Collaboration Agreement

May 4, 2021

This is Karl Johndal Sklarj from Vicor Pharma. Welcome everyone to this webinar following collaboration between Lyco Pharma and Allied Therapeutics to develop new prescription digital therapies for patients with IPF. I will be joined today by Jessica Schall, who we recently recruited to head up the digital therapeutic program and she brings more than 20 years experience in the development and adoption of digital healthcare technologies and has provided expertise on digital health best practice and policies for WHO and the Digital Therapeutics Alliance. So we're very pleased with that recruitment and she will also be part of this webinar. I will also be joined by Jan Fernand de Drakenberg, the Founder and CEO of Alex Therapeutics, who will share the insights to what these devices actually can bring about for us. And if I have the next slide, please. So this is a true collaboration between Vicor Pharma and Alex Therapeutics. Bicor, of course, as an expert in IPF, in pulmonary pharmacology and medicine, together then with the development expertise in digital therapeutics, artificial intelligence and psychology coming from Alex Therapeutics. We will then embark on a joint development to developed cognitive behavioral therapy for these patients. There is certainly a need for treatments beyond the drug and there's certainly need to focus beyond the lung volume and fibroblasts and the technical of the disease. And CBT, the cognitive behavior therapy, well established therapy for the mental aspect, the mental health conditions that comes along with such a severe disease as IPF. The terms that we have announced is that ARRX receives a little bit more than SEK 8,000,000 upfront, and then we have undisclosed milestones and royalties on the sales in the future. And Baikor will remain the owner and walk right to the product, BB04. And as I said, we have now appointed Jessica Schall as Head of Digital Therapeutics. And of course, she will be the 3rd leg of this development and be working in between and making sure that the development from Alex Therapeutics and the input from us will result in products that also would reach the patients and the market. Can I have the next slide, please? So this is, I think, very much a natural continuation of the portfolio that we are developing for IPF patients. And we've always been saying that Bicorp Pharma is a rare disease company focusing on patients with rare disease and rare lung disorders, not only the disorders themselves. And I think this is another evidence for that. BP-one program is the Phase 2 proof of concept for IPF that's aiming to reduce or even if possible stock of fibrotic development with C21, our 1st in class compound for the angiotensin type 2 receptor. Recruitment is ongoing and still keeping the schedule despite some difficulties due to COVID-nineteen. So far, we have no safety concerns, meaning especially GI, which has been really a setback for both the products that are on the market, but also for some of the competitors that are doing studies with in Phase 2 and Phase 3. So, So far, we haven't seen that with our compound, which is of course a great benefit. The EP-two program is an inhaled, immune to treat the IPF related cough. And COVID is the symptom that has the greatest impact on quality of life for these patients. And this is of course also in line with the concerning about the patient and making life more bearable to them. We are there in Phase where we're doing the GMP synthesis, we're planning for Phase 1 in the beginning of next year. Also, we have a follow on program with new molecules addressing the same receptor, the antitensin type 2 receptor. That's for ILD for interstitial lung diseases and also for other broader indications. And so those three programs together will now be complemented by the development of the digital cognitive behavioral therapy in collaboration with Alex. Can I have the next slide please? So why is digital therapy and cognitive therapy needed for IPF? I think If we put ourselves in illusions of a patient who has been coughing and short of having a little bit short of breath during the last year, a 6 year old man You suddenly get the diagnosis or finally get the diagnosis that it is idiopathic pulmonary fibrosis. That is a best sentence in itself. We have 3 to 5 years life expectancy. There are drugs available. They reduce the speed by which you deteriorate, but they had a poor tolerability and especially on the GI side. So these patients will from that day on never feel any improvement in his condition. We will just deteriorate a bit slower if he was taking the drug, but to the price of the side effect profile of course. We will have daily reminders of the symptoms and the limitations of its life, frequent relapses or infrequent relapses, but still moving to the next phase of the disease. And it's also social distancing from friends and family, maybe due to having a terminal disease. So Apart from the physical symptoms that he experienced, there's a lot of burden on its mental health as well of course. And Michael will here provide an integrated care solution for these patients, develop a product that aim to relief, the associated anxiety, depression. It's not only by appointment, but actually 20 fourseven. So when needed, it's there. It's all about behavior changes, handling the situation, void, the mental anguish, to structure date, to learn about the conditions, abilities, to find the balance in activities and recovery and to live with disease with the highest quality possible. So that's what the ambition is. And if we have the next slide, I'll be happy to introduce Jan Renan de Dakenberg to go through what the product will a little bit look like. So you will get a feel for that. Please, John. All right. Thank you, Karl Johan. So we are at the early conflict phase, And I will give you sort of a just an overview of the different concepts that will be brought into this product. And you can see a few pictures in In the lower section on the slide here to get an idea and feel for what it could look like in the future. But this is the mission really is to improve the lives of these patients. And we will develop a fully autonomous and stand alone digital therapeutics and can be prescribed by doctors to patients and focus on the mental health conditions of these patients, for example, anxiety and depression. So the product will be Certified and registered as a C Class Medical Device. So that means that we are developing this product under the medical device regulation MDR in the EU as well as under FDA in the U. S. So it's a rigorous development process that we have to go through to ensure that we have the highest possible standards for safety, for protection of data, for instance, and also for quality overall. So to this, we have an AI engine and That AI engine will be delivering the personalized aspect of this treatment, so there will be no psychologists involved in the treatment. There is an AI engine who will Personalize the aspects of the treatment. And it's built on evidence based cognitive behavioral therapy, which has decades of evidence behind it. And one of the important parts of this kind of treatment is that the support is continuous. So it's 20 fourseven support all year round and we can maintain the positive effects of this CBT treatment over a large period of time. So very excited about this. And I'll leave it over to the next slide. Thank you. Thank you. I think this is my slide. This is Jessica Schall, The new Head of Digital Therapeutics for Vicor. And what I'd like to explain here is that digital therapeutics are In fact, medical devices, they are regulated under, as John mentioned, under MDR and require a CE as a medical device in Europe. We can say that there are 300,000 health and wellness apps out there, But these are not in that realm. There are about 200, 250 products which actually qualify as a digital therapeutic because It's not just what the patient sees on their phone. It's also about the clinical evidence required to actually create an interaction that moves the clinical endpoint. So these products have to go through regulatory channels through CE marking as well as FDA approval to prove their safety, first of all, but also reliability, everything that John mentioned about data Cybersecurity, all of that, plus clinical efficacy. So, that will of course require a clinical trial And more parts to providing evidence. So in general, the industry has been around for more than 10 years and there's a growing base of evidence for the effectiveness of these kinds of products. And these products have been developed for all kinds of conditions. Psychology and mental health is 1, but also for circulatory diseases, for neurology, pain management Respiratory disease, there are products on the market currently being used in countries in Europe and U. S. For COPD and asthma. Endocrinology as well. There are many products for both Type 1 and Type 2 diabetes and oncology for Not the cancer itself, but the sort of psychological aspects and the Attention and well-being of patients who are going through cancer treatment. And there are probably 15 more examples to give like of these areas, but this is a short list. Can we have the next slide, please? So, this is an example a list of examples of DTX Digital Therapeutics partnerships, which are currently ongoing. And this is these are large pharma companies, big pharma, which They have partnered with digital therapeutics companies to provide a product to their patients. So, Sanofi and HAPA PI are developing something for multiple sclerosis. Pfizer and our Alex Therapeutics has A production line for a product addressing nicotine addiction. And so there are several products here and you can see that Otsuka and Click are doing major depressive disorder. And so this is, of course, Mental health in the area that we're speaking about. So, these do exist. They are in use. They're in progress. And in the U. S, Business Insider has estimated that BPX Industry to be worth $56,000,000,000 within the next 5 years. So the Momentum for this is only growing larger. DTX products are priced as medical products. They are not free products that you download. This is they are medical products. And they are often described as companion products to a drug therapy. They can also be used as standalone treatment or as a companion with another device. But, the modalities are yes, there are a few analogies that are currently in use. And for the next slide. So this is the PPO4 path to market in a sense that There will be of course a design and development phase. We will have to engage with patients, physicians and healthcare systems to know What will work for patients, how physicians will be interacting with this product, and health care systems We can incorporate, and of course pay for this product. So, the DTX features and interface We'll have to meet all the standards, regulations to comply with software and medical device, SAMDI regulations according to IMDRF. The design and approval phase will begin for the clinical trial will begin in 2022. That trial will, of course, be run and the results published in a peer reviewed journal. Certification as a medical device, so this the CE marking, once you are certified as a medical device through the notified bodies, through this A very structured system within the EU, this certifies the product for sale in every EU country. So this opens an over the counter Pathway in 27 markets and it's not given that patients will face this out of pocket, but that is one possible pathway And products in general, like any digital therapeutic has that option. So, the Reimbursement pathways also exist like through national reimbursement. So, when that part of the plan is launched, there There will also be real world data gathered as the products are in use. And this is the most, I suppose Innovative part of the digital therapeutic is that it's not just a pill that you give and sort of forget about. You know every day afterward what the patient is doing, how they're engaging, what's Effective where improvements need to be made and it's a constant indication of efficacy and is actually required as part of the medical device regulation for a class 2A or 2B product. And in many countries, the final point there is that price negotiation After 1 year of use, for instance, in Germany, this can be detailed and they look nationally to see what the actual effect was and The final question negotiations are based on that. So I will pass now back to Karl Johan. And thank you very much. Thank you, Jessica, for this introduction to our product and to digital health. I'll just flip to the next slide please and try to explain what the value of DTX is for bicor. And we certainly believe that this product development can part of it, there's a paradigm shift where we're looking to in the way we engage, support and collaborate with patient communities and health care systems. And this is especially through in the rare disease arena where patient communities are strong and where this is a way the way of working together. So it kind of formalizes and extends the value of what Baikol is already doing and we're building a patient facing product together. So the benefits of this addition to a revenue stream is, of course, that we will get patient familiarity, trust and backing engagement with KOLs, physicians and patients and families. And as Jessica I pointed out, we will learn to evolve product through the understanding of the disease from each and every individual patient. So as kind of final remarks for this presentation, I think it's worthwhile saying that again, iterating patients with IPF are suffering from much more than shortness of breath and the reduced lung volume. And with DP04, the digital therapeutic, we aim to address the mental health issues that are part of IPF, inherited part of a severe disease. And when we did our patient interviews, when preparing and discussing this some time ago, I still remember one of the interviews, where the woman at the end of the interview said, when can I have this? And I think that kind of prompted us to move on and we're very happy to announce it. Starting of this endeavor together with Alex. And I open up for questions. And our first question comes from Frederic Thule from Redeye. Please go ahead. Your line is now open. Hi, thank you for taking my question. I was just wondering if you could elaborate a bit more about the experience of CBT in IPS patients today. Yes, there's a lot of experience in CBT, not so much specifically for IPF patients, But in related diseases, in lung disorders and including COPD, also including IPF, there is no digital therapy development in IPF. And I think it's also known that for these patient categories with more intense CBT works better than not so intense. And of course, with the digital approach, you will have a 20 fourseven access and you will also have the opportunity then to adjust in a much more fine tuned way based on the artificial intelligence. So there's certainly evidence for CBT in all the mental health components of IPFs. And we're convinced that risk will be true for these patients in our studies as well. And also with this in mind that it's relatively new Part Bs patients, How sale will it be specifically for Vicor? And yes, how different will it be from the other projects in Alkak Statistics? Analysis. It's completely different from the other projects in Allied Therapeutics. It is a very specific medical device for IPF patients that we developed together, Alex Therapeutics, Vicor and patients, doctors. So it will be very specific. And of course, you will it will engage the patients and it will engage the doctors in the development. That's a good way to make sure that we're developing the right product and that we meet the needs of the patient and the physicians. And finally, the clinical trial, how can you say anything about the costs for this fiscal development and comparing the regular projects. Yes, I think We're in the planning phase and discussing, so we will not have an exact figure. But this will be a very different study. So it will be much less cost than a regular clinical IPF trial. So it will not be doctors visits and so forth. So it will be a digital trial in a And so we will have to come back with the exact cost, but we certainly expect the cost to be lower than a conventional IPF trial. Thank you. Our next question comes from Dan Aksutti from Pareto Securities. Please go ahead. Your line is now open. Hi, everyone. Thank you for taking my questions. First one, I was wondering if you would include this maybe In a Phase III trial in IPS of C21 to kind of Increase the amount of data you generate also on the quality of life side of VP01? It's an option, but our intention is to make this as a standalone therapy. Having said that, of course, we can include it in the Phase III trial. We haven't planned the Phase III trial. So I think it remains to be seen. But I mean, it's certainly a good idea that we will look into. Okay. And you mentioned that there's no psychologist involved. Announcement of this program. And they reside in Alex Therapeutics. So that's their area of So they do have the psychology, they have the technical development and the artificial intelligence development and we have the kind of the medical bits and pieces and then Jessica's experience from regulatory and marketing on TTX. Okay. And patients have access to psychologists if they wish to do so through the apps? Not any person. It is not a that kind of application at all. It This is only based on their interaction with the app, so to speak. Okay. Maybe I can add to that. I want to add there. Yes. I can just add that in a sense that computing power has become so powerful that you can basically have A therapist, the AI is the therapist. And so, this all has to be designed, but it's meant to Meet their needs and anticipate their needs. So in a sense, a psychologist or person shouldn't be required. So that's the idea. Okay. Thank you. And one last one, departing a bit from that. Would you also consider to include in your ICF trials, the lung function value test such as the first Asset fee, etcetera, to use I mean, there are also these respirators that you can use and then feed into an app to kind of collect more data points and normal visits. Do you consider that to kind of further digitalize year pipeline. It's a good point. We have a little bit of difficulty with home based spirometry to start with. And I think we should look upon the health aspects of the mental health aspects of depression and anxiety at the first step and then what will come in the future, I mean, remains to be seen. I mean, it's very important not to have a 2 graph of the 2 big, bytes, so to speak. Okay. Thank you very much. That was everything for me. Okay. There between no audio questions, I'll return the conference to you for any further questions. Yes, we have received a few questions that have come through per e mail. So maybe start with the first one maybe for John. How will you secure the application from fraud such as spyware? John, do you take a look at that? Okay. Sorry. Yes. Yes, I'm still here with the hiccup. Great. So thank you for that question. We take security and data protection Extremely seriously, of course, at Alex Therapeutics. And there are several ways where we can how we deal with that. So first of all, Integral in the development process, since we are a medical device, as has been said before, we are under the MDR. And one of the Big main purpose of MDR is to ensure that the quality and the safety standards of the product, which is, of course, for good reasons. So that's one step. We built in an entire development process as we build the product. And on top of that, we have done and succeeded and we will continue to do so attack Penetration testing on the platform and on the products to make sure that we are safe. And the third point I should add is that we Can also localize data, so we can set up servers for specific countries to ensure that data don't travel across country line. We can control for that. Okay. Thanks, John. Another question, maybe for Karl Johan. Are there any competitors in the same area? Not that I'm aware of. Okay. Another one for you. How do you plan to perform the actual integration with Alex Therapeutics in terms of performance of digital trial. Well, I'm not sure I really fully understand the question, but it is a device that is developed by Alex Therapeutics that we will then perform a clinical trial with and the device will then be registered and sold and marketed by us, if that's the answer to the question. Okay. And another question for Jessica. Can you share some granularity on how clinical trial works within this area, maybe in terms of number of size, the number of patients? Sure. So, a clinical trial for ADTX is similar to a drug trial. You have to determine What patient population? How many? What clinical endpoints? And develop your control arm. So all of that will have to be decided. And so it's a bit early to say Right now, how many patients will be able to recruit, but we'll also, of course, be looking at the countries that are most at the 1st markets of entry, where trials will be run. So we haven't determined Number of countries yet, but all of that will be known very soon. Okay, great. Thanks, Jessica. Another question for you. Will the clinical trial take place multinationally? And yes, I'll just I guess that's sort of, leads from the same question. It's Likely that it will be more than one country, yes. Thanks. I think that's it from a Q and A perspective. Let me turn back to Karl Johan. So if there are not any more questions online. I would like to thank Jessica and John for their contributions to this webinar and of course everyone who has listen in and post question to us. And thank you so much and have a nice afternoon and evening.