fat may have additive cardiovascular benefits. The Activin E/ALK7 pathway stimulates fat storage in adipocytes and is an important regulator of visceral adiposity. In the liver, the INHBE gene codes for the Activin E protein, which is secreted into the blood and binds to its receptor, ALK7, on the surface of the adipocyte, thereby slowing lipolysis and stimulating adipocyte hypertrophy.

Loss of function variants in both INHBE and ALK7 are associated with an improved waist-to-hip ratio adjusted BMI, reduced risk of ASCVD as well as a reduced risk for type 2 diabetes and a reduced ApoB hemoglobin A1c and reduced visceral fat volume. Of course, the therapeutic hypothesis here is that silencing expression of either INHBE or ALK7 could phenocopy the favorable phenotype seen in the loss of function variant carriers. And to test this hypothesis, we launched 2 separate but similar clinical trials, and I'll first cover the ARO-INHBE-1001 study.

This study initiated in healthy volunteers with a BMI of 30 or greater who received either single or multiple escalating doses of ARO-INHBE as a monotherapy. We also enrolled cohorts of nondiabetic and diabetic obese participants who initiated combination therapy with tirzepatide plus ARO-INHBE at the beginning of each cohort, and we are pleased to report that all cohorts are now fully enrolled.

The primary and secondary endpoints of the study were safety and PK and key efficacy and pharmacodynamic endpoints included changes in Activin E, body weight change, changes in body composition as well as changes in lipid and glycemic control parameters. Here, we show the baseline characteristics of the monotherapy cohorts. Baseline mean body weight was over 100 kilograms with mean BMIs of greater than 35. Participants had minimal hepatic steatosis at baseline, normal hemoglobin A1cs and baseline Activin E levels in the 450 to 500 picogram per ml range.

Turning to target knockdown and pharmacodynamic data. Here, we show a dose response and Activin E reduction with increasing dose levels of ARO-INHBE. We achieved a mean maximal Activin E reduction of 85% at the 400-milligram dose with a duration of activity lasting beyond 3 months after a single dose. Importantly, this single-dose target knockdown translated into key improvements in body composition, including a reduction in visceral fat of about 10%, relative reductions in liver fat of about 38%, a modest increase in lean mass of about 2% and a reduction in muscle fatty infiltration. Here, we show that repeated doses of ARO-INHBE further improved visceral fat reductions with placebo-adjusted mean improvements of up to 15.6%.

Now transitioning to the combination cohort data with an emphasis on the obese type 2 diabetic combination cohorts. We are highlighting this population as obesity and diabetics represents an area of unmet need. This population loses less weight on GLP-1 therapies and may have an overly dysregulated Activin E pathway. We also studied combination therapy in nondiabetic cohorts, and these data will be shared at a later date.

First, the baseline characteristics of the obese type 2 diabetic cohorts. These patients were older with a mean age of 52 and still obese with a mean weight of 103 kilograms and a mean BMI of 36.6. This group had a mean baseline liver fat based on MRI-PDFF of 17.1% with an elevated mean hemoglobin A1c of 7.4. And importantly, this group had an elevated mean baseline Activin E of about 661 picograms per ml, which is higher than the baseline Activin E levels in the monotherapy obese healthy volunteer cohorts.

This uniquely elevated Activin E level in the diabetics is something others have described in the literature as shown on the left panel, where INHBE-mRNA expression from liver biopsies correlates strongly with levels of insulin resistance. This is also something we've seen in our own nonclinical work with diabetic nonhuman primates having higher baseline Activin E levels compared to nondiabetic animals. And on the right panel, we show that baseline Activin E levels from the diabetic cohorts in this Phase I study show a statistically significant elevation at baseline compared to the nondiabetic cohorts.

In our own study, we've confirmed the correlation of Activin E levels with worsening insulin resistance. And additionally, Activin E levels are strongly correlated with measures of obesity such as BMI and waist circumference as seen in the red line in the middle and right panel, with much less correlation seen in the nondiabetics represented by the blue line. In total, Activin E levels are higher in obese diabetics and the levels correlate most strongly with measures of obesity in the diabetic population. Critically, in multiple clinical trials, the obese diabetics lose less weight on incretin therapy and are less likely to reach weight loss targets. Thus, there remains an unmet need for combination therapies that can synergize with incretins to enhance weight loss in this incretin-resistant population.

Recall that in preclinical studies, we demonstrated synergistic weight loss in obese diabetic mice, combining INHBE siRNA with tirzepatide as shown in the orange line compared to the purple line representing tirzepatide alone. In fact, the enhanced weight loss seen in the diabetic mice with combination therapy was a key reason why we opted to study obese diabetic patients separately in this study. In the diabetic obese patients in the clinical trial, ARO-INHBE plus tirzepatide combination therapy achieved up to 84% reduction in Activin E levels after 2 doses. No Activin E reductions were seen with tirzepatide alone.

In the combination cohorts, all participants received weekly tirzepatide through week 24 with the addition of ARO-INHBE 200 milligrams, ARO-INHBE 400 milligrams or placebo. Preliminary data in the obese diabetics indicate the addition of ARO-INHBE enhanced weight loss compared to tirzepatide alone with a mean weight loss of 9.4% in the high-dose combination group compared to 4.8% in the tirzepatide plus placebo group at 16 weeks. Additionally, there does seem to be a dose response with lower dose ARO-INHBE combination therapy also showing a degree of enhanced weight loss, but to a lesser magnitude.

In this population, combination therapy shows a dose response of enhanced mean reduction in visceral fat of 23.2%, a 15.4% reduction in total fat and up to 76.7% relative reductions in liver fat, all at the 400-milligram dose level on the week 12 MRI. These reductions represent approximately a threefold enhancement compared to tirzepatide alone. I'd like to emphasize that these are week 12 MRI data with the 5-milligram dose of tirzepatide, which is one of the more commonly used doses but is not the highest dose available. And in fact, while these data are preliminary, some of the week 12 combo therapy reductions we are seeing such as the large reduction in visceral fat, the large reductions in the visceral fat to abdominal fat ratio and the liver fat reductions are already on track to meet or beat the reductions seen in the SURPASS-3 study after 52 weeks of tirzepatide in an obese diabetic population.

Our initial results have shown some interesting signals in diabetics, and we think there is a physiologic explanation for this. Specifically, in normal individuals, insulin is the key regulator of lipolysis in adipose tissue. In conditions of insulin resistance or lack of insulin secretion, other regulators, such as the Activin E pathway may play a more important role in regulating fat storage. Silencing Activin E may result in enhanced fat loss in the diabetic population, a population that may rely more on Activin E as a regulator of lipolysis.

Now turning to safety. ARO-INHBE was well tolerated both as a monotherapy and in combination with tirzepatide. Most TEAEs were mild and no AEs led to discontinuation. Injection site AEs were mild and self-limited, and there were no differences in GI AEs with combination therapy versus tirzepatide monotherapy. One SAE of limb abscess was reported, which was not related to drug. And there were no clinically significant adverse trends in labs, including transaminases, glycemic indices and lipid parameters. And this is supported by the data on the next slide. Here, we show that in the monotherapy cohorts, both the SAD and the MAD cohorts, ALT and hemoglobin A1c were stable throughout the study.

In the obese type 2 diabetes cohorts, we saw a decrease in ALTs, likely due to the large reductions in liver fat in the combination therapy arms compared to the tirzepatide monotherapy arms. Hemoglobin A1c was reduced for all groups reserving tirzepatide, including the combination cohorts. In summary, ARO-INHBE has been well tolerated and achieves robust and sustained reductions in Activin E. Monotherapy ARO-INHBE leads to favorable changes in body composition and combination therapy in obese diabetics enhances weight loss and fat loss compared to tirzepatide alone. This represents an opportunity for additive therapy in a population that has more difficulty hitting weight loss targets.

In terms of next steps, we are currently in the planning stages of various potential additions to this Phase I study and Phase II study is intended to confirm the signals identified in Phase I.

So now let's switch gears to discuss the ARO-ALK7 program. As a reminder, this study is about 2 quarters behind the INHBE program. Recall that ALK7 is the receptor on the surface of the adipocyte, which binds to Activin E as well as other ligands such as Activin B, C, GDF11 and others and activation of the ALK7 pathway inhibits lipolysis. The study design is almost identical to the INHBE study design. We enrolled, again, obese healthy volunteers to receive either single or 2 doses of drug, followed by combination multi-dose cohorts in nondiabetic and diabetic patients.

One key difference is that adipose biopsies are used to measure knockdown of ALK7 mRNA pre-dose and post-dose in this study, and this is in contrast to the INHBE study where there's a serum measurable biomarker. Also in this study, the multi-dose interval is 3 months, whereas in the INHBE study, we dosed on day 1 and day 29. This 3-month interval was selected based on the long duration of activity we saw in nonhuman primates. The obese healthy volunteer cohorts are now fully enrolled and enrollment of the combination cohorts has initiated.

Again, endpoints are largely the same with the exception that measuring PD effect requires adipose biopsies. And then for the baseline characteristics of the obese healthy volunteer cohorts, baseline body weights were about 105 kilograms with mean BMIs of greater than 36. And right now, we only have single-dose ALK7 knockdown data at the 200-milligram dose level, which is the second to highest dose planned. We are seeing mean knockdown of 88% and maximal knockdown in any individual of 96% after a single dose with an effect that appears to last at least 12 weeks. Achieving this level of knockdown is important as it helps to validate the platform. And to our knowledge, this is the first clinical trial data demonstrating siRNA-mediated gene silencing with a platform targeting adipocytes.

This level of knockdown translates well into changes in body composition with an observable dose response in visceral fat reduction and a mean placebo-adjusted reduction of 14.1% at the 200-milligram dose level and this was achieved after only 8 weeks of exposure on the week 8 MRI. Preliminary safety data indicate that ARO-ALK7 has been well tolerated as a monotherapy. Most TEAEs have been mild with no TEAEs leading to discontinuation and no reported SAEs. As is the case with INHBE, no meaningful pattern of adverse lab value changes have been reported, which includes liver enzymes and glycemic control parameters.

Overall, ARO-ALK7 has been well tolerated, and the knockdown data confirms translation of our animal pharmacodynamic data into humans and validates the ability of the platform to deliver siRNA to adipocytes. Healthy obese cohorts are fully enrolled with combination cohorts currently enrolling, and we expect to release additional data throughout 2026.

Lastly and most importantly, we'd like to thank all the healthy volunteers, patients, investigators and site personnel who participated in these studies, and I'd like to hand the floor over to Chris.

Thanks very much, James. Thank you for joining us today and hearing about these exciting programs. They are the result of years of research by countless dedicated individuals, but represent only the first steps in our drive to create innovative obesity therapeutics with a focus on weight loss, metabolic disorders, diabetes and body composition.

Today's data are still quite early, but there are some key takeaways that will help guide our future development and that make us cautiously optimistic that these first 2 candidates may play a role in future obesity therapeutic paradigms. ARO-INHBE demonstrated dose-dependent reductions in serum Activin E levels with mean max reductions of minus 85% and maximum observed reductions of minus 94% after a single 400-milligram dose. This was associated with reduced visceral fat when used as a monotherapy of minus 9.9% after a single dose at week 16 and minus 15.6% after 2 doses at week 24.

Combining ARO-INHBE with tirzepatide doubled the weight loss seen in obese diabetic patients compared to treatment with tirzepatide alone. The combination resulted in minus 9.4% weight loss at week -- I'm sorry, at week 16 compared to just minus 4.8% with tirzepatide monotherapy. Importantly, this appears to be high-quality weight loss. Obese diabetic patients showed a minus 23.2% reduction in visceral fat, minus 15.4% reduction in total fat and a whopping minus 76.7% reduction in liver fat when treated with ARO-INHBE plus tirzepatide. These were approximately threefold higher reductions than with tirzepatide alone in all 3 measures. We believe these are truly stunning results.

Turning to ARO-ALK7. We saw a mean reduction of minus 88% ALK7 mRNA and max reduction of minus 94%. We believe this is the first human demonstration of RNAi-mediated knockdown targeting adipocytes and represents an important proof of concept for our ability to address the cell type. Adipose is the largest endocrine organ in the body, and we believe there are many additional cardiometabolic targets we may now go after. This early POC could unlock a number of new drug candidates for us.

Regarding ARO-ALK7 specifically, the minus 14% placebo-adjusted reduction in visceral fat we saw after a single monotherapy dose at just week 8 is exciting. The study is still quite early, but we have reason to believe that ARO-ALK7 may be even more active than ARO-INHBE, so we are looking forward to seeing more complete SAD and MAD monotherapy data and certainly combination data with tirzepatide.

We still have more to do in the current Phase I/IIa studies but have already accomplished much. For ARO-INHBE, we've established a very strong safety and tolerability profile in SAD, MAD and combination studies with tirzepatide. The ARO-ALK7 studies still require more time, but the SAD portion of the studies give us confidence in a good safety and tolerability profile and early time points in the other portions of the study look encouraging. We demonstrated deep and durable knockdown of Activin E and ALK7. We have clear signals that the Activin E/ALK7 pathway is translating in humans. We have seen strongly favorable changes in body composition, and we've seen good weight loss in obese diabetic patients, a population that responds relatively poorly to GLP therapies and one that also has arguably the greatest unmet medical need.

In addition to completing the current studies and reporting those results, there are a number of next steps we are focused on. First, we are expanding existing studies in a number of ways, including increasing numbers of patients to increase power, extending follow-up to better understand drug durability and activity out to a year. We are initiating monotherapy cohorts in obese diabetic patients, and we are initiating additional combination cohorts with other GLP drugs.

Second, we are moving as quickly as possible to Phase II studies. Importantly, we believe we know enough now to get these processes moving so the current and additional Phase I/IIa studies are not gating. The Phase II studies will be starting -- the Phase II studies we will be starting are combination studies with tirzepatide as well as other GLP drugs in obese diabetic patients and studies aimed at interrogating ARO-INHBE and ARO-ALK7 as maintenance therapy after GLPs are removed.

Third, we are focused on expanding the obesity pipeline. We have a number of new liver and adipose targets we plan to address, and we are also planning to develop liver dimers and adipose dimers capable of silencing 2 genes with a single drug. We are also planning on leveraging our new systemically delivered CNS platform to address brain targets using a simple subcutaneous injection.

Our work in obesity fits well with our cardiometabolic launch plans. In November, we launched Redemplo to treat FCS patients. Our Phase III study supporting label expansion to include a broader severe hypertriglyceridemia population will read out in Q3 2026, and we would hope to launch in Q4 2027. Zodasiran, our ANGPTL3 drug, is being developed to treat homozygous familial hypercholesterolemia, and we believe that could be launched a year later in Q4 2028. Our first dimer, ARO-DIMER-PA, is designed to silence both PCSK9 and APOC3 and therefore, reduce both triglycerides and LDL cholesterol. We hope to have initial data in Q3 2026, and that will tell us much about how powerful a drug that could be for the 20 million people in the U.S. with mixed hyperlipidemia. And we hope the first of our obesity assets could follow that.

2026 is set up with substantial growth drivers for us. We have our first commercial sales of Redemplo in the FCS patient population, and this transition to a commercial company cannot be overstated. Our Phase III studies designed to support label expansion to include a broader severe hypertriglyceridemia population should read out in Q3. We believe this market represents a multibillion-dollar per year opportunity. ARO-DIMER-PA, which, as I mentioned, is designed to silence both PCSK9 and APOC3 to treat the large mixed hyperlipidemia market, should have its first clinical readout in Q3. Our obesity franchise will continue to grow this year with new targets, including liver dimers and adipose dimers. We will also be presenting additional data from our ARO-INHBE and ARO-ALK7 studies throughout 2026.

Our emerging CNS pipeline could also be an important story. We are dosing patients in our Phase I/IIa study of ARO-MAPT. This uses our new platform that in animal studies across multiple species led to broad distribution of our RNAi molecules throughout the CNS via subcutaneous injection. ARO-MAPT targets tau, arguably the most validated Alzheimer's target and could also be used against various tauopathies. We expect to have our initial clinical data at the end of Q3. I believe we have the most productive discovery engine in the field, so this is just a narrow snapshot of what we are working on in 2026. Importantly, we have the capital, infrastructure and talent to move all these and more programs forward.

Thank you for joining us today. And I would now like to open the call to your questions.

[Operator Instructions]

So our first question comes from Prakhar Agrawal from Cantor Fitzgerald.

Hopefully, you can hear me. Congratulations on the data update today. Maybe first question on the lack of weight loss with the INHBE monotherapy arm. Biologically, what could be the reason on why the monotherapy is not seeing weight loss while you are seeing good weight loss with the combo arm, especially in the obesity plus type 2 diabetes cohort?

And maybe just a quick clarification. For INHBE, when I look at the tirzepatide combo, the Activin E reduction across the 2 MAD doses is similar, but the weight loss trajectory is a little bit different and it starts happening around week 16. So maybe if you can confirm if there were any outliers in the 400-milligram cohort asking just because it's a small sample right now?

Yes, I can take that one, Prakhar. The first part of your question, I think this is still at the hypothesis stage, but I would wager a guess that in the nondiabetics, their Activin E regulatory system is not as ramped up or as dysregulated as what we're seeing in the diabetic patients. And that may be why we're seeing more of a signal in the diabetics. That's our explanation right now. I think that probably needs to be more thoroughly tested, but that's the best answer I can give you right now for why we're seeing more of a signal in the diabetics.

Then your second question, yes, the lack of a knockdown dose response, I guess, at least based on the serum levels, it doesn't always tell us what's going on in the liver. There may be other mechanisms at play beyond just measuring the serum Activin E levels. I mean we've seen that in some of our other programs, and I'm thinking about our ANGPTL3 program, where the serum level of knockdown with dose escalation didn't really change that much, but there was a dose response for the meaningful biomarker for LDL cholesterol. So I just think there's still more that we need to sort out there.

Our next question comes from Jason Gerberry from Bank of America.

Congrats on the data. My question is just on the imaging work. I'm curious when you see such a large reduction in liver fat. Just maybe can you elaborate a little bit more the work you've done to characterize that this was fat burn and not redistributed to other tissues? And then on the DEXA scans, just wondering any work you've done to further confirm that this is an increase in lean muscle mass and not driven by any increase in water in the muscles. So just any commentary on that and just variance may be seen across -- at the intrapatient level, that would be great?

Yes, I can take the -- so first of all, we did MRI, not DEXA and we did look at -- look for changes in fat in other compartments. And what we were seeing, particularly in the diabetic cohorts was the kind of the reduction across the board in liver fat, in the subcutaneous fat, in the visceral fat as well and no increase in muscle fatty infiltration, which is one of the main reasons we looked at that parameter. So it's not like the fat was being redistributed into the muscle or other locations. And those were really the main compartments that we looked at. And sorry, what was the other question about?

Just the quality of the muscle impact. I assume that, that was more the question I was asked. Did you do DEXA for measuring impact on muscle and lean muscle and whether that was truly kind of more of an increase in muscle mass as opposed to like water increase in the muscle?

Yes, right. So we saw a modest increase in the lean mass in the healthy obese patients or volunteers rather. And then in the diabetic patients, we're still getting some of those data in. There wasn't, based on what we've seen so far, really not much of a difference in lean mass changes between the combo arm and the tirzepatide alone. But I think we're still analyzing some of that, and I think we'll report that down the road.

Our next question comes from Luca Issi from RBC. Luca, you may be on mute.

You guys hear me okay?

Yes.

Congrats on the data. Maybe just 2 quick ones for James. How are you thinking about the regulatory path from here? So assuming that this reduction in weight loss is observed only as add-on to tirzepatide, but not as monotherapy, are you planning to just get the cabo approved based on weight loss? Or are you still hoping to get maybe the monotherapy potentially approved, maybe in another endpoint like visceral stat? Like just walk us through kind of big picture, how you're thinking about the regulatory path from here to get these drugs over the finish line?

And then maybe just related, it seems this is pretty safe all the way to 400 milligrams. Is there a plan to go higher? I know your competitor, I think, are going to higher doses. So just kind of love to pick your brain on how you're thinking about potentially going to higher dose?

Yes, sure. Thanks, Luca. I think I'll take the second question first. It's something that we're discussing. We haven't decided definitively if we're going to go higher. We certainly have room to go higher based on our tox data or NOAELs. And it would be interesting to just push the dose a little more and see if you could squeeze out any more PD effect or efficacy. So we'll see. We haven't ruled it out yet.

Then in terms of the regulatory pathway, I think it still remains to be seen. We have not had any discussions with FDA or EMA about a regulatory pathway here. The pathway as a combination therapy with -- in the diabetics with the GLP-1s with an endpoint of additive weight loss, I think, seems like one of the more likely paths that we might take. But again, we'd have to discuss that with regulators and get their feedback on the details, like how much more weight loss do you need on top of standard of care.

And we'll also be -- in the Phase II, we'll also be looking at the possible use of INHBE or ALK7 as maintenance therapy. And while that could start as a combination with the GLPs, at some point, the GLPs would be withdrawn. And so at least going forward, that could be a monotherapy. Again, once the GLPs are withdrawn, that's a possibility.

And I would add one more thing. Chris mentioned this, too, that we are looking at monotherapy cohorts in diabetics, which we didn't look at in the initial SAD and MAD portion.

Our next question comes from Madison El-Saadi from B. Riley.

Congrats on this data. So we now have data from INHBE and ALK7 approaches. Wondering if there's a scenario where you may combine these or would advance both of them in separate subtype populations? And then secondly, maybe I missed it. Did you report baseline TAT, total adipose tissue?

Yes. We did not report baseline total adipose tissue in this presentation. I think we'll probably report that down the road, either at a scientific conference or another data release. In terms of the combo of both INHBE and ALK7, I'd say we haven't ruled it out yet. Of course, they're both on the same axis. So maybe you could get some additive effects. We did look at that in animals in the DIO model and really didn't see any additive effect when we combined INHBE knockdown with ALK7 knockdown, but that doesn't mean we might not study that at least in a cohort down the road.

Yes. And when you talk about combinations, we're really excited about using our dimer approach to knock down 2 genes at once with the same drug either in the liver or in adipose. And so those are also -- those combinations are quite likely going forward. With respect to whether we take both an INHBE and ALK7 into Phase II or just one of those, many of you have heard me talk over the last year about choosing one to go forward into Phase II. And right now, both are looking attractive to us. And so I think it is certainly quite possible, maybe even probable that we will continue to develop both of these at this point.

Our next question comes from Mani Foroohar from Leerink.

Congrats on the data. A couple of quick ones on sort of plans forward. I know people have talked about the diabetic versus nondiabetic dynamic. When you think about moving forward, when should we expect to see a more fulsome disclosure around baseline characteristics for various subpopulations, diabetic, nondiabetic, et cetera? And separately, when you think about moving into potentially a Phase II, a more targeted study, how should we think about the selection of the baseline tirzepatide dose moving up or down from where it is here in combination? And would you potentially move that as well as moving the dose for ARO-INHBE? Would this be a multi-arm study? Like how do you evaluate all those potential places that you could go given that you have a number of doses for 2 different agents in combination?

Yes, I can take that one. In terms of the rest of the data, I think we'll probably present that at a conference this year. We haven't decided when or where, but I think that would be the best forum for us to share the details of the baseline characteristics. Then for Phase II, we haven't really decided yet if -- how we would handle the dose titration for the GLP, if we would continue to titrate up to 15 milligrams for tirzepatide or the highest dose of semaglutide.

I think we would opt to study both of those agents in combination with ARO-INHBE, maybe others as well to see if there's any difference if it depends on the GLP used, but have not decided on how we would do the dose titration.

Okay. And as a quick follow-up, the other question that I've gotten from a number of investors since this morning when the data was released preopen, is whether or not given liver fat reduction signal, you would explore one or the other of these assets in MASH, does it make sense to have a separate MASH study? And how to think about that opportunity, if that's something that's in your strategic calculus?

It's certainly something that we thought about and actually something our KOLs have brought up and have recommended as well the liver fat reductions that we're seeing actually at both dose levels, the 400 and the 200-milligram dose levels are substantial. It's probably something you could build into a Phase II. I mean, that would be my initial take that you could do some more extensive MRI-PDFF or maybe even MRE evaluations, evaluate some noninvasive biomarkers for MASH. Of course, we probably have to do a biopsy study down the road at some point for approval. But who knows? It seems like the approvable endpoints in that indication are a moving target as well.

In any case, I think it's something that we would look at in a Phase II, haven't definitively decided if there's a separate MASH pathway for this drug as of yet.

Our next question comes from Maury Raycroft from Jefferies.

Congrats on the update. For both INHBE and ALK7 combos with tirzepatide, could you talk more about what the maintenance cohort study design would look like? And what are the doctors' expectations for what would happen with GLP-1 withdrawal? Maybe if you can comment on that. And maybe along the lines of Luca's question earlier, what are some of the precedent examples for the regulatory path that you would leverage going forward?

Yes. I think on the first one, I don't have a clear answer. We haven't definitively decided on the design of that study yet. I think we'll probably discuss the details of the Phase II designs down the road later this year. And then the regulatory precedent, I don't think there's a whole lot out there yet in terms of what magnitude of additional weight loss would need to be achieved with combination therapy? Would you have to study the monotherapy of the investigational therapy separately? So I think that still all remains to be determined when we have discussions with regulators.

Got it. And can the doctor comment just on perspective of like a maintenance use or a maintenance approach here and what would happen with GLP-1 withdrawal?

Yes. So it's unlikely that if you withdraw any one treatment, you're going to maintain all of the benefits. So -- because that's what we see with blood pressure, that's what we see with lipids, that's what we see with diabetes, et cetera. So although it's an important study to do and for us to get clarity on that, my expectation would be in the long term that we will continue with combination therapies because that's exactly what we do with all chronic diseases.

Our next question comes from Mike Ulz from Morgan Stanley.

Congratulations on the data as well. And maybe just a follow-up on the prior question for Dr. Le Roux. Maybe you can just comment at a high level on your view of this early data maybe for both INHBE and ALK7. And then I know it's early, but where do you see these assets potentially fitting into your practice? Is it more combination, maintenance, all the above?

So I would certainly think the combination approach is certainly the first thing that I would think of. And especially because it's a completely different mechanism, it's likely, as you have seen, the initial data would suggest that it's going to be additive or even actually amplify some of the benefits. Now just remember that we have very, very small amounts of absolute visceral adiposity, maybe 1.5 kilograms, et cetera, in people with diabetes. Of course, it will be more.

So it's not surprising that you don't see an overall reduction in weight loss, but you see this very impressive improvements in visceral adiposity as well as adipocytes that penetrate organs such as the liver, et cetera. And it's -- and ultimately, when we are treating the disease of obesity, it's no longer about weight loss, it's about health gain. And this is exciting because you can amplify the health gains that we are seeing already from the GLP-1 type of medications.

Our next question comes from Patrick Trucchio from H.C. Wainwright.

Congrats on the data. I guess just a couple of follow-ups from us. Just the first is, I think you said that Phase II is not gated by ongoing Phase I/IIa work. So I'm wondering what specific effect size are you powering Phase II for in diabetics? Would it be incremental weight loss, visceral fat reduction or composite endpoint? And did today's data change that assumption?

Yes, I can take that one. Patrick, I think, again, when we say that this is not gating that to me means that we're planning the studies now, designing the studies, and we'll submit those studies. I think we'll disclose the details in study design and powering down the road, probably once we submit those studies. So I can't give you a definitive answer now on that.

And just based on what you're seeing so far, would you expect an incremental benefit versus GLP [Technical Difficulty] beyond week 24? And what biological signal gives you confidence in that trajectory?

Well, I don't think we know the answer to that. It's one of the reasons why we wanted to extend the follow-up in these studies. Right now in the combination cohorts, we go out through week 24, and we'd like to amend and increase the size of those cohorts. So we get a little bit more power, a little more end there to confirm the signal and then follow them out longer, maybe through a year to see if do they plateau or do they continue to lose fat mass. Because right now, I think we just -- we don't know the answer.

Our next question comes from Andrea Newkirk from Goldman Sachs.

Maybe just a quick follow-up for Dr. Le Roux. Just based on the initial data here and the benefit observed in the diabetic subpopulation, can you just remind us what proportion of the overall obesity market this represents? And then, Chris, I'd be curious how you're thinking about continued development of ARO-INHBE or ARO-ALK7. Just more specifically, if you believe Arrowhead has the capacity to bring this forward independently? Or would you look to out-license this in some manner, either wholly as an asset or potentially even based on geography?

So maybe if I can start. So just to give you broad numbers. So in the Western world, we have about 25% to 35% of the population that have the disease of obesity. The total percentage of people that have diabetes is approximately 8% to 10%. Now that's much higher if you go to the Middle East, where the percentage of patients with type 2 diabetes can be as high as 24%, 25%, et cetera. But it's also important to understand that, especially when it comes to public payers, they are far more likely to pay for medications in people that have type 2 diabetes in comparison to people that have the disease of obesity, but don't have type 2 diabetes. So the population is smaller, but the chances for reimbursement for people with type 2 diabetes is always higher.

And regarding your question on taking this forward, we do have the capacity, and it is our intention to continue to develop these and future obesity assets ourselves. I think these are important drugs, and I think we have additional important drugs that we'll be developing in the near to midterm that we should hold on to and we should develop ourselves. The fact that at least out of the gate, this -- the obese diabetic population is a specific population and makes these -- the next level studies a bit simpler, more straightforward because it's a bit more targeted, at least initially.

Our next question comes from Joseph Thome from TD Cowen.

Congrats on the data. Maybe the first one for Dr. Le Roux. Apologies if I missed this, but what proportion of your diabetic patient population that's obese that's on a GLP-1, do you think would be interested in an additive therapy like either the ALK7 or INHBE assets? And then I know you mentioned payers as well. I guess, for combination approaches, do you expect that you would get any pushback without hard outcomes data? Or will the increased reduction in fat and weight loss be sufficient to allow for combination use? And any thoughts from either you on that or the company?

So what we see at the moment is there's about 20% of patients, we call them the enthusiasts who are really moving very rapidly to take on new medications. And you could imagine that, that leaves 80% of patients out there that's currently not taking on really good medications such as the GLP-1-based therapy. So there's a huge amount for that to grow.

But for those patients who are enthusiasts, we see that they take on new treatments very rapidly. So there's already a substantial number of patients that I think would be very interested in this. And of course, the fact that you can provide the treatment at a pretty infrequent time, that also makes it very attractive because patients, for example, when they come to clinic, they can get the medications.

When it comes to reimbursement, you are correct that it will be difficult for new medications to displace treatments with existing cardiovascular benefits and existing kidney benefits. But what we see is there remains an unmet need in that population. And as I've shown, patients with type 2 diabetes still have higher cardiovascular morbidity and mortality in comparison to patients that don't have type 2 diabetes. And I think it's that health gain that could be driven by the reduction in visceral adiposity that may be very attractive to both clinicians, to patients, but also to payers.

Our next question comes from William Pickering from Bernstein.

Congrats on the data. For ALK7, I understand you're just presenting the visceral fat data today, but could you maybe speak in qualitative terms about how the data looked for total fat and whether that measure also supports your view that ALK7 might be a better target than INHBE?

Yes. I think at this point, we don't have all the data available. So we're going to have to punt on that one, and we'll disclose the rest of the ALK7 data when it's all been sort of cleaned and analyzed probably at a meeting down the road.

I will now turn it over to Vince to close out the call.

Great. Thanks so much, and thanks, everybody, for joining us today, and we will talk soon.

Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call.

[Operator Instructions]

I will now hand the conference call over to Vince Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.

Thank you, Andrew. Good afternoon, and thank you for joining us today to discuss Arrowhead's results for its 2025 fiscal year ended September 30, 2025. With us today from management are President and CEO, Dr. Chris Anzalone, who will provide an overview; Bruce Given, Outgoing Chief Medical scientists, who will provide an overview of the REDEMPLO FDA approval Andy Davis, Senior Vice President and Head of the Global Cardiometabolic franchise, who will provide an update on commercialization activities. Dr. James Hamilton, Chief Medical Officer and Head of R&D, who will discuss our development programs and Dan Apel, Chief Financial Officer, who will review the financials.

Following management's prepared remarks, we will open up the call to questions. Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact are forward-looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statements. For further details concerning these risks and uncertainties, please refer to our SEC filings, including our most recent annual report on Form 10-K and our quarterly reports on Form 10-Q.

I'd now like to turn the call over to Chris Anzalone, President and CEO of the company. Chris?

Thanks, Vince. Good afternoon, everyone, and thank you for joining us today. Before we begin, I'd like to announce that this will be Bruce Given's final earnings call. He's been a valuable member of the Arrowhead team for almost 15 years. He will continue to help Arrowhead as a trusted adviser, but now that REDEMPLO has received its first FDA approval, he will be stepping back from day-to-day operational responsibilities. And hopefully, he can finally enjoy his time and retirement or in his re-retirement, which is probably more accurate. His contribution to Arrowhead's success both current and future have been critical, and we owe him a heartfelt thank you.

Later in the call, you will hear from Bruce who will discuss the REDEMPLO FDA approval, which he came back to Arrowhead and out of retirement to help us get across the finish line. Bruce leaves us in a strong position with a very strong group of leaders across the organization. As you all know, James Hamilton has already assumed much of Bruce's prior responsibilities as Chief Medical Officer and Head of R&D. So thank you again, Bruce, for getting us to today. And thank you, James, for taking us into the next chapter for Arrowhead.

Let's now turn to our business and what progress we've made during the recent period. This has been a very busy and enormously productive in the last few months. The most impactful change is the FDA approval of REDEMPLO. On November 18, we announced that the FDA approved our REDEMPLO indicated as an adjunct to diet to reduce triglycerides in adults with familial chylomicronemia syndrome or FCS. FCS is a severe rare disease with an estimated 6,500 people in the United States living with genetic or clinical FCS characterized by triglyceride levels that can be 10x to 100x higher than normal, leading to a substantially higher risk of developing a few recurrent and potentially fatal pancreatitis.

This is Arrowhead's first FDA-approved medicine, marking a major milestone for the company as it transitions into commercial stage. REDEMPLO is the first and only FDA-approved siRNA medicine for people living with FCS and can be self-administered at home with a simple subjeganeous injection once every 3 months. REDEMPLO was the first and only FDA-approved medicine to be backed by adequate and well-controlled studies that include patients with genetically diagnosed and clinically diagnosed FCS. After many months of preparation, our commercial team was able to hit the ground money, and I'm happy to report that we have drug in channel a mere week after approval.

We also launched rely on REDEMPLO, a patient support program, providing support services and resources for patients at each stage of the treatment journey with REDEMPLO, including financial assistance options for eligible patients. In addition, we also announced the 1 REDEMPLO pricing model that creates 1 consistent price across current and potential future indications. This is important. We are committed to sustainable innovation, and this requires a rational drug pricing according to the value of a medicine -- according to the value of medicine offers to patients and health care systems. It also means that we will not ask different patients to pay different amounts for the same drug based solely on what disease they've been diagnosed with.

REDEMPLO is a pancreatitis drug. And when we think about pricing, we look to those patient populations for a greatest risk of acute TG related pancreatitis. The patients we are serving now are also those at greatest risk of pancreatitis, people with FCS. This includes those with the defined set of mutations as well as those who share the same level of calamarnemius and symptoms but with more heterogeneous and often less well-characterized genetic backgrounds, who we refer to as clinically defined or phenotypic FCS. The broader patient population will substantially increased risk of acute pancreatitis or those with persistent colonic anemia, meaning fasting triglycerides greater than 880 milligrams per deciliter. We believe there are approximately 750,000 of these patients in the U.S. And while they often have less day-to-day symptoms in FCS patients, they are clearly at high risk for acute pancreatitis.

The NEO pricing model has these patients in mind in the $60,000 annual WACC price is designed to provide real value to patients and health care systems in this population. Our SHASTA-3 and SHASTA-4 Phase III studies are designed to support an sNDA in this population. And while those studies are ongoing and we are actively serving the FCS population, we will have time to help payers properly appreciate REDEMPLO's value and payers will have time to plan and budget for as possible eventual adoption in regulatory review and approval. Outside of REDEMPLO, we have also made good progress with 2 other pipeline programs in the cardiometabolic space, sodasiran and AeroDimer-PA. We'll start with sodasiran. During the recent period, we dosed the first subject in the [ ASEMITY ] Phase III clinical trial of zedasiran, our clinical quite candidate being developed as a potential treatment for homozygous familial hypercholesterolemia or HoFH.

HoFH is a rare genetic condition that leads to severely elevated LDL-cholesterol and early onset cardiovascular disease. [indiscernible] 60 subjects over the age of 12 will be randomized to receive 4 doses once every 3 months. of 200 milligrams [indiscernible] placebo. The primary endpoint is the percent change from baseline to 12 in fastening LDL-C. The Phase II data in this patient population were encouraging, and we hope to have this study fully enrolled in 2026, completed the study in 2027 and a successful enable an NDA filing by the end of 2027 and launch in 2028. The next pipeline program is in cardiometabolic is Aero dimer PA. During the last quarter, we filed a request for regulatory clearance to initiate a Phase I/II clinical trial of aerodimerPNA, being developed as potential treatment for atherosclerotic cardiovascular disease, or ASCVD, due to mixed hyperlipidemia in which both LDL-cholesterol and triglycerides are elevated.

This is a very large loculation without proper treatment options, we believe there are approximately 20 million people in the U.S. with mixed hyperlipidemia. Aerodimer PA is a dual-function RNAi therapeutic designed to silence expression of the PCSK9 and APOC3G in the liver, that's designed to reduce both LDL-C and TGs. This represents an important step forward for the RNA field as we believe it is the first clinical candidate to target 2 genes simultaneously in 1 molecule and an important step forward for preventative cardiology, as both LDL and TG have epidemiologic support as being important drivers of ASCVD risk.

Both these programs fit well strategically with our growing commercial focus on the cardiometabolic space and on physicians to treat these patients. Also during the quarter, we expanded our clinical pipeline in CNS. We filed a CTA to initiate a Phase I/II clinical trial of ARO MAPT as potential treatment for telopathies, including Alzheimer's is. Aeramap-T is area's first therapy to utilize a new proprietary delivery system which in preclinical studies has achieved blood-brain barrier penetration and deep knock down -- across the CNS, including deep brain regions after subcutaneous injections.

Nonclinical evaluations in monkeys with subcutaneous administration of ARO MAPT using clinically translatable doses have shown better than 75% knockdown of the tissue level NAPT mRNA in CNS. Importantly, monkey tissue level knockdown has translated into CSF tau protein reductions with duration of effect supportive of either monthly or quarterly subcutaneous dose readiness. This is an exciting program, and we look forward to initiating the study shortly. We also continue to make good progress on our first 2 obesity programs, AROIN-HBE and ARO AP-7. Together, we have randomized 192 patients, all with the BMI greater than 30. Because we started AROIN-HBE earlier, it is about 2 quarters further into the Phase I study in the -- our plan has been to share early data at the end of the year, but due to travel schedules and the holidays this will push a couple of weeks later into the early part of January.

We also expect to have more fulsome data toward the end of the first half of 2026. We also made important progress in business development. First, as we announced yesterday, we earned a $200 million milestone payment from Sarepta following the drug safety committee review and subsequent authorization to dose escalate and achievement of the second prespecified patient enrollment target for ARO DM1. This follows a $100 million milestone earned previously when Arrowhead reached the first of 2 prespecified enrollment targets and subsequent authorization to dose escalate in a Phase I/II clinical study of ARO DM1. This partnership continues to be productive, and we look forward to continued progress. In addition to progress on construction partnership, we announced a new global licensing collaboration agreement with Novartis for ARO SNCA Arrowhead's preclinical stage siRNA therapy against [indiscernible] for the treatment of [indiscernible].

The collaboration includes a limited number of additional targets outside our pipeline that will utilize Arrowhead's proprietary TRiM platform. Arrowhead received a $200 million upfront payment from Novartis and is also eligible to receive development, regulatory and sales milestone payments of up to $2 billion. Arrowhead's further eligible to receive tiered royalties on commercial sales up to low double digits. As I mentioned before, the recent approval of REDEMPLO is clearly the most important recent developments that Arrowhead has been busy across the pipeline and in business development during the recent period. Business development and licensing is critical to our business model.

So we are pleased to have these 2 significant deals closed this year.

With that overview, I'd now like to turn the call over to Bruce Given. Bruce?

Thanks, Chris. Good afternoon, everyone. I'm happy to give my final update to Arrowhead shareholders. at such an important time and with Arrowhead in such a position of strength. We have built something truly unique and powerful at Arrowhead. And with the first FDA approval behind us, it feels like the right time for me to step back into retire. So let's review some of the key parts of the recent FDA approval that we announced last week. Mostly, I'll discuss the label and information contained in the packages. REDEMPLO is approved as an adjunct to diet to reduce triglycerides in adults with FCS. The recommended dose of REDEMPLO is 25 milligrams, and it could be self-administered at home by subcutaneous injection once every 3 months. REDEMPLO has no contraindications, warranties or cautions.

The most carbon adverse reactions include hyperglycemia, headache, nausea and injection site reactions. The FDA submission was supported by clinical data from the Phase III PALISADE study in patients with both genetic FCS and those with the same clinical manifestations of disease but without solely a genetic cause referred to as clinically diagnosed FCS, the blinded portion of the trial compared a year of therapy with plozastiran or placebo dosed every 3 months and tested 2 doses of plozastriin versus placebo. The primary endpoint was change in median triglycerides at 11. There were also multiplicity-controlled secondary end points all of which were statistically significant, including notably the incurred of acute pancreatitis for which the 25 to 50-milligram doses were combined for comparison to placebo as called for in the analysis plan.

Plozastiran achieved deep and durable reductions in median triglycerides as early as 1 month when the first measurement was taken. Overall, these reductions were around 80% from baseline reductions largely maintain medium triglyceride levels below the usual guideline-directed threshold of 500 milligrams per deciliter throughout the year of treatment. 500 mg is the recognized threshold for the risk of pancreatitis increases relative to a normal population. Importantly, patients with genetic FCS versus clinical FCS showed similar reductions from baseline. We see the clinical FCS population having the same high unmet need as the genetic FCS group. And as such, we think it is crucial to have shown that both patient populations showed similar large reductions from baseline in triglycerides with REDEMPLO therapy. Plozastiran is also labeled as having reduced the rate of adjudicated pancreatitis events versus placebo, a very welcome finding for FCS patients and their caregivers and an important validation of the reductions in triglycerides can, in fact, lead to reductions of [indiscernible].

Let me close by saying that it's gratifying to have been a part of Arrowhead from the early days of our siRNA developments and part of the plozastran program and its inception and again, over the last several years. And more importantly, it's exciting to hear the enthusiasm about this new medicine for patients, caregivers and physicians. I'd also like to wish all of you an enjoyable Thanksgiving holiday.

I'll now turn the call over to Andy Davis. Andy?

Thank you, Bruce. It's been exactly 1 week since the commercial launch of REDEMPLO and the early feedback we've received from health care professionals, patient societies and payers has been very encouraging. We hear lots of enthusiasm about the differentiating attributes of REDEMPLO, which generally fall in 5 value pillars, some of which the team has touched on briefly already. First, the reduction in triglycerides is both significant and sustained. In PALISADE, REDEMPLO reduced triglycerides by an unprecedented minus 80% from baseline as early as month 1 and maintain this marked production with minimal variation throughout the full 12-month treatment period. .

This compared to a minus 17% reduction in the pooled placebo group. With REDEMPLO, patients now have real hope many for the first time of achieving triglyceride levels below guideline-directed risk thresholds associated with acute pancreatitis such as 500 milligrams per deciliter. In PALISADE, 50% of patients at the 25-milligram dose achieved TG levels below 500 milligrams per deciliter with approximately 75% achieving levels below 880 milligrams per deciliter at month 10.

Second, the numerical incidence of acute pancreatitis in patients treated with REDEMPLO was lower compared with placebo. As we all know, this is the outcome of most importance for health care professionals, patients and payers. Third, REDEMPLO demonstrated favorable safety and tolerability, importantly, the U.S. approved package insert contains no contraindications, no warnings and no precautions associated with the use of REDEMTILO. Fourth, REDEMPLO can be self-administered at home with a simple subcutaneous injection once every 3 months, just 4 injections per year. Physicians tell us this infrequent dosing schedule is likely to reduce the treatment burden on physicians, patients and caregivers.

And fifth, early feedback on the 1 REDEMPLO pricing model has been positive. As Chris highlighted, this model creates 1 consistent price $60,000 per patient per year across current and potential future indications such as severe hypertriglyceridemia. Again, this means that we will not ask different patients to pay different amounts for the same drug based solely on what disease they have. We have been in important discussions with payers and early signs for market access are encouraging. As a reminder, we believe there are an estimated 6,500 people in the U.S. living with genetic or clinical FCS and the prescriber base comprises specialist physicians such as lipidologists, endocrinologists, preventive cardiologist, and internal medicine physicians with a focus on lipid disorders.

These specialists often operate within multidisciplinary teams that may include gastroenterologists, advanced practice providers and specialized dietitians. At launch, we are targeting approximately 5,000 health care professionals through personal engagement. And finally, our rely on REDEMPLO patient support program is operational and designed to make every step of the journey easier. This program is designed to assist patients and physicians with insurance verification, financial assistance options, a first dose starter kit and supplemental injection training. We launched just 1 week ago, but our care coordinators are already actively processing REDEMPLO start forms, conducting patient welcome calls and engaging payers to obtain approvals.

And as Chris stated, we're happy to announce that we already have drug available in channel ahead of schedule.

I will now turn the call over to James Hamilton to discuss the broader R&D portfolio. James?

Thank you, Andy. I'd like to give a quick review of the status of our late-stage Phase III studies and also describe the design in a couple of our early stage programs. Let's start with the suite of Phase III studies of [indiscernible] designed to potentially support supplemental NDA filing to expand the label beyond genetic and clinical FCS. Chester 3 and Chester 4 are Phase III studies designed to compare reductions in triglycerides with 25 milligrams plus aspirin compared with placebo over 12 months of treatment. Between the 2 studies, we enrolled approximately 750 patients.

In addition, the [ NIR III ] study enrolled approximately 1,400 patients. This study in patients with mixed hyperlipidemia is designed to supplement the safety database when we file an sNDA for plazasiran in severe hypertriglyceridemia. We are not planning to seek approval in the mixed hyperlipidemia patient population. We completed enrollment in the global SHASTA-3 and SHASTA-4 as well as mirror 3 Phase III clinical studies in June of 2025. We anticipate completing the primary portions of these studies in mid-2026, with top line data expected in the third quarter of '26. If successful, we plan to make submissions before the end of 2026 for regulatory review and potential approval. The SHTG program also features a study named SHASTA--to directly assess the ability of plozasciran to reduce the risk of acute pancreatitis as the primary endpoint in SHTG patients at high risk of acute pancreatitis.

We are currently enrolling patients in that study. Of note, we will also be assessing pancreatitis risk reductions in SHASTA-3 and SHASTA-4, a key secondary endpoint, but SHASTA-5 is the first event-driven study to assess acute pancreatitis as the primary endpoint. I'd also like to provide an update on our obesity programs, [indiscernible] and ARO-LK7. Both of these programs target the known activin pathway that is involved in signaling to adipocytes to store effect. [indiscernible] inhibits 1 of the ligands in the pathway of ARO-LK7 antidote receptor on the advocate that these ligands bind. So essentially, we are trying to reduce the message sent to store fat and the way the message is received at [indiscernible]. [indiscernible] started enrolling patients in December 2024 and Arrow ALK segment initiated in May of 2025. Both programs are currently in Phase I/IIa first-in-human dose escalating studies to evaluate safety, tolerability, pharmacokinetics and pharmacodynamics. Both programs include Part 1 designed to assess single and multiple doses as monotherapy and part 2 is designed to assess multiple doses in combination with [indiscernible].

As [indiscernible] started about 2 quarters earlier, we have more mature data in that study. The study is nearly fully enrolled, and we are on schedule and currently planning to share initial data from this program around the first week of 2026. This is a rather robust first-in-man study that's collecting multiple measures of drug activity and pathway activity, and we are eager to share initial findings. We were originally planning on sharing first data around the end of the year, but due to the holidays and travel the first week of January were the best for all schedules.

For ARO-ALK7, we intend to provide a brief snapshot of early safety and target engagement results from that study. Both targets have strong genetic validation in both programs have yielded promising results in preclinical studies. So it will be interesting to see similarities and differences in patient response in clinical trials.

I will now turn the call over to Dan Apel.

Thank you, James, and good afternoon, everyone. I'll provide a brief outline of our financial results. As we reported today, our net loss for fiscal year 2025 was $2 million or a loss of $0.01 per share based on $133.8 million fully diluted weighted average shares outstanding. This near breakeven result compares with a net loss of approximately $599 million or loss of $5 per share based on $119.8 million fully diluted weighted average shares outstanding in fiscal year 2024. Revenue for fiscal year 2025 totaled $829 million and was driven entirely by our license and collaboration agreements with Sarepta, Sanofi and GSK. Of the $829 million, roughly $697 million pertaining to the Sarepta arrangement of that $697 million $587 million relates to the ongoing recognition of initial Sarepta consideration, ending $4 million relates to the achievement of the first DM1 milestone and $16 million related to the reimbursement of current collaboration program costs.

[indiscernible] the license Sanofi for Greater China went to Plan contributed $130 million to our fiscal 2025 revenue. And lastly, to round things out, we recorded $2.6 million earlier in the year related to a milestone payment under the GSK HBV agreement.

Turning to expenses. Total operating expenses for fiscal year 2025 were approximately $731 million compared to $605 million for fiscal 2024, an increase of $126 million. The year-over-year increase was driven by $101 million of R&D expenses and $25 million of higher SG&A costs. both of which I will explain in brief. The key drivers of research and development spend included costs to run our clinical trials, our clinical manufacturing costs as well as expense expenses related to active programs in the preclinical stage. 2025 R&D costs were heavily impacted by our base 3 clinical trials for [indiscernible] and SHPG. It's worth noting that in fiscal year 2025, nearly 2/3 of our clinical trial spend can be attributed to the late-stage development of [indiscernible] and SHTG.

As we have mentioned, the SHTG registration of studies are now fully enrolled, and we expect data to read out next year. Accordingly, the majority of remaining Phase III registration of clinical trial costs are expected to occur over the next 12 months. Our SG&A costs increased by $25 million year-over-year, driven primarily by our preparations for the commercialization of REDEMPLO. All of us here at Arrowhead are enormously proud of the capabilities we have built to commercialize REDEMPLO, not only in our commercial function, but also across regulatory, supply chain, order to cash and indeed, across all of our enabling support functions.

Turning now to cash flow. Net cash provided by operating activities during fiscal year 2025 was $180 million. compared with net cash used in operating activities of $463 million in the prior year for a net positive change year-over-year of $643 million. This increase in cash from operating activities was driven by cash received from licensing and collaboration agreements, partially offset by the aforementioned increase in R&D and SG&A costs. Turning to the balance sheet. Our cash and investments between the available-for-sale securities totaled $919 million as of September 30, 2025, compared to $681 million as of September 30, 2024. The increase in our cash and investments was primarily related to our licensing and collaboration agreement with Sarepta, Sanofi and GSK partly offset by our ongoing cash burn.

Our common shares outstanding as of the end of the quarter were $135.7 million, down $2.4 million from the prior quarter due mainly to the repurchase of shares from Sarepta. I use this opportunity to reiterate 2 developments that are subsequent to the fiscal year and meeting up today, which were financially meaningful for Arrowhead and our balance sheet. Firstly, as Chris mentioned earlier on the call, we announced a licensing and collaboration agreement with Novartis for ARO SMTA. Arrowhead's precritical stage SI RNA program targeting alpha to [indiscernible] for the treatment of synucleinopathies such as Parkinson's disease. Novartis will also be able be to select a limited number of additional collaboration targets outside of Arrowhead's current pipeline to be developed using our proprietary trim platform.

The closing occurred last month, and we have already received $200 million in the bank as an upfront payment. As a reminder, we also go to receive up to $2 billion in future milestone payments from Novartis as well as royalties on commercial sales. Secondly, in just yesterday, we announced, we earned our second development milestone under the Sarepta collaboration ARO-DM1, as Chris mentioned, this trigger a $200 million obligation from Sarepta that will be recorded in the first quarter of fiscal 2026, and we expect to receive the cash in January of 2026. This is, of course, additional to the $100 million earned for the first DM1 milestone in fiscal quarter 4 2025.

Finally, we are not providing detailed financial guidance at this time for the coming fiscal year. beyond reiterating that while we view the launch of REDEMPLO as a truly transformational event for the company, we do not anticipate that the commercial sales of REDEMPLO will have a substantial impact on our financial statements in fiscal year 2026. We also believe our cash runway even in the absence of any further capital from new deals or other sources and all the while funding a broad ambitious set of commercial clinical programs to be sufficient to extend into fiscal year 2028.

With that, I will now turn the call back to Chris.

Thanks, Dan. Arrowhead has been working to bring important medicines to patients in need for over 15 years. As Bruce mentioned, it's very gratifying to see REDEMPLO approved by the FDA and the overwhelmingly encouraging feedback we received from the FCS community. While REDEMPLO is just 1 part of a large pipeline that we've created to help potentially millions of patients in a diverse set of disease areas. We spent years building the TRiM platform to enable us to bring RNAi where it is needed. We are now able to address 7 different cell types and have current clinical programs in 5 of these.

Further, we will meet our 20 and 25 goal, whereby we will have 20 individual drugs candidates in clinical trials by the end of this year. Our partner has been helpful with judicious with approximately half of our clinical pipeline wholly owned and have partnered. We have late-stage studies ongoing, again, both independently and with partners that may potentially lead to multiple new commercial loans over the next few years. In addition, we have a strong financial position that enables us to properly invest in our growth today and in the future. We believe we now have everything we need to be in the next class of large and ultimately profitable biotech companies.

Thanks for joining us today, and I would now like to open the call to your questions. Operator?

[Operator Instructions]

Our first question comes from the line of Luca Issi with RBC Capital Markets.

Bruce congrats in your re-retirement, I should say, all the best in your next chapter. And then maybe if I can stick with you. Can you just maybe talk about what's the plan to show a benefit in terms of acute pancreatitis for plozasiran? Are you confident just the 3 and 4 in Q3 2026 can actually hit acute pancreatitis? Or is the base case scenario, those 2 trials are maybe under power to show a benefit, you actually need [indiscernible] 5 to actually hit on acute pancreatitis, even I was a depopulation enriched for [indiscernible]. The only reason why I'm asking is it looks like you doubled the size of the end, I should say, in the SHASTA-5 trial according to click[indiscernible] as of Monday last week. So again, any color there, much appreciated.

Sure, Luca. And thank you for your kind regards. SHASTA-3 and 4 were powered on the basis of triglyceride reduction, which is the primary endpoint. So we did not specifically powered SHASTA-3 and 4 for pancreatitis. However, it was on our mind and as was also done in the core studies, there is the intent and by design, the capability to cool both SHASTA-3 and 4 for evaluating versus placebo on reduction of pancreatitis. And of course, we only have 1 dose of plozasiran instead of 2 doses -- 2 different doses like we had, for instance, in the Phase II program.

So there's, I would say, reasonably good power for seeing a difference in acute pancreatitis, but we're not dependent on it because we've designed SHASTA-5 specifically to obviously be able to have a primary endpoint of acute pancreatitis. We did change the design in SHASTA-5 recently to making a more generalizable population in patients with persistent [indiscernible] and a history of pancreatitis, the original design was a much more enriched population, but it would have actually been less representative than the duly designed trial. So it's not so much a matter that we've increased power so much as we broadened the power the patient population to be more inclusive of the high-risk population in SHTG.

So we certainly -- we often times refer to it as a [indiscernible] approach. There's obviously a decent chance that we will show statistical significance in the SHASTA-3 and 4 programs, but we're not entirely dependent on that because of SHASTA-5, which is a study, the first is can specifically designed to demonstrate a benefit versus placebo in acute pancreatitis.

One moment, please, next question comes from the line of Prakhar Agrawal with Cantor Fitzgerald.

Congrats on the quarter as well as the updates throughout the quarter. Maybe on the obesity side, I had a couple of questions. So on 1 for the update early next year, if you can just provide more details on how much data will be disclosed, especially on the mat side. And how much follow-up will you have on NME for both monotherapy and combo cohorts? And also the same question on [indiscernible], what cohorts will be disclosed and will there be any weight loss data at all from [indiscernible] early in the year?

Yes, sure. Prakhar, this is James. I can cover that. For [indiscernible] is a little bit ahead, as Chris mentioned, probably by a couple of quarters. So the study is nearly fully enrolled. We have a good amount of data in both the SAD and MAD healthy volunteer or obese healthy volunteer cohorts. So we'll have biomarker data, MRI data as well as safety in those cohorts. And then the combo cohorts are almost fully enrolled. I think we're waiting on a few more diabetic patients to enroll the highest dose combo cohorts, and that should have probably not through end of study but ample post-dose follow-up and both the diabetic and the nondiabetic cohorts from [indiscernible]. And then ALK 7 will be a little bit more limited, focused mostly on monotherapy, safety and knockdown data -- knockdown of target for that study.

Yes. And keep in mind here that we want to present data that are interpretable, and we're not going to have all cohorts. We're not going to have all patients -- all patient data in all cohorts even if they're fully enrolled, we don't get data in real time necessarily. And so you'll have probably 2 bites of the Apple maybe 3 bites, but certainly 2 bikes or the Apple. Our goal here in dispersed log data is to give you an idea about how these are going and then the fuller store should come out once we have the more fulsome data set in the later in '26.

Our next question comes from the line of Maury Raycroft with Jefferies.

Congrats on the progress and best wishes, Bruce in retirement. I was going to ask a follow-up to Luca's question earlier. We're expecting to see the patient baseline profile for your SHTG pivotals next week. What are your estimates on AP events accrual based on your patient's baseline characteristics? And also your change in plans to broaden AP adjudication criteria.

Maury, I think it's a little bit hard to answer the question just because we have adapted our protocols now to go ahead and adopt the -- to modify Atlanta criteria since those have been accepted by both FDA and EMA and here in the U.S. at least payers, and this is really going to be our first experience with using that particular scale, which makes it a little hard to estimate exactly how many events we will have. So it's hard to say. What you will see next week is you will see the percentage of patients that had a history of pancreatitis that were enrolled in the study. And based on that, that, I think you'll see that there's a good chance that we'll have the necessary number of events. But I'm a little bit uncomfortable trying to give any real predictions when we're using a scale that we haven't used before.

Our next question comes from the line of Jason Gerberry with Bank of America. .

This is Gino on for Jason. Congrats on all the progress this quarter. Just a couple from us. I guess, first on your Aero MAPT program. Can you maybe just discuss which aspects of the drug is differentiate from -- recently failed anti-tau antibody and what kind of still gives you the confidence in the target after the failure? And then just kind of based on your current cash position and the progress that you've made on these partners -- partnership milestone triggers, do you have any maybe updates on your visibility on launching a CVOT study? Is that more tied to kind of seeing how the FCS and potential TG launches are progressing? And then can you just remind us like any potential milestone triggers from the Sarepta programs that you're expecting in 2026?

All right. I [indiscernible] 3 questions. James want to take the first 1.

Sure. Yes, I'll take the first 1 on the MAPT program. So the J&J antibody, the monoclonal as well as other monoclonal our IV administrative monoclonal antibodies, probably a small fraction of those molecules across the blood-brain barrier and then are primarily focused on binding to extracellular hotel that's been released for damaged cells or has been secreted and that can propagate and find it to tau outside of the cell. Our approach is very different. We use a targeting ligand to facilitate delivery of the siRNA across the blood-brain barrier into the neuron and silence the expression of tau. So we're sort of turning off the faucet for all of the expression in preventing the [indiscernible] to form in the first place.

So we should get that, over time, be able to reduce the level of intracellular tau and extracellular towers the monoclonal antibodies are really just able to get the extracellular panel. So that's the key differentiator.

And on the other 2 questions, I'll answer the last 1 first, the [indiscernible]. So we are eligible to receive the first of $50 million annuities in February. So what that the next several months. That's correct, February, right, Dan.

Yes.

On the visibility on the CVOT. So that's CVOT AS you know, is for the dimer. That's a big opportunity for us. And so we are moving as quickly as we can to that so we'll have a good idea, I think the summer if we have a drug. We'll know PCSK knockdown. We'll know APOC3 knockdown, no LDL decreases will -- triglycerides. So given what those data look like, I think, again, as early as this summer, I think we'll know if we have something that really could be an important treatment is mixed hyperlipidemia patients.

Should that be successful, should now look good, we are not waiting on anything to start those studies other than finishing the Phase I/II. Our plan is to be able to roll directly into pivotal studies after the Phase I/II studies. Again, should they all go well, and there's nothing gating there other than the data looking good. We also are hoping to have parallel pivotal studies, 1 that will be a CVOT and 1 that we'll be looking at simply lowering LDL over the course of the year. As you know, that has been an approval endpoint in the past for PCSK9 inhibitors and we think that could be a good way to get to market very quickly and frankly, help us to pay for the CVOT. So that's our plan now. We'll have a much better idea about how quickly we can move in the summer time once we start to see those data. We're really looking forward to seeing those data.

Our next question comes from the line of Edward Tenthoff with Piper Sandler.

Great. And Bruce wishing you all the best and James wishing you all the best [indiscernible] really is a super exciting time for the company. I wanted to get a sense just with respect to upcoming data readouts next year, specifically asking, do you think you'll have your first look from the Aero dimer PA next year? And what other data sets beyond the obesity data in the first half, should we be thinking about?

Thanks, Dan. We have a bunch of, I think, potentially a very interesting data readout throughout 2026. As you mentioned, obesity will be the first. As I mentioned, we should have 2 bites on an Apple or thereabouts. We'll have our first early data set in the very first part of January. And then as the data mature in both those programs stay towards the end of the second quarter, something around then, we'll have a much larger data set. We think those are important. In the summertime, we expect to have dimer data.

We think those are extraordinarily important. The idea that we might have a drug candidate that can simultaneously the lower LDL and triglycerides to treat the 20 million or so people in the United States with mix hyperlipidemia is a very exciting opportunity. And again, I think we'll know if we have something that could really fit there in a summer time. Also in the summertime, I think we'll have our first bit of AeroMaP-Ddata. We'll be looking for tower levels in that also would be extraordinarily exciting. We can be at once sitting on 1 of the most exciting potential Alzheimer's drugs in the clinic.

And hopefully, we'll be derisking the entire blood barrier platform that can enable us to treat a variety of CNS diseases. And so that's an important readout, of course, also in the third quarter or so. We expect to have the readout for SHASTA-3 and 4 that are designed to enable the RS NDA by the end of the year. And then, of course, at the end of the year, we expect to have file our NDA. So look, there will be other things happening during the year, but those to me, like the primary ones and be in the market -- to the margin, and we will be really looking forward to seeing how the adoption curve that REDEMPLO is going to have.

Great. Any update on [indiscernible], just to be comprehensive.

Yes. Thank you. Yes. So as you know, Ed, the data so far for [indiscernible] has been enticing we've seen that we can knockdown raise deeply, both looking at circulating biomarkers as well as tau. That's super interesting, where we've struggled is looking for biomarkers to show potential clinical benefit. And so rather than running directly into a large asthma or COPD Phase II, we were hoping to have a baby step to see some evidence of that. And so we have started a challenge study I don't expect to have data in '26, maybe at the very end of '26, but we've just started that. And so my hope is that, that will show us that knocking down range is an important thing.

Look, it's been an undrugged target for some time. And now we can drug it. So now let's see let's see what that does for us. I think at the end of that, we can then ask ourselves, do we want to build out a pulmonary franchise or do we want to partner that. And I think a positive challenge study readout would allow us to partner that in attractive -- under attractive terms.

And our next question comes from the line of Mani Foroohar with Leerink Partners.

Congrats on the progress on the first product launch and best wishes also to Bruce on his re-retirement, does something tells me you're going to pop up again soon. I don't think you're done with us. I propose the question, can I -- I want to follow up on sort of the broader pipeline. I know Ted touched on new Arrowhead study, et cetera. How do we think about Arrow dimer application in terms of pursuing CVOT and the right target for that technology? And where are the right places for you to put that to work now that you've got sort of a very different place in terms of your balance sheet?

Actually, Bruce, do you want to take where that can fit.

Yes, I'm happy to take that. Obviously, we're excited about plozasiran and [indiscernible] inhibition generally for patients with severe hypertriglyceridemia, that's been essentially very, very poorly treated population for a long time. LDL, the LDL side of the equation, on the other hand, has been really a different story. And other than HOFH, there is a pretty good number of tools in the tool chest for dealing with LDL, the patients on that LDL side of the equation, especially patients with heterozygous familial hypercholesterolemia, which is a pretty good size population for instance. But the 20-some million patients in the U.S. alone that have mixed hyperlipidemia has been an interesting population. We could address the LDL part.

We've done really a terrible job historically of being able to address the triglyceride piece of that and the [indiscernible] analysis that have been done of CVOT has shown that for the same LDL reduction, you can really rank order the risk that patients have by how high the triglycerides are. And of course, the Mendelian randomization data has also said that triglycerides are independent predictor of events and mortality in that mixed hyperlipidemia population, it is huge. It's a very good population. So there's never really been a very good way of addressing both sides of the problem in mixed hyperlipidemia, both the LDL and the triglycerides.

And here, we're talking about a drug that could potentially do it with a single, say, quarterly injection, get both their LDL and their triglycerides probably on top of the statin. I think you're going to always have a statin there at the patients can tolerated. But you could have a daily staff at a quarterly dimer injection and potentially treat that 20 million patients to low risk levels of LDL and triglycerides that would be quite an amazing opportunity, I think, from a marketing perspective compared to what you can do today, which is you can probably get the LDL taken care of today, but you probably can't do much at all worthwhile in the triglycerides. So this is what makes this to us such an interesting proposition.

Yes. As you know, Mani, what we used to our former strategy was to make plozasiran and REDEMPLO drug. Step 1 is FCS, step 2 and HCG, step 3 after CVOT would be this -- would be to be part treatment in mid hyperlipidemia. Once we were able to perfect at least in animals, the dimer platform. It didn't make sense longer. We like the idea of keeping depo as a pure-play pancreatitis drug, full-stop. And now I think we'll have a tool to more completely treat that next hyperlipidemia population should this time translate well from animals to humans.

That's helpful. And as a follow-up, when you think about potential dimer applications, et cetera, how are you thinking about the data next year from Horizon and potentially applications of combining what hopefully will be a validated LP(a) target with other approaches to risk elevating elements of a lipid profile.

Yes, sure. So of course, our siRNA targeting a is partnering with Amgen. So we would have to work with them on any kind of dimer applications. But there are other applications beyond, of course, the PCSK9 and AOCI. I mean we're looking at other dimers in the CV space, both turning the [indiscernible] and extra hepatic cell types. So this is probably not the only dimer that you'll see out of Arrowhead.

Our next question comes from the line of Patrick Trucchio with H.C. Wainwright.

Congrats on the progress. I have a few follow-up questions. Just the first is just regarding REDEMPLO. I'm wondering if the FDA has provided clarity on what level of pancreatitis evidence will be required for a future of pancreatitis risk reduction claim in the -- particularly in the high-risk SHTG patient population. And separately, I'm wondering if there's been discussions around potential pediatric pathway just given SCF presents in childhood. And then just a follow-up on the MAPT program. I'm wondering what level of CSF tau knockdown or biomarker response would you consider clear clinical proof of concept in humans, just given I think you have greater than 75% knockdown in the NHP data.

Bruce, let me take the first and then take that to you.

So the [indiscernible] level of AP that we think the FDA is required to have it on the label. .

Yes. We have that discussion with the FDA specifically what it would take to get a claim per se. I'm not sure we really felt that was necessary. I mean I think physicians have no real question about the relationship of triglycerides to pancreatitis risk, especially now that it's been has been proven. And payers haven't seemed to be concerned about that either at least in the U.S. So I'm not sure what the value of a claim would be. It's -- and of course, at this point, it's untested whether the agency would consider providing that claim I don't know that we've really thought of it as being necessary Patrick, to be clear.

In FCS. But Patrick, is your question on SHBG or FCS.

It's around actually the high-risk SHTG patient population?

Yes. But the answer is the same, I think. We at least have not approached asking that when they give a claim, what it would take to get that claim. It's very possible that what they would require is something like SHASTA-5. But the SHASTA-5 was really designed primarily on the possibility that the payers in countries outside the U.S. might require an actual dedicated outcome study. So it was more payer focused than it was regulatory focus. And we really were not committed 1 way or the other about whether it be submitted to regulators asking for a label change. We were more interested really in protecting the possibility that there would be payers outside of the U.S. that would require a specific proof of proof of concept in a dedicated study.

So we really haven't raised this with regulators anywhere on a global basis at this point.