Edward Nash. I'm a senior biotech analyst here on the equity research team at Canaccord Genuity. I have the pleasure of having Biora with us today, and specifically, Adi Mohanty, the Chief Executive Officer of the company. Welcome. Thank you for joining us.
Thanks for having us.
I would like to start off, as I do with all the companies, to have you to put things into perspective, maybe talk through a 10,000-foot view, as to what Biora does, how you do it, and just very briefly, just your, your current pipeline.
Okay.
Brief.
Yeah. Well, that, that's pretty much the entire presentation.
The presentation, right?
Yeah. So, I'll just put up a slide there. We're working on two platforms that are devices, but the magic is the drug device combination. One is a targeted localization technology, and one is for systemic delivery. I n both cases, what we're trying to do is use these devices to be much more precise and needle-free in delivery of complex oral molecules. And our platform on the NaviCap side, which is our targeted mechanism, we're running a UC trial. We're using this to deliver drug locally in the GI tract, and we picked UC as a first target. And we'll talk a little more about that. We've just got some really interesting data. And the other one, which is BioJet, we're able to take all these different complex molecules...
You know, the larger molecules are more difficult to make orally available. And for us to be able to make that needle-free into a pill was really cool. And what i s great about our technology is we could essentially take your current formulation that you use in your needle-based delivery, so whether it's a SubQ or IV, you can take that same formulation, put it in our pill, and be able to have that orally ingested and then systemically available, and we've done many different molecules with it. We are trying to make sure people see that we can do, you know, peptides, antibodies, oligonucleotides, all these different kinds of molecules.
Our goal there is to try and get 1 or 2 or more partnerships and move some of these along before we work on doing our own programs, you know, resources, appropriate use of it. A t the highest level, I guess I would leave it there before I end up talking for the whole time.
Great. Well, appreciate it. Y ou referenced the data that you had in July, the phase I data. Could you talk a bit about that? One thing that, just to maybe preface that i s really important for people to know, maybe you might have... might be saying this, but is that for a company like yours, phase I data really matters. It really means a lot with regards to... because you're taking drugs, in some cases, that already have been out there and approved, but it's your ability to show that you're able to get that drug where it needs to be at the same levels that the currently approved drug has. M aybe you could talk a little bit about that phase I data.
Yeah. You're exactly right. W e're using tofacitinib, which is, well, Xeljanz. It's an approved drug. It's a JAK inhibitor. It's been used for many, many years. It works extremely well, but just like most JAK inhibitors, it's got toxicity issues, and the beauty of what we're doing is we don't have to prove the mechanism of action of tofacitinib. Everybody knows it works. In fact, what everybody knows is more is better for the disease. There are better therapeutic outcomes if you can have more of this drug in the colon. But these things are systemically absorbed, go all through the body, and a certain amount ends up in the colon. In order to get more in the colon, you have to keep increasing the dose, and that means all the different tox issues. We take that, and so we have a proprietary formulation.
We've made it into a liquid, and we put it in our pill, and we deliver it to the colon. T his is our NaviCap technology. It is, anatomical or physiological detection. I t detects, you know, esophagus, stomach, small intestine, large intestine. In this case, we programmed it to drop its payload at the beginning of the colon, and as it drops the payload, the normal motility of that colon spreads the entire, coats the entire colon. We've done many different, trials before, so we did device function, just the device itself, healthy humans. We did it with a payload that we could take pictures of, and we've got some really cool pictures.
We've done it in patients, so, we take UC patients, all kinds of different severities from, you know, Mayo Score of 2, a Mayo Score of 8, so across the spectrum, and it works every single time, and we've got these great pictures to show it drops a payload. When we did our phase I trial, like you said, for us, it was a really big deal. It wasn't just about trying to figure out, you know, if tofacitinib was safe or if our device was safe. We've already collected a lot of data. Along with the typical safety information, we did some biopsies of the tissue, which is not typically done in a phase I. This combination, we just reported results a couple of weeks ago.
We had this really nice KOL event where we walked through how our device, greater than 95% of the time, so pretty much every time, found the colon, dropped the payload, and the three biopsies that we took were at the distal end of the colon, so towards the end of the colon. All three sites had drug in that tissue, even though we took the biopsy 24 hours after the dose, which is something like four or five half-lives after, and so this is like a long time. And on top of that, these being healthy patients, that was a full colon prep. Ri ght at the time of Tmax, where you have the maximum tissue concentration or even blood concentration, is when they started the laxatives and the whole colon prep.
In spite of all of that, we found IC50 levels in the colon, which is great, and we found a great correlation between what, what's in the plasma and what's in the tissue. Typical tofacitinib gets absorbed in the small intestine. In about 30 minutes you see it in the blood, and then it spikes up and drops down very quickly. We found first indications at about 6 hours and peaked about 8-10 hours. I t went through the tissue in the colon into the blood, and we found 3-4 times less than what you would if you took the traditional tofacitinib, which is great. We want less in the blood. This is what leads to all those toxic events. So, we were able to then do that correlation and say we were definitely over IC90 for a substantial period of that time.
This is really exciting. I f we can get just a single dose of 5 or 10 mgs instead of the 20 mgs a day that is prescribed, get more in the colon and less in the blood, we're solving all these things, and the answers we got with the biopsies and the plasma concentration give us significant confidence moving forward. It 's really cool.
Okay, 'cause that was my next question, is that you had—you talked about the maximal levels occurred at 8-10 hours versus 30 minutes for the conventional oral tofacitinib.
Yeah.
T hat's the importance behind that as clearly as. [Crosstalk]
Well, yeah, I mean, you know, so there's a lot of blood vessels r i ght by the small intestine. It goes into circulation, and it makes sense, and it has a very short half-life. It quickly goes up and comes down.
Great. And is the biggest advantage related to safety, or is it really hand-in-hand efficacy as well?
There's a cool picture. Let me see if I can... Okay, here we go. T here's a lot of approved drugs. You, you see, like, a whole ton of approved drugs, and yet there is a giant gap. Almost all the drugs get approved with something like 15%-30% response delta compared to placebo. That induction rate is really poor, and over time, that also disappears, so many of these patients, over time, cycle through all these different drugs.
O ur goal is to be able to break that ceiling. It's less about the safety. The fact that we can make it safer actually allows us to give more dose so that they can get more in the tissue. In fact, in the KOL event, D r. Feagan, one of our KOLs, talked about where, even, I don't wanna mention their name, the owners of Xeljanz had tried 30 mg a day because more would be better.
The tox events were kind of difficult to handle, but they got a higher response rate than even the 30%, closer to 40%. They got a pretty high response rate, but they couldn't do that 'cause already 20 was giving them enough tox levels, so the label is 20. Some physicians do use 30 sometimes, and Rinvoq, which is another JAK inhibitor, does about 45%. T hey keep trying to do more. They keep hitting this sort of ceiling of response rate. We absolutely think we can break that ceiling, and that's why we're trying to move this forward, is to be able to have better outcomes. Yes, safety would be good, but it's really about trying to break the therapeutic ceiling.
Got it. Your other program is using adalimumab, which is also targeting for UC as well. Are there other potential indications you can go after that would allow for targeted therapy beyond UC?
Ou r NaviCap would be GI-based, and yes, beyond UC, other GI-based diseases, other beyond IBD, are definitely potential targets. Yes, we have adalimumab, and that also has shown, there's publications that show that they would work better with localized delivery in the colon, anti-TNFs, anti-integrins. There's a few papers that keep talking about getting it to directly local delivery in the colon would give better responses than they currently get. W e think there's an opportunity for us to optimize the way UC drugs can get used, but also facilitate combination therapies, which are already being tried, the difficulty being, you know, trying to combine two toxic drugs to get a better therapeutic outcome creates a lot of limitations.
We think we can facilitate all of those, go beyond UC, and potentially go beyond IBD. A little at a time. We're also quite focused about being resource-efficient as a small company, so we wanna get that proof, take it a step further, expand the pipeline over time, but not in a rush.
Just to be clear, again, NaviCap is what you guys are doing proprietarily, internally, and then BioJet is what you're using as your partnering vehicle.
It is also proprietary, but yes, BioJet is where we expect to be able to do partnerships right away. With NaviCap, we'd love to move that a little further in the clinic, because we absolutely think that there would be people interested. In fact, we have had calls in using NaviCap, as a delivery mechanism for various therapies. But we think a little more clinical data would increase the value, of what we think is an extremely valuable asset.
'Cause right now you, the company itself is not running any trials with BioJet, correct?
That is correct.
Okay, and how many partnerships do you currently have with BioJet?
We have collaborations [crosstalk] with BioJet. We have several collaborations. We've been able to talk about a couple of them. Some of them are mega cap companies in our space that, well, you know, they don't allow you to use their name, which is, which is fine. We've said we've worked with AstraZeneca, with Ionis, and other bigger companies. Those collaborations are great. There's a great way for us to figure out what they're looking for, performance characteristics, what would be potentially acceptable commercial parameters, and allows us to tweak our technology to get there. And we're close to now evolving those, what I call, from collaborations into real partnerships.
What about partnering on the NaviCap? [crosstalk] Is that just hasn't been, I don't wanna say interest, but you've really just not made that available for partnering. You'd really rather just keep that internally at this point?
Until we finished our phase I, i t was, there were several questions that we were unable to answer extremely well. There's a lot of... You know, it's a first of a kind. [Crosstalk]. There's a lot of questions. It was a first of a kind with the FDA, so our, you know, took a while to get through all the FDA interactions to get a trial approved in the U.S., to do something like this. There was those questions, there was the question about, what exactly topical delivery might look like. Would it really have localized absorption?
There were many questions that we had a harder time answering, which we are able to answer now with our phase I data. T hose conversations we put on hold until we could prove that, and now we're starting some of those conversations. Clearly, we're open and ready and able to. We think, though, that the value might be better if we make a little more clinical progress.
But yes, that was not a focus for the last year. We said, "Let's move this through the clinic, and then we'll come to partnering discussions." Whereas with BioJet, it was clearly driven towards trying to make some partnerships happen.
I t's not been long. It's just been July since you had that data, but what are kind of the next thoughts clinically for, for the program, for tofacitinib?
Couple of things are happening. O f course, like you said, we, we reported a lot of the data, but, you know, the reports are not done. We gotta get all the final reports. When we gather all of them, we expect to go back to the agency and explore a potentially larger UC trial, maybe a phase Ib, a 2a, something or at least a very simple, small UC patient mechanistic trial. W e got data with healthy volunteers.
And there's enough information, but maybe not confirmation, that UC patients will probably have a slightly higher tissue uptake than healthy patients. They've got lesions, inflammation, they've got, you know... In the colon, there's reason to believe that there might actually be better tissue uptake in UC patients. M aybe getting a little bit of information on UC patients mechanistically would allow us a little bit of sort of design refinement for a larger efficacy trial. But we'll explore both of them over the next few months with the agencies as we get all the final reports, and so our goal-stated goal has been to start the next trial in UC patients towards the end of this year.
While these are, these are again, your—these are drugs that are already approved, you would still need to run a full induction maintenance trial likely, right, for full approval? Or is this something that's just still you're trying to think about how to approach and negotiate with the agency?
So, we think it should not require the full. You know, in a typical UC trial where you do a phase I, 2, 3, confirmatory, we think there is a way to have a shorter trial or a shorter path to approval. Certainly we think that that next trial with UC patient, that data would really inform whether or not we could take a much shorter path to approval, or it needs the full-blown all steps. W e think, induction, might be enough, and we may not need multiple trials.
With regards to the same with adalimumab, is this something you're using, are you gonna be in lockstep with tofacitinib, or is it just you probably wouldn't take that any further, it's just more to see with a different mechanism if you're able to use that within your device?
W e've got some preclinical data. Given all the firsts that we're doing, with the agency for this drug device combination, it makes sense for us to take one more step and then figure out, what our combination of device and adalimumab would look like. We would benefit from what we have done with the agencies. We might also benefit from both sides, agencies and us, learning some things that could make the next one easier and faster. W e would, we would do it that way. O ur current focus would be try to move tofacitinib through that next step, be open for partnering discussions, 'cause beyond JAK inhibitors, all these different, types of molecules also would benefit from local delivery. And kind of keep that within the, what we're working on.
Have you discussed with the agency with regards to next steps, what auspices, whether the agency would oversee? Would this be partially device and partially therapeutic, or would it be therapeutic, but device has a seat, per se?
W e, we've had both of them through these last two years of interactions, both the drug side and the device side. Interestingly, in the last interaction we had, the head of the team, the cross-functional, cross-department team, was the head of GI, which is a therapeutic person. Could that evolve? Yeah, but given that, well, you know, there are several device-related issues and regulations we have to meet, but the outcome we're measuring is drug-related, and the therapeutic outcomes are drug-related. W e think in the end it's probably still gonna be higher sort of therapeutic side and device people at the table, but it could change. That's okay, we've worked with both of them. We've gotten pretty comfortable, we've learned a lot together, and we'll continue to learn.
I may have put the cart before the horse because we've talked about the therapeutic side of the two programs and what you're working on. But maybe a little bit more into the actual device itself. You've talked about NaviCap, how it's able to sense and be able to detect different parts within the GI tract. Can you talk a little bit more about that technology to the degree that you can? It's internally developed, right? And maybe just kind of explain, 'cause I know that seems to be still a little bit of science fiction to some people.
It is. It's cool. I t's really cool. It's like rocket science, yes. No, we actually have a lot of... I won't do that now. I've got a video here. We've got some, a lot of information on our website as to how this works. Completely homegrown, owned by the company, done within the company. Yes, it's really cool. It's a little bit of a, you gotta take a step because when you receive the pill and you push it, it starts to flash. It's got colored lights that are flashing, and that's kind of at the core of the technology, and when you swallow it, the colored light bounces back, and the different colors bounce back at different wavelengths.
I t's an algorithm that there's a chip on board that actually has been trained, so with lots of, lots of data and many iterations, to recognize the change in wavelength based on the physical geometry and the texture. T he wavelength changes as you go through the body, and we've been very accurately been able to figure out where it is in the body and program in what action to take.
W e've actually published a paper where we collected a sample from a certain part of the GI tract repeatedly with multiple pills, and so, you know, non-invasive way to get an internal sample. And the one we did here, which is then drop a payload at a certain location. Yeah, we continue to evolve that technology and keep it moving, but really cool. Please take a look at the website. There's some really cool information. It's very well covered with our IP, so we're not afraid to talk about it.
It's that change in wavelengths that signals the release of the drug.
That tells you where it is, and then there's a chip on board that has software that says, "Okay, when you recognize you've reached the beginning of the colon, drop the payload for this indication.
Got it.
It's cool.
It is. No, it really is. It is. Well, thank you very much. I really appreciate you taking the time. That was, it's really a really great story, and we've talked a lot about the fact that drug delivery used to be... It was its own major therapeutic area within biotech, and the analysts did nothing but cover it. But, it's nice to see this is kind of very different delivery technology than what we've used to seen in the past. I t's a whole different paradigm.
It is. W e didn't get to spend much time on BioJet, which is a much simpler technology. So the coolest way for me to say is, there are some companies that do over-the-skin sort of jet injections. We're doing internal jet injections, and we're so confident of our IP, we own any internal jet injection. So that, again, is also really cool. Simpler technology, but that one is pH-based. When it you know when it gets past the stomach, the pH trigger goes off, and then it shoots it into the side of the small intestine. So that is also cool that we are able to do the simplicity of, "Okay, when you work with us, you don't have to worry about your formulation," and our collaborators have learned that.
That's what i s lately the biggest excitement for us, that in the next very short few weeks, yeah, we expect to be able to talk about partnerships that we're getting close to actually completing and being able to talk about them. So we're getting close even on that. So even that is worth looking up to say, "Okay, you take a pill, and there's an internal jet that shoots liquid into this," and it works.
Fantastic. [Crosstalk].
We've presented lots of data on it, and it works.
Stay tuned for more.
Absolutely.
Thank you again for joining us.
Thank you.