Welcome to Rani Therapeutics Fourth Quarter and Full Year 2021 Financial Results and Corporate Update Conference Call. At this time, all participants are in a listen-only mode. Following management's prepared remarks, we'll hold a question-and-answer session. To ensure that we have ample time to adjust everyone's questions during the Q&A session, we'll ask for a limit of one question and one follow-up question per person. As a reminder, this call is being recorded today Tuesday, March 29, 2022. I'd now like to turn the conference over to Laurence Watts, Managing Director at Gilmartin Group. Please go ahead.

Thank you, operator. Joining us on the call today are Chief Executive Officer, Talat Imran; Chief Financial Officer, Svai Sanford; and Chief Scientific Officer, Mir Hashim. During this call, management will make forward-looking statements that are subject to risks and uncertainties related to future events and/or financial performance of the company. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions such as, but not limited to, those discussed in the risk factor section of the company's filings with the Securities and Exchange Commission, including its annual report on Form 10-K and quarterly reports on Form 10-Q, which identify the specific factors that may cause actual results or events to differ materially from those described in these forward-looking statements. These factors may include, without limitation, statements regarding product development and clinical trials, product potential, the regulatory environment, certain business strategies, capital resources, or breaking performance. Actual results and the timing of events could differ materially from those projected in such forward-looking statements. With that, I'll turn the call over to Talat Imran, Chief Executive Officer of Rani. Talat?

Thank you, Laurence. Good afternoon, everyone, and thank you all for joining our fourth quarter and full year 2021 financial results conference call. 2021 proved to be a transformative period for Rani Therapeutics. During the year, the company completed an initial public offering on NASDAQ, expanded its executive leadership, progressed its development pipeline, and made further progress optimizing the RaniPill oral delivery platform. Before I turn to recent events, I would like to start today's call by going over the key milestones we achieved in 2021. Our most notable achievement was the completion of the successful IPO in August, which raised approximately $84 million in gross proceeds. As a result, Rani exited the year in a strong financial position. On a personal note, I was honored to be appointed CEO prior to us going public and to lead Rani Therapeutics through the IPO process. In 2021, Rani's executive team was further strengthened by the appointment of Eric Groen to General Counsel. We also expanded our non-executive team, welcoming Lyn Baranowski, Laureen DeBuono, and Jean-Luc Butel to our Board of Directors, with Lisa Rometty joining our Board in January. Turning to our operations, we have made significant progress in refining and furthering our drug development plans over the past year. Following our positive Phase I study results for Octreotide using our original RaniPill capsule, which were announced in 2020, and which serve as a proof of concept for our injectable to oral delivery platform, we further refined not only the platform itself, but also our near-term clinical development plans for the oral delivery of biologics. As a reminder, the original RaniPill capsule can deliver doses of up to three milligrams of drug per pill. This capacity enables us to pursue a whole host of disease indications, including neuroendocrine tumors or NETs, acromegaly, psoriatic arthritis, growth hormone deficiency, osteoporosis, and hypoparathyroidism. Parathyroid hormone or PTH is administered by daily injections for the treatment of osteoporosis and quickly became a key focus for us and led to the development of our drug candidate RT-102. As such, in November, we completed a GLP 7-day repeat dose oral administration study that evaluated the safety and tolerability of RT-102 in a canine model. The study demonstrated successful delivery of a PTH payload via the RaniPill capsule with a pharmacokinetic profile comparable to the published data for once-daily PTH subcutaneous injection. I'm happy to announce that our second clinical program began last week with the initiation of our Phase I study of RT-102 for osteoporosis. The initiation of this study represents a significant milestone for Rani as our second program to enter the clinic. We intend to initiate another Phase I study with RT-109, our oral human growth hormone program in the second half of the year. Now let me turn to our other major development initiative, the RaniPill HC, a newly designed high-capacity oral biologic delivery device capable of administering 500% plus higher payloads than our current RaniPill capsule. We believe this is a significant breakthrough in drug delivery with the potential to provide expansive opportunities for the company, such that we could potentially pursue a daily dosing option for over 50 additional biologics for internal development or through partnerships. Importantly, we believe this development will not detract from us making progress with our original RaniPill capsule, which forms the core of our current development pipeline. The current RaniPill capsule is optimized for drugs with a daily dose of up to three milligrams. The RaniPill HC can potentially deliver up to 20 mgs. To give you an idea, some of the potential drugs that we could now target with the RaniPill HC include pembrolizumab, intercept, etanercept, trastuzumab, and secukinumab. From these alone, you should be able to tell the potential market opportunity for us with this higher capacity device is significant. As we reported in February of this year, in a preclinical in-vivo study, we successfully delivered an 80-milligram dose of drug in three canine test subjects using the RaniPill HC device placed by a laparotomy. Systemic serum drug concentration was detected and measured over five days. Lastly, before I turn the call over to Mir to cover our preclinical data in more detail, I want to discuss the market research that we released on patient preference for ingesting an oral therapeutic over receiving an injection. We commissioned an independent third-party survey to investigate US patient and physician preference for oral medications versus injections. The survey involves 611 patients aged 18 years or older and presently using an injectable biologic to treat a condition and 201 physicians, mostly endocrinologists and rheumatologists, presently prescribing injectable biologics to their patients. Across all patient groups, genders, ages, conditions treated, and severity of condition, there was a consistently strong preference for switching from injection to pills, even for infrequent injection regimens of up to six months. For example, for Prolia, which is administered as a subcutaneous injection once every six months, 76% of patients surveyed indicated a preference for a daily pill versus a current regimen. For Humira, which is dosed biweekly, the percentage of patients who prefer daily pills was 88%. All groups surveyed indicated a preference for oral over injectable drugs at or exceeding 64%. This demonstrates that there is tremendous latent demand among patients for an oral alternative to many blockbuster biologic drugs. Together with the RaniPill HC, this presents a number of potential opportunities for expansion of Rani's pipeline in the future. In addition to the commissioned surveys, we conducted our own preference and tolerability study involving a mock RaniPill capsule containing potato starch to evaluate the ease with which a RaniPill capsule could be swallowed. Of the 150 individuals that participated, all were able to swallow the mock RaniPill capsule with no reported difficulty. Remember, the RaniPill is an OOO sized pill similar in size to that of an official old pill. Once again, we found that people overwhelmingly favor taking a pill in place of an injection. Thus, the market research confirmed what we believe to be true: people hate needles and patients prefer pills. With that, let me now turn the call over to Mir Hashim to discuss our preclinical and clinical updates in more detail.

Thank you, Talat, and thank you everyone for joining us. Let me provide some updates on two major developments. One focused on our pipeline program, RT-102, and the other on the development of a higher capacity RaniPill device, which we call RaniPill HC. Let me begin with an update on the RT-102 project. RT-102 is a RaniPill capsule containing a formulation of the human Parathyroid Hormone analog PTH 1-34, which is being developed by Rani as an oral osteoanabolic therapy for osteoporosis. With the goal of launching a Phase I human clinical study in early 2022, we initiated a seven-day repeat dose nonclinical GLP study in November of 2021. This study was conducted in awake canines to evaluate the safety and tolerability of RT-102, which was administered daily to these subjects for seven days. The RaniPill capsules were well tolerated in all animals with no clinically adverse observations noted. Specifically, there were no significant gastrointestinal abnormalities associated with the oral administration and dosing of RT-102. Based on these findings, we were able to meet the requirements for initiating a Phase I clinical trial of RT-102. This Phase I study is designed as a single-center open-label trial evaluating the pharmacokinetic, safety, and tolerability of RT-102 in healthy adult women volunteers. Each subject will be administered a single dose of RT-102 over a range of 20 micrograms to 80 micrograms. I'm happy to report that this study was initiated or planned in the third week of March, and we have already successfully dosed the first human subjects. We expect to announce the top-line results of the RT-102 Phase I study in the second half of the year. Now turning to the second major update, Rani has been working on the development of a high-capacity RaniPill or RaniPill HC with the potential to deliver drug payloads of up to 20 milligrams. We are pleased to announce the successful completion of our first preclinical study in the canine model with the RaniPill HC. This preclinical study utilized a RaniPill HC device without an enteric coating or chemical reactance and was inserted directly into the duodenum via laparotomy. The device was actuated by an external pressure source to deliver approximately 18 milligrams of adalimumab to the canines. We achieved successful delivery in each of the three test subjects, which was then followed by the monitoring of systemic serum drug concentrations over a five-day period to obtain a PK curve. We compared the PK levels of the 18 milligrams of adalimumab delivered by the RaniPill HC to PK levels of 2.5 milligrams and 5 milligrams approximately of adalimumab that were delivered previously using the original RaniPill capsules. The data, when normalized for dose and weight unit of PK curve, was proportional to the historical PK curves generated with the lower doses. While we are in the early stages of development of the RaniPill HC, we are excited to expand its reach to additional drug candidates that are currently delivered parentally at higher doses. And by the way, the RaniPill HC shares many similarities with our existing RaniPill capsule. Now I will turn it over to Svai to go over the financial results for the fourth quarter and year-end 2021. Svai?

Thank you, Hashim, and good afternoon, everyone. The press release we issued earlier today provides our financial results in detail, so I will only provide highlights on this call. Operating expenses for the fourth quarter and full year 2021 were $13.4 million and $54.3 million compared to $5.1 million and $17 million for the same period in 2020, respectively. Excluding stock-based compensation, depreciation, and amortization, non-GAAP operating expenses were $10.1 million for the fourth quarter and $31.2 million for the full year 2021. Turning to our balance sheet; cash, cash equivalents, and short-term investments were $117.5 million as of December 31, 2021, which we believe is sufficient to fund our planned operations, at least until the end of 2023. With that, I will turn the call back over to Talat for closing comments. Talat?

Thank you, Svai. In closing, we are very pleased with our progress so far and look forward to maintaining our momentum in 2022. We look forward to sharing the top-line results from our Phase I clinical trial of RT-102 in the second half of the year, and to initiating our third clinical program, RT-109. We also plan to make further progress with the RaniPill HC and are exploring a number of opportunities involving this higher payload system. We have built a world-class leadership team at Rani, and I would like to thank everyone at the company for their efforts this past year and subsequently. I'd also like to thank all of our stakeholders for your continued support of Rani and helping us move closer to our vision of making oral biologics a reality. With that, I will now open the call up for questions. Operator?

Our first question comes from Geoff Meacham with Bank of America. Your line is open. Please, go ahead.

Hey guys. Thanks so much for the question. Just had a few. When you look at the high-capacity pill, are there any additional modifications beyond just the ability to scale up those? I wasn't sure if the device within the pill was changed at all to accommodate. I was just thinking whether you guys would have to go back and maybe repeat any prior safety or tolerability studies. And the second question is, is it fair to say that the HC strategically could be the preferred product going forward? Just given that a lot of approved agents are likely to be a higher dose product. Thank you very much.

Thank you, Jeff. And it's good to hear your voice. Appreciate the questions. I'll try and take them in order. The RaniPill HC shares a number of commonalities with our current generation RaniPill platform. There are obviously some modifications to increase the dose by 500%. Ultimately, it'll be packaged into the same capsule. The balloon is similar or the same, I should say and from the perspective of the patient, the size of the capsule itself doesn't change at all. Having said that, given that there is a different mechanism in this device, we expect that we will be doing at least some safety and tolerability work, where there may be some ability to use what we've done already in the biocompatibility space in areas like that. In terms of where this goes relative to the current RaniPill platform, you're absolutely correct that this opens up a number of new opportunities and where a lot of the growth is in the biopharma space. So looking at therapeutic monoclonal antibodies in the immunology space or oncology, those are likely because of their dosing to go into a RaniPill HC. Having said that, the current RaniPill generation is really ideally suited for lower dose drugs like our PTA for osteoporosis. So there's no plan to move that over to the HC, and we're fully committed to moving that forward and turning it into a commercial product once we get through the clinical cases.

Okay, great. Thank you very much.

Appreciate it. Thank you.

Thank you. And our next question comes from the line of Annabel Samimy with Stiefel. Your line is open. Please go ahead.

Hi, thanks for taking my question. So you kind of touched on this before, but I was curious with the HC, are there any programs of your current programs that you think would be better suited to the high capacity? I guess what you call, to formulation or mechanism, like for example, maybe human growth hormone, where it would be administered to kids and maybe they could deal with a smaller pill size or something like that. And are there any therapies that you have access to now, which obviously you do that would take priority over some of the current programs that you had listed initially with the RaniPill? And then as a follow-up there's, I guess you kind of also touched on this, but for the master file that you're going to have for the RaniPill, do you have to start a whole new master file for the high capacity? Thanks.

Yeah, sure. Thank you, Annabel. So I think you touched on an important point here around HC or for any pediatric application of the RaniPill getting to a smaller size would let you get to patients who are under 10 years of age. So that is potentially an application where you could move to the RaniPill HC, but that would require further development because the current version of the RaniPill HC is the same size as the current RaniPill. In terms of new programs, well, just continuing on that before I move on to new programs, our adalimumab biosimilar would fit in our current RaniPill, but there are certain applications, higher dose applications where it makes sense to put that into the HC. But primarily we're looking at new programs. So that's a good segue to your second question. We don't have any to announce right now, and we're not making any changes to our pipeline as of yet, but I think what you're intimating is that yes, because of the RaniPill HC, we're going to be adding some additional programs and perhaps later in the year, we'll give some guidance on how we'll strategically prioritize those. We do want to show clinical validation of the RaniPill HC as soon as we can; right? There's the development that'll go on this year, but if we can move into the clinic, I think it's good for us and good for everybody. As far as the master file is concerned, you're right. I did kind of speak to this. I think that realistically, we will have to do some repeat dose safety and tolerability with the RaniPill HC; where they will share commonality is it's many of the components are identical, so biocompatibility and many of the other things that are going to go into verification and validation of these platforms will be able to share.

Okay, great. But is it going to be a whole new file though?

No. So there'll be one master file. You can have chapters in it to cover different embodiments and also for those will have to be there for specific drugs potentially as well.

Okay, great. Thank you.

So just one file. Yeah.

Thank you. And our next question comes from the line of Michelle Gilson with Canaccord Genuity. Your line is open. Please, go ahead.

Hi, thank you for taking my question. I have a question about RT-102 and another regarding the high-capacity pill program. For RT-102, you have recently started the Phase I study with healthy volunteers. Could you provide more details about the trial design and any additional parameters you plan to evaluate in that study? Specifically, beyond the various doses, are there other experimental aspects of the pill? Additionally, could you clarify what would be considered a successful outcome for that study? How can we interpret the PK profile? It has been challenging to translate PK data from other PTH programs, particularly those using alternative dosing methods that are not subcutaneous, into relevant biomarker or BMD outcomes. Can you explain why we should have confidence in the PK profile being presented for RT-102?

Sure. Should I answer that and then we'll go to the HC question.

Yeah, that sounds good.

Hi Michelle, thank you for your question. I'm happy to provide some details about our RT-102 Phase I study. This is a single-dose study involving healthy volunteers. We are administering a 20-microgram dose, which is the commercial dose for Forteo, as well as an 80-microgram dose, which is the clinically administered dose. We will also include an intermediate dose. You are right that monitoring biomarkers is crucial, especially considering that this area has seen several failures with both oral formulations and the patch recently. The key difference with Rani's approach is that it involves an injection. While it is a jejunum injection, it is still classified as an injection. Our preclinical data suggests that the peak and trough levels align closely with what is expected from a subcutaneous injection. You are correct in noting that the pharmacodynamics aspect is significant here; we don’t have updates to share yet, but we anticipate having more information later this year when we release the Phase I results. This should support the expectation that the outcomes will be comparable to subcutaneous delivery of Teriparatide.

Okay, thank you. And in terms of, I guess for the RaniPill HC, the first initial proof of concept was done with the placement of the RaniPill via laparotomy into the jejunum. Should we expect, I guess, the next steps to be very similar to what you did for the original RaniPill or what, I guess, what are the next steps for evaluating the HC pill? And at what point do you get comfortable bringing it to the clinic? I know you're looking forward to bringing this into people.

Well, thank you for that question. And I'm glad that folks are excited enough that two months or a month after announcing it, everyone's asking me when are we getting it into the clinic? I think it is an important development for the company. You're correct. We did a placement via laparotomy, and it was externally powered that was in order to visualize the delivery. We did this with the first RaniPill platform as well. And the next step is to take a fully packaged product and put it in via laparotomy again, watch it unfold, watch it deliver, and hopefully get good reliable results in terms of PK. From there, the final step is in oral administration in canines. We'll get through those knock on wood, hopefully this year, that's the plan. And then in parallel, we're doing candidate selection both for our pipeline and then talking to some potential partners, with the goal of getting that into the clinic as soon as reasonably possible. I think development is always hard to predict down to the day, or even perhaps the month, but a lot of the heavy lifting has been completed, which is why we were comfortable announcing it. Getting a mechanism that could deliver 500% plus or more, that was the really hard part and we've been able to show that already.

Right. Well, thank you for taking my question and congrats on your first earnings call as a public company.

Thank you so much, Michelle.

Thank you. And our next question comes from the line of Brandon Folkes with Cantor Fitzgerald. Your line is open, please. Go ahead.

Hi, thanks for taking my questions and congratulations on all the success. So maybe just following along a similar line, as we look at longer term, is the RaniPill HC something you expect to pursue in parallel with the original RaniPill? And I mean that from the aspect of understanding what you have communicated today that you still committed to the second Phase I study getting RT-102 to market. When we think about new indications going forward, should we think about those coming through in both the RaniPill and the RaniPill HC, or just given the potential multi-contemplate maybe relocating resources to the RaniPill HC. And then I'll just ask my second question, because it probably is answered in the same. Can you just talk about the study contemplated in the statement of the cash runway through the end of 2023? Just given that's a pretty solid cash runway, any potential to pull programs forward there, especially in the HC programs or is sort of development still progressing where that's really the limiting factor versus cash? Thank you.

Sure. So in short, I think you will see developments with both platforms in parallel. We still receive considerable interest from pharma companies that want to use our current RaniPill generation for some really interesting next-generation applications within the biotech space. So there are places I won't speak to right now that we could go that are really ideally suited. The other thing that we're doing with the current generation RaniPill platform is a sustained release version, and that would take certain peptides and make them deliver over several days instead of an immediate release. That opens up our RT-110 PTH for hyperparathyroidism for other indications as well. There are very interesting applications that can be used there. Having said that, of course, the RaniPill HC opens up virtually all, many, I'll say of the monoclonal antibodies that are currently on the market, virtually all in the inflammatory space and many in areas like oncology or rare disease. So clearly there are a number of opportunities for pickup. Now, where does that fit in terms of our budget? Our budget contemplated running two Phase I, a repeat dose IDE, and two Phase I in 2023. So two this year, the repeat dose study into next year. If we're going to add to that, we will obviously need to look at bringing on additional resources or doing that in partnership. But nothing to report right now. I think we'll figure out where that program is going to, the RaniPill HC platform, I should say, is going over the course of this year. And when we're ready to make some additions or alterations or move things up, we'll definitely let you know.

Great. Thank you very much.

Our next question comes from the line of Bret from BTIG. Your line is open, please go ahead.

Thank you for the question and congratulations on the progress made over the past months and years. I have a strategic question regarding the portfolio, specifically about the RaniPill and its partnership with HC. How do you envision balancing internal capabilities versus partnerships, and how are you evaluating potential strategic options internally? Could you provide any insights into the partnership prospects for both the HC programs and the regular RaniPill?

Sure. Regarding our current pipeline and its expansion, we may realistically see a few minor additions, possibly one or two programs on the existing RaniPill platform. With respect to HC, we will certainly introduce an additional program as we progress through our oral preclinical testing. There is potential for these to be partnered programs. We have received interest in using the platform for both lifecycle management products and new compounds. However, we need to be selective about our pursuits. While the RaniPill platform presents significant opportunities for expansion due to its capabilities, we must carefully consider clinical trial burdens, trial costs, potential revenues from specific products, the patient burden associated with current injectable regimens, and the potential for improved access with an oral formulation. These factors will guide our decision-making, and we anticipate providing more updates later this year.

Okay, great. And just one other quick follow-up, maybe you mentioned maybe I missed it, in terms of timing with the master file, a progress or let's call a result from the master file, is there any particular timing that you've indicated there?

No, we haven't. We're on track with our plan. So we have to run a pretty significant GLP or I should say IDE enabling GLP study and we're gearing up for that. That takes a lot of work to get that ready to go. And it's a two-month study and then from there, we'll submit the IDE and get into actually running the study itself and having that data go into a master file. We may have an update sooner rather than later; we'll share that when it happens.

Terrific. Thanks. Congrats again.

Thank you so much.

Thank you. And I'm showing no further questions at this time, and I would like to turn the conference back over to Talat for any further remarks.

Well, thank you, operator. This concludes our fourth quarter and full year 2021 conference call. Thank you again, everyone for joining us this afternoon.

This concludes today's conference call. Thank you for participating. You may now disconnect everyone. Have a great day.