AbCellera Biologics Inc. (ABCL) Q1 2026 Earnings Report, Transcript and Summary

Good afternoon, and welcome to AbCellera's Q1 2026 Business Update Conference Call. My name is Ben, and I will facilitate the audio portion of today's interactive broadcast. [Operator Instructions] At this time, I would like to turn the call over to Tryn Stimart, AbCellera's Chief Legal and Compliance Officer. You may proceed.

Thank you. Hello, everyone. Thank you for joining us for AbCellera's First Quarter 2026 Earnings Call. I'm Tryn Stimart, AbCellera's Chief Legal and Compliance Officer. Dr. Carl Hansen, AbCellera's President and CEO; Dr. Sarah Noonberg, AbCellera's Chief Medical Officer; and Andrew Booth, AbCellera's Chief Financial Officer, are speaking on today's call. During this call, we may make statements about our strategic priorities and financial outlook based on our current expectations and in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Our statements are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from those described. Please review the Risk Factors section of our most recent Form 10-K and subsequent 10-Q filings with the SEC for a more detailed discussion of these risks. AbCellera assumes no obligation to update any forward-looking statements to reflect events or circumstances after today's date. Our presentation today, our earnings press release and our SEC filings are available on our Investor Relations website. The information we provide about our pipeline is intended for the investment community and is not promotional. As we transition to our prepared remarks, please note that this call is being recorded and will be available for replay on our Investor Relations website and that all dollars referred to during the call are U.S. dollars. After our prepared remarks, we will open the lines for question and answers. Now I turn the call over to Carl.

Thanks, Tryn, and thank you, everyone, for joining us today. 2026 has the potential to be a big year for AbCellera. We started the year in a strong financial position with our platform and large infrastructure projects substantially complete and with our internal pipeline set up for multiple catalysts over the next 24 months. Our key priorities for the year include delivering top line data readouts for ABCL635 and ABCL575, advancing ABCL688 and ABCL386 through IND-enabling activities and adding at least one new development candidate to our pipeline. In January, on the strength of early biomarker data and safety data, we announced that our lead program, ABCL635, had moved into Phase II testing. By far, the most important data readout in 2026 will be the top line readout of this study, which is anticipated in Q3. On today's call, we are excited to present interim Phase I data for this program. As a reminder, ABCL635 is a potent antagonists of NK3R, a GPCR target that has been clinically validated for the treatment of vasomotor symptoms, also known as hot flashes. It is the first GPCR-targeting antibody from our platform to advance into clinical testing and is being developed as a potential first-in-class antibody medicine for the nonhormonal treatment of moderate to severe hot flashes associated with menopause. We believe ABCL635 has potential to address a large need and market opportunity in women's health. For most women, hot flashes are the most problematic symptoms of menopause. They can be highly disruptive to sleep, to work and to family life and present a significant burden that persists for a median of over 4 years. At any given time, it is estimated that more than 12 million women in the U.S. experience moderate to severe VMS, of which more than 6 million will seek treatment. Menopause hormone therapy, which is an effective treatment and currently the standard of care, is unsuitable for at least an estimated 20% of these women because of contraindications, tolerability and other factors. As a result, we believe there are over 1 million women in the U.S. who could benefit from safe and effective nonhormonal treatments. Assuming only price parity with approved small molecule NK3R antagonist, we estimate the total addressable U.S. market for non-hormonal VMS treatments to be at least $6 billion annually. From this, we believe there is upside potential in pricing as well as in broader use by patients who experience VMS caused by cancer treatments that reduce hormone levels. This includes patient populations in breast, ovarian and prostate cancers. ABCL635 aims to provide a treatment option that has efficacy comparable to small molecules, a differentiated safety profile without the need for liver enzyme monitoring and an advantage in dosing convenience with once-monthly subcutaneous self-injection. And now I'll ask Sarah to present details about the program and our interim Phase I results. Sarah?

Thank you, Carl. I'll now discuss the Phase I data that led us to advance ABCL635 into Phase II development. The Phase I first-in-human trial was a randomized, double-blind, placebo-controlled 2-part study designed to evaluate the safety, pharmacokinetics and pharmacodynamics of ABCL635 in healthy volunteers. In Part A, single ascending doses of ABCL635 or placebo were evaluated in 40 healthy men and postmenopausal women divided into 5 cohorts. Each cohort contained 8 participants, 6 randomized to ABCL635 and 2 randomized to placebo, and each cohort included both men and women. Participants were administered a single subcutaneous dose of study drugs ranging from 30 milligrams to 900 milligrams and followed for approximately 20 weeks. The unblinded data from the single ascending dose portion is available and will be discussed today. In Part B, multiple ascending doses of ABCL635 or placebo were evaluated in 16 postmenopausal women. Participants received monthly doses of 300 milligrams or 600 milligrams every month for 3 months and then followed for 20 weeks after the final dose. Data from the multiple ascending dose cohorts are still blinded as the final follow-up visits are still ongoing. This slide outlines key demographic characteristics of our study population in the single ascending dose group. Of the 40 healthy participants, there were 30 participants across 5 escalating dose cohorts in the total ABCL635 group and 10 participants in the pooled placebo group. The study targeted healthy adults between the ages of 40 and 65 with a median age in the mid-50s across treatment and placebo groups. We included both men and postmenopausal women in the study. And while the total ABCL635 population had a greater percentage of women and the pooled placebo group had a greater percentage of men, it is important to note that every individual cohort included at least 2 male participants treated with ABCL635, which is important for evaluating pharmacodynamic endpoints. The vast majority of participants across all cohorts were Caucasian. Baseline body mass index or BMI was consistent across most groups with the exception of the 900-milligram group, where we observed a lower median weight and accordingly, a lower BMI. We don't believe this difference had a meaningful impact on the study's overall conclusion. In terms of safety, across all cohorts, treatment with ABCL635 was generally well tolerated. To date, there have been no reports of serious adverse events, severe adverse events or adverse events leading to discontinuation. And notably, we have observed no adverse events of liver toxicity, which is an important differentiator for this program. The overall incidence of any adverse event occurring in the study was 50% in both the total ABCL635 treatment group as well as the pooled placebo group, and the vast majority of reported adverse events were grade 1. The table displays all adverse events reported in at least 2 participants over the study period regardless of relationship to study drug. The only potential signal identified was self-limiting headache, specifically clustered in the 900-milligram cohort. These events were generally mild in severity, typically occurred within the first 1 to 2 days post administration and resolved without complication. It is noteworthy that there were no adverse events of headache reported in the 600-milligram cohort. Injection site-related adverse events were infrequent across both treatment groups and gastrointestinal symptoms such as diarrhea occurred at low frequencies and showed no clear dose dependency or increase over placebo. In addition, a blinded safety review of the ongoing multiple ascending dose portion of the study suggests no new safety signals. As with the single ascending dose portion, to date, there have been no reports of serious adverse events, severe adverse events, adverse events leading to discontinuation or liver-related adverse events. Looking a bit closer at liver-related safety. This slide displays liver function laboratory tests over time following treatment with escalating doses of ABCL635 in the single ascending dose portion of the study. Overall, mean AST, ALT and bilirubin values remained stable following administration of ABCL635 with no dose-dependent findings. The dotted lines on each graph represent the mean upper limit of normal, so these values are very reassuring as our blinded reviews of liver function tests in the multiple ascending dose portion of the study. Switching gears to pharmacokinetic data, we see that ABCL635 exhibited favorable linear pharmacokinetics across doses with overall low variability. As illustrated in the left panel, the systemic exposure of ABCL635 is approximately dose proportional, providing a predictable profile for dose selection in future studies. The estimated half-life of 635 is approximately 24 days, which we believe supports a monthly dosing schedule. The right panel displays the data from our multiple ascending dose portion of the study with 300 milligrams administered every 4 weeks. The profile confirms that ABCL635 behaves consistently upon repeating doses and analysis of our 600-milligram repeat dose cohort is currently underway. While immunogenicity assays have not yet been run, the overall PK profile and general consistency in observed clearing rates is reassuring. Before moving into Phase I data on pharmacokinetics, it is worth reviewing the biology of NK3R, particularly in the KNDy neurons located in the hypothalamus. In addition to being centrally involved in the physiology of VMS, KNDy neurons are centrally involved in the regulation of the sex hormone through their effect on pulsatile GnRH secretion. GnRH then acts on the pituitary to release FSH and LH, which then stimulate estrogen and testosterone release from gonadal tissues. These KNDy neuron functions are mediated by neurokinin B binding to the NK3 receptor. Therefore, the ability to block NKB/NK3 receptor signaling can be measured by evaluating the downstream effects of blocking GnRH release, namely circulating levels of estrogen or testosterone. While measuring testosterone levels in postmenopausal women is challenging due to low and variable levels within and between individuals, measuring testosterone levels in men provides a more stable surrogate marker to evaluate NK3R target engagement of KNDy neurons. Use of testosterone levels in men was previously validated as a biomarker of NK3R target engagement in the early development of the oral small molecule fezolinetant as part of Phase I studies. The figure on the right, adapted from the 2016 paper shows dose-dependent testosterone suppression following a single administration of fezolinetant at doses ranging from 12 milligrams to 180 milligrams. This data provides a useful benchmark of NK3R target engagement and along with subsequent Phase II studies allows us to evaluate how doses associated with different degrees of NK3R target engagement have translated into efficacy on VMS outcomes. So the enrollment of men into our single ascending dose study was important for us to address a key scientific question of whether an antibody could access NK3R in the hypothalamus and have an analogous effect on serum testosterone suppression. Importantly, we went into the study with the belief that the region of the hypothalamus where the KNDy neurons are predominantly located, namely the infundibular nucleus, was not fully behind the typical blood-brain barrier, consistent with the function of KNDy neurons in sensing hormone levels from the systemic circulation. We have seen favorable data in nonhuman primates suggesting that these neurons were accessible to an antibody, but it was important for us to derisk this scientific question early on in clinical studies. With that background, this slide displays testosterone data over time for single doses of ABCL635 on the left as compared with data adapted from the published study of fezolinetant on the right. Data in both figures have been transformed to display the placebo-adjusted percent change in testosterone from baseline. This is particularly valuable for the fezolinetant data given the natural diurnal changes in testosterone levels that occurred during the course of a 24-hour period. As seen on the left panel, a single dose of ABCL635 resulted in sustained dose-dependent testosterone suppression in men over a 4-week period with ultimate recovery to baseline by 8 to 12 weeks. By comparison, a single dose of fezolinetant resulted in transient dose-dependent suppression of testosterone over a period of hours with recovery to baseline within 24 hours. It's noteworthy that the approved dose of fezolinetant 45 milligrams was associated with a transient decrease of testosterone to a maximum of 50% of baseline values over several hours. By contrast, doses of 300, 600 and 900 milligrams of ABCL635 were associated with sustained reductions of testosterone levels of between 50% to more than 75% for several weeks. Consistent with these findings of NK3R antagonism in controlling the hypothalamic pituitary gonadal axis of testosterone, ABCL635 demonstrated dose-dependent suppression of the pituitary hormones, FSH and LH with clear effects at 300, 600 and 900 milligrams. Based on these pharmacodynamic data, we feel confident that ABCL635 is able to reach the KNDy neurons in the infundibular nucleus, and we have addressed an important scientific risk for this program. So in conclusion, the unblinded interim data from the single ascending dose cohort demonstrated that ABCL635 has a favorable tolerability profile, a PK profile that supports monthly subcutaneous dosing and strong and sustained target engagement that meets or exceeds levels previously published for the approved small molecule fezolinetant. With these data, we moved quickly to initiate Phase II trials in January of this year. We selected a 600-milligram subcutaneous dose administered once because we believe it best approximates exposures of 300 milligrams at steady-state dosing and could be a feasible loading dose to initiate therapy and potentially maximize early effects on VMS. Our efforts are now focused on executing on the Phase II portion of the study in order to evaluate the efficacy of ABCL635 on the frequency and severity of VMS, which are the same endpoints we would expect to use in late-stage clinical development. The study is a randomized, double-blind, placebo-controlled multicenter study of approximately 80 patients with moderate to severe VMS. Overall eligibility criteria were designed to be comparable to what has been published for the approved small molecules during Phase III testing. Participants are randomized 1:1 to receive a single dose of ABCL635 at 600 milligrams or a matched placebo. The primary efficacy endpoint is at 4 weeks, although patients will be followed for an additional 8 weeks to evaluate the relationship between drug concentrations and efficacy and to facilitate building a PK/PD model. Following the initial 12-week placebo-controlled treatment period, all participants will have the option to enter an open-label extension where they will receive a 600-milligram dose. The study is enrolling well, and we are currently on track to release top line efficacy and safety data in Q3 of this year. Following that announcement, we intend to present additional data at upcoming medical conferences. We believe success in the Phase II portion of this study would be highly derisking for the program. So as a result, we have already begun planning for next steps, which would include a late-stage clinical development program for ABCL635 in treating moderate to severe VMS associated with menopause as well as additional studies to evaluate the potential for ABCL635 to improve VMS associated with common breast cancer and prostate cancer treatments. I'll now pass the presentation back to Carl for highlights about our broader pipeline and upcoming catalysts.

Thank you, Sarah. Obviously, we are more than pleased with the Phase I data for ABCL635, and we look forward to top line results for the ongoing Phase II study, which remains on track for Q3. Turning to the broader portfolio. The top line Phase I readout for our second clinical program, ABCL575, is expected in Q4 of this year. As previously discussed, ABCL575 is a potential best-in-class OX40 ligand antagonist. From the outset, our strategy has been only to complete Phase I studies prior to partnering it. At present, we have no plans to develop it past Phase I. Beyond ABCL635 and ABCL575, we are on track to have up to 3 additional clinical stage programs by the end of 2027. This includes our 2 undisclosed programs, ABCL688 and ABCL386, both of which we believe are compelling opportunities in large markets. We expect both programs will start clinical development in Phase I/II studies with a clear path to achieving early proof of concept in patients. We'll disclose more information on these programs as they enter clinical studies. And finally, we are working towards selecting our fifth development candidate in the first half of this year. Although we still have work to complete, we are on track to deliver on this goal. And with that, I will hand it over to Andrew to discuss our financials. Andrew?

Thanks, Carl. As Carl pointed out, AbCellera continues to be in a strong liquidity position with approximately $530 million in cash and equivalents and with roughly $125 million in available committed government funding to execute on our strategy. We are continuing to execute on our plans with a focus on internal programs and leveraging our process development and clinical manufacturing investments. Looking at revenue and expenses. Revenue for the quarter was around $8 million compared to a total revenue of approximately $4 million in the same quarter of 2025, in both periods, consisting mostly of research fees. With respect to research fee revenue and as we have indicated in the past, we expect this to generally trend lower as we focus on our internal pipeline. Our research and development expenses for the quarter were approximately $47 million, approximately $4 million more than last year, and this expense reflects the focus of investment in our internal programs. In sales, general and administration, expenses were approximately $12 million compared to roughly $19 million last year. The greater than 35% decrease in SG&A expenses relates to the conclusion of our intellectual property litigation and to changes in teams following the focus of our internal pipeline. Looking at earnings, we are reporting a net loss of roughly $43 million for the first quarter of 2026 compared to a loss of about $46 million a year earlier. In terms of earnings per share, this result works out to a loss of $0.14 per share on a basic and diluted basis. Turning to cash. Operating activities for the first quarter used approximately $34 million in cash and equivalents. Excluding marketable securities and all other investment activities, it amounted to only $3 million in the quarter. This is consistent with the substantial completion of our large investments in facilities and manufacturing capabilities that finished in 2025. As a part of our treasury strategy, we have $428 million invested in short-term marketable securities, and our investment activities for the quarter included a $23 million investment in these holdings. Altogether, we finished the quarter with $531 million of cash, cash equivalents and marketable securities, a $30 million decrease in the cash -- in cash for the first quarter of 2026. As a reminder, we have received commitments for funding for the advancement of our internal pipeline from the Government of Canada's Strategic Innovation Fund and the Government of British Columbia. This available capital does not show up on our balance sheet. And with over $530 million in cash and equivalents and the unused portion of our secured government funding, we have approximately $655 million in available liquidity to continue to execute on our strategy. In addition, we have further available liquidity from our ownership of another Vancouver lab-based lab and office building as well as our GMP facility. With respect to the overall company expenditures, our capital needs are very manageable. We continue to believe that we have sufficient liquidity to fund at least the next 3 years of pipeline investments. And with that, we'll be happy to take any questions. Operator?

[Operator Instructions] Your first question comes from the line of Stephen Willey with Stifel.

Just curious as to -- as you look at the level of testosterone suppression you're able to achieve with both the 300 and 600 mg doses. I know you talked about maybe there being a loading dose strategy that could be pursued. But I guess I'm just interested in now that you've seen the testosterone suppression and I guess what you know about the testosterone as a pharmacodynamic marker in terms of what we've seen from some of the small molecule antagonists, what is your opinion as to whether or not you think that those drugs are leaving efficacy on the table? And do you think that a rationale for better efficacy could be potentially displayed in the 4-week VMS severity and frequency data?

Great question, Steve. Carl here. So first, I want to highlight that this study is really focused on evaluating target engagement on NK3R in the infundibular nucleus. And so we think that the biomarker reading reports on that directly, but it is not a direct report on efficacy. So speculating on what the ultimate efficacy will be, it's difficult to resist that, but that's exactly what we're running the Phase II study for and what we're going to know in Q3. Furthermore, our view, our base TPP and our commercial assessment is that what is really a winning product and potentially a blockbuster would be a product that has efficacy that is comparable or equal to the small molecules, a cleaner safety profile without liver monitoring and a more convenient once-monthly subcutaneous injection. And so from that perspective, that's the bar. If we see that or something that is -- that supports that in Q3, we are celebrating. We do think that there's a strong scientific case based on the target engagement that we've seen that we might do better, but there's still science that needs to be crossed. And I don't want to get in front of that because that's precisely why we're doing the study that reads out in Q3.

All right. Understood. And then maybe just a quick follow-up. As you think about what the next development step for 635 might be, I know you're talking about this being "late-stage" development. But do you feel like you will have done a sufficient amount of dose optimization work to potentially move directly into a Phase III study in 2027?

Stephen, this is Sarah. I think we will take a look at that proof-of-concept Phase II readout. And part of the reason that we're following subjects for 12 weeks is that we really can build a robust PK/PD model, looking at efficacy over time as drug concentrations continue to fall. And that will give us a good sense of how these drug concentrations relate to efficacy. We believe with that data in hand and with a clear validated mechanism of action, we have a great position to stand on to engage regulators with the late-stage development programs. It may be that regulators may want us to test an additional dose in Phase III, which I don't think we would be completely averse to, although I doubt that we're going to need to do that with the data at hand, but that will be a regulatory discussion.

Your next question comes from the line of Evan Seigerman with BMO Capital Markets.

Two for me. One, the testosterone data you shared is obviously very strong. Help us contextualize how this could translate into benefit in patients with VMS. And you had mentioned potentially expanding indications beyond VMS into -- VMS into oncology. How should we think about that potential opportunity?

Thanks, Kevin. Pardon me, Evan, I will -- this is Carl here. I'll start with the first question, and then I'll hand it off to Sarah. Your question is similar to Steve's. So if you look at the published clinical development data from fezolinetant, there's pretty good data to make a correlation between target engagement as measured by suppression of testosterone levels and efficacy. And so that is data that we've been looking at. And it's one of the reasons we think there's a strong case for increased target engagement, giving better efficacy. The caveat on that is that, that -- those experiments are done with small molecules. And so the correlation that is seen with small molecules may or may not translate to an antibody. And that's particularly the case because there is NK3R expressed in another part of the brain that is relevant. That's the preoptic nucleus, where we don't have a direct read on target engagement. And so while we are very encouraged and we believe we are hitting NK3R on the critical neurons, which are the KNDy neurons, there is still scientific risk to cross. And that's -- as I said to Steve, that's why we're running the Phase II. If that data comes in the way that we would like, then I feel the program is highly derisked and then we would be moving quickly to develop further. And I think that's the second part of your question that I'll hand off to Sarah.

So next steps from here in addition to moving into late-stage development in VMS associated with menopause, we also believe there's considerable upside and value for patients in treating induced menopause that's associated with various cancer treatments. So for breast cancer, this would be treatment with tamoxifen or aromatase inhibitors or oopherectomy where you have a chemically or surgically induced state of menopause, which can give rise to particularly severe VMS symptoms. In prostate cancer, treatment with androgen deprivation therapy and really androgen receptor antagonist and other therapies that decrease hormonal levels similarly give rise to the same symptoms of hot flash. So we believe and the oral small molecules have also begun to evaluate this further as well that there is benefit for patients beyond those associated with naturally occurring menopause.

Your next question comes from the line of Kripa Devarakonda with Truist Securities.

Congratulations on the data. A couple of questions from me. One, the Phase II dose of 600 mg once was -- you mentioned that it was selected because it approximates the predicted Cmax at steady state for the 300 mg regimen. Just remind us how you came to that decision. More importantly, is there a risk that the single dose of 600 milligram fails to maintain the testosterone suppression floor at the end of the 4-week window in the Phase II trial? Any risk there? And the second one is the 600 mg dose seem to have a lower AE rate. Is this simply a case of small cohorts and not to read too much into it? Or could this be -- given what you've seen with the 900-milligram and the 300-milligram group, is this truly somehow a sweet spot for the tolerability profile?

Thanks, Kripa, and I appreciate your question. I think in terms of the durability effects over 4 weeks, both our PK data showing our 24-day half-life as well as the PD data showing sustained target engagement and testosterone suppression. We do believe that 4 weeks is going to be a good time period for being able to evaluate efficacy. Obviously, the results of that Phase II study will tell us conclusively as we're measuring VMS at every week throughout the 12-week period. So we'll be able to answer that. In terms of the AE rate that you mentioned, I expect that it's small numbers. We didn't see much in the way of safety findings at 600, although the 900-milligram cohort, it's hard to know if this is a real finding. These events of headache, they occurred on day 1 and day 2, which really isn't when you have maximal exposures and often in a Phase I setting, these are individuals that haven't necessarily slept well in a dormitory-like setting, and they're not able to have coffee in the morning. And so headache is often a common adverse event across different cohorts in studies. It is also worth noting that in the placebo patient with headache, that was also a 900-milligram patient. So it's possible that this is a real safety signal. It's also possible that it's just small numbers. But clearly, our safety at 600 milligrams is very reassuring.

And I'll just add to that, that -- I was just going to add to that, that if you look at the biomarker data, there's the testosterone, the LH and the FSH and all of those show at the 600-milligram dose, we have robust suppression over the full dosing window. And so that is approximately the dose that we would expect in steady state with the 300. And 300 is also one that is easily compatible with a commercially available auto-injector at 2 milliliters. So all of those things together have factored into the decision to take the 600 forward.

Your next question comes from the line of Allison Bratzel with Piper Sandler.

Maybe just a follow-up on some of the earlier questions. Just could you clarify the rationale for capping the multiple ascending dose trial at 600 mg? Was that based on a ceiling effect on target engagement or because of the headaches we saw or just some other reason? And then just on the multiple ascending dose data, I think you indicated that remains blinded. Could you just clarify if we should expect to see any of that data before the Phase II efficacy readout in Q3 or see that concurrently? Or just what's the status on that?

Yes. Thanks, Allison, for the question. In terms of the 600 milligram for the MAD cohort as the top cohort, we selected that mainly because really that starts to approximate very high exposures far beyond what we felt like we would need or even be commercially viable to take forward into late-stage development. This is really to provide a safety window at exposures that we feel are appropriate to take forward and not because of any safety signals. There was no dose-limiting toxicity that we saw across the study. And then in terms of your second question in terms of the -- can you repeat your second question?

Yes. It was just on if we'll see data from the multiple ascending dose portion of the Phase I.

We don't expect to share that. But as I say, we can look at blinded safety data, and we really have just the final safety follow-up visits ongoing. And so we don't expect much to change, although because it is still ongoing, we haven't unblinded. But no, we don't expect to unblind that before the Phase II readout.

Your next question comes from the line of Brendan Smith with TD Cowen.

I guess maybe just to put a pin in this conversation just to make sure I'm understanding, I guess, biologically what the goal is here. Since I guess, looking at the testosterone curves like on Slide 12, you're still getting well over 50% reduction out at 4 weeks on that 600 mg dose. So is it fair to say ultimately the goal is kind of reduce that testosterone and then maintain that lower level at a steady state? And so the idea being that you wouldn't want to extend that dosing window even longer potentially just to make sure that it stays down there? Or is there actually kind of an optionality moving forward to kind of whether that's 5, 6-plus weeks? Just help us understand kind of the over under on that.

Yes. I think the goal is prolonged, stable target engagement over the course of the dosing period. We believe that based on the PK, that dosing period of every 4 weeks is appropriate. But because we're following patients for an additional 12 weeks or a full 12 weeks after treatment, we will see if efficacy is maintained beyond that 4-week period that would make us think differently about our dosing regimen. But at this point, given the sustained target engagement at 600 and what we believe would be associated with 300 steady state, we think that, that's sufficient for a monthly dosing. But obviously, the Phase II data will tell us a little bit more.

Okay. Got it. And then if I could just quickly follow up for the 2 preclinical assets, 688 and 386, I understand it's still in IND-enabling studies now, but can you -- do you have a sense of if one would come before the other in terms of clinical starts next year? Or are they roughly kind of on the same time frame for '27?

Carl here. They're advancing well. I think we're not prepared yet to make a call as to which one is going to meet the clinic first, but we'll give you an update on that as things progress.

Your next question comes from the line of Debanjana Chatterjee with Jones.

Congrats on the data. So I understand that the MAD portion remains blinded and you cannot speak in detail. However, since those are postmenopausal women with or without VMS, I'm curious if you have been collecting any kind of PRO data from the women either in the SAD or the MAD. And if you could speak to any trends of benefit on VMS symptoms that you are seeing?

Although we are treating postmenopausal women and some of them do have VMS, we don't collect efficacy in the multiple ascending dose portion. We don't have the same eligibility criteria, and we certainly are not implementing the diaries that we have saved for Phase II, and we expect a very robust answer from that Phase II in Q3.

And I have another follow. So in the MAD data you have shared for the 300-milligram dose every 4 weeks, we can see some drug accumulation effect over time. So for the 600 mg, as we think about chronic dosing, what kind of PD impact are you expecting? And do you think that there is even room for higher PD engagement? And does it have any implications for the risk-benefit ratio when we think about chronic dosing?

I would say that the 600, 300 and 900 all show very robust target engagement. And with a small number of participants tested, it's really hard to say that there is further target engagement that we are likely to see. When we compare, particularly over the course of many weeks compared to 45 milligrams of fezolinetant, we feel very comfortable that our degree of target engagement, at least in the KNDy neurons, the infundibular nucleus, that is going to be sufficient. We don't necessarily believe that we're going to need to go higher. Clearly, with steady-state dosing, we'll get some higher exposures. So that's also why we're thinking about this loading dose strategy so that we can really be able to treat VMS quickly within the first potentially a week to 2 weeks.

And I'll just add to that. As Sarah mentioned in the prepared remarks, the half-life of the antibody is just under a month. So a monthly dosing at 300 would get an accumulation that starts to approximate what you see in the 600-milligram dose. And that's just, as Sarah just said, starting with the 600-milligram dosing and then continuing with 300 once monthly so that you get to that maximum efficacy right away and then you can hold a steady level through treatment.

Your next question comes from the line of Steven Seedhouse with Cantor.

I wanted to ask about the -- first of all, the placebo group in the comparator VEOZAH testosterone experiment had some transient reduction in testosterone in the 24-hour follow-up. And I think you noted, obviously, that's typical, the diurnal variation that would be expected. So that makes sense. But I'm curious what you saw in the placebo arm of your SAD. And I just wanted to confirm if it was basically unchanged at steady state. And then also wanted to confirm, are you measuring testosterone given this dynamic at the same time each day at each measurement? Or is it averaged for multiple measures throughout each day? Just want to confirm that protocol as well.

Sure. So to start with your second question, yes, we try to measure testosterone roughly at the same time each day. These are participants that are coming into the clinic rather than housed at the clinic. So it's not exactly, but morning testosterone each visit is what we aim for, and I think what we were able to achieve. In terms of the placebo group, we didn't do serial measurements over 24 hours in the same way. But with an antibody, with that sustained target engagement that we were able to see, we did not see any appreciable effects in the placebo group.

Okay. And I also wanted to ask about the onset of action here with the antibody. So with testosterone basically decreasing throughout the first week post treatment, was that expected, number one? Do you think that's a function of the bioavailability in -- at the KNDy neurons in the hypothalamus or something else? And what is this target engagement sort of kinetic that you're seeing compared to VEOZAH, which the nadir was like 8 hours post dosing sort of tell you about what's going on with the pharmacology here.

Yes. I would say the main difference is just the time it takes to get to Cmax with a subcutaneously administered antibody versus an oral small molecule where the Cmax occurs relatively quickly. So it is going to take some time for absorption and to reach the site of interest at the peak level. And I think that's really the only difference. I think the fezolinetant data shows that the difference between PK and PD is very quick.

There are no further questions at this time. I will now hand the call over to Carl Hansen for closing remarks. Carl?

Thank you, everyone, for joining the call today. We are excited about the progress, and we look forward to updating you in the future. Thanks so much.

This concludes today's call. Thank you for attending. You may now disconnect.