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Arrowhead Pharmaceuticals Inc (NASDAQ:ARWR)
Q1 2019 Earnings Conference Call
February 7, 2019, 4:30 p.m. ET

Contents:

Prepared Remarks:

Operator

Ladies and gentlemen, welcome to the Arrowhead Pharmaceuticals conference call. Throughout today's recorded presentation, all participants will be in a listen-only mode. After the presentation, there will be an opportunity to ask questions. I will now hand the conference call over to Vincent Anzalone, Vice President of Investor Relations for Arrowhead. Please go ahead, Vince.

Vince Anzalone -- Vice President of Investor Relations

Thanks, Lauren. Good afternoon, everyone. Thank you for joining us today to discuss Arrowhead's results for its fiscal 2019 first quarter ended December 31st, 2018. With us today from management, our President and CEO, Dr. Christopher Anzalone, who will provide an overview of the quarter, Dr. Bruce Given, our Chief Operating Officer and Head of R&D, who will discuss our clinical programs, and Ken Myszkowski, our Chief Financial Officer, who will give a review of the financials. We will then open up the call to your questions.

Before we begin, I would like to remind you that comments made during today's call contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact, including without limitation those with respect to Arrowhead's goals, plans, and strategies are forward-looking statements.

These include statements regarding our expectations around the development, safety and efficacy of our drug candidates, projected cash runway, and expected future development activities. These statements represent management's current expectations and are inherently uncertain. Thus, actual results may differ materially. Arrowhead disclaims any intent and undertakes no duty to update any of the forward-looking statements discussed on today's call.

You should refer to the discussions under risk factors in Arrowhead's annual report on Form 10-K and the company's subsequent quarterly reports on Form 10-Q for additional matters to be considered in this regard, including risks and other considerations that could cause actual results to vary from the presently expected results expressed in today's call.

With that said, I'd like to turn the call over to Christopher Anzalone, President and CEO of the company. Chris?

Chris Anzalone -- President and Chief Executive Officer

Thanks, Vince. Good afternoon and thank you for joining us today. 2018 was a very productive year for us. A year ago, we were preparing to start first in human clinical studies for the first two candidates built on the TRiM platform. Today, there are five candidates either in or approaching the clinic.

ARO-HBV against chronic hepatitis B infection is in a Phase 1-2 study and is partnered with Janssen. ARO-HBV will now be referred to as J&J 3989. A second candidate is ARO-AAT against a rare genetic liver disease associated with alpha-1 antitrypsin or AAT deficiency, which has completed a Phase 1 study. We are actively working with the FDA to get feedback on potential influence and design of our next study.

The third candidate is AMG 890 against cardiovascular disease and is partnered with Amgen. Amgen is evaluating AMG 890 in a Phase 1 study to assess safety, tolerability, pharmacokinetics, and pharmacodynamic effects. The fourth candidate is ARO-ANG3 against dyslipidemia in a Phase 1 study in healthy adult volunteers and dyslipidemia patients.

A fifth candidate is ARO-APOC3 against hypertriglyceridemia. I'm pleased to announce that we have received ethics approval and now await regulatory feedback on our planned first in human Phase 1 study of ARO-APOC3. We are prepared to begin the trial rapidly once all necessary approvals have been received.

That is impressive progress to go from zero to five clinical programs all built on the TRiM platform in just 12 months. In fact, we have exceeded virtually all of the aggressive development goals that we set in 2018 and I believe that we are the fastest and most innovative company in the RNAi field.

As productive as 2018 was, 2019 has the potential to be even more so. Let's talk about some of our goals and expectations for calendar 2019. They are one, complete dosing and report data from the Phase 1 study of ARO-ANG3, two, complete dosing and report data from the Phase 1 study of ARO-APOC3.

Three, present additional Phase 1-2 data from J&J 3989, formally ARO-HBV. To that end, we already have accepted presentations at the Asian Pacific Association, a study of the Liver Meeting in February, and the EASL International Liver Congress in April. We expect additional abstracts to be submitted throughout the year. Note that the abstracts use the name of the compound, JNJ-3989 rather than the old name, ARO-HBV.

Four, begin a Phase 2 study or studies of ARO-AAT and we hope to provide clarity on a potential path to commercialization. Five, file a CTA for our first inhaled pulmonary program, ARO-ENaC against cystic fibrosis. Six, file a CTA for our first solid tumor program, ARO-HIF2 against renal cell carcinoma. Seven, discuss additional programs we are developing using the TRiM platform. Eight, we also anticipate that Amgen may share initial clinical data on AMG 890 later this year or in early 2020.

This is a lot in a short amount of time, but Arrowhead has a proven track record of accomplishing what we set out to do. It also speaks to the growing maturity of the TRiM platform. To review, the TRiM platform is built around structurally simple conjugates that utilize ligand-mediated delivery and stringent bioinformatics. The TRiM platform also offers several potential competitive advantages, including a sophisticated RNAi trigger selection and screening process that identifies potent sequences rapidly in locations that RNAi competitors may miss.

Multiple routes of administration, including subcutaneous, intravenous, and inhaled, potentially faster time to clinical candidates, optimized pharmacologic activity and long duration of effect allowing infrequent dosing, potentially wide safety margins, simplified manufacturing at reduced costs, and the promise of taking RNAi to tissues beyond the liver, which will represent a big leap forward for the field a substantial competitive advantage for Arrowhead.

The data that we presented at the AASLD Liver Meeting for November 2018 for our first two TRiM-enabled candidates, ARO-AAT and ARO-HBV, have been very encouraging. They are both proving to be potent molecules with a long duration of effect.

For example, three monthly doses of 300 milligrams of ARO-AAT led to reductions in serum alpha-1 antitrypsin to below the level of quantitation in 100% of subjects. Deep reductions were sustained for greater than 14 weeks, indicating that quarterly or less frequent dosing appears feasible.

ARO-HBV achieved a mean reduction in S-antigen of 1.9 logs or 98.7% with a range of 1.3 logs or 95% to 3.8 logs or 99.8%. In addition, ARO-AAT and ARO-HBV appear to be well-tolerated at all doses tested. This bodes well for these candidates and potentially for the rest of our TRiM-enabled pipeline.

With that overview, I would now like to turn the call over to Bruce Given. Bruce?

Bruce Given -- Chief Operating Officer and Head of R&D

Thank you, Chris. Good afternoon, everyone. Since we are just starting the clinical programs for ARO-ANG3 and ARO-APOC3, I want to spend some time describing these candidates and the current clinical studies. Despite all of the progress with cardiovascular drugs over the past years and decades, atherosclerotic cardiovascular disease remains a major cause of death. While the current standard of care is effective at lowering LDL cholesterol in the vast majority of patients, large well-run trials continue to show substantial unmet medical need for risk modifying therapies with novel mechanisms of action.

Hypertriglyceridemia and elevations in triglyceride-rich lipoproteins have been shown to be important causal risks for atherosclerosis, independent of LDL cholesterol. Elevated triglycerides can lead to highly dangerous pancreatitis, may participate in hepatic steatosis, and are seen in metabolic syndrome. Metabolic syndrome is a complex of interrelated risk factors for cardiovascular disease and type 2 diabetes mellitus.

Let's start with ARO-ANG3, Arrowhead's subcutaneously administered RNAi therapeutic targeting angiopoietin-like protein 3 or ANGPTL3 being developed as a potential treatment for patients with dyslipidemias and metabolic diseases. ANGPTL3 as emerged as an important regulator of plasma lipoprotein levels, including triglycerides, LDL cholesterol, high-density and lipoprotein cholesterol, and very low-density lipoprotein cholesterol. By inhibition of enzymes, including lipoprotein lipase and endothelial lipase.

ANGPTL3 may also be involved in regulating apolipoprotein B particle-containing synthesis and hepatocyte clearance of LDL cholesterol. This is important. Through mechanisms independent of the low-density lipoprotein receptor. This feature of LDL receptor independents is potentially very important. It makes ANGPTL3 inhibition potentially novel and interesting as a therapeutic, receptor-deficient hypercholesterolemic patients.

Intrahepatic targeting of ANGPTL3 may also improve hepatic steatosis, which can progress to non-alcoholic steatohepatitis or NASH. Human genetic studies indicate that ANGPTL3-deficient homozygotes showed lower serum insulin, lower serum glucose, and improved measures of insulin resistance compared to non-carriers.

Given how often atherosclerotic cardiovascular disease and diabetes intersect, these effects seen with ARO-ANG3 would be welcome. Our first in human study, ARO-ANG1001 is a Phase 1 single and multiple-dose study to evaluate the safety, tolerability, pharmacokinetic and pharmacodynamic effects of ARO-ANG3 in up to 70 adult healthy volunteers with elevated triglycerides and various types of dyslipidemic patients.

The single dose portion of the study is designed to include up to four cohorts of ten adult healthy volunteers per cohort. Each SAD subject will receive a single dose administration of either placebo or ARO-ANG3 at doses of 35, 100, 200, or 300 milligrams. The multiple dose portion is designed to include up to four patient cohorts, including patients with non-alcoholic fatty liver disease or NAFLD, patients on a stable statin treatment regimen with elevated LDL cholesterol and triglycerides, patients with heterozygous or homozygous familial hypercholesterolemia, and patients with severe hypertriglyceridemia.

The MAD cohorts will receive two monthly doses of ARO-ANG3. ARO-APOC3 is Arrowhead's subcutaneously administered RNAi therapeutic targeting apolipoprotein C3, better known as APOC3, being developed as a potential treatment for patients with hypertriglyceridemia. APOC3 has emerged as a therapeutic target for triglyceride reduction. APOC3 is a regulator of triglyceride-rich lipoproteins or TRLs and is present in TRLs. APOC3 is a known inhibitor of lipoprotein lipase or LPL and LDL-mediated lipolysis of these TRLs.

APOC3 also delays clearance of lipoprotein remnants by the liver by inhibiting hepatocyte receptor-mediated uptake. Insight gained from transgenic mice over-expressing APOC3 and APOC3 knock on mice has shown that APOC3 delays very low-density lipoprotein cholesterol hydrolysis in vivo and may delay the removal of TRL remnants. Human genetic studies indicate that APOC3-deficient heterozygotes show reductions in plasma triglycerides and LDL cholesterol levels, risk for cardiovascular disease in these carriers was reduced as well. APOC3-deficient individuals or homozygotes do not demonstrate significant hepatic steatosis and appear to be phenotypically normal.

Familial chylomicronemia syndrome or FCS is a severe rare genetic disease with a prevalence of one in a million, often caused by various monogenic mutations leading to extremely high triglyceride levels typically over 900 milligrams per desolator, representing the top 0.1% of the population. Such severe elevations lead to various signs and symptoms, including acute pancreatitis, which can be fatal, chronic daily abdominal pain, type 2 diabetes mellitus, hepatic steatosis, and cognitive issues. There is no currently available therapy that can be adequately used to treat FCS.

Our first in human study of ARO-APOC3 is quite similar in design to that of ARO-ANG3. ARO-APOC3 1001 is a Phase 1 single and multiple-dose study to evaluate the safety, tolerability, pharmacokinetics, and pharmacodynamics of ARO-APOC3 in up to 63 adult healthy volunteers with elevated triglycerides in patients with severe triglyceridemia and FCS.

The single ascending dose portion of the study is declined to include up to four cohorts of ten adult healthy volunteers per cohort. Each SAD subject will receive a single-dose administration of either placebo or ARO-APOC3 at doses at 25, 50, 100, or 200 milligrams. The multiple dose portion is designed to include up to three cohorts of patients with severe hypotriglyceridemia and one cohort of patients with FCS. The MAD cohorts will receive two monthly doses of ARO-APOC3.

Consistent with our first in human studies, we have designed ARO-ANG 1001 and ARO-APOC3 1001 to give us a read out on safety and tolerability as well as a robust look at the pharmacologic activity and duration of effect. We are planning to measure ANGPTL3 and APOC3 levels as well as LDL cholesterol, total cholesterol, non-HDL cholesterol, HDL cholesterol, BLDL cholesterol, triglycerides, liver fat content using magnetic MRI PDFF in one ANG3 cohort, and other measures of drug activity.

I also want to touch briefly on the status of ARO-AAT, Arrowhead's second generation subcutaneously administered RNAi therapeutic being developed as a treatment for a rare genetic liver disease associated with alpha-1a trypsin or AAT deficiency. We are currently interacting with the FDA on that program. Keep in mind that to our knowledge, there has never been a drug to treat AAT-related liver disease in front of the FDA, so they have never had the opportunity to consider an approval pathway.

We had a pre-ID meeting with them in October and our discussions since then have been helpful and productive. We have discussed ideas on potential study designs and endpoints, which they are considering. We have completed the required long-term toxicology studies and the study reports necessary for submission are now available as well.

So, our intention is to move forward with a Phase 2 clinical study or studies as soon as we have clarity on the FDA's thinking around endpoints. Our hope is that the next study or studies may be able to become pivotal and provide a path to potential commercialization, but we do not have clarity on that yet.

With that brief review of our clinical programs, I'd like to turn the call over to Ken Myszkowski, Arrowhead's Chief Financial Officer. Ken?

Ken Myszkowski -- Chief Financial Officer

Thank you, Bruce. Good afternoon, everyone. As we reported today, our net income for the quarter ended December 31st, 2018 was $12 million or $0.13 per share based on 95.6 million fully diluted weighted average shares outstanding. This compares with the net loss of $13.2 million or $0.18 per share based on 74.8 million weighted average shares outstanding for the quarter ended December 31st, 2017.

Revenue for the quarter ended December 31st, 2018 was $34.7 million compared to $33.5 million for the quarter ended December 31st, 2017. Revenue in the current period relates to the recognition of a portion of the upfront payments received from our license and collaboration agreements with Janssen, while revenue in the prior period related to the recognition of a portion of the upfront payments received from our license and collaboration agreements with Amgen.

Revenue from the Janssen agreement will be recognized based on our estimate of the proportion of effort expanded toward fulfilling our performance obligations, primarily overseeing the completion of the current Phase 1-2 HBV clinical trial. We expect the majority of the revenue to be recognized in this fiscal year, but we also expect revenue in Fiscal 2020 as we will continue to perform certain follow-up activities through 2020.

Total operating expenses for the quarter ended December 31st, 2018 were $23.7 million, compared to $17.3 million for the quarter ended December 31st, 2017. This increase is primarily due to increased drug manufacturing and clinical trial costs as our pipeline of clinical candidates has increased.

Net cash provided by operating activities during the quarter ended December 31st, 2018 was $168.3 million compared with net cash used in operating activities of $14.7 million during the quarter ended December 31st, 2017. The key driver of this change was the $175 million upfront payment from Janssen during the quarter.

Excluding cash inflow, our cash burn for the quarter was higher than in previous recent quarters as we paid off a note payable in the amount of $2.3 million during the quarter. We estimate our near-term cash burn to average $20 million per quarter.

Turning to our balance sheet, our cash and investments totaled $303.3 million at December 31st, 2018 compared to $76.5 million at September 30th, 2018. The increase in our cash and investments was primarily due to the cash received from Janssen's. Our common shares outstanding at December 31st, 2018 were 92.6 million.

With that brief overview, I will now turn the call back to Chris.

Chris Anzalone -- President and Chief Executive Officer

Thanks, Ken. I mentioned at the beginning of the call that 2019 could be even more productive than 2018 and I view a few primary areas driving that. First, we expect ARO-ANG3 and ARO-APOC3 to create a lot of value this year. These are attractive targets that address a number of high-value unmet medical needs and we are the first to use RNAi against them.

Importantly, we expect to generate a substantial amount of data across several patient groups this year. I believe that we will have a good idea if ARO-ANG3 and ARO-APOC3 can become drugs by the third or fourth quarter. I expect this year, the current studies will generate the type of data that people are used to seeing from small molecule candidates at the end of Phase 2B studies. These will be important readouts, and as we did with ARO-AAT and ARO-HBV last year, we will look to report data at appropriate conferences.

ARO-AAT and ARO-HBV were big value drivers for us in 2018 and I hope to see ARO-ANG3 and ARO-APOC3 producing similarly for us this year. Depending upon what patient populations we choose to focus on, we could have a rapid path to pivotal studies.

Second, we are not finished generating and reporting data from the ARO-HBV 1001 clinical study. Patients will continue to be monitored for one-year post-last dose. ARO-HBV was very active in all patients studied and we look forward to seeing if even short-term dosing can have longer term beneficial effects. I expect that we'll continue to report data throughout 2019.

Third, we expect to begin Phase 2 studies in ARO-AAT this quarter and are hopefully that these may become pivotal. As we discussed, we are in active discussions with the regulators and beginning studies with agreed upon design and endpoints could be a substantial value driver.

Fourth, we expect to file CTAs for ARO-ENaC and ARO-HIF2 this year, representing what we believe to be the first commercially viable efforts to use RNAi outside the liver. This is a large leap forward for the field and an important strategic step for Arrowhead.

Finally, you can never discount Arrowhead's breakthrough potential. We have consistently shown breakthrough speed and innovation that we believe is best in the field and I expect this to continue. We disclosed our analyst day in the fall that we can now target muscle cells and I believe that unexpected breakthroughs will continue to be our hallmark and continue to build value for our shareholders.

As I said, I expect 2019 to be a big year for us. We are well on our way toward achieving our long-term goals to file two to three new CTAs every year, target a new cell type with the TRiM platform every 18 months, and have ten TRiM-enabled candidates in clinical studies by the end of 2020.

Thanks again for joining us today and I would now like to open the call to your questions. Operator?

Questions and Answers:

Operator

Thank you. Ladies and gentlemen, if you have a question at this time, please press the * then the number 1 key on your touchstone telephone. If your question has been answered or you wish to remove yourself from the queue, please press the # key. Again, that's * then 1 to ask a question. To prevent any background noise, we ask that you please place your line on mute once your question has been stated.

Our first question comes from Maury Raycroft with Jefferies. Your line is open.

Maury Raycroft -- Jefferies -- Analyst

Thanks for taking my questions. I'll start with ANG3 and APOC3. I may have missed this, but are you saying how many patients are you going to include in both of those studies? Are you going to start dosing the patients simultaneously? Are you going to start with the healthiest first and then move into the patients?

Bruce Given -- Chief Operating Officer and Head of R&D

This is Bruce. As far as when we'll start, we'll run through the normal volunteers first, especially for ANGPTL3, where we want to figure out the dose range before we move into the patient groups. My recollection is that those cohorts are generally about 8 to 10 in number, I think maybe 8 per cohort -- or 10. I'm getting the 10 signal here. It's hard to keep all these trials clear, but yes, 10 per cohort.

Maury Raycroft -- Jefferies -- Analyst

Got it. So, you'll include about 10 patients in each one of the studies?

Bruce Given -- Chief Operating Officer and Head of R&D

In each of those separate cohorts we described.

Maury Raycroft -- Jefferies -- Analyst

As far as the timing goes, you mentioned you'd know whether you had a drug by 3Q or 4Q, but presumably, you're going to show some sort of update before then on the dose escalation. Is it going to be similar with AAT and HBV disclosures, where that could come at a medical conference or do you plan on toplining that in the press release?

Chris Anzalone -- President and Chief Executive Officer

We'll see, Maury. It is our hope that we can report data at American Heart Association meeting in November of this year. It is our hope we can submit abstracts. As you point out with AAT and HBV, we found other smaller conferences before in those cases ASLD where we could give a little bit of an update on what we're seeing. My hope is that we can find those as well. I don't know that we can. I don't know that the timing will work out, but it is my hope that we can do that, similar to what we did with AAT and HBV.

Maury Raycroft -- Jefferies -- Analyst

Great. For the AAT study, looking forward to seeing that design. I guess for the endpoint discussion, can you talk about what the options are that are on the table that you're discussing with FDA?

Bruce Given -- Chief Operating Officer and Head of R&D

I don't really think I can. I don't see any reason not to believe this is an indication that is going to require biopsies. But outside of that, I think it's premature, really, to say much of anything else.

Chris Anzalone -- President and Chief Executive Officer

I think we are, relatively speaking, we're close to the point where we can talk about this in a more granular way. It is our hope we will be filing an IND this quarter. So, we're not asking you to wait too long. But I think we can have better clarity later this quarter.

Operator

Our next question comes from Ted Tenthoff with Piper Jaffray. Your line is open.

Ted Tenthoff -- Piper Jaffray -- Analyst

You mentioned an ADT-study -- how large will that be and how should we anticipate we could get data from that study? Thank you.

Bruce Given -- Chief Operating Officer and Head of R&D

Yeah, Ted. It's Bruce. We don't know the size yet because it really depends quite a bit on the endpoints and some of the design parameters we're discussing. It's one of those where the devil is in the details, if you will. It won't be a small study. ADT, as orphans go, is a large enough orphan disease to have a reasonable size study. It will be, I think, a landmark study in the field, in all likelihood. We'll have to see where things end up for me to be clear on that.

Ted Tenthoff -- Piper Jaffray -- Analyst

Is the goal still to start that in the first quarter?

Chris Anzalone -- President and Chief Executive Officer

The goal is to start that in the first quarter. I was going to say your other question was about data timing. As Bruce says, we're still a little bit in flux on endpoints and design and numbers and such. So, we're not ready to give guidance on data. I can tell you this. It is highly unlikely that we will have any data this year. I don't think that's in the cards. We can give you better guidance once we have a set design. I'll say one other thing on the size of the trial and on dosing or on enrollment.

As you know, this is our second-generation drug against AAT liver disease. We have good relationships with PIs here and in Europe. So, I think that that's going to bode well for us when we're looking to enroll the study. We also have a good relationship with the Alpha 1 Foundation and they're going to be a good help for us as we enroll in the study.

Ted Tenthoff -- Piper Jaffray -- Analyst

Just a quick housekeeping on the revenue side -- I know from the balance sheet in the cash position, you had a lot of money that came in from the Janssen partnership. Congrats on that. How do you anticipate recognizing revenues in the March and June quarter?

Ken Myszkowski -- Chief Financial Officer

So, we're recognizing $197.8 million in total from the initial upfront payment, which includes also the premium we calculated on the stock as well as the drug supplies. We're estimating that the majority of this will be recognized over the rest of this fiscal year. It definitely will go into next year as well. It will depend on our efforts as we monitor them throughout the next couple quarters compared to our budgeted efforts on that and exactly how we'll calculate the revenue.

Ted Tenthoff -- Piper Jaffray -- Analyst

That's separate from the $50 million milestone?

Ken Myszkowski -- Chief Financial Officer

Exactly. That's separate from that.

Operator

Thank you. Our next question comes from Katherine Xu with William Blair. Your line is open.

Katherine Xu -- William Blair -- Analyst

Good afternoon. I'm just wondering for the MAD for both agents in cardiovascular, why are you doing just two monthly doses versus the three that you did before? Then with just the two-month dosing with the kinetics, you could figure out your real dosing or proposed dosing for the future? I'm just curious about that. Then also, another general question is on the RNAi agents in the US. So, you guys, including all the other people, are doing the Phase 1s outside the US and then come back. Is it a practice that we're going to continue to see or do you think the FDA would be more receptive for early stage RNAi studies?

Bruce Given -- Chief Operating Officer and Head of R&D

Let me take the second one first. I wouldn't characterize the FDA as unreceptive. I can really only speak for ourselves. We have found Australia/New Zealand to be an excellent place to do these studies. It's a very clear, clear sort of regulatory path that has been pretty consistent and predictable. So, that has really worked well for us and we have liked it. But others may have -- I know that others have, for instance, tended to go to the UK. I don't really know what their reasons are. You'd have to ask them. But for us, it's been a very straightforward path.

There are also, frankly, incentives that are offered in Australia that have been useful for us as well, especially early in our lifecycle, when having significant rebates on clinical costs were meaningful for us. Did you want to add something?

Chris Anzalone -- President and Chief Executive Officer

Let me add one thing to that -- as you know, we have always followed the science in these clinical programs and the flexibility that we've seen in New Zealand and Australia and for HBV in Hong Kong has enabled us to follow that science quite rapidly. We've had a number of protocol changes with our studies just because we learned something new along the way and we've been able to get those things through quite quickly, like on the order of one or two weeks.

If we were in the United States, it would take substantially longer than that. It's made a lot of sense for us. It's been good for us to generate all this data and then go to the FDA for these discussions around AAT because we go with an awful lot of data we can talk about. So, I think that has facilitated really productive discussions because we have a substantial amount of data to talk about.

Bruce Given -- Chief Operating Officer and Head of R&D

Let me answer your first question now. We had initially designed the programs to be three doses just like we had done for AAT and HBV. Then as we really had a chance to collect all this data in the AAT program and live with that data, we recognized that we would actually be better off to do two doses and be able to follow that second dose out for a really good shot at understanding duration of effect and dosing frequency. It's becoming pretty apparent to us that it's likely that for most indications, we're going to be looking at quarterly dosing or maybe even less frequent than that.

By giving three monthly doses, it was obscuring the picture of what's really happening. So, with the single dose data in normal volunteers, we'll get a good idea of what the depth and duration with a single dose is. By doing the two monthly doses, that second dose, if the first dose doesn't get you all the way to complete suppression of whatever is achievable, the second dose certainly dose. Then we get to follow the kinetics of recovery all the way out.

So, we actually surprised ourselves when we were sitting there talking about it. I said, "Gee, we shouldn't be doing three doses here. We should be doing two." We could have done three. We did three with AAT and HBV and we actually looked in the mirror and said, "We ought to do two." So, that's why we did it. That's why we submitted the protocols to do that. It feels to me like it's going to be really helpful for us in figuring out what we think the right sort of dosing frequency will be moving forward from here.

Operator

As a reminder, that's * then 1 to ask a question. Our next question comes from Keay Nakae with Chardan. Your line is now open.

Keay Nakae -- Chardan -- Analyst

Just back to AAT, if for whatever reason you couldn't get agreement with the FDA about the next study being a possible registration study, what would you look to prove in the next Phase 2 study that you might then do.

Bruce Given -- Chief Operating Officer and Head of R&D

It's always hard to deal with hypotheticals, Keay. One thing is for sure. If we don't come to an agreement on a sort of Phase 2-3 design, we at least will have good clarity with the agency on what the right next step is. One way or another, we come out of these discussions with a pretty good idea of where the program is likely to be going, whether we're able to do a seamless Phase 2-3 or whether it ends up being a classical Phase 2 leading to a Phase 3, I think we will have a good sense.

Today, I couldn't play that scenario for you where we're really still talking to each other and thinking about this. We have to remember it's a frontier. They've never been here before. No company has ever been here before. Anytime you're in a frontier, it takes a lot of thought and planning to figure out what the route it. This is quite normal. We're working our way through it in a collegial and positive way.

Keay Nakae -- Chardan -- Analyst

Would you characterize that there is generally strong consensus on what the appropriate endpoints should be?

Bruce Given -- Chief Operating Officer and Head of R&D

I never like to characterize the agency until they speak for themselves. I think at this point, we're not done yet. I think we said that. We're still talking and we're still thinking and bouncing ideas off of each other. So, I think at this point, I would never want to characterize what they may or may not be thinking or where we're going to wind up.

Chris Anzalone -- President and Chief Executive Officer

I think the take home message here is these are truly productive discussions. They are receptive. They appreciate the problem that we are looking to solve. So, I think we are working at this truly collaboratively.

Keay Nakae -- Chardan -- Analyst

Thanks for that. We'll look forward to further updates there.

Operator

Thank you. I'm not showing any further questions at this time. I would now like to turn the call over to Chris Anzalone for any closing remarks.

Chris Anzalone -- President and Chief Executive Officer

Thanks everyone for tuning in today and we'll talk to you soon.

Operator

Ladies and gentlemen, thank you for participating in today's conference. This does conclude today's program. You may all disconnect. Everyone have a wonderful day.

Duration: 39 minutes

Call participants:

Vince Anzalone -- Vice President of Investor Relations

Chris Anzalone -- President and Chief Executive Officer

Bruce Given -- Chief Operating Officer and Head of R&D

Ken Myszkowski -- Chief Financial Officer

Maury Raycroft -- Jefferies -- Analyst

Ted Tenthoff -- Piper Jaffray -- Analyst

Katherine Xu -- William Blair -- Analyst

Keay Nakae -- Chardan -- Analyst

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