BioCryst Pharmaceuticals, Inc. (BCRX) Q3 2016 Earnings Report, Transcript and Summary

Good day, ladies and gentlemen, and welcome to the BioCryst Third Quarter 2016 Earnings Conference Call. At this time, all participant lines are in a listen-only mode to reduce background noise, but later we will be holding a question-and-answer session after the prepared remarks and instructions will follow at that time. [Operator Instructions] As a reminder, today’s conference is being recorded. I would now like to introduce your first speaker for today Robert Bennett. You have the floor, sir.

Good morning and welcome to BioCryst third quarter 2016 corporate update and financial results conference call. Today’s press release and accompanying slides for this call are available on our website at www.biocryst.com. At this time, all participants are in a listen-only mode. Later, we will open up the call for your questions and instructions for queuing up will be provided at that time. Joining me on the call today are Jon Stonehouse, Chief Executive Officer; Tom Staab, Chief Financial Officer; Dr. Bill Sheridan, Chief Medical Officer. Before we begin, I will read a formal statement as shown on slide 2 regarding risk factors associated with today’s call. Today’s conference call will contain forward-looking statements, including statements regarding future results, unaudited and forward-looking financial information, and company performance or achievements. These statements are subject to known and unknown risks and uncertainties, which may cause our actual results, performance or achievements to be materially different from any future results or performance expressed or implied in this presentation. You should not place undue reliance on the forward-looking statements. For additional information including important risk factors, please refer to BioCryst’s documents filed with the SEC, which may be found on our company website. With that, I will turn the call over to Jon.

Thank you, Rob. Good morning and thanks for joining us today. In the third quarter of this year, we were able to extend our cash runway into 2018 by bringing in approximately $23 million in debt financing. Our intent with this financing was to bring forward payments we expect to receive over the next few years on RAPIVAB, as this money is more valuable to us now than spread out over the next three years. In addition, we’ve been focused on the execution of the APeX-1 trial. Recruitment is starting to pick out and as of last Friday we’ve screened 19 patients with only two screen failures so far. As of last Friday, 16 subjects were randomized and we expect screening and enrollment to continue to increase over the next few weeks. As a reminder, our target enrollment for the interim analysis of Part I is 24 patients, with an option to expand to 36 patients. Our targets for completion of Part I was the end of the year which was an aggressive target. Given where we are with the enrollment and the fact that we don’t want to sacrifice quality for speed, we are changing our guidance of reporting out results of Part I to the first quarter of 2017. I’ll now turn call over to Bill who will give a more detail update on some of our programs. Bill?

Thanks, Jon and good morning everybody. Jon described the current status of screening and enrollment in APeX-1 trial, BCX7353 for prophylaxis of angioedema attacks in patients with HAE. Our teams focus right now is on completing recruitment and dosing in this study. But my tools will provide a general program update, covering nonclinical safety and clinical pharmacology work supporting the development of 7353. The nonclinical safety program for this drug is now well advanced, with progress in three work streams. First, we recently completed nonclinical reproductive safety studies. These studies showed that there were no adverse findings on either fertility or embryo fetal development. For the ICH regulatory guidance, with these results we can now ease the contraception requirements in APeX-1 which should allow more women of childbearing age to consider participating in the study. Second, the chronic nonclinical safety studies of six months duration in the rat and nine months in the monkey are also wrapping up. These are intended to support long-term dosing of BCX7353 in the clinic and we look forward to using those results to support starting a long-term safety study sometime next year. Third, we’ve also begun the two-year rat carcinogenicity study that is a requirement for small-molecule, new molecular entities. Turning to the clinical pharmacology program, that is also advancing as you would expect to support a new drug applications of 7353, and we are making good progress based on the harmonized international regulatory guidelines. This program consists of a series of small studies in healthy subjects to cover ADME and other required components for new molecular entities, including studies with drug-drug interactions and drug transporters. As these studies will take some time to complete, in APeX-1 we have been appropriately conservative in the eligibility requirements for concomitant medications. As we gain more knowledge, we anticipate that we will be able to progressively broaden this eligibility criterion. Turning to our broad-spectrum antiviral program, we recently completed a follow-on experiment in a non-human primate model of Zika virus infection. Dosing with galidesivir, given either on a loading dose, maintenance dose schedule, or as a single dose, reduced the proportion of animals who had Zika virus in the blood and CSF. Animals were later challenged again with Zika virus, and the frequency of detection and the amount of virus in the blood and CSF was very low. These results indicate that the animals developed an effective immune response to the first virus challenge, and that galidesivir did not interfere with the generation of immunity. The addition of Zika virus as another emerging infectious disease susceptible to galidesivir reinforces its broad spectrum of activity and potential utility as a medical countermeasure. We continue to work with our U.S. government partners, NIAID and BARDA, to complete the work needed for pre-ADUA [ph] readiness status and NDA filing. I will now turn the call over to Tom, who will provide the financial update.

Thank you, Bill. I am pleased report the details of our third quarter 2016 and nine months financial results. We closed the third quarter with $69 million in cash and investments, reflecting proceeds from the recent completion of a $23 million senior credit facility with Midcap Financial. We entered into this non-dilutive financing to provide additional cash runway into 2018, which provides us sufficient cash runway beyond the projected reporting of APeX-1 results, and does so without leveraging our stock. This facility is anticipated to be repaid with the proceeds from U.S. and other government peramivir stockpiling orders, as well as milestone receipts under our Seqirus out-licensing arrangement. On slide 4, you see revenue for the third quarter of 2016 decreased to $7.8 million from $11 million in the third quarter of 2015. The decrease as compared to the third quarter of 2015 was related to lower product sales associated with the transition of RAPIVAB commercialization to Seqirus, as well as lower collaborative revenue associated with galidesivir development under U.S. government development contracts. The decrease in aggregate third quarter revenue was partially offset by higher RAPIACTA royalty revenue associated with $3.5 million in royalties from a Japanese government stockpiling order in advance of the 2016-2017 flu season. Importantly, royalty proceeds from government sales are available to us for general corporate use, and are not dedicated to repayment of obligations under our non-recourse pharma notes. Research and development expenses for the third quarter of 2016 decreased to $14.1 million from $20.1 million in the third quarter of 2015, primarily due to the discontinuation of avoralstat development activities subsequent to OPuS-2 results. The progression of the galidesivir program remains dependent on BARDA and NIAID’s authorization and approval process, as this program continues to be predominantly funded by these two U.S. government agencies. General and administrative expenses for the third quarter of 2016 were $2.8 million, and consistent with the $2.7 million reported in the third quarter of 2015. Moving below the operating line, we incurred $1.5 million of interest expense in the third quarter of 2016, and $1.2 million in the third quarter of 2015. We also recorded a mark-to-market hedge loss of $931,000 in the third quarter of 2016 as compared to a hedge loss of $460,000 in 2015. During the third quarter of 2015, we also realized a currency hedge gain of $108,000 from the exercise of a U.S. dollar/Japanese yen currency option within our foreign currency hedge. This amount reflects a real gain on the exercise of options within our currency hedge that was put in place with the RAPIACTA monetization, as compared to mark-to-market adjustments at the end of each respective quarter, which reflect quarterly changes in the yen/dollar exchange rate. The net loss for the third quarter of 2016 was $11.5 million or $0.16 net loss per share compared to a net loss of $14.6 million or a $0.20 net loss per share for the third quarter of 2015. Slide 5 summarizes our nine-month financial results. For the nine months ended September 30, 2016, total revenues decreased to $17.4 million from $43.7 million in the first nine months of 2015. The decrease in revenue resulted from the recognition of approximately $21.7 million of collaborative revenue associated with the RAPIVAB out-licensing to Seqirus in June 2015; no longer recording product revenue in 2016, due to the Seqirus transaction; and a decrease in collaborative revenue associated with lower galidesivir development. Nine-month 2016 R&D expense decreased to $48.9 million from $53.7 million in the first nine months of 2015. The decrease reflected discontinuation of avoralstat development as well as reduced spending on our galidesivir program. General and administrative expenses for the nine months of 2016 decreased to $8.7 million compared to $10.3 million in 2015. This decrease was primarily due to a reduction in unrestricted grants awarded to HAE patient advocacy groups and an overall reduction in administrative expenses. Moving below the operating line, through nine months of 2016, we incurred $4.4 million of interest expense compared to $3.9 million in the nine months of 2015. We also reported a mark-to-market hedge loss of $7.4 million in the nine months of 2016, as compared to a loss of $793,000 in 2015. In addition, we also realized currency gains of $811,000 and $1.7 million in the first nine months of 2016 and 2015, respectively, associated with hedge option exercises in those periods. Moving on to slide 6, I will spend some time on our cash balance and cash usage. We ended the third quarter of 2016 with cash and investments of $68.7 million, a decrease from the $101 million at the end of 2015, but a $4.4 million increase from the amount at June 30, 2016. The increase was the result of closing our $23 million senior credit facility in late September, which I mentioned in my opening remarks, less cash usage from the normal operations in the third quarter. The senior credit facility bears a variable coupon rate based on the one-month LIBOR, currently at approximately 8.5%, an interest-only period through 2017, and then 40 monthly principal and interest payments, beginning in January 2018, to satisfy the obligation. We anticipate this facility to be repaid from RAPIVAB proceeds associated with our future government stockpiling and milestone proceeds. And we are able to repay the facility at any time in its 4.5 year term. Importantly, proceeds from this facility are projected to extend our cash runway into 2018. Also, the facility bears a reasonable cost of capital of approximately 10.5%. Our operating cash usage for the third quarter of 2016 was $15 million, and was slightly higher than the $12.3 million utilized in the third quarter of 2015. In regards to our 2016 forecasted results, we continue to expect to be within our previous cash guidance of $55 million to $75 million, and have lowered our operating expense guidance range from $78 million to $98 million previously to the new range of $68 million to $80 million. As a reminder, equity-based compensation expense is excluded from our operating expense guidance. That completes my review of the third quarter. We would now like to open the call up to your questions. Andrew?

[Operator Instructions] Our first question comes from the line of Charles Duncan from Piper Jaffray. Your line is open.

Thank you. Good morning guys. Thanks for taking the question. Definitely appreciate, with regard to APeX, the focus on quality over speed. But I am wondering, when you take a look at – I think you may have made a comment that the screened success rate was approximately 90%, similar to previous studies. Wondering really what are the rate-limiting steps to enrollment. Is it the HAE attack rate, or some other factor?

Charles, thanks for the question. This is Jon. Number one – and I said this in the remarks I made – it was a really aggressive timeline, when you look at comparisons to the previous studies that we’ve done. And then I think you add up that the startup activities I think took a little bit longer coming out of the summer in Europe than we expected. And then the entry criteria limited some of the patients in terms of attack frequency and concomitant meds and things like that. So, I think that had an effect, as well. But I can tell you that the momentum right now is good. The number of people that we’re screening and the number of people that we’re randomizing has picked up. And so, we’re confident we’ll hit the 1Q.

That sounds good. Also, though, focusing on the quality comment, is there any color you can provide us, on a blinded basis, or any way to characterize not only the numbers of patients but the characteristics of them being enrolled?

Yes. I think because it’s a small study, you want to make sure that you absolutely have patients with HAE in this study. And occasionally in studies done by others, and even in some of the studies we’ve had, there are some questions. So, Bill has put in, as part of the process, a pretty thorough review of each patient to ensure quality in that we’re really assessing HAE patients.

Okay. That’s great. And then if you could just provide us a reminder of what kind of news flow we could anticipate in Q1 around the completion of Part 1. Would it be top-line data? And how does that relate to a possible expansion of the trial from 24 to 36 patients? Would we know that at that same time?

So, what I will commit to is that we’ll have Part 1 in Q1. What data will report, it will be similar to what we’ve reported out in previous trials that we’ve done. So top line, efficacy, secondary endpoints, safety and tolerability, will all be in that report out. And with success, we will also report that we’re moving into Part 2.

Okay. And then my final question is – I don’t cover Shire, but I’ve heard that it is planning its possible Phase III data to come out with SHP643, perhaps in the second quarter. And I’m just wondering, as you think about the possible outcomes of that study and think about the evolving treatment landscape, how do you see your program as being differentiated? Do you still have good confidence in the potential to provide some value-add?

Absolutely. It’s an oral drug, so everything else that’s being studied that’s ahead of us is injectable. And so, second quarter sounds like a timeline that we had expected with the antibody; so nothing new there. And we’re expecting that the injectables – that the efficacy bar will continue to go up. Because the goal for all of us is to get patients back and restoring the normal phenotype by getting enough kallikrein inhibition in to do that. So, as long as we’ve got good efficacy with an oral once-a-day drug, we think there’s plenty of room for market share for an oral drug.

And so, you still believe that for some of the patients, compliance may be better or at least favored with the oral med.

Yes. We were just with a patient association in Europe this past weekend. We’ve been seeing sites and talking with KOLs. And there is no shortage of enthusiasm for an oral drug, even recognizing that other drugs are getting better efficacy than what we’ve seen in the past. And there is absolutely enthusiasm for an oral drug.

That’s consistent with our diligence, and so I’m sure it’s the case. Thanks for taking my questions. We will look forward to the data.

Thank you. Our next question comes from the line of Brian Abrahams from Jefferies. Your line is open.

Hey, thanks for taking my question. Just a couple more questions on the timelines first. With enrollment picking up, what’s the right way to think about the potential Part 2 timeline to conduct? And then is the goal – would the goal still be to potentially start a pivotal study by the end of next year?

Yes, absolutely. So, it’s hard to estimate how long Part 2 would take, but we’re assuming right now it’s about a quarter. It is six in each arm of drug and then two more placebo, so it’s a total of 40 more patients. So, we think roughly a quarter. And plus we should have pretty good momentum by that point as well. It’s not like we have to start from scratch. We’re not going to stop enrollment for the interim analysis. And then you need the end of Phase II discussions with the regulators, so I think starting it second half of next year makes sense.

Got it. And with the drug-drug interaction and contraception restrictions, would those be fully removed by the time Part 2 would be rolled into, or at least by the time a pivotal study is initiated?

There are two questions there. So on the contraception front, it’s very important for a drug like this one that is going to be administered chronically to women in childbearing ages for treatment of their disease – by the way, women tend to suffer more frequent attacks of angioedema then men with HAE. And that’s probably related to the estrogen effects. And those attacks often either start or get worse around the menarche. And there’s a very long period of time that you would expect people to be taking this medicine. So it’s really important to have a negative reproductive toxicology outcome, which we do, which is good. So, in fact, if there were issues around embryo/fetal teratogenicity or maternal fertility issues, that would call into question making any further progress for a drug in this particular space. So that’s a good outcome. And before you have that information, you are basically asking people to use two highly effective forms of contraception, typically, and that’s just a fairly standard thing for the ICH guidance. Now that we have that result, we can ease that and make it simpler, just with one. So, that will go into effect in APeX-1. I expect it probably will improve the attractiveness of the study to women of childbearing age. The other question you had was around con meds. We’ve started to learn what type of medicines can be given in a straightforward way with our drug. We will progressively up that as time goes by. It may or may not make a huge difference in terms of the enrollment rate in APeX-1. But I’m confident that as the program matures that we will be able to study a lot of other concomitant medications with our drug in a safe way. The goal, at the end of the day, is to have crystal-clear labeling. And this is a very common set of things to have to study in drug development for small-molecule NMEs. If you look at recent labels for a lot of drugs, the labeling is crystal clear about how to dose other medicines in association with that drug. So, it’s just simply a matter of doing the work.

Got it. And then on the quality initiatives, in addition to screening, curious some of the ways – the steps you’re taking to ensure that you confirm – that you fully confirm that an attack has indeed occurred, and it’s not mistaken for a non-HAE-related symptom like abdominal pain. Are there things that you can do that can improve that parameter relative to perhaps other studies that have been conducted in this space? And then just one last question would be for Tom. Just help us understand the cash use or the expense guidance, whether that the reduction in that primarily relates to just a push-out of timelines. Or are there factors as well? Thanks. I’ll hop back in the queue.

Yes, on the first question, the main thing we’re trying to avoid is patients who seem to have a very frequent attack rate, not controlled by prophylactic C1 inhibitor. That has been seen in the Cinryze pivotal study published in the New England Journal of Medicine. There are a couple of subjects whose attack rate simply wasn’t controlled and went up. We had one or two subjects like that in ours, too. It calls into question what is the underlying illness, or is how that particular patient interpreting their symptoms? So, to give a concrete example, if you are having somebody who is infusing Cinryze or Berinert every day, but they’re still reporting three attacks a week, it sort of doesn’t make any sense, and something else is likely going on. So the first step is to have very well-informed investigators who really know their patients, and that takes care of most of the quality with regard to that. The second step is that for every subject entered, we at BioCryst – in other words, the physician in charge of the study at BioCryst – reviews the eligibility requirements. And if there’s any question about attack rate in particular, then there’s a phone call with the investigator, or an email exchange with the investigator to clarify anything. So I think that with those two steps, that takes care of the vast majority of the process that we need in order to make sure that we’re not having extreme outlier and poorly understood attack rate type of subjects in our study. At the other end, we also don’t want – this particular protocol, as we’ve said before, we need to have the opportunity to see attacks in a relatively short time frame, because this study is only in four weeks’ duration. So there’s a two-attack-per-month minimum eligibility criterion. We’ve had experience now in using medical records that are high quality in order to confirm subject eligibility for that. It worked extremely well. And in OPuS-2 we had – we were able to do a comparison with that technique versus a screening run-in period for people who didn’t have any medical records; and the average attack rate and the experience on study with the same, regardless of whether the attack rate was confirmed by medical records or a screening run-in period. So here we are relying on the medical record. It’s a small study, only in Europe; and if somebody doesn’t have a medical record, then they won’t be able to come into the study.

I think, Tom, you were going to –

Yes, so in response to your other question, there’s really two reasons. One is the reduction or the discontinuation of any avoralstat expenses, which is a reason. But the predominant reason is that we’re really excited about the galidesivir program, not only on the Ebola front, but on the Zika. And so, we had hoped to make further progress on that program. But as I mentioned in my remarks, we’re reliant on the government’s approval and authorization process. And so sometimes that doesn’t go as quickly as we anticipate. That has a dual effect. One is the expenses are not as significant. And because we get reimbursed for those expenses, plus our overhead, that has a negative bearing on our cash balance, which is why our cash range stayed the same but our expense guidance actually went down.

Thanks very much.

Thank you. Our next question comes from the line of Jessica Fye from JPMorgan. Your line is open.

Hey, great. Thanks for taking my questions. Just two on APeX-1. First, with more than half your patients enrolled for Part 1. Can you comment on whether the baseline attack rate you are seeing is consistent with your expectations? I don’t know if you can look at that on a blinded pooled basis. I think in the past you’ve mentioned the minimum attack rate for enrollment was two per month. But given that that’s a minimum, you might expect a baseline, on average, higher than that, say between 1/2 to 1 attacks per week. So curious if you can give any color based on what you’re seeing so far that would maybe skew that in one direction or another. And then the second question, just trying to think about how far into 2017 the APeX-1 update might slip. It seems like you only need to enroll eight more patients, and enrollment is going pretty well at this point. So I’m wondering if you can say that you expect to complete enrollment in that part of the study by year-end. And, if so, can we still expect – or could we expect a top-line, Part 1 update, say, in the first half of the first quarter? Thank you.

I’ll take the first part of the question.

Attack rate.

The bottom line is, it’s blinded. And so I’m extremely confident, for the reasons that I mentioned in response to the previous question that everyone will meet the minimum eligibility criterion. As you pointed out, that’s with truncated. In OPuS-1 and OPuS-2, the average attack rate was 50% more and a 100% more in each case, compared to the minimum attack rate. So I would have an expectation it’s going to be something like 50% to 100% more, on average, than the minimum. But it’s blinded, and I’m not going to look at anything until the Part 1 interim analysis is presented to me in a set of QC statistical tables. In the meantime, there’s obviously continuous safety monitoring on the study. But there’s nothing to say about in process, blinded clinical studies until you’ve got an analysis, really.

And then on your second question in terms of timing, we’ve given you a pretty detailed snapshot of where we are, as of Friday of last week. But we don’t have the number to get to the numbers screening and randomized yet. And for me to predict exactly when those will get scheduled and done, I’m not just going to do so. It’s the first quarter of next year.

Okay, great. Thank you.

You’re welcome.

Thank your. Our next question comes from the line of Serge Belanger from Needham & Company. Your line is open.

Hi good morning. Just a couple more questions on 7353. Can you remind us the number of study sites you have, and whether that numbers – will increase? And then you’ve been pointing to 1Q 2017 for OPuS-1 results. Does that still stand if you need to enroll or expand with an additional I think its 12 patients?

Yes, so in terms of number of sites open, we’re actually continuing to open sites. I think we released two, late last week and so we’re up close to 20 sites at this point in time, and we will continue to add more. And then your second question was, will we report out if we need to go to 36 in a first quarter? And the answer is, yes, that’s the plan.

Okay. And then can you talk a little more about the ongoing clinical pharmacology program? You mentioned the reproductive study and the drug-drug interaction. Any other small studies and will they be conducted in parallel with APeX-1? Or should we see most of them report out results once APeX is has reported?

Sure. So just for clarity, the reproductive toxicology is nonclinical. So there’s nothing to do there in the clinic except follow the guidance of what patient populations you can now administer the drug to, and what type of contraception requirements that involves. So the old pregnancy category A, B, C stuff has all gone away. And the ultimate labeling there will be the drug had no evidence of fetal or maternal effects. And it’s a matter of benefit/risk and an individual decision between the patient and physician as to whether they should take the drug, if they are a woman of reproductive age. So that’s a dump. There’s nothing else to double there. With regard to the clinical pharmacology program, a typical program looks at drug metabolism drug-drug interaction drug transporters, and special populations. And it’s all laid out in the guidance from the regulators, and you basically follow that plot. So we need to complete those types of studies as the program proceeds. That’s quite a few studies. They certainly won’t all be done during APeX-1 that to short of a time frame. So you can anticipate that both types of studies will be done from this year through next year, with the aim of completing all of the work to inform the labeling in the NDA. So, there’s a series of studies.

Yes, and we’re investing in all of that stuff, in parallel, basically, so that we have the fastest path to being able to file the drug and get it approved based on the clinical program. And that includes drug manufacturing. This is one of these things where we’re not waiting for a certain results and then starting to do more work. Unless it’s needed to do the next step, we’re running a lot of stuff in parallel.

Okay. And most of these small studies entail healthy volunteers, 20 to 30 patients each?

Yes. They are mostly in healthy volunteers. The exception is if you need to study drug exposure in people with renal impairment, then you have to have otherwise healthy people who have chronic kidney disease and renal impairment. But you’re correct; most of them are in healthy volunteers.

Okay. All right, thanks for the update.

But mostly small studies.

Thank you. Our next question comes from the line of Liisa Bayko from JMP Securities. Your line is open.

Hi there. Most of my questions have been answered. But can you just clarify, from an earlier question: are you going to be releasing data from Part 1 of the study first, and then make the decision about Part 2? Or will it be one disclosure? Thank you.

Yes, I think the answer is, probably; but I will reserve that until we actually see the data and see where we are with enrolment. I guess a situation where we’d do it all at once is if we did the interim cut, and then we had up to 36 already enrolled while we were doing the analysis. But the key – I think a key element is to go to the 36 you need to see a good treatment effect, right. That’s important. So if it’s a bust, obviously we wouldn’t continue. But if you see a good treatment effect, then the placebo rate is higher than we had planned, or the distribution of effect on attack rate is wider than we expected, then that would make sense to go to 36.

Okay, thank you.

You are welcome.

Thank you. Our next question comes from the line of Christopher James from FBR. Your line is open.

On APeX-1 trial design. Are the powering assumptions the same for Part 2 as for Part 1? Or is that just for Part 1?

Yes, hi Chris. No, they’re different, and it’s a different paradigm really. So, Part 1 is powered along traditional lines. The analysis of Part 2 is in conjunction with Part 1. And what we’d be doing there is fitting a model to the dose response for all of the parameters in the study, include – efficacy parameters. We will also be looking at PK and PD. We will also be looking at safety and tolerability. But for efficacy, you are really fitting a model to the dose response data. And what you are interested in that there is, is there a slope as you increase the dose from 125 to 250 to 350? And is that a – so, you can figure out whether the slope is significantly different from zero, and then what’s the shape of the curve. So it’s a different type of analysis.

All right.

We will obviously compare and make an evaluation of the three different doses. At the end of the day, all of the information from the study, including clinical efficacy outcomes, drug exposure, pharmacodynamic effects on kallikrein inhibition, and safety and tolerability will go into a choice about what dose or doses to take into effect.

Got it. And is there an option to expand Part 2 beyond 14 patients? And I’m assuming patients from Part 1 will be rolling over to Part 2. Is that the right assumption?

No, they’re different patients. So, if you come into the study, you are either in Part 1 or in Part 2, but not both. And the second part of your question was around the option to expand Part 2. That’s not built into the protocol. And at the moment, we don’t see any need to increase the sample size in Part 2. I think that the general regulatory guidance encourages sponsors to take more than one dose into Phase III studies, and it’s highly likely we will go down that track. So we will make that judgment on the basis of the advertised sample size for APeX-1 and the results of APeX-1. If there’s a need to collect additional data on more than one dose, then it may make more sense to do that in a pivotal study.

Got it. And then one final follow-up, are you targeting the same attack rate for Part 2 as for Part 1? Or is that a different paradigm?

[Indiscernible] criteria are the same. Yes.

Got it. Thanks guys.

You are welcome.

Thank you. [Operator Instruction]. I am not seeing any other questioners in the queue at this time, so I would like to thank everyone again for their participation at today’s conference. This now concludes the program and you may all disconnect at this time. Everyone have a great day.