Albireo Pharma, Inc.
Q1 2018 Earnings Call Transcript

Published: 17 May 2018

[Operator:]

Greetings and welcome to Albireo’s First Quarter 2018 Earnings Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions]. As a reminder this conference is being recorded. I would now like to turn the conference over to Paul Arndt. Sir, you may begin.

[Paul Arndt:]

Thank you operator and good morning everyone. Thank you for joining today’s call during which management will provide an update on Albireo’s performance in the beginning of 2018. Earlier today, Albireo issued a press release highlighting a recent business accomplishment and noting its financial results for the first quarter. The press release is accessible via the Company’s website at www.albireopharma.com. Before proceeding, let me mention that comments today may include forward-looking statements under the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements other than statements of historical fact regarding the plans for or progress, scope, cost, duration or results of development of A4250, elobixibat, A3384 or any other Albireo product candidate or program, including the target indications for development, size, design, population, location, conduct, objective, duration, endpoints, timing for initiation or completion thereof or for reporting of results from or regulatory feedback regarding any clinical trial, including Albireo’s Phase 3 trial of A4250 in patients with PFIC. The commercial outlook for any Albireo product candidate or program or opportunity in any target indication, any additional payment that HealthCare Royalty Partners or EA Pharma may make to Albireo, the period for which Albireo’s cash resources will be sufficient to fund its operating requirements, or Albireo’s plans, expectations, or future operations, financial position, revenues, costs or expenses. Actual results may differ materially from those expressed or implied by any forward-looking statement as a result of many factors including those described under the heading Forward-Looking Statements in Albireo’s press release from earlier today or under the heading Risk Factors in its most recent Form 10-K or in later fillings with the SEC. Albireo cautions you not to place undue reliance on any forward-looking statement. Also, any forward-looking statement that is made speaks only as of today, Thursday, May 17, 2018 and should not be relied upon as representing Albireo’s views as of any future date. Albireo disclaims any obligation to update any forward-looking statement, except as required by applicable law. With that, I’ll turn the call over to Ron Cooper, Albireo’s President and CEO. Ron.

[Ron Cooper:]

Thank you Paul and thank you everybody for joining today's conference call. With me today is Tom Shea, Albireo's Chief Financial Officer and Paresh Soni, Chief Medical Officer. Albireo achieved a major milestone recently enrolling the first patient in PFIC 1 our Phase 3 clinical trial in progressive familial intrahepatic cholestasis or PFIC. This is a major step forward in our quest to bring a new medical treatment to people living with PFIC and their families as well as for our company. We are very excited and I'm proud of our team at Albireo for this wonderful accomplishment and on delivering our guidance of a spring 2018 Phase 3 trial initiation. The Phase 3 program includes a single randomized double blind placebo controlled multicenter clinical trial designed to enroll approximately 60 patients with PFIC type 1 or type 2 and an open label extension study to assess long-term safety and durability of response. The placebo controlled trial will evaluate two doses of A4250 for 24 weeks. The change in price will serve as the primary endpoint for FDA evaluation and a key secondary endpoint for EMA evaluation. The serum bile acid responder rate will serve as the primary endpoint for EMA evaluation and a key secondary endpoint for FDA evaluation. Our team continues to work expeditiously to activate all of the clinical trial sites around the world. We currently expect data to be available around the end of 2019 or early 2020. The Phase 3 trial and available data from the extension study are expected to form the primary support for drug approval applications for A4250 in the U.S. and EU for the treatment of patients with PFIC. We anticipate additional evidence will come from an independent research study that is pooling and analyzing long-term historical PFIC patient data to provide insight into the natural history of the disease and potential correlations with biomarkers. Interim data from the natural course and prognosis of PFIC and effect of biliary diversion study also known as NAPPED were presented at the European Association for the Study of Liver, EASL and the 51st European Society for Pediatric Gastroenterology, Hepatology, and Nutrition or ESPGHAN meeting. These interim data demonstrated that there was a statistically significant difference in survival with native liver, P value of 0.001 for PFIC 2 patients who had biliary surgery versus those who did not. The NAPD [ph] consortium is an international study group working to characterize the natural history of PFIC types 1 and 2 and is supported by an independent grant from Abireo. Also the EDPGHAN Meeting additional data were presented from a systematic literature review, a partial external biliary diversion or PEBD surgery in patients with PFIC. It's found that changes in serum bile acid and bilirubin appear to be useful biomarkers in predicting both early and long-term outcomes for patients with PFIC. Also at EASL we presented new data from our previously disclosed exploratory Phase 2 trial of A4250 in children with cholestatic liver disease and pruritus. The analysis show that there was an association between a reduction in serum bile acids and a decrease in autotaxin levels, plus ataxin has been implicated in the mechanism of pruritus. This is very encouraging particularly given the correlation between reduction in serum bile acid and pruritus that was observed in this study. At EDPGHAN we presented a qualitative study on the substantial impact that pediatric cholestatic liver diseases such as PFIC have on quality of life. These findings were generated during the development of the proprietary patient reported outcome or PRO and observer reported outcome or ORO tools that were used to measure pruritus in our Phase 3 study. We believe that A4250 has the potential to become a useful therapeutic agent for physicians in the treatment of pediatric cholestatic liver diseases should our Phase 3 study be positive and we intend to generate data and information beyond our Phase 3 progress in PFIC to support its expanded use. We believe that PFIC may be the first place where A4250 can have benefit and it is a priority for us to evaluate the potential use of our product candidate in other cholestatic liver diseases. Let me now move to elobixibat. In the first quarter we announced that our licensee EA Pharma received regulatory approval in Japan for the world's first approved IBAT inhibitor elobixibat for the treatment of chronic constipation. Just prior to the approval we had announced an agreement with a leading healthcare investment firm, Healthcare Royalty Partners to monetize our royalty rights to elobixibat for Japan under our license agreement with EA Pharma on approval. The Japanese approval triggered more than $55 million in payments to us between healthcare royalty and EA Pharma and we are eligible for an additional $15 million under the healthcare royalty agreement, the specified sales milestone is reached. Moreover we regain our royalty eligibility under the EA Pharma agreement if healthcare royalty receives maximum amount of 175% of this amount paid to us. Now perhaps more significantly, the approval of elobixibat was the first approval of an IBAT inhibitor anywhere in the world. Our scientists have been working on bile acids for a couple of decades now and the approval of elobixibat provides further validation of the potential impact of the Albireo bile acid modulation platform. A4250 is a different IBAT inhibitor that comes from this platform as well as our preclinical bile acid modulators or NASH Speaking of NASH studies have indicated that patients with Nonalcoholic Steatohepatitis have elevated bile acid levels, elevated cholesterol, insulin resistance, liver inflammation, and liver fibrosis. Clinical findings of elobixibat indicate a potential beneficial impact on the parameters of elevated LDL cholesterol and GLP-1 which has been linked to insulin resistance and preclinical findings with another IBAT inhibitor indicate a potential impact on liver inflammation and fibrosis. Also IBAT inhibitors have been shown to be protective of NASH in preclinical models. Therefore we are taking a two pronged approach to NASH that includes a potential Phase 2 study with elobixibat and a preclinical program with novel bile acid modulators. We're considering initiating a Phase 2 trial with elobixibat in the first half of 2019. With this two pronged approach we believe we have the makings of a compelling NASH program. Our third clinical stage product candidate A3384 is a proprietary formulation that is designed to overcome the limitations of an established bile acid sequestrant known as Cholestyramine by releasing it directly in the colon to treat bile acid malabsorption or BAM. If our pending formulation related patents for A3384 issue in the United States, we are considering taking the optimized formulations into the claim to evaluate it as a treatment for BAM. If we decide to do so we would expect to start an A3384 trial in the first half of 2019. If we are able to achieve success in the clinic and obtain regulatory approval A3384 could be the first treatment approved for bile acid malabsorption in the United States. Lastly we're well funded to execute on these plans. In Q1 we raised just over $94 million in net proceeds from equity transactions and an additional $55 million in non-dilutive financing and this collectively has strengthened our financial position and provided a solid foundation for our pipeline. Cash and cash equivalents totaled 192.9 million at March 31, 2018 compared with 53.2 million as of December 31, 2017, an increase of 139.7 million. Based on current operating plans Albireo expects that its current cash resources will be sufficient to meet its operating requirements at least into 2021. So to summarize, we are tremendously excited to be underway with the PFIC 1 Phase 3 trial bringing hope to people with PFIC and their families. We are also pleased to have the first approved IBAT inhibitor worldwide now launched in Japan for chronic constipation. We continue to present data offering deep insight into PFIC and we are focused on advancing our pipeline into other cholestatic liver diseases and beyond. I'll remind you that I'm here with Paresh Soni, CMO and Tom Shea, CFO and we would be happy to take any questions that you might have. Operator.

[Operator:]

[Operator Instructions]. Our first question is from Ritu Baral with Cowen and Company. Please proceed.

[Ritu Baral:]

Good morning guys, thanks for taking the question. Ron, how are you thinking about that two doses in the PFIC Phase 3, do you think there might be a commercial and clinical place for both of them and how do they figure into the stat plan, is the primary analysis both doses versus placebo or is it one dose in a sequential analysis?

[Ron Cooper:]

Hi Ritu, thanks very much for the question. I think the two doses was a big decision for us but I think it's one that we think increased our probability of success. Our intention is actually to commercialize only one dose so we plan to go forward with that and we feel it's probably the 120 microgram per kilogram. So we have two doses 40 and 120 that are within the doses that we studied within Phase 2. And the reason we decided to go with the two doses is that we were actually surprised with the lower doses, how much efficacy we had. So, it really is a bit of a backup plan to have the second dose. Paresh you want to talk about dose analysis.

[Paresh Soni:]

Yeah sure, hi Ritu, thanks for the question. So we have designed the program such a way that we can test each dose against placebo and not have to do sequential testing. So even if one of the doses does not meet the primary endpoint we can still test the other dose. And we've intentionally designed it that way to increase our probability of success.

[Ritu Baral:]

Very helpful and then for my follow-up I just wanted to ask you about how you're looking at the potential NASH Phase 2 for elobixibat at least when you think about the mechanism Paresh, do you believe that your effect would be primarily on the information or primarily on fibrosis and how does that impact how you're thinking about structuring endpoints in the Phase 2? I will hop back in the queue thanks.

[Paresh Soni:]

So, like most early Phase 2 studies in NASH the first thing we have to show is that we can have an improvement in liver fat or steatosis and we'll design the study in a way that we want to show that in the short term with a few months of therapy we can improve a lot of fat in a way that is significant compared to placebo. And of course as you've seen from many of the recent studies coming out, that if you get improvement in liver fat that tends to lead to improvement in inflammation and fibrosis. So we're not going to be measuring things like fibrosis in liver biopsy study in early Phase 2 but we will look at fibrosis markers and inflammatory markers but the primary intention is to show an improvement in hepatic steatosis. Now having said that in our preclinical models we have shown improvement in all of those factor in steatosis, inflammation, and fibrosis. And we've shown with elobixibat that we have several metabolic improvements that are very beneficial in the NASH setting and insulin resistance setting and that includes reduction in LDL cholesterol, increase in GLP-1 for example. So -- but these are short term studies, obviously we need to do longer-term studies to show that the end results are in improvement in fibrosis.

[Ritu Baral:]

So, that sounds like PDEF study rather than a biopsy study?

[Paresh Soni:]

For early Phase 2 we think that's probably the best way to go.

[Ritu Baral:]

Got it.

[Ron Cooper:]

We are still working our way through that right now. We are spending a lot of time with key opinion leaders and I think what we are getting back from them is what are they thinking about safety first and then efficacy. And when they look at our bile acid modulation approach to things what they are particularly excited about is that our non-systemic approach oral therapy not an injection therapy, but potential for low off target effect, the potential for interactions with other drugs relatively low. So we are pretty excited about that. And then when we start to show them as Paresh has said, some of the clinical data with elobixibat on the metabolic markers and then if you look at some of the pre-clinical models that look at fibrosis and inflammation they get pretty excited about that package. So our intention or development plan is to highlight all of those aspects but as Paresh has said our first foray will be something that kind of put's that together and looks at some of the early markers but we're still working through that. Thanks for the question.

[Ritu Baral:]

Okay, that's helpful. Thanks for taking them.

[Operator:]

Our next question is [indiscernible] with Jefferies. Please proceed.

[Unidentified Analyst:]

Thank you. So the Phase 3 study introduced against the placebo, so you think that 20 patients in each arm is sufficient to show statistical significance and if so can you talk about your powering assumptions?

[Paresh Soni:]

So, hi, thanks for the question. Yes, we have had -- we've done quite a bit of work on the Phase 2 data and other data that's been published. And we believe treating patients a group is enough. Power is actually to show an improvement for both endpoints, both the serum bile acid responder and the pruritus change. And we have more than 80% power of both those end points to show a difference from placebo in a six month time. So, remember that our Phase 2 study that we presented was only four weeks and this will be a longer study. We haven't disclosed our powering assumption at this point in time so I can't really comment on that. But we're very confident that with 20 patients per group in fact we have sufficient power and maybe even slightly overpowered by one of the endpoint. So we're very, very comfortable with that.

[Unidentified Analyst:]

Thank you and then in the U.S. and EU the primary endpoint is different, so Ron mentioned a key secondary endpoint in each territory, so do you have to hit the key secondary endpoint as well for approval in Europe?

[Ron Cooper:]

Thank you Yu for the question. And I think actually the bigger question for us is actually the dialogue we've had with both authorities, right. And both authorities have said to us the totality of the data is going to be important. So both the primary and the secondary endpoints and the direction of travel plus -- and particularly for the Phase 3 study so, but they will also want to have data from the extension study, whatever data we have when we submit that we will have some patients that will be on therapy for at least two years at that time. And then as I said in my prepared comments some data on the natural history as well which we hope the NAPD [ph] group would be able to generate for us. So those are all the aspects that will go into our regulatory submission. And I think to answer your question directly in regards to primary and secondary, obviously the premium point in each part of the world be imported but they have also indicated to us the secondary import -- endpoints to sell will be important as well.

[Paresh Soni:]

And just to add Yu, the regulators are really looking at the totality of the data that emphasizes to us. So, for example if you see an improvement in pruritus but the liver disease gets worse over time obviously that will raise that question. So they really want to see everything moving in the right direction, that's what they are more interested in looking at in this ultra rare reputation.

[Unidentified Analyst:]

For the secondary -- key secondary endpoint P value is 0 or less than 0.025?

[Paresh Soni:]

Yes, it will be the same.

[Unidentified Analyst:]

Okay, thank you.

[Operator:]

Our next question is from Katherine Xu with William Blair. Please proceed.

[Katherine Xu:]

Yeah hi, good morning. I'm just wondering about the IBAT study presented at EASL, it looks like the PFIC 1 patients on the PEBD surgery had less of the impact as compared to the PFIC 2 patient, so I just wonder how you take that into account your Phase 3 design because you're including both PFIC 1, PFIC 2 patients and if PFIC 1 does not respond to a A4250 as significantly as PFIC 2 patients then how would the label look like?

[Ron Cooper:]

Yeah, thanks for the question Katherine. I think when you go to PEBD surgery and if you look at studies in PEBD surgery that look at the different forms of PFIC 1 and 2 you actually see that there is efficacy there. What you are referring to is the interim results from the NAPD [ph] group which was presented at EASL and in dialogue with them you remember that the interim result and they actually don't feel that they have enough data in the PFIC 1 group as yet. So, we look forward to them completing that study and then once they have sufficient data we will make the appropriate conclusions. But we feel pretty confident of the effect of the drug A4250 across the various types of PFIC.

[Paresh Soni:]

And in addition to that Katherine we also study for PFIC 1 and 2 across the retreatment groups just to ensure that we don't get an imbalance of PFIC 1 in any group.

[Katherine Xu:]

Thank you.

[Ron Cooper:]

Thanks for the question Katherine.

[Operator:]

Our next question is from Yasmeen Rahimi with ROTH Capital Partners. Please proceed.

[Yasmeen Rahimi:]

Good morning team and congrats on rolling out the Phase 3 study, so request two questions on that. Question one is do you have an inclusion criteria that involves a minimum explore? And then the second question is can you give us a little bit more guidance on the site in U.S. which is the site that is considered to have the largest PFIC patients?

[Ron Cooper:]

So I will start with the sites and Paresh and perhaps you can talk about the score. So remember that PFIC itself is on recessive disease. There tends to be some clusters where there's continuity around the world. So if you look at that there are some clusters in some of the Middle East countries. There's some cutters in Northern Europe in particular and then there's clusters in the Northeast area of the United States based on some of the population. And then of course there was a fair bit of immigration [indiscernible] so that immigration drives patients in different areas. So it's not even distribution around the world and so that as a result you have some clusters and then some spring distribution of patients around the world. Paresh.

[Paresh Soni:]

Hi Yasmeen, thanks for the question. Yes, we do have a minimum criteria or severity of pruritus for patients prior to getting randomized into the study and that's calculated during the screening period when they fill in the electronic diary. And we've done some -- quite a bit of work on that on developing the tool and validating it with the patients and the caregivers and determined what the threshold is for inclusion. I don't think we've disclosed that as yet so unfortunate at this point I can't really disclose. But we hope to publish that and submit that to a major scientific meeting soon. And I just want to preempt that by giving the threshold at the moment for what the inclusion criteria is. But of course we need to ensure they have -- we have enough pruritus at the beginning so that we can detect a change over a six month period.

[Yasmeen Rahimi:]

Thank you so much and then Paresh maybe one question, can you give us any update on the current logic study that is ongoing, that you are supposed to be reading out in 2019, do you have a little bit more insight on this very large natural history study that is currently in play?

[Paresh Soni:]

So unfortunately I don’t know any -- much more than what you know Yasmeen. That study has been going on for a long time as you know and it is not our study, it is done by the NIDDK and they have not disclosed in detail how many patients they have and when they hope to actually release the data. We have asked them that many times and I think they are working on that. I think as you know this network is up for renewal every five years or three years and I think they are going through the process at the moment before they make those decisions. I can't really comment on that unfortunately.

[Yasmeen Rahimi:]

Great, thank you so much.

[Ron Cooper:]

Thanks Yasmeen.

[Operator:]

Our next question is from Liana Moussatos with Wedbush Securities. Please proceed.

[Liana Moussatos:]

Thank you for taking my questions and congratulations on your Phase 3. The Phase 3 is designed for ages six months to 18 years, can you remind us about PFIC symptoms from newborn to six months and are you planning to do any kind of safety work or any kind of trial work in that age group? And then for the second indication are you thinking Alagille or one of the other pediatric liver diseases?

[Ron Cooper:]

So the design -- so thanks for the kind comments Liana, we are pretty excited to be up and going. I think that one of the things that makes our mechanism attractive first of all is there is no pharmacological treatment that's approved for these children. So that makes it attractive but then on top of that the fact that we have a non-systemic approach oral medication that has a potential for low off target effects makes it attractive. So given the design that's why we're treating young children, right and we feel pretty, pretty good about the safety profile. I think that as these patients present the difference about our disease versus other ultra rare diseases they present with symptoms pretty early in life. They present with a failure to thrive, they don't grow and they begin to be quite prolific quite easily. And so, in that time frame of the six months to the early years we expect to see the patients come into the studies. So, if you look at our Phase 2 study and the means around three years for us we expect probably three to five years will be four for those patients. And then comment on the second indication, that's something that we're being pretty careful about. Paresh and the team has had a good dialogue with our key opinion leaders. We know that in our Phase 2 study we showed some promising data in both Alagille patients, the liver atresia patients and some other types of patient population. What we're really trying to do is just understand what makes the best sense from a patient population -- sub patient population endpoint length of study and those types of things. Anything you want to add Paresh.

[Paresh Soni:]

Yeah, just to add, I mean we are starting at six months of age in the Phase 3 study but as far as pediatric investigational plan later on we will be studying patient in the first year of life. But of course it will not be a robotic event study in the way the Phase 3 is designed. It's more to get experience in that age group. In terms of safety, we do have a DSMB and that will be meeting regularly and reviewing the safety data, if there is any signal they will let us know. So we have thought about that and we just want to be cautious to make sure that we are covering that because these patients can be quite sick. So, thanks for the question.

[Operator:]

Our next question is from Alan Carr with Needham and Company. Please proceed.

[Alan Carr:]

Hi, thanks for taking my questions and congratulations on the Phase 3 start. I have a couple, what are your expectations in terms of ratio of PFIC 1 to PFIC 2 patients enrolment in the Phase 3? And then also around your plans in NASH as you highlighted today, plan on taking elobixibat into Phase 2 but you also brought up an earlier stage program, do you plan to develop a couple of these in parallel or is it an either or situation? And third one is should we expect the OPEX to stay at a similar rate from the first quarter over the rest of the year and should we expect a ramp up in the second through fourth quarter because of the Phase 3 starts? Thanks.

[Ron Cooper:]

Thanks for the questions Alan. Let me start with the NASH one and I will hand over to Paresh to talk about PFIC 1 and 2 and then Tom can close up on OPEX. I think our strategy is a two pronged approach. I think that we feel pretty lucky to have a compound like elobixibat which has been approved in Japan. We have over 1500 patient exposures, there are tremendous amount of safety data behind that. That makes us pretty confident in going into a Phase 2 study and as we spoke earlier the rationale for a bile acid modulation approached pretty strong given that we impact with the key parameters that are known for NASH. And then the idea is that from the same platform our scientists have been working in bile acids for a couple of decades. So elobixibat comes from that platform, A4250 comes from that platform, and our preclinical mash compounds are also from that platform. And so we are encouraged by the early signs and what we see with those preclinical compounds. But it's too early to say as to how many compounds will come out of that and what actually will come from it. But I think the two pronged approach makes us pretty comfortable that we should have something interesting in NASH overtime. Paresh.

[Paresh Soni:]

Thanks Alan, I will take the PFIC 1 versus PFIC 2 question. So, we have looked at the literature and we have looked at the interim data that's come out of the NAPD [ph] study through the independent academic consortium. And talked to many prescribers to what the ratio is in PFIC 1 and PFIC 2. And where we have landed is that we think about 15% of the patients of the PFIC 1, the vast majority will be PFIC 2 in our study. And obviously -- and that's partly why we've stratified across the treatment groups so that we have an even distribution of PFIC 1 and 2 patients across the treatment groups. But we don't think it'll be more than 15% based on what's known so far. So I will hand over to Tom for the OPEX question.

[Tom Shea:]

Yes, hi Alan. And on the OPEX we had about 12 million in operating expense for the first quarter. We are guiding for 45 to 50 for the year. So I do anticipate call it 2 to 4 should be in line with what we are seeing in Q1 here.

[Alan Carr:]

Thanks. Ron, a follow-up on your comments on the NASH program. You have praised the early programs of bile acid modulator rather than IBAT inhibitor, are you planning to develop something with a different mechanism of action so that it would be appropriate to bring two different compounds forward in parallel because they have different mechanisms of action or are these earlier compounds also IBAT inhibitors and you may face a decision at some point between picking one or the other for later stage development, thank you?

[Ron Cooper:]

Yeah, thanks for the question Alan. I think it is a little bit too early for us to answer that question. So the teams are working on multiple compound, so I think when we have a better line of sight we will be able to disclose a little bit more on that space. But we are excited about the potential of what the team is working on.

[Alan Carr:]

Great, thanks for taking my questions.

[Operator:]

[Operator Instructions]. Our next question is from Matt Kaplan with Ladenburg Thalmann. Please proceed.

[Matthew Kaplan:]

Hi, good morning guys. Let me add my congratulations on getting the Phase 3 underway, major milestone for the company obviously. Wanted to focus on the Phase 3 a little bit more, I guess maybe a question for Paresh, can you talk a little bit about the two endpoints, the primary and secondary in terms of the magnitude of change you're looking to achieve in sBA serum bile acid and also talk a little bit more about your pruritus scale and what you're hoping to achieve there and at the components of that pruritus now?

[Paresh Soni:]

Hi Matt, thanks for your comments and for the question. So for the serum bile acid responder rate, so we're looking at the proportion of responders in each treatment group versus placebo. So it is basically a binary endpoint. And we are looking at a 70% reduction in serum bile acids on baseline compared to the placebo group and it achieved a 70% responder classified as a responder. And if they don't they're not. Or it could be to a certain threshold somewhere between 50 and 100, we haven't disclosed the exact number yet but between 50 and 100 and this is looking at literature data and looking at PEBD surgery in large numbers of patients, more than 100 patients and looking at what constitutes a clinical response in terms of a serum bile acid change. In terms of pruritus scale we've spent a long time developing that scale, worked very closely with expert groups and with the FDA clinical outcome assessment group and the EMA and come up with what we believe is a very robust scale and very easy to understand by caregivers and by patients. And what we need to see there is a change from baseline overtime between the screening period which is a few weeks of measurement of morning and daytime each, sorry, daytime and nighttime each and looking at that overtime. As a change from the baseline, so it is not a responder analysis. This is actually where we are at the moment and we think that that will give us a really good change over time. And of course the study is going to be six months long, so it is much longer than what we've had for our Phase 2 study. In four weeks they're using three different scales, we showed none of them were designed for cholestatic pruritus in kids. We saw a change in four weeks so we are doing a longer study at 24 weeks and we hope to see more of a stabilization and then a greater separation from placebo.

[Ron Cooper:]

I think Matt, characterize that versus the Phase 2, I think you know when Phase 2 we showed a very good reductions in bile acids and we showed an improvement in pruritus against three different scales but to Paresh's point I think in Phase 3 what's great is first of all we mentioned the same things, right, so we are not changing what we looked at Phase 2. And then the way that we measure them I think is refined, right. So if you look at it from a pruritus perspective we used three general scales, now we have a proprietary tool that we have tested with children and their parents. So we feel good about that and then to Paresh's points, we certainly dug in on the serum bile acids to sort of refine the way that we measure that as well. So we feel pretty good [of being at] both endpoints in the way we measure them in Phase 3.

[Matthew Kaplan:]

Okay, great, that's helpful and then couple of follow-ups, in terms of talking a little bit about the timeline for the Phase 3 how many sites do you plan to have in total and I guess how many sites do you have up now and how many sites do you expect to have by year-end?

[Ron Cooper:]

Yeah, so thanks for that question Matt. We anticipate somewhere between 35 to 45 sites that will be [down] for this study. We haven't disclosed how many sites we have up and going and the timing behind it. I think that really is the rate limiting aspect of getting the study moving. We have had our CRO in place at the end of 2016 and we've done a pretty good site feasibilities. So we have a good idea of where the patients are. But it's multiple countries and it's multiple sites and so really right now the team is working through the administrative part of getting phase up and going through IRRBs, regulatory authorities, contracts, and all of those things.

[Matthew Kaplan:]

Okay, thanks and then just thinking about other indications for A4250 what's your strategy. I guess you addressed this a little bit but for Alagille and biliary atresia syndrome and other indication for A4250? And then last question would be current update on 3384 and I guess where are you in terms of finalizing them or optimizing formulation for that?

[Ron Cooper:]

I think -- thank you for those questions Matt. I think to characterize where we are as a company in the A4250 PFIC 1 study and the program itself is the largest priority and we've pretty much taken all of our organizational resources behind driving that. And now a big part of our team will be working to activate more of the sites. In the background we've had a couple of smaller pods working both on A3384 and what we're doing with the other indications. We've given you guidance that A3384 we anticipate to start in the first half of 2019 and for the other indications in 2019. And we've left you with pretty wide guidance because frankly what we need to do is to move those up a little bit up to the front burner a little bit. But we will only do that carefully when we're really confident that we're really clicking on all cylinders of the A4250 PFIC 1 and 2 studies. And so what's rate limiting in both of those for the other indications just getting deeper insights from our key opinion leaders to make sure we do the right trial there to show the right endpoints. And for A3384 we are gated against a patent that we're looking for. Once we have that patent we will be up and going as well but in the meantime there are small parts that are doing work to get us ready for those events.

[Matthew Kaplan:]

Great, thanks a lot.

[Operator:]

Ladies and gentlemen we have reached the end of our question-and-answer session. I would like to turn the floor back over to management for closing remarks.

[Ron Cooper:]

Alright thank you operator. So just to summarize we are very excited to be underway with the PFIC 1 Phase 3 trial bringing hope to people with PFIC and their families. We are also delighted to have the first IBAT inhibitor approved in the world and now launched in Japan and as well to have the financial resources to execute on our plan. So I thank you all for tuning in today and really appreciate the questions, thank you.

[Operator:]

Thank you, this concludes today's conference. You may disconnect your lines at this time. And thank you for your participation.