Veradermics Study result

Please go ahead. Thank you, operator, and good morning, everyone.

Thank you for joining us to discuss Veradermics' positive top-line results from Part B of Study 302, our phase II/III trial of VDPHL01 in males with mild to moderate pattern hair loss. This morning's press release is available on the Investors section of our website. We will also post the slides used today following the conclusion of this call. Joining us on the call today are Dr. Reid Waldman, our Chief Executive Officer, Mark Neumann, our Chief Commercial and Strategy Officer, and Dr. Michael Gold, founder of Gold Skin Care Advanced Aesthetics Medical Spa, The Laser and Rejuvenation Center, and the Tennessee Clinical Research Center. Dr. Gold was also an investigator in Study 302 and is a paid consultant of Veradermics. Reid will begin with opening remarks and present the results from Part B of Study 302.

You'll then hear from Dr. Gold about his experience treating pattern hair loss and what today's results could mean for patients across his practice. Mark will then provide commentary on the commercial opportunity of VDPHL01, and we'll close the call with remarks from Reid, followed by Q&A. Before we begin, I'd like to remind everyone that today's discussion, including the question-and-answer portion, will contain forward-looking statements. Any statement that relates to expectations or predictions of future events, results, or performance is a forward-looking statement. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Please refer to the forward-looking statements section in today's press release and our most recent SEC filings for a discussion of these risks. With that, I'll turn the call over to Dr. Reid Waldman.

Thank you, Dom, and good morning, everyone. We're very excited to join you today to present the top-line results from Part B of Study 302, the six-month dose-controlled extension period for Study 302. Study 302 Part B had two key objectives: one, to assess long-term 12-month safety and tolerability, and two, to assess durability of hair growth over 12 months of continued dosing. We are extremely pleased to announce that we've achieved both of these objectives, and we believe the data demonstrated a profile of long-term tolerability out to 12 months with no new safety signals, no treatment-related SAEs, and no AESIs of cardiac origins, and deepening or maintenance of hair growth in the continued treatment group. The placebo cross group also demonstrated consistent and clinically significant hair growth with no new safety signals during Part B of the study.

We believe that the demonstration of maintained tolerability and the potential for deepening of hair growth through 12 months of treatment further supports VDPHL01 as a potential new standard of care for pattern hair loss that, if approved, could provide an option to achieve pattern hair loss treatment goals of both patients and physicians. As you all know, pattern hair loss transcends being aesthetic. It is deeply personal, it is deeply psychological, and it is essentially universal. It is the single most prevalent chronic dermatologic condition in America, affecting approximately 80 million people. That makes it 10 times more prevalent than psoriasis and twice as prevalent as both atopic dermatitis and psoriasis combined. That includes roughly 50 million men who have not had a new oral treatment in roughly 30 years, and approximately 30 million women who have no FDA-approved oral treatments, no FDA-approved prescription treatments.

The treatments that do exist today are slow, they are inconsistent, and they force patients to choose between side effects like erectile dysfunction, decreased libido, or messy topical application twice daily for the rest of their lives. For those of you unfamiliar with the story, we are developing VDPHL01 as an oral non-hormonal treatment for both males and females with pattern hair loss. VDPHL01 is an oral minoxidil extended-release tablet, and the premise is very straightforward. Minoxidil is validated biology for the treatment of hair loss, as it is approved as a topical for both male and female pattern hair loss. It also exists as an oral blood pressure medication that is used off-label for hair loss. The problem with that blood pressure medication is that it does exactly what you would expect a drug that is intended to rapidly lower one's blood pressure to do.

It spikes quickly in the plasma, the majority is gone within two hours, almost all of it within four hours, and those spikes drive the cardiac effects of minoxidil, but they are not required, nor are they conducive to hair growth, as they do not provide consistent and durable exposures of minoxidil at the follicle throughout the day. We initially set out the goal of optimizing minoxidil for oral administration, maximization of hair growth, and minimization of cardiac risks via the development of an extended-release tablet that provides consistent and durable exposures of minoxidil to the follicle throughout the day while blunting those peak plasma concentrations that drive cardiac effects. In addition to enabling the delivery of more minoxidil for longer, we believe we can drive hair growth by driving the bioactivation of minoxidil to its active metabolite, minoxidil sulfate.

As many of you know, minoxidil itself has no effect on the hair follicle, its sulfate metabolite does. Minoxidil is activated to minoxidil sulfate in the outer root sheath of the hair via the SULT1A1 enzyme. That enzyme, like many enzymes, is capacity-limited, meaning it can saturate, and it is time-dependent, meaning it takes time to sulfate the minoxidil. So when you think about the PK profile of that immediate release blood pressure medication, minoxidil, it spikes quickly, overwhelming and saturating that sulfotransferase enzyme, and then it is gone quickly, resulting in limited exposure to the enzyme and limited potential time for sulfation. Whereas, with an extended release tablet, we can provide a consistent and durable exposure to the follicle in an attempt to drive that bioactivation of minoxidil sulfate and potentially to drive additional hair growth.

Before we get into the data, let's talk about the study design of Study 302. Study 302 is our phase II/III trial in male pattern hair loss. It enrolled 519 subjects aged 18 to 65 that have mild to moderate pattern hair loss. These subjects were randomized to receive either VDPHL01 8.5 milligrams twice daily, VDPHL01 8.5 milligrams once daily, or placebo at 44 sites across the U.S. Following completion of part A of the study and an evaluation of the co-primary endpoints at month six, participants originally randomized to active continued on their initial dose regimen, while those randomized to placebo were re-randomized to receive either once or twice daily VDPHL01 for a dose control and extension period from month 7 to 12. Now let's look at the baseline characteristics. The baseline characteristics in Study 302B looked markedly similar to what we've previously seen in Study 302A and 304A.

We had strong continuation rates from part A to part B, with lower part A discontinuations in the active groups compared to placebo. The primary objective of Study 302B, as mentioned, was to assess 12-month safety for continued treatment with VDPHL01, and the goal of this longer-term 12-month safety characterization was to assess whether new events were detected after six months of additional dosing. We are extremely pleased that in Study 302 part B, we observed 12-month long-term safety and tolerability results that were consistent with our goal of minimizing cardiac risk. Specifically, we observed no treatment-related SAEs and no AESIs of cardiac origin, so no pericardial effusion, no pleural effusion, no heart failure, no angina. We also continued to see no clinically meaningful vital signs and no clinically meaningful ECG changes.

Importantly, as we expected based on minoxidil's mechanism of action, the generally mild adverse events that did occur primarily occurred early in the course of treatment and were captured in part A. In fact, no AE-related study discontinuations, no cases of edema or shedding, and minimal additional reports of hypertrichosis occurred in part B in the VDPHL01 continued group. These data are very exciting to us, and we believe that the results from 302B strongly support the 12-month long-term safety and tolerability that can position VDPHL01 to become a new standard of care for pattern hair loss if approved. Now let's turn to hair growth from part B of Study 302. As a reminder, the primary efficacy endpoint for Study 302 was measured at six months, and so 12-month hair growth data is exploratory in nature and intended to assess for durability of hair growth over time.

As mentioned, our male phase III program utilizes two co-primary endpoints, both assessed versus placebo at month six in part A, with continued evaluation of the same measures through month 12. The first is target area hair count, or TAHC. This is a quantitative and objective metric, and it's the only measurement methodology that's been used to support FDA approvals in the U.S. in pattern hair loss since 1997. It measures the number of hairs that are greater than 30 microns, or what we call non-vellus hairs, in a given square centimeter. The way we measure it is very specific. We tattoo a small area of the scalp to ensure we're measuring the same spot every time. We then clip the hairs so we can visualize every hair in the area and take a close-up, high-resolution standardized photograph.

That image is then analyzed with a validated digital image analysis algorithm that aligns the image to ensure we're in the exact same spot every time. It measures the width of the hairs, and then it counts those hairs that are greater than 30 microns in diameter. Those counts then undergo an independent review by two separate technicians. Our second co-primary endpoint is the patient-reported outcome. Here, participants compare standardized photographs of their scalp at baseline to standardized photographs of their scalp at follow-up, and they rate their hair coverage on a seven-point scale from much worse to much improved. The PRO is a responder analysis, where we're looking at the percentage of subjects who rate themselves as improved or much improved.