Hello, welcome to the Life Sciences Virtual Investor Forum. On behalf of OTC Markets Group and our co-host, Zacks Small Cap Research, we're very pleased you have joined us. The next presentation of the day is from aTyr Pharma. Please note, you may submit questions for the presenter at any time. You can also view a company's availability for a one-on-one meeting by clicking Book a Meeting. At this point, I'm very pleased to welcome Sanjay S. Shukla, President, Chief Executive Officer, and Director of aTyr Pharma, which trades on the Nasdaq under the symbol ATYR. Welcome, Sanjay.
Hi, Greg. Thanks for the invitation, happy to be here. I'm coming from San Diego, where aTyr is located. Today I'm going to talk to you how we're advancing our platform biology, going to be focusing on our lead candidate, efzofitimod, which is being studied, and has been studied for the last several years in a rare lung disease called pulmonary sarcoidosis. Next slide is some of our forward-looking statements. I won't read that here. aTyr is advancing, as I said, a platform around an ancient class of enzymes that exist in all of our bodies. These are called tRNA synthetases, these enzymes help us conjugate a reaction between a tRNA and an mRNA, basically serving as shepherds for a specific amino acid as we build out our genetic code.
What our founder, Paul Schimmel, discovered when he founded the company out of Scripps was that these enzymes play a very different role when they break apart into fragments, it's these fragments that help our bodies control inflammation and fibrosis. One of these fragments we advanced into the clinic years ago, that forms the basis of efzofitimod, those two yellow in that schematic there. These are the fragments that we've attached to a human IgG to create a drug that has been quite useful in establishing proof of concept in pulmonary sarcoidosis. This is a novel immunomodulator that has advanced into phase III, I'll talk to you about some of the phase III data that we read out last September.
We recently had an FDA meeting where we have charted out a course for our next phase III trial, which we hope, once we complete, will lead to the first therapy ever approved for sarcoidosis. In addition, we have a fibrotic drug in preclinical discovery stage that is called ATYR0101. That is a different fragment that seems to modulate fibrotic cells, quite effective as maybe a true anti-fibrotic. I'm not going to talk too much about that today. We have a large IP platform that ring-fences this synthetase class of biology. We're the only company, the leading company in this tRNA biology space, we're in a good cash position. We have about $70 million in cash as of our last filing. Next slide. Let's talk about sarcoidosis.
Sarcoidosis is a large orphan disease, a quite serious condition that stems from a pathology where clumps of immune cells cause granulomas, and these granulomas exist largely in the lungs. Many of you are right now in New York. Most of the 9/11 workers who cleaned the debris down in Lower Manhattan suffered from sarcoidosis as they developed this overwhelming inflammation and fibrotic lung disease. That was sarcoidosis. The leading clinician, David Prezant, works with FDNY in Brooklyn. He saw a massive spike of firefighters getting sarcoidosis in 2001, 2002. Although we don't know the exact cause, it's probably an inflammatory response to some sort of external stimuli, like all that toxic matter. Nonetheless, it's a disease that afflicts almost 200,000 patients in the U.S. alone. It's more common than we think. A bit more prevalent in the African American population.
We're not exactly sure why, a number of celebrities, unfortunately, have been afflicted with sarcoidosis. Bill Russell for the Celtics, for example, lived with sarcoidosis for many years. Bernie Mac, the famous comedian, also struggled with sarcoidosis. Most of these patients, unfortunately, don't have good therapies, and they progress to become quite fibrotic, and that lung fibrosis is ultimately what leads to morbidity and mortality for these patients. Large unmet need because the drugs that are used, steroids, and a lot of the off-label immunosuppressants are quite toxic, and they cause really debilitating quality of life. One of the great things about our therapy is it's the only therapy in the last 70 years that has improved quality of life in cough, shortness of breath, fatigue. All of the measures that people want to feel better, the drug is actually already proven to do that.
There's a large commercial opportunity because this is a large indication, but there's about 200 other interstitial lung diseases without a good therapy. We view this as a large, almost a $5 billion opportunity, with efzofitimod. Next slide. Much of our science has been really well vetted and understood. Our mechanism of action works through a receptor that modulates certain immune cells in the lungs called macrophages, and we were one of the only biotech companies that published and had a landmark publication last year with a cover on the "Science Translational Medicine." This is a premier translational medicine journal. When I've worked in larger pharmas like Roche and Novartis, we tended to dominate this journal. It's a testament to aTyr's research capabilities here in San Diego that we were able to land this landmark journal.
This was necessary also for many of the pulmonologists and clinicians when they think about a novel therapy working on tRNA synthetase, they wanted to learn the exact mechanism. We've already validated that, and this is a journal for those of you that like science, you can read on your own time. Next slide. We recently finished a large phase III trial, and this was a trial where we conducted the first ever phase III trial called EFZO-FIT in this indication, pulmonary sarcoidosis. This was a trial where we were looking to really establish could the drug reduce steroids or get people off steroids? At the same time, we also wanted to look at quality of life.
There had never been a trial that attempted to get people off steroids until EFZO-FIT. We were the first company to have a really aggressive steroid taper that looked to replace steroids with efzofitimod. The goal here was to show a difference in how much steroids people needed, but also look at the quality of life of these patients. We conducted this study in about 90 centers in nine countries around the world, a massive accomplishment. We expect to publish this in a major medical journal shortly. This is some of the data that we presented in Amsterdam last September that I am going to talk you through. We did not hit our primary endpoint. This was actually a real important moment for us. We were hoping to see steroid reduction with our drug. We did. We reduced steroids 70%, 80%.
Unfortunately, it did not show a statistically significant difference to placebo. This was really surprising to us, the patients, and also the worldwide experts. Never before did they think that placebo patients would be able to manage on prednisone with significantly less than what we showed here. The view was, we might be able to get these people down to about five milligrams a day. Most of the patients came in north of 10 milligrams. The amount of decline and the amount of steroid reduction we observed in the placebo population is now leading to treatment guidelines being updated. Although we were not successful, patients now worldwide, we have proven you can live on a lot less steroid. Part of the reason we did not hit our primary is that placebo 40.2% steroid free. Experts estimated we would see no more than 10%-20%.
That 40% is much larger than has ever been observed. Nonetheless, we have to live by the fact that the data is telling us we do not actually see a difference, even though the drug was performing exactly like we wanted it to. The next slide gets into some of the quality of life that we saw. Why do we believe in the drug activity? Well, when you look at cough and shortness of breath with this measure called the KSQ-L, this is a validated symptom score of cough and shortness of breath. We are showing highly statistically significant differences, but not just at week 48. If you look at this curve, the top curve, the solid green line, that is the five milligram dose, and the dotted line below is the placebo.
The important thing here is to note that at really every time point after week eight, we are seeing separation, and that separation is statistically significant. From a drug development standpoint, you want to see durable, consistent improvement, and these patients have cough and shortness of breath improvement at week eight that is statistically better than their placebo counterparts. That was our first strongest sign of drug activity. If you look at other quality of life measures like fatigue and also looking at general health like aches and pains, joint ache, these patients have a lot of fatigue because the inflammation is actually not just in the lungs. There is a lot of bone pain because you have activated myeloid cells that really come from your bones. Again, we see the same thing. Highly significant improvement in how patients feel really at all time points after week eight.
This is really the first time and the first therapy that's ever improved quality of life, and we're doing it with three very different measures, seeing it over and over again at every time point after about week eight. This is why the experts say, "Look, the drug is clearly showing clinical benefit. Maybe you didn't pick the right endpoint, and this is what you should think about changing in the next trial." Lastly, I'll end here by looking at forced vital capacity. This is important because in a trial where you remove steroids, you expect to see a little bit of decline with forced vital capacity. The FDA wanted to make sure people weren't bottoming out, and we didn't see that. We saw about a 1%-2% decline. That's expected.
Drug worked a little bit better than placebo. One thing I want everyone to pay attention to is in sarcoidosis, we enrolled what's called an all-comers with pulmonary phenotype, meaning people that had upper airway inflammation, lower airway inflammation, mixed inflammation. Depending on how you present with your pulmonary function testing, your scans, sarcoidosis is something that presents with different types of subgroups. We enrolled them all. Want that to stick in everyone's mind because I'm going to come back to FVC because frankly, this is a measure that should be really looked at in a restrictive phenotype. Next slide. Safety. This is really important. We're trying to replace a lot of toxic off-label therapies. The drug was generally well-tolerated. We've seen that in phase II. We've seen that in healthy volunteers. We've seen that in animal studies. AEs were mostly mild to moderate.
You don't want to replace toxic therapies and offer a new therapy to patients where they have to deal with a new safety finding. I'm very happy with the safety profile thus far. We start to see very little to no SAEs, and certainly these are not in any way highlighted a bit more in the drug versus placebo. I expect the drug to continue to have good safety findings in the next trial. We went to the FDA back in April. We presented this publicly in May. The key thing here is, do we have a pathway forward? We certainly do because the drug has activity. The question became, okay, we've blown out steroid reduction. We've changed the field for patients. Now what should we focus on in the next trial? The view was forced vital capacity should be the primary endpoint.
If FVC is going to be the primary endpoint, we really now need to start to look at a sensitive, sicker population that is amenable to FVC improvement, similar to the IPF and the progressive pulmonary fibrosis drugs that have approvals already. Working with a number of regulatory experts around the world, including former FDA commissioners, we basically formed a plan for the next trial, where there's a few tweaks, but we are going to be looking at a sicker, more restrictive population. What do I mean by restrictive? The next slide starts to get into these phenotypes. Many of us have a normal pulmonary function test, in which case our ability to move air in and out with our upper airways and also squeeze our lungs, that's all preserved. Restricted patients have problems with that second component, being able to squeeze your lungs.
You can move air in and out, but you have a hard time squeezing your lungs. You're restricted. Obstructive patients, this is normally patients who have things like asthma or COPD. Your upper airway is just basically obstructed. It's tighter. Think of a smaller straw. Your lungs are working well, but you can't move air in and out. You have to look at different phenotypes and pay attention to the endpoint that you're researching. If you want to look at FVC, you really have to focus the population to those restricted patients because they have FVC impairment. If you were focusing on upper airway, you'd look at something called FEV1. When we talk to the FDA, one of the key questions is: What do you see in the restricted patients in your last trial? Because we're leaning towards going towards FVC.
This is where we start to see something rather dramatic. When you look at those patients, and remember, all of these patients were coming off steroids, something surprising emerged. You would expect everybody to have large declines in your FVC over 100 milliliters. And we saw that in the placebo, that dotted line that you see there. It's hard to see here on this slide, but it's shaded there. That's the placebo. What's really surprising is in those patients who received five milligrams of efzofitimod, more or less flat. You see a large treatment effect emerge, over 124 milliliters in this modeling. This is a large number that the experts say, "Look, that's unexpected." This is another sign of drug activity, that the drug is helping things for these patients.
And by the way, you're not confounding any of this by steroids in the sense that you actually saw more reduction in the efzofitimod arm, 74% versus 58%, more steroid free observed in the efzofitimod arm, 50% to 40%, and relapse, you started to see almost four times more relapse in these placebo patients. All of these signs give us really strong confidence and conviction that in the next trial, we can model off of, if we're going to go after this sicker population, that this is a large treatment effect to target. Next slide. We also want to make sure that we saw consistency with all those other quality of life measures. Again, the King's Sarcoidosis lung, you see the solid green line versus the dotted line, always trending ahead of its placebo counterparts. Same thing with the KSQ general health.
The FAS, which is fatigue, here a negative is good. We see a really strong improvement in the fatigue scores with the solid green line compared to placebo, which did not. Patients still had quite a bit of fatigue. Again, looking at all the trends over and over again in this restricted population, the drug is performing better. It's actually allowing you to get off steroids at a greater clip. There's less relapse. There's better cough, shortness of breath, general health, and fatigue. This gives us a lot of confidence moving into the next trial. The key go forward plan here is really to focus on a primary endpoint that now is aligned towards what the agency wants us to look at in the next trial, FVC. This will in turn mean a tighter, sicker population with a restrictive lung phenotype.
We'll be looking at people with impaired forced vital capacity. Steroids are going to be stable because what efzofitimod is doing is changing treatment guidelines around the world. Everybody is getting off steroids now because of the efzofitimod data. That's good for them, unfortunately, these restricted patients still need something on top of the low dose steroids that they'll be on in this next trial. We have a slight tweak with our dose. The FDA said, "Look, you didn't really see a lot of issues with regards to drug toxicity." We looked at some modeling and said, if we increase the dosing to every three weeks from four weeks, we may get about 30% more efficacy out of the drug. That's a nice material win for us.
Again, the risk benefit is good here because we can give the drug, get a little more firepower out of it without actually getting a lot more safety effects in these patients. The design, we want this to be a really overpowered trial in many ways. We're going to roll over 100 more patients here, it's going to be a one-to-one looking at five milligrams versus placebo. Still going to be a one-year trial, we're going to look at forced vital capacity. Forced vital capacity is obviously the key endpoint here that we believe we can get approval around. You see we're going to be able to get 17 doses as opposed to 12 compared to the last trial because we're going to this Q3. I think this trial is really de-risked for success. The idea here is I'm aiming for about an 80 milliliter improvement.
Why 80? I don't need to go to 124. Experts say 75 and 80, that's a significant difference in our mind. The FDA, when you look at the approved therapies for similar drugs in IPF and PPF, the bar has been about 45 to 50 milliliters. We want to actually get to the sweet spot of 80. The idea here is let's have a P value that is less than 0.01. If we were a little short of 80, if we were 75, 70, even down to, say, 60 milliliters, we'd still hit a statistically significant 0.05 if we enroll 372 patients. I want some statistical padding here to allow us to win. That's why we actually increased the sample size here. I'll just end here with a couple key inclusion criteria.
I think the key thing here is to pay attention to that FVC. We're enrolling a sicker population. Last population, it was normal. We took people with FVCs of 100 or 105. This is going to be a population that you're less than 80%. You're sick, you're impaired, you're going to be on a stable dose, we won't have that prednisone confounding factor like that we had to account for in the last trial. We also are still excluding those patients with a lot of fibrosis. Frankly, if you have a high-risk CT of more than 20%, you should be on the anti-fibrotic. This is a sweet spot where this would be a core second-line therapy. As a second-line therapy, we still have a large patient population. That restricted population shrinks from the original 90,000 we thought we would go after.
You're looking at about 40,000 patients who need a therapy, frankly, have greater unmet need because they're trundling towards fibrosis. In our initial conversations with payers and some of the providers, the view is we could command an even higher premium price because these patients have a greater need. They're resigned to using a lot of off-label therapies. They're sicker. efzofitimod can solve a big problem for these patients who are beyond the mild-moderate phenotype from the last trial. I'll end here with just a wrap-up. Interstitial lung disease is obviously efzofitimod. I think we're one of the leading companies in interstitial lung disease. This is very much a de-risked program. It can springboard into other interstitial lung diseases from here. Things like chronic hypersensitivity pneumonitis needs new drugs. Also the connective tissue disease, ILDs, we're doing a small trial there. Large market opportunity, up to $5 billion.
We're the leading ILD company probably right now in the world. Real quick here, we have a small trial in scleroderma ILD. This is a connective tissue disease that actually attacks your lungs. It's an autoimmune systemic disease, but now your lungs get attacked. Another orphan disease that really has a high unmet need that needs better drugs. On the next slide, we highlight that we're doing a small 25-patient trial just for proof of concept. We expect to finish enrollment here rather shortly, and then this six-month trial, we look to read out early next year. This is exciting in the sense that these patients have debilitating skin disease, but also now their lungs are affected. This is a nice opportunity for us to expand the footprint of efzofitimod.
Just to wrap up here, our pipeline, I've talked a lot about efzofitimod, we also research other synthetase fragments in fibrosis. That's really our bread and butter here, this is all IP generated in-house and all protein therapeutics that we generate in-house in San Diego. Our outlook here is advancing our platform, focusing on efzofitimod. We'll be submitting a protocol here this month. I expect to be able to get a green light here with our IND fully activated for the next trial shortly after that. Again, we're in a good cash position here to start this trial. I'll stop there, we've got about eight to 10 minutes here for questions. Thank you. I'm pulling up the questions here. Thank you, Ashlee, for pulling some of these up. In no particular order. There was a question from Andrew.
Thank you, Andrew, for the question. Long-term, do you see aTyr remaining an independent commercial company in rare disease, or are you open to strategic partnerships once you're through Phase III and the FDA? I think as a company, we have to look at strategic partnerships at all times. I will say that our best parts of the company are research and clinical development. We don't have necessarily a large capability right now from a commercial standpoint. I think this is a very attractive opportunity for us to potentially partner. We also have to be prepared to go alone. Having worked also in big pharma, I know it's not always easy. A partnership could really help us. We're of course, several years away from having a commercial opportunity if we have to run this next trial.
I want to move this program forward in as best capital-efficient manner as possible, which means you can't close the door to actually having a partner help you along. You focus on development. They basically focus on commercial. Another question here is from Kevin. Targeting only restricted patients, removing the forced tapers both seem like major refinements. How much do you think that increases the probability of success? These are, as you say, major refinements, right? We're basically working with the agency to also position the drug to get approved. I think these refinements come from learnings from the trial. They also follow what many of the previous drugs like tocilizumab and some of the IPF drugs. They've always enrolled this restrictive phenotype and focused on less reduction of decline for FVC. This is not really an avant-garde clinical development approach.
Controlling for steroids is, I think, something that efzofitimod has taught us. These are, as you say, refinements. You could view them as major in that sense. I do think that these help us really de-risk the program, and we're prepared to actually now have a nice signal here that we can win on, hopefully in a few years. Sam had a question around the Type C meetings, a very clear blueprint. Fair to say you have a defined path forward with a potential single? I do. You hear the FDA talking more about a single, well-controlled trial, adequately controlled. The idea here is also I'm looking to power this trial so that we have more or less a slam dunk P value. The idea here is not to cut any corners, which is why we'll go to 372.
We could probably get away with running a trial with closer to 275 patients like last time. There you're on a razor's edge. I'd rather enroll more patients. These are more motivated patients who are sicker. Make sure that if we hit an 80-milliliter delta between efzo and placebo, that there's no question here with a very strong P value. Those are the sort of strategies that I think from a stats and regulatory point of view, the FDA likes. Makes it very difficult for them to not approve a single trial. You'll see more companies, and I think more companies should really pay attention to their sample size and power calculations if they're trying to go for a one and done strategy. Let's also remember the previous trial was a phase III trial. You can also look at it like this is our second phase III trial.
Kevin had a question. Targeting only restricted patients, we're moving for. Again, that was a question I think I've already answered. Frank has a question on SSc-ILD, encouraging signals from efzofitimod. We have also already looked at an interim there on skin in about eight patients. We highlighted that last year. Surprisingly, we saw three out of four of the diffuse patients, these are ones with the worst skin disease, respond rather quickly within that interim look. I hope that tracks for the full 25 patients that we enroll. Very surprising, because no drug has actually improved skin at all. Why I think our hypothesis with skin has merit, we see neuropilin, our receptor, highly expressed on the skin plaques of these scleroderma patients. That gave us a really good rationale.
Skin is really tough to move, at least the initial interim was quite promising, albeit in a very small subset of about four diffuse SSc patients. John, you had a question around 0101 myofibroblast depleter. Sounds like a very complimentary approach. What are the first fibrosis indications you're prioritizing? This is a therapy that has already developed a nice in vivo package, and we're really focusing on lung and kidney fibrosis. Myofibroblasts are really involved in the pathophysiology of both of those fibrotic mechanisms. Different reasons, of course. Some of our work is focusing on lung but also kidney fibrosis. I think it makes a lot of sense to look at it in those two indications. Also, the receptor we work with, LTBP1, there's some precedent in other lung and kidney attempts where people have tried to use a monoclonal antibody, if you will.
Stay tuned with that. I think the early trials, what I'd like to do is actually have patients. Obviously, we have a lot of lung fibrosis experience, historically in the past, I've worked in lupus nephritis, I also have some inroads and some understanding of kidney as well. Another two very bad morbidity and mortality statistics around those two indications. Luca has a question. How do you see efzofitimod stacking up against other emerging sarcoidosis and ILD mechanisms? Right now, there's been some failures. Kinevant had a failure where they were looking at an anti-GM-CSF. We're really the only phase III company right now. Some of the other approaches are TNF-like in private companies. TNFs do come with toxicity. I think they can be efficacious.
They're already being used with infliximab, and most of these are patients who are quite far along, and they have to fight with insurance companies. Right now, the horizon with sarcoidosis, we are one of the only games in town from a late development standpoint. I think that gives us an advantage for sure. Joseph has a question. From a patient impact standpoint, what do you see as a key differentiator for efzo versus current standard of care in pulm sarcoidosis, especially around steroid sparing? Look, we have done the field a lot to move the field with steroid sparing. We've taught them that you've been overdosing these patients. If there's anybody that anybody knows that's on sarcoidosis, you should tell them aTyr proved that you can be managed on about three and a half milligrams, whether you're on drug or not.
That's a win for them if they're on 10 milligrams. The problem is these patients still have quality of life issues, and they see no improvement in lung function. The way to think about this, Joseph, is in our next trial, we believe we can win on lung function, get the drug approved while still maintaining and seeing that improvement of quality of life. That's what the target patient profile will look like. In the new world with sarcoidosis, everybody's going to be on less steroids, efzofitimod fits in in a sicker population by improving your lung impairment and also improving your quality of life. That's what I think the drug label could be a differentiator when we launch, hopefully this first-in-class therapy. I know we're up on time. I don't know. Maybe there's one last question here.
Lawrence said, "How should investors think about regulatory path from the upcoming phase III trial to a potential commercial?" This is what we've tried to do, Lawrence. We've tried to really sit down with the FDA and not just say, do we have a green light? What does the protocol look like? We treated that FDA Type C meeting as very much a, like, if you will, a special protocol assessment to say, look, here is a protocol we're thinking of. Here's our rationale. We're thinking about if you want us to look at FVC, here's what we saw in the restricted population. I think it was a really collaborative, really good discussion. I also like the fact that we were more or less given a bump to go to Q3. I think that speaks to the safety of the drug.
I believe the agency is motivated to see a therapy get approved for pulmonary sarcoidosis, and I think we're the closest thing really ever over the last 15 or 16 years that has a chance in the short term here. Thanks everybody. I know we're out of time. I love the questions. I wish I could have gotten to all of them. Please, we're available, investor relations, for engagement and further questions. Thank you for your interest