Herantis Pharma Oyj (HRTIS) Earnings Call Transcript

So good morning, everyone. It's 10 a.m. CET, and we are starting with the Herantis Pharma Webinar on CDNF and the first topline results of the Phase I/II clinical study in -- with CDNF in Parkinson's disease. Obviously, CDNF is aiming at a breakthrough in Parkinson's disease. So we are very excited, but also please keep in mind that this is very early stage in this clinical study. But there's been a lot of interest, so we felt it's appropriate to provide a bit more information on what we know so far. So just a couple of practicalities. First, we are a public company. So this is our usual disclaimer. So naturally, no investment decisions should be made alone by this presentation. And topics of the webinar, some practicalities, and then we will provide a bit of a background on the clinical study and CDNF. The audience this morning seems to be very mixed. So we have patient organizations. We have also some analysts and experts in the field and investors. So we don't intend to provide a complete picture on what Parkinson's disease is. We'll provide some superficial background on CDNF and what we are aiming at and then obviously, we'll touch on the currently known results from this clinical study. And then we have received some questions from the audience already beforehand. Thank you very much for those. So we will try to address those. And many of the questions received will already be addressed during the slides before the actual questions. And some practicalities, your host today will be myself. My name is Pekka Simula, I'm the CEO for Herantis Pharma. And then Dr. Henri Huttunen, the Chief Scientific Officer of Herantis Pharma. And very importantly, please keep in mind that the clinical study, the Phase I/II clinical study with CDNF in Parkinson's disease is still ongoing. So the treating physicians, the investigators actually remain blinded to the study. They do not know which patients have received placebo in the first 6 months and which patients have received CDNF. So also for that reason, we have to be very careful about what we can disclose in this kind of a public nonconfidential presentation. But first, as promised, a brief background on CDNF, the new neuroprotective factor CDNF for the treatment of Parkinson's disease. So we aim at true disease modification. So it's important to keep in mind that while there are already drugs for the treatment of Parkinson's disease, there are no drugs that can stop the progression of the disease. So for instance, while there is levodopa that's been around for decades and that can help alleviate the motor symptoms of Parkinson's disease, it does not stop progression of Parkinson's disease. And our hope is to develop a treatment that can make a significant breakthrough by treating the disease at its course. So we hope that we could help the dopaminergic neurons to stay alive and even recover as the dip of those neurons is the cause of the disease in the first place. And this is exactly the role of CDNF. It's a natural protein, whose role is to keep our neurons alive. So I'll hand over to Henri, so he can provide a bit more science on this topic. So Henri, it's all yours.

Thank you, Pekka. Okay. So just a few introductory remarks on CDNF and also the route of administration that was used in this clinical trial. So CDNF is a natural protein that's found in many human tissues, including our brain. And it protects cells from certain types of stress, helps our neurons to survive in certain conditions. And there's a number of preclinical studies that have shown that CDNF has very promising therapeutic potential in several neurological diseases, of course, including Parkinson's. And despite its very similar name to another factor called GDNF, CDNF works via a very different mechanism, its biology is very different from the GDNF biology. So CDNF protects neurons by a multimodal mechanism. It helps the neuron survive in conditions, for example, in Parkinson's disease, there is accumulation of a toxic protein aggregate composed of alpha-synuclein, so CDNF helps the cells to become more resilient against this type of proteotoxic stress. It also modulates inflammatory processes in the brain, and inflammation is an important contributor in many chronic diseases and also this is known to happening in Parkinson's disease. For more information on CDNF biology, its mechanisms of action and so on, you can find on our website, and in a recent open access review publication shown here on the bottom left. So in Parkinson's disease, there's a very specific population of neurons that degenerate and die during -- already early in the disease and during the course of the disease. And these are the dopamine neurons of the nigrostriatal pathway. The dopamine neurons are located -- their cell bodies are located in small nucleus in the midbrain called substantia nigra, as shown here in the red circle. They send axons to another brain area called striatum, shown here, and particularly an important part of the striatum for this clinical trial is called putamen. So when the dopamine neurons degenerate and die, there's less axonal terminals in the putamen in the striatum and there's less dopamine secretion, which then results in the characteristic motor symptoms of the disease. And based on our preclinical data, we know that CDNF can effectively protect the dopamine axon terminals and the cell bodies and -- in preclinical models. So it's very important then that CDNF is delivered to the brain area where these dopamine neurons are located. Because CDNF is a protein, it cannot be administered via oral or peripheral routes. And for this reason, we have used, in this clinical trial, a very sophisticated device for drug delivery directly into the putamen. So these 4 -- these 2 tubes here illustrate the position of the catheters of the drug delivery device that have been implanted in the subjects in the study. And this device has been designed and manufactured by a British company called Renishaw, who was also a cosponsor in this clinical study. So the patients who were enrolled in this study received either placebo or CDNF infusions directly into the putamen once monthly in this clinical study. And finally, for introduction, I would like to mention that there is a very sophisticated brain imaging technology called positron emission tomography, PET, that we have used for monitoring the functional state and integrity of the dopamine neurons. And here on the bottom right, you can see an image of a typical PET image using a dopamine transporter tracer that we use in this clinical trial as well. So the hot areas, the orange-red areas of the brain are -- show the striatum -- the striatal structure is where the dopamine terminals have a lot of dopamine transporter activity. Now I'll hand over to Pekka to talk about the study design, dosing groups and demographics and so on.

Thank you, Henri. So continuing with the details on the ongoing clinical study, this is a very complex clinical study by design, especially keeping in mind that it's a first-in-human study. So it's the first time in the world when CDNF has been administered to human patients. And so there are 3 dose groups, and there are 3 parts of the clinical study. That's shown in the picture below. So if you start from the left in the main study, the main study has a lower CDNF dose group, a higher CDNF dose group and a placebo group. So part of the patients have only received placebo for this first 6 months that we are now talking. And the green triangle shows unblinding February 2020. So that was what was done just very recently. So we opened the code and now we know which patients have received placebo and which patients have received either of the 2 CDNF doses. And as mentioned, the clinical investigators do not know this yet. And the next part is the extension study, another 6 months. And during this period, all the patients, including those previously on placebo will receive CDNF monthly dosing for 6 months. And then even after this period, the study will continue for a long-term follow-up, total 4 years. In the first year, we will also focus on long-term results related to CDNF, and then going forward, it will be more on the long-term follow-up on having been treated with the dose delivery device. And obviously, this presentation focuses on this first part, the main study, the first 6 months, and we expect to have more results. So results from the extension study in the third quarter this year. The study is conducted in Sweden and Finland, in leading Nordic hospitals. It's been a great collaboration. We are really grateful for the excellent work done at Karolinska University Hospital in Stockholm and Lund University Hospital in Sweden and Helsinki University Hospital in Finland as well as the very good PET centers, Karolinska Institutet and Turku University. Keeping in mind, please, when looking at the results is that this is, again, a first in-human study. So always the primary endpoint in such studies is safety. So the most important observation from this study should be that we hope to confirm the safety of CDNF in these patients. Also for the reason that this is a first in-human study, the patients in this study have an advanced Parkinson's disease. The regulatory authorities have been very strict in that regard that for ethical reasons, we could only recruit patients with an advanced disease. And if you think about Parkinson's disease, it's typically estimated that when the motor symptoms begin, so when the disease is first diagnosed, the patient has already lost maybe 50% to 70% of their dopaminergic neurons. And then if you think of the disease progression, which continuously kills more and more of those dopaminergic neurons. 10 years after disease diagnosis, there is very significant loss of those dopaminergic neurons. So these are obviously not an optimal patient population for a treatment like CDNF, which, as Henri explained, aims at protecting and restoring the function of those dying neurons. Also, 6 months is a very short follow-up time in a Parkinson's disease study. And even from the main study for the first 6 months, we don't yet have all results. We received some questions, for instance, on the alpha-synuclein data, we don't yet have those data available. So this is still a very kind of superficial first links into the results. But that's exactly why we are very excited to, already at this stage, see a signal of biological activity of CDNF. So -- but still focusing on the safety and tolerability of CDNF. Demographics and the Parkinson's disease characteristics of this patient population. As said, these are late-stage Parkinson patients. So I think the most important take-home message in this slide is the bolded line here, disease duration since first motor symptoms. As you can see in all 3 groups, in placebo and both CDNF groups, the patients have been -- have had roughly 10 years since the diagnosis of the Parkinson's disease or since the first motor symptoms. So these really are relatively advanced Parkinson's disease patients. And to summarize the safety, here is a summary on the most common study drug-associated adverse reactions. Of course, this study also investigated the safety of the device and the dosing procedure and the surgical procedure. But from CDNF viewpoint, the most important thing, of course, is the safety of CDNF and any adverse reactions we have seen that are possibly or probably related to CDNF. And we've been very pleased to see that these adverse reactions are very mild. And also, there is no essential difference between the placebo group and either of the CDNF group, which, of course, suggests that we haven't seen any concerning signals on the safety of CDNF. Maybe one thing that might be of interest on this slide to an expert is the cerebral gas embolism, the first line there, that's something that's been seen only in imaging. It's not been a clinical observation, but -- it's been possible fluid pockets or small gas bubbles detected near the catheter tips in the -- after the dose administration in the patients. And these have resolved. So nothing uncommon. As a matter of fact, experts have told that in the brain stimulation patients, similar observations are not uncommon. Safety summary, then looking at the big picture, as said, the current data suggests that CDNF is safe and well tolerated in patients with advanced Parkinson's disease. That's, of course, very important for us going forward. So the main study has met its primary endpoint on safety and tolerability of CDNF. And then there was also a question from the audience about the serious adverse events that we mentioned in the company release earlier this week. So the dose administration, as Henri explained, involves the use of a dose delivery system, which is surgically implanted -- or was surgically implanted before the dosing started. The surgical procedure is very similar to a deep brain stimulation surgery in Parkinson's disease. But of course, we have to keep in mind that this is the first regulated clinical study in which this dose delivery system has been used even though it has previously been used clinically under a hospital exemption in Parkinson's disease and some other diseases. So there's always a steep learning curve when using things like this, and of course, also the sites involved in this clinical study have no prior experience with this very device, even though they are very experienced in neurosurgery. So we have seen adverse events, and actually, 2 patients were discontinued from the study due to serious adverse events that were infections requiring hospitalization. Both patients have recovered. So that's, of course, the most important thing. And also very importantly, we have taken safety measures. So basically, mitigations involving new instructions and better care of the dosing system and more detailed instructions on sterilization related to the dosing administration. And since the mitigation actions, we haven't seen new similar events. But of course, this is something that needs to be followed closely also going forward and make sure that similar incidents won't happen again. So that summarizes the safety. And then we get to the exciting part of the exploratory endpoint on that PET imaging Henri mentioned. And the excitement at least for myself personally comes from the fact that these observations we have here seem to be such that cannot be explained in any other means than CDNF being biologically active in these patients. So these are observations that we haven't found any other plausible explanation for. It's very unlikely a placebo effect, it's very unlikely any other effect. But I'll hand over to Henri, again. And Henri will provide you with more scientific details. So Henri, it's, again, all yours.

Thank you, Pekka. So in this study, like Pekka explained, the safety and tolerability were the primary endpoint and of course, because patients or people with Parkinson's were enrolled in the study, we had an opportunity to also follow their symptoms and the course of the disease. So we included several secondary and exploratory endpoints in this study. The secondary endpoints included validated clinical rating scales, such as UPDRS and several others. However, the analysis of this data is still ongoing, and we at this point will not disclose any results of the clinical rating scales. However, the PET imaging is, of course, very interesting in terms of target engagement and possible responses at the tissue level. So -- as I briefly mentioned in the introduction, PET imaging can be used to follow specifically the functional state and integrity of the nigrostriatal dopamine neurons and the dopamine system in the midbrain. And for this purpose, a specific radioligand called fluorine-18 FE-PE2I is injected to the patients and then brain scans in the PET scanner are recorded. And as you can see here in the image, the -- first of all, the tracer is very specific to this brain area, where the dopaminergic neurons and their terminals are located. And in Parkinson's disease, it's known that this signal declines over time. So on average, 6% to 13% decrease annually can be observed in patients -- people with Parkinson's, whereas with healthy age-matched controls, there is very little decline in the dopamine transporter PET signal. And so considering that this study -- the main study lasts for 6 months and the extension study another 6 months, we can expect a detectable decline in people with Parkinson's over this time course. And if you're interested in learning more about this particular dopamine transporter PET ligand, you can find more information in this publication shown in the bottom. So in the main study, patients were -- the subjects were scanned in PET at baseline, meaning before the first dose administration, but after the device implantation. So that is called baseline. Then the second scan was taken at the end of the main study. So after 6 monthly doses of either placebo or CDNF. And what we could observe is that in the placebo group and in one of the CDNF groups, we saw a very clear decline in the average DAT binding potential or DAT signal. This range from 6% to 21%. But very interestingly, the average DAT binding potential in the other CDNF group was increased by about 17%. And when we look at closer at this particular CDNF dosing group, we detected 2 individuals, which showed a very significant increase in DAT signal, the PET signal. And this signal is of magnitude 37% to 51%, which is clearly very different compared to the placebo group patients, for example. And very importantly also, there was no increase in DAT PET signal in the nucleus caudate, the other part of the striatum, which indicates that the effect is specific for the area of the brain that has been infused with CDNF. And of course, we're very much anticipating to see the next time points. There are PET scans also recorded at the end of the extension study, so at 12 months, after 12 monthly doses and then in the follow-up study at 19 months. So altogether, while, of course, this is early and preliminary data, we believe that this could be an indication of biological response in the infusion area where CDNF has been delivered. And this is, of course, very exciting and the increased signal could be an indication of improved integrity or restoration in the nigrostriatal pathway. I will hand over to Pekka for some conclusions.

Thank you, Henri. So again, this is something that has really excited us because as you see, this is -- these are advanced stage Parkinson's patients, and we're really not expecting to see any signals after the first 6 months. So we were really, really excited to see that potentially disease modifying treatment appears in some patients to be doing exactly what we have hoped it to do. But of course, keep in mind, it's still early days, and we must continue to work and wait for more information and see how everything turns out in the next 6 months. Just to provide some conclusions on the observation so far. So primary endpoint met on the safety and tolerability, as mentioned. And in PET imaging, after 2 months, we have a significant increase in the PET signal after 6 months of treatment. And this is really interesting because we have patients, as Henri explained, in whom the expectation is a continuous decline, which should already be visible in this 6-month period. We have also seen some promising signals in some other endpoints of the study. As Henri explained, we are also looking at several other exploratory endpoints that could provide signals on efficacy. Typically, they are not as hard evidence as PET. So often clinical endpoints could have a placebo effect. And this is something that we'll investigate further in the extension study. So we have decided to not disclose any details on those at this stage in time. Also, the data analysis on the main study continues. So even for the first 6 months of data, we, for instance, don't yet have the alpha-synuclein results that could provide another hard endpoints, if you will, on the potential activity of CDNF in the patients. So the next readout is expected in the third quarter of this year for the ongoing next 6 months of treatment, the extension study. Of course, the other reason for our excitement is that we continue the development of the xCDNF, the next-generation CDNF that, based on available data, is sharing the same biological mechanisms. So if CDNF is biologically active in the patients, then we have all the reason to believe that also xCDNF would be. And the xCDNF seems to be suitable for a much more simple administration. So based on available data, we believe that it will be possible to administer it without the surgical procedure and the dose delivery device.

So after that conclusion, the questions that we have received from the audience, beforehand, thank you very much for those. So many other questions have hopefully been already addressed in the previous slides. But just to sum up some that have not. So first question, I have Parkinson's disease, can I volunteer for CDNF therapy? It's important to understand that all clinical development is very strictly regulated. Of course, we want to move forward as fast as possible, but we have to do that honoring all the rules and regulations of clinical development, which are there to protect the safety of the patients. So we will first have to complete this clinical study and then as soon as we know enough so that we can file for future clinical studies and have them approved by the authorities, we will obviously keep everyone informed. So please follow up at our website, but also please remain patient, as drug development is always too slow from the patient viewpoint, unfortunately. The next question, obviously, when will the next clinical study with CDNF begin? And what kind of a study will it be like? So again, please keep in mind that even the first clinical study is still ongoing and a lot will depend on what the eventual results of this clinical study will be. If the current signals strengthen, then, of course, we will have a more compelling package to the regulatory authorities. So we can hopefully convince them to go as early stage Parkinson's patients as possible in the next clinical study, which would be, as we believe, the optimal patient population for this kind of treatment, patients who still have as many dopaminergic neurons left as possible. But it's still too early to speculate more on what that study could look like. We definitely plan to start the next clinical study next year in 2021. Also, there was a question on whether we would continue using the same drug device combination. And based on this clinical study, we believe that that's a very viable approach. Of course, we are also looking at other alternatives and very naturally our next-generation CDNF hopefully will provide an approach in the future where the drug device combination is not necessary. But that's still early stage. And since the CDNF development is several years ahead of xCDNF, we believe that it's definitely -- we definitely owe it to the patients to continue developing the drug device combination so that we could bring this for the benefit of Parkinson's patients as soon as possible. Some more questions. Very obviously, why didn't we see the effects of CDNF in every patient in the clinical study? This is probably explained already, but I think this is a very important point to understand. So this is the first in-human study in patients with advanced Parkinson's disease. These patients have very little dopaminergic function left, of course, because of the disease progression. Whereas CDNF, based on scientific data, functions on restoring and protecting the dopaminergic neurons. So CDNF can restore the functionality of dopaminergic neurons that have lost their functionality but are still alive. However, if those dopaminergic neurons are dead, if they are through apoptosis, there is nothing that can be done to create new dopaminergic neurons. So that's very important to understand that these are not the optimal patients for CDNF kind of treatment. Also, the -- in clinical development, in general, not just in CDNF, the first in-human studies are all about safety. They are not even yet about dose ranging and finding the optimal dose. So we don't yet know what the optimal dose of CDNF is. We are very fortunate actually that we have been able to convince the authorities to already have different dose groups and a placebo control in this first study. So we will learn a lot from this study, and that will help us design the next study with much more information that's typically available after Phase I study. But there's still a lot to learn about the optimal dose of CDNF. Also, the treatment period so far has only been 6 months. That's a very short period of time in Parkinson's disease. And part of the patients have, of course, received placebo. So we would not expect to see any signals in those patients, at least in the hard endpoints such as PET imaging. Also, it's important to understand that Parkinson's disease is very heterogeneous. There are no 2 patients that are alike. If you just look at the standard of care, levodopa and other Parkinson's drugs, they are always kind of customized for each patient and the dose of the drugs is adjusted for the patient also with disease progression. So even with the currently available drugs that only aim to alleviate the motor symptoms, each patient has to find their own dose. So that is also something that we may need to consider in the future with CDNF. In this clinical first in-human study, we have been required by the regulatory authorities to just have the fixed doses for the entire duration of the study. Then there was a good question on whether we have any anecdotal evidence from the patients in this clinical study? And again, the clinical investigators remain blinded. They don't know which patients have received placebo and which patients have received CDNF. So we have to be very cautious about even having too much discussions with them about the patients. So even if we could disclose some details on this without -- while protecting the identity and patient privacy, we would not disclose anything at this stage. And we prefer to minimize the communication on the investigators at this stage. Hopefully, we have addressed all the questions from the audience either in the last 2 slides or previously in the presentation. This presentation will be shared on the company's website later today. So feel free to get back to it. And if you have any pressing questions, of course, we are always there, always welcome, especially any communications from patients as we are a truly patient-centric company and the patients are who we are doing this work for. And once again, our warmest gratitude to the patients who have participated in this clinical study. This has been a very complex clinical study also for the clinical investigators who have done a great job, but especially for the patients for whom this means several repeated visits to the study sites, not just for the dosing, but also for the PET imaging and the CSF samples for alpha-synuclein and so forth. So thank you very much. Thank you, audience. I hope you have enjoyed this. Thank you, Henri, for co-presenting, and we wish you all a great day.