Molecular Partners AG (MOLN) Q4 2021 Earnings Call Transcript

Molecular Partners AG (MOLN 16.87%)
Q4 2021 Earnings Call
Mar 16, 2022, 8:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good morning, and thank you for standing by. Welcome to the publication of full year results 2021. [Operator instructions] Please be advised that today's conference may be recorded. I would now like to turn the conference over to your speaker today, Seth Lewis, head of IR.

Please go ahead.

Seth Lewis -- Head of Investor Relations

Thank you, and welcome -- welcome everybody to Molecular Partners 2021 year-end results conference call. My name is Seth Lewis, head of investor relations, and we are joined this morning by Patrick Amstutz, chief executive officer; and Andreas Emmenegger, chief financial officer. If you do not have a copy of today's results presentation, you may find it on the investors section of our website www.molecularpartners.com, under the events tab and it is also available on the webcast link if you are listening to us webcast today. Management will be making a few brief prepared remarks, and then we will open for your questions.

If you're planning to ask the question, please be sure you are dialed into the call as the webcast is listen only. And please note that management will be making certain forward-looking statements during today's call. And these forward-looking statements may differ materially from future events and will be reflected to certain words such as anticipate, believe, could, expect, and words similar to this, but not including all of those of some key facts may differ materially than our expectations. And we would refer you to our most recent filings on our website, as previously noted.

If you're listening to this on replay, please note that the call was recorded on March 16, 2022, and we would encourage you to refer to our website for the most recent announcements and public filings as they may have changed since the recording of this call. With that, I'll turn the call over to Patrick. Please go ahead.

Patrick Amstutz -- Chief Executive Officer

Hey. Thanks, Seth, for the introduction, also for the nice disclaimer, and I want to kick off with a very warm welcome from my side. I'll give you a moment to bring up the slide on our at our on our homepage. We'll keep the presentation for this year very sharp and crisp that we have more time for your questions.

I think that's where we can add more value. 2021 was an amazing year and I do want to start the call by thanking my team and all parts of the team that made this an amazing year. And we will work through all the accomplishments which were really many, and that was only possible by teamwork and having really skilled experts working together and really bringing forward drug candidates in all stages of development. And that just to remind us, during a global pandemic, that at this point in time might be a bit less in front of us also because other things are more in front of us.

But I do think it's far too early to call it a day on the global pandemic, and that will also be a part, I guess, of the Q&A section, especially around ensovibep. So let's go to slide number 3. I hope you have the time to pull up the slides. Slide number 3 are the accomplishments of the last year, and I do want to start with the R&D section.

There just to remind us we advanced ensovibep from a pre-clinical compound within one year to the phase two read-out called EMPATHY with Novartis, with those amazing results showing that we can inhibit the virus, that we can knock down viral loads and protect around four out of five patients from going to the emergency room, going to the hospital or dying. And even 9 out of 10, if you take emergency without meaning hospitalization and death. At the same time, we advanced AMG 506, MP0310, we made that a second priority to ensovibep, so this is where we had a let's call it a calculated delay. Good news is we are now kind of back on track with that, and we are testing weekly dosing with the aim to reduce IRRs and find an optimized activity window for 4-1BB activation, mainly for T-cell activation.

We also have a new molecule in the clinic since last year, that's MP0317, that's a CD-40 FAP, so very close to the AMG 506 concept. And obviously, there is a lot of crosstalk between these programs and learnings from AMG 506 can go into 317. We're also proud to have nominated 533, which is a tri-specific T-cell engager, so a tri-specific bi-specific in AML. I also touch on that drug on on the next slide.

We're very proud of this one. It is tri-specific [Inaudible] tri specific, but the mode of action is a bit more complex and it took us literally two years to engineer the right affinities and now we are pressing forward toward first in human with that drug where we see a lot of potential in an underserved patient population. At the same time, we initiated a new program that's the Radioligand Therapy program with Novartis, and we closed the deal there. I'll come to that on the same side, a bit lower down. But also they're starting a new activity on our platform and staying with the new.

We introduced the switch concept, which is a unique feature that you can build into DARPin, that you can make a DARPin that either finds target A or target B, something that is much more difficult to do with, let's call it conventional binding proteins like antibodies. For us, this is a new technology feature that we will be looking to move into product in this year and also the years to come. Moving from R&D to the corporate side, also, there are a lot of activities, so we listed our company in the U.S., so I've now a dual listed company raising $63 million in cash. To EMPATHY results, they trigger at the option exercise of Novartis for ensovibep with a $150 million payment, and reminding us that we have 22% royalties in -- in the high income countries.

And also the [Inaudible] partnership with Novartis was attached to a 20 million upfront and milestones and then also royalties. So overall, also on the corporate cash side, a very fruitful year that now gives us funds that carry us well into 25 and Andreas will point that out in more detail in his part of the presentation. So the one slide we have is now slide number 4, to sort of reminder what we're all doing, that's our core business. And in simple, it's three dimensions.

It's we take DARPin features that are DARPin unique. We turn it into differentiated candidates. So candidates build [Inaudible] DARPins, multi DARPins that are different than what you find with other therapeutic modalities. And then that aims to benefit a patient, so the patient benefit.

I want to kick off with the blue boxes, that's the core, that's multi specificity. And in the last years you will have heard me tell many times [Inaudible] or repeat proteins are natural choice for multi specifics and that's one natural angle that we have. And the one thing I want to point out is that if you say multi specifics, many people here bi-specifics, and it's not only bi-specifics, it's tri tetra, penta, and so on, as you see in this picture. So it's far beyond conventional by specificity.

In the  middle there, we have 310 and 317. These are molecules that work by co-engage in two targets and only the co-engagement triggers activity. So it's a smart drug that looks for both targets, it binds them at the same time, it activates immune cells from dendritic cells, b cells on the 317 more toward the T cells for 310. Now the only, let's call it [Inaudible] that these are activators of immune cells, but likely will not have single agent activity.

So they need to be combined and as such are more programs to be partnered. So we added a layer of strategy into that we would also from now on or from then on, look for programs which have called single agent activity or at least showed themselves or should showed their activity as single agent. So we're now branching to end. So we back that's the tri-specific SARS-CoV-2 inhibitor.

It binds to the RBD of the spike protein and it was designed to prevent escape, as we all have witnessed, especially when we showed the data on Omicron, where I think we were really the only compound of the first generation that is still inhibiting that viral variant. And to my intro statement, we do think that there's next variants to come and we are very confident that ensovibep can help us ease those and when those viral variants show up. Moving out to 533 to three targets, that's also tri-specific, then engage in T-cell engager, and here the complexity of different. As in so [Inaudible], three super potent binders, we have to engineer the affinity of 533 to three targets, namely CD-33, 70 and 123.

And these targets are all not unique for the AML cell, they are also found on hematopoietic stem cells. So the trick was to make a DARPin that does not kill mono expressing healthy hematopoietic stem cells but has a favor for the AML, the leukemic stem cells that are killed. And this is what we did in two years, optimizing affinities and engineering. And now we're proud of this molecule moving toward the clinic.

Having said that, I'll now go to let's call and branch out of the blue box, the multi-specificity. As our team has also invested other DARPin features that can lead to differentiation, namely the Radical Simplicity, which actually speaks to small size, high affinity. And if you go into the Radioligand Therapy field, what people call the delivery agent, they call it the vector. So here we're using DARPin as delivery vectors to deliver payloads, in this case, Radioligands.

But you can also think of drug conjugates, so that could be a sub idea of those activities. And here it is all about small size, high affinity to penetrate deep into the tumor, stay there long, but not affect the whole system long-term as you will have a very short, systemic half life. We're excited to move that forward, mainly in collaboration with Novartis, but we'll also invest some of our activities to look into additional programs next to the [Inaudible] ones. And then moving to the green side, the other side, which is the switch concept, and that this DARPin that carries the blue and the yellow binding side.

And as you see, just by the steric positioning of the binding side in one, this DARPin has to decide who may bind, to bind A or B. It cannot bind both at the same time. And by tuning the affinities to these targets and by the abundance of the targets in the system or not, we have built, or we can program this DARPin to act as a switch that locally or in this specific situation opens up and activates. We like to call this a smart drug, and while this is not yet built into a candidate, we are have a few ideas what we want to do.

And we also invite -- want to invite other companies, other groups, biologists, medics to think about how to best use this technology that so far was maybe more a dream. And I think we can make that reality. With that, I'll come to the upcoming milestones and start with ensovibep. Here this is with Novartis, you'll also have to accept that we cannot speak too much about it as Novartis is in the lead and we get information that we can then share or not.

And often we are not generating that information of this is with Novartis. There is EUA review ongoing. Obviously, there's also parallel discussions with governments about stockpiling and getting ready for the next variant to come. Plus, and this is something that will likely be Virology Day for us in Q2 of this year where we want to present more data.

And Novartis has an elaborate presentation strategy for the compounds for this year. And moving now to AMG 506. Here, we will expect to have more data on the weekly dose thing that we didn't share with Amgen that they can review, and we should then have a decision of this year, how that program can and if move on. 317 initial data so likely very similar data to 310 by second half of this year, and also 533 going into the clinic toward the end of this year.

Radioligand Therapy, I did touch on. There, it's mostly a collaboration with NIBR, but also additional work that we will be starting up ourselves. And side note on abicipar, that's the ophthalmology drug that we have gotten back. There's a few sites in the back of this presentation.

We now have a full package on the let's call it safety. We have gathered the feedback of the agency, how a trial would look like or need to look like to get this toward approval. And together with the data, the path forward, we can now engage with potential collaborators on their interest and how they see it. And if there is a partner for a path forward.

With this, I would close this part and I would hand over to Andreas, to give us the highlights on the key figures and financial side.

Andreas Emmenegger -- Chief Financial Officer

Very good. Thank you, Patrick. So I am now on slide 6. Happy to tell you more about the '21 financials and also, maybe more important, the outlook for the coming year.

On the finance side, I only covered some highlights, so you'll find many more details in the appendix of the presentation and of course, in the January 14th  to 20th available on our website. And so the numbers for '21 do not include anything surprising. It's all within the latest public guidance and also within our own internal budget. We recognize total revenues and other income of $9.8 million, compared to $9.3 million the year before.

We were totally expenses on 73.2 million, which means we invested about $5.5 million more than the year before. This led to an operating loss of $63.4 million compared to $58.3 the year before. Net financial loss was just $0.4 million, excuse me, compared to $4.4 million years before. This is a rather volatile year-to-year because we actually [Inaudible] to unrealized currency losses on our U.S.

dollar and euro cash position for this unrealized, and we do not -- do active hedging because we I plan to keep the currencies in deciding the amount that we expect to be needed going forward to where -- to execute on our on our plans. Bottom line, this resulted in a net loss of $63.8 million, which is $1 million more than the year before. Net cash used for operating activities in 2021 was $91 million, which is about $20 million more than our P&L expenses due to our -- contributions to the manufacturing of commercial supply of ensovibep. We ended the year with a solid cash balance of $132.8 million and $163 FTEs on our payroll.

I move to slide 7. With our balance sheet as per the end of '21. It continued to be strong and dominated by the cash position end of '21. It was $132 million, a solid equity position, $173 million and no debt.

Early this year, and this is to put the bullet on the bottom right side -- early this year, we were able to add another hundred $70 million to our cash balance with the receipt of $150 million for the option exercise for ensovibep, as well as the $20 million from NIBR on the new RLT regulating therapy collaboration signed in December last year. This brought our cash balance to close to $300 million, or to be more precise, $291 million as per the end of February 22. The contract liabilities of $35.2 million are expected to be recognized into revenue in '22, always subject to the progress and costs of the underlying collaboration and programs of Amgen, Novartis, and Swiss government. In other words, these are not financial liabilities, but part on the balance sheet until they go into revenues.

So they are nonrefundable. Other assets and other liabilities are mostly related to lease, pension accounting, as well as equipment and general working capital positions. So that I move to my last slide and maybe most important one. So we had a very exciting starting to the year with the great ensovibep data, and with that, the excess option exercised by Novartis which triggered a $150 million payment as I said before, and we also added a $20 million for -- from the NIBR collaboration, so we increased the balance sheet to close to $300 million by the end of February.

And with that, we have secured the funding into '25, so more than three years from now. It's a -- we are in a very good position to execute on our plan. Also, considering the rough biotech markets out there. This excludes and that's important, any potential further payments from existing or new partnerships, including the potential 22% royalties on ensovibep sales, as well as potential milestone payments from Amgen or from NIBR in Boston.

In terms of P&L expense, we guide for between $75 million to $85 million for the year 2022, this about 10% more than last year. For total full year '22, we anticipate to make operational profit and positive cash flows as a result of the large collections we made early this year. How much this profit will be at the end? We cannot guide, because it very much depends on the success of ensovibep. And as always, this guidance is subject to progress and changes in our pipeline.

With that, I am and at the end happy to take more detailed questions if needed on this call or in one on ones. And I hand back to Seth or Patrick. 

Seth Lewis -- Head of Investor Relations

Thanks, Andreas. Appreciate it, both. Operator, we're OK to go for questions now, please.

Questions & Answers:

Operator

Thank you. [Operator instructions] Our first question comes from Richard Vosser with J.P. Morgan. Your line is open.

Richard Vosser -- J.P. Morgan -- Analyst

Hi. Thanks for taking my questions. A couple things, Patrick. I know you mentioned that the process of EUA is with Novartis, but -- any insight, any help you can give us on timing or progress of -- that process? That big question one.

Secondly, just on the EMPATHY trial, and the move to subcutaneous versions of ensovibep, could you give us an update on part B? Has that started and recruitment there and where that trial might be recruiting? And the subcutaneous version, thoughts on the progress there? And then finally, maybe just the Virology Day, can we see progress on other virology candidates this year? I know it's not part of -- your targets or news flow, but just just thoughts there, please? Thanks very much.

Patrick Amstutz -- Chief Executive Officer

Hey. Thanks, Richard. All really great questions. And I'll be happy to elaborate on as much as I can.

So the EUA, as you know, was filed. It's in the hands of Novartis and is the active process and they are working very closely with the agency on this. And from what we hear, -- this discussion is going well, and there is real interest, I guess, -- from the agency to dig into this. I can't guide you on the time.

I don't think there is a stop date. I think this is definitely something that kind of both sides are navigating. So we don't know, and we if we would, we couldn't share what the timing is, and I don't think there is a fixed timeline. On the EMPATHY side, I think I can just speak maybe a bit in general terms.

You were asking about the part B and the subcu part or let's say injection. That would then definitely also add, let's call it a more broad application opportunity for ensovibep. I think, what we all saw is that with Omicron that the situation changed in that, that many more people now have COVID, but also less are ending up in the hospital. So to repeat part A and part B on the outcomes is quasi impossible as you will have less hospitalization.

So either you have a huge number of patients or you move to other end point or you have to wait for a next variant that I think will come and then you're back. And I think those discussions are ongoing. And I know also Novartis internally, plus the agency how to deal with this. Here, nothing has been decided.

There's no active trial at the moment. So access to actually also it's winding down but so subcu is -- we're not dosing patients, part B is -- not going forward until we know how we want to navigate that space. On the one hand, this is disappointing as you would want to have immediately around part B into subcu. On the other hand, it's also sort of it and this is a term Seth coined, we have a last mover advantage, because at the moment also no one else will be able to bring a COVID drug forward on the endpoints that we had.

So it's a pro and con in one. So we need to now navigate this space, maybe move toward, let's say a different outcome could be viral load reduction, could be symptom reduction, but hospitalization -- is a difficult one or maybe death so -- far and there is nothing decided. But those are the thoughts that are sort of obvious, -- and we are debating but also Novartis and the agency are looking into. I'll now move to the virology question.

Yes, we are working on a few viruses. We have not disclosed which ones. We will not have final data by the R&D day -- the Virology day. But we will give an update on our ideas on some of the viruses we're working on.

But at that point in time, we will not have nominated candidates. Obviously that's what we then want to do. So this will be sort of a day where we will hopefully be able to show more data of ensovibep. We'll also have more data coming there.

I mean, that was an interim 29 day cut off. We should have more data from that, plus at one point in time, also the 91 day data. Then, we will definitely talk about our ideas in virology and maybe a bit the progress on one or the other virus. But you are right to point out that obviously, I was only speaking about candidates.

80% of our coworkers are working on candidates or pre candidate stage research candidates that we hope to move into development. And yes, in virology, we have a few a handful of candidates we're looking into.

Richard Vosser -- J.P. Morgan -- Analyst

Great. Thank you very much. 

Operator

Thank you. Our next question comes from Georgi Yordanov with Cowen and Company. Your line is open.

Georgi Yordanov -- Cowen and Company -- Analyst

Thank you so much, and congratulations on all the progress. [Inaudible]  ensovibep, what additional data might be required from regulatory agencies ahead of receiving EUA approval? Is there -- do you expect anything like clinical that the agency would need? And of I guess, you plan to submit additional follow up data showing efficacy against Omicron and then on MP0317, what have we learned from 310 that might be applicable to the development of 317 specifically for the monotherapy trial? Do you expect any monotherapy activity? And then maybe if you can talk about the potential partnership opportunities? And lastly on 533, maybe if you can just briefly talk about some of the challenges we've seen to date with bi-specific antibodies in AML, code targeting CD-33 or CD-123, with CD3. Have you identified any structural trade-offs of combining multiple DARPins?

Patrick Amstutz -- Chief Executive Officer

Yeah. Thanks. All great question. So I start with Enso and data.

So I mean, it all would be. So the day to -- that we could show the agency or Novartis can show the agencies, all additional data from part A, at part B is not going on. And so I think that is just safety data after day 29, there's just more there's efficacy data. So call it may be long COVID data that might be showing up there.

So those are the data pieces that Novartis is collecting, but also additional data that we just didn't have then. For sure, I mean, paint the sample of 400 patients, that is not the largest trial. So we definitely are looking forward when we can start part B and gather just more data in patients with ensovibep moving forward, especially at also Richard was pointing out, to be able to go into a subcu formulation that would definitely be the best for application. So I think that the subcu is the important part, but that's not linked to the EUA.

You were also asking about Omicron, so that data is all preclinical. And from what we know and also how the agency has seen that the preclinical data, also that live virus but also pseudo-typed virus data is good enough to expand the label for the variant. So this was also done for a [Inaudible] antibody that did show a positive effect in specific settings, but not on Omicron patients, but in vitro on Omicron. So we believe our data that we have from the lab is strong enough to cover also for the clinical setting.

And then hopefully, that's also for future variants that could come from Omicron. I heard it is now paired with Deltacron and who knows what the next variants will be. I think they're just a word of caution to all of us. I mean, I remember a year ago everybody said that wave is over and your product is not needed and we feel a bit the same this year.

We sort of predicted that people will say, "Oh, we don't need it now, now it's over." But I do think next fall will be here and new variants will come. With that, I'll go for 310, 317, and maybe just quickly remind you of the data that we have. So -- and maybe what the molecule does. So you dose -- you co-engage FAP and in 310 work -- that's FAP and for on 4-1BB, that leads to co-engagement in the tumor that leads to activation of T-cells.

If you give too much and you -- find both targets, saturate both targets individually, you don't get activation that leads to a bell shaped activation curve. So you don't want to over dose. At the same time, giving some high doses especially you can also see infusion related reactions that we also reported as quality the only side effect. So going to let's call it the lower or more controlled dose, by weekly dosing, we are hoping to reach both less IRRs and a better exposure profile, not overloading or under loading the system.

And from the data we have on that, that should translate hopefully not one on one, but very closely from 310 to 317. Again, the bell shaped curve and the activation, we haven't or we cannot comment on IRR assess, we are at first have to dose escalate to higher doses if that also would show for 317. But those are the dimensions we would look into and hopefully learn -- from one to the other. So we're also looking into a weekly dosing and a three weekly dosing for 317, maybe even do it in parallel not to lose time and find different dosing schemes that then can be later used for combination trials for 317.

I hope that is helpful. Then maybe the partnership directly linked to 317 or 310, the question. For 317, you're activating dendritic cells, macrophage and B cells, and that is upstream of T-cell -- in T-cells. For 310, that's the T-cell world.

We have partnered with Amgen, as they have a lot of T-cell engagers and that combination makes sense. 317, that is upstream can be really combined with many approach -- approaches in oncology -- immuno-oncology is a more conventional oncology. So there we would also be open -- for partnerships as only activating the immune system will not be enough, also their combo trials will be needed. And a partner that can to look into more than one combination I think, would be beneficial for the molecule and for us as a company, as we will not be able to run several trials in parallel.

I'll now go to 533, that tri-specific, bi-specific and yet the key problem is that we are trying to solve is that many of these targets on AML cells, I was talking about and you brought up CD-33 and CD-123 are not exclusively found on AML cells, and in our term we call them these are not clean targets. The problem is that you then get on target side effects. So you are killing healthy cells of the blood system. So hematopoietic stem cells, you also get a lot of cytokine release, you get cytokine storm and you can measure that in the test tube, but also in the clinics, as some of these molecules have been stopped and then less active forms of them have been moved into the clinic.

And I think macrogenics was the most recent one to do so and maybe Seth, correct me if that was the wrong one, but I think they just gave an update to move to a less active form. Now, at the same time, we have a molecule that binds these targets with low affinity. So on the healthy cells where you have a low expression, you do have expression, but maybe just one and not two. And at a lower level, you are not killing those cells.

And then on the AML cells on the blast, but especially on the leukemic stem cells, you find high expression of at least two of these targets, that we are targeting. And we see very nice killing, but we also see at the same time that we are not having the side effect on the healthy blood cells. And this therapeutic window that we hope to open is really the differentiation angle of this approach. I hope that was helpful.

And please follow-up if I did not cover your questions.

Georgi Yordanov -- Cowen and Company -- Analyst

No, thank you so much. Incredibly thorough and answered all the questions. Thank you, and congratulations again with the progress.

Patrick Amstutz -- Chief Executive Officer

Thanks, Georgi.

Operator

Thank you. Our next question comes from Jo Walton with Credit Suisse. Your line is open.

Jo Walton -- Credit Suisse -- Analyst

Thank you. Just a few clarification questions, please. Your EUA progress, you talked about the agency, but can we assume that this is both the U.S. and the European agencies? And on the timeline that you understand, would it be sensible for us to model A2Q 22 approval in at least one of those regions? Can I ask, historically, you said that you thought you'd need about 1700 patients in EMPATHY B, given the change in the market background, and fewer people needing to go to hospital.

Are you suggesting that this would have to be materially higher than that in order to get the data that you wanted? And is it possible for you to do a sub cut smaller study? Or do you have to start EMPATHY B before you can start the sub cut with it? Because the sub cut clearly is the one with -- a particular commercial need, I would have thought. Can I ask on abicipar, if you can give us any hint of what was said in your meetings with the FDA in the sense of whether we would be expecting to see effectively a rerun of a phase three study. So -- a really material additional study that would be required that may help us work out your probabilities of you getting a partner or not? And my final question is one, on finance. In your [Inaudible], it says that you've got -- a University of Zurich royale payment to make, which is tiered on the royalties that you get.

If we were lucky enough to see material in ensovibep revenues this year, would we see a royalty go out that would take that net contribution of 22% down materially this year? And if you could also just help us on any other elements that might come into your P&L, if in ensovibep -- comes on. You mentioned that you had some manufacturing costs last year. Would we see any manufacturing costs this year? Or is it just a simple royalty relationship where Novartis would just pay you effectively? All of that is now done by then. Many thanks.

Patrick Amstutz -- Chief Executive Officer

Hey. Thanks, Jo. And I'll try our best to cover all those questions. So the first is the EUA, I think, formally speaking, yes.

Novartis is going to look for global approval as fast as they can for ensovibep. I think it is not called in EUA in Europe or other legislations. I think there is some more enrolling review. And yes, Novartis has started those discussions including Europe, including Switzerland, including the U.S., and just historically speaking, the U.S. is usually the fastest in those discussions and maybe also the most meaningful for potential government contracts.

So that's why I was hinting more toward the U.S., but you're absolutely right, this is going to be a global approach. On how we -- yes, please.

Seth Lewis -- Head of Investor Relations

Sorry, Patrick.  To be specifically clear to her question, the application for the EUA is with the FDA. That's with the -- there is no EUA application in Europe submitted [Inaudible] because of Patrick saying it's true that they don't have that exact process but that is yet to come. There has not been any official filing in Europe at this moment. 

Patrick Amstutz -- Chief Executive Officer

Yeah. But the discussions obviously pre-data. -- and then the model I think that I have to leave to you, how you model that, and the timelines and and how you see that. I would rather go toward a patients and yet the way I think we see it at the moment if you run an Omicron patients and you want the same end points as in part A for part B, you would need more patients.

I think that is rather logic or you change the end points and go for viral load reduction or symptom reduction. So I think you can go both ways and Novartis is debating everything and they will definitely update us and the public once they have made progress on that discussion. How to bridge subcut is a good question. I think there's many ways how to deal with that.

I cannot comment on them. Also, I think is it a bridging trial, is it more a [Inaudible] in the PD trial? I wouldn't know what the best strategy today is, and Novartis will give us both updates once they know more. Let's quickly go to the abicipar question, which is a good one. So just to remind us what kind of the bid to face up to program.

So we had partnered up ten years ago with Allergan. They had run a phase two/three, sorry, phase three called CEDAR SEQUOIA. So two, phase three trials that actually had a positive read-out for the every two and every three monthly dosing. But we have this inflammation rate of 15%.

Allergan improves the material in a first step and brought that down to below 10% in a maple trial. That was a smaller phase two trial. And then AbbVie took over and further improved the material, especially out of the syringe and how you apply the material. So they brought this whole manufacturing, including syringe to a next level.

Actually, this is summarized on slide 17 of our deck, if you're interested. We then got it back as AbbVie decided to go more for gene therapy and not injected that just in ophthalmology. That was a strategic decision. We got it back and we then took all the data, looked at the data and also engaged with the agency to find out what trial would be needed to go toward re or -- toward approval.

And I think we kind of have summarized that there. So resubmission of the BLA would be possible with the primary readout at 48 weeks. It is a controlled trial, so likely again, a year. So a black mask they don't like to work blinded in ophthalmology and mask trial.

And if everything looks good, we can use the CEDAR and SEQUOIA data to for approval. So I think it's something in between. It's not the full blown phase three that we had. It's also not only a little safety trial, so it's somewhere in the middle there.

We know what we would propose, Tthat's not yet in the public, but it is more than only a short safety trial. But it's also not the thousand patient trials, so it's nicely in the middle there. And I think it allows us to now engage with potential partners, understand what the investment would be to get abicipar approved. And I think this is for us the unknown so far.

I think everything else we can now put together, but how the let's say the field has evolved from [Inaudible] data, but then there was [Inaudible] approval. It's an interesting setting and will test the waters and see how companies come back. I think good news for us is that we believe that the inflammation question is solved. There's also learnings for us there and now we have to find out if there's still a commercial opportunity here, and with that, a partner to unlock the commercial opportunity.

So we're not guiding that, we will invest any money here, but we'll invest that needs to find out if there is a partnership to be done. I'll hand over to Andreas for the financial question.

Andreas Emmenegger -- Chief Financial Officer

Yes. Thank you, Jo for the question. So on university Zurich. No, we do not owe them any fees, was or stopped royalties or [Inaudible] because the base patterns expired last fall.

So we don't owe them anything. However, maybe it's also in the 20th, we paid $1.5 million to the University of Utrecht, because they supported us a lot on this project and that engagement that we for that we paid them $1.5 million that was paid also last year, so that is on that question. And the other one on the ensovibep, yes, it's a pure role to play this year. We do not expect any sort of costs on our side.

Actually, it's on the contrary, we were able to charge Novartis $13 million out of the $20 million investment we made to commercial supply. So that is a partial recharge, that is still that will be paid very soon. And we also can recharge the direct expertise on our side working on the project. Obviously, this is going down now very fast, but we can reach out to direct.

So it's a pure role to play.

Jo Walton -- Credit Suisse -- Analyst

Thank you very much. 

Operator

[Operator instructions] Our next question comes from Daina Graybosch with SVB Leerink. Your line is open. 

Daina Graybosch -- SVB Leerink Partners -- Analyst

Hi. Thank you for the question. There's been a lot of good discussion already, so we're happy to on, and [Inaudible] about for me. One, I think you mentioned Lilly's recent approval of -- not approval, emergency use authorization for bebtelovimab.

And I'm wondering if you could talk about the data package they had holistically compared to ensovibep? Any similarities and are there any differences that could make it different, ensovibep different than Lilly's for the agency? And my second question is, I wonder how you're thinking about endemic COVID and whether you're working on additional follow on DARPins that you maybe could pull out if a variant emerges that is resistant to ensovibep and what that process looks like internally?

Patrick Amstutz -- Chief Executive Officer

Hey. Thanks, Daina. And I'll keep it very top line on Lily, as I am not the expert. I don't know exactly all the data parts there.

I would say, let's say what is similar and what less. I think what is similar is that the Lilly antibody also binds and can neutralize Omicron, and I think a deep understanding also by the agency that a next variant is likely going to also come from that variant. So a need for have to have something that is active on Omicron, and so is maybe even broader applicable than an antibody. So I think it is not wild speculation, but I would hope that the agency sees our line through all the variants while the Lilly antibody, yes, it works in Omicron, but I think antibodies now have a history of also losing activity on new variants.

I think that's the similarity. The exact data they had, I can't speak to I don't know the data. I do know that the agency definitely was very open to speak with Lilly, and I think that is maybe a bit too different that obviously Lilly had a first antibody, has a large database for that antibody and an active discussion. So -- I would see that they could hit -- the street running with the agency and have more data to reference than us.

And I think that is just the way it is. And I think those are the obvious things. But let's say on the positive side, a clear need to be creative to get an emergency use authorization for a molecule that can be actually saving many lives if the next variant comes. And I think that's exactly where we position ourselves.

Your question to endemic COVID is a good one. I do think we are hopefully hitting endemic and just meaning that the case that is don't rise, but endemic can be at a very high number and also new variants can at any point commented to remind you, new variants come from old variants and the more virus load is out there in the globe, the higher the probability of a new variant coming up. So I think we're at the highest risk ever for the next variant. We also now know that variants can through vaccines.

So that's actually not a good thing. So I personally am very glad that we have ensovibep ready for whatever to come. Now, you also hinted toward, let's call it the variant that would shake off ensovibep, and yes, we don't know what the next variant is, but we also do know from our internal work. [Inaudible] where [Inaudible] ensovibep could be, and yes, we already have a new variant for that.

So there is a candidate that call it ensovibep 2.0, that would cover for some escape mutations that are and were known for ensovibep also published, that we have ready to move forward. And obviously, also making the molecule also a bit more stable and developable, keep in mind ensovibep was selected in six weeks. So we also just did an upgrade for the whole molecule.

Daina Graybosch -- SVB Leerink Partners -- Analyst

Great. Thank you.

Patrick Amstutz -- Chief Executive Officer

Thanks.

Operator

Thank you. And we have a question from [Inaudible] with FUW. Your line is open.

Unknown speaker

Thanks a lot for taking my questions. I'm surprised your guidance for operating expenses is relatively low considering you have a lot of cash and your cash burned rate into '25 suggests that you're not planning to materially increase those expenses in the middle of this year. You are going to present a virology candidate or potential candidate potential programs. Is it -- is your planning that you gave us now based on the assumption that ensovibep fails? And do you have a second planning in case of ensovibep is a success and then you will come up and say, "OK.

Now, we double all our expenses because we expect a lot of more cash."

Patrick Amstutz -- Chief Executive Officer

Thanks, Rup, and for a very good question, and one that we are also turning up and down here. I think you see the honest answer is that our programs that we are investing in are still early. And even if we doubled the numbers of those, the cash impact is not that high as the expensive part comes later. And it would mean if we really want to change that we would have to invest in 317 or in 310 ourselves.

So that's where we could spend more money, but that's also where we don't think we can make a big difference. And we have to be strategic with where we invest their money. So as much as we would like to turn off to spend and invest more at this point in time, our pipeline is not built to do too much of that. And having said that, I do think if we would then get, let's call it massive funds more, we'll have to really think hard how to invest that money going forward.

And I don't want to start any speculations, but we will definitely also turn the stones internally and see what we can do be it on the manufacturing side of DARPins and others. Maybe to invest more in pandemic readiness, things like that or definitely something we are being approached by many and and things like that. But I do think at this point in time, let's call it our conservative spend is not that conservative. It just more reflects the stage is off the molecules we have.

And if we would like to invest, I think it would almost mean that we acquire a molecule that is further ahead than our.

Unknown speaker

Thanks.

Operator

Thank you. And there are no other questions in the queue. I'd like to turn the call back to Patrick for closing remarks.

Patrick Amstutz -- Chief Executive Officer

So I'll kick off and then Seth can close the call. So, hey, thanks for everyone for joining the call. Also, thanks to all our analysts for all of these really good questions that allow us to go a bit deeper and we wanted to spend time on the questions. I think that's where we can work together and build the understanding of where this company is and how it's going forward.

And I do want to thank all our collaborators, especially Novartis, for a great collaboration on ensovibep. And then all my coworkers in molecular partners for an amazing year. So hard work out there and just so much comradeship working through those moments that were not always easy and really delivering value for first patient but then also shareholders over the last year, so thanks for that.

Seth Lewis -- Head of Investor Relations

Thanks, Patrick. Thank you all for joining us today. Really appreciate it. Happy to follow up with any questions that you still have.

And we will make sure that we're available for that throughout the day and in the coming days from here. I look forward to updating you on future events coming up, including the virology there, which we discussed. And we will be coming out with the actual date for that in the near future, but that will be occurring in the first half of this year. And please let us know if there's anything else we can help you with.

Have a great day. Thanks, everyone.

Operator

[Operator signoff]

Duration: 60 minutes

Call participants:

Seth Lewis -- Head of Investor Relations

Patrick Amstutz -- Chief Executive Officer

Andreas Emmenegger -- Chief Financial Officer

Richard Vosser -- J.P. Morgan -- Analyst

Georgi Yordanov -- Cowen and Company -- Analyst

Jo Walton -- Credit Suisse -- Analyst

Daina Graybosch -- SVB Leerink Partners -- Analyst

Unknown speaker

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