In today's broadcast with research company, iLab, focusing on the Parkinson's disease, we will get a presentation of the Q2 of 2024, followed by Q and A with equity analysts covering the company. Viewers can ask their questions in the live chat and I will raise as many of them as I can. With that, I greet CEO, Gunnar Olsson Executive Vice President, Research and Development, Niklas Waters and CFO, Victor Sievech. Gunnar, before we start, what is your overall impression of the Q2?
We've had a great second quarter with several very good advances in our portfolio. So it is a pleasure for me to be here with the team to present the 2nd quarter outcomes to you. If we go to the slide here and if we take the next 1 and the next 1. So today's agenda, I will give you the highlights and news in the period. And this would be followed by Nicolas Water to give us an update on the R and D progress.
Victor Sivet will then take on and give an update on the financials. And I would come back to give some concluding words before we open up the Q and A session. So, next slide, please. The positive development in the beginning of the year has continued in the Q2, as I mentioned, and we've had several important advances. Here, 4 of the key highlights for the quarter.
With 757, we entered clinical studies. The first Phase 1 study was initiated and this is the study that is funded by the Michael J. Fox Foundation Grant. And that means that we now have 3 compounds in clinical testing in IR Lab. We came into a collaboration agreement with MSRD, a company in the Otsuka Group.
And that means that we are now aiming to take this compound all the way through to clinical proof of concept. And this means that this compound is now fully financed all the way through clinical proof of concept. For pyritinab, we have the DSMB for the REACT PD study that is our Phase 2b study. We have the second or the DSMB have their second and final review to look for data integrity and safety in the study and the unanimous response and recommendation to us in the company that is to just continue the study to completion. So that is very positive.
And finally, on this slide, the Board appointed Kristina Torfgaard as a new CEO for IR Lab and we are welcoming Kristina in her new role 1st August this year. Next slide, please. Some words about the development collaboration with MSRD and Otsuka. The scope of this agreement that is to take 757 all the way through clinical proof of concept for the treatment of apathy in 2 populations, individuals with Parkinson and individuals with Alzheimer's disease. And secondly, this, as I mentioned, it secures all financing through clinical proof of concept for this compound.
For IR Lab, this means that we have received an upfront payment on US3 $1, 000, 000 and there are activity based milestones of $5, 500, 000 IRLA will execute all the development activities and IRLA will also retain the ownership and all IP rights to the product. For MSRD, in addition to paying upfront the milestones, they are also covering all costs to take the compound to clinical proof of concept. MSRD may extend this collaboration beyond proof of concept, but then there is a need to have new negotiations and new deal. And in the event that MSRD decides not to extend the collaboration, but then they are entitled to the low single digit royalty on future sales of the product. Next slide, please.
This deal brings many positive bids to IRILAB. It brings us cash flow $8, 500, 000 in the near term. As I mentioned, it secures all the funding to take or financing to take this compound into clinical proof of concept in 2 different populations. And it of course, provides additional external validation of what we're doing and the science that we are driving. And of course it particularly also points out the potential of 757 in apathy.
We have never communicated the total value of this still, but just to give you as a benchmark to take a compound into Phase 1 and all the way up to a clinical proof of concept. That is estimated in this industry of circa USD 25, 000, 000. Next please. I'll give you a very brief summary of the progresses in the projects. For Maestoppertan, we are continuing preparation for a Phase 3 start and we are doing activities that are supporting our business development activities.
For Pirapnet, as I mentioned, we had the DSMB for the REGPD study giving unanimous support to complete to continue without changes and just complete the study and get the readout. 757, we entered clinical testing and we have started up the collaboration with MSRD Otsuka. And for our preclinical compounds 942 and 11 17. Our preclinical projects, they are continuing according to plan. Nikolas will come back and give you more details on the R and D side of what's happening in the projects, but this is the top line summary.
Next slide, please. Financial aspects in the quarter. We have now received the upfront payment from MSRD Otsuka, USD 3, 000, 000. We took a decision to draw SEK 25, 000, 000 from the loan facility provided by Fenia Capital in last December. And we have now full financing of the 757 compound development all the way to and through clinical proof of concept.
The financial position that we have today, that is such that we now will be able to drive through next year value driving milestones. And that is the next optum partnering for Phase 3. And it is bringing Pirukinat Phase 2b, the REHACT PD study, all the way to completion and report top line results. Next slide. As a way of bringing more information of our projects out, we are participating and presenting at investor meetings.
We've done so also the Q2 and here on this slide you see listed where we participate during the Q2. So with this, I think it's time now to bring Nikolas to the stage and give you more details about all the progression that we've seen in the pipeline. Please, Nikolas.
Thank you very much, Konur. And I'll give you a brief update on the status of our programs. And as you all remember, we have built a pipeline over the past few years addressing all the different stages of Parkinson's disease and the unmet needs in the disorder. Next. So with mestopetam, which is our most advanced compound ready for Phase III now, we have a drug which treats dyskinesia, which is a huge issue, and there is very poor treatment options today on the market.
This is a drug which also has the potential to treat psychosis. So there is ample opportunity for expansion of the indications going forward. Next, please. Pirivimat, it's a pioneering drug, which has the potential to treat falls in Parkinson, which is 1 of the biggest problems,
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of the most costly problems for payers around the world in terms of the direct cost for the disorder and also for the problems and also the cost for the patient that falls. Next, please. 757, addressing apathy, I'll come back to that. I'm going to talk a little bit about it. But this is the 3rd compound we've now brought into clinical trials, a quite impressive achievement of a small organization like ours to actually be able to push forward 3 programs at the same time.
Next, 942 representing an area which is poorly treated in Parkinson disease, and that is the cognitive aspects of Parkinson's disorder. Next. And then last but not least, 11/17, which has the potential to become a mainstay treatment for Parkinson's, the motor symptoms, basic symptoms, all the way from the first diagnosis of PD through the disorder in full. Very interesting program as such. Next, please.
We'll go to Mestopper Tam and talk a little bit about the most recent progress. Next, please. This is a 1st in class compound acting as a D3 receptor antagonist. This is the 1st D3 receptor antagonist that is actually proven to have efficacy in leads in Parkinson disease. There's lots of data out there in the literature suggesting the D3 receptor as an important player in the genesis of dyskinesias, not only in Parkinson's disease, but also in other types of neurological disorders.
We have built a patent portfolio, which we are expanding at present. We expect to have patent exclusivity or the potential to have a patent exclusivity into the 40s. So that's a very long period, very fresh patterns. Mentioning the 1st in class and mentioning the mechanism here is an important aspect of the program from a commercial perspective. Those responsible for actually paying for drillments across the globe, that's in some societies, it's the governments and in some societies, there are insurance companies paying.
But they are extremely focusing on novel mechanisms, novel mechanisms that can treat the disorder in a new way. So therefore, this adds value to the program. Next, please. The progress during the past 3 months has been steady, as Conor implicated. We have we are right now in preparation for discussions with European authorities.
If you all recall that we had a very successful meeting with the FDA concerning the plans that we have for Phase 3, full acceptance of our strategy. But here we also want to have some input from European countries and the EMEA, of course, at the end of the day, so that we can actually adapt if there are specific aspects that are necessary to do from their perspective. We're also looking at market research activities. I mentioned that briefly before, but we are looking at how to best position West Opperta in today's treatment algorithm. And we have collected information from payers and from paying organizations, experts around the world, helping us to actually shape the final writings of the protocols for the Phase 3 program.
Then we have the possibility to actually start this program at the end of the year or early 'twenty 5. It's not very smart to start a study in Christmas times. But in principle, we could start at the end of the year or the turn of the year. There has been some external validation of our internal research on the preclinical side as come a publication indicating that the efficacy that we have detected in our assays and in our models actually is corroborated by studies done by others. And in addition, the scientists actually discovered that there is a reestablishment of synaptic connections so neuronal connections in the brain after treatment with mastopidom.
This is a kind of an indication that there could be disease modifying properties involved in the treatment effect of mestopetone. This is something we will follow closely over the coming years. Next, Pirpemat. Next, please. We have an ongoing randomized study, as you all know, collecting data on falls.
Falls is 1 of the biggest problems, as I said. We have high costs and lots of suffering in the Parkinson's operation due to falling. About half of all patients with PD, the diagnosis falls actually recurrently. So the status of this study is that we're running it across European countries right now. We have communicated that we will complete the recruitment in Q3 this year, which means that after the 1 month run-in period where we collect baseline data and then the 3 months randomized treatment period, Then we have the follow-up meetings and then we have the database lock.
After that, we can report data. We expect to be able to do that within Q1 next year. Next, please. This is also a 1st in class compound, novel mechanism with a novel stem name by WHO. I've said that a number of times, but these are really important pieces in the puzzle of building the commercial value of the compound or the program.
Next, please. So as Gunnar mentioned, we had the final pre specified meeting or not we, but the Drug Safety and Monitoring Board, which is a vehicle responsible for monitoring safety and the data integrity in any clinical trial. And in this case, they did their last pre specified assessment of the study, and they advised us to continue as is, which is very good news for the trial. Next, please. Next.
Yes, sorry, you go back 1. As I said, we will complete the study in Q3 in terms of randomization, which means that we will be able possibly able to deliver data in Q1 next year. So the 7, 757 program, our 3rd program entering into clinical trials, addressing apathy. And this is, as Gunnar explained, a program which is fully financed. We have prominent collaborators on board, both Michael J.
Fox Foundation and MSR De Otsuka, supporting the program fully, financially. And apathy represents today a huge unmet medical need in Parkinson's disease and other neurological disorders. And that's why we are together with MSR, DSOK, building a strategy for both Parkinson's and possibly Alzheimer's disease or actually Alzheimer's disease. Next, please. This drug has the potential like mestopetam and pyridmat to be the 1st drug in a new class to actually treat apathy.
We have received regulatory approval during the quarter to start Phase 1. We have started the Phase 1 study. We had a record breaking time lag between approval and start actually. We're proud of that. So we started Phase 1 a couple of weeks after the approval.
We have, as Nemes mentioned, full funding for the program. And the joint steering committee that we have set together with MSRD is now operative, and we are working together to build the protocols for the coming studies. So a very successful start of both the study and the collaboration with MSRT. Next, please. The preclinical programs are running as we have discussed.
Next, please, we'll go to 942 first, where we have a huge problem for Parkinson patients is the cognitive decline that occurs during the course of the disease. And there is a huge population out there with this problem. We estimate that around 5, 800, 000 patients that are addressable. Similarly, for 11/17, we have around 5, 700, 000 patients who could benefit from a drug which treats the hallmark symptoms of Parkinson disease without the complications. Next, please.
The cognitive issues are huge in Parkinson disease, about 25% to 30% actually have severe forms of dementia. And but then also another 25% to 30% have what's called MCI or mild cognitive impairment. And these are difficult to treat today. There is 1 approved drug to treat these symptoms, but it has also a lot of side effects. So here we have an opportunity actually to provide something that could help these patients much better.
Next, please. With the program development during H1, Q2, we have developed additional data or generated additional data on cognitive aspects of the drug improvements. We have started the complex CMC work that is needed, and that is the GMP manufacturing of the drug. And we have also initiated the production of drug product for Phase 1 studies. So next step will be the talk studies when we have the API for those.
And the start of those studies is, of course, dependent on availability at CROs. Next, please. For 11/17, which is a novel strategy to provide a once daily treatment for Parkinson disease without the complications that are well known for levodopa. And here we have just a graph showing the 24 hour actually, this is 10 hours, but the sustained efficacy efficacy over 24 hours after 1 dose of the drug. It hasn't been seen before with any other type of Parkinson treatment, this longevity of efficacy.
Next, please. So here we have run through 11/17 through a number of very important and predictive models of Parkinson's symptoms. We know that we can treat over a long time period. We know that we can switch from levodopa to 11/17 without complications. We know that 11/17 in chronic treatment does not generate the complications with fluctuations as you see with levodopa.
We have full accountability for the TMPK, the drug distribution in the broad body and in the brain. And we know which doses we would go for in talk studies and also in clinical trials. So right now, we are in the process of developing the synthesis of the drug product. And this is a highly potent compound. So we won't need very much drug over the years.
We have calculated that for a lifetime treatment with this drug, this potential drug around 4 grams would be enough a fun fact. And also, we have recently filed patents around this, both active patents covering the invention, but then also patents that defending the core scope of the invention. Next please. I will turn over to Victor and let him go through the financial aspects of the recent period.
Thank you, Nicolas. And we can go to the next slide. This is the slide that we have shown before and it's important because it shows the value creation that we've been able to find in the 757 project, where the green line in the graph represents the likelihood of a project going to launch to be marketed and get sales on the market. So it also represents the value, of course, of a project. So with 757, we get funding from Michael J.
Fox Foundation for the first Phase 1 studies and then from MSRD through clinical approval of concept. So this will take 757 a long way along the green line without IR Lab having to pay anything for it because all costs are covered by our partners in this project. So it is truly a great deal for IR Lab and our shareholders. Next, please. So the numbers for the quarter.
Cash position above NOK 98, 000, 000. And the most important thing in this slide is probably the graph in the middle where we can see that the costs have increased quite dramatically from a bit more than NOK 30, 000, 000 to almost NOK 50, 000, 000 during the quarter. But you can also see that a lot of it or basically all of it is in the lightest green shade, which means that this is cost that is covered by our partners in the 757 project. So for Aerlab and our finances are not impacted, so to speak, by the light gray shade, but only by the other a bit more than NOK 30, 000, 000 during the quarter. So that's the most important thing to show on this graph.
Can also see that the number of employees is quite stable at around 30 people. And of course, a lot of the cost that we actually do carry ourselves is due to continuing the Phase 2b study with PirapMART and also the preclinical programs that we run. Mstopperdam also, of course, takes some cost to do all the preparations for Phase 3. This is just showing the net sales, which is, of course, affected by the $3, 000, 000 up front that we got from MSRD for 757. And also, that is a bit more than NOK 30, 000, 000.
The difference, about SEK 10, 000, 000 is a result of the fact that we get payments or if we take we recognize the payments from our partners, we recognize that as income when we have costs that they will cover. So during the quarter, we had about NOK 10, 000, 000 in cost for NOK 757, 000, 000, which is reflected in the net sales as well. So those SEK 10, 000, 000 are both in sales and in the cost. Yes, think that I will leave it to Gunnar to conclude the presentation.
Thank you, Victor. If we take the next slide, please. So, some concluding words from me. Next slide. I will start with this portfolio slide.
And I want to highlight once more that this portfolio has been built over some years now with the unique discovery platform ISP. And it is a portfolio of true first in class drugs aimed to treat symptoms and complications in Parkinson and other degenerative diseases that are presently not really available for treatment. So, it is really aiming to go for very large unmet medical lids. And of course, this also gives the potential of this project for the future. Next slide please.
I return to the key highlights and I repeat it, it is 757 into Phase 1, meaning that we now as a small company, we have 3 clinical projects. The collaboration with MSRD, Utsuka, meaning that we have full coverage of the costs to take this compound all the way through clinical proof of concept. The Piritmat study now having paused the 2nd and last pre specified DSMB review with regard to data integrity and safety. And that is very good news because that means that we could continue our timelines for the study, they are even more solid. And lastly, the Board has appointed Kristina Thorfgaard to come into the company 1st August.
Next. I want also to give some words on all our activities in business development. We have since almost 1 year now have an intensive activity ongoing in this field. And we do definitely see that many companies around the world is now more aware of IR Lab as a company, our portfolio and our individual projects. And that is of course very good news.
We do this by continuous and frequent interaction with potential partners. We are discussing partnership across the portfolio, but be sure for the time being, we have a very strong focus on driving activities around Nestor Petain. Next slide, please. So, we've talked a lot about Q2. Now, let's look forward.
Over the next 12 to 18 months, we see multiple possibilities for high value creation by progressing the portfolio. So, the key things to keep an eye on that is really messed up the time are building activities come to hopefully coming to fruition and start of the Phase III program. For pyridinab to complete the ongoing REACT study in force and get the top line results and get started with business development activities to prepare for Phase 3 funding. 757 complete the ongoing Phase 1 study and initiate the 1st patient study to look for efficacy and safety signals. And for our preclinical compounds 942 and 1117 to progress so that we have them in clinical phase, running Phase 1 studies.
Next slide, please. So, ERlab, we are building on pioneering biology and we have our unique discovery platform, the ISP, creating 1st in class drugs or compounds to build drugs, I should say. We have a focused strategy and a valid business model. We have proven that we can discover new molecules, take them into development, get into clinical proof of concept and do deals. We have a broad and solid portfolio and we are an organization positioned for success.
So with this, I think that we are now moving over to the Q and A session. So, over to you.
Thank you so much. Very inspiring listening to your progress. And if I start off the Q and A with asking you, Gunnar, why is Cristina Tolfgaard the person to take over where you are now?
She has a long experience in large pharma and in small biotech. She has worked from preclinical activities all the way up to with marketed products. She has been part of driving regulatory discussions partnering. I think that she will fit very well into the team here. And really the team spirit of the company, that is really what we want to keep because that's really what's driving the very good progress that we've seen over the last year.
Thank you. And if I understand it correctly, you will stay active in the board?
I will continue on the board to supporting the team here as well as Kristina as we move forward, because we have a very exciting position now with this portfolio of highly innovative drugs where we start to see very good clinical data coming out.
Okay. Thank you. And by that, I will hand over to the 1st equity analyst, and that is Alexander Kremer at Abergheia Sundal Collier. Please go ahead with your questions, Alexander.
So good morning, everyone. I have 2 questions. To start off with the first question, you said that you do most of the market research. Will you be able to share insights from this market research at some point this year?
We can only give you top line here because always when it comes to marketing strategy information, Any company has a strictly confidential bid. But I can tell you that from showing the TPPs for MRTPETAN, there is a very positive response from organizations in both Europe and U. S. So our interpretation of the activities is very positive.
Okay. Very nice. And my second question relates to IRL 757. In your report today, you mentioned that you have invoiced costs related to the 757 program to MSRD. And my question here would be like what kind of costs does this cover beyond the costs that are already covered by the Michael J.
Fox Foundation?
Well, actually, the first ongoing study that is fully funded by Michael J. Fox Foundation. All the costs that we are invoicing to MSRD, that is cost for things that will happen after the first Phase 1 study. But it is so that when you drive development, you need always to be 1 or 2 steps ahead in the planning of activities. And that means that you are signing up with CROs, you're asking for production of new material, etcetera, etcetera.
And that happens months before the activity actually takes place. And of course, in order to get that going, you need to come with upfront payments to the CROs that you're going to work with. And all those type of costs, we are invoicing to MSRD. And that's why we see that money comes in even if we haven't started the next step activities following the Phase 1 study.
Okay, great. Thank you. That's from my side.
Thank you, Alexander Kramer, ABG Sundal Collier. And let's move on to Edison Group and Equitonealist Sue Romanov. Please go ahead.
Good morning. Thank you for taking my questions. First for IRL757, I think it's interesting that you're working on apathy in Alzheimer's and I kind of wanted to talk about the synergies or challenges you'd see in evaluating this patient population along with Parkinson's since that's your traditional focus? And obviously it's a great time to be looking at Alzheimer's in general?
I think that this is something that is extremely positive. We know that apathy very many different diseases or individuals with different diseases, while the etiology may be different. Based on our preclinical studies, we believe that we will have a good effect in very many different types of diseases where apathy is a key symptom. But you really can't know until you've done the test. And that's why it's so positive that we already in the initial testing in man now can do this in 2 parallel populations.
But of course, depending on the data and how the effect of the drug looks, we will need to make potential choices. If we have good effects in both indications, we might see a parallel program for the 2 different populations. If it is so that 1 of the populations have a much stronger response than the other, Maybe that is then the 1 to focus for the initial registration program. But the key thing that is that it's very positive that we can do this in parallel. So we don't lose time by doing this sequential.
So it's very good for us.
Yeah. No, that sounds interesting. So also congratulations on the safety review for the Phase 2b purpumab. Should the results be supportive? Do you expect to take further the Phase 3 development work immediately?
Or would you need to foster more partnerships?
Well, this is the beauty of the small company with a large portfolio. Things are happening all the time, meaning that we need to be very agile and nimble in our decision making and we need to be very fast in how we support things. As I stated in my presentation, we will of course initiate some BD activities. But depending on what's happening with Mestopetan and partnering, we might be in a position where we will do things differently from what we foresee today. Meaning that if we have a good partnership with Investopetom, it may be so that we have funding to do more in house.
But since we don't have that partnership here and now, we need to plan very broadly and that's why we today state that, of course, when we have the data from PeriodMed, we will also do some business development. But as a small company, we are very flexible and we evaluate our position all the time as we move forward.
No, that's great. 1 quick question, sorry to take have so many. It was really nice to see the revenues, the 42, 800, 000 and then obviously the 3, 000, 000 upfront from MSRD for IRL 757. Could we talk a little bit about, you know, the makeup and then the cadence going forward?
I invite Victor. I think he's the best person to give
you. Thank you. We'll save a question. So the cadence of the payments. Well, as you've seen in the report, we've invoiced about a little bit more than SEK 50, 000, 000.
That will cover the next steps beyond the SADMAT study. And all, as Kjell alluded to, the preparations like the talk studies and the CMC programs and so on, that is needed to take the program further. So I would assume that the activities that this money will cover will take roughly a year.
Okay. Equally, yes.
Yes. Roughly.
Yes. Great. Thank you so much.
Yes. Just to find a comment to do what you said. I just want to highlight here and of course you've all already said that, but this is important for us and for our shareholders because this is non diluting funding.
Okay. Thank you, Sue Romanoff of Edison Group. And let's move on to Frederic Tuur at Red Eye. Please go ahead with your questions.
Yes. Hello and thank you. In the report, it was mentioned that for the pivotal trials with must hope Tom you wanted to do 2 small trials rather than 1 larger trial. Could you elaborate if this is your choice or is it like a regulatory requirement or yes?
Yes, this is our choice. We have the opportunity to do 1 or 2 studies. But to reduce the risk in terms of approvability, we think it's prudent to do 2 studies, which is the common way forward. However, this does not change the time line. This has not changed the investment.
This has not changed anything in terms of the operations, just the fact that we have 2 different studies,
but
they go in parallel. And also in parallel with those, we also collect open label extension data during the same period. So this does not have any impact on the timelines or the costs of the trials. And frankly, not on the operational aspects of it either. So this is a decision we've made based on reducing risk at the end of the day.
If we come with 1 trial, it may fly. If we come with 2 trials, it has a larger chance of flying because that is the regular way of doing things to parallel trials.
And operationally, I mean, how does it differ with 1 or 2 trials? Is it different centers or what is the
If we do 1 trial, we will have X number of sites. If we do 2 trials, we will have X number of sites, but with different global types on the trial. So it's the same operational workload. Yes.
Okay. And in terms of the powering for this trial, can you say anything about that? I assume, of course, that it's good.
Each of these trials will be, of course, properly powered for the primary endpoint and also a couple of secondaries. That is what we have set out to do. And of course, we are working on these statistical analysis plans for these trials to make sure that we actually achieve the goals that we've set.
And let me just add here. Remember and couple this now to the Phase 2b study that we have reported. In that trial, the placebo and the 7.5 milligram dose arm, they were 30 plus 30 patients in our study to come, I mean the 2, we will have roughly 70 ish plus per arm, meaning that we will actually have much stronger statistical power in the Phase 3 study than what we had in the Phase IIb study. So, we are pretty comfortable here and confident that if we repeat in the Phase III studies exactly what we did in Phase IIb and we have a larger population, we are pretty confident that we will get the P values we need.
Sounds reasonable. And maybe a final question. You mentioned in your you have ongoing discussions, of course, regarding out licensing of Mastopetan. Could you say anything about the interest in psychosis? And how important is that for you when you evaluate different options and all?
There is an interest in psychosis, although we see it as well as those that we are discussing with, we see it as the next first line extension. It is something that is of course differentiating even further from Amantadin. Amantadine as you know driving both psychosis and force. Here with mestopetum, if anything, we are taking away psychosis. So, a key differentiator.
But as we see it now, it is the 2nd wave rather than do it in parallel. I should though be a little bit careful here because depending on partner, a partner could of course want to drive things more in parallel, But we, as a small company, will need to take 1 Phase 3 program at a time.
Yeah, perfect. That's all for me.
Tour at Redeye. And I actually have a question from the viewers. Would you say that the business development progress related to Mastopetan is according to plan?
It is, yes.
Okay. That was a straightforward answer. And thank you, Gunnar, Nicolas and Victor for your presentation and all your answers. Thank you.
Thank you very much.
And that sums up today's broadcast of the IR Lab Therapeutics presentation and Q and A for the Q2 of 2024. Thank you for watching.