Muscle, that will be great. We are highly focused on what a label would look like that could be testable in this patient population.
Okay. I guess maybe focusing on the obesity market as well, especially as it relates to the muscle preserving drugs. Why is muscle loss such a big unmet need? Is it all about muscle preservation, or you could increase some of the weight loss that has been seen with the current incretin drugs out there?
Yeah. The idea is you want incremental weight loss, and you get the incremental weight loss by holding onto muscle. Yes, muscle is a problem, and the reason it is a problem is because patients that are older have less muscle to begin with, and even though they lose the same proportion of muscle, they have less muscle starting out. We have, in our phase II-B QUALITY study, shown that 44% of patients on semaglutide alone at 16 weeks had a greater than 10% decline in stair climb power. The loss of muscle matters from a function standpoint. The market that we are going after is the 40 million patients over the age of 65, of which half can benefit from a weight loss drug.
The answer is, as I mentioned in my comments just before, the problem is that 90% of patients with a BMI greater than 35 will still have, technically, obesity at a year, and they have hit the PLATEAU where they cannot lose any more weight. We have to fix that problem, but at the same time, we have to make sure they do not lose muscle. Interestingly, some new studies are starting to show if you want the cardiovascular benefit from weight loss, you have to hold onto muscle.
Okay. You have had a lot of recent FDA interactions, thinking about muscle preserving drugs and what it takes to get the drugs approved. Can you talk about those interactions, what the agency's current thinking is in terms of approval endpoints?
Yeah, it is a great question. We have always been thinking about our program from a standpoint, what would an FDA label look like? Our discussions with the FDA is, it is one thing to say that you preserve muscle, it is another thing to get a label that says that. The FDA is not interested in making a cosmetic statement that you held onto lean. You have to show what does that mean to the patient. Our first clinical trial, the phase II-B QUALITY study, proved that patients have loss of lean, have a problem with a functional endpoint. FDA likes stair climb, they like functional endpoints. They are not so much interested in cosmetic or strength endpoints. We know that. The FDA wants you to pick a patient population that you can benefit.
Just to say, "I am going to take all patients and preserve muscle in all patients," that does not work. If you say something like, "I am going to take patients that have functional limitations, that are older, patients greater than 65 that have less muscle, they want to be on a GLP-1 to get the cardiovascular benefits of a GLP-1. If I treat them with a muscle preservation drug, can I preserve their function?" How do you measure that function? A lot of discussion with the FDA is think two things. Think of what you want your label to say that you are going to do to benefit the patient. Second, make sure your safety database also thinks about the fact that probably all patients are going to want to take a drug like this.
Right.
Focus first on the patient population that is at risk.
Okay. Regarding the endpoints, what functional endpoints are relevant for the FDA?
Let's see.
There's a suite of things.
The FDA doesn't tell you what they want.
Okay.
They tell you what they don't want.
What do they-
They want a functional endpoint. Stair climb has been used in muscular dystrophy in the past. Stair climb has been used in frailty. The literature is filled with information showing the benefits of stair climb as a measurement of anabolic activity and measurement of how a patient ages. It's very sensitive in detecting changes in decline. The reason that's important is because the detriment in stair climb links and bridges to the frailty data that shows that if you have a problem with stair climb, then you're going to have a problem with balance, gait, you're going to have falls, you have fractures, your hospitalizations go up, mortality goes up. So essentially, what we're trying to say is that older patients want to get the cardiovascular benefit of a GLP-1. But if they're trading that off for hip fracture, that's not good. Can you get both?
Again, the focus, focus is on a method that shows function and is sensitive to the patient population. The stair climb is one.
Things like grip strength and chest press and leg press, not so much. It is not really function.
Okay.
What we are also doing in our studies, we are measuring quality of life, and we are measuring, for example, SF-36 PF-10, which is a quality of life questionnaire that measures how a patient feels, based on function. Same thing with the IWQOL-Lite questionnaire, again, for obesity studies, looks at, again, how a patient feels. So linking the stair climb to how a patient feels and those changes that occur will help us because the way to think of our phase II-B, which is 239 patients fully enrolled now, and goes over 68 weeks, where our other one was only 16 weeks, think of it as a mini p hase III. Why do you do a phase III? Phase III, you are going to need 4,500 patients. So does it make sense to get it right?
To have a phase II-B that shows short-term and what happens when you stop a drug, have another phase II-B that goes literally a mini phase III, will allow the company to have a very clear confidence in the phase III program.
Okay. Is that statistical significance enough for the FDA on these functional endpoints? Because, for example, in weight loss, they want to see 5% improvement over placebo arm. What is the thinking around functional endpoint?
You're absolutely right. As it relates to weight loss, if you hit an incremental weight loss of greater than 5%, and it's statistically significant, that gets you the title of your drug in combination with the incretin, is good for weight loss. If you want the muscle preservation piece, you need the function. Function, you need to define not just statistical significance, but what is the functional benefit that the patient feels. That's why this phase II-B is important, because we're actually, again, linking the quality of life questionnaire with how a patient actually performs, and so we can quantify, what does 10% mean, what does 5% mean, and that kind of stuff.
Okay.
I can tell you from the literature, at 10% decline in physical function by stair climb, all kinds of bad things happen. Loss of function is a real sensitive way of measuring a bad outcome. If you can prevent the loss of function, then the outcome should be a good outcome, and that would be how you would measure the drug.
Okay. Got it. Maybe focusing on enobosarm, in terms of the mechanism, how does it work in preserving muscle?
Enobosarm is a small molecule. It's a selective androgen receptor modulator, so it goes through a time-tested receptor called the androgen receptor. Androgen receptors in all kinds of tissue. What makes SARM different is in some tissues, it's an agonist, in some tissues, it's an antagonist, in some tissues, it's neither. By empiric testing in over 2,000 patients in 27 clinical trials, we have a pretty good idea what the enobosarm does. What enobosarm does, it's anabolic on muscle, but it's catabolic on fat, anabolic and anti-resorptive on bone, but does not cause masculinization in women. They don't get facial hair and get masculinized. In men, it has very little effect on the prostate. That's where the word selective comes in.
Being an oral 24-hour half-life, you can take it once a day, allows it to be used in, for example, in combination with a GLP-1 to get the anabolic effect. What do I mean by that? GLP-1 tells the brain to drop the appetite, tell the patient to stop eating. So you're in a low-calorie state, and your body, in a low-calorie state, tries to hold onto muscle and burn fat, but unfortunately, when you lose too many calories, you burn fat and you burn muscle. With enobosarm, it's burning more fat and it's stopping the muscle from breaking down peripherally. So the brain centrally saying, "Stop the appetite." Peripherally, you're telling those tissues, "I want you only to lose fat and hold onto muscle." That's the definition of adiposity, excess fat. The definition of an adiposity drug is get rid of the excess fat, and that's what we're doing.
Got it. You're doing combo trials with sema, and I want to go even into the data as well, but maybe why sema? Why not just do it with tirzepatide, which is well-
First of all, for regulatory purposes, you want to pick one.
Yep.
Because tirzepatide and semaglutide are different. With tirzepatide, you lose a lot more weight than you do with semaglutide, so if you're trying to show incremental weight loss, it's probably going to be easier if you have some weight to lose.
The other reason we went with semaglutide is there's an oral form of semaglutide, so that in the future you can imagine a combination of semaglutide oral with enobosarm oral, and you can pick up more patent life. With tirzepatide, there's no oral tirzepatide. There's orforglipron.
Yep.
But orforglipron is not a very good oral drug. It's 10% or less. If you look at the market right now, even though tirzepatide injectables are a big part of the market, oral, and 80% of the oral market's now semaglutide Wegovy. From a marketing standpoint and having data from this trial that gets you into the injectable and the oral, this makes the most sense.
Got it. Are the two drugs maybe oral Wegovy being a peptide, enobosarm being a small molecule, how easy is it to combine these drugs?
The question is can you combine them in a fixed combination versus you just have taking both and co-administer.
Right.
I don't know the answer to that at this point. I can tell you our new formulation is such that it could potentially be combined with a peptide, but that can be easily worked out.
Got it.
The fact that one's a peptide and one is a small molecule makes the safety interaction-
Right
potential less.
Yeah, no DDI.
Yeah.
Okay. Maybe walk through some of the data that you have shown in the phase II trial, especially the phase II QUALITY trial we talked about in combination with sema. What are some of the key highlights from that data set?
The key highlight is enobosarm did exactly what we expected. Patient population of patients over 60, patients that have a diagnosis of obesity, and starting semaglutide for the first time. We had two treatment arms, and we had the placebo arm. All patients started semaglutide. For 16 weeks, we treated them during what I call the active weight loss period, and then for 12 weeks, we stopped semaglutide and kept them on enobosarm alone or placebo alone. They were very different parts of the study that gave us good information. Why do we pick 16 weeks? Because in all of our previous six muscle studies, 16 weeks was plenty of time to show benefit in stair climb, and we did. It did what we hoped it would do, for the 3 mg group, the enobosarm, and we had a 6 mg group for enobosarm.
The purpose of the six was not to show more muscle preservation activity because we have had plenty of studies telling us 3 mg is fine. We picked six because in fat, it turns out that you can keep going higher and lose more fat. If we wanted to lose more fat and use a higher dose of enobosarm, we can do that. That is exactly what we showed. We showed that the 3 mg, we preserved muscle 100%, lean mass 100%, and the 6 mg did not add to that. At the fat, we showed that we lost more fat with the 3 mg. We lost even more fat with the six. Weight loss was the same across the board, and the weight that was lost was 100% fat, which is what you want.
To take a drug that is trying to lose lean, like GLP-1, losing lean and losing fat, and convert it to now the combination losing only fat was our goal.
Okay.
From a function standpoint, we were able to show the 3 mg group, were able to reduce the number of patients that had a greater than 10% decline in stair climb by up to 60%. Highly statistically significant. What that means is we were able to preserve what turns out to be the first time a study that showed that we have a problem. In other words, if you took semaglutide and placebo, 44% of those patients at 16 weeks had a greater than 10% decline in stair climb power. 10% decline in stair climb power is like seven to eight years of decline in power that naturally occurs with aging. If someone starts at 60, you made them a 70-year-old by putting them on GLP-1.
Okay. If you can just elaborate on the functional endpoint of stair climb power, how is this conducted?
Good question.
Yeah.
It's an eight-step stair climb, and the patient's asked to go up the stairs as quickly as they can. We have computer switches that get activated when they touch it, so it's not somebody sitting with a stopwatch. We have a formula that looks at weight and looks at time to go up the stairs. They go up the stairs, and what we did also is we loaded them, meaning that we added 10% of their weight onto the base. Why would you do that? If we want to show how well a muscle functions, then put a little stress on that muscle because then you're going to be able to get into a range of that assay that you can see differences. We did that. What's interesting, this is a very key point.
Doesn't it make sense that if patients lose weight, they should go up the stairs faster?
Okay. Guess what? It didn't happen. The patients on semaglutide alone, they definitely lost weight, but they went up the stairs slower than the enobosarm patients that had more power and lost the same amount of weight. People understand that better than horsepower. They know what that means. But you're telling me they're lighter and they went up the stairs slower? That doesn't make sense. That's what happened.
Okay. Did you consider doing other functional endpoints apart from this?
No, because this one is the one that is most responsive. If you look at the literature, there is tons of research that has been done that shows that, again, stair climb is very sensitive to anabolic intervention, meaning telling you have a difference.
It is also very sensitive of picking up decline.
Okay.
Grip strength, for example, is very crude and not as sensitive. We wanted to have something that has a history, especially with our drug and with testosterone-type products, of showing a difference.
Okay. Maybe if you can talk about the safety profile as well.
Sure.
What do you see, and I believe there were a few cases of liver enzyme elevations. How much was the increase? Did patients have to discontinue the drug?
So in general, safety was well, with a positive safety profile. There was no additive gastrointestinal side effects. In fact, we made the gastrointestinal side effects better with enobosarm. Adverse events of special interest would be, of course, what's happening with the liver. In the liver, in the 3 mg group, we had one patient in the 3 mg dose that had a three times increase in ALT that went down on drug. In 6 mg, we had more, but again, same pattern. It goes up and comes back down. Had no example of bilirubin going up or Hy's Law. The dose that we picked to go forward is the 3 mg, so that's the one with just one patient, and 3 mg in our database of 2,000 patients, the safest one. From that standpoint, the safety profile looks pretty positive.
Okay
for a SARM, and that's important because people look at SARM as being abused in the literature and on the internet. It's amazing how enobosarm, over the years, performed quite well from a safety standpoint.
Right. Got it. You have an ongoing phase II-B called PLATEAU Trial right now.
Yes.
Why another phase II-B, and is there any reason why you have to do this and not go straight into a pivotal trial with any constraints?
The idea was for us to have phase II-B information that will allow us to move into the much larger phase III. What we had in the phase II-B QUALITY study was 16 weeks of active weight loss. As you know, the longer you go, the more lean you are going to lose, and the more function decline is going to happen. By going to 68 weeks with semaglutide, it is going to amplify the difference between being on enobosarm semaglutide versus semaglutide alone, and give us the information that you will need for phase III, which will be for 68 weeks. We did not have that information. So we will have that information. Furthermore, we are putting in all kinds of function endpoints, quality of life questionnaires that we did not have in the first phase II-B.
Again, this will help us define what our patient population is going to be. Think of the phase II-B as a mini phase III, because you are still going to have to do a total of 4,500 patients for an obesity product. But you want to do that when you have full information.
Okay. Any other trial differences in the phase II-B PLATEAU trial versus a QUALITY trial?
Yes. The difference is, what we learned in the QUALITY trial is that patients over 65 and a BMI greater than 35 were the most active, the best result. This trial is now fully enrolled with 239 patients, and we're doubling down. We're going after patients older than 65, and patients with BMI greater than 35, which under normal circumstances, if they were on GLP-1 alone, would have the most problem with loss of lean and function. Furthermore, would still, on average, still be considered obese, have adiposity, which means you haven't solved the problem. That's why we call it the PLATEAU study, because what happens is you stop losing weight, and if you're still in the adiposity range and you still can't lose any more weight, then you're not getting the cardiovascular benefit.
The idea here is with muscle, and holding on to muscle, you're going to be able to burn more calories, both because the tissue needs more calories, but because the function will burn more calories, break through that plateau. That's the thinking of having the combination. Somebody said to me, "Mitch, if you do that, then don't you think patients maybe will gain weight because muscle weighs more than fat?" I will tell you two things. One, we never saw that in our 16 weeks. If you look at the competitors, the Lilly study with bima, or the study from Regeneron with trevogrumab, none of these studies, six months and up to 72 weeks, not a single patient gained more weight. They lost weight. In fact, in the bima study, the Lilly drug, at 72 weeks, it was 6.4% incremental weight loss. That's proof.
You hold onto muscle, you're going to burn more fat. Hitting incremental weight loss and preserving function will make this a very remarkable drug.
Okay. The reason for not gaining weight is just muscle, more energy expenditure?
That's right.
Okay.
You're breaking the PLATEAU. You're burning fat. You're substituting fat for muscle.
Okay.
You're getting a better fat loss, better adiposity loss with the combination.
Okay. I believe you're doing an interim analysis as well in QUALITY.
That's right.
What was the rationale to do that, and what would be deemed a positive result?
We decided to put in, it's a 68-week-long trial. We put at 32 weeks an interim look at lean mass and fat mass measured by DEXA. Weight is not in the interim look, so we're not going to take a statistical hit. But by doing it that way, it gives a temperature check of what's happening midway in the study. What we hope to see, and we expect to see, that lean mass will be better, will be preserved, and more fat loss. If we see that, then we're on our way to a good 68 week. That's the way to think of it. Then we're going to feel more bullish, of course, going to 68 week.
Okay. Got it. If this trial is positive, what could be a next step for this program? Like phase III, but you also need points for that, yeah.
Well, first let me summarize a little bit and say that, one, people are now recognizing more than ever that older patients are at risk. We don't have to have that argument anymore. We are focusing on an indication that the FDA would agree to for a label, and that is how we are running our clinical program. We are moving away from, it is nice that we can preserve muscle to, this is what it is going to take to have a label. The other thing that has happened is we have an interim look that is going to be coming first quarter of 2027, so the near-term milestone, and the trial is fully enrolled with 239 patients. Furthermore, we have a clinical supply agreement with Novo Nordisk.
In that clinical supply agreement, we get a drug for the trial, but they also get a chance to see what we are doing, and we have direct access to information going back and forth. They also have a first ROFN if the company decides they want to do a licensing deal or more. That is not just for Wegovy. It is for any of the Novo products in combination with enobosarm for any indication. That is a big deal. Also, which is important to mention, is September 1st, we got our first issued patent
for the GLP-1 in combination with enobosarm from the U.S. Patent Office, which means we now have coverage till 2044, for that combination, for enobosarm to be given in combination with semaglutide, enobosarm in somebody who has already been on semaglutide or got into trouble, or enobosarm to stop the rebound weight gain or to build muscle after you stop the semaglutide. So that is a big deal. Again, it is a massive market. What is in store next is when we get the data, is hopefully we will be in a prime position for a strategic move.
Okay. The Novo ROFN that comes after the phase II-B is positive. How long is the
Anytime.
Okay.
Anytime.
How long is the ROFN? What the timing is?
We'll have 90 days to-
90 days.
[inaudible]
Got it.
That's pretty good. I think we've covered all the bases, from the intellectual property to the trial, to why the trial's being designed the way it's being designed, and the fact that we have an external pharma agreement. I think we've positioned ourselves in a great place to be as we move in towards the interim look.
You talked about the IP as well, the new patent. What does it entail in terms of the combination? What are the strengths of that patent?
The strength of the patent is it's enobosarm in combination with semaglutide, enobosarm before semaglutide. Meaning that if you are on semaglutide and you got into trouble, you can take enobosarm to rescue you. Enobosarm after semaglutide, you're onto semaglutide, and you've lost muscle, and you want to gain it back with a rescue. Or the combination, where you prevent it to begin with. And it's for preservation of muscle, burning more fat, losing more weight, building bone. All that's covered in the patent.
It's the same method of use?
Method of use.
Okay.
Our composition matter patent goes to 2035 with the PTO. This will help. Plus, we also have a patent for the new formulation, and that goes to 2046.
What is the new formulation about?
As we have reported, the new formulation is an oral change in the CMC of the oral enobosarm.
Got it. You talked about the strategic interest. I guess, just broadly, muscle preserving drugs, we've gone through ups and downs in terms of interest from the investment community as well as whether it was a real market or not, maybe a trivial market, but pharma may or may not be interested. So what's your take on the strategic interest in
Let's take a step back.
Yeah.
It's a great question. This is how I view the market right now. Right now, you have two players. That's it, Novo and Lilly. And those two players, between the oral and the injectables, have staked out between 15% and 28% weight loss. There are about 70+ companies trying to get into the weight loss space, okay? If they come in and their weight loss is less than 15%, note to toast. If their weight loss is greater than 28%, God bless them. If it's between 15% and 28%, they're generic. They have to do something different.
So the way to think of enobosarm in a strategic space is that when people start realizing that they're going to have to do something else, either a combination or a safety play or a formulation play like convenience, otherwise they'll be a generic, I think it will be very interesting.
Got it. Maybe just one last question. On the current cash, what's the current runway? What does it cover?
As of June 30th, we had approximately $24 million in cash. That cash will take us into mid-2027, so we will get beyond the interim look. And we believe that between the interim look and moving to that phase, we will generate a lot of enthusiasm and interest.
Got it. Well, that is all the time we have today.
Right.
Thank you, Mitch, for giving us a great overview of the company, and thank you for coming to the conference.
Thank you for having me. Appreciate it.