Moving forwards, usual disclaimer that goes with all of these presentations: we will be talking about future-looking events within this presentation and in the discussion. Please be aware of the disclaimer that goes with it. A quick overview of where we are. You know about the company as being a clinical-stage small molecule drug company, with deep expertise in kinase inhibitors, most notably, of course, in the TYK2/CHK1 field, where we will spend most of the time today. Happily, we're now back involved in the CHK1 side, having regained control of SRA737 shortly after the period we're discussing ended. We are well funded now. We closed in the period with cash of GBP 4.1 million, with a further GBP 1.07 million raised in early March. The pipeline now looks like this.
This, of course, is different from recent years in that Check One is included within our pipeline for the first time in my living memory. Please, Tim. Highlights from the period, most notably, of course, we completed and announced the completion of the phase I study for SDC-1801. John will discuss that, of course, in a little more detail. We've been able, because of the funds that raised during this last year, to start looking more actively at 1802 again. Of course, with the return of 737, we now have a cancer drug which has already been in the clinic for phase I to studies, both as a single agent and in combination. During the period when it was last sublicensed, an IND was opened in the U.S.
There is now, for the first time, the ability to conduct trials in the States. The financials I've just summarized, although it's worth noting that in addition to the post-period end placing, we also had an R&D tax credit. The total income during this first quarter has been GBP 1.3 million, approximately, into the company. Moving on from there, and we'll start looking at the proprietary program. And again, please, Tim. Very briefly, in summary, the data, the phase I data have demonstrated that we do have a highly selective molecule in 1801, which is a differentiator against our competitors. One thing which leads us to believe that we do indeed have potential for a best-in-class molecule. We can see that there is potential for this in many autoimmune disorders.
We've spoken previously about psoriasis, but that's one of several molecules in the autoimmune conditions in the autoimmune field, where we believe that 1801 could well be applicable. The positive results from phase I has led us to believe that we have a very strong story, and we are undertaking this extended top study to provide, hopefully, a licensee with a ready for phase II compound. With that, I'm gonna pass over to John, who will go into more detail through the program.
Thank you, Stephen. Yeah, so SDC-1801 is a, as you know, clinical stage dual TYK2 JAK1 inhibitor. The phase I trial dosing of the volunteers in Australia completed in June 2024. We received the unblinded data in Q3 of 2024, and the results were very positive. High blood exposure was achieved, and there were no serious adverse events due to SDC-1801. In fact, the adverse event profile was very similar between treated and placebo groups. All adverse events that were noted were mild or moderate. There were no clinically significant effects on blood components or serum creatinine, and I'll come later to why we see that as being very significant. We also saw a significant dose-dependent reduction in biomarkers of TYK2 and JAK1.
In our preclinical models, we had demonstrated the mechanistic proof of concept, seen dose-dependent efficacy in models of psoriasis and rheumatoid arthritis. We demonstrated that SDC-1801 potently blocks TYK2 and JAK1 signaling in human whole blood assays with no measurable inhibition of JAK2. The good safety pharmacology and toxicology that we observed in the preclinical studies translated into the clinic, and we found that the human pharmacokinetics were suitable for once daily oral dosing. We really were very positive from the results that arose from that phase I trial. This is a cartoon just to show you why we think dual TYK2 JAK1 inhibition is optimal for the suppression of a number of cytokines linked to several autoimmune diseases. If you look at the cartoon, it is really demonstrating the cytokine receptors.
When a molecule binds to the cytokine receptor, to the interferon receptor, for example, interferon gamma binds to the interferon gamma receptor, it uses JAK1 and JAK2 to transmit the signal downstream. Now, blocking some of these JAKs is beneficial because it blocks cytokines that are associated with autoimmune and inflammatory diseases. Blocking certain JAKs, such as JAK2, you'll see on the left of this molecule, has negative effects because JAK2 is very much involved in erythropoietin and thrombopoietin signaling, and inhibiting JAK2 can lead to a number of hematology toxic side effects. We very much want to avoid JAK2. We see that in contrast to the selective TYK2 inhibitors, so TYK2 and TAK-279, by also inhibiting JAK1, another range of cytokines are inhibited, which could have positive effects in diseases.
Just to demonstrate that, we've got some data here from clinical studies using a dual TYK2 JAK1 inhibitor, Brepocitinib, versus single TYK2 or dual JAK1 JAK2 inhibition in clinical studies. Slight caveat, you know, it's always somewhat, well, not dangerous, but you just need to be aware when you're comparing between clinical studies that these are different groups of patients, different protocols are used in the clinic, for example. I think this data does show quite nicely that Brepocitinib gave the best readout in a psoriasis trial. We're looking at PASI 75, that psoriasis area and severity index. We're looking at reductions in psoriasis symptoms in patients, and the dual TYK2 JAK1 inhibitor appears to be more effective than the selective TYK2 inhibitors or the dual JAK1 JAK2 inhibitor, Baricitinib.
Looking at the human pharmacokinetic profile of 1801, we saw a half-life of around 17-20 hours, that confirms the suitability of a molecule for once daily oral dosing. In MAD cohort D, this is the highest dose group in the MAD experiment, we saw that plasma exposure of 1801 was equivalent to Brepocitinib at 100 mEqs. I'll come on to why that might be important later on. Just going back to our data, the exposure of 1801 exceeded the human whole blood interferon alpha and IL-12 IC50s throughout the entire dosing period. That means that we are achieving a concentration of drug in the blood that reduces interferon alpha and IL-12 signaling by at least 50% for the entire dosing period. We didn't see any changes in hematology or serum creatinine after 10 days of dosing.
Now, in contrast, Brepocitinib, that's the molecule I just described on the previous slide, giving the best results in the psoriasis trial. Brepocitinib at 100 mEqs caused increased serum creatinine and reductions in reticulocytes and neutrophils. Reticulocytes are immature red blood cells, and neutrophils are an important part of a white blood cell system. You don't really want to be reducing those, those components of the blood cells. The data I showed you on the previous slide with Breplocitinib, that was using Brepo at 30 milligrams. Going higher leads to these side effects, and I think that's why Breplocitinib is limited to typical use at 30-45 milligrams in the clinic. Switching back to 1801, we've got a very strong set of biomarker data. IP-10, interferon gamma-induced protein 10, which is a marker of JAK1 and interferon gamma signaling.
We've seen dose-dependent reductions in IP-10 levels in the MAD cohorts. CRP, C-reactive protein, a general marker of inflammation, and again, downstream of JAK1, and in this case, IL-6 signaling, we saw dose-dependent reductions in CRP levels in the MAD cohorts. In an ex vivo challenge, this is where we're sampling blood from the volunteers in the clinical trial. We're taking that blood and treating it with interferon alpha, challenging it with interferon alpha. Bear in mind that these subjects have taken our molecule. We saw dose-dependent reductions of phospho-STAT3 and phospho-STAT5 cells. When interferon alpha binds to its receptor, it uses TYK2 and JAK1 to phosphorylate STAT3 and STAT5. That's what the P on phospho-STAT3, phospho-STAT5 means.
This is direct evidence that we have target engagement with our molecule on the targets that we wanted to hit. We observed that effect in two different cell types of the immune system, T cells and monocytes. Our differentiation versus Breclocitinib, and this leads onto our theories around best-in-class potential for this molecule. Breclocitinib is the most advanced dual TYK2 JAK1 inhibitor in the clinic. It's currently undergoing phase III trials. As I mentioned earlier, it's typically used in the clinic at 30-45 mg, once daily, QD, once daily. Going above 30 mg in the phase I trial, they observed increased serum creatinine levels, and that was due to the inhibition of OCT2, it's a renal transporter, kidney transporter. Breclocitinib inhibits OCT2.
1801 has much greater selectivity versus OCT2, so we do not see any effects on serum creatinine levels when we dose with 1801, giving exposures equivalent to 100 mEqs of Breclocitinib. Greater than threefold the clinical dose of Breclocitinib, we are not seeing this effect. Likewise, at greater than 30 milligrams of Breclocitinib, reductions in neutrophils, those white blood cells, and reticulocytes, the immature red blood cells, are observed with Breclocitinib. We saw no effect on neutrophils or reticulocytes at doses equivalent to 100 milligrams of Breclocitinib. Our molecule has a greater half-life in humans, approximately 17-20 hours versus Breclocitinib, six to eight hours. We saw an ideal PK profile for JAK inhibition. Average concentration is important for JAK inhibitors rather than the maximum and the minimum concentrations. These are the peak to trough ratios. We see excellent sustained average concentrations with 1801.
It's driven by the long half-life, and we see that as a distinct advantage. As Stephen's mentioned, what we're doing at the moment is preparing the molecule for phase two studies, and this has necessitated a resynthesis of the drug substance. This has had some knock-on effects on our toxicology studies, which I'll explain in a little moment. We're also working on optimizing the formulation. We used capsules in the phase one study. This is advantageous relative to many phase one studies which use solutions of the molecule to dose their subjects. We were using capsules straight away in the phase one, but there's some work needed to be done to improve those formulation, to improve the absorption of the molecule, and also to prepare capsule sizes consistent with the expected phase two doses.
Our 16-week toxicology studies are scheduled to commence in May 2025, and we'd expect them to complete in the fourth quarter of this year. This is a delay relative to what we told you at the IMC meeting in December, and this has really been driven by a need to resynthesize the drug. A couple of reasons for that. We were planning to use the GMP material that we had left over from the phase I trial. When we did a risk assessment, we saw that potentially that's a very clean batch of drug, and we could run into difficulties if any subsequent batches of drug have a, let's say, a dirtier side effect profile. If they had impurities in subsequent batches that were not present in our tox batch, that would mean that our toxicology studies were of no use. They would be defunct.
We made the decision to prepare a fresh batch of material to take forward into these tox studies. Batches of drug used in tox studies tend to be dirtier than those that you're gonna take forward into the human trials. We've also decided that we're gonna increase the doses used in the tox studies because we're not seeing particularly large effects in the tox studies. Sometimes the regulators really wanna see some, you know, maximum toxicity. We're gonna increase the levels of exposure that we get in the toxicology studies. If I move on to the next slide. That concludes 1801. I'll just talk briefly on 1802. As Stephen said, we have begun to ramp up the translational and the preclinical studies around 1802 using the funds from a recent share subscriptions.
The development of 1801 has given us some experience that will certainly feed through to, aid the development of 1802. And we've got a strong patent position around 1802, covering not only cancer but also, some immune disorders as well. So, we're confident about 1802. We're gonna push forward, very strongly now with, accelerated studies. I'm gonna talk now about CHK1 and SRA737, a selective CHK1 kinase inhibitor suitable for once daily oral administration, which has completed a couple of phase I to II trials already. Just to say, with the given change in control, we now control the program and have an increased slice of the economic benefits up to 63.5%. It has gone up to 63.5%. The molecule was originally developed by ourselves in collaboration with several Cancer Research UK-funded organizations, successfully completed two phase I II trials, with the original license partner, Sierra Oncology.
It was subsequently licensed to a private U.S. biopharma company, and the license was returned to CPF, a Cancer Pioneer Fund, in Q1 of 2025. We've now negotiated with CPF to take over the program, pushed our economic interest up to 63.5% from 27.5%, and we're currently reviewing the licensing and development options to take the program forward. There is some very compelling clinical development path supported by preclinical models with synergistic anti-tumor activity and a strong mechanistic rationale. What I'm showing you here is a model in mice. It's called a syngeneic model. These are mice with a functional immune system, and they have a small cell lung cancer. That's the SCLC, a mouse small cell lung cancer.
What we're demonstrating here is that combining an anti-PDL1, this is the immunotherapy that has revolutionized cancer treatment over the last 10 years or so, combining anti-PDL1 antibodies with SRA737 and low-dose gemcitabine has a pronounced effect on the volume of the tumors. In fact, 80% of the mice in this study had sustained complete responses. The tumors had entirely disappeared. You'll see if you, I won't go through it all, but the lines above the triple combination basically show you the effects of 737 by itself, low-dose gem by itself, the antibody by itself, and then various combinations. You can see it's only when you bring the three things together that you get these really profound reductions in tumor volumes. Also, we saw the effects on the innate immune signaling. Things like STING and interferon are drastically altered by this triple combination.
Also, important to say, we saw similar effects in a colorectal cancer model. Moving on to a model in combination with PARP inhibitor. PARP inhibitors have also found a large market in particularly treatment of ovarian cancer, starting to show some effects in prostate cancer as well. PARP inhibitor resistance is an emerging unmet clinical need, and we have some data that we're showing here that shows that combination of 737 with a PARP inhibitor is well tolerated, but also has pronounced anti-tumor activity in a model of high-grade serous ovarian cancer in this case, which has developed resistance to a PARP inhibitor by itself. You can see combination of 737 with a PARP inhibitor led to four out of nine complete responses in this mouse model.
Big clinical opportunity there, potential for phase one B2A clinical trial of 737 with a PARP inhibitor in PARP inhibitor resistant or refractory patients. Just to summarize 737, it's a clinical stage development candidate, has a defined CHK1 inhibitor mechanism, and a clear development plan. Demonstrates promising clinical activity. It's well tolerated as a single agent and in combination with chemotherapy. There's strong clinical validation for its mechanism, its ATR CHK1 axis. SRA737's competitively positioned within this DDR class. It's a very good molecule. It's got excellent drug-like properties, low drug-drug interaction potential. We think it's very, eminently suited for combination with other clinical agents. The data supports potentially rapid clinical development paths in anogenital cancers and additional clinical potential when combined with, for example, PD-L1 or anti-PD1 antibodies. PARP inhibition, I showed you some data supporting that.
Also, Wee1 inhibition, there's some data that we put out on X recently or on LinkedIn that shows some potential for combining with Wee1 inhibitors. Lots of potential opportunities for taking this molecule forward in the future. I'm gonna hand over there to Tim to take you through the unaudited financial results for the period.
Thank you, John. Good morning, everybody. It's Tim Mitchell here. I'll just take you through the results, which you may have seen were announced today. These are the six months results to the period ending 31st of December 2024. Comparing with the same period last year, actually, I'll first note that the results for the six months to December 2023 have been restated. This was because there was a finance charge on the income statement for the 2023 figures, which has since been settled by shares.
That charge has gone away. That's essentially a contingency charge, and that's gone. That's the reason for restating the results. You'll see that the operating expenses for the period to December 2024 are considerably lower than they were for the corresponding period to 2023. This is mainly because of the reduced clinical trial costs. There have been some trial costs that carried on into the end of last year. The follow-up of the biomarker studies, for instance, was concluded during the last part of the year. It all feeds through. The tax credit is less because we've had less clinical costs.
It ended up in a, in results, in, in a loss after tax of, of just over GBP 1 million, compared to, one and three quarter million for the, corresponding period last year. If we look at the, the balance sheet, the, the investment in associate is, is essentially the cash left in the, the, the SRA737 CHK1 partnership, with the, CRT Pioneer Fund. That, that, that money, less some expenses, partly due to the handover, will, will come back to us at some stage. I think the, the, the big difference compared to last year is our cash position. As a result of the share subscriptions we, we, we undertook during last year and of course topped up by a further GBP 1 million or so, from this year, plus a little bit of a tax credit.
The cash position as of the end of December is just over GBP 4 million. We are well financed for our current activities going forward. I think we are there. I will hand back to Stephen to talk about what is coming up for this year.
Yes, thank you, Tim. Thank you, John. During the year, let's just break it down into the three main programs. For 1801, of course, there is the submission of the academic paper to a peer review journal. That is in progress, but that will hopefully come shortly. What happens after that, of course, just to remind you, is entirely out of our hands in that the peer review process can move quickly or it can take some time.
Those of us who publish papers in our time will know the full range of timelines on that. Then of course we have the completion of synthesis and formulation for the new drug product that John has been talking about and launching the long-term tox trials, which as we've said, we would expect to have completed in Q4 in this year. On 1802, we're commencing the manufacturing of drug product for formal preclinical trials. That is again, as John has said, we were expecting to benefit from the process development learnings from 1801 in that, and from that look to initiate preclinical studies and in parallel, look at target cancers for the clinical testing. Because of course, for the cancer drug, the norm is to go into phase I/II studies in patients straight away.
Lastly, 737, great pleasure to talk about that again. Complete the receipt of data, which hasn't quite happened yet. We're expecting that, that process is flowing well at the moment. Review the future options on the basis of the material sent back to us, and KOL advice and indeed contacts with third parties who may have an interest in licensing the drug from us. That concludes the presentation and the summary of the results. I'm very happy to take questions and we'll do that. Many of you have been kind enough to pre-submit questions. I will read them out and then, as appropriate, either answer or pass to John and Tim for them to answer. I know that some of you have been submitting questions during the slides deck.
I do hope that we will get to those as well. As the hosts of the call said, we will go through all questions submitted and provide a list of written answers at some point in the near future. First of all, question about 737, in taking over the license, was it by mutual agreement or did they approach Sareum? Broadly speaking, this was, as you can imagine, stimulated by the return of the license from the private U.S . company, which happened at the end of December last year. CPF is a fund which is looking to wind down at the moment, and they were very happy for us to step in and also for us to renegotiate the economics.
I know that several of you have asked the related question, which is, what did we have to pay for this? The answer is nothing apart from, of course, the legal costs that always go with these things. This was a deal which was entirely mutually agreed by all parties. Moving on, perhaps John, you could talk a bit in more detail about the paper for 1801, moving that forwards.
Yes. The paper 1801 is in progress. I think we had to be very, very careful that we've got our patent position fully sorted out before we submit that data. Because once that's published, we have put the prior art out in the public domain and it would prevent us from patenting anything related to that data.
I think we're confident we've got our patent position in good shape and hope to submit that paper for peer review shortly.
Thank you. There have been several questions here about PR and our market-facing activities. Just to say that I do intend that we should ramp up PR activities during the year. In fact, I am booked to give a presentation at one of the investor meetings in June. I also intend that, according to whichever is the specific topic, one of us will on a more regular basis interact with the likes of Edison or indeed IMC in recording interviews and making sure that everybody is aware of progress. We are looking in this year to be more active on the PR side.
have also been questions about the appointment of Oberon as a new joint broker. The reason for doing that is that I am very conscious that it is very important that we have a broker who is active in the secondary trading position, as well as providing a good service for primary issuance. I felt it was important that we were balanced between Hybridan and we introduced Oberon into the mix, who do have a secondary trading position. I am sure that we will see the benefit of that going forwards. Other questions that have come in just recently, there are various questions again about the use of advisors for doing deals. We do, of course, have a roster of advisors who are contracted to us, most notably our Nomad.
For specific deals, we will, we're certainly not shy to engage with financial advisors, with specialist knowledge or specialist ability in addition to help us to get deals over the line. We didn't, if you may like to know, we didn't involve external advisors for the 737 transaction. We may well do if a need arises for 1801 licensing or anything further than that. There's a question about the work done by the private U.S. company in the last year. We are not able to talk about that. We are under very clear confidentiality restrictions. Suffice it to say that anything that they have achieved now forms part of our data pack that we can then exploit going forwards. Yeah, please. I'll just add one thing, actually.
The one thing we can say from the private U.S. company, they filed the IND, which we mentioned earlier before. Actually, there was a question, and sorry, apologies for not explaining that. An IND is an investigational new drug. This is the clearance by the regulatory authorities to undertake a clinical trial. That work was done by the private U.S. company last year.
Thanks, Tim. One or two questions around the delay in the launch of the top study. I do not think we need to go into great detail about this. Of course, John has explained that very well, I would say. Somebody is asking effectively, why did not we build up enough material to start already? The simple fact is that when you are synthesizing drug, this is done on a batch process.
You have nothing or you have everything. It doesn't come, it's not drip fed.
I think the other thing just to say to that is, you know, it's always a balance of risk, isn't it really? You know, we could have, we could have prepared 10 kilograms of material last year and kept 8 kilograms in stock for any subsequent studies. Of course that costs a lot of money and we could have had a negative result from a clinical trial, which would have rendered all that material useless. We're always trying to sort of balance the risk of what we do with the timelines versus the expense of doing certain things.
Yes, thank you. I'm going back to perhaps some of the pre-submitted questions. There's a question here.
It says, considering the consideration being given to a dual listing on NASDAQ, I think the answer to that is, nothing is ever ruled out. I'm also very conscious that the grass is actually not as, not greener on the other side of the fence. There have been several stories in recent months of U.S. companies, which on paper should have been very successful, failing dismally. I think we will always be aware of it. We'll always look, but we'll also be cautious before we leap into the NASDAQ direction. Now I'll have, just looking down the list, let's see. Sorry, Tim, can you read that one?
Yes. There's a question just come in on 1801.
Is there a possibility that we take on the phase II if our shareholders are supportive? Are we already in discussions with potential partners for SDC-1801? The answer to that is yes for both. We're pursuing essentially a dual path here. We're getting the compound ready for a subsequent phase II trial, and then we'll take a view nearer the time as to what's the best deal for us and our shareholders, as in whether to press ahead into a phase II trial if there's support from shareholders to fund that. Or is there a good offer from a potential partner for a licensing deal for SDC-1801?
Yeah, the current strategy we're taking of taking essentially most of this year to get the compound phase two ready allows us to assess options for both licensing and raising money for a phase two. I think if there's a good license deal out there, I think that would be our priority.
Absolutely. Yes, absolutely.
There was another question about which country we're looking to test 1801 in, Australia or England, and why. If we were to do a phase two trial with 1801, and I think if anyone were to do a trial with 1801, it's likely it would be done in multiple territories. You start to need to look in a much larger group of patients. Phase two A, probably each group would have something like 48 patients in it.
You might want to test a couple of doses and placebo. You are looking at, you know, 100 and 120, 130 patients. You are likely to need to go to multiple territories to do that. I certainly would have no issue whatsoever with conducting a trial in Australia again. I wish I could say the same about the U.K. I mean, we did have a very negative experience of MHRA. I think they are getting their act together to some extent, but whether we would want to test that again, I do not know, but likely multiple territories.
Indeed, indeed. Let us, I think we are. Oh yes, there is a question here. Thank you. The question here is whether we are likely to take 737 into a clinical trial in the near future. I, again, as John just said, I think that is not our current intention.
If the opportunity were to arise and we have been approached by medics as well as by companies, then there may be an argument for it. If that were to be the case, we would certainly be informing you of that at an early stage, because whilst we are currently funded for all the programs that we are currently planning, 737 was an opportunistic acquisition, and therefore a clinical trial with 737 would fall outside of that. We would need to come back to shareholders to raise funds to do that. You will know where that's changed, but that's not the current plan.
I've got a related question here about actually, oh, conversations, and this is going back to our dual strategy of exploring funding options for further trials versus license agreements. Have you already had conversations with other pharma about on licensing SRA737? How quickly could this happen? The answer is yes. While the 737 program was essentially under option to a U.S. biopharma company last year, we did have a number of inquiries about the program coming in, which we had to essentially put on hold because the first refusal was with this U.S. biopharma. As soon as we got the notice from this company that the program was going to come back to us, I've been following up on all those previous inquiries.
We can't really say about the progress of those until something's happened. You know, there are a number of inquiries which we are following up. Of course, now in the partnering meetings, such as the Bio Europe Spring meeting that I was at last week, we've got that 737 is very much in our shop window. We are looking to attract new license partners as well as the ones that we've already been talking to.
Yes, thank you. I think that's probably, we've rather answered in groups from specific questions, but as you can imagine, there have been several questions per topic. I think we have probably covered most things here.
Stephen, if I may just jump in there and thank you for addressing all those questions from investors today.
Of course, as the company has mentioned, we will review all questions submitted today and we'll publish those responses on the Investor Meet Company platform where appropriate. Stephen, before we redirect investors to provide you with their feedback, which I know is particularly important to the company, if I may just ask you for a few closing comments?
Yes, of course. Thank you for that. In closing, I do want to thank you for sticking with us. I'm very, very aware that we're all aware as shareholders, quite apart from us officers, that this has not been a happy time with regard to the share price. We are looking to improve shareholder value, of course, for everybody's benefit. We are looking at all options in front of us to do that.
I do hope that we will be able to have a happier story when we next meet in an IMC. In the meantime, we do appreciate your feedback, and I'll be very happy to answer questions directly or generally from shareholders. Thank you all.
Stephen, Tim, and John, thank you once again for updating investors today. Could I please ask investors not to close this session as you will now be automatically redirected to provide your feedback in order that the board 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 Sareum Holdings, we would like to thank you for attending today's presentation and good afternoon.