Arecor Therapeutics (LSE:AREC) — Year End Results

0:01 Good morning, ladies and gentlemen, and welcome to the ARECOR THERAPEUTICS PLC Year End Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and could be submitted at any time via the Q and A tab just situated on the right hand corner of your screen. Please simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all of the questions submitted today and publish responses where it is appropriate to do so. These will be available via your investor meet company

0:32 dashboard, and we will notify you by email when these are ready for your review. Before we begin, I would like to submit the following poll. And if you could give that your kind attention, I'm sure the company would be most grateful. And I'd now like to hand you over to CEO, Sarah Howe. Good morning to you. Good morning. Thank you, Jake. So good morning, everybody. Thank you for taking the time to join us today. It's a pleasure to be here. So my name's, doctor Sarah Howell. I'm the CEO of ARECOR, and I'm joined today by Susan Lauter, our CFO. And today, really, we'll give you an introduction to ARECOR, our technology and the proprietary products that we're developing and also cover some of the highlights from our year ending 12/31/2021. So just draw your attention to our customary legal notice.

1:23 So by way of introduction at ARECOR, we our purpose here is to transform patient care by enhancing existing therapeutic medicines so that they're safer, more effective, and affordable. And we do this by leveraging our innovative and proprietary formulation technology platform, Aristat, that we develop a novel formulations of existing therapeutic products that enhance their properties. As a technology platform company, intellectual property is absolutely critical to us, and we have very broad and robust IP protection of both the ARISTAT platform itself, but also the enhanced versions of therapeutic products that we develop using that platform.

2:08 We are a clinical stage biopharmaceutical company. Our first area of therapeutic focus is in the diabetes space where we're using Aristat to develop much faster acting and more concentrated, faster acting insulins, and I'll talk about those in a little bit more detail later. And we've also expanded further into an area that we call specialty hospital products. This is where we're taking products that are already on the market, but used in the hospital setting often in chronic care for, oncology, for example, or in emergency use. However, those products are only currently available as in powder forms that require a complex mixing procedure prior to use. So here, we're able to use the Aristat technology to develop stable liquid, ready to use and ready to administer versions of these products, which means that they can be used safely and effectively and quickly importantly at point of care.

3:04 And we've entered into from our specialty hospital franchise, we've licensed two of these products to Hikma Pharmaceuticals under co development and licensing agreements, and they're progressing well through development currently. And again, I'll talk about those. And our strategy overall from our proprietary pipeline is to develop these closer to market to a higher value inflection points prior to partnering with major pharmaceutical companies for late stage development and or commercialization under our technology licensing model. So alongside our own in house proprietary products, we also partner with leading pharmaceutical and biotech companies. This is where we work on their proprietary products in house at ARECOR, and we're applying the Arasat technology platform to develop superior versions of their products, and these could be products that's either in development or on the market as life cycle management.

3:58 This is a revenue generating model. Our partners pay ARECOR to perform the development work, so that's the application of the ARECISTAT technology. And when we've developed a novel formulation of their product with enhanced properties, they have the option then to take that further forward in development and ultimately to market under a technology licensing model, and these tend to be milestone and royalty bearing. So overall, we're very much commercially focused business. We have revenue generating partnerships with a leading, pharma and biotech companies and also upside potential from the future partnering and licensing of our proprietary product pipeline. As many of you may know, we also had a very successful oversubscribed AIM IPO in 2021, And we we're using those proceeds to further enhance and develop our proprietary product portfolio.

4:56 So just looking, at some of the operational highlights from 2021, this also includes some of our post period events. So in terms of our proprietary product pipeline, we made very significant clinical progress across the year, that's flowing into 2022. We received and we're very pleased to receive IND clearance from the FDA, that's The US regulator for our second clinical study for AT two forty seven, which is our ultra rapid acting insulin. So this study is ongoing in The US at the moment and it's a three day insulin pump study. And I'll talk a little later around why that's so important. We're also really pleased to be able to announce, very positive, results for our eighty two seventy eight, which is our ultra concentrated rapid acting insulin.

5:47 And this was a Phase one first in man trial, and those, results certainly hit the high end of our expectations. And again, I'll talk you through those. Earlier in 2021, we were awarded a £2,800,000 Innovate UK grant to support the phase two clinical development of AT two forty seven. Preparations for that study are ongoing at the moment, and that can start and initiate after we have the results from the current US study, that's ongoing. We also, as I mentioned, we partner with major pharmaceutical and biotech companies, and we entered into five new technology partnerships in 2021. So these are revenue generating but pre licensed at this stage. So offer that upside potential from milestone and royalty bearing licenses.

6:33 And as you can see here from some of the names of the companies that we're able to announce, such as Eli Lilly, Par Pharmaceuticals, and Intas Pharmaceuticals, And we're partnering here with well established and large pharmaceutical companies. And that really does validate the strength and the need for the technology and also our commercial focus. We do we do build relationships with pharmaceutical companies, and we do do deals with them. We've also had some significant, progress across our intellectual property portfolio. I'd note earlier this year, in fact, we had our first US grant of one of our key patents protecting AT two forty seven and AT two seventy eight, which is a part of a much broader strategy, to protect those valuable product assets.

7:21 So just, zooming in a little bit to the technology, just to give you a feel for what the technology platform really is. So as I've mentioned, we're taking products that are suboptimal in some way, applying the Arsat technology platform to develop enhanced or improved versions of these products. So some examples of these are, yes, this is in the case with our insulin products. We can take those products and use our Aristat technology to modulate and change the pharmacokinetic and pharmacodynamic properties. So this means that we're changing how that drug, works, post injection here. And here, we're making accelerating that absorption and making very rapid acting insulins. We very routinely work on taking products out of the cold chain and developing heat stable versions of those products. Obviously, that's been very topical over the last, two years now, I guess, with the COVID vaccines where we saw those first vaccines coming to market requiring minus 80 degrees, so, being stored and distributed on dry ice. So those are the kind of programs that we work on with our partners taking those products out of the cold chain.

8:32 As is the case with our specialty hospital portfolio, we also, work routinely on taking products that are dry powders that require this complex mixing procedure at points of care and developing stable liquid ready to go versions of these products. And we're also seeing very much a trend towards, trying to take patients out of the hospital setting. And one area here that we, work in both ourselves and with our partners is taking products that are currently administered via an IV infusion in the hospital setting and developing very highly concentrated and stable versions of these products that can be delivered then by a single injection and then opening up the opportunity to take that patient out of the hospital setting even to self administration at home.

9:23 So the technology platform itself here, we're taking a suboptimal product. We're applying our stats to develop an enhanced version of that. And, essentially, the platform is a series of tools, and each of those tools is a very specific combination of ingredients or excipients that have been designed and developed by ARECOR to enhance specific properties of a product. So when we work on a program, whether it be an in house development product for ARECOR or one of our partner programs, we start in the same way. The first thing that we'll do is define the target product profile, what are the enhancements of properties that we're looking to achieve. And once we've defined that, we use our, internal expertise and know how to then understand what are the problems that we need to overcome, how what's preventing those enhancements of properties being achieved today. And once we've defined that, we then select specific tools from our platform.

10:23 Each of those tools and each of those combinations of ingredients then being designed to overcome and enhance a specific property. Now these are complex, often biological products that we're working on here. So there's always more than one challenge that we need to overcome. So we'll select those tools that overcome each of the challenges that's required for that particular product. So we might, for example, select tools one, three, and five, for example. We'll combine those together, which means combining all of those ingredients together with the pharmaceutical products within our labs in Cambridge in The UK and and then test that product. So what we're looking for here is are we seeing broadly the enhancements of properties that we'd expect to see. And once we know we're in the right design space, this is where we use our proprietary algorithm, which helps us fine tune and select the exact ratios of those ingredients or excipients that will give us the optimum product profile and the optimum enhancements of properties.

11:25 And using, this process, which is very transferable and scalable, we're able to routinely develop enhanced versions of products that were otherwise unachievable. And as I mentioned earlier, of course, intellectual property is absolutely critical here, and we have over 50 granted patents currently and, of course, a growing and evolving patent landscape. So just moving on to our portfolio, here. So what you're looking at here is a combination of ARECOR's proprietary products in the dark blue and our partnered programs in the orange. So perhaps if we start with our, proprietary products in dark blue, there's a number of important aspects to note here. The first is here that we're taking products that are already on the market and approved such as insulin, and we're using Aristat to develop enhanced versions of these. And this is important because it means that the safety and effectiveness or efficacy of these products is already known. And this means that we can follow abbreviated regulatory and development pathways to market because we're not having to perform those long and often large and clinical studies to demonstrate the safety and effectiveness of the products. Here, what we're doing in our proprietary and clinical programs here are looking at demonstrating the superiority and the clinical benefit to, patients.

12:49 So this means that we can develop these, products in a faster time frame to market and at a lower cost and low risk compared to a traditional biotech model. So as you can see here for our two lead diabetes products, t two four seven and a t two seven eight, and we performed two phase one clinical studies for these products. We're in a second clinical study for a t two four seven, and we plan to enter our next clinical study for AT two seventy eight later this year. And really our strategy here is to develop those data packages that we know that pharmaceutical companies will be looking for for partnering, but also data package which prove that clinical benefit to patients, which will be key for those patients, but also to ensure reimbursement of these products in the market. And here, we'll be looking to take with our partner market share within an existing $6,400,000,000 market, and we'd anticipate these being milestone royalty bearing and partnerships with those pharma partners.

13:56 So perhaps moving on to the specialty hospital portfolio now. I'll start with our partner programs with Hikma Pharmaceuticals. So these products started their life as ARECOR internal products, so they were in our research group. So these are products that we'd selected that were on the market, used in the hospital setting, that these powders that required the complex and mixing procedure prior to use. So for 8282, which is the most advanced of these programs with Hikma, for example, we developed a, stable liquid ready to use version of this product in house at ARECOR, and then we filed intellectual property property protecting that novel formulation and that new format of this product. And it was this at this stage that we entered into a co development and license agreement with Hikma Pharmaceuticals.

14:48 Now here, we're not looking to change clinically how these products work post injection. So this means that we can follow an even further abbreviated pathway to market. It's called a five zero five b two regulatory pathway in The United States. What this means is that, there'll be limited or no clinical data required for approval here. And with our partner, Hikma, and their capabilities and their commercial capabilities to bring these products to market, we'll be looking to take market share within those existing market segments. So around $600,000,000 market, for example, for a t two a two. So, perhaps then moving on to a t two twenty. So this is an example of a pure technology partnership.

15:36 So this is where a pharmaceutical company has come to ARECOR with their proprietary product, and we've developed an enhanced and superior version of that product with the Aristat technology, and they've taken a license to that and taken it forward in development. So AT220 is important because it's likely to be the first product on the market incorporating the Aristat technology. It's in late stage development by our partner at the moment, and we'd anticipate this product, if successful, could be on market from 2023 onwards. Again, this is a royalty bearing agreement to ARECOR in an existing multibillion dollar segment there. So it could be generating a recurring royalty revenue from ARECOR from next year onwards.

16:22 And at the bottom here, you can see those technology partnerships. So these are prelicensed partnerships where we're working on developing those enhanced versions and superior versions of the products for our partners and offer that future upside potential from licensing. So I'm now going to talk in a little bit more detail around our diabetes products. So maybe taking the macro view first, the International Diabetes Federation published their updated statistics for diabetes at the end of twenty twenty one, and they described now diabetes as being in crisis. There are actually around five hundred and thirty seven million adults, living with diabetes, and the cost of treating them and their diabetes complications is just under $1,000,000,000,000 currently. And, sadly, six point seven million people die due to diabetes in 2021.

17:21 And where ARECOR is focused here, we're focused on developing improved insulins to help these people living with diabetes better manage their blood glucose and ultimately improve their outcomes. So I'll try and explain this a little more, in this slide here. So the daily challenge for somebody living with diabetes is to try and maintain their blood glucose inside a healthy target range, which you can see in the light blue in this schematic on this slide. And they can do this through most of the day and night, but the challenge becomes around meal times. So when we eat food, our blood glucose rises very rapidly, and the fact is that the current gold standard best in class insulins on the market today are still not fast enough. There's still improvements to be made there to bring that blood glucose back inside the healthy target range quickly enough and counteract that very swift rise in blood glucose.

18:17 As a result of this, on average, a person with diabetes spends around 25 of their time with their blood glucose too high in hyperglycemia, and about 5% of their time with their blood glucose too low in hypoglycemia. And it's this time spent out of range that leads to really serious disease complications associated with diabetes. So for example, there's a two hundred percent increase in all cause morbidity, and seventy percent of people with diabetes die from cardiovascular disease. So at ARECOR, we're developing two superior insulins, eighty two four seven is an ultra rapid acting insulin where we're really targeting an improved insulin and treatment option for people living with type one diabetes, and I'll I'll talk through the data and why that is in a moment. And eighty two seventy eight, which is our concentrated rapid acting insulin, again, targeting improved treatment for type two diabetics.

19:13 And both of these products are novel formulations of existing insulin and that we've, enabled using the Aristat technology. And as I mentioned earlier, we have a very broad and robust patent strategy protecting these products with our first US grant earlier this year, and we would expect patent protection out until at least 2037. So if I move on to AT 247, I'm going talk you through our clinical data here for this study. So, in this study, it was a phase one clinical study in type one diabetic patients. We're able to go straight to the patient population because we're not having to demonstrate the safety of insulin, so so we could skip the healthy volunteer phase.

19:58 And we were looking at comparing eighty two four seventy two, the gold standard insulins that are on the market today. So both from Novo Nordisk, NovoRapid, which is their rapid acting insulin, and Fias, which is their next generation ultra rapid acting insulin. And if you look first at the graph on the left hand side here, this is the pharmacokinetic curve. So essentially, what you're looking at here is the increase in insulin in the blood in a type one diabetic patient after a single injection of either AT two forty seven in the green, Novorapid in the red, or FIASP in the blue. And I'll I'll talk about these results now in relation to to FIASP as it was the fastest acting comparator within this study. And the first thing you'll notice here is there's a shift to the left of the curve for eighty two forty seven in the green. And what this means is is that we indeed saw an accelerated of absorption of insulin. So insulin was appearing in the blood much faster. Faster. And we also then saw an a significant acceleration of the exposure, so the amount of insulin onboard in the blood, over time, and particularly in that first two hours. And this is an important period where we've eaten food, our blood glucose has risen very rapidly, and we need that insulin on board as quickly as possible post injection.

21:16 So we knew from our pharmacokinetic data that we'd achieved our goal of accelerating these absorption and getting more insulin on board. And then if you look on the right hand side here, this is the pharmacodynamic data. So this is essentially the glucose lowering profile of the insulins. And again, what we saw here is that we'd seen that increase in insulin exposure post injection, and this did indeed result in an increase a significant increase in glucose lowering profile. So we saw a greater and faster glucose lowering profile for AT two forty seven when compared to both NOVA Rapid and FIASP. And the reason we're so excited about this data and and where we see the most patient benefits for AT two four seven. We've proven now against those gold standard insulins in the market that it's a faster acting insulin, that it has a superior glucose lowering profile, and then really has the potential to enable really a transformational treatment option for type one diabetics, is called a fully closed loop artificial pancreas.

22:21 And this is a system as you can see on this slide here where the patient wears a continuous blood glucose monitor. So this monitors their blood glucose measurements at any point in time. These measurements are fed to a control algorithm which calculates based on their blood glucose reading how much insulin they need to maintain their blood glucose inside their healthy target range. And then this insulin dose is automatically administered via the insulin pump. Now this isn't SkyFi. These systems are available today and in use, by patients in real world use, but they're called hybrid closed loop systems. And the reason that they're hybrid systems is that, patient needs to come out of the system at meal times, announce that they're going to have a meal, and instruct the, insulin pump to administer to them a large dose or a bolus dose of insulin.

23:17 And the reason for this is, as I was explaining earlier, those gold standard insulins are still not fast enough acting, still don't respond quickly enough in real time to that swift rise in blood glucose to bring, the individual back into their healthy target range quickly enough. So there's a real need here for these systems for a much faster acting insulin to enable the system to be used throughout the day and night, including at meal times. And this is really considered the holy grail for people living with type one diabetes. It's well demonstrated that the time that they spend within the closed loop, system that that improves their time in range, so improves their time spent in their target blood glucose range and ultimately then improves their outcomes. So there's real potential here, the eighty two four seven to enable this system.

24:09 And the study that's ongoing in The US at the moment is delivery of eighty two four seven comparing again with NovoRapid and Fias over once administered continuously over three days via an insulin pump. So that will start to give us some data around the compatibility with the insulin pumps and the superiority again of the PKPD profile is what we'll be looking to achieve there. And that can lead to then a longer term study where we can start measuring time and range, for example. So just moving on to a t two seven eight just to explain the difference between the two products. So again, we've taken existing insulin, and we've used the ARECAST technology. In this case, developed highly concentrated, So it's five hundred units per mil, which is five times the concentration of standard insulins.

24:58 So in the eighty two four seven study, eighty two four seven is a 100 units per mil as are all the comparators, there. But we've used the technology to make this very rapid act And the need here is that there is a growing number of people with diabetes, particularly type two diabetics, who are requiring high daily doses of insulin to control their blood glucose, and this really goes hand in hand with the obesity pandemic. And currently, there are no concentrated rapid acting insulins available for this patient population. So essentially for them, currently, they have two choices. They can either select one of the gold standard rapid acting or ultra rapid acting insulins that are available to them today. So this provides them with good blood glucose control, but it means that they have to administer very high daily doses through high injection volumes, which can be uncomfortable and painful and by multiple injections multiple times a day.

25:57 Or they can select the only other concentrated insulin on the market, which is also at five hundred units per mil, so the same concentration as a t two seven eight. But this is a more intermediate acting insulin. So it's a slower acting insulin. So they get all the benefits of lower injection volume, fewer injections per day, however, compromising on blood glucose control and hence, ultimately outcomes. So with AT two seventy eight, what we're looking to achieve here is very concentrated but very rapid acting insulin. So essentially, the patients then can have the best of both worlds. Lower injection volume, fewer injections a day, but not compromising on their blood glucose control and outcome. And the challenge here essentially is as you concentrate up insulin, it becomes slower acting.

26:47 So we've been able to use our technology to overcome this, and we have a market leader position here as far as we're aware. We're the only company, certainly clinically, that's demonstrated being able to achieve this sought after profile, this concentrated rapid acting insulin profile. And I'll just talk you, through the results. This is these results are actually hot off the press. They were, presented for the first time last Thursday at the diabetes conference here. And what we were looking to achieve here, we're looking at eighty two seven eight at 500 units per mil comparing pharmacokinetics and pharmacodynamics compared with NOVA RAPID, which is NOVA Nordisk rapid acting insulin, which is a 100 units per mil. So we've got a fivefold difference in concentration here.

27:37 And again, what you're looking at on this slide is the pharmacokinetic data. So this is the increase in insulin in the blood post, a single injection to type one diabetic patients. And you'll notice that what we were looking to achieve, what the primary endpoint for this study was, that it would be non inferior to NovoRapid despite that increase in concentration. And we met that primary endpoint in fact or secondary endpoints in the study. But you'll also notice there is, like, again, a shift to the left, the a t two seven eight. So we not only achieved a non inferiority, but we also in achieved superiority

28:13 in terms of that acceleration of absorption, so the onset of appearance of insulin in the blood and also the amount of insulin over in blood over time in that first sixty minutes. So we saw a fourfold increase in insulin exposure, so four times more insulin on board in the first thirty minutes post injection and one and a half times more insulin on board in the first sixty minutes post injection for eighty two seventy eight but versus NOVA Rapid. So this really is very exciting profile here. And as I mentioned, we have a market leader position as the first concentrated rapid acting insulin. And then if we look at the pharmacodynamic data, so this is the glucose lowering profile. Again, we saw a faster onset of action of glucose lowering, so it started lowering glucose much more quickly. We saw a very dramatic nine fold increase in glucose lowering in the first thirty minutes and a two fold increase in the first sixty minutes. So we know here that post injection, you've eaten food, inject your insulin, and it starts bringing down that blood glucose much faster and to a much greater extent here.

29:25 So I'll just draw your attention, to an event that's coming up actually at the end of this month, which you may be interested in attending. If you are, please do get in touch, and we'll make sure you receive the link. So this is key opinion leader event, where professor Thomas Peeber will be talking through the a t two seven eight clinical data in much more detail than I have today. And then we have a panel of world leading experts within the diabetes space who will talk through the patient need for more concentrated rapid acting insulin. So as I said, I think it'd be really interesting and insightful event if anybody would like to join that. So just moving on here in terms of key upcoming milestones. As I mentioned, for AT two forty seven, we're currently in the middle of a U. S. Clinical study. This is a three day insulin pump study. We'd expect to be reporting headline results in the second half of twenty twenty two.

30:26 And then for AT-two seventy eight, on the back of our results, which were very much at the high end of our expectations that we're looking to initiate our next study here, and that will be looking at AT-two seventy eight in the target patient population, so in the Type two diabetic patient population.

30:47 So I'm just going to hand over to Susan to talk through the financial highlights. Thank you, Sarah, and good morning, everyone. ARECOR's admission to AIM occurred on the 06/03/2021. We raised new investment of GBP 20,000,000 from existing and new shareholders. The proceeds raised are to progress our proprietary development pipeline. At admission, had a share price of £2.26 and a market cap of £62,500,000 Our 2021 P and L shows that we have a commercial focus with total income of £1,800,000 derived from revenue and grant income. R and D investment increased to $5,400,000 in 2021 and we expect this to increase further in financial year 2022.

31:37 Our R and D expenditure this year will include The U. S. Phase one study for which is in progress, plus a second study for AT-two seventy eight in the second half of this year. Our cash at December 31 was CAD18.3 million compared to CAD2.9 million in the prior year and our balance sheet was further strengthened with the conversion of $4,400,000 of shareholder loan notes into ordinary shares at a 10% discount to the IPO price. Our key financials, we recognize revenue from our technology partnerships in two ways. Formulation development revenue is recognized as the projects are performed. And as you'll see our 2021 recognition of 1,200,000 prior year.

32:25 This included revenue recognized against five new technology partnership agreements signed in the year and agreements signed in prior years. Our formulation development project represent future licensing opportunities. 2020 prior year revenue included the recognition of licenses and milestones, which are periodic in nature. Revenue is recognized at a point in time when a milestone is achieved or a license is granted. Our other income of GBP 600,000 was derived from the Innovate UK grant award in March 2021 and we have GBP 2,200,000 of grant income to be received over the remaining project term. Our improved net assets position at the end of twenty twenty one primarily reflects cash.

33:15 We also have an R and D tax credit receivable of CAD0.8 million and CAD1.4 million receivables from formulation development projects. Our payables of 2,100,000 included accruals of 1,200,000 related to The U. S. Clinical trial, which became cash outflows in early twenty twenty two.

33:38 Back to you, Sarah. Thanks, Susan. So just to round off for today, hopefully, we've given you a a good overview of ARECOR or platform technology and also our partner programs and proprietary products. I think as you can, see here, we met a number of really significant milestones in 2021 based clinically across our proprietary portfolio. Obviously, our successful AIM IPO raising £20,000,000 and continued progression across our technology partnering portfolio, and we're certainly taking that momentum into this year. So things to look out for really in 2022 would be the clinical results from our three day insulin pump study for AT two 47, which we'll be reporting in the second half of this year. The initiation of that important type two diabetic study for AT two seventy eight We expect to hit our next license milestone under our HICMA AT 282 co development and licensing agreements and also advance that portfolio of specialty hospital products that ARECOR is working on internally here, and we're looking to progress those in generating the data and the intellectual property to lead to more Hikma type, licensing deals. And we would certainly expect to see continued technology and partnering growth, through the year as well.

35:06 So that concludes, the presentation for today. But, of course, we'll be happy to take, any questions that you have. Sarah, Susan, that's great. And thank you very much indeed for your presentation this morning. Ladies and gentlemen, please do continue to submit your questions just by using the q and a tab that's situated on the right hand corner of your screen. But just while Sarah and Susan take a few moments to review those questions submitted already, I would like to remind you that a recording of this presentation along with a copy of the slides and the published q and a can be accessed via your investor dashboard. Susan, Sarah, as you can see, we've received a number of, presubmitted questions as well as a number of questions have been submitted, during today's presentation. Firstly, can I thank all investors for submitting their questions? And, Susan, sir, if I could please hand back to you just to read read out those questions and give a response where it's appropriate to do so, and then I'll pick up from you at the end.

36:00 Sure. No problem. Thank you, Jake. So the first question that was submitted says, given Novo Nordisk long established market position in producing insulin, why is the pharmaceutical company not able to adjust the composition stroke formulation of its existing insulin products in order to improve the PKPD profile? And following on from this, is any of the excipient stroke ingredient used by ARECOR's AT-two seventy eight or AT-two forty seven available only to ARECOR. So I think in the first part of that question, so Novo Nordisk have used the formulation approach to develop a second generation version of their insulin. So their first products on market is Nova Rapid, which is a rapid acting insulin.

36:48 And they have further developed FIAAS, which is a reformulation of Nova Rapid essentially to develop an ultra rapid acting insulin version. So there's very much a drive from the major pharmaceutical companies and an understanding really of that need for patients that they do need more at faster acting insulins, particularly those type one diabetic patients that are looking to use artificial pancreas type systems. And as you would have seen from our clinical data, so that was a phase one clinical study head to head with NOVOs, NOVA Rapid and FIAAS, we've been able to further and significantly improve on that profile to develop a faster acting insulin with a greater group glucose lowering profile compared to FIASP there. So I think, again, we see our insulin as that next generation moving towards more physiological insulin that acts more like a healthy person's response to an increase in blood glucose.

37:51 In terms of those excipients, could they be used by others? The barrier to entry here essentially is ARECOR's intellectual property. We filed extensively protecting, the formulations and the compositions of a t two four seven and a t two seven eight as well as methods of use as well. And as I mentioned, we had our first US grant for one of those key patents protecting those formulations of AT two four seven and AT two seven eight. So that would be the barrier to entry in preventing either Novo or Lilly or or any biosimilar companies essentially copying ARECOR's approach. So the next question is how do the partnerships work with the likes of Eli Lilly?

38:41 How are your partnership deals structured, and what is the revenue profile? So I'm assuming I think this is referring to the technology partnerships as you would have seen from the slides. We do have a a partnership with Eli Lilly on one of their proprietary products. So these are structured in a way that, there's a development program that's agreed with our partners where we're applying the Aristat technology to

39:09 look to achieve a predefined target product profile, so an enhanced profile that we've agreed with them. So our partner will pay ARECOR to perform those studies, and you've seen from Susan's slides and the headlights financials, the kind of magnitude of those revenues to ARECOR. And then, on completion of the study, our partner then has the option to, take a license to that formulation. So that's a license to allow them to further develop and commercialize that novel combination of ingredients, as applied to their product. And also a license to the ARECOR intellect ARECAST intellectual property that they need then to, further develop and commercialize that product.

39:57 And they tend to be milestone and royalty bearing agreements. To give you some sense of of value, because that's probably the follow-up question to this answer. For our proprietary programs where we're developing them, we're investing in those. We're developing those closer to market and generating those data packages, including clinical packages for our diabetes products, we'd expect those royalties to be in the mid single digit to double digit range on commercial sales. For technology partnerships where ARECOR isn't investing, of course, our own capital, and we're applying our technology and our partners paying for for those from day one. You're looking at more in a single digit range on the royalties

40:42 there. And then, of course, the absolute value of those depends on market size of the product and our partners' success in capturing market share. The next question is what do you believe differentiates ARECOR from its competitors, especially in attracting new partnerships? I mean, I I think the key here essentially is that our core USP is that we can use our innovative and proprietary Aristat platform to, deliver and develop enhanced versions of therapeutic products that are otherwise unachievable. So that really drives our partners to us because they would have always these are large pharmaceutical companies. They would have always attempted to achieve that target product profile themselves.

41:34 So they come to us when they're looking for a technology approach, something over and above standard approaches to formulation science essentially. And that's really what drives our licensing model that under those partnerships, there's a recognition of the value that ARECOR's bringing to the table, which then obviously converts into the the upside potential of those milestone royalty bearing licenses. So the next question is any major impact of the Cmax being slightly lower for AT than with Nova Rapid? I think it's probably referring to eighty two seven eight there. And actually, for eighty two seven eight versus Nova Rapid, there was no statistical relevance of differences, of that Cmax. They are, in fact, very close and and on those p values, very close on those on the, statistical relevance. So there's there's no clinical difference between the Cmaxs for those two products.

42:41 So next is oh, I'll read out the compliments. Great progress to date. Thank you. And what near term catalyst news flows can we expect, and what do you see as the ongoing r and d cost? I'll take the first half of that question, Susan, and then I'll hand over to you the second half. So, you know, I think in terms of near term catalysts, here, we have some clinical catalysts upcoming. So those, results, clinical results from the current three day insulin pump study in The US for eighty two four seven will be a key catalyst. You know, that's in the patient population using the intended delivery mode, so delivered by continuous infusion and insulin pump there. So we certainly see that as, you know, further validating the superiority of that product.

43:33 Clearly initiating our next clinical study in the type two patient population for AT two seventy eight as well will be a milestone then leading to, a readout, of those studies, which, will, likely come outside of 2020 to there. And across the portfolio, I think we'd expect to see additional partnering growth in terms of both our current partners and products under license progressing closer to market, but also our technology partnerships with pharma moving towards those licensing stage and more technology partnerships coming on board through the year. And so I hand over to you, Susan, to talk about the ongoing R and D costs, please. Thank you, Sarah. In terms of our and D cost for 2022, we do expect that to increase.

44:26 As I said earlier, we're running cost of two studies in this year, and we expect that to probably reach double digit millions. On an ongoing basis, we will certainly be in single digit millions, and that figure will effectively flex depending on the timing of those clinical studies. Thank you. Thank you, Susan. I think that's the last question at the moment under the q and a. But if anybody Absolutely. Has any additional ones, we'd be happy to take those. I will just give it just a moment to see if there's any questions that come in. Okay. Perfect. Sarah, Susan, thank you very much indeed for taking the time to address all of those questions that came through. And, of course, if there are any further questions submitted today, we'll make these available to you, immediately after the presentation has ended. And ladies and gentlemen, we'll publish all those responses where it's to do so on the Investor Meet company platform. And we'll notify you by email when these are ready for your review.

45:22 Sarah, Susan, perhaps we're redirecting investors to provide you with their feedback, which I know is particularly important to yourselves and the company. If I could just ask you for a few closing comments to wrap up with, that'd be great. Yeah. No. Thank you, Jamie. Thank you everybody for, you know, taking the time to join us today. I think as you've seen, you know, we've as a company, we've evolved and, you know, being able to use that technology to develop these enhanced versions of therapeutic products. And I think we really do have the potential here to bring products to market with our partners that can transform patient outcomes and quality of life, which really is the purpose of ARECOR. And in doing so, we should be able to build a large and self sustaining biopharmaceutical company, which is ultimately our strategic aim here.

46:09 So, yeah, thank you for taking the time, and we look forward to engaging with many of you in the future. Sarah Sarah, Susan, that's great. And thank you very much indeed for updating investors today. Could I please ask investors not to close this session as you'll now be automatically redirected for the opportunity to provide your feedback in order that the management team can better understand your views and expectations? This will only take a few moments to complete, and I'm sure will be greatly valued by the company. On behalf of the management team of ARECOR THERAPEUTICS PLC, we'd like to thank you for attending today's presentation. That now concludes today's session. So good morning to you all.