Q2 2023 Arcturus Therapeutics Holdings Inc Earnings Call
Participants
Andrew H. Sassine; CFO & Director; Arcturus Therapeutics Holdings Inc.
Joseph E. Payne; Founder, President, CEO & Director; Arcturus Therapeutics Holdings Inc.
Neda Safarzadeh; VP and Head of IR/PR & Marketing; Arcturus Therapeutics Holdings Inc.
Padmanabh Chivukula; Founder, Chief Scientific Officer, COO & Secretary; Arcturus Therapeutics Holdings Inc.
Boran Wang; Associate; Guggenheim Securities, LLC, Research Division
Carly Nicole Kenselaar; Analyst; Citigroup Inc., Research Division
I-Eh Jen; MD of Healthcare Research & Senior Biotechnology Analyst; Laidlaw & Company (UK) Ltd., Research Division
Myles Robert Minter; Analyst; William Blair & Company L.L.C., Research Division
Pete George Stavropoulos; Biotech Analyst; Cantor Fitzgerald & Co., Research Division
Wing Cheung Yip; Research Analyst; H.C. Wainwright & Co, LLC, Research Division
Yanan Zhu; Senior Equity Analyst; Wells Fargo Securities, LLC, Research Division
Yasmeen Rahimi; MD & Senior Research Analyst; Piper Sandler & Co., Research Division
Presentation
Operator
Greetings, and welcome to Arcturus Therapeutics Second Quarter 2023 Earnings Call. (Operator Instructions) As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, Neda Safarzadeh, Vice President, Head of Investor Relations, Public Relations and Marketing. Please go ahead.
Neda Safarzadeh
Thank you, operator.
Good afternoon, and welcome to Arcturus Therapeutics Second Quarter 2023 Financial Update and Pipeline Progress Call. Today's call will be led by Joseph Payne, our President and CEO; and Andy Sassine, our CFO; Dr. Pad Chivukula, our CSO and COO, will join in for the Q&A session.
Before we begin, I would like to remind everyone that the statements made during this call regarding matters that are not historical facts are forward-looking statements within the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of performance. They involve known and unknown risks, uncertainties and assumptions that may cause actual results, performance and achievements to differ materially from those expressed or implied by the statement. Please see the forward-looking statement disclaimer on the company's press release issued earlier today, as well as the Risk Factors section in our most recent Form 10-K and in subsequent filings with the SEC.
In addition, any forward-looking statements represent our view only as of the date such statements are made. Arcturus specifically disclaims any obligation to update such statements to reflect further information, events or circumstances.
And with that, I will now turn the call over to Joe.
Joseph E. Payne
Thank you, Neda, and it's good to be with you again, everybody. We look forward to providing our updates today on our quarterly investor call. I will begin my remarks by highlighting our progress with our ARCT-154 COVID-19 vaccine Phase III program.
We're pleased with the rapid development and regulatory process -- progress recently made with our alliance partner, Meiji Pharma, toward the approval of ARCT-154 by the Japanese regulatory authorities. The ARCT-154 submission is supported by an active controlled Phase III booster vaccine study that was executed during a period when multiple COVID variants were circulating. Initial ARCT-154 Phase III booster study results were released as preprint last month in med archive.
The study achieved its primary endpoint, demonstrating non-inferiority of neutralizing antibody response against the SARS-CoV-2 ancestral strain when compared to Comirnaty. The study also demonstrated superiority of ARCT-154 in neutralizing antibody response against the Omicron BA.4/5 variant as a key secondary endpoint. The results of this trial indicate increased immunogenicity associated with ARCT-154 at 28 days following booster at administration.
For the ancestral strain, the geometric mean ratio of neutralizing antibodies between ARCT-154 and Comirnaty was 1.43-fold, indicating elevated neutralizing antibodies against the vaccine strain versus the comparator. Based on available Phase III clinical data at the time of interim analysis, ARCT-154 continues to demonstrate a favorable safety and tolerability profile with no additional safety concerns identified.
In today's earnings release, we also included new ARCT-154 Phase I/II clinical data, which suggests a durable immune response up to 1 year following booster administration. Notably, neutralizing antibody levels remained greater than tenfold above baseline across a panel of variants, including Omicron. During the 1-year -- and this is during the entire 1-year observation period.
In summary, ARCT-154 has shown broad neutralizing capability against multiple variants of concern, and has the potential to offer not only effective but also a longer-lasting immune response that may suggest durable protection against COVID-19. We're very pleased with the ARCT-154 clinical data, and now believe that this next-generation self-amplifying mRNA platform is meaningfully different than conventional, currently-approved mRNA vaccines.
I will note that the ARCT-154 dose is very much lower. In our head-to-head study, ARCT-154 was dosed at only 5 micrograms. This is an 83.3% lower dose than Comirnaty and at least 90% lower than other approved mRNA vaccines.
As previously reported, in April, Meiji submitted a new drug application in Japan to support potential initial approval of ARCT-154 as a primary immunization vaccine. And in June, we were pleased to hear that Meiji filed the NDA for the booster and included the relevant data to support that booster application. The review process with the PMDA is ongoing, with Japanese NDA approval being our next targeted milestone. A positive PMDA decision would represent Arcturu's first product approval, a tremendous achievement for our company. And approval or unapproval, along with the promising data that we've collected, is indicative of the broader opportunity for Arcturus' mRNA technology platform.
I'll now move on to provide an update on ARCT-810. This is our messenger RNA therapeutic candidate for ornithine transcarbamylase, or OTC deficiency. This investigational medicine is designed to functionally replace the deficient OTC enzyme in the liver and thereby restore urea cycle activity and prevent metabolic crises that cause neurological damage. ARCT-810 could potentially reduce the need for ammonia scavengers and ease the rigid dietary protein restrictions that OTC patients face today, thus improving quality of life for those living with this disease.
In June, we announced that the FDA had granted ARCT-810 with fast track designation. The company has also recently received Rare Pediatric Disease designation from the FDA for ARCT-810. Rare Pediatric Disease designation is designed to recognize those rare diseases in children in which serious or life-threatening manifestations primarily affecting patients from birth to 18 years of age. Now due to this designation, if ARCT-810 achieves approval for a pediatric indication, Arcturus will receive a voucher for priority review of a subsequent marketing application for a different product.
ARCT-810 is currently being evaluated in 2 ongoing clinical studies in patients, a Phase Ib study in adults and a multi-dose Phase II study in adolescents and adults with OTC deficiency. The Phase Ib single-ascending dose study is being conducted in the United States and has completed dosing of all planned cohorts in a total of 16 subjects. The ARCT-810 Phase II study is being conducted in the United Kingdom and Europe, and plans to enroll up to 24 adolescents and adults with OTC deficiency. The ongoing study is evaluating 2 dose levels and includes up to 6 biweekly administrations for each participant. We expect to share interim data on biological activity from a subset of patients in the coming months.
Now I'll move on to ARCT-032. This is our inhaled messenger RNA therapeutic for cystic fibrosis. This program is designed to express fully functional CFTR protein in the lungs of individuals with CF, utilizing our LUNAR delivery technology that has been highly optimized for inhaled delivery to the lungs. Our approach is agnostic to the underlying mutations associated with the disease, and as a result, this program could provide clinical benefit across a wide range of those living with CF, including those that are not well served by currently-approved CFTR modulators.
In June, at the European CF Society Conference in Vienna, in collaboration with the University of Alabama Birmingham lab, we reported promising data demonstrating that ARCT-032 fully restore CFTR expression and function in vitro in bronchial epithelial cells from CF donors. In the past, improvement in chloride transport in these human bronchial epithelial cells treated with CFTR modulators has been associated with improved clinical outcomes.
The ARCT-032 clinical development program continues to advance according to plan. We're pleased to report today the successful completion of dosing in our Phase I study. The study includes 32 healthy participants, including 8 subjects in each of 4 dose cohorts being tested. We look forward to reporting interim safety and tolerability study results later this year.
We received regulatory approval of a protocol amendment to allow the transition to a Phase Ib clinical study of ARCT-032 in up to 8 cystic fibrosis patients. The study will be conducted in New Zealand and continuing to advance this important investigational medicine. Our strategic collaboration with CSL Seqirus, this is Arcturus' exclusive global licensee, is focused on the development and commercialization of next-generation mRNA vaccines and continues to make strong progress. Our LUNAR-FLU program, for example, continues to progress with funding and operational support from CSL Seqirus. LUNAR-FLU utilizes Arcturus' validated next-generation STARR mRNA platform.
And with that, I'll now pass the call to Andy.
Andrew H. Sassine
Thank you, Joe, and good afternoon, everyone.
The press release issued earlier today includes financial statements for the second quarter and 6 months ended June 2023, and provides a summary and analysis of year-over-year financial results. Please also reference our most recent Form 10-Q for more details on the financial performance.
We're very pleased with the ARCT-154 new drug application to the PMDA in Japan, and we believe that this product could represent an improved vaccine option for patients as well as an important source of potential future revenues for our organization. Furthermore, the development and manufacturing plan supporting ARCT-154 was carried out in a financially disciplined and efficient manner.
I will remind you that the Phase III Japanese booster study, as well as product manufacturing related to this collaboration, are being funded by Meiji Seika Pharma and the Japanese government. Also, in April, Meiji Seika Pharma entered into an agreement with CSL Seqirus, whereby Meiji will be responsible for the regulatory approval, marketing, distribution and sales of ARCT-154 in Japan, as well as coordinating manufacturing of COVID vaccine products with our catalyst for the Japanese market.
We're thrilled to announce the completion of a state-of-the-art mRNA drug substance manufacturing facility in Japan with our partner, ARCALIS. A team of delegates from Arcturus led by our senior executives and scientific team attended a grand opening ceremony of the cutting-edge cGMP facility in Tokyo, Japan this past week. The ceremony was a celebration of collaboration and partnership as Arcturus joined forces with Japanese health care leaders and senior government officials to inaugurate the first mRNA manufacturing facility in Japan.
Located in a strategic hub for biomedical research and development, ARCALIS is poised to become a key player in the global mRNA drug manufacturing landscape. ARCALIS's new plant meets current good manufacturing practice and is equipped with the world's most advanced manufacturing control and quality control system to efficiently manufacture high-quality substance for mRNA pharmaceuticals.
In April 2023, we received an advanced payment of $23.6 million for the manufacturing and supply of ARCT-154 booster vaccines from CSL. The advanced payment is for specified manufacturing runs of ARCT-154, which includes the drug substance as well as the reservation fees and related manufacturing requirements.
As Joe mentioned, the LUNAR-FLU program continued to progress with funding and operational support from CSL, and additional updates will be provided soon.
I will now provide a summary of our financial results for the second quarter of 2023.
Our primary source of revenues were from license fees, consulting and related technology transfer fees, reservation fees and collective -- collaborative payments received from research and development arrangements with pharmaceutical and biotechnology partners. For the 3 months ended June 30, 2023, we reported revenues of $10.5 million compared with $27.1 million for the 3 months ended June 30, 2022. The decrease was primarily attributable to a decrease in revenues of $12.7 million related to the termination of the agreement with Vinbiocare and a decrease in revenue of $12.5 million related to the agreement with the Israeli Ministry of Health. The decrease was primarily offset by an increase in revenue of $8.6 million related to the collaboration agreement with CSL and the grant agreement with BARDA, which were both executed in the second half of 2020.
Revenue increased by $58.5 million during the 6 months ended June 30, 2023 compared to the prior year period. The increase was primarily attributable to an increase in revenue of $87.6 million related to the collaboration agreement with CSL Seqirus and the grant agreement with BARDA.
Total operating expenses for the 3 months ended June 30, 2023 was $65.9 million compared with $49.2 million for the 3 months ended June 30, 2022. Total operating expenses for the 6 months ended June 30, 2023 were $131.4 million compared with $104.8 million for the 6 months ended June 30, 2022.
Our research and development expenses consist primarily of external manufacturing costs, in vivo research studies and clinical trial performed by contract research organization, clinical and regulatory consultants, personnel-related expenses, facility-related expenses and laboratory supplies related to conducting R&D activities. R&D expenses were $52.7 million for the 3 months ended June 30, 2023, compared with $38.2 million in the comparable period last year, primarily reflecting increased clinical research and manufacturing costs of $11.4 million and an increase of $2.9 million in personnel-related expenses.
R&D expenses were $104.4 million for the 6 months ended June 30, 2023, compared with $83.1 million in the comparable period last year, primarily reflecting increased manufacturing and personnel costs.
General and administrative expenses primarily consist of salaries and related benefit of our executive, administrative, legal and accounting functions and professional service fees for legal and accounting services, as well as other general and administrative expenses. G&A expenses were $13.2 million and $27 million for the 3 and 6 months ended June 30, 2023, respectively, compared with $11 million and $21.7 million in the comparable period last year. The increase has resulted primarily from personnel expenses due to increased head count and salaries, increased travel and consulting expenses as well as an increased rent expense associated with the new headquarters facility.
For the 3 months ended June 30, 2023, Arcturus reported a net loss of approximately $52.6 million or $1.98 per diluted share compared with a net loss of $21.6 million or $0.82 per diluted share in the 3 months ended June 30, 2022. For the 6 months ended June 30, 2023, Arcturus reported a net loss of approximately $1.8 million or $0.07 per diluted share compared with a net loss of $72.7 million or $2.75 per diluted share in the 6 months ended June 30, 2022.
Cash and cash equivalents and restricted cash were $380.6 million as of June 30, 2023, and $394 million on December 31, 2022. We have collected approximately $300 million in upfront payments and milestones from CSL as of June 30, 2023. Additionally, in the second quarter, we received $23.6 million under the manufacturing and supply of ARCT-154 from CSL. We expect to continue receiving future milestone payments from CSL that will support the ongoing development of the COVID and FLU programs.
Finally, I'm happy to report the cash run rate remains extended through the beginning of 2026, based on the current pipeline and programs.
In summary, we believe the company remains in a strong financial position and has the resources needed to achieve multiple near-term, value-creating milestones for the vaccine and therapeutic programs. Furthermore, with the anticipated ARCT-154 product approval later this year in Japan, we look forward to beginning to report potential commercial sales in the next few years.
I will now pass the call back to Joe.
Joseph E. Payne
Thanks, Andy. We've continued to make excellent progress and advance our proprietary messenger RNA and LUNAR delivery platform technologies toward later stages in clinical development. It was great to hear the progress of our catalysts and our partner there on the manufacturing facility in Japan, and we're especially excited about the progress toward our first product approval potentially later this year with ARCT-154. The achievement would definitely mark a critical milestone for the platform and for Arcturus.
So with that, I'd like to turn the time over to the operator for questions.
Question and Answer Session
Operator
We will now be conducting a question-and-answer session. (Operator Instructions) Our first question comes from Yasmeen Rahimi with Piper Sandler.
Yasmeen Rahimi
And congrats on all the updates, especially on the manufacturing facility.
Team, could you maybe provide some color in terms of the timing of the approval in Japan, if that's still set for the fall?
Second, maybe you could also provide us some thoughts around manufacturing capacity. Would you be able to, by the time you receive approval in Japan, to facilitate and produce over 70 million doses if needed?
And then the third question is on the CF program. Are you planning to share the single ascending data? Could you comment how high you want a dosing? And then lastly, what are the doses you're moving forward into the [MAT] portion? I'll jump back into the queue and my apologies for so many questions.
Joseph E. Payne
Sure. Well, with respect to the first question on the approval time line, I can address that. You can appreciate that the review process is ongoing with the PMDA, whether it's CMC and non-plan and clinical package insert and risk management plan questions, right? These are all standard and we're going through this ongoing process with the PMDA. So it means that we remain on track for later this year with respect to approval.
With respect to capacity, I'm going to turn the time to Andy to address that.
Andrew H. Sassine
Thanks. Yasmeen. With respect to capacity in Japan, we've clearly indicated that -- the fact we will not be operational in producing until next year. And furthermore, we will defer those kind of questions to our partner, ARCALIS and Meiji in Japan and CSL as well. So hopefully, you can appreciate they're in control of the commercial program here and have licensed out our ARCT-154 in future COVID products. So we're going to have to rely and depend on them for guidance with respect to capacity, but I'm sure they'll provide it when the time is appropriate.
Joseph E. Payne
And to address your final question about CF. We have not, and by intention, not disclosed any of the dose levels that we've evaluated given that the environment is competitive, but I can share with you that each patient will receive 2 doses in the Phase Ib amendment. So up to 8 CF patients and each will receive 2 doses, but the specific dose level, we're not disclosing at this time.
Yasmeen Rahimi
Okay. Great. And I'll jump back into the queue.
Operator
Next question comes from Myles Minter with William Blair.
Myles Robert Minter
Congrats on the booster data as well. Nice to see that. Just on 154, if you do receive approval by year-end in Japan, do you think you've got the right strain in there to potentially deliver some doses in this current vaccination season? I just know one of your peers out there, Daiichi, they got approval and then clearly stated they'd be switching to an XBB strain to supply the current period. So that's the first question.
Joseph E. Payne
Yes. Myles, thanks for joining the call. It's good to hear you. You're absolutely right. All the regulatory agencies, including PMDA, are evaluating all the variants of interest in a particular region, in this case, Japan, and Arcturus is prepared to address whatever they request. So right now, you've seen the profile of ARCT-154, and it's broadly acting against a variety of variants. But if it's deemed by the PMDA for whatever reason to proceed with another variant of interest, whether that's XBB or something else, we're prepared to immediately respond and we're positioning the company strategically to do so, okay, with CSL and Meiji involved in this process.
Myles Robert Minter
Okay. And then the second question is just on duration. Thanks for supplying that Phase I/II data. Are we going to see duration of immunogenicity out of the Phase III booster trial? And what are your sort of predictions on the Comirnaty neutralizing antibodies sort of as we get into the 6 to 12-month period out of that trial?
Joseph E. Payne
Yes. No, I appreciate the question. Clearly, this data we shared today is very exciting. It's very promising. We're happy to see just a really strong durability signal from ARCT-154. It's a good representation of this next-generation self-amplifying mRNA platform. It's clearly different. So with respect to the Phase III data set, we intend to share that data for the 6-month time point later this year. And we'll be more than happy to share that at that time.
Operator
Next question comes from Seamus Fernandez with Guggenheim Securities.
Boran Wang
This is Evan Wang on for Seamus. I have 2 questions. First, on COVID. Just wondering if you could share some color on the Japanese COVID market? Really trying to figure out some of the opportunity for '23, '24, particularly with the, I believe, first 25 million vaccine purchase from Japan and expectations for additional orders.
Second, on OTC, wondering if you can provide enrollment updates there and what we can expect from an update later this year? Will that be specific to 810? Or should we expect a broader update as well?
Joseph E. Payne
All right. So your first question is with respect to the opportunity for vaccine purchases in Japan, right? I guess I'll turn that over to Andy. Do you want to address that?
Andrew H. Sassine
Yes. I think we obviously are very excited that the Japanese government continues to purchase the vaccines, the COVID-related vaccine for its population. And historically, they purchased about 80 million vaccines as of the last 12 months that we have record from the Japanese government. So certainly, the future orders that we're currently seeing and anticipating are certainly a testament to their concern about COVID during an endemic phase here. And certainly, the approval of Daiichi in Japan for a conventional mRNA vaccine made in Japan is certainly viewed as very favorable here for not only Arcturus but our partners, Meiji and CSL because the Japanese government is very committed to ensuring that in the future Japan will be vertically integrated and completely independent of any future manufacturers for any related pandemic type of viruses. And I think that's pretty exciting that the government had taken on this initiative to be self-sufficient. And hopefully, we can be a part of it and we'll certainly learn more soon.
But with respect to specific orders, we really cannot provide that at this time. It will certainly be developed and articulated by Meiji and CSL soon.
Joseph E. Payne
And then with respect to your second question on ARCT-810 enrollment, I think we haven't provided specific guidance there, but we encourage people to look to other rare liver disease companies on the pace of their enrollment as a basic guide as to what to anticipate.
Padmanabh Chivukula
When we have finished enrollment of the Phase Ib portion of the trial, and as Joe mentioned in his remarks, that we intend to share some data around the 810 later on in the coming months.
Joseph E. Payne
Yes.
Operator
Next question comes from Pete Stavropoulos with Cantor Fitzgerald.
Pete George Stavropoulos
Joe, Andy and team, congratulations on all the progress and the booster data presented in MedRx. It was nice to see the non-inferiority and superiority and non-neutralizing capabilities compared to an approved vaccine.
So first question, regarding the manufacturing capabilities in Japan, can you potentially leverage them for outside Japan with 154 and possibly other future candidates? Or will the facility be strictly focused on COVID vaccine?
Andrew H. Sassine
Absolutely, Peter. That's a really good question, and thanks for being on the call. We anticipate that ARCALIS will become a full-fledged mRNA facility with not only the capability of drug substance and drug product, but certainly going to be a world-class facility for any type of mRNA capability going forward. So it's up to ARCALIS to announce all this specifics with respect to their capability, and I'll leave it up to them. But they do have an exciting future, and we're a part of it. And certainly, we'll have more detail with our partner as soon as it becomes available.
Pete George Stavropoulos
All right. And for 032, I know that you have fully enrolled the Phase I in terms of healthy volunteers. And I know the focus is safety and tolerability. But now that you're expanding into patient population, what are some of the ways that you may evaluate the pharmacodynamic response?
Joseph E. Payne
Yes. There's -- we're going to be looking primarily at safety and tolerability in patients. I know we're very pleased with the results so far that we've seen in Phase I in healthy volunteers. This was the first time anyone has inhaled LUNAR technology. And so now that we transition to patients in Phase Ib, that is the primary objective here because we have a stellar preclinical data set of really positive data. So we just want to first see safety and tolerability in this Phase Ib set of patients.
Having said that, we're positioning ourselves to evaluate LCI or lung clearance index. And this is a sensitive measure of lung function. So we will look to see if after 2 doses, if we can see something. But the primary objective here is just to establish safety and tolerability in patients.
Pete George Stavropoulos
All right. All right. And the last question is, I know you gave a brief sort of update on enrollment and how to look at other programs. But have you activated all the sites? And if not, how many more can you potentially activate to help enrollment move along?
Joseph E. Payne
We're essentially at capacity with respect to activating sites. Our team has been traveling through Europe and following up with all the principal investigators in this manner. So we're working hard to enroll patients. And that's the guidance we've provided and that we remain consistent on providing some data later this year or in the coming months.
Pete George Stavropoulos
All right. Congrats on the progress once again.
Joseph E. Payne
Yes. Thanks, Pete.
Operator
Next question comes from Yanan Zhu with Wells Fargo.
Yanan Zhu
Congrats on the progress. I wanted to get maybe a little more clarity on what might happen after a potential Japan approval? So I think Daiichi's decision, at least looking at the news release, is by itself, and it doesn't look like the PMDA instructed it not to supply the market with the original strain vaccine. So I was wondering what is your and your partner thinking once you receive the approval, what the thinking process in terms of whether to supply the market? And if you do supply the market, I was wondering who is the manufacturer? Is that you, your facility or the ARCALIS facility?
Joseph E. Payne
Well, with respect to commercial guidance?
Andrew H. Sassine
With respect to the second, obviously -- thanks for the question, Yanan. But certainly, our current manufacturing partners which represents Catalent and Aldevron in the U.S. and Recipharm in Europe would be the suppliers of any current supply. As you know, we've articulated the Japan facility, it won't come online until next year. So any kind of orders for Japan from that facility probably will not be until next year, late or the year after. So hopefully, you can appreciate that. We have a dual process in place to be able to provide the Japanese market with our vaccine as soon as possible. And certainly, once the factory is up and running in Japan, that they'll be able to supply going forward.
Hopefully, that helps clarify that situation, and Joe can address the first part of the question.
Joseph E. Payne
Yes. With respect to the other vaccine or vaccines getting approved in Japan, we're very happy to see that Japan is following their domestic strategic plan. We've touched on this earlier in the call a little bit. We view this very positive because we feel like we're part of this domestic plan with Meiji and CSL.
But our -- what sets this vaccine technology apart from all other conventional mRNA vaccines that have been approved or soon to be approved is our dose level. So our dose level is significantly lower. Our serial response rates that we've observed seem to be differentiating. Clearly, people have to be taking this dose level into consideration when it comes to safety and reactogenicity that's potentially differentiating. And then finally, the data we showed today, the durability data is very promising. So -- and can set this technology apart.
So as we work with Japan and their strategy, we definitely see a way to fit in line with their objectives to address some of the key issues in protecting their people with a vaccine strategy.
Yanan Zhu
Got it. And you touched on durability, congrats on the data. I was wondering, can you talk about the underlying biological basis for this durability? And your confidence that we could see this observation replicated in the longer follow-up for the Japan study?
Joseph E. Payne
Yes. It's a great question. Self-amplifying mRNA is providing very encouraging durability data. And your question is why, and it's because the mechanism of how this -- the self-amplifying mRNA molecules make the antigen. Conventional mRNA make the antigen for a period of time and then degrades, right? But self-amplifying mRNA, this next-generation mRNA technology, extends the duration of making that antigen. So the body sees the antigen for a longer period of time. That means it is allowed to increase the antibody titer levels, and that's what we've seen in the Phase III comparison study.
And we've all -- because the body sees the antigen for a longer period of time, it allows a broader spectrum of antibodies to be made. And when you combine those 2 features of increased antibody titers with a broader spectrum of antibodies being created by the body, this translates into a longer lasting vaccine. And that would provide an explanation as to explaining what -- why we're seeing what we're seeing.
Yanan Zhu
Got it. So we might -- we should be able to see something similar with the Japan study? Am I correct?
Joseph E. Payne
Yes, well -- correct. Correct. That's what you would expect. And remember, previously, we've seen in our Phase I and Phase II studies that the antibody titer levels tend to increase beyond 1 month or beyond 4 weeks, so will we see that as well in Phase III is yet to be understood. But yes, our expectations are high and very optimistic.
Yanan Zhu
Got it. And lastly, on the OTC deficiency program. I was wondering in the news release, you mentioned you may announce data from a subset of the patients. I was wondering, could we expect 1 or both cohorts of the patients' data being reported out? And what type of changes clinically or in terms of biomarkers can be expected with roughly a 3-month duration?
And lastly, would you be able to comment on any next steps that we can expect once you have reported the data?
Joseph E. Payne
Well, I appreciate the question and wanting to understand additional detail on different dose levels in the OTC clinical trial. But the only guidance we're providing today is some biological proof of concept or some biological data that will provide in a subset of patients. So I can't provide any more detail than that.
With respect to any biomarkers that we're tracking, we will be tracking them for an extended period of time, and that includes ammonia and urea genesis. And other amino acids can be -- such as glutamate, for example, can be measured. Several amino acids are impacted by the urea cycle. And OTC itself can be measured, the ornithine transcarbamylase enzyme that's built or expressed in these liver cells. These liver cells, just so you're aware, can be sloughed off into the circulation and measured in the plasma. And so we can track OTC levels as well and over an extended period of time.
Operator
Next question comes from Yigal Nochomovitz with Citi.
Carly Nicole Kenselaar
This is Carly on for Yigal. First, just curious if there's anything more you can say about CSL's progress on the seasonal flu vaccine? And if that work has maybe accelerated at all after the COVID data? Do you have a sense for time lines for potentially bringing a flu candidate into the clinic?
Joseph E. Payne
Well, I can provide 1 comment. You're absolutely right that the Meiji, CSL and Arcturus teams are all united in excitement over this recent data set. And that excitement bleeds into other programs, of course. It gives us more energy and more ambition and vigor in other programs.
And so your question about the flu is appropriate. We have to be very careful. It's -- I would consider, even though we're working closely with CSL, it is their program and there's -- their program to guide on. So it's very difficult for us to just give a candid response to your question on guidance. Having said that, we look forward to continuously update the market because this is an active program for us. We've reported milestones on this previously this year, and clearly, this is a program of high interest for CSL. And Andy, anything to add?
Andrew H. Sassine
Yes. In my comments, I obviously said that we will have update provided soon, so stay tuned. Thank you.
Joseph E. Payne
Yes.
Carly Nicole Kenselaar
Okay. Got it. That's helpful. And then just on OTC and CF. I know that the ongoing Phase II in OTC is active in the U.K. and Europe, and then you're also recruiting in New Zealand for the CF program. Just curious, any comments on potential time lines and plans for opening sites in the U.S. for those studies?
Joseph E. Payne
Well, we already have active trial ongoing in -- for COVID and the vaccine enterprise in the U.S. already. So we already have an active effort in the United States. And for OTC, we have an active effort in the U.S. with our Phase Ib trial in patients.
With respect to CF, you can see that we have a very strong relationship with the CF Foundation, and they have considerable oversight and influence on the U.S. area, not just globally. But we haven't indicated any guidance as to when we'll be conducting any clinical trial efforts in CF in U.S. There will be an appropriate time to do so, but today is not that day.
Operator
Next question comes from Ed Arce with H.C. Wainwright.
Wing Cheung Yip
This is Thomas Yip asking a couple of questions for Ed. Congratulations on all the progress with Meiji in Japan. So first, perhaps looking a little bit into the future. Do you have any plans right now to expand 154's use in populations beyond adults in Japan? And if so, what can investors think about the estimated time line?
Joseph E. Payne
Yes. The short answer is yes. There's a lot of activities we'd like to expand because our Phase III trial was in adults, right? So there's more than just adults in Japan, and CSL has a definite -- and Meiji has a clear interest in expanding the commercial opportunity beyond adults. So -- but I can't give specific guidance on that. It's theirs to provide.
But outside of Japan, CSL is our exclusive partner for distribution and commercialization in U.S. and Europe, for example. So we'll be looking to them to provide guidance on those efforts.
Wing Cheung Yip
Got it. Perhaps just 1 more question from us regarding 032 with the CF. A lot of interest on this and the OTC program, clearly. Perhaps for the Phase I study, when can we expect the first CF patients to be enrolling to the study? I know you just received clearance. And also, what -- when can we expect the initial data set with CF patients?
Joseph E. Payne
Well, we've conservatively guided the initiation of enrollment in the second half of this year, and we'll allow that to unfold. And then with respect to data, that will be at a later time point. I think we're focused on the near-term objective of enrolling, initiating enrollment for these up to 8 CF patients in New Zealand in the second half of this year.
With respect to interim Phase I safety data, interim Phase I safety data is also expected later this year.
Wing Cheung Yip
Okay. Got it. Looking forward to those data along with the COVID regulatory status in Japan as well.
Operator
Next question comes from I-Eh Jen with Laidlaw & Company.
I-Eh Jen
Congrats on all the progress in Japan at this moment. I appreciate the data you provided today in terms of the -- both the duration as well as the breadth of the vaccine 154 it covers.
My question to you is that does this have any read-through in terms of the application in Japan in terms of cover broader background of strain? Then I have another follow-up question.
Joseph E. Payne
Yes. It's a good question. The data we shared today was only using a validated assay. The new strains that are coming forward are only exploratory in nature and not validated yet. So we've remained consistent on sharing data that's only validated assays, right? So there will be a time and a place to provide that data once the assays are validated is the answer.
I-Eh Jen
With that referring you mentioned earlier that you might report a 6-month data in the future time, so maybe later this year. Are these 2 connected in any way?
Joseph E. Payne
All right. If you're referring to the Phase III Japanese comparator study, yes, we're guiding that we'll be able to share a 6-month durability data later this year. Correct.
Padmanabh Chivukula
And -- this is Pad. And I just want to make sure that you understand, we're an mRNA platform company. And because of that, we can update our vaccine readily. So if there's a new strain that emerges, we can, of course, update our vaccine. And because the platform will be approved, we can quickly commercialize that as well. And our manufacturing process is very similar to a lot of the other mRNA players.
Andrew H. Sassine
Keep in mind that with the trial being completed in February, you don't really have the 6-month completion of the data until August. So by the time they collect it and analyze it, you have to give us a few months for that. So hopefully, I give you some kind of runway to understand when conceivably the 6-month data could even be presented. Hopefully, it will be probably a fourth quarter event, if you can appreciate that. Does that make sense?
I-Eh Jen
Absolutely. And I really appreciate the color. And 1 follow-up question here is in terms of the 032 in the CF. In your press release, you mentioned that there was some amendment being tested out, explored or being suggested for the Phase Ib study. Any color in terms of what specific amendment has been placed?
Padmanabh Chivukula
Yes. The amendment is -- our Phase 1 was in healthy volunteers. And what we talked about was -- in Joe's comments that there's been an amendment that was filed, and it was recently approved to include patients in the study.
I-Eh Jen
So therefore, just adding the patient versus purely the healthy volunteers.
Padmanabh Chivukula
That's right.
I-Eh Jen
Okay. Great. Again congrats though.
Joseph E. Payne
Yes. Thank you. I-Eh.
Operator
That was all the time we had for today. I would like to turn the floor back over to Joe for closing comments.
Joseph E. Payne
Thanks for participating on the call today, everyone. If there's remaining questions, please reach out to the team, and we'll get back to you right away. Good night.
Operator
This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a great day.
