Viking Therapeutics, Inc. (VKTX) Q2 2019 Earnings Report, Transcript and Summary

Welcome to the Viking Therapeutics 2019 Second Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following management’s prepared remarks, we will hold a Q&A session. [Operator Instructions] As a reminder, this conference call is being recorded today August 1, 2019. I would now like to turn the conference over to Viking’s Manager of Investor Relations, Stephanie Diaz. Please go ahead, Stephanie.

Hello and thank you all for participating in today’s call. Joining me today is Brian Lian, Viking’s President and CEO; and Michael Morneau, Vice President of Finance and Administration. Before we begin, I’d like to caution that comments made during this conference call today, August 1, 2019, will contain forward-looking statements within the meaning of the Securities Act of 1933 concerning the current beliefs of the company, which involve a number of assumptions, risks and uncertainties. Actual results could differ from these statements, and the company undertakes no obligation to revise or update any statements made today. I encourage you to review all of the company’s filings with the SEC concerning these and other matters. I’ll now turn the call over to Brian Lian for his initial comments.

Thanks, Stephanie. And thanks to everyone listening on the webcast or by phone. Today, we will provide an overview of our second quarter financial results as well as an update on recent progress and developments related to our pipeline programs and operations. The second quarter of 2019 was exceptionally active at Viking. While it may have appeared relatively quiet from the outside, I can assure you that this was a time of great progress inside the company. Early in the quarter, we presented a Late-Breaker poster at the EASL conference in Vienna highlighting new data from our Phase 2 trial at VK2809. These results demonstrated that VK2809 when dosed as low as 5 mg per day produced efficacy that was similar to that observed at the higher 10 mg doses reported previously. These new data provides further support for our belief that VK2809 possesses best-in-class characteristics and we are excited to further evaluate this agent for the potential treatment of nonalcoholic steatohepatitis or NASH. We worked diligently during the quarter to prepare for our planned IND filing with the FDA, which will outline our upcoming Phase 2b clinical trial in patients with biopsy confirmed NASH. I will provide additional detail on our second quarter development activities in a few minutes, but first we’d like to review our second quarter financial results. I’ll now turn the call over to Michael Morneau, Viking’s, Vice President of Finance and Administration to discuss our financial results. Mike?

Thanks Brian. In conjunction with my comments, I’d like to recommend that participants refer to Viking’s 10-Q filing with the Securities and Exchange Commission, which we expect to file later today, for additional details. I’ll now go over the financial results for the second quarter and six months ended June 30, 2019. Our research and development expenses for the three months ended June 30, 2019, were $7.3 million compared to $5.3 million for the same period in 2018. The increase was primarily due to increased manufacturing expenses related to our drug candidates, preclinical study efforts, salaries and benefits, use of third-party consultants and stock-based compensation, partially offset by a decrease in clinical study expenses. Our general and administrative expenses for the three months ended June 30, 2019, were $2.2 million compared to $1.7 million for the same period in 2018. The increase was primarily due to increased stock-based compensation expense, salaries and benefits, use of third-party consultants and professional fees. For the three months ended June 30, 2019, Viking report a net loss of $7.7 million or $0.11 per share compared to a net loss of $6.7 million or $0.13 per share in the corresponding period in 2018. The increase in net loss for the three months ended June 30, 2019, was primarily due to the increases in research and development and general and administrative expenses noted previously, partially offset by an increase in interest income. The decrease in net loss per share for the three months ended June 30, 2019, is primarily due to the additional shares outstanding at June 30, 2019, versus those outstanding at June 30, 2018, given the additional shares issued by the company since June 2018 primarily through a public equity offering. Our research and development expenses for the six months ended June 30, 2019, were $11.8 million compared to $8.3 million for the same period in 2018. The increase was primarily due to increased manufacturing expenses related to our drug candidates, preclinical study efforts, salaries and benefits, use of third-party consultants and stock-based compensation expense, partially offset by a decrease in clinical study expenses. Our general and administrative expenses for the six months ended June 30, 2019, were $4.5 million compared to $3.5 million for the same period in 2018. The increase is primarily due to increased stock-based compensation expense, salaries and benefits, use of third-party consultants, insurance expense and professional fees. For the six months ended June 30, 2019, Viking reported a net loss of $12.6 million or $0.18 per share compared to a net loss of $10.2 million or $0.21 per share in the corresponding period in 2018. The increase in net loss for the six months ended June 30, 2019, was primarily due to the increase in research and development expenses and general and administrative expenses noted previously, partially offset by an increase in other income related to the decrease in the fair value of the debt conversion future liability as well as an increase in interest income. A decrease in net loss per share for the six months ended June 30, 2019, is primarily driven by the additional shares outstanding at June 30, 2019, versus those outstanding at June 30, 2018, given the additional shares issued by the company since June 30, 2018, primarily through public equity offerings. Turning to the balance sheet, at June 30, 2019, we had cash, cash equivalents and investments totaling $292.6 million. As of July 30, 2019, Viking had 72,210,630 shares of common stock outstanding. This concludes my financial review and I’ll now turn the call back over to Brian.

Thanks Mike. During the second quarter, we continued working diligently to prepare for our upcoming Phase 2b study of VK2809 in nonalcoholic steatohepatitis. As a reminder, VK2809 is an orally available small molecule agonist of the thyroid hormone receptor that possesses selectivity for liver tissue as well as the beta receptor subtype, suggesting promising therapeutic potential in a range of lipid disorders including NASH. In September of last year, we announced positive results from a Phase 2 trial of VK2809 in patients with hypercholesterolemia and fatty liver disease. The trial achieved both its primary and secondary end points demonstrating potent reductions in liver fat content and improvements in plasma lipid measures. These results were presented last November during the oral late-breaker session at the annual meeting of the American Association for the Study of Liver Diseases or AASLD. Additionally, updated results were presented this past April in a late-breaking poster at the annual meeting of the European Association for the Study of the Liver or EASL. The Phase 2 trial randomized patients to receive VK2809 doses of 5 mg daily, 10 mg daily, 10 mg every other day for placebo for 12 weeks. The trial’s primary endpoint evaluated the effect of VK2809 on LDL cholesterol after 12 weeks of dosing compared to placebo. The key secondary endpoint evaluated change in liver fat as assessed by MRI proton density fat fraction, or MRI-PDFF. As we reported at both the AASLD and EASL conferences, with respect to the trial’s primary endpoint, VK2809-treated patients achieved statistically significant reductions in LDL compared with placebo-treated patients. In addition, VK2809-treated patients experienced statistically significant improvements in other lipids, including triglycerides and the atherogenic proteins apolipoprotein B and lipoprotein (a). With respect to the key secondary endpoint, VK2809-treated patients experienced significant reductions in liver fat as assessed by MRI-PDFF. The magnitude of this response remains unmatched among oral agents in development today. Specifically, patients receiving VK2809 dosed at 5 mg daily for 12 weeks experienced a median relative reduction in liver fat content of approximately 54% from baseline. Patients receiving VK2809 doses of 10 mg every other day experienced a median relative reduction in liver fat content of approximately 57% from baseline. And patients receiving VK2809 doses of 10 mg daily experienced a median relative liver fat reduction of approximately 60% from baseline. Across all VK2809 cohorts, the median relative reduction in liver fat was approximately 57%. By comparison, patients receiving placebo experienced a median relative reduction in liver fat of approximately 9%. The trial also included a responder analysis, which was intended to assess whether the observed reduction in liver fat may predict broader clinical benefit. Patients were characterized as responders if they experienced a greater than or equal to 30% reduction in liver fat content. This threshold is of interest as multiple studies have demonstrated that liver fat reduction of 30% or more correlates with increased odds of improved overall histology. In this study, all patients treated with VK2809 dosed at 5 mg daily experienced at least a 30% reduction in liver fat content. Approximately 77% of patients receiving VK2809 dosed at 10 mg every other day demonstrated at least a 30% reduction in liver fat content. And among patients treated with VK2809 doses of 10 mg per day, approximately 91% experienced at least a 30% reduction in liver fat. The responder rate across all VK2809 cohorts in this study was approximately 88%. By comparison, approximately 17% of patients receiving placebo demonstrated a response. VK2809 also demonstrated an encouraging safety and tolerability profile in this study. No serious adverse events were reported among patients receiving VK2809 or placebo, and the overall numbers of adverse events were relatively evenly distributed across treatment arms. Given the promising potency and safety demonstrated in this study, we believe VK2809 is positioned as one of the most promising compounds in development today for the potential treatment of NASH. VK2809 unique potential to improve liver health while also providing global cardiovascular benefits through reductions of systemic lipids is a key differentiating factor when compared to many other agents currently in development for the setting. As we have previously discussed, later this year, we plan to initiate a Phase 2b study of VK2809 in patients with biopsy-confirmed NASH. To that end, we recently submitted a pre-IND briefing package to the FDA in anticipation of filing an IND to initiate the study. As a reminder, our existing IND under which our 12-week Phase 2 study was conducted. It’s filed with the FDA division of metabolism and endocrinology products, which is where many lipid targeting agents are reviewed. Our planned IND will be filed with the FDA’s Division of Gastroenterology and Inborn Errors Products, the division which NASH drugs are typically reviewed. While the details of our planned Phase 2b study will be informed by our FDA interactions, we currently anticipate that the trial will target patients with F2 and F3 fibrosis as well as the limited number with F1 fibrosis. We expect to evaluate more than one dose of VK2809 for up to 12 months. In preparation for the study, we’ve been hard at work putting the resources in place to allow us to begin enrolling patients as soon as possible after we are clear to proceed. We look forward to providing further information about the study as we move closer to initiation. I’ll now provide an update on our VK0214 program. VK0214 is being evaluated as a potential treatment for X-linked adrenoleukodystrophy, or X-ALD. X-ALD is a devastating disease caused by a defect in the peroxisomal transporter called ABCD1. Defects in this transporter can result in an accumulation of very long chain fatty acids in plasma and tissue. These elevations are believed to contribute to the severe cerebral and motor neuron toxicities that are characteristic of the disease. The thyroid beta receptor is an important potential target for therapeutic intervention in X-ALD, as it is a known regulator, a very long chain fatty acid metabolism. Like VK2809, VK0214 is an orally available small molecule thyroid receptor agonist that possesses selectivity for the beta receptor subtype. To date, results from in vitro and in vivo studies of VK0214 have been encouraging. These data has demonstrated the administration of VK0214 resulting in a significant reduction of very long chain fatty acids in both plasma and tissue potentially leading to a therapeutic benefit. We are currently conducting the IND-enabling work for this program and plan to initiate a proof-of-concept study in humans early next year. We are excited to be advancing this program into the clinic and believe that VK0214 may represent the first potential pharmacologic agent for this debilitating disease. Moving to corporate matters, we continue to maintain a strong balance sheet. As Mike indicated, we completed the second quarter with over $290 million in cash and equivalents. Our net burn in the quarter was approximately $6 million, which is consistent with our historical burn of $1.5 million to $2 million per month. While we expect expenses to increase with the initiation of new clinical studies, we believe our current cash balance is sufficient to allow completion of multiple clinical inflection points including our planned Phase 2b study of VK2809 and biopsy confirmed NASH, as well as proof-of-concept studies with VK0214 in X-ALD. Despite this runway, we remained keenly focused on managing our financial resources and controlling our development spent. For this end, concurrent with the filing of our quarterly form 10-Q this evening, we will also be filing an at-the-market or ATM perspectives with the SEC. To be clear, we do not anticipate a need for additional capital in the near term nor do we plan to utilize the facility at this point. Rather, we are filing the documents as a matter of good housekeeping in line with many other companies at our stage of development. Lastly, I’d like to take this opportunity to welcome the newest member of Viking’s Board of Directors. We recently announced the appointment of Dr. Kathy Rouan to our Board. Dr. Rouan has nearly 30 years of pharmaceutical industry experience with drug discovery and development expertise across a range of therapeutic areas including gastroenterology, cardiovascular disease, immunology, and oncology. We are pleased to welcome Dr. Rouan to the team. In conclusion, the second quarter was highlighted by continued progress toward our planned clinical studies with VK2809 and VK0214. The new Phase 2 data presented at EASL validated the potency and safety of VK2809, even at the lowest dose to 5 mg per day. These results provide further evidence of VK2809’s unique potential to improve liver health while providing broad cardiovascular benefits, distinguishing it from other compounds, starting NASH and NAFLD in general. Based on these findings, our team worked diligently during the second quarter to prepare for our planned IND filing for the continued clinical development of VK2809. We remain on track to file an IND and initiate a Phase 2b study of VK2809 and biopsy confirmed NASH later this year. In addition to our progress with VK2809, we continued to advance our pre-IND work for VK0214 and expect to initiate a proof-of-concept study for the treatment of X-ALD early next year. Finally, to support these endeavors, we continue to carefully manage spending and have maintained a strong balance sheet that we believe we’ll see the company through key milestones including our planned clinical studies. This concludes our prepared comments for today. Thanks again for joining us and I’d now like to open the call for questions. Operator?

We will now begin the question-and-answer session. [Operator Instructions] The first question is from Joon Lee of SunTrust. Please go ahead.

Hi. Thanks for the questions and congrats on all the progress. To the extent that you’re able, can you share any feedback from – any discussions you may have had with the FDA regarding your pre-IND submission? And regarding your upcoming Phase 2b NASH study in the second half of 2019, are there any trial differences you hope to incorporate so you can differentiate VK2809 versus the competitors? Any secondary endpoints of particular interests that we should be on the lookout for? Thank you.

Hey, Joon. Thanks for the question. So, no dialogue with the FDA really with respect to the package that was submitted. We do expect that in relatively near term, but there isn’t a lot of back and forth after the submission. You have a date that you’ll receive the response at. And regarding the design of the Phase 2 study, I think it’s going to be a design similar to other Phase 2b studies that are out there. We don’t have all of the parameters, we may change things based on FDA feedback, but right now it’s going to look like other Phase 2b studies that have been completed, then it’s going to conform to the guidance that was published back in December.

That was great. Thank you.

Well, thanks Joon.

The next question is from Steve Seedhouse of Raymond James. Please go ahead.

Good afternoon. Thank you. Brian. Just on the nature of the interaction with the FDA here, my understanding is when you request a pre-IND meeting, the sponsor can request a meeting by phone, face to face or written response only. So my question is, what type of meeting did Viking request, and if Viking did request written response only up front, maybe talk about whether that’s because you didn’t see anything controversial in the data package or just strategically why that would be the direction you decided to go?

Well, yes, it wasn’t our decision. We requested a pre-IND meeting and we received a response that it would be a written response only. We didn’t go back and debate or request anything other than that we were told when the day would be and we filled it was going to be a written response.

Okay. Thank you. And I assume the final clinical study reports for Phase 2a and preclinical data from the six-month animal safety studies for VK2809 were submitted in the pre-IND package. So one question is, are the 12-month nonhuman primate studies also completed? And second part of that is do you have any general comments on the results of those studies that you'd be willing to share?

No, we've always said we're not going to go through the data from the completed GLP tox studies and that's pretty consistent across the industry. What was submitted in the pre-IND briefing package, we are not going to itemize what was submitted there. You typically submit summaries of the completed studies, not the several thousand page clinical study reports. In a pre-IND package, the actual study reports go into IND. But you summarize the key findings in the briefing package with the appendices that referred to key passages from the study reports.

Okay. The last question any abstracts submitted to AASLD this year? Thanks.

Sure. Thanks. Not yet. We may submit one a little bit later. I know we're past the original deadline, but the late-breaker deadline has not come up yet. So we may submit one for a late-breaker.

Just to follow-up, would there be additional data from the Phase 2a study or something else?

Yes, it would be from the Phase 2a study, yes.

All right. Thank you.

Yes, thanks Steve.

The next question is from Jay Olson of Oppenheimer. Please go ahead.

Hi, thanks for taking the questions. I was wondering if you could please comment on the doses that you're considering studying in Phase 2b. And then also how fast do you think you can enroll that study? Will you use the same study sites that you used for Phase 2a?

Hey, Jay, thanks for the question. So we haven't, given the details on the Phase 2d study, what we said is that there will be some representation from the Phase 2a studies. There will be overlap in some of the doses from the Phase 2a study, as well as lower doses. And as far as the timing as soon as possible, but, I think, if you look at recent – some of the recent Phase 2b studies that have been completed, that's kind of the timing that we would like to parallel. And so if you think of four to six quarters from initiation till the initial data readout that seems like a fairly reasonable estimate, we won't know until we get the study underway. And as far as the clinical sites, we'll probably use a couple from the Phase 2a study, but it's going to be more sites. So we won't use – there won't be a lot of overlap there, just a couple.

Will it be a global study?

No, we will be focused on the U.S.

Great. Thanks for taking the questions.

Thanks Jay.

The next question is from Joe Pantginis of H.C. Wainwright. Please go ahead.

Hey guys. Good afternoon. Brian you probably can't say too much to my questions, but I wanted to sort of go off of your prepared comments when you said how busy you guys have been behind the scenes. So with that said I wanted to focus on business development. Maybe wanted to see if you had any comment about how things might be going for VK5211. And do you have any potential early interest, or phone calls or what have you for VK2809?

Yes, great question Joe. So yes we had a good bio meeting that was back in June in Philadelphia, a very busy schedule and that was probably split pretty close to fifty-fifty on VK5211 and VK2809. And we've always said with VK5211, the registration path seems challenging there, but there are still some, I think, interested parties with that program. Hard to guide to timing there, but, I think, it's safe to say it's not stuffed back in a shelf and forgotten about here at the company. With VK2809, yes everybody is aware of the compound and has watched the development, and continues to watch the development. And I probably won't give any more color than that on the dialogue that we've had there.

No, of course, I won't ask you when the term sheet is coming, but that's very helpful. Thanks.

Thanks Joe.

The next question is from David Bautz of Zacks Small Cap Research. Please go ahead.

Hey, good afternoon. Brian I'm curious if you would have any reason to believe that there'd be restrictions on enrollment in the Phase 2b trial? And also do you have any expectation that you're going to be required to conduct a drug-drug interaction study with statin similar to what other NASH companies had to do?

So, I think that's kind of a standard course of developments and we would certainly expect to complete a drug-drug interaction studies through the course of VK2809’s development. And I said to an earlier question, we're not going to itemize what was included in the briefing packet or what will be included in the IMD. As far as the enrollment restrictions, we don't believe that we should be held to enrollment restrictions. But it's hard for me to prognosticate what the FDA will come back with, but there is no evidence that we're aware of that would suggest that those restrictions should be applied. The same restriction from the Phase 2a should be applied to the Phase 2b. But again, very difficult to guess what the FDA will or will not allow.

Okay. And what is left to do for VK0214 before an IND can be filed?

Well we've done a lot of formulation work with that compound, formulation is somewhat challenging. And we will be working on the GLP tox studies in the second half of the year.

Great. Thanks for taking the questions.

Thanks David.

The next question is Andy Hsieh of William Blair. Please go ahead.

Hi, thanks for taking my questions and congratulations on all the progress. Just from kind of timing or disclosure perspective, are you planning on kind of communicating with the Street in terms of when the written response from the FDA has occurred? And following that would you let us know when you finalize the study design before initiating the study? Just kind of, I want to get a sense of the kind of the news flow in the second half.

Yes, I think, the biggest news item will be the initiation of the study with the details on study design. I think that will answer questions that are out there. As far as when we receive a written response, that's not going to help anybody decide anything, I mean we certainly wouldn't disclose any details that we received from the FDA. And the pre-IND information is not the IND itself. And so we won't know really what the FDA thinks until we file the IMD with the exact protocol with our recommended patient population and we get a response. So once we get that response and begin enrolling, it's when we will disclose most of those details

Okay. And it's my understanding of that the IND immediately becomes active after 30 days. Is that correct? So basically during that period of time no news is good news.

Yes, what that normally means you hear something on day-29. But yes, no news is good news generally, yes. You don't hear anything, you're going to proceed.

Okay. And lastly, in terms of enrollment, obviously there's a lot of, Phase 2, Phase 3 trials ongoing in NASH. Just curious if there's any sort of strategy that you can employ to speed up or to incentivize patients to enroll in your study relative to others?

Yes, it's a great question. There are a lot of studies out there both internally and at our CRO this has been a real high focus area. We think that our understanding from hearing from some of the sites that we'll be participating there's high enthusiasm for this program. And we know that sites have been very responsive when queries are sent to them according to CRO more than they are typically seeing. And we will be employing, I think, a lot of the learnings that have been collected over the years from the completed studies to hopefully minimize screen failures and select the right patients to enter the screening process. And all of that, we hope will give us a reasonably productive enrollment timeline.

Okay, cool. Thanks for answering all my questions.

Okay. Thanks Andy.

The next question is from Yale Jen of Laidlaw. Please go ahead.

Good afternoon and congrats on the progress. And thanks for taking the questions. Just want to be clear that for the IND filing that you will not anticipate my any sort of face to face meetings, but just a more, sort of regular exchange of mails or phone calls to finalize the process. Is that correct?

That's correct, Yale, yes.

And my second question here is that the last presentation you guys have shown rather robust outcomes from a very low dose, if I make a part of that. So the question is that, are you guys still contemplating on maybe having some sort of a loading and maintenance, those type of scheme being placed into the Phase 2 study, or you think those are other things you should do in a much later case – later time after the Phase 2b?

Yes, it's a great question Yale. I think we had originally spoken about that, or talked to internally at least about that loading dose followed by a low maintenance dose. I think the trial is complex and challenging enough without implementing that sort of a regimen as an exploratory arm. You could still do it in a separate study. And we'll see how this study goes. But I think that would be something that we could pursue in a separate study subsequent to this study or at another time, but it won't be a part of this study.

Okay, great and thanks. And congrats for the progress.

Thanks a lot Yale.

[Operator Instructions] The next question is from Mayank Mamtani of B.Riley FBR. Please go ahead.

Thanks for taking my question and congrats on the progress. Just two for Brian and one from Mike. Brian, could you maybe talk a little bit about the structural differences for VK2809 and VK0214? I understand obviously this target and the pro-drug format, but I think you mentioned formulation was different. And maybe if there's anything you could comment on the effect on CYP3A and/or vinyl ketone derivative as a byproduct for each of them. That would be great. And then I have a follow-up.

Yes, yes, VK0214 is a different structure. And the way we normally write these is, the polar part is on the right hand side and the aromatic rings kind of extend to the left. The structure of VK0214 has never been disclosed, but the substitution pattern on those rings is different between the two molecules. So it does have a little bit different profile in vitro and in vivo. It's more selective for the beta receptor. And the PK parameters are a little bit different. We always run them side by side when we do the animal studies in NASH. And it's certainly a very effective NASH as well. When you look at the subcomponents it just looks a little bit different. And so we think that right now, I mean just pursuing X-ALD is the best course there.

That's really helpful insight. Just for follow-up on that then, as you do the work together on either/or and both together, has there been any observation in the last six to nine months that kind of made your plans to be any different than where you started with?

No. No changes based on data in the last six to nine months.

Excellent. And then last thing the placebo responds on the 5 mg, was there anything different? I know you reported on an absolute basis for all doses noses. Was there anything that you saw that placebo response was different or similar to the earlier?

No. No, I think that arm added to that cohort, dataset added two more placebo patients. I don't have the numbers right in front of me. And those placebo patients did not have any meaningful impact on the overall placebo data.

No. Okay, great. And Mike, just one last question. There were four buckets you said in the R&D spend. I mean, would you be able to give any color whether the increase from previous six months or three months was driven by any one or two of the buckets there, like manufacturing expense or, pre-IND spend or anything else?

Yes, it's a combination of the manufacturing spend as well as some of the efforts on their preclinical side in terms of getting some of the preclinical efforts pulled together.

Okay, great. Thanks for digging my questions

Thanks, Mayank.

The next question is from Scott Henry of Roth Capital. Please go ahead.

Thank you and good afternoon. Just a couple of questions. First not on VK2809, could you talk about what is the typical turnaround from a pre-IND submission to when you would get written feedback?

It's 30 days.

30 days then it's 30 days from that point the IND to the final, or is that an overlapping 30?

No, no, you submit a package, you get information from them and then you at some later date file an IND or a new 30-day clock starts.

And that's what my understanding was. So it's 30 days as well for the pre IND submission.

That's right.

Okay. Thank you for that color. And the second question was if I recall the original target for the IND was mid-summer, it would seem like we're into the fall given today's comments was there anything that pushed that beyond mid-summer or is it still mid-summer? Just any color you could give would be great.

Yes, so it is still around the middle of the summer. It's, I'm not going to give a lot of additional color there.

Okay. Fair enough. Which would certainly imply that you expect all of this to happen very soon. Separate question, tied in a little bit to the R&D, it did jump up significantly in 2Q. How should we think about Q2 as a reflection of the rest of the year in terms of sequential growth? Or is it this – should it dip before the trial until the trial starts, or should we think about it maintaining these levels?

On the R&D side it's going to tick up here in the second half of the year as we ramp up the spend for the Phase 2b study.

Okay, great. That should do it for me. Thank you for taking the questions.

Yes, thanks Scott. And just to clarify, middle of the summer, the calendar summer is what we're referring to there. So, middle of the calendar summer is when we had previously indicated we expected to hear something from the FDA. But we never have given a specific date there. Just to clarify that though,

Just as a follow-up then, what exactly is the calendar summer?

Well, the calendar is June – third week of June to the third week of September.

Okay, great. That, that's helpful. Thank you.

Okay.

Okay, the next question comes from Jason McCarthy with Maxim Group. Please go ahead.

Hi everyone. It's a day on the line for Jason. Just had a couple of quick questions here. So as I understand you guys are currently focusing on working with the FDA and hope down the road eventually getting approval. But I was just wondering once that's taken care of and achieved do you have any intention of perhaps setting up meetings with corresponding regulatory authorities in Europe? Is this something that you guys are kind of thinking about?

Not right now. I mean, the focus near term is moving into the Phase 2b study. And we will likely queue up some sites in Europe in the event that enrollment is slower than planned in the U.S. but there won't be any major European regulatory interactions.

Okay, great. Thanks. And then with respect to the VK2809, is this primarily do you guys plan on primarily using this as a front line therapy, or do you have any intention of evaluating it in the context of using it in conjunction with other current standard-of-care therapies?

We think the data and the mechanism suggest that it could be used in either setting. I think right now the expectation is that combination therapy will likely provide the greatest benefit. But we think early stage patients could probably benefit from the mechanism and certainly in combination we think it could enhance and be complimentary to some of the existing mechanisms and some of the other mechanisms.

Great. That's really helpful. Thanks a lot. I appreciate it.

Okay. Thank you.

This concludes our question-and-answer session. I would like to turn the conference back over to Stephanie Diaz for closing remarks.

Thank you. Thanks again for your participation and continued support of Viking Therapeutics. We look forward to updating you again in the coming months. You can all disconnect. Thank you and have a great afternoon.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.