Status Update

May 22, 2024

Slides

Summary

The strategy resets around a fully funded Phase IIb study of resomelagon in early, active rheumatoid arthritis, with results targeted for end-2025. Partnering and soft-money funding remain priorities for broader pipeline development.

Thank you very much. Thank you for listening in. Jeppe Øvlesen is my name, and I'm the CEO of SynAct Pharma. I'm joined by the founder of the company, Thomas Jonassen, who is the CSO. As Peter alluded to, a lot of things have happened lately, but we are here to tell you today that we are back on track, and we will get back to that. A short disclaimer, we are listed on Nasdaq. Just a very brief outline of the presentation today. First, we'll give you a little bit of an overview on the background of the company, come back to the recent developments, go a little bit into the details of the strategy for 2024-2026, and Thomas will discuss in more detail what we actually do. We are a biotech company. We are located in Lund, but we also have other programs in development. Then we will discuss a bit on the milestones going forward. Very briefly, as a background on the company, Thomas and I, we did another company back in 2000 called Action Pharma, where the lead project was acquired by Abbott. We managed to spin out another project of that company, which created the ground and the foundation for SynAct Pharma back in 2013. We managed to list the company at Spotlight in 2016, and then we started developing our lead asset, AP1189. First, we took the compound into phase I, later on, a year after, in phase II. Then we did a couple of other studies with the same compound in COVID and in a couple of other indications. Then in 2022, we uplisted the company to Nasdaq, and in the year after, we acquired another company which complements our technology, and which have given us access to develop into a broad range of other indications. So basically, 10 years journey, where everything went very much according to plan. We managed to reach a market cap in close to SEK 4 billion in the stock market, and we're in pretty good control and in pretty good development with all our projects. Unfortunately, in September, October last year, we completed a phase IIb study, where we didn't meet the endpoints that we have set out to do. That means basically we didn't get the results that we were hoping for. As you all know, in biotech, then the consequences are pretty big. So we ended up in a situation where we lost a lot of value for our shareholders. Basically, with support from a lot of our shareholders, we had at the time around 20,000 shareholders. We took the initiative that we needed a change, and therefore we focused a lot on recruiting a new board of directors into the company, and we managed to do that successfully in the first quarter of this year. At the same time, we took the decision to raise SEK 50 million, and we did that as a directed issue at a 30% premium. Then we, at the same time, we strengthened our investor base. We have always been very proud to say that we are very retail-driven, and we still have 16,000 shareholders. We are quite proud about that. We have also strengthened the investor base with one bigger shareholder and have quite a few of the older, bigger shareholders becoming even bigger. Then we strengthened our organization with recruiting a CMO to be more involved in the day-to-day running of the study. In the second quarter, we took the decision to reduce management costs with 27%, and we reduced the cost to the board with 46% in order to extend the runway and make sure that we could focus on driving the programs. Then we are basically getting ready to start the next study, which is going to be, again, a phase IIB study. We learned a lot from the first study, so therefore we are very convinced that we can do a better study and that we can receive the results end of next year as we are planning to do. Business development has always been a big focus area for us. As you know, small biotech companies shouldn't bring products to the market in general. We are at least not one of them. The indication that we work with, Thomas will get back to that, is a big one. We need a big pharma partner. I would say that if we have received the data that we were hoping for, we have probably been into an agreement with one of the bigger ones right now. We didn't end up there, but we will, and that's what we are working towards. End of next year, we will try to get a partner to take on the project and drive the marketing. Therefore, we are attending BIO International and we are attending a lot of these events where we keep our partners updated on what we do. Then we have a Capital Market Day planned for September in the autumn. The management team is basically the same. We have added, as I said before, a CMO, Kirsten Harting, with a background from a lot of the bigger pharma companies, bigger biotech companies in Scandinavia. She is definitely adding probably what we need in order to get the right study. We have also, as said before, replaced the board. We have managed to recruit Anders Kronborg, former CFO and CEO of LEO Pharma Pharmaceuticals in Denmark, and also with a background from Genentech in Sweden. Sten Scheibye, former chairman of Novo Nordisk, has joined the board as well. Sten has also a background from very hands-on operational, being the CEO of Coloplast for quite some time. Then Sten Sørensen, CEO of Cereno Scientific, sorry, has joined the board as well, and making up a small but very agile and very efficient board. Basically, the strategy going forward, said in short, is to take the lead program into clinical development phase IIB, and we plan that we will be able to initiate that in Q3. It's a fully funded program, so we are not in a situation where we need to raise more money for that program. Then we have in the pipeline also other projects that we would like to drive that will require more money, but we think that those programs fit quite well for soft money type of funding, an area that we are quite experienced in. In parallel with all this, we will continue the business development activities at a pretty aggressive level in order to secure that there is takers for this project when we hopefully will have positive data end of next year. I will hand over the word to Thomas Jonassen to talk about what we actually do. Thank you. I will very briefly. What we are doing is that we are addressing autoimmune and inflammatory diseases with focus on rheumatoid arthritis, with the aim to intervene early in the disease development to bring the disease to control in the patient, which is very, very important to do as fast as possible. This slide try to explain where we discriminate ourselves from most other companies, as our compounds has a combination of reducing the inflammation without taking the inflammation, reducing to a level, so you increase the risk for infections. At the same time, has this rather unique mechanism of promoting resolution, meaning that we stimulate specific pathways in the inflammatory process and thereby clearing up the inflammation and thereby modulate the inflammation and bringing to a new homeostasis, a new steady-state level. That is what we are intend to continue to develop, and I will try to explain how we will do that. I will skip a few slides to go to this. Rheumatoid arthritis is a very common disease. Here we mention 1% of the global population who is affected. It is a disease that is an increase with regard to incidence, that there is more and more people who are affected of that. Typically, 2 out of 3 are women, and they are typically getting the symptoms in late 40s, 50s. That is a typical patient with affection of joints and also more than joints. It is a reduction in daily living, including inducing fatigue and have uncontrolled and untreated quite dramatic effects for the consequences for the patients. We have a lot of compounds that work in these patients, but most of them are immunosuppressive, so they are associated with side effects, and there is no one treatment for all patients. There is different treatment that fits into different patients, and there is still a lot of possibilities and a lot to know about this and develop further. We believe very much that our compound, given in the right patient population at the right time point, could make a difference. If we look here on this slide here, we highlight that to the right there is a, you could call it a treatment algorithm. It is quite complicated, but the take-home message is, if you have severe rheumatoid arthritis and you are referred to a rheumatologist, you should be treated as fast as possible with today what is standard treatment, a compound called methotrexate. That should work within 3 to 6 months, and if it doesn't work, then you have to go to second-line treatment, which are expensive biologics as TNF blockers. On top of that, to control that, you often need to use a lot of glucocorticoids, which is associated with side effects and really should only be given for a very short period. After all, up to 50% of all patients with rheumatoid arthritis do have more chronic use of these compounds. We believe that if we go in early, as we highlight here up in the blue with resomelagon, which is the new name for 1189. If we go into the right patient population and start treat very early, then we have a very large opportunity to reduce the use of the glucocorticoids and also reduce the potential of the use or at least the time for where you introduce the TNF blockers. We based that on our first data that we got in the BEGIN data that Jeppe referred to, very positive effects, where we went into the exact patient population that we looked into. At that time point, we could only give for a few weeks, but we had clinical significant and very relevant responses already after 4 weeks. Then we continued development, and we were perhaps being too ambitious, and we took in too broad and too many patients and focused on different patient populations in parallel. Unfortunately, that was not the smartest, you could say, we got too many patients into these studies who should never have been included. When we then look at those who actually benefit from the compound, those who have had their diagnosis within 6 months of the disease, 6 months from the diagnosis of the disease, we start treatment, and they have high disease activity, including signs of what is called systemic inflammation, then the compound works very well. We have a response rate of more than 80% on active compared to a little more than 50% on placebo. To the right here, we have the different scoring system highlighting that the compound is highly active, and that is really what you could expect for an effective drug. That is what we are intend to continue in these patients to set up a real phase IIB study with dose range, and so we can prepare this compound for phase III. Importantly, additional information about this is it was also very well-tolerated. We are continuing to set up, and very briefly, a phase IIB study, 3 doses of active versus placebo. We are going to dose for 12 weeks, and here is the timelines we submit here, by the end of June. We start recruiting in September with the first patients, then we recruit for the rest of this year, the whole next year, and then we have the outcome by the end of 2025. Let me just jump to the news flow. We will have the first patient in the ADVANCE in Q3. We call the new study ADVANCE. We will have the Capital Market Day, as Jeppe alluded to. We will continue our discussion with potential partners. We have our small molecule programs that we also have money to prepare for clinical development. In the best case scenario, we will have a new compound that is ready to enter phase I next year. We would have the possibility to continue our work within virus infection, which is very interesting based on what we originally showed in the RESOVIR-1 study. In the second year of next year, we will have pending funding where we believe we have good chance to get soft money. We would have these studies up running and complete our ADVANCE study. I think I will stop here. Thanks for the presentation. If we start with the RA project, what about DMARD-IR and the RESOLVE study? As we understand, the main difference between the previous study and the current study is that you will focus on the treatment-naive rather than a more traditional development with primary focus on DMARD-IR patients. Long question, but can you please explain the difference in the PT population and the overall thought, including market potential of this change in strategy? Yes. At one of the slides I had the blue box and yellow box below. The blue box up at top, that is first treatment line, and that is where you should, according to all treatment guidelines, come in and try to treat and get disease control. If you do not do that, and that is in today approximately 50% of all patients, then you have to go to second-line treatment. That is what is called a DMARD-IR patient. That is, of course, an alternative to do what we are doing. But we know that the TNF blocker is very well integrated into that treatment algorithm and approach. So you really should have something that really could make a difference. Even though you would probably, as some of our key opinion leaders and advisors say, it would be a tough one to take them out. Whereas if you go in fast, you would have the possibility to reduce the use of them, which of course is something very different. We had the ambition to go for both patient populations, and in both cases we recruited too broad. So we got a lot of chronic patients in. One thing we have learned about this compound here is that it works in active, ongoing inflammation. There we can make the difference. Whereas in more chronic cases, we should probably go for something else. Okay. Thanks a lot. Over to the virus infection program. What I understand, you suggest to continue development of resomelagon as a way to protect against hyperinflammation. What are the timelines for the next clinical study, and how do you intend to finance such a study? In terms of financing, we believe that that indication fits really well for soft money application. It is something that we have a fair bit of experience in from the past, and that is a strategy that we continue. The first project, the RA program that is fully funded by now, and we are very happy about that. Of course, with more soft money, we can do more. What we are currently doing is that we are running a pharmacology program with our collaborators that we set up during the COVID, we have called RESOVIR, with Mauro Teixeira in Brazil and Mauro Perretti in London, among others. We are generating data in other relevant virus infection models. Based on that, we can then write up the protocols and go out and find the relevant soft money to do this. Some of these indications are really interesting, not at least as you can associate it to the climate changes with the introduction of a virus that previously had been a problem in third world now coming to Europe and U.S. One example is dengue, where we already this year have several thousand cases in France, and where they actually do whatever they can to protect against the development of that. One question more, short answer. You also mentioned business development in the presentation. What are your next steps? Yeah. Basically, we have made all big pharma and big biotech ready for looking at our project and been into a lot of discussions during 2023. We have hoped that we could do a deal upon the data that we received. Unfortunately, the data was not there. We will continue to work with those. We have done quite a number of deals in the past, and our main aim is to get a deal done on our main project, and then take it from there. Okay. Thanks a lot and good luck. Great. Thank you very much. Thank you.