Good day, ladies and gentlemen, and welcome to Vivoryon Therapeutics Half Year Results for 2022. For information, today's conference is being recorded. At this time, I turn the call over to your host today, Ms. Manuela Bader. Please go ahead, ma'am.
Thank you, George. Good afternoon, and thank you for joining us today for Vivoryon's conference call to discuss the company's H1 2022 results and operational progress today, including details on the private placement we announced earlier this morning. This morning, Vivoryon issued a press release reporting its H1 2022 results, which is posted on the company's website at www.vivoryon.com. On the call with me today are Ulrich Dauer, our Chief Executive Officer of Vivoryon, and Florian Schmid, our Chief Financial Officer. Also with us on today's call and available for questions is Michael Schaeffer, our Chief Business Officer. We will begin today's call with opening remarks from Uli on Vivoryon's approach to overcoming the challenges of AD drug development, our strategic focus and progress, and then Florian will review the financial results for the H1 of 2022. Following the prepared remarks, we will hold a Q&A session.
Before we start, I would like to remind you that during this conference call, we will present and discuss certain forward-looking statements concerning the development of Vivoryon Therapeutics' core technologies, the progress of its current research and development programs, and the initiation of additional programs. Should actual results differ from the company's assumptions, our actions may differ from those anticipated. You are therefore cautioned not to place undue reliance on such forward-looking statements, which speak only of the day hereof. With this, I will now turn the call over to Ulrich Dauer.
Thank you. To contextualize the key updates for the H1 of 2022, I'd like to start off by highlighting Vivoryon's approach and how it is differentiated from all others in the field. More than 50 million people worldwide are living with Alzheimer's disease and dementia, currently without a chance of being cured. The devastating reality, this disease affects not only the patients themselves, but also places a heavy burden on all families, caregivers, and physicians. Last year, Aducanumab was approved in the U.S. as the first potentially disease-modifying treatment for Alzheimer's disease. While aducanumab is currently not broadly available to patients outside of the clinical study setting, this approval, after nearly 20 years of disappointment in the space, was an important signal to the community and the markets.
Nevertheless, the uncertainties remaining around the potential regulatory path to approval for other Abeta antibody-based approaches have considerably dampened the overall enthusiasm. Unfortunately, an extremely high unmet medical need remains for safe, effective, and widely available treatment options. The last couple of days have seen a surge of excitement in the AD community based on the positive data published by Eisai and Biogen for lecanemab, an investigational anti-amyloid beta protofibril antibody. According to Tuesday's press release, I'm sorry, the phase III confirmatory Clarity AD study met primary and secondary endpoints, and the incidence profile of amyloid-related imaging abnormalities, or ARIA, an adverse event associated with anti-amyloid antibodies, was reported to be within the developer's expectations.
These results are obviously very encouraging for all those affected by Alzheimer's disease and for the community as a whole, as they will help the field to better understand the relevant factors in Alzheimer's disease drug development and further enhance the overall knowledge base in Alzheimer's disease. I'll talk a bit about more why we at Vivoryon feel that these results are particularly interesting. First, I'd like to explain why, independent of the results from other programs in Alzheimer's disease, we believe that with varoglutamstat, we have a unique, differentiated approach to address Alzheimer's disease and therefore have a great chance to add a different therapeutic modality to the emerging therapeutic landscape. At Vivoryon, we are fully committed to making a real difference to all of the people affected by this merciless disease.
Our approach to treating Alzheimer's disease is very different from antibody-based approaches and from those that focus solely on the amyloid aspect of the disease. I'd like to briefly share with you why this is the case and why we believe that this will allow us to become an important part of the solution to end the Alzheimer's crisis. We specialize in developing medicines to block the misguided activity of certain enzymes that either cause diseases or allow them to progress. Our most advanced medicine in development, varoglutamstat, is a small molecule designed to overcome the challenges of Alzheimer's disease drug development.
Varoglutamstat is in clinical phase IIb development, and it has a unique dual mode of action that is truly differentiated from the other approaches in clinical development, which is shown in the graphic on the right-hand side. Firstly, as you can see in pink on the left, varoglutamstat blocks the enzyme glutaminyl cyclase or QPCT for short, and this prevents formation of neurotoxic N3pE amyloid, a toxic Abeta variant shown to play a pivotal role in the development and progression of Alzheimer's disease. Importantly, this happens way upstream of other approaches, which means that varoglutamstat can also have an impact on other downstream pathologies such as tau pathology, neural inflammation, and synaptic impairment. There's a second important pathway on which varoglutamstat acts, which is shown here on the right side in dark purple.
Here the isoform or variation of glutaminyl cyclase called QPCTL upregulates or boosts the pro-inflammatory signaling molecule CCL2 by turning it into pE-CCL2. By blocking QPCTL, we are able to reduce neural inflammation. Moreover, CCL2 is also a promoter of the tau pathology, meaning that we can also address this pathology via both elements of varoglutamstat mode of action. Varoglutamstat is modulating all important pathological hallmarks of Alzheimer's disease, Abeta pathology, neural inflammation, tau pathology, and therefore can protect synaptic function. Now, coming back to lecanemab. According to its developers, the antibody is designed to bind to soluble Abeta aggregates rather than only larger insoluble aggregates or plaques, and can therefore be considered a bit further upstream than, for example, aducanumab.
What I want to stress here is that varoglutamstat is the first small molecule, and to our knowledge, the only project in clinical development selectively targeting the de novo production of neurotoxic N3pE amyloid. We have the opportunity at our hands to attack Alzheimer's disease pathology even further upstream than lecanemab. There's another huge benefit of varoglutamstat being a small molecule. With antibody-based therapies in Alzheimer's disease, safety of the patients is one of the main concerns. We've already characterized varoglutamstat broadly, and I'll show you in a moment what we've seen there in terms of safety and tolerability. Another key advantage of our approach is that while many drugs in development in Alzheimer's disease are antibodies that have to be injected or infused, we focus on small molecule medicines, so varoglutamstat can be very conveniently administered as an oral pill.
We've carefully designed our development program with a clear regulatory path in mind towards bringing it to patients in need as soon as possible. Our development strategy is rooted in promising phase 1 and phase 2a results, where varoglutamstat was well tolerated and showed statistically significant changes from baseline in working memory-related parameters after only three months of treatment in patients suffering from Alzheimer's disease. Before we dive deeper in our clinical development highlights and how these fit into our overall development strategy, I'd like to start with a number of important corporate developments. Building on the progress we made throughout 2021 and 2022 year to date, and despite the overall market conditions our industry has been facing over the last year, we were able to successfully complete two substantial financing rounds.
In April 2022, we were able to successfully raise EUR 21 million in a private placement, supported by a number of high-quality institutional investors from Europe and the U.S., as well as ex-executives and non-executive members of our own board. As announced earlier today by means of a press release, we have entered into another private placement of EUR 15 million, supported by our long-standing investor, Claus Christiansen, and our new investor, KKR Dawn Aggregator, a platform controlled by affiliates of KKR, a leading global investment firm. The investment agreement includes an additional option for the investors to place up to another EUR 15 million during a period ending 12 months after the date of the approval of an EU Recovery Prospectus, or three months after the achievement date of a defined clinical milestone, whichever is later.
Having secured these significant private placements will enable us to continue to follow our carefully crafted development strategy. We warmly welcome our new investor, Dawn Biopharma, and are very grateful to them and to our long-standing investor, Claus Christiansen, as well as those shareholders participating in our April financing round for their support through the upcoming clinical milestones. On the leadership side, I'd like to highlight that we've expanded and diversified our team with the appointments of Dr. Claudia Riedl and Samir Shah, MD, as non-executive directors of our board. In addition to our own efforts, the regulatory achievements of our Chinese partner, Simcere, enabling near-term clinical development in China, broaden the tremendous opportunity for us to make varoglutamstat available to as many patients in need as possible. Moving on to our clinical portfolio highlights.
2022 year to date was marked by decisive progress in the development of varoglutamstat in Alzheimer's disease, which culminated in several data presentations at the prestigious AAIC conference in San Diego in July and August. There are a number of highlights I'd like to share with you today. Firstly, we have been able to further de-risk clinical development of varoglutamstat with extremely encouraging safety results from our VIVIAD phase IIb study, where we completed the parallel group dose finding part and the independent data safety monitoring board selected the highest dose investigated, 600 milligrams twice daily, as final dose in the second part of the study.
At the same time, further substantiating the rationale for evaluating varoglutamstat in combination with monoclonal antibodies to treat Alzheimer's disease, also at AAIC 2022, we presented preclinical data underscoring the unique mode of action or the unique potential of our N3pE amyloid targeting therapeutic strategy in both mono and combination therapy settings in Alzheimer's disease. The data show that a combination treatment of aducanumab and varoglutamstat achieves additive effect on Abeta pathology, indicating feasibility of dose reduction to improve safety of Abeta antibody-based Alzheimer's disease treatments. This demonstrates the potential benefit of a combination therapy designed to simultaneously make use of two different and independent molecular N3pE related mode of actions, namely small molecule-based reduction of N3pE amyloid by QPCT and QPCTL inhibition and clearing existing Abeta deposits through anti-N3pE Abeta immunotherapy.
Together with our collaboration partners, we published data at AAIC 2022 from a murine analog of PBD-C06, highlighting the differentiated safety profile versus other anti-Abeta antibodies at N3pE amyloid-lowering concentrations. Together with previously published data showing that varoglutamstat in combination with our own N3pE amyloid-specific antibody, PBD-C06, has an additive effect on reducing brain Abeta pathology in transgenic mice. The data set presented at AAIC 2022 adds to the overall preclinical data package, enabling us to explore the full potential for varoglutamstat application in a variety of therapeutic settings. While we're currently focusing on developing varoglutamstat as a monotherapy, we see great potential in further investigating this approach in the future. Our second ongoing clinical study, VIVA-MIND in the U.S., the phase IIa plus b study of varoglutamstat, is actively enrolling patients.
There are currently 14 sites open and the study is on track for interim futility analysis planned for the H1 of 2023. I'll give you a bit more detail on our ongoing phase II studies now. What's important to understand here is that through a carefully crafted study design, we were able to achieve improved tolerability for varoglutamstat compared to the prior phase IIa study, our SAPPHIRE study. SAPPHIRE reported encouraging first evidence of the disease-modifying activity of varoglutamstat, most importantly, with statistically significant changes from baseline in working memory as an important cognitive ability after only three months of treatment. While varoglutamstat was generally well-tolerated, a maximum tolerated dose was reached in the study at 800 milligrams twice daily.
We were extremely happy to report in VIVIAD that we were able to reduce the discontinuation rate from 33% in SAPPHIRE to 1.1% in VIVIAD. Now, from our extensive PK/PD data, we know that 600 milligrams twice daily results in high target engagement. We're talking about 87% here. We're able to achieve improved tolerability for varoglutamstat without significantly sacrificing target engagement. For VIVIAD, following the data safety monitoring board decision to move forward with 600 milligrams twice daily for the second part of the study, we are well on track with 22 active sites in five countries, gearing up to final readout in the H2 of 2023. I am truly grateful to everyone involved in the study for their outstanding efforts to meet the challenges all clinical studies around the world have faced over the past two years.
The same goes for VIVA-MIND, the U.S. study we initiated in September last year, which is run by the ADCS and supported by an NIH grant. Despite the pandemic and also weather-related challenges in the U.S. during the winter, the study is open with 14 active sites and randomizing and treating patients in the ongoing phase IIa part of the study. VIVA-MIND is on track for interim futility analysis in the H1 of 2023. If predefined criteria are fulfilled in this analysis, the trial will pass a stage gate into the phase IIb part. Before we move to the financials, I would like to point out where these great results and upcoming milestones fit into overall, in our overall development. I won't go into detail at this stage other than stating that we are following the diligently designed development strategy without cutting corners.
We've completed preclinical work showing the effect of QPCT blocking on cognition in well-known Alzheimer's disease mouse models. In a completed phase I clinical study, we've shown that varoglutamstat is well-tolerated, and we also got important information on dose response and target efficacy. As mentioned before, our first trial for patients with Alzheimer's disease, the phase IIa SAPPHIRE study, met not only the primary objective of obtaining important safety information. We were also able to show first evidence of the disease-modifying activity of varoglutamstat, most importantly, with statistically significant changes from baseline and working memory as an important cognitive ability after only three months of treatment. These phase IIa results guided the design of our ongoing European phase IIb study, VIVIAD.
Both our VIVA-MIND U.S. and VIVIAD EU studies are designed to align with the draft guideline, which, supported by the more frequent interactions we can benefit from due to our fast track designation, may provide further regulatory opportunities such as breakthrough designation and accelerated approval, provided all further relevant criteria in the context of our studies and the outcome are fulfilled. In summary, our overall data set is intended to support a clear path to approval for varoglutamstat. With that, I'd like to hand over to Florian to run you our financial results. Florian?
Thank you, Uli. In the first two quarters of 2022, our research and development expenses amounted to EUR 11.1 million, versus EUR 9.5 million in 2021. This increase was mainly driven by EUR 1.7 million higher expenses related to our clinical trial, VIVIAD, which has advanced significantly compared to the six months ended June 30th, 2021. When looking at the general and administrative expenses, we have reported a cost level that is similar to the six months ended in June 30th, 2021 of EUR 2.3 million. The reason for that is that higher expenses for share-based payments with EUR 0.3 million were fully compensated by EUR 0.3 million lower expenses for legal and consulting services. The company did not generate any licensing revenues in the six months ended June 30th.
As in previous periods, our finance result was predominantly driven by the FX results on US dollar cash or receivables, liabilities denominated in US dollars. The main receivables and liabilities denominated in US dollars result from the licensing deal with our partner, Simcere, that was executed in the H2 of 2021. For the first time, we have reported income tax expense consisting exclusively of deferred tax expenses. The reason for that is a very narrow definition in IAS 12 on how existing loss carry-forwards may be recognized. The result was a temporary excess of deferred tax liabilities. The increase in deferred tax liability excess in the six months ended June 30th, 2021 by EUR 89,000 was recognized as a tax expense in the same period.
All this together resulted in a net loss of EUR 12.6 million or EUR 0.60 per share for the first six months of 2022, compared to EUR 11.7 million or EUR 0.58 per share in the H1 of 2021. When we move to the next slide, I would like to highlight only some of the KPIs. The company has EUR 24.4 million in cash and cash equivalents as of June 30th, 2021, compared to EUR 14.7 million as of December 31st, 2021. If you look at equity or the number of shares, you can see that we issued 2 million registered shares at the beginning of April 2022.
On April 1st, 2022, the company completed a private placement by way of accelerated bookbuild at an offering price of EUR 10.5 per share. The new shares from the capital increase represented 10% of Vivoryon's existing share capital. The company's issued share capital, therefore, has increased to EUR 22,015,482. Our negative cash flows from operating activities were EUR 10.2 million for the six months ended June 30th, 2022, compared to EUR 6.1 million in the six months ended June 30th, 2021. The increase in negative cash flows by EUR 4.2 million was mainly due to EUR 4.7 million higher decrease of accounts payable in the six months ended June 30th, 2022, compared to the six months ended June 30th, 2021.
While the investing cash flows remained virtually unchanged, our cash flow from financing activities was EUR 19.6 million for the six months ended June 30th, 2022, compared to cash used in financing activities of half a million EUR in the six months ended June 30th, 2021. The change mainly relates to completion of the aforementioned private placement on April 1st, 2022. The gross proceeds of that offering were EUR 21 million, and the transaction cost amounted to EUR 1 million. The above described cash flows resulted in our cash and cash equivalents position of EUR 24.4 million at June 30th, 2021. With that overview, I would like to turn the call back to Uli for a brief concluding remark.
Thanks, everyone for joining us today. I'd like to conclude by emphasizing that all data generated by ourselves and published by others to date support our unique approach, which is to target N3pE amyloid, the molecule we believe to be the main driver of Alzheimer's disease. Thereby, we have the opportunity to address all pathological hallmarks of the disease, namely modulating Abeta pathology through preventing the formation of N3pE amyloid, attenuating neuroinflammation by destabilizing the pro-inflammatory signaling molecule CCL2, and modulating N3pE and CCL2-dependent tau pathology and synaptic impairment. In addition, I would like to reiterate that varoglutamstat is an orally available small molecule, not an antibody, coming with a high risk of ARIA. I would once again like to thank you, our shareholders, many of which have been following our progress for many years now, for their continued support, and welcome our new shareholders.
The data set generated during the reporting period and year to date have sparked excitement within the medical community and beyond, and further substantiate our commitment to making a difference to all those affected by Alzheimer's disease. We look forward to keeping you all updated on our progress, and will now open the call to take questions. Thank you. George.
Thank you very much, Mr. Dauer. Ladies and gentlemen, if you'd ask a question, please press star one on your telephone keypad. Please also ensure your mute function is not activated until you speak through your equipment. Once again, please press star one at this time. Today's first question is coming from Mr. Joseph Hedden, calling from Rx Securities. Please go ahead, sir. Your line is open.
Yeah. Good afternoon. Thanks for taking my questions. First of all, congratulations on a great fundraise. Really fantastic in this environment, as we know. Linked to that fundraise, for the second EUR 15 million, one of the conditions was linked to a clinical milestone, which, you know, the clinical milestone or the release of the prospectus, whichever comes first. Could you confirm what the clinical milestone is, by any chance?
Hi, Joseph. First of all, welcome to our call, and thanks for your congrats. Unfortunately, I can't go into a more granular level than you know, we stated in the press release at that time.
Okay. Appreciate that. Worth a shot.
No, this is [uncertain].
Secondly, I just wanted to ask a question about the patient characteristics of the VIVIAD and VIVA-MIND trials. Eisai has made quite a big deal about how they have, you know, recruited quite a balanced proportion of ethnic minorities into the trial, you know, this was an FDA criticism of the Aducanumab trial because they didn't do that very well. Is this something that you've kind of actively built into your recruitment policies as well, so that you don't run into similar issues later?
Hi, Joseph, that's Michael. Nice meeting you again by phone and, thanks for the congrats also from my side. Yes. The answer is clearly yes to that. Obviously we are and continuously working very close with ADCS and the requirements, especially in the U.S. are familiar to us. We have, let's say special programs to address minorities in the U.S. This is well reflected in our recruiting as well.
Okay, great. Perhaps lastly, could I just ask a conceptual question on the mechanism of action of varoglutamstat, specifically the pyroglutamate side? We know that targeting amyloid beta with antibodies is likely to be more effective when the patient is an APOE carrier. Is that the same when you are targeting with a drug like varoglutamstat is shutting off production or should it have equal efficacy regardless of APOE status?
Yeah, thank you for that question. The honest answer, Joseph, is we don't know because the population which we have in our SAFE trial, in the 120 patients trial, was just too small to really, you know, have kind of, you know, decent analysis on that basis. We just have no evidence for you know, any kind of conclusion yet. Enrollment with respect to APOE4 carriers is very balanced and we certainly will see once we have the final data of VIVIAD.
Okay. Thanks for that. Thanks, Uli. Thanks, Michael.
Thank you.
Thank you, sir. We'll now move to Alexander Galitsa, calling from H&A. Please go ahead.
Yeah. Thank you. A couple of questions, please. First of all.
Sir, could you please speak up a little bit? Your line is very low.
Sorry, can you hear me? Hello?
Could you just maybe increase your volume a bit, sir, please?
Yes.
Now that's better. Thank you, sir.
How about now? Okay, apologies. The first question is on the cash reach. Before this capital raise, the cash reach was, I think at least until May 2023, which I think already reflected larger part of necessary R&D outlays. Now, with this, incremental EUR 15 million, you say cash reach is until at least the end of 2023. I would expect the cash reach to be well into 2024. I was just wondering whether you could explain why you are being more conservative in your wording?
Well, I mean, being more on the safe side, I think is always the better choice. You're absolutely right. Including the proceeds from this private placement and according to current planning and estimates, we expect the existing cash and cash equivalents to be sufficient to at least finance our activities through December 2023. This does not include any exercise of the options to acquire additional shares, which was part of the recent transactions, nor does it reflect our options base to evaluate and pursue additional financing measures.
Okay, understood. The question on KKR joining as a shareholder. Given that it's a obviously U.S. company, does this bring the idea of a potential U.S. listing further down the road back on the agenda?
Well, you know, I think we never kind of have given up on the idea to also expose ourselves to the U.S. market. However, you know, currently we don't feel that you know, it's the right point in time. I mean, an investor like you know, the funds which invested out of KKR is certainly a supporting element for whatever we might plan in the future. Again, we haven't been specific on any timelines and plans as to a potential asset listing.
Okay, fair enough. Maybe on your preclinical antibody. Quite clearly, lecanemab data have really sparked interest in those class of drugs. I was just wondering whether this changes anything in the way you're thinking about opportunities for your own preclinical asset.
Not really. I mean, we always believed in our antibody being really interesting, you know, and a good one. But of course, I mean, we see, as you say, logically sparking interest in that area. I mean, this in the end, we think, could only help the case. As you know, the antibody is still in preclinical stage, but we continue to develop that and, yeah, and then try, of course, always to, you know, exploit the situation as it unfolds.
Just to clarify maybe on that. The plan A would be, I guess presumably not to really go into more expensive trials with this antibody, but is the plan A then really look for a partner who might either buy it outright or join to really help financing it? Or what's the plan A here?
Alex, this is Uli again. It's clearly an opportunity to enter into early partnerships, which we essentially already did in the context of the Simcere partnership. They are already taking care of the antibody. There's of course ambitious and I think it's a great asset to progress development mainly through our partnership with Simcere or potential future partnerships in rest of world, so to speak.
Understood. The very last one is with respect to Simcere. Do you know what their plan is in terms of, I mean, they licensed in two assets, right? The small molecule as well as the preclinical antibody. Do they simultaneously pursue both strategies in sort of in the development, or are they now mostly focused on the small molecule? That's the first question. The second question to it is whether you think or have indication that they are still able to start phase I this year.
About the first question, I mean, it comes from the nature of the deal we made with Simcere that as you remember, they required this option to develop the antibody. You might assume that of course, for the time being, the development of varoglutamstat or small molecule is a little bit prioritized over that. However, as we say, there's continuously working on the antibody as well. In terms of when the clinical phase is really starting, I cannot really comment on that because this is really in the hands of Simcere. As we indicated, the plans are ongoing and there's kind of a simultaneously work on preparing the phase I and phase II in China.
When this is really happening, if this is still within this year or at some point of time next year, I cannot comment on that.
Fair enough. Thanks so much.
You're welcome. Thank you.
Thank you, sir. We'll now go to Andreas Scauri calling from Lemanik. Please go ahead.
Yes. Hi, good afternoon, everyone. Thanks for taking my call. A couple of questions from me. The first one, a very simple question. I understood basically all the development, the success on the clinical trials that you had. My simple question is, what kind of explanation do you give to the fact that at the moment we are talking about a company with a EUR 200 million market cap, with this kind of potential ahead. So basically, what's missing in your view to let better understand the value inside the company of all the achievements that you have reached. This is the very simple question. Thank you.
Yes. Thank you, Andrea, for joining, and thank you for your question. It's really a tough question for us to answer because we can't really explain or comment on the dynamics of the capital markets. It's really tough for us. The question is what can we do? Here again, we are laser focused on increasing the value by progressing our development of varoglutamstat. I think we have very exciting milestones upcoming. Again, just to remind what we have presented in the presentation. We expect the futility analysis of the VIVA-MIND trial in the H1 of next year. We expect the full data readout in the H2 of next year.
There are exciting potential value inflection events ahead of us, which I would expect should impact the value perception of our company.
Okay. It's very clear. I try to better explain my question again. Apart from the recent fundraising of today and the entry of KKR, that is fantastic news for us as shareholders. Are you basically in touch or let's say, in the radar screen of larger pharma companies that are looking at your developments in order to finalize joint ventures, agreements, whatever. Now that the clinical trials, I repeat, are going much better compared to what were a year ago. These in order to fully exploit the value of the company. This is, I try to better explain the question. Thank you.
Yeah, Andrea, thanks. I think an important component was already mentioned by us in terms of, you know, how are we appearing on the radar screen. We have mentioned a couple of data presentations in the context of this prestigious AAIC 2022 conference, where there were a lot of attendees from the industry. Again, we believe that we sparked a lot of interest with the new data which we have presented there and that kind of, you know, makes us very optimistic here. That will be my answer to your question, yeah.
Okay, great. Thank you.
Thank you Andreas. Turning back to [Uncertain].
Thank you, sir. Want to go to Albrecht von Witzleben calling from von Witzleben Asset Management. Please go ahead, sir.
Yeah. Thank you. I hope you can hear me. I'm calling from overseas. My question is the following. We are loyal shareholders. We have also been in the capital increase only five months ago at EUR 10.50 a share, and we are a bit surprised that we were not offered any dilution protection in the current round at EUR 7.30, which is 30% below the EUR 10.50 in April. Are you planning any measures to at least protect that group of shareholders that were part of the April capital increase to protect them from dilution in this round?
Yeah, I mean, we were pretty transparent, I think, with the terms of this transaction. The question if I read it right, so why did we choose for this type of deal? I mean, that's always a careful evaluation of different options to ensure that the company is well-funded and able to deliver on strategic objectives, yeah, thereby also generating stakeholder value. Let me make it very clear that our commitment is first and foremost to our patients, to varoglutamstat mode of action, which to our knowledge allows the intervention upstream of all other approaches currently in clinical development. We really have a unique chance in our hands.
We believe being able to progress our clinical studies and, you know, providing our study drug to all those participating in VIVA, VIVUS and VIVA-MIND is of utmost importance and
That kind of, you know, build the parameters for our decision here.
I don't understand. What is the downside of offering shareholders which were giving you money in April at EUR 10.50, what is your downside in offering them the same terms? I can't see any downside for the company.
The particular terms we were discussing here with the management and the board, in our view, were necessary to attract such kind of investors with whom we are talking about. That's the basic answer to your question here.
They were asking you not to let-
There's no actual questions.
-any other shareholders. They were asking you not to let any old shareholders participate in this round. Is that the way I have to understand this?
It was a deal which we made in alignment with the partners. It was a mutual decision to structure the deal to make it a yeah win-win for both sides here.
Okay. It's just hard to understand. Okay.
Thank you.
Thank you, sir. Ladies and gentlemen, once again, if you do have a microphone that is far away from where you're speaking from, just please approach your microphone before asking a question. Thank you. We'll now move on to our next question coming from Chris Redhead, calling from geotz artners. Please go ahead.
Hi, guys. Yeah, sorry, I got booted out of the call for a little while, so I hope I haven't asked something that's already been asked. Yeah, just in terms of this, just kinda interested, very interested in the combination therapies that you talk about. As I understand, the antibody that you've done those studies in is similar to the Lilly one. Is that the case? It's a N3PE anti-N3PE antibody. Is that right?
That's correct. Our own antibody basically has the same target as the Lilly antibody and as our small molecule in the end as well. N3pE. That's correct. However, our antibody is kind of modified. I mean, you know that the antibodies they have this part which is important for recognizing the antigen, and they have this other part which is called FC domain or so, which has some effector functions. Within this domain, we have put in a specific point mutation, which then leads in the end to having the complement system not activated by this antibody. This is what our other antibodies would do, which don't bear this point mutation, which is patent protected also by us.
This leads to much less or much lower immunogenicity profile of our antibodies, leading to, again, presumably less antidrug antibodies, but also less ARIAs. It's a modified N3PE specific antibody we are developing here.
Right. Actually, this is what I was kinda getting at, was that you've got this very interesting data with lecanemab, which, you know, it's now you're now looking at the soluble. Do you have any sense of how much lecanemab is taking out the N3pE? I don't know whether that. If there's any data on that. Because it's kinda interesting that that antibody works and actually the combination of your product with that maybe have a an even broader effect, given that it's a different. That the antibodies has a, you know, has a different target. I'm just sort of kind of thinking about the different combinations, all these different combinations that you can sit in the middle of essentially.
That's definitely the case, or what we're assuming. I mean, you know, we have published this data with our antibody. We have published data with aducanumab combination at the AAIC. Yeah, you might assume that we're looking into other antibodies as well, but there's no data I can report to you now at this. Ulrich Dauer wants also to add something.
Yeah. Adding or answering your question. How much of potential N3PE would lecanemab capture? I mean, we can only speculate, but what we believe is that in soluble aggregates, the toxic potential of N3PE, according to our knowledge and also other publications, much higher than in the soluble plaque. This is a key differentiating element of lecanemab, and that's why we are saying, obviously it shows that, being more upstream in the aggregation cascade of Abeta seems to be a successful strategy, and we are even more upstream. We are even preventing the formation of N3PE and not taking it out once it's established. That is the kind of, you know, an exciting fact that.
Yeah.
We've been observing.
It's a confirmation. That's kind of what I was thinking about was that actually the lecanemab is by its nature, also kind of not specifically targeting, but is taking out the N3pE in a much larger way than some of the other antibodies, right? Okay, that's it. It's actually kind of, you know, confirmatory in that sense that the N3pE really is the target, you know, or is the, you know, has the potential that we all hope for.
Yeah, absolutely. We see that as an endorsement of this hypothesis, absolutely.
The other quick question I've been meaning to ask for some time. Your drug is oral, did that help with process? 'Cause presumably, you know, the patients didn't have to go into hospital, not necessarily to get their infusions and things. Is that the case that you could more? Sorry.
Yeah, I mean, absolutely. In two ways. One, you're right. They have to go into the hospital to get their infusion. Secondly, that is a requirement still for aducanumab, which is approved, and we are curious to see how that will play out with lecanemab. Patients obviously have to be very closely monitored towards the risk of developing ARIA. That also makes the kind of therapies quite expensive and also quite inconvenient for patients. We see absolutely these two advantages. We haven't seen any ARIA events in our interim data in VIVIAD. We have an oral pill which can be taken at home and conveniently.
Yeah. Well.
I want to add to that, Chris.
Yeah.
Chris, I just think while everybody can maybe just think about himself in that regard. The question is very simple, whether you wanna go with lecanemab, it's actually even bi-weekly, every two weeks, or at least with other antibodies every four weeks to the clinic, and sitting there or being there basically half a day because you, as Uli said, you need to be monitored versus just taking a couple of pills in the morning and in the evening. I mean, that's. Of course we think that's kind of a great advantage.
Yeah, it's a huge advantage, you know, particularly in that, in this patient population, in an elderly patient population, which we know are in any case susceptible to these kinds of infections and that, you know, at any stage you want to keep them out of the hospital, right? So, you know, even-
Exactly. Yeah.
Yeah. Okay, great. That's me done. Thanks.
Thank you, Chris.
Thank you much, sir. As we have no further questions, I'd like to call back over to Mr. Ulrich Dauer for any additional closing remarks. Thank you.
Yeah. Thanks, George, and thanks everybody for joining us at this very exciting time for us. Yeah, we really look forward to continue to update you and to welcome you in our next call. Thanks very much, everybody. Bye-bye. Have a nice weekend.
Thank you, sir. Ladies and gentlemen, that will conclude today's conference. Thank you for your attendance. You may now disconnect. Have a good day and goodbye.