Hello, and thank you for standing by. Welcome to the Nektar Therapeutics fourth quarter 2025 financial results conference call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Vivian Wu from Nektar Therapeutics Investor Relations to kick things off. Please go ahead.

Thank you, Crystal, and good afternoon, everyone. Thank you for joining us today. Today, you will hear from Howard W. Robin, our President and Chief Executive Officer; Dr. Jonathan Zalevsky, our Chief Research and Development Officer; and Sandra A. Gardiner, our Chief Financial Officer. Dr. Mary Tagliaferri, our Chief Medical Officer, will also be available during the Q&A. They are subject to uncertainties and risks that are difficult to predict and many of which are outside of our control. Our actual results may differ materially from these statements. Important risks and uncertainties are set forth in our latest Form 10-Q available at sec.gov. We undertake no obligation to update any of these forward-looking statements whether as a result of new information, future developments, or otherwise. A webcast of this call will be available on the IR page of Nektar Therapeutics’ website at ir.nektar.com. With that said, I would like to hand the call over to our President and CEO, Howard W. Robin. Howard?

Thank you, Vivian, and good afternoon, everyone. 2025 was a pivotal year for Nektar Therapeutics, and we continue to build on the success with significant progress in 2026. In 2023, we unveiled our plans to focus on the advancement of our immunology and inflammation pipeline programs, which center around the biology of T regulatory cells. In October 2023, we began the first phase 2 study of our novel Treg biologic Respag Aldesleukin, in patients with moderate to severe atopic dermatitis. In early 2024, we began our second phase 2 study with alopecia areata. And just last year, a third phase 2 study in type 1 diabetes was initiated with our collaborator TrialNet who is funding and sponsoring this trial. In 2025, we saw the successful outcome of several years of hard work by our team as we achieved the first positive results from the two phase 2b studies of Rezpeg in atopic dermatitis and alopecia areata. Results validated that our novel regulatory T cell mechanism could produce clinically meaningful outcomes in two dermatological and inflammatory disease settings. And just last month, we reported on the long-term monthly and quarterly dosing results from the 36-week maintenance portion of Resolve AD in atopic dermatitis. These data showed a significant durability of efficacy that was highly competitive to what is seen with other biologics and establishes what our novel Treg mechanism is capable of achieving. Monthly or quarterly dosing of ResVeg during the maintenance period showed a deepening of response with increases in EASI-75, EASI-90, and up to fivefold increase in EASI-100 scores. Both atopic dermatitis and alopecia areata are inflammatory dermatological diseases that impact a significant number of patients worldwide. In the U.S. alone, there are over 15 million people with moderate to severe atopic dermatitis. It is estimated that today, only 10% to 15% of patients are receiving biologic treatments for this chronic skin disorder. Driven by the rapid adoption of biologics, the atopic dermatitis market is expected to grow to $35 billion by the mid-2030s. Although Dupixent and IL-13s are the predominantly used therapeutics today to treat these patients, about 50% of patients fail to respond or lose treatment effect over time with IL-13 based approaches. This leaves a significant opportunity for a novel immune modulating mechanism like Rezbeg to enter the treatment paradigm. And the competitive landscape has recently narrowed for the late-stage novel MOAs being advanced to BLA filing. We believe this puts Respect in a lead position as a novel MOA, which could offer both a differentiated efficacy and safety profile with a better dosing regimen and the potential to offer patients complete clearance of disease over time. In alopecia areata, there remains a need for an efficacious and safe biologic with a better efficacy and dosing profile. Currently approved JAK inhibitors are effective at regrowing hair in some patients, but they carry a number of drawbacks, and more than half of physicians and patients are hesitant to use these agents because of the safety risks and the associated monitoring burden they pose. Importantly, the JAK class has poor durability, and nearly all patients lose their hair after treatment cessation. With the 36-week data from RESOLVE AA establishing a clinical efficacy profile similar to low-dose JAK inhibitors in alopecia, we are looking forward to seeing the 52-week data from that study in April. For patients who enter the blinded 16-week treatment extension, we will be evaluating the potential of ResMed to deepen SALT reductions including zoo SALT 20 responses. Rizpeg's differentiated clinical profile and a safety database of over 1,000 patients treated to date equivalent to 381 patient-years of exposure, provides an exceptionally strong basis for advancing ResMed into phase 3 studies. In June, we will be randomizing the first patient in the phase 3 studies in atopic dermatitis. We now have alignment with the FDA on our phase 3 dose, the 24-week induction treatment period, and other critical phase 3 study design elements. Jay Z will review that in a moment. We expect to have the first data from phase 3 in mid-2028 and meet our goal to submit a BLA in 2029. We ended 2025 with $245.8 million in cash and investments and with no debt on our balance sheet. Since year-end, we have also raised approximately $476 million in additional net cash through both a public offering and exercising a portion of our ATM. Our very strong balance sheet now allows us to move quickly into phase 3. I will now turn the call over to Jay Z, who will share more on RespEG and our other immunology programs. Jay Z?

Thank you, Howard. To start off, I would like to comment in more detail on the significant progress we have made with Respag that Howard highlighted moments ago. Respag is a very unique Treg biologic that capitalizes on a critical immune pathway. As a highly selective agonist of regulatory T cells, it is designed to address the underlying immune balance of multiple inflammatory pathways. This past year, we have shown through our phase 2 clinical datasets that Respag is truly differentiated as a novel MOA and late-stage biologic candidate with a compelling efficacy profile and that it can also offer long-term extended dosing frequency. This phase 2 data adds to the 36-week off-drug disease control or remitted potential of Respact that we demonstrated in the earlier phase 1 trial. And now Respag is a phase 3 ready program. And we have one of the largest safety databases for agents in mid to late-stage development in atopic dermatitis, which is now established in over 1,000 patients spanning about 381 patient-years of exposure. In atopic dermatitis, our 16-week induction data reported last June established that ResMed has a rapid onset of key efficacy metrics separating early from placebo after one or two doses on EASI-75, EASI-90, and itch relief. And notably, our induction data established Respag as the first novel MOA to show strong itch relief in conjunction with skin clearance without the need for topical corticosteroids. We know that itch relief is a major driver of improved sleep scores and better quality of life for patients with atopic dermatitis, and this translated into achieving statistical significance on these patient-reported outcomes in our study as well. At the high dose of 24 mcg/kg given every two weeks in induction, we also saw comparable efficacy data for both EASI-75 and EASI-90 in the moderate and severe patient populations enrolled in the trial. The study was stratified by vIGA baseline scores of four and three, and efficacy was comparable among both these populations. And this attribute emerges as a key differentiating aspect for what has been seen with Dupixent treatment. Respag has also shown promising positive results in treating atopic dermatitis patients with self-reported comorbid asthma. We reported this data for the ACQ-5 endpoints for Bresolve AD last year at ACAI. Outside of Dupixent, no other approved agent or agent in development has shown the ability to improve atopic dermatitis and comorbid asthma at the same time. In induction, Respag resulted in statistically significant and clinically meaningful improvements in ACQ-5 scores at 16 versus placebo in patients and a 75% improvement in these scores in patients with uncontrolled asthma at baseline. And approximately one in four atopic dermatitis patients also have comorbid asthma, and Respag is the only novel MOA to show improvements in this endpoint. With the 36-week maintenance data reported last month, we demonstrated two additional critical features of Respag that differentiated it from approved agents and those in development. First, we saw significant maintenance in efficacy, and we also saw deepening of response with continued treatment out to 52 weeks, including improvements in EASI-75, EASI-90, itch, and vIGA endpoints. Notably, we saw an up to fivefold increase at EASI-100, as Howard mentioned earlier, underscoring the potential for Respag to give patients complete disease clearance with extended treatment over time, and setting a new benchmark in atopic dermatitis. And second, we established that extended monthly and quarterly dosing could be used as a long-term treatment regimen with Respag after inducing responses. As I stated earlier, with over 1,000 patients treated to date, and about 381 patient-years of exposure, Respag has a well-established long-term and favorable safety profile. As seen in our reported data, we have generated a differentiated safety profile with no increased risk of systemic adverse events such as conjunctivitis, infection, or malignancy. The RESOLVE AD data informed our phase 3 program and we will start the first pivotal study in June. Following our end of phase 2 meeting, we now have alignment on plans for a phase 3 program to evaluate a single dose 24 mcg/kg twice monthly for the 24-week induction period. Patients who achieve EASI-75 or vIGA responses will then be rerandomized to monthly and quarterly regimens out to 52 weeks. The design of phase 3 will be similar to those studies used for registration of other biologics. Our plan is to utilize, as other phase 3 have, the primary endpoint of a vIGA-related endpoint required for U.S. registration and an additional EASI-75 endpoint to support EU approval. Our phase 3 program will evaluate both biologic-naive and treatment-experienced patients. Beyond atopic dermatitis, in December, we also established a proof-of-concept with the data from RESOLVE AA for Respag in severe to very severe alopecia areata. We were pleased that these data have been accepted as a late-breaking presentation at the upcoming AAD meeting in March. It is the only dataset in alopecia areata that was accepted for presentation in the late-breaking session. In the RESOLVE AA study, as we reported in December, Rezpeg demonstrates an efficacy response that met our target product profile expectations, which was to achieve efficacy similar to low-dose JAK inhibition at week 36 with every two-week dosing, and maintain a more attractive and favorable safety profile. We believe the data position RespEx as a potential first-in-class biologic in alopecia. As Howard stated earlier, the RESOLVE AA study also included a blinded 16-week extension for patients who reached week 36 in the study but had not yet achieved a SALT 20 score. We plan to report the data from this treatment extension in April. To that end, we will initiate a quiet period beginning April 1 until we unblind and report the data from the treatment extension. As a reminder, the only available systemic therapies that are FDA approved for the treatment of alopecia areata are JAK inhibitors. But these contain a number of black box warnings and laboratory monitoring requirements. Nearly all patients also experience hair loss after treatment cessation. With the limited treatment options available in alopecia areata, we believe there is a unique opportunity for a novel immune-modulating Treg mechanism like Respec to offer attractive dosing as compared to a daily pill and a potentially more favorable safety profile. Following our 16-week treatment extension data, we expect to hold our end of phase 2 meeting with the FDA for alopecia areata in the second quarter of this year. And following that, we plan to share more about our plans for advancing into phase 3. Before I move on to our earlier antibody program, I want to mention our ongoing phase 2 study with Respag for type 1 diabetes. This study, sponsored and funded by TrialNet, is evaluating Respag in patients with new-onset stage 3 type 1 diabetes. Per protocol, patients will be randomized 2:1 versus placebo, and receive Respag every two weeks for six months. The study is broken into three cohorts beginning with adult subjects, ages 18 to 45, and moving into patients as young as 12, and then 8 years of age. We are excited to be working with TrialNet. This consortium of type 1 diabetes specialists in the U.S. also ran the first studies for Tisdale, also known as teplizumab, in type 1 diabetes. They have a strong commitment to finding and evaluating new therapies that can help patients with this devastating diagnosis. We believe and expect initial data from the trial that sponsored phase 2 sometime in 2027. One of the important paradigms of our work is that, by creating a first-in-class Treg targeting approach like RESTPAC, we have confirmed what we have always felt as immunologists, that Tregs were essential for so many different diseases and that they could be therapeutically targeted for disease treatment. Based upon low-dose IL-2 and Treg biology, either genetically or assessed clinically, we know that there are so many indications beyond what we are exploring in our current phase 2 studies that are potential opportunities for Respect. These include therapeutic areas such as our skin, and autoimmune diseases, THC such as food allergies or asthma where we have already seen a signal, and chronic rhinosinusitis. It also includes skin disorders such as dermatomyositis, and also potentially immune diseases such as Sjogren's syndrome. As we advance Respag in phase 3, we look forward to the possibility of generating additional proof-of-concept data in additional indications which could expand the future label for RespEx. Moving on to our earlier pipeline programs. NKTR-0165 and NKTR-0166, our TNFR2 agonist and bispecific programs. We expect to present preclinical data from this program at a scientific conference in 2026. This molecule has a very high specificity for signaling through TNFR2 on Tregs to enhance and optimize their ability to regulate the immune system, which we believe could be impactful to multiple sclerosis, ulcerative colitis, vitiligo, and other I&I indications. In the first quarter, we announced an academic research collaboration for NKTR-0165 with Dr. Steven Hauser at UCSF to explore the potential role of TNFR2 agonism in the reduction of neurodegeneration, promotion of neuroprotection, and cell repair. The work being funded by UCSF will look at Nektar-0165 in patient-derived B-cell models of multiple sclerosis. We are looking forward to working with Dr. Hauser to inform future development work for this important molecule. Leveraging our learnings from the development of NKTR-0165, we have designed a bispecific molecule called NKTR-0166. This bivalent antibody incorporates a TNFR2 agonist epitope and an antagonist epitope that has been previously validated in the treatment of rheumatology diseases. As a dual agonist/antagonist of known pathways, NKTR-0166 has the potential to modify disease pathogenesis in a number of autoimmune disorders. And we are planning for IND submission for one or both programs in 2027. And with that, I will now turn it over to Sandy to cover the financials.

On today's call, I will review our quarterly and full year 2025 financials and share our preliminary financial guidance for 2026. We ended 2025 with $245.8 million in cash and investments and with no debt on our balance sheet. In February, we completed an underwritten public offering for $460 million resulting in approximately $432 million in net cash proceeds for the company. We also accessed approximately $44 million of net proceeds to date from our existing $110 million ATM facility in 2026. We now have a strong balance sheet to invest in our pipeline and advance our phase 3 program in ResPay. I will now provide a quick review of our 2025 financials. Our revenue was $21.8 million for the fourth quarter and $55.2 million for the full year 2025. Our R&D expenses were $29.7 million for the fourth quarter and $117.3 million for the full year. Our G&A expenses were $11.2 million for the fourth quarter and $68.7 million for the full year. Our non-cash interest expense for the fourth quarter was $9.8 million and $26.2 million for the full year. And our net loss for the fourth quarter was $36.1 million or $1.78 basic and diluted net loss per share. For the full year of 2025, our net loss was $164.1 million or $9.73 basic and diluted net loss per share. We are providing very preliminary 2026 guidance on today's call. The guidance ranges are wide as we are still completing the planning and budgeting activities for the Respag phase 3 program. We began investing in startup activities for this program last year with production of drug supply and placebo. And as Howard stated earlier, we plan to randomize the first patient in June. We expect an updated 2026 budget at that time and will update our financial guidance as necessary. With respect to our 2026 P&L guidance, our non-cash royalty revenue for the full year of 2026 is expected to be between $40 million and $45 million. Based on our current forecast, we anticipate that full-year R&D expense could range between $200 million and $250 million, including approximately $5 million to $10 million of non-cash depreciation and stock-based compensation expense. We expect G&A expense will decline in 2026 over 2025 to a range of $60 million to $65 million. This includes approximately $5 million of non-cash depreciation and stock-based compensation expense. Our full-year non-cash interest expense is expected to be between $30 million and $35 million. Additionally, we do not expect any significant gain or loss on our equity method investment in 2026. Lastly, we expect to end 2026 with approximately $400 million to $460 million in cash and investments. And with that, we will now open the call for questions.

Thank you. As a reminder, to ask a question, please press 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press 1-1 again. In the interest of time, we do ask that you please limit yourself to one question at this time. And our first question will come from Yasmeen Rahimi from Piper Sandler. Your line is open.

Good afternoon, team. Thank you so much for all the great updates. Maybe a quick question that is sort of two-part. One is, given congrats on presenting the RESOLVE AA study at the AAD, hope to understand, Jay Z, what type of new data we could see. Was it just more an opportunity to showcase it? And then part two is maybe help us frame what you hope to see in this blinded 16-week treatment extension period. What does the ResPEG need to show to be highly competitive both in regards to mean SALT reduction as well as SALT 20? Thank you, and I will jump back in the queue.

Thanks, Yasmeen. So of the things that we will be presenting later and that is coming up in the future data presentation is remember that the way the study was designed is that it was a 36-week treatment period. However, patients that had begun to grow hair but had not yet reached a SALT 20, they were permitted to advance into a 16-week additional extension, which was also a blinded portion of the study where they could receive dosing all the way to week 52. And when we presented the data in December, we had already indicated that there were already three patients that had entered into that period as of the time of that December data cut when we presented the results last year that had already reached the SALT 20 after week 36. And those patients were not even considered in the week 36 numerator because their response happened afterward. So, when you kind of then ask what is the tone of the presentation that we will be making, once we begin our quiet period in April and after we present the top-line results, we will be sharing the additional effect of treatment with Respag and the potential of additional patients to convert to achieving SALT 20 responses as well as deepening their SALT reductions over that additional 16-week treatment period. And I think you are kind of potentially starting to see a bit of a paradigm we saw in atopic dermatitis as we extended the duration of dosing to week two in maintenance. Patients treated with raspeg continued to develop additional efficacy and we think there is a potential that that could happen as well in alopecia areata as we have already seen three patients achieve response that way. So we will be sharing the totality of that patient population. All of the patients will have completed week 52 that entered into that extension period, and that will be the nature of the results. In terms of what we would like to see for what would be competitive, BEST PAC has already demonstrated quite a different profile from a JAK inhibitor. You consider all of the upsides of growing hair, but then balanced by the downsides as both Howard and I mentioned in our presentation, there are really significant safety issues and risks that may make taking a JAK inhibitor chronically very challenging. And, particularly, it is a class of drug that is difficult for dermatologists to use owing to the laboratory monitoring and the additional work and risk that the patients have. And then when patients have to stop taking a JAK inhibitor for any reason, pretty much everyone loses all the hair that they might have grown when they were on the JAK inhibitor. So we would like to see an efficacy profile that reaches low-dose ILUMENTE. I think we have a very good shot of getting to that level. And then we would like to deliver all of the other things that Respect has already shown, which are a completely differentiated safety profile, a much more convenient dosing frequency relative to a once-a-day pill, and really an opportunity to provide a much better biologic that can be used chronically in this chronic indication. Thank you for the question, Yasmeen. Thank you.

Thank you. Our next question comes from Julian Harrison from BTIG. Your line is open.

Hi, thank you for taking the questions and congrats on the progress. Regarding the phase 3 program in atopic dermatitis that is expected to initiate next quarter, would you expect the ACQ-5 data to make its way into the potential label from those trials? If so, I am wondering how enabling you would expect that to be commercially relative to dual labeling, both in atopic derm and asthma. And then sorry if I missed it. I am curious also what percentage of bio-experienced patients you plan to enroll in your atopic dermatitis trial that is upcoming. Is there a defined target there?

Sure. Mary, would you like to answer that?

Sure. Hi. So we are including the ACQ-5 in the phase 3 program, and we will look at this at baseline and through induction, and then we will also look at the ACQ-5 through maintenance. And we are going to power for, and we will control for multiplicity for the ACQ-5. And we will, you know, make every effort to include that in the label, and that is certainly a part of our plan. With respect to bio-experienced patients, we are anticipating roughly 25% of the patients in our phase 3 program will be bio-experienced and then 75% of the patients will be biologic/JAK inhibitor naive.

Very helpful. Thank you.

Yep. Thank you. Our next question comes from Jay Olson from Oppenheimer. Your line is open.

Hi, this is Sean calling for Jay. Thanks for taking the question, and congrats on the progress. Just on the AD part, I am just wondering for the phase 3 trial and also for future commercial launch, what are the formulation or device for RedfinQ right now? And, also, wondering if there are any protocol guidance or implementation of ISR mitigation strategy for your phase 3 or if you think that is necessary? Thank you.

Yeah. Hi. So sure. So I can cover the question about the formulation, and then I will turn it over to you, Mary. So Respag is a very low-volume administered agent. So patients receive—most patients receive 1 milliliter, 2 mL max depending on their body weight. And then our plan is to run phase 3 in the same way that we ran the phase 2 where the drug was presented as a vial, and then at study site, it is drawn up and administered to the patient by staff at the study centers. But our plan for the commercial launch is to launch Respag in an auto-injector, coupled with an auto-injector device. And so for that, we will be switching to what is called weight-banded dosing. So we will not need to use weight-based dosing because patients will be dosed according to their body weight. And then we know that will have a lot of opportunities and also advantages. This will be a very straightforward self-administered product, very similar to all the biologics that are used in single-use pen devices. And then regarding some of the way we will run the phase 3, I will turn that over to Mary.

Yeah. Hi. So first, I think it would be a good idea to just review the ISR cases that we have seen across our program. And 99% of the ISRs were mild to moderate in severity, with the vast majority being mild and only 1% severe. And we do see a very, very, very low dropout rate due to ISRs. The reason for that is these ISRs are not like what we are experiencing in PULS. Was launched. We do not commonly see pain, do not commonly see pruritus. The vast majority of patients, 96% of them, are just having erythema or redness. And, likewise, these patients are not having ISRs every time they receive an injection. In fact, we see, really, the vast majority of patients are really only having two or fewer during the course of treatment. In terms of how these are managed, patients use cold compresses with ice. And if need be, they can also use a topical corticosteroid. But since the vast majority of patients do not have pruritus, for the most part, patients are not needing to use a topical corticosteroid. We, you know, did have Dr. Jonathan Silverbirds on in our last presentation of the maintenance data. You know, he certainly underscored that the trade-off is an easy choice for patients. These patients, you know, are having severe itch, and with Rezpeg having that very rapid itch relief and resolution of atopic dermatitis, with the trade-off being an erythematous ISR, that, you know, overall, the risk-benefit highly favors ResTech as a treatment for atopic dermatitis.

Great. Thank you very much.

Thank you. Our next question comes from Roger Song from Jefferies. Your line is open.

Great. Congrats for the progress and thanks for taking the question. My question relates, I think, to the last data cut for the alopecia areata. You have three patients reach SALT 20, and then another seven patients reach SALT 30. Just curious, what are the dosing for those three and the seven patients? And then given if they are deepening the response, since you are getting towards high-dose ILUMEN, you know, based on your market research and then your adviser, will this efficacy reaching high-dose ILUMYA change the potential clinical adoption compared to the low dose? Thank you.

Yeah. Hi, Roger. Yeah. So thanks, Roger.

No. Thank you for your question, Raj. So, you know, I just want to reiterate that the study is blinded. Right? And so when we share the results coming up very soon, in April, we will unblind, and we will present all of the results for all of the patients that made it through to the extension period. So that will be, you know, an update for us very, very soon. And then in terms of the TPP, you know, one of the really important elements is that this is a biologic and it brings a completely different profile. And our objective was always to achieve the TPP of low-dose JAK inhibitor Lumant. And we believe we have already met that with the data that we have. We believe that 52 weeks is the correct duration of extension. So for example, in the phase 3 that we plan, we know we would be treating longer than 36 weeks. And we know that there is an opportunity with the additional treatment duration, you know, to potentially elicit even more efficacy of effect. I think there is just this really white slate kind of an opportunity because the first time a biologic moves into an autoimmune indication, it could have a very profound effect on prescribing patterns from physicians. Many doctors are much more comfortable prescribing a safer biologic as opposed to a more difficult-to-manage and potentially more challenging agent like a JAK inhibitor. So it is something we are very, very excited about. And then, you know, it is a data update that we are really looking forward to coming up. And it is a TPP that we think could be a really big opportunity for Respag in the future.

Got it. Thank you.

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

Yes. Good afternoon, team. Thanks for taking our questions, and congrats on the progress. So another alopecia question. Sorry if I missed this. What incremental data relative to the December update you would get at the conference? And if you could comment on any plans for releasing the off-therapy data for the responders that you had. I know you had efficacy responses still climbing as part of the 16-week extension, so I was not sure at what point you would look at the off-therapy data. And then just a little high-level question for Howard, if I may. You know, the EASI-100 responder rate—how important do you think of that as a differentiator? I know if many agents get there. I also ask that in context of the initial framing of a large growing ATD market, you know, which could have multiple entrants around the time, you know, you get on in 2029. I understand the near-term launch landscape has certainly narrowed, but we are just thinking longer term.

Well, I will answer the last part of the question first, then turn it over to Jay Z and Mary. I think EASI-100 has not been looked at very closely, and it has not been reported very much because very few people attain the levels that we have been able to attain. So if you look at the maintenance data where we have achieved, you know, 30% or so EASI-100 scores, again, I think that is very important, and it leads to essentially, it leads to effectively complete clearance of the disease in these patients over time. And it has not been talked about much, and people talk about 75 and 90. That is because it is really difficult to achieve EASI-100, and we have done it. So that I think says a lot about the potential for the Treg mechanism in general. I will turn the rest of the question over to Jay Z and Mary.

Sure. Thanks, Howard. And, Mayank, you asked many, many questions in one question, 12-part. So let me just make sure I catch them all. So in terms of the AAD presentation, it is, you know, coming up in just a couple of weeks. So you can see, you know, all of the data that is presented, and it will be presented in the medical conference, right, by a physician. In terms of the rest of the study, we do have a catalyst later this year, which will be the 24-week off-drug period of evaluation from the alopecia areata study. But that is not going to be data that we touch on either at AAD or in the April data presentation, which just focuses on the end treatment at week 52. In the second part of this year, in the later part in the fourth quarter, we will present the results of the 24-week off-drug period. So those will be just future catalysts to look forward to for Respag in alopecia areata. Thank you for your question.

Thank you.

Thank you.

And our next question will come from Samantha Cemenko from Citi. Hi, good afternoon. Thanks very much for taking the question. Let me ask one about the type 1 diabetes study. I am wondering if you could just share a little bit more about that trial. I know there is growing interest and development here. I am wondering how you see Respag potentially differentiating from other approaches in the clinic. And should that 2027 data include C-peptide preservation data? And then if I could squeeze one more in just more broadly, as you think about advancing ResPEG into additional indications. You mentioned quite a few in your prepared remarks, Jay Z. How do you think about prioritizing those for which ones might be the first to potentially advance into the clinic? Thanks very much.

Alright. Thanks. Thanks, Sam. So, you know, in the type 1 diabetes, it was very interesting because TrialNet was actually looking for a regulatory T cell targeting approach. And, you know, and it was very exciting because there was a lot of sort of mutual drive for bringing that forward. And then it was also a very competitive process working with them because they have many things that they can choose from. We were very, very excited that they selected Respag to run the study. Now one of the underlying scientific themes is there is a well-known sort of theory about the role of regulatory T cells in this disease and that sort of how thymic antigens end up being, you know, bad for driving the autoreactivity against the islet cells and then a loss of Treg control, you know, really, really exacerbated that. So there was a goal in order to elevate Tregs in these patients in order to slow the progression of the disease and, ideally, you know, overcome it altogether. And so the first step in sort of achieving this long mission is this therapeutic intervention study. And this trial is really run very much in the same way that the first teplizumab studies were run. The big difference is that we are giving a six-month treatment, as opposed to just a short, you know, burst—just a few weeks—as how tefluncimab is dosed. And then the goal is, of course, to really slow down the rate of decline. There will be an opportunity for early data next year, and it is a little early to say the full extent of what that would be, Sam. However, yes, a mixed-meal tolerance test, right, with C-peptides is obviously one of the key endpoints in the study along with HbA1c levels and also insulin usage. And so those are the key activities that are being tracked in the patients. And it is a well-designed study with probably the most highly qualified team of people to do that kind of study in the TrialNet consortium. And then in terms of the other indications, it is still something that we are deciding on, which indications and which ways to go. But I think that we have seen so many examples of data from our own program that would really make some indications quite attractive. I think it is quite clear that this mechanism in both skin diseases and in diseases that have a TH2 drive has quite a lot of potential. And so seeing the results that we saw in patients with comorbid asthma was very exciting. That makes that a very, very interesting indication. And there are a number of allergic indications as well that are also potential. So this is something that we will give more updates on in the future in the coming months.

Yeah. And we just may want to add too, just in terms of the differentiation in type 1 diabetes, you know, Pezil is not an easy drug to give. It is administered as a 14-day course of IV infusion for the up-dosing schedule. And, you know, patients can commonly have cytokine release syndrome and so, you know, you do have to give enough number of other medications an antipyretic, an antihistamine, maybe an antiemetic. And then clinicians have to monitor for lymphopenia, rash, and even elevated liver enzymes. So, you know, in contrast, an outpatient dosing regimen with ResTech where there is not routine monitoring and you do not see cytokine release syndrome, I think also affords a highly differentiated and more favorable safety profile as well as, you know, drug that is administered out as opposed to an IV infusion in an infusion center or even hospital.

Thank you.

Thank you. And our next question will come from Arthur He from H.C. Wainwright. Your line is open.

Hey, Howard and team. Congrats on the progress. Can you guys hear me okay?

Yes. We can.

Oh, okay. Sounds good. So I have two questions. I know you are going to present the extension data from the AA study in April. But could you, if it is allowed, tell us how many patients complete the extension phase? And also, when the patient finishes the extension, do they have a choice to continue on the drug, or does everybody go to the off-treatment period? That is question one. Question two is, could you give us a quick update on the LADY trial? Thanks.

JZ, why do you not take the part about the first question?

Yeah. So really quickly. So as we announced in December, there were 23 patients that were ongoing in the 16-week extension. If you remember, Arthur, we had a waterfall plot, and they were the green dot people—patients—on that chart. So the data update that is coming in April will be when everybody completed the 52-week treatment. So those 23 people as well as anyone that had completed it prior. And then for this trial, all treatment stops for all patients at either week 36 or week 52 for the people that went into the extension. And afterwards, everyone is followed for 24 weeks after. And then for the second question, I will turn it over to you, Howard.

Yeah. Thanks, Arthur. Look, obviously, I cannot comment in detail on, you know, this type of litigation. Trial was scheduled for last year. It was—it's in federal court. So because of the government shutdown last year, it was moved to this year because the courts were shut down. This trial is scheduled for September 8, jury trial in federal court in San Francisco. And we are fully committed to pursuing this. And we, you know, we certainly think we were harmed. And let us see how this plays out in court. Hope that is as much as an answer as I can give you at this point. But thanks for the question.

Awesome. Thanks for taking my questions.

Thank you. Our next question comes from Andy Hsieh from William Blair.

Great. Thanks for taking our questions. Maybe just one on some of the macro developments in the last couple of weeks. Galderma, they kind of talked about increasing confidence in the atopic dermatitis space. So I guess part one, I am curious if that could alter your market sizing guidance that was provided during Morgan, and then also kind of data update from Pfizer with its tri-specific asset in atopic dermatitis. Not a lot of numerical data, but, you know, kind of curious about your take on that. Thanks.

JZ, you want to answer that one?

Sure. Yeah. So maybe I will start off on the Pfizer one, and then, Mary, you can touch on the Galderma update. So briefly covering—you know, Pfizer did present limited data in the press release covering a couple of molecules for multispecific molecules that were inhibiting either IL-4/13 and tislip or 4/13 and IL-33. And they showed some very encouraging placebo-adjusted efficacy data. One of the things that, you know, we—it is a very interesting question because sort of combining known mechanisms into multispecific agents, whether bi- or tri-specific, is one way of achieving a combination kind of strategy. But it is also a way of kind of bringing in all the known mechanisms into one thing. It has a potential to be helpful, but it is also kind of an incremental approach focusing on known and validated agents. We think there is an opportunity with the mechanism like Respag as a Treg targeting mechanism to provide the patient a much more holistic and potentially comprehensive kind of efficacy. Because, really, what a Treg is aiming to do is to fix the underlying pathology of the disease—not take away pathways that are disease drivers per se, but to fix what caused those pathways to be disease-driving in the first place. And that is why we think we have been observing, you know, in atopic dermatitis with ongoing dosing, such a growing level of efficacy, a deep maintenance, and the potential for patients to really do better. It is very interesting. I mean, most medicines you take, they tend to do worse for you over time. But in studies with Respag, we see that patients do better with time. So we think there is a lot of opportunity there. We also are very excited that Respag is much further ahead. Right? So when you think about the programs that are initiating phase 3, Respag is at a very competitive position and it is a novel MOA. And it has the opportunity to provide very differentiated opportunities for patients. Mary, let me turn it over to you for the Galderma question—summary.

Well, thank you. And I want to thank everyone today for joining us and for your continued support. We really greatly appreciate it. And I want to thank our employees who tirelessly work on behalf of patients. And together, we have transformed our scientific hypothesis into real and potentially meaningful therapeutic options for patients. We look forward to initiating our phase 3 studies in atopic dermatitis in June and sharing our 52-week alopecia areata data in April. So stay tuned. Thanks, everybody.

Thank you. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.