Good day, ladies and gentlemen, and welcome to the Gossamer Bio Second Quarter 2019 Earnings Conference Call. [Operator Instructions]. As a reminder, this conference is being recorded. I'd now like to turn the conference over to Bryan Giraudo, Chief Financial Officer. Mr. Giraudo, you may begin.

Thank you, operator, and thank you all for joining us this afternoon. With me on today's call are Gossamer Bio's co-Founder and Chief Executive Officer, Dr. Sheila Gujrathi; as well as Gossamer's Chief Medical Officer, Dr. Jakob Dupont. Earlier this afternoon, Gossamer Bio issued a press release announcing its financial results for the second quarter ended June 30, 2019, and provided a corporate update. Please note that certain information discussed on the call today is covered under the safe harbor provision of the Private Securities Litigation Reform Act. We caution listeners that during this call, Gossamer management will be making forward-looking statements. Actual results may differ materially from those stated or implied by these forward-looking statements due to the risks and uncertainties associated with the company's business. These forward-looking statements are qualified by the statements contained in Gossamer's news releases and SEC filings, including the annual report on Form 10-K and subsequent filings. This conference call also contains time-sensitive information that may be accurate for only a limited period of time. Gossamer Bio undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call. Now I'd like to turn it over to Sheila. Sheila?

Thank you, Bryan, and good afternoon to everyone joining us on today's call. Here at Gossamer, we are focused on discovering, acquiring, developing and commercializing therapeutics in the disease areas of immunology, inflammation and oncology. Our goal is to be an industry leader in each of these therapeutic areas and to enhance and extend the lives of the patients suffering from such diseases. We are working to achieve this vision by focusing on building a diversified immunology portfolio with multiple meaningful shots on goal. To that end, over the past few months, the Gossamer team has delivered on a number of critical clinical development milestones along our journey towards benefiting patients. On today's call, I'm going to walk you through the updates and milestones achieved for 3 of our 4 clinical stage programs before handing it over to our Chief Medical Officer, Jakob Dupont, for a discussion of our newest clinical asset, GB1275. Bryan will then discuss Gossamer's financial update. Following which, I will provide a few closing remarks. Let's begin with our most advanced clinical stage product candidate, GB001, an oral DP2 antagonist, which we are developing for eosinophilic asthma and other allergic conditions, including chronic rhinosinusitis both with and without nasal polyps and chronic spontaneous urticaria. As you may recall, our Phase IIb trial in moderate to severe eosinophilic asthma, known as the LEDA study, began enrolling patients in October of 2018. LEDA is a global Phase IIb study, testing once-daily dosing regimen of GB001 over a 24-week treatment period. All patients will remain on background therapy throughout the study, and the primary endpoint is a composite measure known as asthma worsening. We are happy to reaffirm that enrollment in the study remains on track to trigger an interim analysis in the first half of 2020. After this…

Thank you, Sheila, and good afternoon, everyone. Today, I'm delighted to discuss with you our most recent product candidate to advance into the clinic, namely GB1275 for the treatment of cancer. GB1275 is an oral CD11b modulator being developed as an immuno-oncology product candidate focused on addressing the immunosuppressive myeloid cell populations present within tumor tissues. CD11b, which is the target of GB1275, is broadly expressed on most suppressive myeloid cells, including macrophages, monocytes, neutrophils and some dendritic cell subsets. This myeloid suppressive biology is particularly pervasive in tumor types that are refractory and resistant to checkpoint inhibitor therapy, such as anti-PD-1 antibodies. These tumor types include pancreatic, colorectal, prostate and other significant cancer indications. In preclinical studies, modulation of CD11b reduces trafficking of these suppressive immune cells into tumors, and importantly, also converted or repolarized those in the tumor micro environment from a suppressive state to a pro-inflammatory anti-cancer state. With GB1275, we seek to address the unmet medical need of these cancers that are generally not responsive or minimally responsive to current checkpoint inhibitor immunotherapy. Before we discuss our Phase I/II clinical trial of GB1275, I'd like to call your attention to a publication that we posted on our corporate website on July 3, the paper entitled Agonism of CD11b reprograms innate immunity to sensitize pancreatic cancer to immunotherapies. And this was authored by David DeNardo's lab at Washington University in St. Louis and Vineet Gupta's lab in Rush University and was published as a feature cover article of the July 3 edition of Science Translational Medicine. The publication, which outlines some of the key data that made us excited about the potential of GB1275 in difficult-to-treat cancer types, has driven significant interest from KOLs and top-tier clinical institutions that would like to be involved in our clinical…

Thank you, Jakob. We'll now review the financial results for the second quarter of 2019. We ended the quarter with $464 million of cash and cash equivalents. And as a reminder, we announced $150 million debt facility led by MidCap Financial this past May. $30 million of that facility was taken down at the closing of the agreement and $120 million will become available to Gossamer, subject to the achievement of certain clinical miles -- clinical development milestones and customary conditions. We continue to anticipate our cash and cash equivalents, plus the capital available to us in the debt facility will provide us sufficient resources into the second half of 2021. Research and development expenses in the quarter were approximately $35.7 million, which reflects a ramp-up expenses for GB001, GB002, GB004 and GB1275. In-process R&D expenses, which consist of costs related to the acquisition and licensing of our product candidates, were approximately $1 million for the quarter. G&A expenses were $9.7 million in the quarter with nearly $2.7 million of that total being in stock-based compensation. Our net loss for the quarter was $44.5 million, equating to $0.74 per share. With that, I'll turn the call back over to Sheila to offer some closing comments before we open the line up for Q&A. Sheila?

Thank you, Bryan. We take enormous pride in the progress we've made towards building a diverse portfolio of assets, targeting indications with high unmet needs. And we are equally thrilled with the advancement of those product candidates within their respective clinical development program. Our Gossamer team has taken our vision and purpose to heart, positioning our company to continually drive our expertise in immunology, inflammation and oncology for the benefit of patients, caregivers, physicians, shareholders and employees alike. Thank you for taking the time to join us today and for your continued interest and support of Gossamer Bio. With that, I will now turn the call over to the operator to begin the question-and-answer session. Operator?

[Operator Instructions]. Our first question comes from Joseph Schwartz with SVB Leerink.

Congrats on all the progress. I was wondering if I could get your thoughts on how you interpret Novartis' delay of their Phase III data for fevipiprant and how, if at all, it will impact your strategy.

Thank you, Joseph. Yes. So earlier this year, Novartis did announce a delay in terms of -- originally they had outlined they will be reading out top line data from 4 of their clinical Phase III trials that they are conducting with currently, the fevipiprant by the end of this year. They revised that guidance to state that 2 of their Phase III trials would be reading out by the end of this year and 2 would be reading out in the first quarter of 2020, namely there are 2 trials that are really characterizing lung function and a more moderate asthma population, ZEAL 1 and 2, will be reading out in the year; and LUSTER-1 and 2, which are really their exacerbation trials, will be reading out in the first quarter 2020. So we don't really view this as a significant impact to our program, and that is very much in the similar time frame. I think they just wanted to get all of their data together and be able to report out simultaneously from what we understand from the earnings call. And I think what's most critical to relay to our investors is really the differences in the trials is that ZEAL 1 and 2 are lung function trials going into less severe patient population. And really, we're very focused on the readout for LUSTER-1 and 2 since those are a very similar trial population as to what we're enrolling in LEDA. So just to remind everyone, LUSTER-1 and 2 are enrolling moderate to severe eosinophilic asthmatic patients as well as noneosinophilic asthmatic patients but the severity is set 4 and 5, which is the same population that we're enrolling in terms of the disease severity in LEDA. So I think we're really focused on the outcomes of LUSTER-1 and 2, which will hopefully be happening at the beginning of next year. But really all eyes are looking forward. We're very focused on execution of the LEDA trials we've discussed and very excited about the progress of the program.

That's very helpful. And then on GB002, I was wondering if you could talk a little bit about the efficacy biomarkers you'll be collecting and what you hope to see there and how you plan to go about determining the optimal dose level and schedule in Phase Ib.

Sure. Yes. Very -- again, very exciting Phase Ib trial we're running with GB002. It's primarily a trial that will be, of course, looking at safety, tolerability and pharmacology. GB002 is in PAH patients, which is something we very much want to do before initiating our Phase II/III registration-directed trial. But we have growth in a lot of different elements to get at that translational aspects of the trial. And so some of the exciting measures that we've discussed before with you, Joseph, as well as with many of those on the phone are really looking at very exciting biomarkers, NT-proBnP levels are something that we have already seen changes on in the preclinical setting and disease animal models that really characterize and closely mimic human PAH biology. We've also seen evidence of impact of those biomarkers with imatinib in their Phase III trials that were very successful in PAH patients. So we are very excited to be able to characterize NT-proBnP levels. In addition, we're looking at other target engagement assays that would get at our understanding of the PD effects of GB002, including gene expression signatures and other assays that we've outlined, some that affects actually even other markers of disease. And lastly, we'll be looking at cardiac imaging. So echocardiogram, cardiac MRI and scans that will be really assessing left ventricular ejection fraction and other cardiac hemodynamic parameters from the study. So it should be a really rich study with a lot of biomarker as well as imaging. And of course, we will be looking at [indiscernible] difference. But given the short duration of the trial, we're not really anticipating any significant clinical effects at this time.

[Operator Instructions]. Okay. And this ends our question-and-answer session for today. On behalf of Gossamer Bio management, thank you for your participation in today's conference. This concludes the program. You may now disconnect. Everyone, have a wonderful day.