IRLAB Therapeutics AB (publ) (IRLABA) Earnings Call Transcript

Good morning, and welcome to the ABG Investor Days. My name is Alexander Krämer. I'm a biopharma analyst here at ABG. Today, I have the pleasure to host Kristina Torfgard, the CEO of IRLAB Therapeutics. Welcome Kristina, and the stage is yours.

Thank you very much. Very nice to be here, and I'm very pleased to present IRLAB. First of all, I would like to excuse my bad voice. I had cold last week and apparently, it hasn't recovered, but I hope you can follow me anyway. Thank you so much. Let's try. So this is our disclaimer. So IRLAB, we are a Swedish biopharma company, developing new, innovative, much better medicines for treating Parkinson's disease. And I'm sure that many of you might know someone that has Parkinson's, have seen that this is a lifelong disease. Around 11 million individuals are living with that today, and this is a figure that is going to double during the coming 15 to 20 years. And today, unfortunately, there is still a lack of good medicines to treat Parkinson's individuals with. So we at IRLAB, our aim is really to make a difference with our new medicines. And we do that because we have a vast experience in the field. Our company is founded by scientists that has been working together with Arvid Carlsson. Professor Arvid Carlsson, who received a noble prize for dopamine and the research there in 2000. So we have a great experience in the field. In addition to this, we have a unique platform that I will talk about. And this platform makes it possible for us to develop candidates that are very good -- has good efficacy and good safety, but also through this platform, it makes us have better success rates. So we can take them through the development in a faster pace, but also to a less cost. And both -- those are all three components are doing that we are in a good and a good place where we have a good position to develop these new innovative treatments to make a difference for individuals living with Parkinson's disease. So our strategy and business model. So our aim is to cover all the different stages of Parkinson's disease, all different symptoms, but also other CNS-related diseases. And we do that through our unique platform. And as you can see here, we get true innovation in the candidates that we are developing. We have higher success rate and also a very strong pattern for these candidates that we take through this platform, the ISP, which is called Integrative Screening Process. So we develop these CDs that we call them up till a proof-of-concept, which is normally in Phase II, where we have documented that we have a good efficacy in the target population and where it's aimed to treat the patients in the future. And then we look for partners, different types of setup we can see there. And through this partnering, we get an upfront payment, milestone and royalties. So Parkinson's disease is a progressive lifelong disease. And you can see that it starts already around 20 years before the individual get diagnosis. The diagnosis is set on a typical slow moment, stiffness and tremor, the shaking. And you can see that eventually a number of different symptoms and complications are developing during through the life. We have first-in-class candidates that we are developing and the first lead candidate is mesdopetam. And we are developing that first for dyskinesias, levodopa dyskinesias, but it can also be developed for treating hallucination, confusion and psychosis in the long run. The second candidate, pirepemat, will take care of balance and falls, but it can also be developed further into speech, impairment and swallowing difficulties. The third candidate, IRL757 will -- is currently developed for apathy. IRL942 is developed for cognitive impairment. And then, 1117, this is sort of a new generation of Parkinson's treatment that we are looking forward to see. And here, we take care of the cardinal and typical core symptoms, which is slow movements, stiffness and tremor, shaking. So you can see we are aiming to cover many, many different symptoms and complications through the disease journey for the Parkinson's individuals. Too fast. So I talked about that we have a unique platform. So this is a discovery platform, an Integrative Screening Process. And we have since over -- since 2000 collected information data from in-house generated molecules, compounds and we have generated that and have a database together with reference compound, so to say, which can be drugged on the market or that have been through clinical testing. And this, we have gathered and performed a lot of different experiments and trials. And with machine learning, AI, this is -- I would to point out that we were very, very early using AI here already starting in the 2000. So we are using that. And through this work, we can really select and find those candidates, which has the best properties for different types of indications. And how is the comparison? You can see that the probability for us to start in preclinical and take them through up to Phase III is in around 20%. And if you compare that with industry standard, which is more of the traditional way of target-based research, this is currently around 7%. So it's a better probability, it's faster and also less cost involved in this. And we are, of course, very proud of this platform, and we think that we can use that for many, many other candidates to be selected in the future. However, here you can see our portfolio, and I would dare to say that this is one of the world's best portfolio for candidates in developing treatment for Parkinson's disease. And this is thanks to the platform. The lead candidate, mesdopetam, is in Phase III -- sorry, it's in Phase III ready phase. So we have everything ready to start there, and we are hoping to do that next year. I'll talk more about that candidate in-depth. But here, we also have the opportunity to broaden the indication and broaden the market into psychosis. For pirepemat, we are currently in Phase II. We have an ongoing trial that is going to read out early next year. So it's very exciting. This is the indication for impaired balance and falls. I'll talk more about that also. And you can see here, we also have the opportunity to broaden the indication of the market. Then we have a 757, which is developed for apathy. And the goal is to develop that both for Parkinson's and Alzheimer's disease. Here we have a collaboration, first of all, with Michael J. Fox Foundation, but also with MSRD Otsuka. We have two preclinical assets, it's 942 for cognitive impairment. The aim is to bring that candidate into clinical phase next year and then 1117 also to bring that into clinical next year. So I'll focus a little bit more on each of the candidates now. So mesdopetam, is a unique first-in-class candidate. It's inhibiting the dopamine 3 receptors, and that takes care of the typical levodopa dyskinesia. And for those who haven't heard about that, dyskinesia, levodopa-induced dyskinesia is that, when individuals have taken levodopa, which is the golden standard treatment for a number of years. For some reason, around 25% to 40% of all these patients, they are starting to experience involuntary movements. They are like this, and they can't really control that. And of course, that's very troublesome. So the purpose is to take care of that with this candidate. We have a quite addressable huge population here between 1.4 million and 2.2 million. So it's a huge market. We have very compelling Phase IIb data. And as I said, we can broaden the indication moving in with a Phase II study in psychosis. And the patent situation is great. We have recently extended with the possibility now to exclusivity in the early 2040, which is unique, I would say, for these type of candidates. So what does it mean when we are -- that we are Phase III ready? So just to have some highlights on the Phase II study that we got data some time ago. We -- the Phase II study was a dose-finding study, so the aim was really to select the right dose for Phase III. And we saw that we have a clear dose response, and we are going forward with a 7.5 milligram twice daily now. We saw a significant anti-dyskinetic effect in the study, which has been discussed with the regular authority. And this is going to be the tool and the measurement that we're going to use for the primary endpoint in the Phase III studies. In addition to the anti-dyskinetic effect, we also saw anti-Parkinson effect, which is a bonus, I would say. And this really differentiates us versus other available treatments on the market today. So during this year, we have had regulatory interactions. We have started off with the FDA interaction earlier this year and continue with meetings with European regulatory authorities. It was Germany and Portugal. And we have aligned our thoughts around the Phase III program here. The measurement scale will be the unified dyskinesia rating scale, which is accepted and commonly used for this indication. We have a consensus on the program where we are going with 7 milligrams twice daily. We are targeting the same patient population as in the previous studies, which is very good, especially as we're aiming to generate data similar to the Phase IIb data. In general, it's going to be around 250 to 270 patients, and they are going to be divided in two different Phase III studies. So around 125 to 130 patients in each study and they are going to be treated with either mesdopetam or placebo. They are going to be treated for 3 months. And then all the candidates that are engaged, they -- the subjects they will be asked, and they can continue if they would like in an open-label study. So everyone then will get a mesdopetam for a year, which will be generating data for us on the safety parameters that is needed for regulatory approval. What we have done also to get Phase III ready is that we have done a market research, payer research. So we have gone out to health providers and asked where do they see a lack and where is an unmet medical need. And they definitely see that mesdopetam has a place in the treatment algorithm there. So with this information, we have now been able to design a Phase III program that meet up to the requirements, both from a regulatory perspective, but also from a market research and health economic perspective also. So pirepemat, our second candidate. This is also a first-in-class candidate where we are aiming to improve balance and falls. We have compelling data from a Phase II study and an ongoing Phase IIb study. And also here, we have similarly patent exclusivity, which takes us into 2040, early of 2040. So today, we know that falls and fear of falling, impaired balance, that's a huge problem. And actually, the biggest concern for many of the individuals living with Parkinson's. That's very troublesome for them. So you can see around 45% of those with Parkinson's disease, Parkinson's, they fall, which is a lot. And considering how expensive it is to take care of all these injuries, this can make a huge difference, not only for the patient, but also for the society and for the health care. So in total, it's around 2.5 million the market that we can see that there is a population that we are targeting, and this is U.S., Europe, China and Japan. And we are pioneering in this field during the first study in patients with recurrent fall. So this is an ongoing study in Europe. We have included a randomized all patients in the study. And so the last one was included in September. And the first quarter -- end of first quarter next year is the time when we expect to be able to get the data. So it's very exciting. So, 757, it's another first-in-class. It's fantastic to stand here and say first-in-class for every candidate. Isn't it? And this has an effect on the neuronal activity in the frontal-subcortical neurocircuits. And this helps the area where apathy is. So here we can see that we can treat apathy in many different neurological disorders like Parkinson's and Alzheimer's disease. It can be both asymptomatic but also disease-modifying treatment, which would be fantastic. We have an ongoing study in collaboration with Michael J. Fox Foundation. And we think that this is a very good validation of our research when they sponsor this study. And we have also an ongoing Phase I study with MSRD Otsuka. And I'll talk a little bit more about that. So apathy is very common in both Alzheimer's disease and Parkinson's disease. And we see addressable population is 2 million to 7 million people. So it's a lot and there is no treatment at all for this complication. And we have an agreement in collaboration with MSRD Otsuka that they pay for the development for this candidate all the way up till a proof-of-concept, and then they will have the first option to look into data and license if they want, otherwise, we can license it out to other potential pharma companies and the patent remain by us. So it's a very beneficial collaboration for us. So then we have two preclinical assets. I just mentioned them, 942, which is going to be for improvement of cognition, where it's a huge unmet medical need, 5.8 million people around the world. We are aiming to have this once daily. And 1117, where we see that this could really be revolutionize the Parkinson's area or treatment with a new treatment next-generation Parkinson's treatment where this is aimed to be once daily, because we have seen data that this would be enough with once-daily treatment. And this should be compared with levodopa where we have today people take it for up to 10 times a day, which is a lot. In addition, we don't see that we will have any complications such as dyskinesia or motor fluctuations here. So we have really big hope for this one. So this is now five candidates that we are developing, and we have in our portfolio. And it's quite impressive, I think, having all these candidates that all of them, each can be a blockbuster with -- and here for the first one, mesdopetam through our market research and payer research. This has been confirmed that there's a huge unmet medical need, and this is really correct figures. So it has the potential to be a blockbuster. So what's happening here in the next coming months? So we, for mesdopetam, we are working on the business development and preparing for partnering still, and we have big hope here and then to start a Phase III study as soon as possible with a partner. For pirepemat, it's very exciting with the upcoming data end of first quarter next year. And there, we, of course, are also planning to go out and partner, and we already have a very big interest here from big pharma. For 757, we are completing the ongoing Phase I studies that we have. And during next year, we are preparing to initiate what we call proof-of-concept studies or signal studies in patients. And then for 942 and 1117, we are preparing to enter clinical phase. So very exciting time for us, coming 12 to 18 months. So I'll stop there and hand over.

Great. Thank you very much, Kristina, for this very interesting presentation. I have a couple of questions for you. And maybe to start with the first one with pirepemat. So we expect data at the end of Q1, so we can basically say March. And you also mentioned today that there's a big -- a lot of interest around this product. And could you maybe talk a little bit about, like, in which time frame do you expect to have such a deal with pirepemat with pharma partners with it like 1 month, 2 months or 3 months also considering your financial runway?

So it's very hard to say, because it's a teamwork to find a partner, and it could even be not only one company, it can be different regions. But if we look -- I just read how it is in the licensing and partnering area today. And in 2024, it has only been around 400 deals, while in 2023, it was 700 deals. So it's less of deals for some reason. So it's challenging, and that's what we've seen with mesdopetam. I think we have a very big interest for pirepemat, but it's really hard to say. Usually, it takes -- it can take a year or even so more. So we're just working very hard. I can tell you.

So it could be that maybe you will have some sort of bridge financing of considering your loan, which you have.

Everything depends on what's happening with mesdopetam, how soon we get there in, and then we can see different types of financing options. We're always looking into that.