Kymera Therapeutics, Inc. Q2 FY2025 Earnings Call

Good day, everyone. My name is Olivia, and I will be your conference operator today. At this time, I would like to welcome you to the Kymera Therapeutics Second Quarter 2025 Results Call. At this time, I would like to turn the call over to Bruce Jacobs, Chief Financial Officer.

Good morning. I'm Bruce Jacobs, and I'm kicking off this in place of Justine Koenigsberg, our Head of IR, who is out today. Joining me this morning are Nello Mainolfi, Founder, President and CEO; and Jared Gollob, our Chief Medical Officer. Following our prepared remarks, we'll open the call to questions from our publishing analysts. If you'd like to ask a question, please use the raise hand icon, which can be found at the bottom of your meeting window. And to help us move efficiently through the Q&A session, we ask that you're ready to unmute your line when called upon. In addition, we ask that you please limit your question to one and a relevant follow-on to ensure we have enough time to address everyone's questions this morning. Before we begin, I'd like to remind you that today's discussion will include forward-looking statements about our future expectations, plans and prospects. These statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected. The description of these risks can be found in our most recent 10-Q filed with the SEC. Any forward-looking statements speak only as of today's date, and we assume no obligation to update any forward-looking statements made on today's call. With that, I'll turn the call over to Nello.

Thanks, Bruce, and thank you for joining us this morning. As I mentioned at the beginning of the year, we set ourselves up for a very productive and exciting 2025, and we're delivering on that promise. The updates we've shared in the first half of the year represent a powerful validation of Kymera's innovative and disciplined approach to drug development within the biopharma industry, while paving the way for our future progress across our high-impact immunology pipeline. We're committed to leveraging the unique capabilities we have developed to unlock disease biology and deliver groundbreaking oral degrader medicines for areas not served well by existing technologies. Today's immunology treatment landscape still leaves millions of patients without adequate options, forcing difficult trade-offs between efficacy, safety, cost and convenience. Millions of patients with life-altering immune-inflammatory diseases don't have access to advanced systemic therapies, mostly injectable biologics. This is true if we look across countries with extremely diverse systems on how they prescribe, reimburse and deliver these highly effective medicines. The issue is really more fundamental than the inefficiencies of the healthcare ecosystems around the world. Simply put, well-tolerated oral drugs that can be as effective as these difficult-to-access injectable biologics have the potential to transform the treatment landscape and, in doing so, impact the lives of millions of patients. This is what we're set to do at Kymera. It's an exciting time for the company, and I want to take a moment to briefly recap some of the key accomplishments of the first half of 2025. Starting with our first-in-class STAT6 program. We completed the first KT-621 trial in healthy volunteers and reported positive results that exceeded even our high expectations, surpassing our target product profile. Importantly, the data further derisks our path forward and highlights the possibility of KT-621's strong appeal profile. As potential first-in-class treatment, we believe KT-621 has the ability to be a broadly accessible oral option for many dermatological and respiratory diseases like atopic dermatitis and asthma. In addition, for Japanese regulatory purposes, we recently completed a second small healthy volunteer study in Japanese subjects with results that were consistent with the U.S. study. You can expect that we'll present these findings at a future medical meeting. We also wanted to share a few updates regarding the KT-621 Phase Ib broaden study in moderate-to-severe atopic dermatitis patients. As noted in the release, the patients' data we plan to share will include data from 2 different dose groups. While we initially set out to explore a single dose, the speed at which the trial enrolled allowed us to evaluate the translation from healthy volunteers into patients more broadly, which we believe gives us an even richer data set to inform our Phase IIb dose choices, which was an important goal of this study. The Phase Ib was designed with a flexible protocol that contemplated this scenario, allowing us to make this choice without impacting timelines. As a result, we're well-positioned to report results in the fourth quarter as planned. I'm also happy to share that we have selected and finalized the 3 doses that will be included in the 2 Phase IIb studies, as well as completed long-term toxicity studies. These were really the final important pieces of our planning to start these studies beginning later this year. Given we're moving into data collection and analysis mode soon, we're going to limit our comments around the study to what we have said previously, until we're able to share the full results in the fourth quarter. But we can certainly say that we're pleased with the speed at which the trial has enrolled, very excited about the trajectory of the program, and we look forward to sharing the full data set when it's available. The addition of PRISM news to share is that we have selected a follow-on STAT6 degrader to KT-621 with a strong potency, selectivity and safety profile and have advanced it through all required IND-enabling studies. The degrader is IND ready should we decide to further advance it into the clinic in the future. More broadly, we're building what we believe is the best-in-industry oral immunology pipeline. And beyond STAT6, we're also very excited about what's next. Early this year, we've unveiled our oral IRF5 program, which is moving through IND-enabling studies. The compelling preclinical data we've generated showcases that targeting IRF5 can lead to correcting immune dysregulation across multiple disease pathologies, while generally sparing normal cells. It remains our goal to progress our early discovery pipeline of novel immunology programs, unveiling one new program per year to expand access to oral systemic advanced therapies for broad patient populations in this space. We hope to share more about this next year. Additionally, we announced 2 important partnership updates in June. First, we're very excited to announce our first oral molecular glue degrader program targeting CDK2 will be developed under our collaboration agreement with Gilead. We have a highly innovative research engine, and the CDK2 program is a great example of this, given the challenges of existing technologies to address this highly valued target. With our focus on immunology, this program was an ideal candidate for partnering. We and Gilead believe that a highly specific, safe and effective CDK2 degrader has exciting potential to meaningfully improve treatment for patients living with breast cancer and other solid tumors that are inadequately treated today. Secondly, Sanofi announced that they officially opted into the IRAK4 program and will assume full responsibility for development activities of KT-485, our second-generation oral IRAK4 degrader, which we expect to advance into Phase I testing next year. Based on our preclinical results, KT-485 has greater potency, broader distribution and a generally improved overall profile than KT-474, our first-generation degrader. As a result, Sanofi made the decision not to advance KT-474 into further development as KT-485 has the greatest potential benefit for patients. Both these collaborations have the potential to realize significant milestones for Kymera, which Bruce will cover later in the call, and we're happy to collaborate with 2 industry leaders on these novel programs. Finally, to support all we have ahead of us, we've extended our cash runway into the second half of 2028. We raised approximately $288 million in the follow-on offering that we launched at the end of June and received the upfront payment from Gilead, increasing our cash position to $1 billion as of the end of July. Our well-capitalized balance sheet should allow us not only to take KT-621 through the planned Phase IIb studies in atopic dermatitis and asthma, but also to prepare for and initiate several Phase III studies across multiple indications, while also progressing our earlier-stage pipeline. As you've heard me say before, our strategy centers on combining the unique power of targeted protein degradation, with carefully selected targets and pathways to create a transformative new class of medicines. By focusing on immunology, we're not only addressing large patient populations but also meeting a significant unmet need to create effective therapies. We believe our approach has the potential to deliver for the first time in our industry, biologics-like efficacy with the ease and convenience of an oral pill. Again, I couldn't be more excited about the foundation we've built and where we're going. I'm looking forward to the Q&A discussion, but let me pause here for Jared to discuss KT-621 and our pipeline.

Thanks, Nello. Looking back on the last quarter, we were excited to share the first KT-621 clinical data, which we believe greatly derisks the next stage of development. We identified clear goals for the Phase I healthy volunteer study, and the data not only hit the mark but in many instances, exceeded our expectations with compelling translation from preclinical studies to humans. The primary objective in the healthy volunteer study was to show that we can robustly degrade STAT6 in blood and skin, which we define as a reduction of 90% or more at doses that are safe and well tolerated. As shown here, the results exceeded our expectations across every measure. We showed more than 95% degradation in both skin and blood at very low doses. The safety profile was undifferentiated from placebo, and we are encouraged by the biomarker profile, which we believe is at least comparable to what dupilumab showed in healthy volunteers or patients and, in some cases, is superior. That said, I'd like to take a few minutes this morning to recap the results and next steps with KT-621, which we believe has the potential to profoundly alter how Th2 diseases are treated by delivering an oral drug with a biologics-like profile. For the full dataset, please reference the slides presented in early June, which are available on our website. As a reminder, we enrolled 118 volunteers in a randomized, double-blind, placebo-controlled study to assess single and multiple ascending doses of KT-621 across a range of doses from 6.25 to 800 milligrams in SAD and from 1.5 to 200 milligrams in MAD. In all SAD cohorts, including the lowest dose of 6.25 milligrams, KT-621 degraded STAT6 by 90% or more, and a dose of 75 milligrams or greater achieved complete degradation with greater than 95% mean STAT6 reduction and STAT6 levels below the lower limit of quantitation in multiple subjects after just a single dose. In MAD, where volunteers were dosed daily over 2 weeks, we were able to completely degrade STAT6 in both blood and skin at doses of 50 milligrams and above. In fact, to establish the lower end of the dose-response curve, we had to go back after these initial cohorts and add the 1.5-milligram MAD cohort, given none of the initially planned doses had less than 90% degradation. The robust degradation of STAT6 led to functional inhibition of the IL-4/13 pathway as demonstrated by median reductions of up to 37% for TARC and up to 63% for Eotaxin-3 at day 14, results that were comparable or superior to what has been observed for dupilumab either in healthy volunteers or in patients with Th2 diseases. Importantly, whether treated at the lowest or highest dose or anywhere in between, the safety profile was undifferentiated from placebo. There were no serious adverse events, very few treatment-related adverse events that were mild, no treatment-related discontinuations and no clinically relevant changes in vital signs, laboratory tests or ECGs with daily dosing up to 200 milligrams, which is 16-fold above the lowest MAD dose with greater than 90% degradation. As many of you have asked, we are also happy to share that we recently completed our 4-month GLP toxicology study and consistent with our earlier non-GLP and GLP tox studies, we do not see any adverse events of any type at all of the doses tested. This study completes the necessary preclinical work to allow us to initiate the Phase IIb trials planned to start later this year and early next. Prior to reporting the healthy volunteer data, we initiated a 28-day Phase Ib trial named BroADen, which was designed to enroll approximately 20 moderate-to-severe atopic dermatitis patients. We've had a high level of engagement from sites on the trial and are pleased to report that we are on track to share data in the fourth quarter. As a reminder, the key study aim is to show that robust STAT6 degradation in blood and skin lesions by KT-621 has a dupilumab-like effect on multiple Th2 biomarkers in the blood, TARC being the most relevant in atopic dermatitis patients, as well as on the Th2 transcriptome of active atopic dermatitis skin lesions. We will also assess KT-621's effect on clinical endpoints such as EASI and pruritus NRS. Beyond the Phase Ib broadening study, which again is designed as a streamlined biomarker-focused study, we are planning parallel Phase IIb dose range-finding trials to enable subsequent registrational Phase III studies across multiple indications. As Nello mentioned, we have selected the 3 doses for the studies, and our STAT6 team has done a remarkable job keeping this program moving at a rapid pace, including all the necessary work to initiate 2 global Phase IIb trials. The atopic dermatitis Phase IIb trial will begin in the fourth quarter this year, and the asthma study is expected to initiate in the first quarter of 2026. Quickly, on the IRF5 program, historically, it’s an on-drug transcription factor and genetically validated target, IRF5 is a master regulator of innate and adaptive immune response pathways involving pro-inflammatory cytokines, B-cell activation and autoantibody production and Type I interferons. We believe IRF5 degradation has the potential to be the first broad anti-inflammatory mechanism that effectively addresses immune dysregulation while sparing normal cell function. KT-579, our potent selective and oral degrader, has the potential to be the first IRF5 targeted therapy to deliver a completely novel and potentially transformative treatment option in many cases, superior to pathway biologics in a range of autoimmune and rheumatic indications such as lupus, rheumatoid arthritis, Sjögren's and others. This program is progressing in IND-enabling studies, and we expect to advance KT-579 into Phase I testing in early 2026 with what we believe will be the first oral IRF5 degrader to enter the clinic. Across our portfolio, we see strong potential to advance multiple first-in-class oral degraders that address major market opportunities in immunology. Our STAT6 and IRF5 programs represent significant advancements not only for our pipeline, but for the industry and patients as we look to deliver the first oral therapies with biologics-like profiles in immunology. We're excited about their continued progress and remain focused on our goal of expanding access to transformative treatments for millions of patients. So let me pause here, and Bruce will review our second-quarter financial results and provide a collaboration overview.

Thanks, Jared. I will quickly run through our results for the quarter. Also because this past quarter has been busy with collaboration and financing activity, I wanted to provide a brief summary of our recent news as well. As I walk through the second quarter results, please reference the tables found in today's press release and 10-Q, which was filed this morning. Revenue in the second quarter of 2025 was $11.5 million, all of which was attributable to the Sanofi collaboration. With respect to operating expenses, R&D for the quarter was $78.4 million. Of that, approximately $8 million represented non-cash stock-based compensation. The adjusted cash R&D spend of $70.4 million, which excludes that stock-based compensation reflects a 3% decrease from the comparable amount in the first quarter of 2025. On the G&A side, our spending for the quarter was $17.6 million, of which $7.4 million was non-cash stock-based compensation. The adjusted cash G&A spend of $10.2 million, again, excluding that stock-based compensation reflects a 6% increase from the comparable amount in the prior quarter. Overall, adjusted operating expenses in total were down slightly from the prior sequential quarter. We ended June with a cash balance of $963 million. Our quarter-end cash balance included the base proceeds from our $250 million follow-on offering that closed at the end of June. The June total does not include either the additional proceeds from the underwriters' over-allotment option, which was fully exercised in July or the first payment that we received from Gilead as part of our recently signed CDK2 partnership, both of which were received in July. As a result, we ended the month of July with a cash balance of approximately $1 billion, providing a cash runway into the second half of 2028. Just a quick reminder that our runway calculations exclude any unearned milestones. With that in mind, I'd like to take you briefly through the key financial terms of our 2 collaboration agreements. Starting with Gilead. Under the collaboration, we're eligible to receive up to $750 million in total payments, in addition to tiered royalties on net product sales that range from the high single digits to the mid-teens. This $750 million includes $85 million related to the upfront payment, which was received in July, and you can see on our balance sheet shown as deferred revenue and the potential option exercise. If Gilead chooses to exercise its option for an exclusive license, they will assume global rights to develop, manufacture and commercialize all products arising from the collaboration. Turning to Sanofi and the development of KT-485, under the existing collaboration, we could earn up to $975 million in clinical, regulatory and commercial milestones for KT-485. We retained the right to opt into a 50-50 cost and profit share in the U.S. prior to the first Phase III trial in addition to international royalties. If we decide not to opt in, we would instead be entitled to worldwide royalties ranging from the low double digits up to the high teens. To conclude, as you've heard today, there is a great deal of momentum across our programs. Importantly, we have the resources in place to continue executing our development strategy and the progression of our earlier stage pipeline. With that, we'll pause here so we can convene in our main conference room, at which point, we'll open the call to questions. Thank you.

It's Paul on for Michael. I had one on the dose levels that you're exploring for 621. Maybe first, could you provide some color on that decision to add the second dose in the Phase Ib study, I think it's probably safe to assume that both doses fall within the broad range that achieved complete STAT6 degradation, but just wondering how you're thinking about exploring both the high and the low dose, which is perhaps 2 doses in the higher range?

Yes. Thanks, Michael. We want to make sure you're hearing us. So as we said today, both doses are within the range that we explored in the Phase I healthy volunteer study. And as we've said, we initially decided to explore one dose, thinking that roughly 20 patients will be enough to give us the data to speak to the profile of that one dose. Obviously, as we were moving along with the enrollment and given how quickly it was going, and given that we were able to assess the performance in the one dose, we decided to explore an additional dose so that we could get even more robust translation from healthy volunteers to patients of STAT6 degradation. I think it's important to keep in mind that in the healthy volunteer data, we had multiple doses. I would say, almost all those doses besides one met our target product profile. So we wanted to confirm that the really robust profile could be translated into patients with the same level of fidelity. I think we're happy that we did that. Obviously, I'm not going to speak to high, low, medium, etc. Rest assured that the main goal was really to refine the Phase IIb dose selection. All that happened so quickly that now between the healthy volunteer data and whatever data we have access from this study, we're able to firm up and select the Phase IIb doses even in the absence of completing the Phase Ib study.

Congrats on the progress here. So just one follow-up. I want to understand maybe following up on this line of questioning just in terms of what you would expect to see at these additional doses that you're looking at in the Phase IIb, ultimately, like we saw very good degradation and pretty quickly. So I guess how do you think some of the doses will differentiate? And then just a follow-up to that, what do you actually expect to see with the follow-on STAT6 that you're developing? And what sort of optionality are you really looking for with that molecule?

Great question, Derek. So the first one, I just want to confirm we're talking about the dose for the Phase IIb. I think the important thing to drive is, obviously, to find a dose that has the best risk-reward profile. So I think what we want to ask in a 16-week study is what is the maximal or we believe close to maximal at that point level of clinical activity that we will see and what is the safety profile at different levels of degradation. Obviously, we will explore maximum degradation, which we call complete, which again is where we see in most subjects, STAT6 levels be below the lower limit of quantitation. We want to ask that question, what is the clinical profile of maximal degradation? Then, obviously, we want to ask the question at a couple of lower doses just to ensure that we're taking into Phase III the profile that we believe has the best risk-reward. So it's obviously a necessary step we need to take as a company to fulfill regulatory requirements to do dose-ranging studies before selecting a Phase III dose. I think we have bets in the company where the Phase III dose will be already, but we got to run the studies and make sure that we do all the right steps to de-risk the program. With regard to the follow-on molecules, that is something many of you who have followed us for years know that every program, we always have a next-generation molecule as you saw for IRAK4, Sanofi decided to focus the efforts on the follow-on at we call it the next-generation molecule KT-485. For STAT6, to be honest, we didn't really have a particular goal with the next-generation compound given how well KT-621 has performed. This is the reason why we've advanced a very good molecule that, in many ways, looks at least in terms of profile very much like KT-621. It's potent, extremely well tolerated, very active in vivo. The principle is to support the franchise for one is for the eventual likely scenario that we need another molecule or for a strategic choice of advancing another molecule should we choose for different severities or different indications. Given how well KT-621 is doing, we have decided for now to keep this follow-on molecule IND ready, meaning that we have everything we need to file an IND, but we're not planning to file an IND in the short term. Another important point in this highly competitive space is STAT6 is becoming, having a molecule line ready probably ahead of any other competitor that is behind us. So we have 2 molecules ahead of every other competitor. I think it also sends a message how committed the company is to this franchise and to the potential of this franchise.

Two for me as well. Maybe the first, recognizing the primary objective of the Phase Ib data, is to show a dupilumab-like profile here on biomarkers, but I was hoping you might be willing to frame your expectations on what you'd like to see on the clinical efficacy measures, particularly EASI 75 as well as NRS. And then secondly, just noting the completion of the GLP tox studies that you mentioned. And obviously, your Phase I healthy volunteer also looked really clean, but if you could just speak to the potential safety risk of degrading STAT6 completely, what type of signals are you most looking for in the Phase Ib to really feel comfortable here with the safety profile as you move forward?

Thanks. Great question. Jared, I thought maybe you could take at least the first one, if not both.

Yes. In terms of the clinical expectations, I think we emphasize always that the primary objective here is to show robust STAT6 degradation in the blood and in active atopic dermatitis skin lesions and to show that that results in a dupilumab-like biomarker, in fact, both in blood and skin. We're looking at the Th2 transcriptome and we don't want to see a dupilumab-like effect there. We sort of have set expectations around biomarkers. I think TARC is the most important blood biomarker probably in atopic dermatitis, where dupilumab studies have shown even at 28 days about a 70-plus percent reduction. That's a general bar that we would expect to see in patients who, as in those dupilumab atopic dermatitis studies, had greatly elevated TARC levels at baseline. We'll be looking at other biomarkers in the blood, as well as these various transcriptional biomarkers in the skin. In terms of clinical endpoints, again, we've always emphasized that in the absence of a placebo control, these are more exploratory. However, we think we do have an opportunity to look at endpoints like EASI and pruritus NRS and IGA because we know from dupilumab that you can see impact on those biomarkers as early as 28 days. We're not really giving specific numbers where that bar would be set. I think the published data are out there with dupilumab and one can look at those published data at 28 days and get a sense for what we mean by being in the ballpark with regard to those clinical endpoints. In terms of your second question around safety risk, as you noted, we've been very pleased with what we've seen in our GLP tox studies. We've completed our four-month tox studies as now indicated, and we've seen no safety signals whatsoever. That's very in line with our four-week GLP tox in our prior non-GLP tox studies. We are very encouraged by the fact that our safety profile was undifferentiated from placebo in healthy volunteers with 2 weeks of dosing. So that's very encouraging. Now we'll be looking at safety with 4 weeks of dosing, of course, in the Phase Ib. I think overall, this is in line with our expectations based on our mechanism of action and based on the fact that it appears that STAT6 is highly selective for the IL-4/IL-13 pathways and human genetics. I have pointed not just to the phenotype of abnormalities of STAT6, but also to the safety of knocking down STAT6 have mouse knockout studies. This is all in line with what we expected for a transcription factor that is very specific for IL-4 and IL-13, and for a drug like ours, and it's highly selective just for STAT6.

Thanks, Jared. I wouldn’t change anything I said. I just want to clarify that, as Jared mentioned, comparing clinical endpoints is challenging, especially when evaluating placebo-controlled randomized studies. It’s even more complex to compare noncontrolled studies. However, I want to emphasize that we expect our drug to be very effective. I don’t want to avoid the comparison challenge; we anticipate that our mechanism will perform similarly to what dupilumab has demonstrated, and that sets the standard for us without getting into specific numbers.

Just wanted to ask on the doses for the Phase Ib and the Phase IIb. Are you able to confirm if the dose that you added to the Phase Ib is higher or lower than the dose that you originally went in with. And could you also confirm if either or both of these doses are part of the 3 that you've selected for Phase IIb?

I don't want to get into higher or lower, because I think whatever I say, it's going to be viewed one way or the other. What I can say is that both doses have been tested in the healthy volunteer studies. I don't want to talk about what our doses are for the IIb because I think we might choose to keep that, as I've said in other venues, to keep that close to the vest for as long as we can, only for competitive reasons. All I can say that we have several doses in the healthy volunteers that performed really well. The main driver here is these doses going to perform as well in patients. I actually don't remember the number, Bruce will know better, but we're spending tens, if not 100 plus millions of dollars in these 2 studies. We're not going to optimize over these studies on making or thinking that we selected the right doses. These are consequential decisions. Given that we had the time to do it, we said let's make sure. So that's really what's behind these. Once we share the data, we can add a bit more color to it.

Great. And if I kind of a quick follow-up on that point. And mostly on just what back into the dose selection for the Phase II studies? Was it predominantly the healthy volunteer data you presented? Was there anything emerging from the Japanese studies or GLP tox? Can you say if there's a different range of doses being explored between the atopic dermatitis and asthma studies?

Yes. So great question actually. So if you look back at the healthy volunteer data, there was a dose selection based on this data. Everything else that we've done has been able to confirm our initial instinct. We didn't learn, to be honest, anything new that made us change the initial instinct, let's say, on dose selection, but it was highly encouraging that everything that we've seen in healthy volunteers was supported by the four-month tox, which we said was completely clean. The Japanese study was very much in line with the U.S. study as well as the early data for the Phase Ib.

Congrats on the progress here. So just 1 and a follow-up. So basically, I just want to understand maybe following up on this line of questioning just in terms of what you would expect to see at these additional doses that you're looking at in the Phase IIb. Ultimately, like we saw very good degradation and pretty quick. So I guess how do you think some of the doses will differentiate? And then just a follow-up to that, what do you actually expect to see with the follow-on STAT6 that you're developing? And what sort of optionality are you really looking for with that molecule?

Great question, Derek. So the first one, I just want to confirm we're talking about the dose for the Phase IIb. The important thing for us is to find a dose that has the best risk-reward profile. So, in a 16-week study, we want to determine the maximal, or close to maximal, level of clinical activity that we will see and the safety profile at different levels of degradation. We will explore maximum degradation, which we call complete, and want to see what the clinical profile of maximal degradation is. We want to confirm that the robust profile we've established in healthy volunteers can be translated into patients. On the follow-on molecules, every program has a next-generation molecule. We've advanced a good molecule that, in many ways, looks very much like KT-621. It's potent and well tolerated. We want this IND ready, but we aren't planning to file one in the short term. Given how well KT-621 is doing, we have two ready before any competitor that could signal our commitment to this franchise.

I have two as well. The first, recognizing the primary objective of the Phase Ib data is to show a dupilumab-like profile here on biomarkers, but what do you expect to see on EASI 75?

Great question, Jared.

Yes, we emphasize the primary objective here is to show robust STAT6 degradation. We are looking at EASI for clinical endpoints, and while these may be exploratory in the absence of a placebo control, we expect impacts based on past studies. We have a general bar for TARC that we expect to reach in patients with elevated levels at baseline. We are also looking at other biomarkers in the blood and various transcriptional biomarkers in the skin.

Thanks, Jared. In summary, we expect that this mechanism is going to be on par with what dupilumab has shown, and that's the bar for us.

Wanted to ask on the doses for the Phase Ib and Phase IIb. Can you confirm if the dose added was higher or lower than originally?

I don’t want to get into specifics on high or low doses as it could be interpreted differently. Both doses we've tested in healthy volunteers. I won’t disclose Phase IIb doses yet for competitive reasons, as we believe various doses performed well in healthy volunteers.

Could you provide some color on that decision to add the second dose in the Phase Ib study?

Would you like to confirm some dosing details for the Phase II studies? Any insights on the ordinality of these studies?

We are excited to maintain this momentum and are happy with the progress we’ve made on our Phase II studies.

We will continue to track the safety as well as the treatment.

Thanks everyone for being here today, and for your questions. We're excited about the progress we've made and look forward to keeping you updated.

The next question is from Michael Schmidt from Guggenheim.

Congrats on the progress team. Any color you're able to provide on the baseline EASI scores of the patients you're enrolling or have enrolled? And I wonder always about the screen failure rate for atopic derm trial sites. And maybe just remind us how you're measuring degradation in skin tissue.

We’re not commenting on baseline EASI yet. The entry requirement is EASI greater than or equal to 16. We have strict criteria for ensuring only appropriate patients enter the study to minimize screen failures. We assess STAT6 levels via biopsy for accurate measurement.

Can you speak to payer willingness to cover therapies in dermatology and the opportunity here given alternative administration formats?

We believe the case for an oral option speaks for itself. Oral availability increases adoption with reduced barriers, while also highlighting the oral option's improved impact on quality of life. We aim to expand options for patients significantly.

Yes, our focus is on achieving a robust profile and aiding the treatment landscape with our offerings.

With respect to the IRAK4 collaboration, can you provide additional insights into the exchange of KT-474 for KT-485?

Sure, the decision was made by Sanofi to focus on KT-485, which has demonstrated an overall better profile based on preclinical data compared to KT-474. We believe that both clinically and commercially it’s a strategic move that will serve our collaboration well.

We are following trends in IRAK4 based on ongoing studies and evolving experiences.

Could you elaborate on your thoughts about the signals you monitor for any safety risks associated with STAT6?

We’ve had promising results thus far in our studies and look forward to further assessing safety as we continue with our trials.

We look forward to sharing all our data with you soon. Thanks for your interest.

Thank you all for your questions today. We appreciate your time and will keep you updated on our future developments.

There are no more questions at this time. I would now like to turn the call over to Nello Mainolfi for closing remarks.

Well, thanks, everybody. Sorry, we went a bit too long today. Another exciting quarter. We're here for any follow-up questions. You know where to find us, and thanks again for joining. Have a great day.