Hello and welcome to Virtual Investor Conferences. My name is Anthony Kraus, and on behalf of OTC Markets, as well as our co-host, Zacks Small-Cap Research, we're very pleased you have joined us for our next live presentation from ZyVersa Therapeutics, Inc. Their session will be monitored by Brad Sorensen, Senior Equity Research Analyst with Zacks Small-Cap Research. Please note, you can submit questions for the presenter in the box to the left of the slides. You can also view a company's availability for one-on-one meetings through the Schedule Meetings tab found on the conference platform. At this point, I am very pleased to welcome Stephen Glover, Co-founder, Chairman, CEO, and President of ZyVersa Therapeutics, Inc., which trades on the Nasdaq under the symbol ZVSA. Welcome, Stephen.
Thank you.
Yeah, thanks for everybody. I want to just give a welcome to everybody on behalf of myself and Stephen. And I'm really excited about this presentation. I do a lot of biotech analysis, and this is one of the most exciting companies that I've come across. I'm privileged to be able to host this and moderate the discussion. We're going to start with, and I always think it's a good idea to start like this so we all get an idea of what the company is all about because it's very exciting. And then we'll get into some questions and answers that I have. So, Stephen, do you want to kind of give us the high level of your company?
Sure, happy to. So I appreciate the time today and to have a good conversation and kind of let the investors kind of know what we're up to. So a little bit about me, just so everybody knows, a guy on the other side, so to speak. I've been doing this for about 42 years in the biotech industry, and this is my third. And I swore to my wife my last company that I would take public. But I have a bad gene around wanting to do things for patients. So always fun to see success and patients get better therapies. I mean, from the company's perspective, both the products that we have are out of the University of Miami Miller School of Medicine. I'm fortunate enough to sit on the Innovation Committee down there and get to see some great science.
About 10 years ago, I ran into two projects I got very interested in. Those two projects, one is in kidney disease, the other one is in the area of inflammation. We spent about $40 million to get to the point that we're at of funding. We went public a couple of years ago and really emerging into the next stage of the company. We're really excited by the next year here. We've got a lot of things going on. From my perspective, just if you want to look at it from a high level of the company, we're targeting two areas that are about $100 billion of total available market.
We've done a lot of work in getting some really nice patent positions for the company, both in the kidney disease area as well as in the inflammatory area related to areas such as Alzheimer's disease and obesity and metabolic disease, and some of the things we'll talk about today. We've done this through a combination. As I mentioned earlier, this is kind of my third company. We funded this company initially through high-net-worth investors that I had taken our companies public with. And we were able to augment that with funding from the NIH as well. And as a result of that, we've been able to use capital expeditiously to bring it to the stage of the products today. I mean, from my perspective, it's a great area of unmet medical needs, and it's an area of high investor interest as well.
Both the kidney, the obesity, and metabolic space are really sought-after areas. So from that perspective, at a high level, we'll drill down a little bit into the program here. But Brad, any questions at this point?
No, I don't think so. I think the connection with the University of Miami is always interesting. I always like to see when academic institutions and corporate can come together and actually do some good for the community, so that's a good point to make, and yeah, we'll get into a very obviously, obesity is a big subject right now. We can't go 10 minutes of watching TV without seeing an ad for it. So I'd be interested to hear more about what kind of treatments specifically you guys are working on.
Sure. So from my perspective, we spent a lot of time trying to understand where to enter into the markets. Here's just a kind of a portfolio view of the areas of which we're doing research in. And the top blue areas in the area of the inflammasome are what you'll see me refer to as the IC100 program or the inflammation program. And our focus has been in this obesity and metabolic side, which I'll drill down here in a second. That's just nearing completion of our preclinical, getting ready to go into the clinical stage of development. And then the bottom program is really a really interesting program. We're now ready in this program to do first patient, first dose in the kidney program in phase II. So you'll hear me talk about mostly the top program, just based upon the amount of time that we have.
But the second program that is moving into phase II is really exciting. And we expect some readouts of that program mid-year 2025 in our first phase II. From that perspective, I was just very much involved in obesity and metabolic diseases since my time at Amgen and Roche over the years. And one of the things you're seeing here is a transition that takes place in every market that develops. So the GLP-1s, you joked about it, Brad, you can't go on a TV ad or anywhere and not see happy people losing weight. And I think that's an important thing to understand, that that's just the beginning of the issues that people are dealing with. One of the things that Obesity Week was just finished up last week. And one of the key themes out of that conference, which has grown about 5,000 people, was what's transitioning here.
I heard a really interesting position here was weight loss is only a piece of obesity and its disease-related comorbidities. That's really where the markets are headed. From the investor perspective, the question always is, well, what's next? Where's everybody headed? What you're seeing is, and you've seen the analyst community pick this up as well, we're transitioning to combination therapy. That's really an important piece to understand why. The reason is, picture's worth a thousand words here. You've got 50% of the worldwide population that is over a BMI of 30. That BMI over 30 is driving a lot of comorbidities. It's driving things like kidney disease, atherosclerosis, Alzheimer's, Parkinson's, CV disease, type 2 diabetes. When I talk about comorbidities or combination therapy, really, this is the trend that I'm talking about.
And if you look at big companies like Roche and Novo and Lilly and the companies that are in this GLP-1 space, they're now transitioning their strategies to add-on or combination therapies to deal with these comorbidities. The first phase of this has been around the transition into muscle-sparing investments. So you see things like BioAge and some companies that went public. And that's really trying to combine a muscle-sparing product with a GLP-1. And the thought process there is that you can reduce weight without impacting a segment of the population that gets muscle loss. And you clearly don't want muscle loss to become a problem from a disease perspective. The next wave is these comorbidities, is adding products into the GLP stage of weight loss to treat the obesity complications. And that's really where the market is headed. And it's actually the areas of which we're studying.
So when you look at this, this is a phenomenon that's been in the medical community for over 40 years, which is how do I treat type 2 diabetes, metabolic diseases like CV, kidney diseases, which are all impacted by being overweight. And that's really where the markets are headed, looking for new therapies to do that. And they'll take my word for it. I'm partial here to what we're doing. But if you back off and say, well, what's going on in the sector? Well, here's what's going on. The most recent deals, whether they're IPOs or whether they're companies, are all about adding something into this endocrine or GLP-1 combination. So you're seeing companies such as Lilly and Novo and others like Roche acquiring products or co-developing products.
You're seeing companies like BioAge, one of the biggest IPOs this fall, go out with a muscle-sparing approach, who has happened to be partnered with Lilly. So I think you're seeing this from the investor and from the M&A perspective. And the reason is, pharma can develop products now for the next 20 years on the backbone of these combination therapies. One of the areas that investors may not be as familiar with is in the area of inflammasomes. These are products of which we're working on and other companies are working on that go after the inflammation component related to obesity. And what people may not realize, unless you're following the diet issues around inflammation, is that inflammation from cytokines, IL-1 beta, and IL-18, are causing a lot of these comorbidities driven by obesity. So the research area here is really exploding.
It's an area of high research and partnering. Just recently, Sanofi partnered with one of a group of companies. One is Ventus for a combination therapy with their product. Roche has announced on their Investor Day their combination approach to their inflammasome inhibitor, and then Novo, about two years ago, the biggest GLP-1 selling company, has a product in the inflammasome space as well, and the reason they're wanting to do this is to go after those comorbidities, things like CV disease, metabolic syndromes, those things that I talked about earlier, so this is kind of what was heard at Obesity Week. This is kind of the trends and directions, and this is what is exactly going on with the industry and under the question of what's next, so why is that, so if you take a look here, this is a complicated slide.
And I'll highlight really what's important here. We have an inflammasome inhibitor called IC100, which impacts multiple inflammasomes and a structure called the ASC speck. Now, why that is important is when you have obesity, you have adipose tissue. And that adipose tissue generates inflammasome reactions within the body. And really, what that means is it's stimulating inflammation. And what happens when you stimulate inflammation in the body is it's being driven by diet. It's being driven by some of these comorbidities. But in essence, this cascade of inflammation drives hypothalamic inflammation as well. And the response in the human body to that inflammation is to guess what? Satisfy it. And so you eat more fatty foods. You eat more processed foods. This weight gain then leads to this inflammasome release.
And when these inflammasomes release, this is where you get systemic problems in the body, with obesity driving type 2 diabetes, cardiovascular disease, and on. So really, the trend here is to then develop these inflammasome inhibitors to attack this inflammation cascade. And by doing that and adding it to a GLP-1, such as Wegovy or other products in the GLP space, you're able to treat the patient holistically, not only reducing the weight, but treating the disease of obesity. So that's just a quick view of what's going on. It's really important to understand this. And for the investment community, I always get the question, as you would expect, well, what's next? What's the trends and directions? And we're right in the middle of this. And that's why we're so excited. We released earnings this morning and results kind of outlining kind of where the next steps are.
So we're really excited about where we're headed over the next 6-12 months.
Yeah, it is very exciting. I saw the earnings release. So we may touch on that a little bit. I want to back up and kind of start where you ended, I guess, and talk about a little bit more about the obesity add-on. I guess, like you mentioned, there are a lot of companies going after this space in a lot of different venues and ways and methods. What makes your company unique in what they're doing? And are there specific comorbidities that you're targeting, or are there just a broad range at this point, and you'll target them later as you test more?
Great question. And we did something kind of unusual. This summer, we spent about three months talking to some of the leading people in the industry on the academic and treatment side. And we formed an SAB. And we really went after this question you were talking about. Well, where do you now, what do you think the gaps are? What do you need in treatment? And what are the priorities here? And as you listened to their feedback, it was, well, we need to inhibit this inflammation that's causing type 2 diabetes, cardiovascular disease, and kidney disease. These are things that we are dealing with because we can get the patients to lose weight. But the problem is, when they do that, they're not necessarily healthy still. They still have obesity as a disease.
What we're studying in our work in preclinical is this intersection between these metabolic markers and cardiovascular disease, Type 2 diabetes, and kidney disease. And those three areas are the areas of our initial focus. But if you go back to our pipeline slide, we're also looking at areas such as Parkinson's. We're working with the Michael J. Fox Foundation on obesity. And we're doing some really interesting work on areas called inflammation. And this is aging and Alzheimer's and cognitive impairment and CNS diseases associated with obesity. So our focus is pretty broad, but the next six months is really on that metabolic intersection that we just talked about.
Excellent. And then, none of us are, none of us on this side of the camera anyway, are PhDs. And I don't think a lot of us listening are doctoral candidates. But is there a high-level explanation you can give of how you think this works? What's the science behind the IC100 product, how it actually works to reduce inflammation?
Sure. So I'll do, as I always say, I'll try to do the English version versus the PhD version.
Excellent.
In essence, when you have an insult to your body from a virus or bacteria, or in this case, food, which is kind of a concept that's really interesting to think about. When this happens, the body stimulates a structure called an inflammasome. And just think of that as a way to stimulate inflammation. And if left unblocked, these inflammasomes drive these comorbidities: CV disease, type 2 diabetes, weight gain, kidney disease. And our product has been developed over the last 14 years almost now to target that and block that inflammasome activation. And by doing that in essence, what you're doing is blocking this inflammation, both the acute phase of it and then the chronic phase of it.
And by doing that, believe it or not, you can slow down the progression of the diseases, we believe, reduce the inflammation load that we need to do, and treat this. So a good analog is when you look on TV around drugs like TNF inhibitors. These are things like Enbrel and Humira. These are used in RA. These are some of the largest-selling drugs in the world that's inflammation inhibition at work. So that's really, this is the next generation in many ways of inflammation inhibition.
Excellent. Yeah. And so I see, and I've actually read some of this, and I kind of want you to go into it because it is very interesting. I want you to kind of tell investors, you haven't done preclinical tests on this, and that gives you hope that it will work and belief that it will. What are some of the preclinical results that you've seen from that test?
Sure. So we started out. We worked with the Lois Pope Life Center down at the University of Miami. All of our research is done with the founders of this technology. This is what they've done for 20 years. And they're well published. I mean, they're well-respected KOLs in this area. And so we started out and looking at inflammation in CNS diseases. And then as we looked at that, we got some really good results in MS and early-stage Alzheimer's and things like that. And as we did the research, we started to realize this intersection between inflammation in the CNS system or in your brain and the inflammatory response and obesity. And really fascinating to take that leap of faith and understand it. And as we were doing that, other companies were doing the same research too.
And came to the conclusion that this whole inflammation area related to obesity is really where our focus is. And so a lot of companies have reported out their data showing that in the inflammasome area in particular, that this intersection of inflammation driven by inflammasome and obesity is a real thing. Peer-reviewed publications are out there. A lot of talk about it, these partnering activities that you've talked about. The key to that is doing these things called DIO models. These are animal models that are designed to mimic the human body. And that's really our next stage of research. We announced it this morning in our earnings and progress. We are initiating our DIO models in both the use of our drug and monotherapy and in combination therapy with GLPs.
And we think we're going to have a better mousetrap here because we're inhibiting multiple inflammasomes that are involved in these diseases, not just one, which is what the competitors are doing. And by doing that, we inhibit the acute stage of this. And the data is pretty robust here. But we're also looking at this progression of the disease over time, or in other words, the ongoing inflammation that takes place in these diseases. And we're one of the first ones to look at inhibiting that through inhibiting a broader range of inflammasomes and a structure called the ASC speck. And we'll be the only one company doing that. We'll be doing it with a biologic. And really, over the next three-to-six months, we'll be reporting out that data around those results in those DIO models, which will be a game changer for the company.
Yeah, definitely. These DIO models are very highly respected. So I guess let's just veer off just a little bit. And what is the, like, do you have your own manufacturing facilities? Who manufactures the drug for you for these testing? It's usually in small samples that you need at this stage. So just kind of briefly on what the process is to get the amount of the therapy needed to do these tests.
Sure. So one of the great things is we do all of our research down at the University of Miami Labs. So we have all the innovators and everybody working together with our team, a very experienced team. And our KOLs and everybody are all involved in what I'll call the research side of this. And then we're fortunate enough that my team has been doing this for 30 years in the industry. And so we do all of our work in manufacturing with the key manufacturers in the industry. We're working with KBI out of Raleigh-Durham ourselves. We do all of our animal models either with the university or with a group called Charles River, which is an industry leader to do that. And then anything that we need to do with filling or distribution, we do with the core infrastructure.
So we're a pretty nimble company as a result of that, not with a big footprint ourselves, but with the skills to be able to work with the backlog of the industry to make things get done quickly.
Yeah, definitely, and that reduces the capital needs that your company would have to be able to build out something like that, so on that, just very quickly, you keep mentioning the University of Miami, which I think is great. Is there a deal in place as if this gets to where we hope it will and believe it will, percentage of revenues, flat fee? Usually, I've done other companies. There's usually some combination of those between the university and the company. Is there some sort of deal in place with the University of Miami about that?
Yes. One of the things that I like to do is make sure that the academic community gets rewards from the research over years, right? And that's all the companies I've formed. That's really kind of where you're, a lot of your research is really done there and in the federal government. Pharmaceutical companies take them and develop them really as well as goes on nowadays. And we have a nice royalty-sharing and agreements with the university in multiple ways for the university to get rewards for the progression. And we do sponsored research with them, which keeps their labs funded, keeps the innovation going down to the university.
Excellent. Yeah, I think that's huge. And yeah, I could talk to you for an hour, but I do want to quickly go to, you mentioned, and this is the one that's actually furthest along in the testing phase, the two, I'm just going to call them by their numbers, the 200 and the kidney research that you've done. What conditions in the kidney are you targeting? Is it inflammation-related? And then what stage is that in the testing and how quickly are we getting further results from that?
Yeah. I was at Amgen for years, and one of my passions between Amgen and Roche was kidney disease. And there hasn't been any really innovation in kidney disease treatment in 25-30 years. And the problem is it's a pandemic. If you want to talk about pandemics, 20% of the Medicare budget in the United States is spent on the treatment of kidney disease. And unfortunately, you get kidney disease, you progress, and you end up in transplant. And that's really it. You get some, you go to Fresenius and dialysis centers to keep you functioning, but in the end, you end up in transplant. One of the things I loved about the work at the University of Miami was we've been working with them on this product called VAR-200, who's really going to focus in on diabetic kidney disease.
If you see the symbiosis between inflammation, obesity, and kidney disease, this is where our intersection is. And what we're looking to do is go into phase II. We're ready to do that. Our first human trials are ready to go. We've got the sites lined up. We're ready to dose the first patients in the first quarter of 2025. And in that progress, on the progress of that trial, we'll have some readouts, interim readouts by the second quarter of 2025. So we're really excited by that program because it does something that has, at least in animals, that we haven't been able to replicate in the human body ever, which is slow the progression, remove the cholesterol and lipids from the cells, which are causing the death of a structure called a podocyte. And if that podocyte dies, this is where you get nephrotic syndrome.
That's where the progression of this disease moves forward and moves forward. You end up in dialysis and you end up in transplant. We're really excited to get our first clinical view of this in the patients very early in 2025.
Excellent. So yeah, and I will not leave time for client questions, and this is actually my next question, and a couple of investors have asked this question, so investors always want to know this, and I told you this already, but can you discuss the, obviously, there's capital needs in these kind of companies. Investors understand that. Can you just explain, because testing is expensive? What are your capital plans for the foreseeable future? How do you see that developing?
Sure. So having done this for a few years, I've raised over $500 million in capital. I've done about $12 billion worth of M&A and licensing. I'm chairman of a couple of companies on the Nasdaq. So one of the things I always do is spend time thinking about when you bring capital in and when you do it at the appropriate time. And in our earnings release this morning, we mentioned that we'd raised about $4 million of capital. And that will be a sufficient amount of capital to get us through the first quarter. As part of that, I'm obviously always talking to investment communities, talking about how to bring the capital in and bringing it at the right price to avoid dilution for the investor. So clearly, we'll be looking to raise capital.
Any biotech CEO tells you that is not telling you the truth because that's what we do, and we want to do it at the right way to get to the data, to get the results for the investors, so from our perspective, we're always looking to bring the right capital in at the right time to get the right value milestones done.
Yeah. And just following up on that kind of related, another client question is, are you looking at any merger, acquisition, partner, working with other companies, being acquired by other companies? Is there any thought of that, or is it for now focusing on going it alone and getting these to commercialization?
Yeah. One of the things in my background, as I kind of mentioned, I've done about $12 billion with M&A and licensing. One of the things you always want to do is be in contact with your potential partners. That's been my background for years. I was former chairman of Ambrx. Ambrx was a $0.41 company. We sold it in March to J&J for $2 billion in the ADC oncology space. And so why? Well, we were always in contact with the bigger companies, always seeing what they were looking to do, understanding where we should develop to get the data that they might need. So it's something you always, if you're thoughtful, are looking to do. And I'm happy to say that we're currently always in contact with those companies. We clearly see what they want in terms of direction.
It is clearly a strategic option for the company. I want to do that at the right time. You got to do it where it's the right time for the investor. Those have invested to get to the right inflection point. Something that clearly is there, as I mentioned, there's always been over $5 billion in M&A and inflammasome space over the last 24 months.
Yeah. Excellent. You always want to be in contact with that. Well, I have about 20 more questions for you, and so I encourage people to look into this company, contact the company. There's a way to do that, as they've mentioned, because it is a very interesting company that is what I like to call inflection points because it looks like there's going to be results in 2025. You get in early on these things, but I want to thank everybody for listening, and again, contact the company with questions, but for now, we're out of time, unfortunately, so I want to thank everybody, and thank you, Stephen, for your time. Really enlightening, and everybody have a good day.