Enanta Pharmaceuticals, Inc. (ENTA) Q2 2020 Earnings Report, Transcript and Summary

Good afternoon, and welcome to Enanta Pharmaceuticals Fiscal Second Quarter Financial Results Conference Call. [Operator Instructions] There will be a question-and-answer session at the end of the prepared remarks. [Operator Instructions] I would now like to turn the call over to Jennifer Viera, Senior Director, Investor Relations. Thank you. Please go ahead.

Thank you, operator, and thanks to everyone for joining us this afternoon. The news release with our fiscal second quarter financial results was issued this afternoon and is available on our website. On the call today is Dr. Jay Luly, President and Chief Executive Officer; Paul Mellett, our Chief Financial Officer; and other members of Enanta's senior management team. Before we begin with our formal remarks, we want to remind you that we will be making forward-looking statements, which may include our plans and expectations with respect to our research and development pipeline and financial projections, all of which involve certain assumptions and risks beyond our control that could cause our actual developments and results to differ materially from these statements. A description of these risks is in our most recent Form 10-Q and other periodic reports filed with the SEC. Enanta does not undertake any obligation to update any forward-looking statements made during this call. I'd now like to turn the call over to Dr. Jay Luly, President and CEO. Jay?

Thank you, Jennifer. Good afternoon, everyone. I'd like to take a moment to acknowledge the extraordinary times we are experiencing during the COVID-19 pandemic. Our thoughts are with those who are directly affected. And we are grateful for the heroic efforts of caregivers, first responders and many others who are making great sacrifices for the common good, as we navigate through the worst weeks of this crisis. The safety and well-being of our employees is paramount and we will continue to prioritize it as we move forward. I want to thank our employees for their unwavering dedication to our mission during these last several weeks. In a period of great upheaval and uncertainty, their commitment has allowed us to maintain continuous business operations and momentum that will enable us to execute on our business plans and milestone goals to the best possible extent given the circumstances. This global healthcare crisis has strengthened our resolve to advance novel therapies for unmet needs. And our core expertise in both virology and respiratory diseases positions Enanta to be part of the solution for COVID-19, and other emerging viral threats. To that end, I'll start by highlighting the newest disease program in our respiratory virus pipeline, namely, COVID-19. As you know, in mid-March, we announced that we initiated a program to discover direct-acting antiviral drug candidates for the treatment of patients infected with COVID-19. Based on our proven track record in virology and our capabilities in respiratory diseases, we believe we can leverage our core competencies to discover a potential treatment for COVID-19. That said, we are leveraging our experience and taking a two-pronged approach for our COVID-19 Discovery efforts. Not only are we testing compounds from our antiviral compound library for potential activity against the virus, we are using our background and expertise in direct-acting antiviral mechanisms to discover new candidates to treat COVID-19. We mobilized our virologists and chemists to begin this discovery program, which involves finding leads and ultimately candidates. Among other mechanisms of interest, an initial focus for us are SARS-CoV-2 protease inhibitors. These are direct-acting antivirals. Not a simple endeavor, but this is what Enanta does and what it does well. We'll continue to update our COVID-19 efforts in the coming quarters. I will now turn to our lead respiratory virus program EDP-938 for respiratory syncytial virus or RSV. To remind everyone, RSV is a severe respiratory infection associated with significant morbidity and mortality in infants, the elderly and immune compromised adults, and a condition for which there is currently no safe and effective therapy. Each year in the United States, approximately 57,000 children below age five, and 177,000 older adults are hospitalized for RSV, and about 14,000 die from this respiratory infection. We have completed the RSV season in the United States and are on track with plans to move our Phase 2b study, known as RSVP into the Southern Hemisphere. Given uncertainty is created by the spread of COVID-19 in that region, we're also keeping our North American sites ready for reactivation in the fall and winter RSV season. We are planning to add substantial number of sites in Europe. If we can complete enrollment for this study in the Northern Hemisphere next winter, we would expect to have data in the third calendar quarter of 2021. As a reminder, RSVP is a randomized double-blind placebo-controlled study of EDP-938 designed to enroll approximately 70 subjects up to the age of 75 years, randomized to receive either 80 milligrams of EDP-938 or placebo for five days. The primary objective of this study is to evaluate the effect of EDP-938 on the progression of RSV infection by assessment of clinical symptoms measured over the course of the 14 days study observation period. Antiviral efficacy will be evaluated as a secondary endpoint. Obviously, COVID-19 pandemic currently has an impact on any respiratory disease study. And RSVP, we are in the process of modifying our protocol to do testing to exclude the presence of COVID-19 in any potentially eligible patient with RSV. We continue to collaborate with Cepheid is it's real-time PCR machines, which can now test for RSV, flu A, flu B and COVID-19. These are the machines that we've used at our North American testing sites. We're in the process of getting additional machines set out from the Southern hemisphere sites. We're also on track to initiate two additional Phase II studies, one in pediatric patients and one in adult transplant patients by the end of this year concurrent with the RSVP study. Fortunately, today, it appears the health effects of COVID-19 in children have not been as severe as on adults. And we anticipate parents will continue to take ill children to the doctor, even if the pandemic continues into the winter RSV season in the Northern Hemisphere. And given their immune suppressed condition, we would hope to transplant patients will be on high alert for respiratory illness and be willing to participate in a clinical study. However, we recognize there are potentially more challenges for the transplant study depending upon how the pandemic moves later in the fall. Regarding the third respiratory virus in our portfolio, we introduced our discovery program for human metapneumovirus, also known as hMPV at the beginning of the year. hMPV is a pathogen that causes upper and lower respiratory tract infections in young children and the elderly as well as in COPD, asthma and immunocompromised patients. In fact, it's the second most common cause of lower airway infection in children less than five years of age behind RSV that accounts for more than 20,000 hospitalizations in this age group each year. hMPV also presents a significant health challenge in the elderly and immunocompromised individuals with more than 100,000 hospitalizations annually. We continue to perform optimization of our current nanomolar hMPV inhibitor leads as we work toward identifying our first clinical candidate for this indication. I'll now move to our portfolio of products, focused on the treatment of liver-related conditions. First, let me update you on our clinical stage hepatitis B program with EDP-514, our novel class II HBV core inhibitor. Last month we announced that we are pausing further recruitment in part two of our Phase 1a/1b study of EDP-514 in nuc-suppressed HBV patients in North America, which initiated earlier in this quarter. Nuc-suppressed refers to patients with chronic HBV infection that is being suppressed with nucleoside reverse transcriptase treatment. The current standard of care. We plan to enroll a total of 24 subjects among three escalating dose cohorts with study drug dosed for 28 days. We're regularly evaluating the circumstances around this study and are hoping to resume enrollment within the next couple of months, depending upon whether enough of our clinical sites are able to open. Given FDA guidance on the conduct of clinical trials during the COVID-19 pandemic, and its emphasis regarding the safety of trial participants and integrity of clinical trial data conducting short term trials in patients with chronic disease during the pandemic is not practicable nor recommended. As such, we'll continue to follow regulatory guidance to determine when it is safe to resume the study. We're also pleased to be on track to initiate our Phase 1b study this quarter in HBV patients who are not on therapy and who have high levels of the virus in their blood, who are also referred to as viremic. We are optimistic about this study moving forward in viremic patients, given that our sites are in Hong Kong and Taiwan, those areas where COVID-19 appears to be under better control than in Western countries, and where there is a large unmet need for HPV treatment. As a reminder, this study will assess the impact of EDP-514 on viral load in patients not on other HBV therapies. We are excited about this study because we expect that will produce our next clinical data readout, which we are targeting for around year-end. I'll now move to EDP-305, our farnesoid X receptor or FXR agonist in development for both PBC and non-alcoholic steatohepatitis or NASH. But first, let me focus on our efforts in primary biliary cholangitis or PBC. Earlier today, we announced data from our Phase 2a INTREPID study. INTREPID was a 12-week, randomized, double-blind, placebo-controlled study evaluating the safety, tolerability, pharmacokinetics and efficacy of EDP-305 in subjects with PBC, with or without an inadequate response to ursodeoxycholic acid. The primary endpoint of the study was to evaluate the proportion of subjects with at least 20% reduction in ALP from pre-treatment value, or normalization of ALP, at week 12. In the intent-to-treat or ITT analysis, treatment with 1 milligrams and 2.5 milligrams of EDP-305 resulted in 45% and 46% ALP responses, respectively, compared to 11% in placebo. These response rates, while numerically higher than placebo were not statistically significant. However, in an analysis of the subjects who completed study treatment with no missing value at week 12. The proportions of ALP responders in the 1 milligram and 2.5 milligram arms showed statistically significant response rates of 50% and 62%, respectively, compared to 11% in placebo. Key secondary objectives were to evaluate the safety and tolerability of EDP-305 as well as changes from baseline in the liver enzymes ALT, AST or GGT. Data from the full ITT population showed statistically significant reductions in absolute amounts of these key biomarkers compared to placebo at 1 milligram and 2.5 milligrams of EDP-305. A statistically significant difference in the percent changes from baseline of these key biomarkers at week-12 was also observed in both EDP-305 arms compared to placebo. In terms of safety, EDP-305 was generally well tolerated in subjects with PBC, with the majority of treatment-emergent adverse events or TEAEs being mild to moderate. The most common TEAEs included pruritus, gastrointestinal-related symptoms, headache and insomnia. These TEAEs are consistent with the safety profile observed across more than 400 subjects exposed to EDP-305 for up to 12 weeks. The incidence of treatment discontinuation due to pruritus in INTREPID was approximately 3% for the 1 milligram EDP-305 treatment group, 18% for the 2.5 milligram treatment group and 0% for the placebo treatment group. While we did not meet the primary endpoint for PBC and the ITT analysis, we plan to use these data to help inform our development of EDP-305 for NASH. Specifically, we are encouraged that the lower dose of 1 milligram achieve better tolerability in terms of pruritus, without significantly reducing the number of ALP responders and while still having statistically significant effects on key biomarkers of target engagement. We see this is helpful information for the intermediate doses of 1.5 milligrams and 2 milligrams that we plan to use in our ARGON-2 study in NASH patients. We believe the dose of 1.5 milligrams or 2 milligrams in NASH could potentially achieve an efficacy and tolerability profile comparable to that of the 1.0 milligram dose in PBC. For more information on the INTREPID study, please see the slide deck that we will post on our website after this call. Rather than conducting further dose selection studies with EDP-305 in PBC, a disease for which there is already an approved second-line FXR agonist therapy, and for which generic fibrates are showing benefit and some studies. We intend to focus our future efforts with EDP-305 on NASH. We see NASH, as a disease where FXR agonists like EDP-305 have the potential to be important components of drug combinations designed to give maximum benefit to patients. At our NASH program, we remain focused on evaluating EDP-305 and ARGON-2, a Phase 2b randomized, double-blind, placebo-controlled 72-week study in approximately 340 subjects with biopsy-proven NASH. While we were ready to begin dosing ARGON-2 on schedule in March, we decided to pause recruitment and dosing in the study due to the ongoing COVID-19 pandemic. We did this having in mind the safety of our clinical trial participants as well as resource constraints to clinical trial sites. As a reminder, the primary endpoint of ARGON-2 will be improvement in fibrosis without worsening of NASH and/or NASH resolution without worsening of fibrosis. We plan to use doses of 1.5 milligrams and 2 milligrams, which we selected to provide strong target engagement and a balanced profile in terms of efficacy and tolerability. ARGON-2 will include a 12-week interim analysis to generate dose information more quickly for potential combinations with other mechanisms in NASH. We're hopeful that we'll be able to resume this trial within the next couple of months, depending upon whether enough of our clinical trial sites for this study are able to open up in the context of the COVID-19 pandemic. Also in our NASH program, we are developing in EDP-297, our follow-on FXR candidate. We're excited about the compelling preclinical data we have previously shared that demonstrate the high potency and tissue-targeting characteristics of EDP-297 compared to other FXR agonists in development. Subject to a determination that it is safe to initiate the healthy volunteer study at the trial site in Europe in the context of the COVID-19, we now plan to initiate a Phase I study of EDP-297 later in the third quarter, which would likely produce a readout in the second quarter of 2021. Beyond our pipeline, I would like to take a moment to comment on MAVYRET, our treatment for hepatitis C developed in collaboration with AbbVie. AbbVie recently announced that it is experiencing lower new patient volumes of hospital-based treatments in several international markets where hospitals are limiting access to non-emergency, non COVID-19 patients. If the COVID-19 pandemic continues for a prolonged period, we expect this to adversely affect AbbVie's MAVYRET sales during that period. However, we also expect that those sales will likely shift to subsequent periods, since there is no expectation that existing infections will decline materially other than by eventual treatment. We also note that AbbVie has now guided that it expects its calendar 2020 HCV sales to be approximately $2.3 billion. Also worth noting that the CDC guidelines issued in April 2020, now recommend that all adults ages 18 to 75 to be tested for hepatitis C virus. In closing, I'd like to point to a few key takeaways. Despite a challenging backdrop of COVID-19, which could have effects we don't currently expect, Enanta remains well positioned to execute on our business plans and advance our growing pipeline of novel therapies for respiratory viruses and the liver diseases. The unusual combination of our strong balance sheet and ongoing royalty revenue allows us to capitalize on the opportunities ahead and to advance our wholly-owned pipeline independent of capital market conditions. We are on-track with several milestones. First, our Phase 1b study of EDP-514 in viremic hepatitis B patients is slated to begin this quarter. Second, we are planning to initiate our first in human study of EDP-297 for NASH next quarter. Regarding our RSV program, our two Phase II studies in pediatric patients and adult transplant patients are still on track to begin in the fourth quarter. Finally, we are advancing our RSVP study in the Southern hemisphere, while also keeping our Northern American sites ready for reactivation for the upcoming fall and winter RSV season. And later this year, we are planning to add a substantial number of sites in Europe. Assuming we can complete the study in the next Northern Hemisphere season. We would expect to have RSVP top line data in the third calendar quarter of 2021. Overall, we are in a very solid position with several opportunities in place. With that, I will now turn the call over to Paul to discuss our financials for the quarter. Paul?

Thank you, Jay. I would like to remind everyone that Enanta reports on a September 30th fiscal year schedule. Today, we are reporting results for our second fiscal quarter ended March 31, 2020. For the quarter, total revenue was $27.6 million and consisted entirely of royalty revenue earned on AbbVie's global HCV product sales. This compares to total revenue of $39.6 million for the same period in 2019. AbbVie have stated that it's lower HCV sales were due to a decline in treated patient volumes and select international markets and increased competition affecting pricing and market share within the US Managed Medicaid segment. Royalty revenue for the quarter was calculated on 50% of MAVIRET sales at a royalty rate of 10% after adjustments for certain contractual discounts and rebates, which historically have been approximately 1.6% of AbbVie's total reported HCV product sales. As a reminder, our royalties are calculated on a calendar year basis. Therefore, royalties for our fiscal second quarter ending March 31 are calculated at the lowest royalty rate tier for our fiscal year. You can review our royalty tier schedule in our 2019 Form 10-K. Moving on to our expenses. For the three months ended March 31, 2020, research and development expenses totaled $32.6 million, compared to $34.2 million for the same period in 2019. The decrease was primarily due to a decrease in clinical trial expense due to the timing of costs in the prior year for Phase II studies in NASH and PBC. General and administrative expense for the quarter was $6.9 million compared to $6.8 million for the comparable quarter in 2019. Enanta recorded an income tax benefit of $3.9 million for the three months ended March 31, 2020 compared to an income tax benefit of $3.2 million for the same period in 2019. In the current quarter, we recorded an income tax benefit driven by our pre-tax loss and increased research and development tax credits. In the prior year, Enanta recorded an income tax benefit despite reporting a pretax income due to tax deductions from employee stock award-related activity during the quarter. Net loss for the three months ended March 31, 2020 was $6 million, or a loss of $0.30 per diluted common share, compared to net income of $4.1 million, or $0.20 per diluted common share for the corresponding period in 2019. Enanta ended the quarter with approximately $435 million in cash and marketable securities, an increase of approximately $35 million from our 2019 fiscal year-end balance of $400 million. We expect that these cash resources as well as our continuing royalty revenue will be sufficient to meet our anticipated cash requirements for the foreseeable future. Further financial details are available in our press release and will be available in our quarterly report on Form 10-Q when filed. I'd now like to turn the call back to the operator and open up the lines for questions. Operator?

[Operator Instructions] Your first question is from the line of Yasmeen Rahimi with Roth Capital Partners.

Hi, team. Thank you for all the updates. Two questions for you. The first one is, can you kindly shed some light on why the INTREPID study may have missed on its primary endpoint? Is there any reason that maybe you could have recruited more severe PBC patients that could contribute or we also noticed that the placebo response was higher than we had hoped for. Any color in that regards could be helpful for us. And then the second question is, can you give us an update on where you are in regards to your antiviral development against SARS-CoV-2? How much progress has been made just since the announcement -- announcement was made a few weeks ago? And thank you so much for taking our question.

Thanks, Yas. This is Jay. Why don't I take the COVID question, and I'll ask Nathalie to talk about the INTREPID question. So on the COVID side of things, as you know, we announced our program in the March timeframe after kind of watching the coronavirus start to pick-up and it became pretty clear that it was very different than other coronaviruses, which we hadn't paid that much attention to SARS1 sort of burned out on its own and MERS really substantially went away. It still pops up now and then, but only in regions and in people who have close proximity to camel. So it isn't really a sort of a global threat. But as we all know now, in Spain [Phonetic] COVID seems to be behaving very differently. So we mobilized the team just several weeks ago and have been taking as -- as some have a multipronged approach, our first approach is just getting key things from our library up and ready for testing. As you know, we've worked on lots of different viruses over the years. Within each virus, we worked on lots of different mechanisms. Against each virus and within each mechanism, we often have multiple different structural classes of molecules and so forth. And so we've got a pretty robust library for selection molecules for testing in many different tumor types. So, we've mobilized that external effort. And I would say it's certainly still -- it's still going on. There is a backlog of testing at a lot of these facilities who can handle the BL-3 conditions required for SARS-CoV-2, but we're going through that. So that's a little bit more of a passive activity we hope we might find an interesting chemical launching point if we do it, it saves us that much time. But also not leaving anything to chance we're taking on sort of a direct targeted approach, just like we do with all of our viruses where we unpack the virus figure out where key vulnerabilities might be. And then we learn about to identify certain targets and then optimize highly -- ideally highly potent, safe, convenient to use in this case oral drugs for treatment. So that is more classical, if you will, drug discovery initiative has started -- it started on multiple different targets. Among them, we like protease, that's probably not a surprise based on our legacy and hepatitis C and chemistry and biology has ensued. So, it's been just a short number of weeks and under sort of difficult constraints of the COVID backdrop. But the teams are again highly mobilized on effort. [Phonetic] So we don't have any breaking results to report this quarter, but we'll be giving updates as the year progresses. Nathalie, do you want to comment on the INTREPID?

Sure. Thank you for your question, Yasmeen. So, maybe a few consideration I can point you out. The choice of the endpoint, as you can notice, we use the proportion of patients with more than 20% reduction, which for proof-of-concept study of 12 weeks was setting up primary endpoint as a high bar. So I think it's important just to notice that. If we look at the change over time for ALP, we had a nice reduction over time that was statistically significant. So I believe that there is a few consideration that I can comment on missing the endpoint here. There is probably a lack of power of the study, we decided while back to [indiscernible] the recruitment, because we figure that that point that we had sufficient data that could help us to meet the endpoint with the number of 68 subject. You are right to absolutely point out the fact that we have a higher placebo effect than other studies. And I think the other consideration in a small sample size was the fact that we have a little bit higher rate of discontinuation that we anticipated because we calculated our sample size and power. That could have also contributed to missing the endpoint. From a numerical standpoint, we have a nice difference even from the placebo. And I think given the small sample size and the randomization ratio that we had for 3 to 1, one subject can make a huge difference as far as expressing significant P value. So this is what I can share today. We obviously we'll be looking further to the entire data set, and I hope to bring more color to the result.

Thank you, Nathalie, and thank you, Jay, for the color.

You're welcome.

Your next question is from the line of Brian Skorney with Baird.

Hi, how is it going? Thanks for -- this is Luke [ph] on for Brian. Thanks for taking the call. We were wondering, looking at the COVID clinical planned on the road have other programs and there multi-patients severity level with prophylactic, mild to moderate and severe patients. How does that frames your outlook on entering clinical development in the future? Thanks.

Yes, I think like any -- any new indication, this is certainly a new indication for people to confront. It's going to be -- it's going to evolve over time. So, certainly, in early days of crisis mode, people are getting treated at late stages of infection, perhaps too late. By then, COVID has progressed from an upper airway disease into a lower airway disease, we get a lot of inflammation going on cytokine storms and other things in complications, and it's certainly not ideal. And to look at antiviral in late stage disease is asking an awful lot of any regions [Phonetic] including all the ones that have been tested to-date. We can see why people are doing it, that makes good sense. You don't have anything else when you're in the crisis mode. So while people are waiting for other kinds of more optimized products to come along, waiting for the possibility of vaccines, that's about all you can do. We're obviously not participating in vaccine discovery or development. And we're actually not looking toward entering into patients when they're further progressed in their disease. I think we're sort of thinking a little bit about like RSV. And if you sort of imagine where the [Indecipherable] may eventually go. It's really headed toward -- ultimately, it will be great to get to a state where patients present perhaps not unlike they do in our RSVP study that if there is symptomatic for a few days, they come in, they walk into a clinic, they can get tested. There is a rapid diagnostic test available. Obviously, we've been doing this for a while now in our RSVP study. And then if it lights-up [Phonetic] COVID, you would ideally treat in one direction; if it lights up RSV, treat in another direction. If it lights up flu, you treat in another direction. And so we're probably a ways off [Phonetic] we and others before COVID can be managed that way. But I think that's a pretty -- an aspiration in terms of where we would like to ultimately really make an impact if we are able to. So, I think the longer and we've been saying this for quite a while in RSV, it's all about getting patients diagnosed early and getting them on drug early. And if you really want to change the course of human respiratory viral infections, that's the most likely the best way to do it. I think that's appreciated probably now with COVID, the challenge to date has been testing and also just managing the crisis at the back end of the disease. But hopefully we'll get to a more stable plateau where the course of the patient management can shift in a better direction.

Okay. Thank you so much.

You're welcome.

[Operator Instructions] Your next question is from the line of Akash Tewari with Wolfe Research.

Hi. First on RSV, both J&J and ReViral are assessing combo approaches using an F-inhibitor as well as an L or an N-inhibitor due to some synergistic effects and to combat any potential resistance to one MoA. How do you think your monotherapy approach would compare to those kind of results in regards to safety or efficacy? And would you ever consider a combo approach in later trials? And then, secondly, we know Enanta's a history of success with protease inhibitors, and we recently saw Pfizer identified a coronavirus C3-L inhibitor with minimal or affinity. What do you think would be some of the theoretical pros and cons to targeting this protease in COVID versus some of the other antiviral MoAs like NUCs.

Sure. So let me take your first question first. So I think, we -- the very beginning of our RSV program, we had sort of a clean slate [Phonetic]. We could have started with an entry inhibitors or NUCs or -- in our case, we went for the nucleoprotein approach and other mechanisms. The mechanism that we actually pushed to the side initially in favor of one that we're working on with EDP-938, that was the fusion approach or the so-called f approach. So people, obviously, got excited with the F protein approach first with synagis, a monoclonal antibody targeted against that. We think that makes a great deal of sense in prophylaxis where the drug in this case of monoclonal antibody can be present before the virus. And it's perfectly set up to be there on time and to block entry. That said, if you've got an ongoing pretty active infection where virus has already entered a lot of cells, you had a good deal of viral infection involvement. The fear is that may be a little bit late for fusion inhibitors have maximum impact, particularly if you're getting patients as they progress in time from the time of infection. So we targeted a non-fusion approach using an N inhibitor and it turns out that many of the reasons that you want to use a combination is to thwart the possibility of resistance. And it turns out that our molecule EDP-938 and this mechanism has a very high barrier to resistance, super high barrier. So -- and we've demonstrated that preclinically and have shown all the virology data along those lines. So, whereas I could see why the fusion inhibitor, which by the way fusion inhibitors in our hand in contrast to molecule like EDP-938 will actually have an incredibly low barrier to resistance. And so from a virologic perspective, it makes a good deal of sense if you have a fusion inhibitor approach to try to add something else to it, because you can see resistance mutations popping up very readily in the lab and very quickly in patients who have been dosed with fusion inhibitor. So I would say a fusion inhibitor more likely to need something like an N but an N may not need a fusion inhibitor. Of course, no we can't rule out ever that is a good of a benefit as we're seeing with N that if we added something else on to it that we might see even greater efficacy than we've already seen. That's a possibility. And to that end, we are working on other approaches to RSV, such that we might find a mechanism that could be even better than an N or one that may marry well with N in terms of optimizing efficacy to even higher levels. So that's our thought on that. In terms of the PI for SARS that has -- that has been identified, well, I've already mentioned, we like direct-acting antivirals as approaches here. There's lots of ways that you could think about going after this. But protease is likely or could well be anyway, an important target vulnerability in the virus. So I suspect we and others will be working on those. Enanta is a pretty good protease inhibitor shop and it just makes a great deal of sense for us to not ignore targets like that. NUCs are not necessarily uninteresting. They have -- they can have liabilities as you know. And so there, it's a question of really fine-tuning the profile such that you have a good safety profile and good pharmacokinetics in addition to having just an antiviral effect because optimization maybe required there. But I would say, any of the direct-acting antiviral targets are of interest that this early stage of our understanding of how the virus is really taking.

Awesome. Thank you.

You're welcome.

There are no further questions. I will turn the call back over to Jennifer.

Thank you, everyone, for joining us today. If you have additional questions, feel free to give us a call in the office. Take care.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.