Good afternoon, everyone, and welcome to Shattuck Labs Second Quarter Financial Results and Business
Thank you, operator. Good afternoon, everyone, and welcome to the Shattuck Labs conference call to discuss our 2nd quarter financial results and business updates. The press release for our financial results was issued after market close this afternoon and can be found on the Events and Presentations section of our website, shadecklabs.com. During this afternoon's call, the Shattuck team will provide a business overview of the Q2 of 2021, including an update to our clinical development plans for SL172, 154 and SL279, 252. A Q and A session will follow our prepared remarks.
Joining me on the call today are Doctor. Taylor Schreiber, our Chief Executive Officer Doctor. Lenny Pandit, our Chief Medical Officer Andrew Neal, our Chief Financial Officer and Kacide Young, our Chief Business Officer. Before we begin, I would like to remind you that today's webcast contains forward looking statements within the meaning of Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements represent management's judgment as of today and may involve certain risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by these statements.
For more information on these risks and uncertainties, please refer to our most recent annual report on Form 10 ks for the year ended December 31, 2020, and our other filings with the SEC, which are available from the SEC's website or on our corporate website, shaddocklabs.com. Any forward looking statements represent our views as of today, August 11, 2021. With that, I will now turn the call over to Taylor Schreiber, our Chief Executive Officer.
Taylor? Thank you, Conor. Good afternoon, everyone, and thank you for joining us. Today's earnings call is the first since our initial public offering in October of 2020, and I am exceptionally proud of the milestones our team has achieved since that time. Our clinical team has done an outstanding job of advancing the clinical development of both SL172, 154 and SL279, 252, our clinical stage agonist redirected checkpoint or ARC compounds.
As a reminder, 172, 154 is a SERP alpha FC CD40 ligand bifunctional fusion protein currently in 2 different Phase I clinical trials, 1 for patients with advanced ovarian cancer and another for patients with squamous cell carcinoma of the head and neck or skin. Our second clinical stage compound, 279, 252, a PD-one FC OX40 ligand bifunctional fusion protein is being developed in collaboration with Takeda Pharmaceuticals and is in Phase I development for patients with advanced solid tumors. Both of our ARC product candidates are 1st in class compounds that entered the clinic in less than 4 years since our founding due to the pioneering work of our scientific, manufacturing and regulatory teams. We are currently generating clinical data to validate the concept behind the ARC platform, and we are particularly excited to share this clinical progress with you in just a few months' time. Specifically, we have submitted our clinical data from the monotherapy dose escalation portion of our Phase I clinical trials for 172, 154 and 279, 252 to the Society For Immunotherapy of Cancer, also known as SITC, for presentation at its Annual Meeting on November 10 through 14.
Emerging data has guided us to amend and expand our clinical trials, and today we will provide some context for those expansions in addition to our general corporate update. During 2021, we have made steady progress towards advancing the dose escalation cohorts for 172, 154 in patients with relapsed refractory ovarian cancer. We are pleased by the safety and tolerability profile observed thus far and are continuing to dose escalate into the higher dose level cohorts. Given the totality of the data to date, we have begun to execute on our strategy to broaden clinical development into hematologic malignancies. Specifically, we will soon initiate a clinical trial for patients with acute myeloid leukemia, including a TP53 mutant acute myeloid leukemia cohort as well as for patients with higher risk myelodysplastic syndrome.
We see an opportunity for 172, 154 to potentially emerge as a best in class compound for these patient populations. We have also made significant progress in our clinical development efforts for 279, 252. We have completed enrollment through the 6 milligram per kilogram dose level, evaluated both weekly and biweekly dosing schedules and gained enormous insights regarding the behavior of ARC compounds in patients with cancer. The available data suggests that there is a compelling scientific rationale for continued dose escalation beyond our originally contemplated top dose level of 6 milligrams per kilogram, which Lenny will expand on in a few moments. Turning to our corporate update, it is my pleasure to introduce Doctor.
Abhinav Shukla, who joined us this quarter as our Chief Technical Officer. Abhinav has held both technical and leadership roles at large pharmaceutical companies, contract manufacturing organizations and small biotechnology companies. He brings a wealth of experience to our growing biologics manufacturing team. Abhinav's experience across the full spectrum of biologics executive team. Today's call will discuss select clinical data from our ARC platform, which we plan on unveiling in greater detail at SITC later this year as well as insights into our clinical strategy.
Lenny will discuss our clinical development programs to date. Then Andrew will provide the financial update for the Q2 of 2021, and then I will be back for some concluding comments. With that, I will now turn the call over to Lenny Pandit, our Chief Medical Officer. Lenny?
Thank you, Taylor, and good afternoon, everyone. First, I would like to discuss our lead clinical program, SL172, 154, which is a SIRPalpha Fc CD40 ligand bifunctional fusion protein. As a reminder, SL172, 154 contains the extracellular domain of the human SIRPalpha protein, which directly binds to and inhibits CD47. In addition, SL172, 154 also contains the extracellular domain of the human CD40 ligand protein to simultaneously and directly activate the CD40 receptor. As most of you know, we are currently exploring SL172, 154 in 2 ongoing Phase I clinical trials.
Our first clinical study of SL172, 154 is a multicenter open label dose escalation trial intended to assess the safety, tolerability, pharmacokinetics, antitumor activity and pharmacodynamic effects of intravenous administration of SL172-1 hundred and 70 two-one hundred and 54 as monotherapy in patients with relapsed refractory ovarian cancer. Enrollment in the monotherapy dose escalation cohorts has progressed smoothly. We are currently completing enrollment at the 4th dose level of 3 milligrams per kilogram, and we plan to proceed to the next dose level of 10 milligrams per kilogram thereafter. Our second clinical trial of SL172154 is an ongoing multicenter open label dose escalation clinical study intended to assess the safety, tolerability, pharmacokinetics and tumor activity and pharmacodynamic effects of intratumoral administration of SL172, 154 as monotherapy in patients with relapsedrefractory squamous cell carcinoma of the head and neck or skin. We remain on track to present initial data from this study in the first half of 20 22.
Overall, we are very pleased with the emerging profile of SL172-1 hundred and 70 two-one hundred and 54. To date, no dose limiting toxicities have been observed in either clinical trial, and we are encouraged by our ability dose in the higher dose level cohorts. Because SL172, 154 contains both CD47 inhibitory and CD40 agonist domains, the safety data should be considered in the context with prior CD47 inhibitors and CD40 agonists. On the CD47 side, consistent with our preclinical data, we have not observed any evidence of anemia or thrombocytopenia, which we believe is due to the selection of an effector silenced Fc region for SL172-1 hundred and 70 two-one hundred and 54. We believe this contributes to the safety profile and differentiates SL172, 154 from other CD47 inhibitors with active Fc domains that have reported anemia or thrombocytopenia in clinical studies.
On the CD40 side, it is worth remembering that CD40 agonist antibodies have been in clinical testing for well over 20 years, but progress has been repeatedly hampered by a combination of toxicities at low doses and evidence of a bell shaped dose response curve. In the case of SL172-1 hundred and 54, clearing the 3 milligram per kilogram dose level would be a major milestone because previously studied CD40 agonist encountered dose limiting toxicities, including a combination of cytokine release syndrome and liver dysfunction above doses of roughly 0.3 milligrams per kilogram, which is onetenth the current dose level of SL172154. To date, we have observed none of these adverse events, yet we have observed unique evidence of CD40 engagement and pharmacodynamic activity. We plan to share further details at the SITC conference later this year. We are very excited and encouraged by the emerging profile of SL172, 154 and believe that we have entered an immunologically active therapeutic window not seen with prior CD40 agonists.
The emerging profile of SL172-1 hundred and 70 two-one hundred and 54 has prompted us to initiate our plans to bridge an immunologically active dose from the Phase Ia clinical trial in ovarian cancer to the Phase IaIb clinical trial in hematologic malignancies. And today, we are excited to announce that we plan to expand into clinical studies in both acute myeloid leukemia and higher risk myelodysplastic syndrome. In AML, we plan to study SL172, 154 in combination with acacitatine and venetoclax. In TP53 mutant AML, as well as in higher risk MDS, we plan to study SL172, 154 in combination with acacitidine. We expect to file an IND for this trial in the Q4 of this year and initiate a Phase 1a, b trial thereafter.
Specific details on the trial design will be forthcoming. As a class, CD47 inhibitors have demonstrated clinical activity in both AML and higher risk MDS. We see an opportunity for SL172, 154 to differentiate from other compounds in the field due to the combined effects of CD47 blockade and CD40 co stimulation. Now I would like to turn our attention to SL-two hundred and 79252, our PD-one Fc ox40 ligand bifunctional fusion protein. As most of you know, we are currently enrolling in a Phase 1 multicenter open label trial to evaluate SL-two 279, 252 administered intravenously as monotherapy in patients with advanced solid tumors and lymphoma.
To date, we have enrolled a heavily pretreated predominantly PD-onePD L1 experienced patient population across the initially planned dose escalation cohorts beginning from our first dose level of 10 to the minus 4 milligrams per kilogram to 6 milligrams per kilogram and evaluated 2 dosing schedules. We have not observed any dose limiting toxicities through the highest dose level. We have observed dose dependent OX40 receptor engagement of OX40 expressing T cells and a primary pharmacodynamic effect showing rapid egress of these target cells from the circulation, which has not previously been reported for prior OX40 agonist antibodies. Because the emerging data indicates that additional dose levels could enable a more complete assessment of PKPD and antitumor activity, we plan to continue to dose escalate through 2 additional dose levels of 12 milligrams per kilogram and 24 milligrams per kilogram. At this time, however, it remains unclear whether OX40 activation may increase response rates beyond what is expected of PD L1 inhibition in PD-one experienced patients.
Because very few patients enrolled to date were known to have PD L1 positive tumors, we plan to now select for patients with known PD L1 positive tumors and we'll be looking for clinical response rates that indicate a feasible development path in PD-one experienced populations. Thus, we look forward to the additional data from the higher dose cohort. Overall, we are pleased with the progress that we have made to date on both of our clinical stage ARC product candidates and look forward to the future growth in our clinical development efforts. We believe that the pharmacodynamic profiles observed with both SL172-one hundred and 70 two-one hundred and 54 and SL279-two 52 demonstrate activation of CD40 and OX40, respectively, in a manner not seen with prior CD40 and OX40 agonist antibodies. This is consistent with our underlying hypothesis from which the ARC platform is derived.
With that, I will now turn the call over to Andrew Neal, our Chief Financial Officer. Andrew?
Thank you, Lenny, and good afternoon, everyone. As Conor mentioned, the full financial results for the Q2 of 2021 are available in our earnings press release and our forthcoming 10 Q. Today, I would like to focus on a few key points from our disclosures. We are fortunate to be well positioned financially. As of June 30, 2021, we have cash and cash equivalents and short term investments of approximately $304, 800, 000 Revenue for the Q2 ended June 30, 2021 was negative $4, 200, 000 compared to $3, 200, 000 for the Q2 ended June 30, 2020.
All revenue to date is generated solely from our collaboration agreement with Takeda. The negative revenue for the Q2 of 2021 was driven by increased expected costs required to complete our performance obligations in the collaboration agreement as a result of the modifications to our clinical development plan for SL-two 70 nine-two 52. The negative revenue does not affect our cash position. In the Q2 of 2021, our research and development expenses were $14, 900, 000 compared to $7, 800, 000 for the Q2 of 2020. In the Q2 of 2021, our general and administrative expenses were $5, 400, 000 compared to $1, 700, 000 for the Q2 of 2020.
Our net loss for the Q2 of 2021 was $23, 600, 000 or a loss of $0.56 per basic and diluted share compared to a net loss of $6, 200, 000 for the Q2 of 2020 or $0.81 per basic and diluted share. Now turning to our financial guidance for 2021 and beyond. Our financial guidance remains unchanged from the guidance given in connection with our initial public offering in October 2020. Importantly, expansion of SL-seventy two-one hundred and 54 into clinical trials in patients with AML and higher risk MDS does not change our current cash runway guidance because the operating expenses associated with these trials were included in our internal forecasts. Based on our current and planned operations, our expected cash runway remains through year end 2024.
And with that, I will now turn the call back over to Taylor. Taylor?
Thank you, Andrew. Over the past year, Shattuck has made tremendous progress, and we are learning how to best apply the ARC platform for the benefit of patients with advanced cancers with the learnings from our first 2 clinical trials. SL172, 154 and SL279, 250 2 have been very well tolerated in humans to date, which bodes well for the ARC platform as a whole. In addition, we have observed an escalating linear relationship between the dose of ARC administered and the corresponding pharmacodynamic responses to 172, 154 and 279, 252. We believe these observations validate 1 of the central hypotheses to the ARC platform that hexameric compounds like ARC's will engage TNF receptors in a fundamentally different manner than monoclonal IgG antibodies.
Our progress with 279, 252 has been exciting, and we believe that the data collected from additional dose escalation cohorts will allow us to fully characterize the pharmacokinetic profile and to identify the dose at which the pharmacodynamic effects of OX40 stimulation reach maximum levels. We began this study in a PD L1 unselected and highly heterogeneous patient population in order to proceed quickly through dose escalation. Now that we are within an immunologically active dose range, it is now appropriate to enrich for patients with PD L1 positive tumors. It is not yet clear, however, whether OX40 stimulation will increase response rates beyond what is expected of a PD-one inhibitor in a PD-one or PD L1 antibody experienced patient population. The path forward for 279, 252 will depend upon observing monotherapy activity in PD-one or PD L1 antibody refractory patients at these higher dose levels.
An enormous opportunity remains to address the unmet need in PD-one and PD L1 experienced patients, and we are excited to further characterize 279, 252 at higher dose levels in a PD L1 selected patient population. We are also highly encouraged by the early data the dose escalation portion of our clinical trial with 172, 154 in ovarian cancer and look forward to filing our IND for our Phase 1a, 1b clinical trial in AML and high risk MDS in the Q4 of this year. Several patients have cleared the dose limiting toxicity window at a dose of 3 milligrams per kilogram, which is a dose 10 fold higher than the maximum tolerated dose for prior CD40 agonist antibody therapies. This is also a dose range at which other CD47 47 inhibitors began to achieve high levels of receptor occupancy on CD47, suggesting that 172, 154 may bridge the perceived gap in effectively dosing a CD40 agonist to the level required for a CD47 inhibitor. We believe that expansion into hematologic malignancies with 172, 154 will further demonstrate 172, 154's best in class potential as a CD47 inhibitor.
The emerging clinical data from 172, 154 and 279, 252 suggest that the ARC platform has unlocked the TNF superfamily of co stimulatory receptors in a manner that has evaded IgG antibody based modalities for over 20 years. The data suggests that CD40 is a very powerful stimulator of the innate immune system, whereas the effects of OX40 stimulation are more subtle. That said, a complete exploration of CD40 and OX40 biology has not been possible with IgG antibodies because escalation to higher dose levels was limited by a combination of toxicity and diminishing signs of immune activation. We believe the opportunity to compare and contrast the biologic consequences of CD40 versus OX40 activation in just a few months' time will challenge some of the dogma that has surrounded these targets for decades. Before we turn to Q and A, I would like to close by thanking all of our clinical investigators, their teams and institutions, and most importantly, the patients and their families who have participated in our clinical trials and have helped make this progress possible.
From all of the employees at Shattuck, we look forward to the second half of this year and the milestones it will bring. We appreciate your continued interest in Shattuck and look forward to keeping you appraised of our progress throughout the year. With that, operator, I would like to open the call for questions.
Our first question will come from
the line of Mark Frahm from Cowen. You may begin.
Hi, thank you for taking our call. This is Ernie Rodriguez for Mark. Congratulations on your progress. We just have a question or follow-up on your commentary regarding the receptor occupancy for the CD47, Sherpa, on 154. Have you discussed what level of receptor occupancy you have achieved?
And if this level is above what others have seen or experienced anemia on side effects?
Thanks. Sure. Hi, Ernie. And thank you for the question. This is Taylor.
We will be disclosing the specific receptor occupancy levels at SITC. However, I can put the dose levels into a little bit more context with what has been reported with some of the other CD47 targeted agents. And with an antibody like magrolumab, for example, that antibody began to see early receptor occupancy on CD47 expressing red blood cells and then saw saturation of CD47 expressing leukocytes. But that didn't occur until they reached those levels of roughly 20 milligrams per kilogram. In contrast, some of the SIRPalpha Fc fusion proteins have been shown to achieve full occupancy and with different Fc fusion proteins, full occupancy can mean different things, at levels of between 1 3 milligrams per kilogram.
Our impression of the reason why some of the SIRPalpha fusion proteins have not reported 100% occupancy on CD47 positive leukocytes is not that you cannot achieve 100% occupancy on leukocytes, it's that some of the lower affinity or lower avidity SIRPalpha FC fusion proteins have a faster off rate and fall off CD47 on leukocytes faster than either highabidity or high affinity SIRPalpha fusion proteins. So hopefully that provides a bit of context.
Yes, that's very helpful. Thank you.
Our next question comes from the line of Jonathan Miller from Evercore ISI. You may begin.
Hi, guys. Thanks for taking my question. I'm really looking forward to seeing some of this initial clinical data efficacy. So while we look forward to that, I mean, it seems like escalation on 154 so far has been very supportive on safety, I should say both programs, but no responses yet. So now as we're entering the immunologically active dose range, what are the key biochemical signals we're going to get at Sydney that will get us comfortable with activity, given we're sort of just entering that active dose range?
And then secondly, as we turn to heme indications, I see that you're planning to pursue combo trials, obviously, we're starting in mono there. Competitors have all moved robustly to combo trials for further development. Do you have any expectations of a meaningful monotherapy activity rate or development in that direction?
Sure. Thank you, John. I'll take the first part of the question and then ask Winnie to take the second. So in turn, she can elaborate on my response to the first as well. What you should expect to see at SITC with both programs is, all of the patient characteristics and safety data to date at the various dose levels, the pharmacokinetic profile of the compound across the dose ranges, and then the pharmacodynamic effects that will include receptor occupancy, as Lenny mentioned, for the OX40 engaging compound 279, 252, margination of OX40 positive lymphocytes at various dose levels.
And then for both compounds, immunophenotypic data and serum cytokine analysis, as well as anti tumor activity. And I will ask Lenny to take the second half of your question there regarding AML and MDS.
So thank you for the question. With the AML MDS, the monotherapy portion of this is a very short monotherapy. That's our plan to go into the combination very quickly. So we are bringing in an immunologically active dose. We are bridging that dose from the Phase I ovarian study, and our plan is to go quickly into the combinations that I mentioned with azacitidine venetoclax and with azacitidine monotherapy with azacitidine and azacitidine venetoclax.
Okay, sure. So I think that there's no expectation of seeing substantial monotherapy activity there or developing in that direction.
If you don't mind, John, I'll just make 1 quick comment on that point. And our guidance around monotherapy antitumor activity for 172, 154 is based upon 2 things. It's based upon what is known clinically about the expected monotherapy activity of the CD40 agonist as well as what is known clinically about the expected activity of an Fc silent CD47 inhibitor. And our interpretation of the 20 plus years experience we have of CD40 agonist antibodies in human clinical studies is that, while some agents have shown sporadic monotherapy activity in tumors like melanoma, rheotel carcinoma and lymphoma, there is no consistent pattern of monotherapy activity at least with the CD40 agonist antibodies. And because of that, we don't feel that it's appropriate to frame efficacy expectations around any CD40 agonist agent.
On the CD47 side, the only agents that have shown monotherapy activity are those that have residual function in the Fc domain. CD47 and inventory agents, which lack that function, do not have monotherapy activity and they also don't have tox. And so what that tells you with the CD47 inhibitors as a class is that the Fc domain and the characteristics of the Fc domain are in and of themselves sufficient to drive toxicity. However, what you notice about all CD47 inhibitors regardless of whether the Fc domain is active or inactive is that they are all pursuing registrational pathways in combination either with certain chemotherapies or, ADCP competent tumor targeted antibodies. And so you can then extend the conclusion a bit from there and say that while the Fc domain is sufficient for tox and sporadic monotherapy activity, it is insufficient to drive registration.
And so with this agent, we are again framing expectations based upon 172, 154 being a CD47 inhibitor with an inactive Fc domain.
Great. Thank you. I think that's very responsible. Maybe turning to 252, can
you speak a little bit to the clinical relevance
of OX40 stimulation pushing T cells into the periphery out of the blood? Are there other kinds of T cell activation that go along with that? And granted it's tough to disambiguate what's going on given the lack of in many of these patients. But I'm trying to focus specifically on OX40 access PD and what that can tell us about successful immunostimulation?
Yes. Thanks for the question, John. So OX40 is an antigen dependent CD4 specific T cell co stimulator. And so you expect the pharmacodynamic, at least the direct pharmacodynamic effects of OX40 stimulation to be centered on that T cell population and more specifically to a subset of CD4 positive, FOX40 positive T cells that are actively encountering, in this case, tumor antigens. And in that subset of cells, you may expect those cells to rapidly carry 279, 252 from the peripheral blood into tissues.
And if that includes tumor tissues, then that could provide a means of actively transporting 279, 252 out of the blood and into peripheral tissues, including tumors. And if those cells are being activated, then you would expect to see some signs of that. That could come in the form of changes to the immunophenotypic profile of those cells and patterns of activation markers, or it could come in other forms. But, it's hard to say for sure because the human experience with FOX40 antibodies contains very, very little in the way of convincing pharmacodynamic activity to date. And so I think we are in somewhat uncharted territory here for OX40 agonists.
And therefore, we want to be sure that we fully explore the dose levels here and identify a dose level at which OX40 biology, at least as far as we can measure it, has been maximized.
Great. Makes sense. Thank you very much.
Our next question comes from the line of Gil Blum from Needham. You may begin.
Hello and congrats on all the progress. It looks like the both programs seem to be very safe. But as you dose escalate, do you expect at some point to start seeing some level of immune mediated talks, the sort of low grade rash, low grade CRS that are seen sometimes with the immune oncology agents?
Sure. Thanks for the question. I'll ask Lenny to take this 1.
Yes. As we dose escalate, given that we do have an agonist end to this molecule as well, we would expect to see some degree of tox. What we are very encouraged is that we are able to dose escalate through the lower doses, especially in the CD40 targeted with CD40 antibodies, dose limiting toxicity has precluded dose escalation beyond 0.3 milligrams per kilogram. We've been able to dose escalate to we are currently at 3 milligrams per kilogram. And so it gives us an opportunity to dose escalate to the point that we have receptor occupancy on both CD40 as well as CD47 and being able to saturate those receptors.
So I think we are encouraged by this dose escalation that we're able to do. But as you said, that certainly, I mean, we certainly monitor our patients with the view to the fact that there could be toxicity at higher doses.
Okay. And on 252, just to clarify that I understood this correctly. So we're discussing enrichment for patients who are PD-one positive and PD-one refractory following PD-one based therapy. Is that correct?
Yes, that's correct. That's correct. So the reason for that, in our dose escalation up to now, we did not really select for patients who are PD L1 positive. We started at a very low dose, and we wanted to get through the dose escalation as efficiently as possible to a point that we had an immunologically active dose range. And currently, we are at that dose range.
So moving forward, our plan is to select patients with no PD L1 positivity. And the reason for that is that 1 end of our molecule binds PD L1. And so it would make sense to actually select for that. Now we certainly acknowledge that these are patients who have failed PD-one therapies and have other mechanisms of resistance that may preclude them from responding to an agent such as this.
Okay. That makes a lot of sense. And maybe a last 1 on the TIGIT program, which we haven't discussed too much today. Following kind of the results in the space, Arcus and others, has there been any additional disclosures regarding whether we're going with an SC Active or an SC Inactive here?
There has not been any additional disclosure yet, but we will be providing additional guidance around the next ARC program to enter the clinic later this year.
Okay,
excellent. And we all definitely look forward for your results at Ceti. Thank you for taking our questions.
Thanks for the questions.
And our last question will come from the line of Zikwan Shue from Berenberg. You may begin.
Hi, good afternoon. Thanks for taking my questions. So on your first 154 program, the current dose is 3 milligram per kilogram. The next 1 is 10. It seems to be a big jump.
I guess what gives you that level of comfort you can those escalate to more than to 3 times of that to your current dose? Curious your thoughts there.
Sure. Hi, Ziv. Thanks for the question. I'll ask Puneet to take that 1 as well.
So Ziv, we often dose escalate in these oncology studies in half log increments. So that 3 to 10 is a reasonable increase, that's a half log increase. And so depending on what we see at 10, then we'll determine whether we need to go higher or not. But right now, that's actually a very reasonable increase.
Got it. And then in terms of next step, will you select a recommended Phase II dose and move into the combination study as combination phase of the study. I guess what are the gating factors you're looking for when you select the dose and when you want to combine with rituximab, cetuximab, you are in the trial?
Sure. So in general, what we're looking for in identifying a recommended Phase 2 dose is to find a dose which is well tolerated, where we see saturation of both targets of the ARC compound. So in the case of 172-1 hundred and 54, that will mean saturation both CD47 and CD40. And where we see that, there has been a continued escalation in the on target pharmacodynamic effects that we expect to see downstream of that engagement and wherein those pharmacodynamic effects have escalated up to a point and then reached a plateau. Presumably after not every patient will reach maximum pharmacodynamic activation of CD40 or OX40 at the exact same dose.
And so identification of a maximal plateau may improve the probability that we select a dose which maximizes the biology for all patients we might treat. Of course, then observation of antitumor activity is important. And then we should have mentioned this earlier, but also in narrowing the dose and schedule, we'll be looking as well at the PK profile and ensuring that not only do we achieve full occupancy of the targets, but that there is sufficient free drug in the system to maintain full occupancy through the dosing interval. So collectively, those are the vectors that we're triangulating to pick a dose going into subsequent studies.
Great. Thanks, Taylor.
Sure. Thanks for the question.
Thank you. That's all the time we have for today's Q and A session of the call. At this time, I would like to turn the call back over to Taylor Shrider, Chief Executive Officer of Shattuck Labs for closing remarks.
Thank you, operator, and thank you all for joining the Shattuck Labs 2nd quarter financial results and business updates conference call. We appreciate your continued interest in Shattuck, and we look forward to updating you on our milestones throughout the remainder of this year. Thanks very much.
This concludes today's conference call. Thank you for participating. You may now disconnect. Have a wonderful day.