Arcturus Therapeutics Third Quarter 2026 Earnings Call - ARCTURUS THERAPEUTICS HOLDINGS INC

Explicit Guidance:

• Financial Runway: Maintaining a cash runway of over two years through year-end 2028.
• ARCT-2601 (OTC Deficiency): Initiate Phase 2 dosing in Q1 2027 (specifically "next quarter" relative to Q3 2026); report top-line data in H2 2027.
• ARCT-032 (Cystic Fibrosis): Complete enrollment of Cohort 4 (up to 20 patients) by year-end 2026; present full Phase 2 data in Q2 2027; top-line data available prior to the full data presentation in Q2 2027.
• ARCT-PKU (Phenylketonuria): Submit Investigational New Drug (IND) application in H2 2027.
• CoStaVE (Vaccine): Execute commercial objectives in the EU and UK in 2027.
• Thermo Fisher Collaboration: Decision to advance ARCT-032 to Phase 3 to be made when top-line data is available (prior to Q2 2027 full presentation).

Business-Segment Outlook:

• Liver Therapeutics (OTC): ARCT-2601 utilizes Lunar 2.0 platform, demonstrating 38-fold potency improvement in non-human primate models versus original Lunar formulation; aims to enable lower/less frequent dosing. Plan to enroll up to 6 patients in Phase 2 to establish proof-of-concept and inform Phase 3 design; targeting patients with elevated baseline ammonia/glutamine.
• Respiratory (CF): Cohort 4 evaluates 10 mg inhaled ARCT-032 for 12 weeks in Class 1 CF subjects; enrollment accelerating via sites in Israel and Turkey. Confidence in 12-week window to capture clinical signals (FEV1, LCI, quality of life, HRCT).
• Genetic Diseases Expansion: Lunar 2.0 platform enabling expansion into PKU (liver-produced functional PAH enzyme) and gout.
• Vaccine (CoStaVE): Self-amplifying mRNA COVID vaccine commercialized in Japan for 2026-2027; marketing authorization rights transferred to Arcturus in EU/UK; planning commercial activities in EU/UK in 2027, seeking partner for US market.
• Oncology: Leveraging MyNeo acquisition for neoantigen design capabilities; open to partnerships for personalized neoadjuvant vaccines, but primary focus remains on therapeutic pipeline execution.

Market and Competitive Outlook:

• Competitive Landscape (CF): Arcturus differentiates via inhaled home administration (vs. competitor Vertex's failed mRNA program requiring daily clinic visits and systemic steroids); no severe safety events or SAEs triggered in current cohort.
• Platform Differentiation: Lunar 2.0 technology offers significant potency gains, reducing dosing frequency and broadening disease applicability.
• Regulatory Strategy: Utilization of CF Foundation's "REACH" natural history study to potentially minimize patient numbers in Phase 3 and serve as external control data; aiming for FDA discussion in H2 2027 regarding Phase 3 protocol design.
• Pricing/Commercial: Regaining strategic control of vaccine portfolios allows for direct commercial execution in EU/UK and partnership negotiations in the US.

Macro / Industry Outlook:

• Regulatory Pathway: Favorable feedback received from FDA Type C meetings regarding ARCT-2601 and Lunar 2.0; confidence in FDA agreement on endpoints (ammonia and glutamine reduction) and study design.
• Pandemic Preparedness: Continued opportunity for non-dilutive funding (e.g., BARDA grants) for pandemic preparedness contracts utilizing self-amplifying mRNA technology.
• Technology Trend: Broader industry shift toward single-dose pandemic responses and neoantigen design; Arcturus positioning self-amplifying mRNA as a key differentiator for next-gen vaccines.

Strategic Initiatives:

• Acquisition (MyNeo): Completed acquisition to integrate AI-driven antigen design, mRNA optimization, and target identification capabilities; accelerates pipeline development in oncology and therapeutics.
• Technology Launch: Introduction of Lunar 2.0 delivery platform; data shared with FDA showing translational predictivity from non-human primates to humans.
• Portfolio Restructuring: Termination of CSL Securus collaboration; regained full control of CoStaVE and broader vaccine portfolios; shift of marketing authorization rights in EU/UK to Arcturus.
• Pipeline Expansion: Developing new mRNA therapies for PKU and gout; advancing oncology capabilities via MyNeo integration.
• Timeline: IND filing for PKU in H2 2027; Phase 2 for ARCT-2601 starting Q1 2027.

Risks and Headwinds to Outlook:

• Clinical Translation: Uncertainty regarding whether the 38-fold potency improvement observed in non-human primates will fully translate to human clinical efficacy for ARCT-2601.
• Regulatory: IND approval delays or FDA disagreement on Phase 3 endpoints/protocol design for ARCT-2601, CF, or PKU programs.
• Operational: Enrollment timelines for CF Cohort 4 dependent on site activation in Israel and Turkey; risk that top-line data may not be sufficient to trigger immediate go/no-go decision if additional data is required.
• Commercial: Execution of commercial activities in EU/UK in 2027 requires successful navigation of market entry without established local infrastructure; US vaccine commercialization dependent on partner selection.
• Safety: Potential safety signals in upcoming cohorts that could halt enrollment or trigger study discontinuation (though currently no SAEs observed).

Management Tone on the Future:

• Confidence: High confidence in the efficacy of Lunar 2.0 (38-fold improvement) and the sufficiency of the 12-week CF data window.
• Focus: Emphasis on "disciplined execution," "highest priority programs," and "long-term value" over diversification into unrelated areas like personalized oncology vaccines as a primary business model.
• Clarity: Management expressed increased clarity on regulatory pathways following Type C meetings, reducing uncertainty compared to prior periods.
• Hedges: Standard safe harbor disclaimers regarding forward-looking statements; acknowledgment that Phase 3 start in late 2027 for CF is "speculative" at this point pending positive data.

Miscellaneous:

• R&D Efficiency: R&D expenses decreased YoY ($56M vs $87.7M in 9 months) due to reduced clinical/manufacturing activity on lunar COVID/BARDA programs and lower headcount costs, offset by strategic acquisition costs.
• Revenue: Q3 2026 revenue ($18.3M) includes $12M termination payment from CSL Securus; revenue normalization expected post-2026.
• Data Presentation: Q2 2027 CF data presentation likely to occur at a conference; will be a "fulsome data set" of all Cohort 4 subjects.
• Internal Control: Open-label CF data access restricted to medical personnel (including CMO) for safety monitoring only to avoid efficacy bias during enrollment.