Q3 2023 Enanta Pharmaceuticals Inc Earnings Call
Participants
Jay R. Luly; President, CEO & Director; Enanta Pharmaceuticals, Inc.
Jennifer Viera; Senior Director of IR & Corporate Communications; Enanta Pharmaceuticals, Inc.
Paul J. Mellett; Senior VP of Finance & Administration and CFO; Enanta Pharmaceuticals, Inc.
Tara Lynn Kieffer; SVP of New Product Strategy & Development; Enanta Pharmaceuticals, Inc.
Amy Li; VP & Equity Associate; Jefferies LLC, Research Division
Antonio Eduardo Arce; MD of Equity Research & Senior Healthcare Analyst; H.C. Wainwright & Co, LLC, Research Division
Brian Corey Abrahams; Senior Biotechnology Analyst; RBC Capital Markets, Research Division
Douglas Royal Buchanan; Director & Equity Research Analyst; JMP Securities LLC, Research Division
Eric William Joseph; VP & Senior Analyst; JPMorgan Chase & Co, Research Division
Jay Olson; Executive Director & Senior Analyst; Oppenheimer & Co. Inc., Research Division
Luke P. Herrmann; Research Associate; Robert W. Baird & Co. Incorporated, Research Division
Unidentified Analyst
Presentation
Operator
Good afternoon, and welcome to Enanta Pharmaceuticals Fiscal Third Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. There will be a question-and-answer session at the end of the prepared remarks. Please be advised that this call is being recorded. I would now like to turn the call over to Jennifer Viera, Investor Relations. Please go ahead.
Jennifer Viera
Thank you, operator, and thanks to everyone for joining us this afternoon. The news release with our fiscal third quarter 2023 financial results was issued this afternoon and is available on our website. Making formal remarks on today's call are Dr. Jay Luly, President and Chief Executive Officer; and Paul Mellett, our Chief Financial Officer. Dr. Scott Rottinghaus, our Chief Medical Officer; and Dr. Tara Kiefer, our Senior Vice President of New Product Strategy and Development, will be available during the Q&A portion of the call.
Before we begin with our formal remarks, we want to remind you that we will be making forward-looking statements, which may include our plans and expectations with respect to our research and development pipeline and financial projections, all of which involve certain assumptions and risks beyond our control that could cause our actual developments and results to differ materially from those statements. A description of these risks is in our most recent Form 10-Q and other periodic reports filed with the SEC. Enanta does not undertake any obligation to update any forward-looking statements made during this call.
I'd now like to turn the call over to Dr. Jay Luly, President and CEO. Jay?
Jay R. Luly
Thank you, Jennifer, and good afternoon, everyone. At Enanta, we are committed to our mission of being a leader in the development of ground-breaking therapeutics for viral infections. In this quarter, we made important strides to bring us closer to impactful inflection points and ultimately, our goals. I'm proud of the work our team has accomplished this quarter and throughout the year so far across our pipeline and business, most notably in our respiratory syncytial virus or RSV program in our COVID-19 program. We're in a strong position to continue to advance our pipeline, and I am confident in our team's efforts to progress antiviral small-molecule medicines to treat life-threatening viral infections.
Today, I'll provide an overview of our progress during the third quarter, beginning with our RSV program, and then I'll comment on our COVID-19 program and the rest of our pipeline. RSV is a severe respiratory infection associated with significant morbidity and mortality that can cause serious disease in children, the elderly and the immune compromise. RSVs received a significant amount of attention recently with the approvals of new vaccines and monoclonal antibodies to help prevent severe infection. However, given the experience with COVID and flu vaccines, including limited adoption and breakthrough infections, we believe a safe and effective oral RSV antiviral medication can bring significant value to patients infected with RSV.
Starting with our most current update, we recently announced positive data from the Phase I trial of EDP-323 in healthy volunteers. As a reminder, EDP-323 is our L protein inhibitor in development as a once-daily oral treatment for RSV with fast-track designation from the FDA. This Phase I study enrolled healthy volunteers to evaluate the safety, tolerability and pharmacokinetics of oral EDP-323 in single ascending doses and multiple ascending doses for 7 days, along with the effect of food. The SAD phase enrolled a total of 6 cohorts, ranging in dose from 50 to 800 milligrams, and the MAD phase enrolled 4 cohorts with doses ranging from 200 to 800 milligrams. EDP-323 was found to be generally safe and well tolerated up to the highest dose tested of 800 milligrams over 7 days. Most adverse events were mild, and there were no serious or severe adverse events.
There was one study discontinuation due to syncope, which was deemed unlikely to be related to EDP-323. EDP-323 exposure increased with increasing single and multiple dosing up to 600 milligrams with a half-life ranging from 11 to 17 hours supporting once-daily dosing. EDP-323 doses ranging from 200 to 800 milligrams once daily, resulted in strong EC90 multiples against both RSV A and B strains. And when administered for 7 days were found to result in C24 concentrations at study state of 11 to 44 fold over protein adjusted EC90 of 0.3 nanomole against both RSV A and B strain. Additionally, no food effect was observed with the high-fat meal, suggesting that EDP-323 can be administered without regard to food. We are pleased with this encouraging safety and pharmacokinetic data. In virology, one of potent antiviral, such as EDP-323 achieves high multiples of EC90 safely. It is a very positive signal and an important de-risking step for the program. These data enhance our belief in EDP-323 as a potential therapeutic and give us the confidence to continue to progress the program.
We believe EDP-323 could serve as a stand-alone treatment or be used in combination with other agents such as EDP-938 to broaden the treatment window or addressable patient population for RSV. We plan to initiate a human RSV challenge study evaluating EDP-323 early in the fourth quarter, and we anticipate having results in the second quarter of 2024. Our broad RSV program also includes EDP-938, the only N-protein inhibitor in clinical development, which we are currently evaluating in multiple Phase II studies as a potential treatment in high-risk patient populations. These studies include RSVPEDs, a Phase II randomized double-blind placebo-controlled study in hospitalized and non-hospitalized pediatric RSV patients, RSVHR, a Phase IIb randomized, double-blind, placebo-controlled study in adults with RSV infection who are at high risk of complications, including the elderly and individuals with congestive heart failure, chronic obstructive pulmonary disease or asthma; and RSVTx a Phase IIb randomized, double-blind, placebo-controlled study in adult hematopoietic cell transplant recipients with RSV and symptoms of upper respiratory tract infection.
Enrollment for RSVPEDs, RSVHR and RSVTx is ongoing, and we're utilizing sites in both the northern and southern hemispheres to optimize their coverage of potential RSV surges. If there is a return to a normal pre-pandemic type of RSV season in the Northern Hemisphere, we expect to complete enrollment in one or more of these studies in the upcoming Northern Hemisphere season and to have data in fiscal year 2024.
Turning to COVID-19. We announced additional analyses from the Phase II SARS-CoV-2 SPRINT study, which built upon our positive top-line results that we announced in May of this year. EDP-235 is our clinical-stage once-daily orally dosed inhibitor of coronavirus 3CL protease that was evaluated in SPRINT, a randomized double-blind, placebo-controlled Phase II clinical trial in 231 adults with mild or moderate COVID-19 who did not have risk factors for progression to severe disease. Patients received 200 or 400 milligrams of EDP-235 or placebo orally once daily for 5 days.
In the Phase II study, EDP-235 was found to be generally safe and well tolerated. A statistically significant dose improvement in symptoms was observed in the 400-milligram cohort starting as early as 1 day following the first dose. In a predefined subset of patients enrolled within 3 days of symptom onset, a statistically significant dose-dependent improvement in symptoms was observed at all-time points and a 2-day shorter time to improvement was observed in a subset of 6 symptoms in the 400-milligram cohort compared to placebo.
Additional analysis announced in June demonstrated a virologic effect of EDP-235 and the subset of patients who had not recently been infected as measured by lack of antibodies to the SARS-CoV-2 nucleocapsid, whom we refer to as nuclear capsid negative patients. Specifically, in nucleocapsid negative patients, a 0.8 log decline and viral load was observed at day 5 with 400 milligrams of EDP-235 compared to placebo and a 1 log viral load decline at day 5 in the subset of nucleocapsid negative patients who were treated within 3 days after symptom onset. Looking ahead, our current plan is to conduct all future COVID-19 work in the context of the collaboration. In particular, we continue to focus on progressing EDP-235 into Phase III trials with a partner and gaining regulatory feedback to further enable a partnership.
Moving on to our dual inhibitor research program targeting hMPV and RSV, we plan to select a clinical candidate in the fourth quarter of this year. In preclinical studies, our prototype dual inhibitor potently inhibited both hMPV and RSV replication in a dose-dependent manner, demonstrating a significant reduction in viral load of each virus and maintains nanomolar activity against multiple genotypes and strains of hMPV and RSV in a range of cell types. Our dual inhibitor is broader spectrum antiviral that would allow respiratory infections diagnosed as either hMPV or RSV, both of which are significant causes of respiratory tract infections globally to be treated with a single agent, aiding population such as children and the elderly who are at greatest risk.
In hepatitis B, we continue to monitor the field for compounds to develop in combination with EDP-514, our potent core inhibitor with FDA Fast Track designation and a nucleoside reverse transcriptase inhibitor. We believe the core inhibitors such as EDP-514, will ultimately be an important component of a successful combination regimen and that can potentially help us address the high level of unmet need in hMPV.
Finally, looking beyond virology, we are piloting new programs that leverage our core strength and small molecule drug discovery and look forward to sharing more details on these growth areas with you in the coming months. I'd like to wrap up by highlighting our near-term milestones. Again, we are thrilled with the progress of EDP-323 and the positive results from our Phase I study, and we plan to advance EDP-323 into a human challenge study early in the fourth quarter. We anticipate having results in the second quarter of 2024. We plan to announce the selection of a dual inhibitor clinical candidate targeting both hMPV and RSV in the fourth quarter of this year. And if there is a return to a normal pre-pandemic type of RSV season in the Northern Hemisphere, we expect to complete enrollment in 1 or more of our Phase II studies of EDP-938 in the upcoming Northern Hemisphere season and have data in fiscal year 2024.
With that, I'll turn the call over to Paul to discuss our financials. Paul?
Paul J. Mellett
Thank you, Jay. For the quarter, total revenue was $18.9 million and consisted of royalty revenue earned on AbbVie's global MAVIRET net product sales. This compares to total revenue of $19.5 million for the same period in 2022. In April 2023, we sold 54.5% of our ongoing MAVIRET royalties from AbbVie for an upfront payment of $200 million from OMERS, one of Canada's largest defined benefit pension plans. For financial reporting purposes, the transaction will be treated as debt with the upfront purchase payment of $200 million paid to us being recorded as a liability. Enanta will continue to record 100% of future royalty payments as revenue and will then amortize the debt liability proportionately as royalties are paid to OMERS until a cap of 1.42x the purchase payment is met. Interest expense will be recorded in our consolidated statement of operations as other expense based on an imputed interest rate.
Moving on to our expenses. For the 3 months ended June 30, 2023, research and development expense totaled $43 million compared to $39.1 million for the same period in 2022. The increase was due to the timing of clinical trial expenses in our virology programs. General and administrative expense for the quarter was $12.6 million compared to $12.9 million for the same period in 2022. Enanta recorded income tax expense of $4.2 million for the 3 months ended June 30, 2023, driven by the receipt of the $200 million from the royalty sale agreement, which is taxable for federal and state purposes. Enanta was able to utilize federal net operating loss and research and development tax credit carryforwards as well as the deduction for foreign-derived intangible income to substantially offset the taxable effect of the royalty sale agreement.
For the 3 months ended June 30, 2022, Enanta recorded an income tax benefit of $0.4 million, which was due to the release of the state tax reserve during the period. Net loss for the 3 months ended June 30, 2023, was $39.1 million or a loss of $1.86 per diluted common share compared to a net loss of $31.7 million or a loss of $1.53 per diluted common share for the corresponding period in 2022. Enanta ended the quarter with approximately $392.5 million in cash and marketable securities.
We expect that our current cash, cash equivalents and short-term and long-term marketable securities as well as our ongoing royalty revenue should be sufficient to meet the anticipated cash requirements of our existing business and development programs into the second half of fiscal 2027. Driven by changes to our COVID clinical development plans, we are reducing external spending. To that end, we've updated our guidance for fiscal 2023. We now expect our research and development expense to be between $165 million and $175 million, and our general and administrative expense to be between $50 million and $55 million. Further financial details are available in our press release and will be available in our quarterly report on Form 10-Q when filed.
I'd now like to turn the call back to the operator and open the lines up for questions.
Question and Answer Session
Operator
(Operator Instructions) Our first question will come from Brian Abrahams with RBC Capital Markets.
Brian Corey Abrahams
Just a couple of questions for me. First off, on the RSV program and 323. Given the PK data and the safety data that you saw with 323 and healthy volunteers, I'm curious if you could maybe elaborate a little bit more on your latest views on the combined ability and complementarity between 323 and 938 and then I had a follow-up.
Jay R. Luly
Sure. Thanks, Brian. This is Jay. The 323 and 938, we've studied them preclinically to look at their combined ability. And preclinically, they behave very well together. One is an N-inhibitor, that's 938, one's L-inhibitor, that's 323. So we don't expect any issues with combinability from an interaction standpoint. I think the real question is, will we need to combine them? Or will we ultimately want to combine them in certain patient populations? And those are kinds of things that are going to take a little bit longer to sort out.
Number one, we believe that 938 as a stand-alone, could well have all the horsepower we need in garden variety RSV. 323 could also perform very well as a single agent. We'll get more insights into that as we get data from the upcoming human challenge study. But I guess the question is, might you want or need to combine them in a certain very difficult-to-treat patient population. And that's something that we can certainly explore down the road. Or mightn't you want to combine them to see if you could open up a treatment window that would be wider than either agent alone. Again, that's something that we can look at down the line is we're optimizing the category. So those are the initial thoughts right now.
Brian Corey Abrahams
Got it. That makes a lot of sense. And then on the COVID program, can you help us understand the implications of the data you recently reported showing those viral load reductions in the nucleocapsid-negative patients? Should we think about that as potentially speaking to a subpopulation that could down the line be uniquely targetable or just more as further evidence or biological evidence of the mechanism here? And I guess, where do you stand in terms of the regulatory path forward? Can you maybe speak to some of the pads you're exploring? Is it might this still involve an additional Phase II work moving right into Phase III, perhaps exploring long COVID as well?
Jay R. Luly
Yes. So the patient population that you're referring to, I think, is the nucleocapsid negative patient population. These are people who haven't had a recent COVID infection or haven't had one at all. That's a unique antigen that you can look at to determine whether or not someone's again, had the virus somewhat recently. I think one of the takeaways that we gleaned from our further analysis of the data is it's hard to measure viral load changes in the nose of people who have more recently been infected. And when you look at the patient population who hadn't been most recently affected, you could measure viral load changes in the nose.
As time goes on, probably everybody who hasn't been infected is going to be infected. And so variously, that's going to challenge the ability to look at that measurement of viral load change in the nose. But that doesn't tell you anything close to the whole story because what really matters is the viral load changes that are happening elsewhere in the body where sites of infection can set up shop in the respiratory tract and in other tissues. So we feel that that's the more important thing overall. This is why FDA has not embraced using viral load endpoints as a path to approval, but rather to focus on symptoms and outcomes as it relates to COVID infection.
So looking at symptoms where, as you know, in the SPRINT data, we had very nice data set on symptoms. And then ultimately, that endpoint probably changes to hospitalization and death in certain patient populations that are at high risk. So I think that's our takeaway from the data set. And as I look forward, it really doesn't change, I think, how you progress a drug through registration studies. Again, that's all going to be based on symptoms and other kinds of endpoints.
With regards to registration, we are in communication with the regulators. And this is not just in the U.S. but elsewhere, really getting the latest thinking on pathways to approval and different kinds of trial design. So those discussions are in progress. And then as we said before, any next study is our plan to be conducting that study in the context of a partnership. So that ultimately is our plan is to identify that Phase III and commercialization partner and do so hopefully with greater insights from the latest thinking of the regulators in terms of pathways to approval.
Operator
Our next question comes from Jay Olson with Oppenheimer.
Jay Olson
We're curious about the 3 RSV Phase II studies currently enrolling for 938. Can you talk about the enrollment speed interest level? And which one is gaining the most attention? And then for 2024 updates, do you expect to provide each Phase II readout one by one as the results become available? Or will you wait until they're all complete and disclose all the results together? And if you do choose to read them out sequentially, what would be the read across from one trial to another? And then I have a follow-up, if I could.
Jay R. Luly
Sure. Thanks, Jay. This is Jay. We have the 3 Phase IIs for EDP-938, up and running, we've doubled down on the footprint of trial sites. It's not a robust RSV season exactly now. We're between seasons, although that we're still seeing activity in the Southern Hemisphere. We have sites down in Brazil, in Argentina, New Zealand, Australia, South Africa ending in the Northern Hemisphere, where in another 10 countries waiting for the virus to come north. So bid footprint, it's hard to know exactly because they're very different patient populations. So PEDs is one set of circumstances and trial size, the adult high-risk is a different one yet. And then bone marrow transplant recipients are very different patient populations.
So each is going to proceed at its own pace. I think the only thing that I would say is transplant it's probably the hardest because you're, again, asking for a few different, not that common things to happen. One is to have a bone marrow transplant and others to get RSV in a very careful lockdown world for bone marrow transplant recipients, where they're extremely cautious. So I think if I were -- again, you can't truly predict but I would predict that transplant will be lagging behind the other 2.
With the other 2, again, we're in 15 countries. In PEDs, I think we have over 70 sites now active in the adult high risk. We've got over 100 sites active, and we're just waiting for the virus to come back this fall and for the sake of the trials anyway, a really robust standard North American or Northern Hemisphere, I should say, season because we're throughout Europe. We're in the Middle East. We're in Asia and obviously, all across North America. When it comes to reporting out, we're not going to wait. We're not going to harvest all 3 ones. So we'll read them out as they come.
Jay Olson
Okay. Great. I guess as you look ahead to the Phase III studies for 938, how will the adoption of the RSV vaccine play a role in your Phase III strategy?
Jay R. Luly
Yes, sure. Yes, there's vaccines and monoclonal antibodies. Maybe I'll let Tara Kieffer speak to that one.
Tara Lynn Kieffer
Sure. Jay, this is Tara. So in terms of the vaccines that have been recently approved in adults, we don't anticipate that having much of an impact. Both GSK and Pfizer have guided towards minimal uptake of their vaccines, at least initially in the first season. So just by way of example, GSK has guided to expectations to be less than what they saw with Shingrix in the first year. So that was, say, 7% in the first full year. So we don't expect that to have too much of an impact.
Operator
We have a question from Ed Arce with H.C. Wainwright.
Antonio Eduardo Arce
I wanted to start with the RSV program 323 and the recent results from your Phase I, including the PK supportive of once daily. I missed the EC90 multiples that you stated as well as the nanomolar potency. And then beyond that, I just wanted to ask if you could opine on how we should think about benchmarking those relative to potential other agents in development or indeed how to hand or handicap the probability of success.
Jay R. Luly
So thanks, Ed, this is Jay. So the potency of EDP-323, again, this is the L-inhibitor. It's extremely potent. It's 0.3 nanomolar. So 300 picomolar in terms of an inhibitor. That's good, but it's good but not necessarily sufficient. What you want to see is obviously good PK and safety. So those were the 2 other things that we clicked off in the Phase I study. In the MAD doses, we looked at 200, 400, 600 and 800, so a range of 200 to 800 milligrams. And when we looked at the 24-hour through time point after a single dose at the low dose, we saw multiples that were 11x the EC90. And at the high dose, we saw multiples that were 44x the EC90.
So just whopping multiples of that very potent EC90, and we were able to do that in a manner that was very safe and well tolerated. So I know, Ed, you've focused on infectious disease for a long time. When you have an agent where you know the potency, it takes to take out the bug, and you can deliver those concentrations or high multiples of those EC90s safely with either antibacterials or any virals. It's usually a very significant derisking step along the way. So I think it bodes well. The next proof in the pudding, I guess, goes to when we get inside that human challenge study, which, again, will be starting early next quarter.
And with that, we'll actually be able to look at antiviral effects at various doses. So stay tuned for that. Hopefully, that will enroll fairly straightforwardly because the human challenge study recall is in healthy volunteers that we then infect with RSV. So it's not a question of seasonality. It's really just a question of bringing in a cohort after cohort of healthy volunteers to do your exploration. So that will be the next step where we actually show hopefully some very solid antiviral activity.
Antonio Eduardo Arce
Great. Well, I agree that these early readouts do give a lot of confidence in the correlations to actual patient results. The other question I had was around the COVID program. And I believe this is a new decision to look for partnerships for Phase III once you've completed the ongoing study. I'm wondering if the rapid drop in COVID vaccine demand as described recently by both Pfizer and Moderna impact the potential of that program either for licensing or otherwise.
Jay R. Luly
Well, a reduction in vaccination can only lead to an increase in infection where you need an antiviral. So we've always believed this to be the case that ultimately vaccines would never have 100% efficacy. I had 5 vaccinations and still got COVID. So they're never 100% efficacious and compliance is never 100%. We've seen that compliance drop way, way off. Now meanwhile, COVID levels right now are a little -- they're pretty low starting to creep up a little bit here in Boston as we watch the wastewater every day, but they're still pretty low. But we'll see what happens in the fall as we get closer to the normal season.
So I think, ultimately, we all now believe that the virus is not going away. It's going to go back into being like a nasty flu and we need drugs for that. So I think it's actually not new news that our decision on the partnering front. I mean we made that -- I think it's pretty clear last quarter and even before that, we've telegraphed for really since the beginning of the pandemic that our ultimate aim is to find that commercial partner that would really handle the late-stage work and give us a global footprint that we couldn't possibly achieve as well alone where we could do it. So that's still our plan. We'll see what happens to the virus starting to fall.
Operator
And our next question comes from Eric Joseph with JPMorgan.
Eric William Joseph
Actually sticking with the point about benchmarking for EDP-323, I guess, what type of data readout from the human challenge study would give you an indication of the molecule is differentiated perhaps from 938, would you perhaps be including 938 as an active comparator in the trial? And maybe just more generally with respect to the trial design? Are there any key differences in the design of this upcoming human challenge study compared to that conducted in 2019 for 938?
Jay R. Luly
Yes, I think we're going to use the same outset to conduct the study. I think you should be thinking of the study as being very much the same design. And I think one of the world's best benchmarks to look at is EDP-938. That was one of the most robust data sets ever performed in or achieved in a human challenge study. So 938 will be the standard that we'll compare it to. We're not going to do a side-by-side in this study. That would only drag it out further and postpone the time for us to get into later-stage studies with the molecule.
I think we've got such a good handle on that challenge data and how to look at that challenge data that we'll be able to get pretty much everything we need to know from just the drug versus placebo. And to remind you, 938, the kinds of data that we showed with that was an extremely robust antiviral effect. So pretty much within 12 hours of dosing 938, it altered the course of the infection. So people who were on 938 had viral loads that started to stabilize and decline and people on placebo viral loads continue to rise and plateau and only after many days, return back towards normal.
So it was a highly statistically significant antiviral effect that we achieved versus placebo. And the same was the exact result when you looked at it, was achieved with the symptom scores as well. So from a symptom standpoint within a day of dosing, symptoms had stabilized and started to go down, whereas people on placebo symptoms continue to progress, they got worse, and they plateaued at an elevated level and then only gradually resolved over time. So that's the kind of data that we're looking for. And again, we've got a very excellent benchmark comparator with EDP-938.
Operator
We have a question from Roy Buchanan with JMP.
Douglas Royal Buchanan
A couple on 235. Any publications or presentations of detail from the SPRINT data expected later this year?
Jay R. Luly
The timing on that is subject to getting presentations accepted at conferences. So we are planning presentation of the data. So what I will say is stay tuned on that front with regards to timing. And we'll certainly announce the time in place and the venue once we've been accepted for the presentation.
Douglas Royal Buchanan
Okay. Great. And then anything you can give us on the tone of the part of the discussion for 235? As you mentioned, cases that are pretty low in the U.S. at least, are people waiting to see how that plays out this winter. You also mentioned regulatory uncertainty. Maybe is that a gating factor? Anything you can tell us about that?
Jay R. Luly
Not in any degree of specificity, but you've hit on interesting bets that are not only on our minds, obviously, partners think about these things, too. I'm trying to exactly size what the market is and understand as clearly as they can, what that regulatory pathway is. We can't control what the infection looks like and again unseasoned, but what we can try to do is clean clarity from regulators in terms of pathways. So we're working on the part that we can control right now.
Douglas Royal Buchanan
Okay. Great. And then one last one on 514, just mechanism for combination. Are you looking at things that are already out there and being tested like the TLR random choice? Or are you pretty much through those already? And are you looking at something completely novel, maybe hasn't been in the clinic, maybe even from an academic lab?
Jay R. Luly
We've looked at a lot of the usual suspects that are out there. Obviously, the TLRs are out there. People have looked at various RNAi approaches and whatnot. We haven't grabbed onto what we think is necessarily the right mechanism yet. And so we're still monitoring the field. It's a little bit frustrating that there aren't a lot of profound new steps forward in this and this field of HBV. So right now, it's a little bit of a holding pattern. As I've said before, we're not going to throw other agents and to create the triple combo until we have a great deal of confidence that it's a study worth funding. So in the meantime, we're hunting still.
Operator
Our next question comes from Akash Tewari from Jefferies.
Amy Li
This is Amy on for Kash. So the first question on EDP-323, what percent of the drug is bound to plasma protein in vivo? And additionally, do you expect any safety risk from targeting RNA polymerization? We've seen neutropenia with lumicitabine, but now that's an analog, which is a little different, but would love to hear your thoughts here.
Jay R. Luly
Yes. I don't recall the level of protein binding, but the ratio or the multiples of the EC90 that I quoted earlier, which were ranged between 11 and 44-fold we're already adjusted for that protein binding. So whatever the protein binding is, this is multiples on top of that when you look at it from a free drug perspective. And you're correct, lumicitabine being a new -- a lot of the nukes in the field had issues. NUCs not uncommonly suffer or benefit from, depending upon how you look at it, broad activity across other polymerases and so selectivity can be a problem but EDP-323 is a non-NUC polymerase inhibitor. And so far, preclinical safety was excellent and human safety, in terms of safety and tolerability at least from our Phase I study was also very, very strong.
Amy Li
Great. And then on 235, are there any additional data sets that a potential partner would be looking for to support our collaboration? And then when do you expect to get clarity from a regulatory perspective on path to registration?
Jay R. Luly
So I think right now, we have the clinical data that we have with regards to the SPRINT study. Again, we saw antiviral effect. We saw an effect on symptom improvement so those are the data that we have. And as I mentioned, the regulatory discussions are ongoing. When we'll finish those, they'll be done when we're done with the exchanges. So it's hard for me to put a time point on that right now, but we'll have further updates as we progress.
Amy Li
Great. And then finally, one last one on cash runway. Can you go over the main drivers for you extending runway from 2026 last quarter to 2027 now? Outside of the OMERS royalty sale, are there any other ongoing portfolio prioritization activities that we should be aware of?
Paul J. Mellett
Well, as we've indicated, this is Paul Mellett, we've made the decision to wait for a partnering situation to continue the Phase III work on 235. And that's a significant extension of our runway for the most part, and that's the primary driver. And then obviously, we've not discussed any potential revenue or anything like that from a partnering arrangement. It's just simply the expense-sparing of the Phase III trials.
Operator
Our next question comes from Brian Skorney from Baird.
Luke P. Herrmann
This is Luke on for Brian. First on 323, any consideration with regard to the human challenge study design to maximize potential read-through to real-world populations? And then just a second one on hMPV and RSV, the dual inhibitor. As you finalize selection of that candidate, is there any consideration of potential compromises that make the candidate more or less able to potently inhibit either virus? Or are trade-offs not really a necessity in this situation?
Jay R. Luly
Yes. So 323, this is Jay. 323, the challenge study, again, it's the challenge study, right? It's the right of passage for RSV molecules. Everybody puts them through the challenge study. And for the most part, everybody runs the challenge study in a very similar way so that you can cross-trial comparisons are always never perfect or ideal, but to the extent that you can compare data in this setup, it's helpful to run it in the same way. So not every molecule that goes into a challenge study comes out successfully from a challenge study. So it's not a given, but we view it as a good next step and one that, again, further derisks things because if you come out of the challenge study with really robust data, you know that you have a good antiviral in a human setting. So you put that in your back pocket.
And then with regards to Human Metapneumovirus RSV dual, I'm not sure I fully understand your question. I mean there -- again, we put data out on a prototype. We're aiming to have our final candidate or a candidate finalized in Q4. You can never exactly balance potency. While I suspect you could try to do that maybe for the rest of your life trying to get everything exactly balanced. But that doesn't matter because you always -- whenever you have a broader spectrum drug, there's always a dose-defining pathogen, which is the one that you're the least potent against, knowing that if you dose for that and account for that, then you'll be good against the -- in this case, the other pathogen, which has even greater potency. So we're optimizing different characteristics of the molecule in that program settling down to finalists that we're just doing final characterization on the profile. And then assuming that all goes well, again, we're targeting Q4 as the timing for that candidate selection, final selection.
Operator
We also have a question from [Nick Veltri] with Leerink Partners.
Unidentified Analyst
Hi, everybody. This is [Nick Veltri] on the line for Roanna Ruiz. Maybe first off, on your RSV program. Which 323 doses are you planning to evaluate in the upcoming challenge study? I don't know if you've mentioned that. And maybe also, I guess, what learnings from the development of 938 so far, could you apply to a possible future development of 323 are you planning to go after similar patient populations for 323 or could you explore other populations as well?
Jay R. Luly
Yes. So we haven't disclosed the final doses for that study. We're likely to do that in connection with the announcement of the initiation of the study. So stay tuned for that. Again, we're aiming for early Q4. But suffice it to say, there will be doses within the ranges that we've studied. We're really trying to just figure out what optimal doses for various exposures that we want to try to hit and look at the product profile overall.
And then with regards to 938, I mean we've learned a lot about RSV through the use of 938 and I can only imagine that we'll have a more targeted expedient pathway for 323 based on our learnings, whether it was what we learned in the standard risk patient population, which is that patient population doesn't need a drug. And then through the recruitment of our 3 high-risk patient populations, there's very interesting teachings in each of those patient populations that you can only figure out once you get into them. And we've learned a lot along the way with 938. So exactly the trial after the human challenge study, that's something that we're thinking about very diligently right now but not ready to speak to today.
Unidentified Analyst
Got it. And also, are you planning to pursue or evaluate 323 in similar patient populations? Or would you explore other types of patients as well?
Jay R. Luly
Well, those are the 3 high-risk patient populations. PEDs probably the largest patient population from a market perspective, high-risk adults and immune-compromised patients of different flavors. I mean we've chosen, from immune compromise, we at least in RSVTx with 938, we've zeroed in on hematopoietic stem cell transplant, but there's other immune invasion populations, immunosuppressed patient populations that one could also consider but anyway, you want to be in a high-risk patient population of one flavor or another, if you really want to get it over the finish line.
Operator
And I'm showing no further questions at this time. I'd like to turn the call back over to Jennifer Viera for any closing remarks.
Jennifer Viera
Thank you, operator, and thanks to everyone for joining us today. If you have additional questions, please feel free to contact us by e-mail or call us at the office. Thanks so much, and have a good night.
Operator
This concludes today's conference call. Thank you for participating. You may now disconnect.
