Ladies and gentlemen, welcome to the Arrow Pharmaceuticals Conference Call. Throughout today’s recorded presentation, all participants will be in a listen-only mode. After the presentation, there will be an opportunity to ask questions. I will now hand the conference over to Vince Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.

Thank you and good afternoon, everyone. Thank you for joining us today to discuss Arrowhead's results for its fiscal 2025, second quarter ended March 31, 2025. With us today from management are President and CEO Dr. Chris Anzalone, who will provide an overview, Dr. Bruce Given, Interim Chief Medical Scientist, who will provide an update on our cardiometabolic pipeline. Andy Davis, Senior Vice President and Head of Global cardiometabolic franchise, who will provide an update on commercialization activities. Dr. James Hamilton, Chief Medical Officer and Head of R&D, who will discuss our earlier stage development programs and Ken Myszkowski, our outgoing Chief Financial Officer who is retiring this week, who will give a review of the financials. We also welcome Dan Apel, our incoming CFO who is also with us on the call today. Following management's prepared remarks, we will open the call to questions. Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical fact are forward-looking statements and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statements. For further details concerning these risks, please refer to our SEC filings, including our most recent annual report on Form 10-K and our quarterly reports on Form 10-Q. I'd now like to turn the call over to Chris Anzalone, President and CEO of the Company. Chris?

Thanks, Vince. Good afternoon everyone and thank you for joining us today. Before I start, I want to say thank you to Ken and wish him the best in his retirement. Ken has been a valuable member of the Arrowhead team and he retires at a time of great financial strength for the company. The financial organization that Ken built over the years is very capable and provides strong support to our ambitious development and commercialization plans. From all of us at Arrowhead, thank you for all the important contributions over the last 16 years. I am also excited that Dan Appel will join us as our new CFO at a critical time for Arrowhead. We expect to make the transition from development stage to commercial stage with the planned launch of plozasiran this year, pending regulatory review and approval. Dan is an accomplished pharmaceutical executive who can make an immediate and important impact on our business. Let's now talk about our business and the progress we've made toward our short, mid and long-term goals. Arrowhead is at an important point both in terms of capabilities and potential value as we drive our organization toward our first commercial launch which we anticipate this year. Following this, we expect multiple additional independent and partner launches over the next few years. The combination of commercial expansion, our extraordinarily productive discovery engine, the increasingly validated nature of our platforms and RNAi modality, our large pipeline of clinical stage assets, our strong balance sheet and clear access to additional non-dilutive capital together provide us with a level of upside potential and stability that I believe is rare in our industry. This is always attractive, but is even more valuable at a time when biotech markets have been depressed for the past several years and the near-term capital markets are uncertain at best. As the current biotech market weakens, I think we have the tools for both stability and explosive value growth. I view our value proposition in layers. Layer 1 is plozasiran which constitutes our primary near and mid-term value driver and provides a strong base for us. Plozasiran has shown to be a potent triglyceride-lowering agent across multiple clinical studies in hundreds of patients. We believe there are 3 to 4 million people in the U.S. alone who suffer from severe hypertriglyceridemia, or SHTG, as defined by fasting triglyceride levels above 500 milligrams per deciliter. We are preparing to launch into a small subgroup of this population of patients with Familial Chylomicronemia Syndrome, or FCS, and have a PDUFA date of November 18, 2025. We also completed the submission of a Marketing Authorization Application or MAA with the EMA and are working through additional plan submissions in other select geographies. The Phase III data supporting our regulatory submissions were consistent and encouraging. Genetically defined and clinically defined FCS patients responded similarly with reductions in triglycerides of about 80% from baseline. Approximately 75% and 50% of patients had triglycerides go below 880 and 500 milligrams per deciliter, respectively, which are established guidelines in the academic literature as important goals for minimizing pancreatitis risk. Plozasiran was generally well tolerated and showed triglyceride reductions in 100% of patients treated at the primary endpoint of 10 months. Our hope of treating FCS patients is important. This is a historically underserved population and we believe plozasiran could be an important medicine; however, we view this as just the beginning. We are also in the process of initiating studies designed to support a supplemental NDA to treat the broader SHTG population. We think this is an innovative strategy to demonstrate meaningful value for patients, physicians and payers. Our second layer of value may be our initial obesity candidates and initial CNS candidates. ARO-INHBE is currently dosing in obese patients, and we expect ARO-ALK7 to begin dosing in obese patients shortly. Both are designed to intervene in a biological pathway regulating fat storage. Both programs demonstrated substantial reductions in visceral fat versus control while simultaneously preserving lean mass in animal models. Our CNS BBB platform has made great strides in recent years, and we expect to be in the clinic late this year. Our first candidate ARO-MAPT targets the Tau protein for potential treatment of Alzheimer's. We expect to bring ARO SNCA to the clinic, which targets alpha-synuclein for potential treatment of Parkinson's. The sales infrastructure we are building for zodasiran could easily be leveraged for this population so this feels like a straightforward, relatively rapid, low-risk and low-cost expansion of our commercial presence. Our previous studies give us confidence that it could be an effective agent to reverse fibrosis in patients. While we view these as primary near and mid-term value drivers, there are substantial pieces of our business underneath them providing redundancy and additional upside potential. We expect this to continue to drive value as the basis for many additional wholly-owned drugs and through future partnerships. Importantly, we believe we have the capital to support our work. The Sarepta deal was a critical component of this and we closed the global license and collaboration agreement with Sarepta that materially strengthened our balance sheet. We expect this adds up to significant cash payments. The total potential value of this deal exceeds $11 billion. This will be a transformational deal. We are now funded into 2028 and through multiple important milestones that we think can drive substantial value for our shareholders. With this overview, I'd now like to turn the call over to Bruce Given. Bruce?

Thanks, Chris, and good afternoon, everyone. Arrowhead has been working in RNAi Interference for nearly 20 years. During that time, we have made great strides creating a modality that is increasingly scalable, reliable, potent and generally well tolerated. We've also made great strides bringing RNAi to where it is needed. In addition to delivering to hepatocytes, we are now able to address lung, CNS, muscle, adipose and cardiomyocytes. We have always been a great R&D platform company and we are now taking a next step forward as we seek our first marketing approval for plozasiran for patients with familial chylomicronemia syndrome or FCS. Most of you will be aware of the results of our Phase III Palisade study, which was published in the New England Journal of Medicine last year and showed statistically significant responses on all primary and alpha-controlled secondary endpoints. We've also had routine pre-filing meetings with EMA, which culminated in the submission of a Marketing Authorization Application or MAA on February 28, 2025, which has been confirmed to be valid for review. Our plan is to seek approval in the U.K. following approval in either the U.S. or Europe by leveraging the international recognition procedure. We are hopeful that these filings will lead to Arrowhead’s first commercial launch, possibly beginning as early as late this year.

Thank you, Bruce. With the PDUFA date for plozasiran set for November 18, just six months away, I’m pleased to share that our commercialization efforts are advancing rapidly and with strong momentum. As discussed by Bruce, the medical affairs team is in the field helping educate the physician universe and facilitating publication of the results of Arrowhead’s clinical trial. We are also making strong progress in building our commercial sales team. A national sales leader and a full complement of regional sales leaders are now on board and focused on hiring and onboarding top tier talent with deep rare disease and therapeutic area expertise. Interest has been very encouraging with thousands of resumes in the queue and we are on track to fully hire and train our sales force by late summer, ensuring ample time for target validation and disease state education in advance of launch. A market access team is executing effectively on our pre-approval information exchange, or PIE, strategy directed toward healthcare decision-makers to help them plan for our potential approval.

Thank you, Andy. First, I’d like to provide a status update for our two early-stage obesity programs, ARO-INHBE and ARO-ALK7. ARO-INHBE is designed to reduce expression of Activin E, which is a ligand for adipose ALK7, while ARO-ALK7 is designed to reduce expression of the ALK7 receptor itself, both of which are involved in regulating adipose storage of fats. These programs both have the potential to reduce visceral fat mass while simultaneously preserving lean mass, which we have demonstrated in preclinical models and are now evaluating in clinical studies.

Thank you, James, and good afternoon everyone. As we reported today, our net income for the quarter ended March 31, 2025 was $370.4 million or $2.75 per share based on 134.5 million fully diluted weighted average shares outstanding. This compares with a net loss of $125.3 million or $1.02 per share based on 123.3 million fully diluted weighted average shares outstanding for the quarter ended March 31, 2024. Revenue for the quarter ended March 31, 2025, was $542.7 million, with no revenue recorded in the quarter ended March 31, 2024. Revenue in the current period relates to our license and collaboration agreement with Sarepta.

Thanks, Ken. Arrowhead is in a strong and stable position as a business, and we have made meaningful progress towards our long-term goal of developing and ultimately commercializing new innovative medicines for millions of patients. We are on schedule to launch plozasiran this year, pending regulatory approval, with what we think is a best-in-class profile with meaningful differentiation from currently available therapies in FCS. We are also well on our way to fully enrolling this summer our suite of Phase III studies designed to support regulatory submissions for the large SHTG patient population. We are funded into 2028 and potentially through multiple launches of wholly owned and partnered programs in late-stage development. Thank you for joining us today and I would now like to open the call to your questions. Operator?

Thank you. And our first question comes from Maury Raycroft of Jefferies. Your line is open.

Congrats on the progress and thanks for taking my question. And best wishes to Ken, and welcome, Dan. For INHBE and ALK7, you've noted that the goal there is not to compete with GLP-1s, but to be used in combination. What's the latest you're seeing on how you're setting expectations for initial monotherapy and potential combo data? I guess, what do you want to see in the initial update, including changes in weight loss, body composition and relevant biomarkers?

Thank you, Maury. We're not providing guidance on what we expect to see since this is a first-in-human study. The data we've gathered is promising. We observed significant weight loss when used alone and in combination with tirzepatide. This represents a new approach that could fill existing gaps in the current GLP-1 and GIP standards. We're eager to see the results and believe the benefits may extend beyond just weight loss to include the quality of weight loss. We're interested in whether there is a decrease in visceral fat and if lean muscle mass is maintained. We've seen these effects in animal models and hope to replicate them in humans as well. Importantly, these results were not due to caloric restriction but occurred during normal feeding, which would also be beneficial for humans. We'll have our first set of data by the end of this year, and we expect to receive substantial data every quarter over the next year.

Thank you. And our next question comes from Jason Gerberry of Bank of America.

Hey guys, thanks for taking my question. Just ahead of the plozasiran FDA review decision, I'm wondering how you think about the robustness of your pancreatitis data and how that might look or feel a little bit differently in the package insert. I noticed Tringolza just has a mention of the numerical incidence reduction in the clinical section. And I'm wondering if you guys feel like based on Palisade that you might get maybe a more robust front-page reference to the pancreatitis benefit? Anything you can just offer on the potential aspects of label differentiation would be much appreciated. Thanks.

Yes, hi, this is Bruce. We haven't had any labeling negotiations with the FDA at this point, and it's really impossible for me to estimate how they may view things. We obviously like our data quite a bit. We have followed a more conservative route that we think may be important, especially for instance with payers in Europe. But we will see. I can’t give you any guidance for what the labeling is going to look like. Ultimately, it’s going to be up to them. We’ll obviously discuss it with them, but I can’t speak for them at all.

And let me just add here more broadly. The biology here is clear. In these patients, the higher the triglycerides, the higher the risk of pancreatitis. The real thing to focus on is how low can we get triglycerides. In the Phase III study, we saw approximately 75% of patients go below 880 and about 50% below 500. That's a significant achievement for these patients.

Thank you. And our next question comes from Ellie Merle of UBS. Your line is open.

Hey this is Jasmine on for Ellie. Thanks so much for taking the question. So first for plozasiran in SHTG, can you talk about what the latest is that you are expecting for your baseline rate of acute pancreatitis in your population for SHASTA-3 and 4? And what do you think the magnitude of effect that you think that you can show here is? And then just quickly, second on zodasiran, can you clarify your current expectations in terms of potentially expanding beyond HoFH here? Thanks.

Regarding the expansion beyond HoFH with zodasiran, that would be in potentially some sort of high-risk HeFH population. We proposed a narrow approach, but to get into HeFH, they wanted more extensive trials. Right now, we do not anticipate that we would expand Zodasiran beyond HoFH. It's just not feasible for us given the resources.

As for SHASTA-3 and SHASTA-4, we expect that the baseline for acute pancreatitis will be similar to what we observed in the Palisade study. This trial will be designed to demonstrate statistically significant improvements in triglycerides and the number of events. We will collect more data as the trial gets underway.

Thank you. Our next question comes from Patrick Trucchio of H.C. Wainwright & Company. Your line is open.

Thanks, good afternoon and congrats on all the progress. I was curious about your ARO-C3 and ARO-CFB programs and your latest thinking regarding their positioning in complement-mediated diseases and how you are viewing these compounds? Are they core to your portfolio or could there be potential for partnering?

Sure. We are open to discussing partnerships for C3 and Factor B. Those drugs work and lower C3 and factor B respectively. We think there's a number of places they can go. If push comes to shove, we could build out a commercial presence; however, finding the right partnerships would be beneficial. James, do you want to elaborate on some opportunities?

Yes, sure. We think ARO-C3 stacks up well against the other complement-mediated drugs in renal indications. The 41% reduction in proteinuria with ARO-C3 is competitive, particularly with infrequent dosage administration potentially offering advantages in treatment.

Thank you. And our next question comes from Andrea Newkirk of Goldman Sachs. Your line is open.

Good afternoon. Thanks for taking our question. As you think about entering the obesity space, how are you thinking about advancing both ARO-ALK7 as well as ARO-INHIBE through clinical development? What are your interests in advancing them both? Or would you look to make a decision on one versus the other following the initial data sets?

Yes. So our plan is to take both through Phase I and then review the safety and efficacy data before choosing one to move forward. However, we expect to develop additional obesity assets down the line, as we believe there are compelling metabolic and obesity targets that we aim to address.

Thank you. And our next question comes from Luca Issi of RBC. Your line is open.

Oh great, thanks so much for taking my question. Congrats on the progress. Can you just elaborate on how you're thinking about the SHASTA-5 study design? What patients will be enrolled? And how many patients do you need to ensure significance? Also, how are you thinking about commercialization of plozasiran outside the U.S.?

This trial will focus on patients with a history of pancreatitis. We are yet to disclose the exact number of events we are targeting but expect this will be on the lower side compared to other studies. As for commercialization, the U.K. and Canadian markets are a priority for us. We believe we can effectively market plozasiran for FCS patients through centers of excellence.

So as I mentioned earlier, we intend to advance our efforts in major European markets as we move forward with our licensing and partnerships. We are fully equipped and focused on achieving robust visibility in the international markets.

Thank you. Our next question comes from Edward Tenthoff of Piper Sandler. Your line is open.

Great. Thank you very much. Do you anticipate an advisory committee, or what are some steps you are taking in preparation for potential approval and launch?

We have not been advised that there’s an expectation for an advisory committee. The agency could change their opinion at any time, but right now, we don't think one is in our future. We are preparing on multiple fronts for launch, including educational efforts to physician networks.

Education is essential, especially in orphan diseases where awareness is limited. The first drug introduction often creates a pathway for subsequent entrants, and we believe that overlapping promotional efforts can significantly expand market opportunity.

Thank you. Our next question comes from Mike Ulz of Morgan Stanley. Your line is open.

One more on plozasiran and the FCS launch. Could you provide insights on the U.S. patient population and updates on your efforts to identify potential patients?

The prevalence of FCS in the U.S. is variable, ranging from a few hundred to a few thousand patients. Our internal team is actively working to identify these patients using the latest technologies to ensure support for those who may not yet know they have FCS.

Thank you. Our next question comes from Mayank Mamtani of B. Riley Securities. Your line is open.

On ARO-INHBE, any insights from the SAD data? Are your combo studies enrolling at the same time, or are they sequential?

Yes, those combinations are enrolling at the same time. We’re looking forward to sharing data later this year based on initial findings.

We've included the near-term milestones in our revenue guidance, primarily related to the Sarepta agreement. The agreement is significant with various clinical assets involved, and we expect some recognition of this revenue over the next 12 months.

Thank you. Our next question comes from Mani Foroohar of Leerink. Your line is open.

Thanks for taking the question. Following previous discussions, how should we interpret the ongoing Series A capital raising with an industrial partner for the CNS assets? Is there a timeline expectation there?

While we are currently focused on internal developments, we remain open to partnerships if the right opportunities arise. The timeline of any potential industrial collaboration would depend on market dynamics.

Thank you. I'm showing no further questions at this time. I'd like to turn it back to Chris Anzalone for closing remarks.

Thanks, everyone, for joining us today. It is bittersweet to end this call. This is the last time I'm going to have Ken on my left during these calls. And as we mentioned in the prepared remarks, I really appreciate his great work for the last 16 years. I'm excited to have Dan on board today, but thank you all for joining us today.

This concludes today's conference call. Thank you for participating, and you may now disconnect.