Good morning, everyone, and welcome to Veru Inc.'s Investors Conference Call. I will now hand it over to Mr. Sam Fisch, Veru Inc.'s Executive Director of Investor Relations and Corporate Communications. Please proceed.

The statements made on this conference call may be forward-looking statements. Forward-looking statements may include, but are not necessarily limited to, statements of the company's plans, objectives, expectations or intentions regarding its business, operations, regulatory interactions, finances, and development and product portfolio. Such forward-looking statements are subject to known and unknown risks and uncertainties, and our actual results may differ significantly from those projected, suggested or included in any forward-looking statements. Risks that may cause actual results or developments to differ materially are contained in our 10-Q and 10-K SEC filings as well as in our press releases from time to time. I would now like to turn the conference call over to Dr. Mitchell Steiner, Veru Inc.'s Chairman, CEO, and President.

Good morning. Joining me on this morning's call are Dr. Gary Barnette, Chief Scientific Officer; Michele Greco, Chief Financial Officer and Chief Administrative Officer; Michael Purvis, General Counsel and Executive Vice President of Corporate Strategy; and Sam Fisch, Executive Director of Investor Relations and Corporate Communications. Thank you for participating in our Q1 fiscal year 2025 earnings call. Veru has transitioned into a late clinical-stage biopharmaceutical company dedicated to creating therapies for cardiometabolic and inflammatory diseases. Our drug development program includes two clinical-stage new chemical entities, enobosarm and sabizabulin. Enobosarm is an oral selective androgen receptor modulator designed to enhance GLP-1 receptor agonist-induced weight reduction while preserving lean mass and muscle function, particularly in older patients dealing with overweight and obesity. Sabizabulin is an oral microtubule disruptor aimed at serving as a broad anti-inflammatory to slow or reverse atherosclerotic cardiovascular disease. On December 30, 2024, we sold our FDA-approved commercial product, the FC2 female condom. Now, let’s review our obesity program. Obesity is classified by the FDA as an illness associated with excessive body fat. Our medical goal is to reduce body fat through weight loss drugs in order to lessen the morbidity and mortality linked to obesity. GLP-1 receptor agonists have demonstrated significant weight loss in overweight and obese patients but do so in a way that is not tissue-selective, resulting in the loss of both fat and lean mass, including muscle. Data indicates that 20% to 50% of total weight loss in these patients arises from lean mass reduction. According to Medicare, 22% of the U.S. population is over 60 years old, totaling around 70 million individuals. The CDC reports that 41.5% of older adults are obese and could benefit from weight loss medications. Approximately 34.4% of U.S. patients over 60 with obesity suffer from sarcopenic obesity, which is characterized by having both obesity and low muscle mass—these patients face an increased risk of critical muscle mass decline when using currently approved GLP-1 receptor agonists. Therefore, we recognize the pressing demand for a new generation of obesity treatments like enobosarm that can minimize muscle loss while promoting fat reduction among older patients undergoing GLP-1 receptor agonist therapy. Enobosarm functions as a next-generation drug that enhances the tissue selectivity of weight loss via GLP-1 receptor agonists. Let’s discuss the update on our Phase 2b QUALITY clinical study. On January 27, 2025, we released positive top-line results from the Phase 2b QUALITY clinical study, a multicenter, double-blind, placebo-controlled randomized dose-finding trial aimed at assessing the safety and efficacy of enobosarm 3 milligrams, enobosarm 6 milligrams, or placebo, as a means to enhance fat loss and prevent muscle loss in sarcopenic obese patients over 60 receiving semaglutide (Wegovy). The study took place across 14 clinical sites in the U.S. This Phase 2b QUALITY study is the first to examine a muscle-preserving drug candidate on body composition in older patients with obesity or those who are overweight and receiving a GLP-1 receptor agonist. The primary efficacy endpoint was met with significant clinical benefits in preserving lean body mass for all patients receiving enobosarm plus semaglutide compared to those receiving only placebo and semaglutide at 16 weeks. We observed a 71% relative reduction in lean mass loss, achieving a p-value of 0.002. The enobosarm 3-milligram plus semaglutide was found to be the most effective dose, showing a relative reduction of over 99% in lean mass loss, with a p-value less than 0.001. The enobosarm 6-milligram plus semaglutide did not demonstrate substantial improvement over the 3-milligram dose. In terms of secondary endpoints, the treatment group receiving enobosarm and semaglutide showed a greater dose-dependent loss of fat mass compared to the placebo plus semaglutide, with the 6-milligram dose yielding a 46% greater relative fat loss than the placebo group at 16 weeks, reflected with a p-value of 0.014. Although enobosarm plus semaglutide effectively preserved lean mass, the additional fat loss from enobosarm treatment compensated for the retained lean mass, resulting in similar overall weight loss as seen with semaglutide. Hence, the weight loss profile shifted towards a more selective fat loss with enobosarm treatment. In the placebo semaglutide group, 32% of the total weight lost was lean mass, whereas in the enobosarm plus semaglutide group, only 9.4% of the total weight loss was attributed to lean mass, contrasting with a 90.6% attributed to fat loss. Specifically, for the enobosarm 3-milligram plus semaglutide group, lean mass loss was at 0.9% versus 99.1% fat loss. Therefore, the combination of enobosarm and semaglutide resulted in favorable changes in body composition, leading to a more selective and greater fat loss compared to those receiving placebo plus semaglutide. We assessed physical function via the Stair Climb Test, an everyday activity that gauges muscular strength, balance, and agility, with declines in performance indicating increased risk for mortality, mobility issues, falls, and fractures in older individuals. Reference data shows stair climbing power declines about 1.38% yearly due to aging. In our study, 42.6% of the placebo semaglutide patients experienced at least a 10% decline in stair climb power at 16 weeks—marking a significant finding showing the accelerated lean mass loss risk in older patients receiving semaglutide. The enobosarm plus semaglutide group demonstrated a significant and clinically meaningful 54.4% relative reduction in subjects who faced at least a 10% decline in stair climbing power compared to the placebo group, with a p-value of 0.0049. In the enobosarm 3-milligram plus semaglutide group, there was a 62.4% reduction in such patients compared to the placebo group, with a p-value of 0.0066. The enobosarm 6-milligram plus semaglutide group showed a 46.2% reduction, with a p-value of 0.055. Therefore, enobosarm treatment preserved lean muscle mass and reduced the proportion of patients exhibiting clinically significant declines in stair climbing ability compared to those receiving semaglutide alone. Enobosarm signifies the next generation of drugs that enhances GLP-1 receptor agonist therapy, allowing for improved body composition and quality weight loss. We are thrilled with the top-line results, indicating that it is plausible to maintain lean mass and improve physical function while achieving significant fat loss, leading to weight loss comparable to semaglutide after 16 weeks. We anticipate that extended treatment with enobosarm and semaglutide will foster even greater quality weight reduction than semaglutide alone. Regarding safety, the Phase 2b QUALITY study safety data remains blinded as the extension study is ongoing, with complete safety data to be revealed post-completion. However, the aggregate safety data to date have not displayed significant differences from previous enobosarm studies nor expectations related to GLP-1 receptor agonists. The independent data monitoring committee convened on February 10, 2025, to review the unblinded safety data and recommended continuing with the study as it is currently structured. Following the efficacy portion of the Phase 2b study, participants transitioned into the Phase 2b extension trial, which involves stopping semaglutide treatment but continuing with placebo, enobosarm 3 milligrams, and enobosarm 6 milligrams in a blinded manner for 12 weeks. This extension trial will investigate if enobosarm alone can sustain muscle and prevent fat regain that often occurs after the cessation of GLP-1 receptor agonist therapy. We expect to announce top-line results from this blinded Phase 2b extension clinical study in the second quarter of 2025. We intend to share the comprehensive clinical efficacy and safety data set for the Phase 2b study at future scientific conferences and publications once the extension study has concluded. With the positive results from the Phase 2b QUALITY study, we are preparing to request an end of Phase 2b meeting with the FDA. We've already discussed our regulatory strategy with the FDA, focusing on advancing body composition therapies, and have received guidance on Phase III trial design. Following the successful outcomes of the Phase 2b study, we plan to run a similar study in Phase III, expected to last 52 weeks, enabling us to evaluate the long-term benefits of enobosarm on body composition for enhanced fat loss and weight reduction. Additionally, we are developing a novel patentable modified release formulation of enobosarm, with pharmacokinetic profile and manufacturing processes anticipated to be subject to future patents. The product formulation is currently undergoing animal trials and is expected to be ready for Phase I bioavailability clinical tests in the first half of 2025. Our goal is to utilize this modified release oral form during the Phase III clinical studies and for eventual commercialization. We are also excited about our atherosclerosis inflammation program. The favorable results from the Phase 2b QUALITY study, which evaluated enobosarm as a cardiometabolic agent with the potential to preserve muscle while enhancing fat loss in patients receiving GLP-1 receptor agonist therapy, have led us to evolve our developmental strategy for sabizabulin. We are investigating its clinical application as an oral broad anti-inflammatory treatment for inflammation related to atherosclerotic cardiovascular disease. We believe there is strong scientific rationale to explore sabizabulin as a therapeutic agent for inflammatory complications associated with atherosclerotic cardiovascular conditions. Atherosclerotic coronary artery disease remains a leading global mortality factor, with inflammation and high cholesterol contributing significantly. The process driving coronary artery disease is largely inflammation triggered by atheromatous plaques containing cholesterol in arterial walls. Despite aggressive cholesterol management strategies, extensive inflammation risk remains untreated, highlighting the need for combined approaches utilizing lipid-lowering drugs with inflammation-reducing therapies to lessen coronary artery disease risks. Colchicine, a historical drug that hinders microtubule polymerization, has exhibited broad anti-inflammatory effects. Recent trials indicated that low-dose Colchicine could diminish cardiovascular adverse events significantly. However, Colchicine also faces serious safety issues that limit its widespread utilization due to numerous drug interactions, especially with statins. In contrast, sabizabulin, as a new small molecule entity, selectively targets the Colchicine binding site on β-tubulin, inhibiting microtubule polymerization while effectively reducing key inflammatory mediators influencing coronary artery disease progression. Unlike Colchicine, sabizabulin presents stable pharmacokinetics and a diminished risk of drug interactions, offering potential safety as a complementary treatment with statins for managing inflammation and slowing atherosclerotic cardiovascular disease's progression. Preclinical evidence from various inflammatory studies shows sabizabulin effectively suppresses numerous tested cytokines and chemokines. In previous Phase II and III COVID-19 studies, sabizabulin demonstrated its broad anti-inflammatory capability. With a safety database comprising 266 patients from earlier sabizabulin trials, our pursuit of this significant cardiometabolic opportunity stems from the pressing need to address inflammation related to atherosclerotic cardiovascular disease, the expansive global market potential, our established safety and efficacy database, and our strong intellectual property position. Furthermore, we plan a small Phase II exploratory proof-of-concept study centered on assessing coronary atherosclerosis progression using coronary CT angiography imaging to measure primary endpoints like coronary plaque volume and composition. We are proceeding with this Phase II study in partnership with the Colorado Prevention Center and the Lundquist Institute. A pre-IND meeting with the FDA occurred on December 26, 2024, focused on using sabizabulin to manage atherosclerotic disease progression in coronary artery disease patients. The FDA acknowledged the existing unmet medical need and agreed with our proposed small Phase II study's general design. They also requested we conduct chronic nonclinical toxicology studies to support sabizabulin's long-term use for this indication. Completion of these studies and submission of a new IND for our proposed application is anticipated in the first half of 2026. Veru currently possesses adequate drug substance for the proposed Phase II clinical trial. Lastly, regarding our FC2 female condom sale: on December 30, 2024, we divested our FC2 female condom business to an affiliate of Riva Ridge Capital Management LP for $18 million, subject to adjustments as per the purchase agreement, which Michele Greco will elaborate on shortly. This sale allows Veru to focus solely on biopharmaceuticals and allocate additional non-dilutive resources toward developing and executing our promising late-stage clinical pipeline. I will now hand the call over to Michele Greco to discuss the financial highlights.

Thank you, Dr. Steiner. As Dr. Steiner indicated, on December 30, 2024, Veru sold the FC2 female condom business to Clear Future Inc. The purchase price was $18 million in cash, subject to adjustment as set forth in the purchase agreement for the transaction. Net proceeds from the sale of the FC2 female condom business were approximately $16.4 million after selling costs and other purchase price adjustments, but before a change of control payment of $4.2 million owed to SWK Holdings, LLC pursuant to a residual royalty agreement for a 2018 financing transaction. The loss on the sale of the FC2 female condom business is approximately $4.2 million, the difference between the estimated net proceeds of $16.4 million and the total carrying value of the FC2 business of $20.6 million. On December 30, 2024, the carrying value of the FC2 female condom business was comprised primarily of deferred income tax assets of $12.3 million, accounts receivable of $4.6 million, and inventory of $3.4 million, partially offset by accrued expenses and other current liabilities of $1.5 million. Liabilities associated with the residual royalty agreement, which totaled $9.9 million at September 30, 2024, were extinguished. The sale of the FC2 female condom business represents a change in strategy, allowing the company to focus all of its efforts exclusively on drug development and also affects how we present our operations and financial results. In our financial statements, all direct revenues, costs, and expenses related to the FC2 female condom business are classified within the loss from discontinued operations net of tax in the statements of operations. Let's review the results for the three months ended December 31, 2024. Research and development costs increased to $5.7 million from $1.7 million in the prior quarter. The increase is due to $4.3 million in expenses related to the company's enobosarm Phase 2b QUALITY clinical study for higher quality weight loss. Selling, general and administrative expenses were $5.2 million compared to $6.7 million in the prior quarter. The decrease is primarily due to a decrease in share-based compensation and a decrease in headcount from 2023 to 2022. We recognized a gain on the sale of AntiFE assets of $695,000 compared to a gain of $918,000 in the prior quarter, which is based on nonrefundable consideration received related to promissory notes due to Veru. In conjunction with the sale of the FC2 female condom business, we recorded a gain on extinguishment of debt of $8.6 million related to the termination of the residual royalty agreement. This represents the difference between the change of control payment of $4.2 million and the net carrying amount of the extinguished debt of $12.8 million, which included an embedded derivative for the change of control provision at fair value of $4.7 million. The bottom line result for continuing operations was a net loss of $1.8 million or $0.01 per diluted common share compared to a net loss of $7.7 million or $0.08 per diluted common share in the prior year's quarter. Net loss from discontinued operations net of taxes related to the FC2 business was $7.1 million or $0.05 per diluted common share, including the $4.2 million loss on the sale of the FC2 business compared to a net loss of $609,000 or $0.01 per diluted common share in the prior quarter. The increase in the net loss from discontinued operations of $6.5 million is due to the loss on the sale of the FC2 female condom business and the increase in the loss from the change in fair value of derivative liabilities of $3.1 million, partially offset by an increase in gross profit of $400,000 and a decrease in selling, general and administrative expenses of $500,000. Now looking at the balance sheet. As of December 31, 2024, our cash equivalents and restricted cash balance was $26.6 million compared to $24.9 million as of September 30, 2024. At December 31, 2024, there was $354,000 of restricted cash related to the sale of the FC2 female condom business. Our net working capital was $22 million on December 31, 2024, compared to $23.4 million on September 30, 2024. The company is not profitable and has negative cash flow from operations. We will need additional capital to support our drug development candidates. Based upon the company's current operating plan, our cash as of the issuance date of these financial statements is not sufficient for the company to fund operations for the next 15 months. However, we currently have sufficient capital to take the company to the end of the calendar year, which is well beyond the data readout for enobosarm Phase 2b QUALITY extension study. During the three months ended December 31, 2024, we used cash of $11.3 million for operating activities compared with $6 million used for operating activities in the prior period. We generated cash from investing activities of $17.2 million for the three months ended December 31, 2024, while there was none generated in the prior period. The cash generated relates to proceeds from the sale of the FC2 female condom business of $16.2 million, proceeds of $700,000 from the sale of the AntiFE assets and proceeds of $400,000 from the sale of some securities. We used cash in financing activities for the three months ended December 31, 2024, of $4.2 million related to the change of control payment to SWK pursuant to the residual royalty agreement, which terminated in conjunction with the sale of the FC2 female condom business. In the prior period, we generated $37 million from financing activities. On December 18, 2023, we completed an underwritten public offering of our common stock, which included the exercise in full of the underwriter's option to purchase additional shares. Net proceeds to the company from this offering were approximately $35.2 million after deducting underwriting discounts and commissions and costs incurred by the company. Now I'd like to turn the call back to Dr. Steiner.

Thank you, Michele. So we've gone over the company clinical progress and financial highlights. With that, I'll now open the call to questions. Operator?

Our first question today will come from William Wood of B. Riley.

And obviously, congratulations on the very nice quarter and the results. I guess maybe first off, if I could, for the extension trial, I'm just kind of curious what the rollover of patients from the induction to the maintenance portion is. And maybe if you could provide any color on why patients may be discontinuing, if so?

So I'm going to ask Dr. Gary Barnette, our Chief Scientific Officer, to answer the question basically asking for the dropout rate or who didn't go on to the extension study. And then he'll answer that for you. And he'll tell you the number one reason why they dropped out.

As Mitch has said previously, the dropout rate in the study is about 13%, and it continues to be that. So about 13% of the randomized subjects will not reach the extension, etc. The most common reason for dropping out of the study or discontinuing the study is GI side effects, which, as we all know, are associated with GLP-1 RAs themselves. So it's relatively expected what we're seeing.

And I assume the potential difference between placebo versus treatment isn't disclosed yet, and we'll get that information more at the end.

That is correct. That will be in the final analysis of the study, especially the safety data right now remains blinded.

And then one quick last one. You're now saying second quarter for the maintenance readout. I'm just curious, I believe you were saying sort of more April, maybe even early May. Has this been now pushed out a little bit more? Or relatively no changes here?

Relatively no changes. We're guiding in the second quarter, but nothing has changed. I mean, 12 weeks to 12 weeks, we know when the last patient went out in December, we reported exactly as we've told you we're going to do for the Phase 2b QUALITY. And the 12 weeks to 12 weeks can’t shorten that and can't make that longer. So the time span that we need after the 12 weeks when the last patient comes out of the study is just literally scrubbing the data and getting the tables, listings, and figures and that kind of stuff.

Our next question today will come from Gary Nachman of Raymond James.

This is Denis Reznik on for Gary Nachman. Just a couple of questions from us. First, talk a little bit more about your thoughts going into the extension trial data in the second quarter. What are you hoping to show? And what is the bar for success, particularly on the weight regain following the GLP-1 discontinuation? Can you remind us what your assumptions are for the placebo arm? And then what are your expectations for the enobosarm arm? And then I've got a follow-up.

So the way to think of the maintenance study is, no one has actually said it a different way. It's an exploratory extension where we're trying to show that enobosarm has the ability to hold on to muscle. The working hypothesis is that if you hold on to muscle, you should not see the rebound weight gain, which is fat because remember, the muscle is not the issue, the muscle is depleted. So it's all about fat. The regain that patients get is all fat. So the way to think of the extension for just 12 weeks is not the weight as much as it's fat because fat tracks weight. So it's purely an adiposity play. So the enobosarm holds muscle, so you have more muscle in that 12-week period of time, so you can burn more fat. And enobosarm itself, as you saw, the 6-milligram group had a 46% further reduction in fat compared to semaglutide alone. So it's a fat burner. What we want to show, and this is what people are afraid of, is the rebound weight gain, which is all fat. So we're focusing most of our thinking around, can we stop that rebound fat regain? And maybe even show more fat loss because the enobosarm burns fat as it goes forward. I'm going to have Gary Barnette, our Chief Scientific Officer, add a few comments to that.

So as you know, when you take away the GLP-1 appetite returns, and we've seen that in the studies with the GLP-1, so we do expect weight gain, and we specifically expect fat gain in the placebo group. And it's going to be interesting to see exactly how enobosarm can minimize that fat regain while maintaining the muscles or the lean mass in this case. So that's what we expect to see. Obviously, the data will bear out exactly, and we're looking forward to that result coming in the second quarter.

So we can blunt the fat and potentially blunt the weight regain. But if you focus on fat and hold muscles constant, that's what you're gaining weight with the fat. So I think the focus is on fat because we're using body composition as our endpoint.

And then just another couple of quick follow-ups. For the safety monitoring committee that met earlier this week, can you talk specifically about what kind of patient safety data they looked at, how far out it went into? And then now that you just had a little bit more time with the 16-week data, are you finding anything notable within the patient sites or the patient background characteristics that is abnormal that should be called out?

So I'll answer the second question, and then I'll have Gary answer the first question on what kinds of data the independent data monitoring committee saw. But in terms of your question, remember, we only got top line data, so there's not much additional stuff to talk about. The baseline characteristics with group characteristics are not available. As for the top line data, we're going to get the full data set, the individual data set when the study is unblinded. At that point, we can go through and look and see. It's not so much what's abnormal and what's normal. I mean, big questions for me is going to be which groups did the best? Which groups did the worst? How do you think about that as you go forward with your Phase III program? What additional information can you gather about gender and things of that sort? I think we're going to get a lot more information; we just don't have it right now. But for top line data, because you can think of it as an interim look and then the study continues, we've got a very set data set if that makes sense. So there's not much more to say at this point, except that we're extremely excited about the outcome because it answered the questions we wanted to answer. Enobosarm in five other studies is a 3-milligram dose, particularly because that's what bridge says to this study. We never studied above 3 milligrams in muscle studies. We've done it in multiple ascending dose studies. And 3 milligrams was our bridge. It worked every time. And guess what? It worked again. So it's unambiguous. We definitely can improve and stop the loss of lean mass. What was also exciting is also confirmed the ability to burn fat in a patient population on a GLP-1. So that was exciting. And then third, we were able to keep the lean mass and get rid of more fat to the point that at the 3 milligrams, 99% of the total weight you lost was fat and less than 1% lean mass, and you still had the same weight loss at 16 weeks. Finally, we showed that physical function matters in these patients and that we were able to show there's a problem and that 42.6% of patients on semaglutide alone at 16 weeks had greater than a 10% decline in stair climb, which is like 8 to 10 years of aging related loss of stair climb. So to me, that's a home run. And that really helps us think very positively about our program going forward because it's better to fix a problem than to try to have a better HbA1c or better insulin resistance. We expect to see all of that. But better meaning that GLP-1 does a great job with that. So you have to make it better than a GLP-1, whereas the GLP-1 does affect function in a negative way, we make it better. But in terms of the data for the IDMC, Gary, what does the IDMC see?

They see individual patient data, individual safety data all the way down again to the patient level. They see it broken out within the traditional tables, and they also see the dose or the randomization scheme. The data that this particular IDMC saw was up to a cutoff of December 20, 2024, which included all subjects who passed through or completed the day 112 visit and then some additional data in the extension was included in this review. So they review down to the individual patients with the patient demographics and background and their medical history, including their treatment assignments.

The next question will come from Dennis Ding of Jefferies.

This is Anthea on for Dennis. Just a couple of questions from us. On enobosarm, given the oral formulation that you're working on, is there a potential for it to be combined with oral GLP-1s as a fixed-dose combo? I'm curious if you've looked into that and if you could pursue a partnership on that. And then on sabizabulin, Colchicine, I believe, works through hsCRP reduction. So can you just remind us what percent reduction they get and what sabizabulin does? And given your current cash position, your confidence that the Phase II would be feasible?

So I have a clarification on your second question. So what did you say Colchicine's mechanism was?

hsCRP reduction, C-reactive protein.

That's the sensitive CRP. CRP is a nonspecific inflammatory protein resulting from broad anti-inflammatory activity. Regarding the oral formulation, our expectation is based on enobosarm, which is a very effective oral product with high bioavailability. We are indeed developing a new oral formulation for modified release, which can be easily combined with an oral GLP-1. This has come up in our discussions, as many believe a fixed combination dose is the most sensible approach when considering our ultimate goals. GLP-1 induces a hypocaloric state, prompting the body to lose fat and muscle non-selectively. Enobosarm helps by directing the body to utilize calories from fat while preserving muscle during this low-calorie state, enhancing the effectiveness of GLP-1. Therefore, incorporating enobosarm alongside GLP-1 is crucial, representing a new generation obesity treatment. We are focused on an oral approach, while our competitors typically use IV or Sub-Q methods. The only other oral option previously pursued is no longer active. Demonstrating improvements in physical function has been challenging for competitors, yet we have consistently shown positive results in our studies. A fixed combination could enhance GLP-1's tissue selectivity and functional benefits, making it very appealing. Regarding sabizabulin and Colchicine, our preclinical assays indicate that while Colchicine serves as a positive control, sabizabulin operates as a different molecular type, avoiding peak glycoprotein and CYP3A4 interactions, which are critical in drug-drug interactions. Colchicine has a narrow therapeutic index, raising toxicity risks with drug interactions. That's why it hasn't seen widespread adoption. High-sensitive CRP is a relevant measure in patients, and sabizabulin should exhibit similar effects since we’ve observed statistically significant reductions in relevant cytokines both in vivo and in vitro. We focus on cytokines that elevate C-reactive protein levels. Due to the absence of drug-drug interactions with sabizabulin, there is increased interest in using it for patients with atherosclerotic disease while effectively lowering LDL. However, even with LDL suppression, residual risks for heart disease persist, mostly driven by inflammation; this was the rationale behind Colchicine's approval. A major challenge has been combining Colchicine with lipid-lowering drugs due to potential interactions with statins. Sabizabulin has a similar inflammatory mechanism without those interaction risks, appealing as a safer option. As a urologist, this situation reminds me of the development of abiraterone and ketoconazole, where ketoconazole had side effects that abiraterone improved upon. It’s acceptable to introduce a drug that’s not the first in class but offers a unique safety profile and oral administration, presenting a high probability of success regarding efficacy. We are particularly excited about the potential of a Phase II study involving plaque measurements from CT coronary angiography for advancing our progress. Concerning our financial situation, as mentioned by Michele, we have sufficient cash to sustain operations through the end of December.

If I could ask a follow-up on that. Is there a numerical hsCRP reduction that's been measured for sabizabulin?

No, no, no. We've not taken patients with coronary artery disease and treated patients for hsCRP.

And if I could also ask, how are you thinking about IL-6 and their 70% to 90% hsCRP reduction profile in ASCVD?

So IL-6, as you know, is not oral, right? It was injectable. Our expectation is that IL-6 is one of the many cytokines that's responsible for the inflammation related to coronary artery disease. This reminds us of the same battle we had with COVID: IL-6 versus sabizabulin. Sabizabulin did a much better job. We had a reduction of 50%, and these other agents were more like 5%. I do think that inflammation is not one cytokine. And if you have a pan-cytokine approach, which is what Colchicine does and what sabizabulin does, that should be much more effective than knocking out a single cytokine in this particular disease.

Our next question today will come from Leland Gershell of Oppenheimer.

Mitch, as you've been studying enobosarm in the older population, obviously, those at risk of sarcopenic obesity and seeing the data you have, obviously, very encouraging. Just wondering if your thoughts as you take the compound forward into registration, if you'll include a means to study it maybe in a broader population of people who are not as old, given that there is also maybe a risk of muscle loss during weight loss.

So first, the statistics. It turns out, as I mentioned, that 22% of the population, older based on Medicare over the age of 60, 42% of those patients could benefit from a weight reduction drug if they’re overweight/obese, and one-third of them have true sarcopenic obesity. So that's a big, big market, okay, big market. Now the question is, how about outside that market? It turns out, if you look at just forget age, the data shows that 31 million Americans have sarcopenia. And they're obese. So that presumably includes the patients who are younger. The idea is from a clinical benefit-risk profile to treat patients that have a problem. The older patients are more likely, because as you know, we didn't screen for sarcopenia. We just took those over the age of 60, and still 42.6% of those patients had a greater than 10% decline in GLP-1. This demonstrates that with the Stair Climb Test, patients were in trouble and people were talking about it. But if you do a 6-minute walk test and an endurance test, that's different. But if you do a test that's focusing on leg muscles and muscles that are important for what they call explosive force, getting out of a chair, getting out of a tub, going upstairs, that's different. And those are the muscle types called type 2 muscle that goes away with age. When you treat with enobosarm or a testosterone-type product, you build back the type 2 muscle, and that's why you see function. It's a difference between taking an endurance runner and an older patient. The endurance runner is not going to be able to lift heavy weights like a bodybuilder, but they can certainly run 6 miles or 10 miles or whatever. We focus primarily on the activities of daily living that matter to patients. But with that said, the FDA has told us that a drug of this nature would have benefit in younger patients as well. So if that's the case, Gary Barnette, who's on the call, has a strategy to address that in our Phase III. Gary, do you want to talk about that?

Obviously, if the FDA asked for a more broader age population and if we deem it appropriate, what I would do is design the study with statistical power on efficacy in the older population and include the younger population as observational and maybe have an overall analysis for every randomized subject, but do a subgroup as the primary, meaning older over 60, the group we just ran, with additional efficacy and safety data generated in the younger population to support broadening the label, if appropriate.

And just a follow-up question. Just wanted to confirm that when Veru reports the extension data from the second part of the QUALITY study coming up in a few months, if you'll also be including the full complement of the safety observations from both parts of this study.

So to make sure I understand the question. So when the study is unblinded and we're reporting the Phase 2b extension study, will we be reporting the full safety data set? Is that the question?

Yes.

The answer is yes.

Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference back over to Dr. Mitchell Steiner for any closing remarks.

Great. Thank you. I appreciate everyone who joined our call today, and I look forward to updating you on our progress and excited about the prospects of enobosarm, not only in patients in the Phase 2b study, but also the extension study. And again, thank you all for being on the call.

The digital replay of the conference call will be available beginning approximately noon Eastern Time today, February 13, by dialing 1 (877) 344-7529 in the U.S. and 1 (412) 317-0088 internationally. You will be prompted to enter the replay access code, which will be 3764668. Please record your name and company when joining. The conference has now concluded. Thank you for attending today's discussion.