Good morning, everyone. My name is Brandon Folkes. I am one of the equity research analysts here at H.C. Wainwright, and thank you very much for joining us at our global investment conference. Next up, we have a fireside discussion with Cardiol Therapeutics, and joining me from Cardiol is Chief Medical Officer, Andrew Hamer. David, Andrew, thank you very much for joining us.
Thanks for inviting us.
Thank you. David, I think it is important maybe just to give you a minute or two, or however long you want, to just introduce Cardiol, where Cardiol is today, and where you see the company in 12 - 24 months, just given how significant that could be.
Cardiol Therapeutics is an organization focused on developing anti-inflammatory strategies for cardiovascular disease, heart disease. Primary focus is on rare heart disease, but we also have ambitions for a next-stage asset to go more broadly into mass-market indications. Our lead program is in recurrent pericarditis, which is now being well-characterized with an end-market drug that is generating approximately CAD 1 billion in sales. It is a growing market. It causes significant impacts on folks' quality of life, and we are approaching completion of enrollment in the pivotal phase III program. We also have a focus on a second-stage asset addressable to heart failure, where the data from our phase II global ARCHER trial has really provided strong encouragement to push forward with that asset.
Over the next 12 - 24 months horizon, we see reading out a pivotal phase III program, taking our next -stage asset in heart failure into clinical development, and pursuing subject outcomes, obviously, in the MAVERIC program, pursuing a New Drug Application for which we have been awarded the Orphan Drug Designation by the FDA for the entire pericarditis landscape, of which recurrent pericarditis is a large subgroup.
Fantastic. Thank you very much. I am going to dive straight in to MAVERIC. You talked about enrollment, right? Can you just walk us through where enrollment is today? What is the remaining patients, or what is left in terms of the enrollment that needs to be taken place to meet that guidance of 1Q data readout? Just perhaps on that, any color from the path of last patient in to top-line data?
I will leave the path from last patient into top-line data for future guidance, once the database is locked out. In terms of enrollment, we have guided the public. We have advised that we were 75% enrollment some time ago. We have an infrastructure of 20 preeminent pericardial disease centers throughout the U.S. Additional centers are coming on board as well, so we could have an infrastructure up to 24 centers. Our target enrollment by the end of this month is 110 patients, and we have not revised that. So that is what I can tell you is in the public domain. Everything else you will have to wait for.
All right. Gives me enough, right? We are on track. I read through from that, so thank you. I do want to talk about the powering, right, and the trial mechanics with MAVERIC. Can you just walk us through the powering of that, and how we should think about the data and what it is designed to show?
Well, we can be confident in the placebo event rate because it is very well established that the placebo event rate in this trial will be 75% recurrences, and over a two- to three-month period. We have a 24-week period that the trial runs for, and we have powered for a 90% power for a 40% relative risk reduction. That is an assumption, therefore, that the active arm will have an event rate of 45% or less, compared to the 75% in the placebo arm. That is a very clinically meaningful reduction. Our pilot trial would suggest that we should do much better than that, but it is important to be conservative with your powering.
You talk about that 75% being well established. Is there any risk to this trial if we see anything different? I guess, how sensitive is the trial if we were to see something different in the placebo arm?
We have looked at other connotations of event rates. We are comfortable with where things are sitting at. Any trial is sensitive to event rate, and we do state in our protocol that we will be monitoring event rate, and there may be some flexibility in number of patients enrolled depending on that. But right now we are comfortable with what we are seeing.
Even the real-world evidence or the feedback we are receiving from some of the largest pericardial disease centers in the world, is suggesting the event rate remains at that or higher.
And I believe there's an overlap period, right? When patients are placed on CardiolRx or placebo while rilonacept is withdrawn. Is there any risk we should think about in terms of the timing of the recurrence of that 75%? I guess, any risk in that withdrawal period? If so, if an event occurs in that overlap period, how is it treated?
If an event occurs in that overlap period, that patient cannot be assessed for the primary endpoint because the primary endpoint is from the time of last dose of rilonacept. We're comfortable that it's very unlikely anybody would have an event in that period because they're on their rilonacept, which is a very effective drug. The reason for the good overlap is because whilst rilonacept does continue to have effects for two to three weeks after its last dose, some patients have had recurrences quite early, if you look at the observational data. While get to 75% at two to three months, and the average time tends to be around eight weeks after the last dose that patients have their recurrences, it's a variability.
Having a good 10 - 16 days overlap is important to make sure that you've got a really good exposure to our drug before you've withdrawn the IL-1 blocker.
Very helpful. Thank you. If we think about the phase II data, obviously, it looked really good. Can you just talk about, though, what gives you the greatest confidence from that phase II data in terms of that it will translate here and, especially, are there any endpoints, whether it be the primary or any other secondaries or any measures you think are most translatable and others that are perhaps a bit more variable?
Well, the pilot trial was very much designed upon the pilot trial for rilonacept, and primary endpoints was the eight-week point of reduction in pain and CRP. The most important thing for the feasibility of the phase III trial is the extension period to that pilot where we withdrew all background therapy down to monotherapy CardiolRx. We were very pleased to see that the CRP remained low, the pain levels remained low. What's most important is comparing their historic event rate prior to trial enrollment, when 40% of patients are on corticosteroids, 80% on colchicine, and they were having 5.8 events per year. That comes down to the weaning and monotherapy period of the extension where we saw 0.9 events per year.
As said, that would suggest we'd get a much better result than a 40% relative risk reduction in phase III, but we don't want to underpower the trial, and we don't want to miss a clinically relevant reduction.
Yeah.
It's definitely the annualized event rate that is the most important observation from phase II.
Okay. Staying along that theme, moving to MAVERIC, what does, I guess firstly, a clinically compelling MAVERIC result look like? Is a commercially compelling MAVERIC readout any different to the clinical? I guess what I'm saying is, are there any secondary endpoints you think are particularly relevant for the commercial perspective here? Especially, to give physicians confidence to use the product, and I'll leave it at that before the follow-up.
What the specialists are telling us is that anything in even the 35% reduction in event rates would be overwhelmingly adopted into clinical practice. In fact, the architect and the principal investigator for the trial, Paul Cremer from Northwestern, in a recent KOL call, suggested that he would adopt such a medication into his practice at a much higher percentage than even we internally were forecasting. To Andrew's point, I think the trial is very conservatively powered relative to the observations in phase II, because for that primary reason, we don't want to miss a treatment effect. I think we've worked with the FDA, we've worked with the experts in the field to set this trial up for maximal chances of success, and that's what we look forward to.
When we do think about the trial design, understanding exactly why you chose this patient population while you're coming off rilonacept, right? If we think about the commercial opportunity and those discussions you're having with KOLs, are they viewing the product and the readout in MAVERIC as using CardiolRx post rilonacept in their practice or earlier in line where we think there's a tremendous opportunity as well before going onto an IL-1?
I'd say both. You can look at the low-hanging fruit in the market as an off-ramp to rilonacept. But the mechanism of relapse or the pathophysiology that leads or the biology of relapse is the same, irrespective of if it's tapering from IL-1 therapy or your first episode for that matter, or non-response to any line of therapy. It is simply an enrichment strategy. We've selected patients at the highest risk for relapse. We've put the drug to a tough test, but to make the study efficient. I think it's also important that we are following in the footsteps of another drug that went through the same path. We have a very similar phase II program and a very similar design in phase III, and that's what the FDA has already approved down those lines.
We're not going into a path of unknown from a regulatory treatment point of view.
Certainly the experts and the prescribers, which is the people that are enrolling this trial in the U.S., they very much are looking at this as you show benefit in the off-ramp benefit, you will be replacing corticosteroids in the treatment paradigm. The FDA have had very specific discussions with them about that as well, and they perceive exactly what David says, the pathophysiology is the same across the whole spectrum of pericarditis, and therefore the indication would be across the spectrum.
Okay, fantastic. You did touch on the FDA, and the FDA, there is precedent for this. Anything you want to say on your interactions with the FDA to date? Whilst it may be early on a label perspective, but that this enrichment strategy has the potential to drive a broad label.
Can't really comment on anything more than we've already discussed. We've discussed publicly that we had a very successful end of phase II meeting. We presented the design. The design, we're aligned with the FDA with respect to this design, subject outcomes, of course, supporting a prevention of recurrence label. In fact, if you look at the run-in period of the RHAPSODY trial that led to the approval of rilonacept, ARCALYST, our run-in period is essentially the same. So the question we're answering is the same, and that led to a prevention of recurrence label for ARCALYST. So we see no reason that our label wouldn't be the same.
Yeah. If you want to Google enrichment strategies-FDA, you'll see an entire guidance, which is very key to how we've designed the trial and functioning the trial and gives us huge confidence that the FDA both understands, but also encourages and sets out guidelines for how to enrich a trial, which we've followed.
Yeah. I think it's also important, the architects of this trial is the same experts in pericardial disease that designed the studies for the rilonacept program.
Fantastic. I do want to just touch on, and if you don't mind walking us through the medical as well as payer value proposition here. I know you've talked about price in the past. Especially if we assume that there is a big market ahead of an IL-1, can you just help us think through that medical but also payer value proposition here for CardiolRx?
I think from a medical perspective, they're looking for a drug that is more accessible, oral, more convenient for patients, more accessible from a price point of view. When you look at the pricing side of the equation, we've done extensive work with payers. Obviously the market precedent is a very expensive medication. We were very encouraged by the pricing the studies resulted in. It's actually a striking premium to what we had been anticipated. I think the value proposition for our drug is it can be dispensed out of larger points of care through specialty pharmacies, more convenient for patients, more accessible, and most importantly, potentially disease modifying. So there could be a path off the drug. For a payer's perspective, they're not signing up to a perpetual commitment to a profoundly expensive medication.
Our drug will be more attractively priced, more accessible for patients, and potentially there will be a way off the drug much faster than the immune-suppressing strategies.
Fantastic. I do want to touch on the rest of your portfolio because it is not just CardiolRx in recurrent pericarditis. I do want to just stay on the commercial theme quickly. Can you talk us through the options you will have to commercialize this drug, and the ability to potentially self-commercialize an Orphan Drug Designation in recurrent pericarditis, but then also how there may be additional indications that you could build out a commercial organization should you wish?
There is lots of precedents for both. There is precedents for strategic partnerships, revenue sharing, outright licensing, and going it alone. This is a highly specialized field. There are specialized clinics set up throughout the U.S. to care for these patients. It is an infrastructure that can be detailed by a reasonable size sales force, like sub -100 detailing reps, for example. That is within the realm of possibilities for an organization to grow into. We see ourselves as a drug discovery development company first and foremost. That is our area of expertise. We have not built out a commercial expertise, but other organizations that started out as drug development discovery companies did morph into those commercial enterprises in rare disease for highly tactical strategic marketing efforts. The board will assess all of those in due course, and we will pick the best pathway forward for ultimately commercializing the drug.
Fantastic. I do want to move to CRD-38 because it is obviously a very interesting program. Can you just let us know how developed is that product profile today, and what should we be watching out for over the next 12 months in terms of news flow from that program?
Over the next 12 months, you should be watching out for that drug to go into first in man, so clinical development. It is preclinical going through the IND-enabling work because it is a reformulation. It is the same as the lead molecule, but it is a reformulation of the lead molecule. Therefore, the IND-enabling work has to be repeated for good reason. We are working our way through that process, and we see that really the interest in that molecule becoming exponential on the readout of the pivotal phase III MAVERIC program because the molecule is the same. We just have a more elegant, efficient way to deliver it in a SubQ format, hopefully once monthly for chronic mass market conditions that are orders of magnitude larger than the rare diseases such as heart failure.
I think all of that comes together around the phase III readout next year. You've seen, you no doubt have observed some of these high-profile challenges with the other immune-suppressing strategies, the anti-IL-6 strategies. I think early 2027 could be a time of great interest in a non-immune suppressing, potentially once-monthly therapeutic profile that addresses inflammation and fibrosis in heart disease.
Fantastic. I do want to just touch on the broader potential of CardiolRx. I think we've had some data this year. If MAVERIC were to read out positively, how do we think about balancing potentially partnering in CRD-38, taking MAVERIC forward with CardiolRx forward in recurrent pericarditis, but also maximizing the potential of the molecule CardiolRx in other Orphan Drug Designation indications? Should we think about continued development of CardiolRx into other indications?
I think you can. The ARCHER data points to multiple other areas of heart failure medicine or cardiac disease. The largest of which is heart failure itself. I think you could think of potentially the drug being deployed in persistent myocarditis patients once in market with a label for recurrent pericarditis. I think you could even envisage it going. There was a very provocative question asked in that KOL call with Paul Cremer, could you ever see this first line? Paul Cremer's response was, "I like the way you're thinking." I leave it at that.
Well, I think that's a great place to leave it. David, Andrew Hamer, thank you very much. Appreciate your time.
Thank you.