Earnings Call: Q1 2021

May 12, 2021

You, and welcome, everyone, to the webcast for Silead Palmer's Q1 Report for 2021. I am Magnus Kropatsund, and I have the entire executive team here to update you on our progress. Now please turn to Page 2. We will be making certain forward looking statements on this call, so please pay attention to this. Now turn to Page 3. CDOTAMA is focused on improving the life for people with rare oncology related conditions by developing novel drugs to address unmet medical needs. We have 2 drugs in clinical development. Mangoral is in Phase III development, and we expect to complete the study in the second half this year. It will be the only product targeting an addressable market of $500,000,000 to $600,000,000 annually. Oncroll is being prepared for Phase II in the treatment of gastric cancer based on encouraging data from Phase I. We have a very strong and experienced team headquartered in Malte, Sweden with a strong track record in late stage drug development commercialization. We have a solid financial position. We have built an extensive global network to help us bring our drug candidates to the patients who need it. Now please turn to Page 4. Silipan is in a transformative phase as we're moving from late stage development into commercial stage. Our lead program, Mangoral, is expected to be launched in the U. S. At the end of 'twenty two or first half 'twenty three. We're highly engaged in the preparations. In the same time frame, we expect that the Phase II long haul will be nearing completion. Furthermore, as part of our strategy, we might expand our portfolio with additional drugs that fit our orphan oncology strategy where we can make significant benefit to patients. So this is truly an exciting time for a Celia Thomas, and we see tremendous value creation potential as we progress. Now please turn to Page 5. In Q1, we continued to make solid progress. In January, we presented an in-depth development platform for and how we can bring it to address unmet medical needs for people with gastric cancer. In March, we opened our U. S. Office in Woodbridge, New Jersey. This is one of the many steps we're taking to prepare for a successful launch of Mangrove. Later in March, we completed the directed share issue to raise SEK 200,000,000, which will fund an acceleration of our main role launch preparations and our Encore Phase 2 clinical study. Now please turn to Page 6. Now we'll go into more depth on our pipeline, and I'd like to hand the word over to our Chief Medical Officer, Karl Johan. Thank you, Magnus. Mangoral, which is a novel oral contrast agent for liver MRI, addresses a very specific unmet medical need. The contrast agents available today are all based on gadolinium, the heavy metal. Gadolinium should not be given to patients with poor kidney function since it is treated through the kidneys and slow elimination caused serious side effects. In the future, this unmet medical need can be met by Magron. The specific target population. It's approximately 4% of all patients requiring a liver MRI, which corresponds to an addressable market of approximately USD 500,000,000 to USD 600,000,000 annually in the major markets. The right side of the slides illustrate how MANGREN works. This is a real patient with colorectal cancer from 1 of our Phase 2 studies. The left picture shows an unenhanced MRI scan without a contrast agent standard procedure today for our atomic population. The right scan shows the same patient after administration of Mangoral, the contrast enhanced scan. Delivered and taken up Mangoral and appears to be bright. There's one dark area that's only visible after Mangoral and handset, highlighted in the red ring on the right hand side. To state the importance of a cost of data. In this case, case detected and localized, and the significantly improved for the health of the company. We are making good progress. It's also aided by the orphan drug designation from the FDA the ongoing pivotal Phase III study to take into China this year. It's important to note here is that Mangrand is the only Our ongoing future safety study, Burkel, is a Phase 2 PBC and safety of minecraft in the palm the population with population relations of 4 key concepts. As shown on the left, it is strong in field group concept 6 individual Phase 1 or Phase 2 studies, very copies will be found. These states that were confirmed by an MSD analysis pipeline 3 that show highly the primary endpoint of the diesel utilization based on the co primary service, diesel dealing with the agent and the new contract contract with both highly significant. Existing data also contains a direct comparison of the Albanian Basin with Autotelian. This demonstrates similar effect on the right side of the slide to illustrate the Phase 2 design study. It's a global study with 1 patient that can treat with FDA. Bethany. Sorry there, you're a little bit faint. We can't quite hear you properly. Are you able to get a little bit closer to the microphone? Thank you. That's much better than me. Right, right. Okay. So yes, so I was talking about the right side of the slide. And this study, which is a global study with 200 patients, has been agreed with FDA and EMA. And the strategy is to repeat and confirm the Phase II results using the same endpoints. Since there is no available contrast agent patients with impaired renal function. The comparator will be unenhanced MRI, which is currently the standard procedure in these patients. And finally, the follow-up for each patient is very short compared to most clinical studies. And this simplifies the operational procedure, and we will also have the finalized study results relatively sooner than the typical Phase III study. And as mentioned, the study is expected to be completed this year. So next Slide, please, number 9. Thank you, Kaan. I will share key highlights on our progress preparing for the launch of Mangrove. First, we estimate that the value of the addressable market combined growth to be between $500,000,000 $600,000,000 in our key markets, the U. S, the EU and this estimated to provide solid market research into both the volume potential for patients and procedures for patients and the price potential based on extensive interest from market access and pricing experts in these markets. Secondly, our amount of research shows that decision makers understand the unmet need for our target patient population and the value that Mango has. Mike. Our preparations for launch was planned, and we continue to see a strong case for building our own commercial team in the U. S. In March this year, we opened our U. S. Legal entity and office in New Jersey, which marks an important step in our loan preparation. Lastly, in December 2020, a patent was granted in the U. S. For our 2nd jurisdiction, which provides patent protection until 2,004. Please move to Slide 10. For the U. S, the attractiveness and clear market share provided a strong case for commercializing Mangalore, that means building a U. S. Commercial affiliate. We already have strong relationships with leading radiologists among our Phase III clinical studies, Pfizer from Liskitaberg. We've also partnered with specialists and organizations to win manufacturing and radiologists. We now also have our own U. S. Office, Acelia Pharma Inc, which represents an important step to engage more closely the key partners and the clinical community on the journey to make MANGRAD available to physicians and patients in the U. S. The target patient population for Menghra has multiple health populations, makes a little metastases and poor people. This means that physician makers for its use are centers around 2,000 radio agents who can be found at around 400 building our own U. S. Commercial team in the U. S. Allows us to create an attractive top line and retain value in the country. For other markets, EU and Japan represent the most attractive opportunity in time and value through the healthcare system. In these matters, our strategy is maximize the value of Baccarat by working with tablets with specific existing relationship with the division maker. Sorry, could we just get you to come a little bit closer to the microphone again? Sorry. Please move to Slide 11. Okay. So thank you. Slide 11, please, where I will now continue with our 2nd compound in chemical development, Oncoroll, and can go directly to the next Slide number 12. Thank you. So the active substance of Oncoral is irinotecan, which is an established chemotherapy with well documented anticancer effects. It's currently used in several solid cancer indications, and it's approved for colorectal cancer and pancreatic cancer. And in Japan, it's also propogastric cancer. Today, the administration is intravenous, bolus infusion, typically every 3rd week and typically high dose. Oncoral is a novel oral formulation of ArenaTecan. It's a tablet for daily dosing that could offer a valuable treatment option for cancer patients in the future tomorrow. And there are several potential advantages of oral daily dosing. Most important, efficacy. It. It's well known that many cancer types have suboptimal treatment outcomes today, and oral daily dosing may improve efficacy through a favorable pharmacokinetic and pharmacodynamic profile based on more constant therapeutic plasma levels of the active substance. And there are both nonclinical and clinical data supporting this concept. And then there is tolerability or safety. Intravenous dosing of chemotherapy is frequently associated with severe side effects, for example, gastrointestinal and hematological side effects. An oral daily dosing has the potential for improved tolerability by avoiding high plasma levels and by offering dosing flexibility. In addition, there's convenience and costs. It's more convenient and cost effective to take a tablet at home than going into have prepared for an intravenous administration. Next slide please, 13. And this is an example of improved outcome, in this case, overall survival with a more frequent dosing. These are for patients with metastatic breast cancer, where overall survival was improved from 20% with dosing every 3rd week, high dose to 32% with weekly dosing with a slightly low dose. This is, if you will, a proof of principle. Next slide, please, 14. So the concept of frequent low dose administration is called metronomic dosing. And the figure to the left illustrates the simulation model comparing levels of the active substance SN38 have after Irenotecan IV dosing every 3rd week, which is the gray line and oral Oncral daily dosing, which is the orange line. An over a 3 week cycle, the exposure or area under curve is comparable, although the plasma peaks associated with toxicity are avoided by daily dosing. Approximately onethree of the side effects observed after intravenous dosing are reported as severe or even life threatening. That's grade 3 or 4. Medronomic dosing may not only reduced peak related toxicity, but they also bring the possibility to digest the dosing quickly in if adverse events should occur. And our own Oncoral Phase 1 results show that Oncoral was well tolerated overall. And importantly, the metrological toxicities for mild to moderate, Grade 1 or Grade 2 only. In addition, our Phase 1 data with oncoral indicated activity or stable disease even in patients that previously progressed on Aruniti can give an intravenous loop. Next slide, please, 15. So this program is supported by a very high profile advisory board. We have Professor Tabanero from Barcelona, Spain, former President of ESMO. We have Professor Adjani from the University of Texas, Professor Van Katzen from Belgium. We have Professor Jeff Evans from University of Glasgow. And here's the joint view that Oncrod will be an important treatment option for cancer patients in the future. To next slide, please, 16. Now we are preparing for Phase II. And the BXtiv or the Phase II study are several. 1st, to establish a clinical proof of concept in metastatic gastric cancer. Gastric cancer is chosen partly because of strategic reasons. There's a potential for orphan drug designation in gastric cancer and the clinical guidelines and clinical data supported efficacy of irinotecan in gastric cancer. Subsequently there is a potential for label expansion into other solid tumor indications. Another objective is to generate COMPAREI Phase II data for development, potentially with a partner. The study is randomized, control multicenter multinational study, compare Oncron to the top standard of care with standard of care on top of Stelaluk Care with Stelaluk Care alone. Primary endpoint is typical for Phase II in oncology progressive free survival and then a battery of secondary endpoints, response rates, PK, safety and overall survival. This will include approximately 100 patients, and we anticipate the study to start second half of twenty twenty one and continue into 2024. Next slide, please. So this slide shows how Oncroll would differentiate from the intravenous products shown in the lower left corner. So their indications are colorectal cancer and pancreatic cancer, although both are also used for gastric cancer in the clinic. For Oncrom, the intended indication is gastric cancer. This is a severe cancer form with a significant unmet need and a significant potential market. As mentioned, gastric cancer is a rare orphan indication, which provides several potential advantages from a drug development perspective. With that, I'd like to hand over to Christian to address the financials. Okay. Thank you, Karl. So the development in earnings compared to the corresponding quarter last year that is on Slide 19. Development is the same as we have seen in recent quarters, I. E. An increase lost year over year reserve is as expected and reflects the increased R and D activity related to primarily the Phase 3 clinical program from Angkor. We now turn to Page 20. So the key message on the liquid position SEES that we have a solid cash balance that was further amplified by the recent capital raise. At the end of the quarter, we had SEK 165 Swedish kroner in the bank. And adding to this is the capital raised with around SEK187 1,000,000 in net proceeds, which was obtained in April, I. E, after the quarter. So consequently, we have a very solid cash position after the fundraise. The cash position will primarily be used for the ongoing clinical program, Mangoral, as well as the launch preparations And also to initiate and finance the On Krog Phase 2, which we expect, as Karl mentioned, late his here. With that, I'll leave the word over to Magnus. Thank you, Christian. And now please turn to Page 21. I'd like to end this quarterly update with our focus for the rest of the year. The clinical development of Mangro is highly important to us. This work continues despite COVID-nineteen impact, and we continue to work with investigators, consultants to make this study a success and are adapting to the circumstances to ensure patients, medical staff, employees and everybody else will stay. We also continue our progress with macro commercialization and have many activities ongoing to enable us to detail and implement the value maximizing strategy. Another important activity is our preparations the Encore Phase II program, which we expect to start in second half of this year. This was our final slide, and we'd be happy to take any questions. Have. Thank you. Have. We have a question from Johan Miros from Redeye. Please go ahead. Your line is open. Good morning. Ioannis from Redeye. Thank you for taking my questions. The first one could be the timing on sparkle. On the slide, you mentioned mentioned that there is potential, of course, potentially some effect of COVID situation. How much room for time slippage is it in the ambition to complete and have the results in the second half of this year. Well, thank you for the question. This is Karl here. Well, the a base plan. And what we're working towards is to finalize the study later this year. And that And then we're taking the COVID situation into consideration, and we're taking all possible measurements to mitigate the effects of COVID. And I think The design of our study is advantageous in that respect because it's a very short study where the patients only come in for 5 days in the study and have And also these are cancer patients that need to come to the hospitals anyway. And then there's also operational things like home care, nurse service and remote visits and things like that. We're taking all that mitigations. And then having said that, we don't know how COVID will develop the for the rest of the year or the second half of this year. We anticipate that there will be some improvement given that the vaccinations are spreading and setting in now. There is no guarantee, but the plan now and the anticipation is that we will finalize the study this year. Am. Thank you. So you will you're in a situation where you will get feedback from the center, I presume? Have. Absolutely. That's a good point. Yes, we are in constant dialogue and contact with those sites almost on a daily basis where we monitor the situation. And the situation differs also from country to country. We're talking about COVID now, Of course. And that's something that we monitor very closely. And also that the guidelines For specific restrictions and so for specific countries and specific sites? Yes. And the interaction with authorities on Oncoroll ahead of the study, what's the status there? So the status for Oncorral is that we are currently not decided exactly how we want to go ahead on that. It's very possible that we will have some indirects. But you have to remember that this is still in Phase II. So the study we are planning now is the Phase II study. It's not the pivotal study. So there's not an end of Phase II or a meeting that you usually have with regulators before prepared the last stage of clinical development, but we will most likely have some kind of interaction. But the specifics there, we have not decided on yet. Okay. Thank you. And on your direct sales a strategy and the ambition to secure about 20 reps. When can that be in place? So the launch preparations will be gradual and then we're looking into the right timing are ramping up in the U. S. Typically, the sales effort comes really towards the end. So typically, you would need the team trained and onboarded when you have approval to balance the risk, but you want to start some things a little earlier. So the most important before launch is to talk to physicians and key opinion leaders and some of the stakeholders who decide on price and reinvestment. But it's the plan is to have it all ready when we launch, trained and ready to go. Yes, we hope so. And finally, if I may, when are you in a positioned to give any more details and feedback on the pricing have. And that aspect, of course, reimbursement will come at a later stage, but perhaps you will have the administration to be more specific about the indication ahead of that. Yes. So a couple of things are needed before prices is public. We also need to see the Phase III results. Even the final label will have an impact. So we now want to be in the best possible situation to talk to these stakeholders. And therefore, it's not in the interest of Asylia to go into details now about the specific price. So as we progress, There will be times where it makes more sense. Yes. Excellent. I think that could be all for me for now. Thank you so much. Yes. Thank you, Johan. Thank you. The next question comes from the line of Stian Westerberg from Agtiv Palana. Have. Good morning. Thank you for taking my questions. 2 of them this time. Firstly, if you could give some more flavor how the COVID situation is Impacting you in the daily procedures, is it simply a tough competition for the MRI devices, which makes the progress difficult or I mean, are the clinicians so occupied by doing things which is mandated by the COVID situation? I mean, if you could give some more flavor, I would appreciate. My second question is if you could update us on your plans For Mangoral, outside the U. S, how do you when do you intend to submit an application to European authorities and how is these how are What are your thoughts about the strategies for commercialization in Europe? Thank you. Okay. Thank you for a very relevant question. I'll take the first one there. So how does COVID impact. Yes. So I mentioned some of this. And it is it's hard to give an answer a general answer. So because it differs from as I said, from country to country and region to region. And in some cases, it's business as usual at some sites, but some are obviously restricted. And that could be not so much the MRI devices that but it's more resources in general. And this could be guidelines and instructions from the hospital management that you should down prioritize clinical research and focus your resources on the clinical care and clinical practice. Another example could be that they are reluctant to bring in study patients that are pure study patients into a study given the risks of contamination or that they've been infected. So they have to prioritize more acute and urgent cases. So that could be one limitation. And another one is obviously travel. And that could be both for patients, but it could also be for us, add from the sponsor from the company that we want to go out and support the sites and it could also be for the ones on the operational teams, for example. But having said that, we've tried to mitigate that with remote visits. And many of these operational procedures are now transformed to online digital meeting and that adoption has gone very well. And as I mentioned, some sites are open now and this fluctuates. We see that over the 1st month of this year or the last month of the previous year where we saw deterioration in many regions, but and where we now see an improvement. And also we have sites in both hemispheres. We have on the Northern Hemisphere. We have countries on sites, but we also have Latin America now. And They're slightly different developments now. But we foresee an improvement, as I mentioned, in line with the vaccines having an effect. Have I hope that answers the question here. Just to summarize, I think we are doing quite well mitigate made the case in these effects, but they are there and we have to work with them. That was the first I hope that was the first question and then there was the second question, which was more on Can you repeat the second? I think it was Timing for Europe? Yes. So at this point, We have not provided any guidance on the specific time lines for Europe. As we have communicated that our strategy to work with a partner. And we think also the submission time lines will also depend a little bit on the optimal time for that. So when timing is right, we will give more guidance on this. Okay. Thank you. I'll get back in line. Have. Thank you. Thank you. Thank you. Have We have no further questions. So I will pass back for any closing comments. Yes. Thank you, everybody, for listening into our Q1 report here of 2021. And as mentioned, we are continuing to make solid progress on our important activities to bring new medicines patients suffering from rare cancer conditions who are in need of better options than they have today. So we look forward to updating you on our further progress as we develop. Thank you.