Nyrada Inc. (NYR) Earnings Call Transcript

Good morning, ladies and gentlemen. I just want to say thank you for your time and especially James here, the CEO of Nyrada to join us to have a very, very in-depth discussion on a few key topics that he wants to talk about with the business. I'm excited myself, I'm sure he is as well. And James, thank you, again, for your time. My name is Harry Macaskill, I'm one of the senior advisers here at Sharewise, they're a share advisory firm in Sydney. And like I said, we're looking forward to hearing from James, but I'll let James introduce himself, a little bit of Presentation, he will share his screen. And then like I said, the Q&A at the end where we can answer any questions you guys might have. So feel free to drop in any questions throughout the conversation, and we'll go from there, but James thank you again.

Yes. Thanks, Harry, and thanks, Sharewise for the invitation. It's great to get the opportunity to tell the Nyrada story.

Excellent. I've been following for a little while, so I'm excited myself, but I'll let you take it away.

Okay. So Nyrada is an ASX-listed biotech. We're based in Sydney, and we're a developer of small molecule drugs. And our lead program is a drug we're developing to treat brain injury. So I wanted to start by covering a little bit about my expertise and what got me to join Nyrada. So back in the early 2010s, I was involved in a major traumatic brain injury study. It was one of the largest studies run at the time, was a 270-patient study run at 20 sites in the U.S. and we recruited around about 270 patients. And these were patients who are moderate to severely injured. And one of the things that struck me was 2 things, really: The frustration around the fact that there are no drugs that have been approved to treat this indication. So there was a sense of frustration not only from the families of these victims, many of whom were young people who had suffered serious motor vehicle accidents or falls. But also from the medical professionals that I was dealing with. And I remember a story a trauma neurosurgeon told me at a site in Texas. He was saying that even a drug that gave a 10% functional improvement would be revolutionary. So that really stuck with me alongside the fact that it was a poignant reminder of the seriousness of TBI for patients and these families. So what I'm going to do in this presentation, it's a short presentation. I'm going to run through the significance of this technology, how it works, I'll cover that briefly and what our plans are and why I see it as a compelling opportunity for investors. So in a nutshell, Nyrada's mission is to change the unacceptable reality of brain injury by developing a groundbreaking neuroprotective drug. And the aim really is to bring hope and tangible improvements to patients and their families. So here's a copy of our standard disclaimer. This can be found in the deck that we submitted to -- lodged with the ASX this morning. So a little bit about Nyrada's expertise in the area and what our approach is. So I mentioned we're a developer of novel small molecule drugs. We use what's called a rational drug design approach and that differs from what was done in the past where biotechs and pharma companies would screen thousands of molecules to see what worked. With the advent of technology, we take a different approach. We select therapeutic targets that are interesting to us, and we develop novel molecules using sophisticated computer modeling. So the focus for the company is on developing novel treatments for serious and life-threatening conditions, particularly in areas where the existing treatments are either suboptimal or even don't exist and traumatic brain injury and stroke for this criteria. So just a little bit about the origins of our drug program, our brain injury program. Back in the mid-2000s, and this was following on from advancements in gene editing, scientists were able to develop a mouse, which had an ion channel knocked out and these are TRPC ion channels, which is the target for our drug and what I'll be talking a little bit more about. What this knockout mouse did was it enabled scientists to study the effect of these channels on the body. And what came out of that was TRPC channels being a promising therapeutic target and that's what we went after. And one of the findings from this research was that these TRPC knockout mice, and this is a remarkable finding. They were protected from secondary brain injury. So that work, along with some pioneering work that was done at UNSW Sydney led to the development of a drug, NYR-BI03, which is our lead compound and that's what I'll be focusing on today. So there are some features of this program that are worth pointing out. The fact that we use rational drug design means that we designed a drug with one specific target and one specific purpose in mind and it is to block these TRPC channels, effectively doing what is happening or recurring in the knockout mouse. And we're able to develop a molecule, NYR-BI03, that is not only highly potent but just recently, back in February, we published data on an efficacy study in a stroke mouse study. And the result we got from that was quite astounding. We got a 42% neuroprotection in this mouse with our drug. So that showed that the drug worked and it sort of validated the central hypothesis. We're also hopeful that the drug will be safe and well tolerated. The fact that these knockout mice who don't have these ion channels are viable, they live normal life spans, they breed normally and so on and work we've done so far has confirmed that with our drug. But before we advance the program into the clinic, which is the next milestone for the company, one thing we have to do is prove that the drug is safe and tolerated in a battery of studies. And that work is undergoing or underway now, and we're reporting those results as they come in. So that's what we have to do before we advance to the next stage. One of the other things, I'll point out about this program, is the fact that TRPC channels, based on this research that was done in the knockout mouse, has been shown to be a therapeutic area that covers multiple indications even outside neurology. So these TRPC channels are widely distributed or expressed in the body. So they play a role in a number of diseases outside of stroke and traumatic brain injury, including in therapeutic areas like the cardiovascular system, kidney diseases as well as cancer. So the strategic focus of the company, currently, is to focus on neuroprotection with NYR-BI03. And what we're looking to do is, specifically target moderate-to-severe traumatic brain injury and stroke. So they're the first indications that we're going after. So just a little bit about the market. The TBI market is large as is the stroke market and they represent unmet clinical need. So there are currently no approved drugs for treating traumatic brain injury and the treatment options to stroke are rather limited. In the U.S., each year, around 2.5 million to 3 million TBIs occur. And of those, about 10% to 20% are moderate to severe. So we're talking about a lot of patients, 250,000 to 600,000 patients who are underserved at the present time. So the stroke market is, in fact, even larger than the TBI market. Each year in the U.S., around 795,000 people suffer a stroke, about 85% of those are ischemic strokes, and I'll talk a little bit more about that shortly. The only treatment option available for ischemic stroke is a drug called, it's a tissue plasminogen activator or TPA drug. And what that does is it breaks up the clot in an ischemic stroke. Unfortunately, the drug is only applicable to about 10% to 12% of patients. The reason for that is that needs to be given within a very strict 4.5 hour window and a lot of patients don't make it to get treated within that time period. So there's a large percentage of patients who are underserved again in the stroke market. In terms of the size of the TPA market, just to give you some context, the global TPA market each year is worth between around USD 1.5 billion to USD 2 billion and about 50% to 60% of that revenue is generated in the U.S. So just one other point I'll make on this slide. We've been successful in establishing a number of key collaborations. We've got a collaboration with UNSW. And we're very fortunate to have on a scientific advisory board, Professor Gary Housley who did a lot of that pioneering work with the knockout mouse. And we also have a formal established partnership with the U.S. Department of Defense through the Walter Reed Army Institute of Research. That's very important to the company because they ultimately will be one of the larger customers if we're successful in developing this drug because TBI, as you would appreciate, is a major health concern in the military. So that collaboration is structured around the cooperation research and development agreement. And we're hopeful that all going well with our development that will pave the way for nondilutive funding for later development in TBI.

That was going to be key question I had, what are the opportunities for nondiluted funding for Nyrada projects?

Sure. Well, a lot of work has been done in the last decade since the trial I was involved in, in setting up infrastructure to run traumatic brain injury trials. And there's a work group that's been set up between the U.S. Department of Defense, the FDA and industry as well as academia to look at these questions around how these trials are run. So a lot of the funding has gone into setting up that infrastructure. But now there's a focus back on to funding promising drug treatment programs. And so I think we're in a good position. We're in the right place at the right time with this drug in this indication. And it's something we're actively pursuing.

Yes. Excellent. Thank you.

So this slide here sort of explains what the drug does. And with brain injury, there's a primary injury that occurs immediately after the impact or the ischemia in the case of stroke. And with TBI, the injury is caused by either mechanical forces and they can be penetrating or nonpenetrating or rapid and sudden acceleration or deceleration. And what that does is it causes an [ infarcted form ] as the primary injury. In stroke, the mechanism is slightly different. It's usually caused in the case of an ischemic stroke by a blood clot and that causes oxygen deprivation and you get an infarct. But secondary brain injury, which I'll come on to now is common across both. Just in terms of the primary injury, which you can see in the blue panel at the top left, it typically affects about 5% to 15% of brain tissue, but that depends on the severity and location of the injury. Secondary brain injury is a process that occurs in the hours and days following the injury. And what this does is it expands the area of damage and it can typically add an additional 25% to 40% depending on the severity of the injury. And you can see that in the green panel at the bottom left, this is actually a brain from a pilot study we did with Walter Reed. And you can see in the top image, the primary injury, this is a penetrating brain injury. It's the brown-shaded area that runs through the brain. And the slightly lighter color in the green panel indicates secondary brain injury. So that's what this drug is designed to address. That secondary injury is caused by a process called cytotoxicity, which I'll come back and talk a little bit about shortly. But the graph on the right, it sort of summarizes the trajectory and the objectives of this treatment. What we're looking to do is minimize that secondary injury shown by the green line from the solid line down to the dotted line, and the aim of that is to minimize the area of brain tissue damage and minimize the level of disability. So what the drug does is it blocks these TRPC channels, thereby lowering or mitigating cytotoxicity. And I'll talk a little bit more about that shortly. Now this is a bit of a scary slide, if you're not a cell biologist but I've got an analogy here which might help. This image here represents the bio-machinery behind the neuronal signaling. And so what you can see here is the surface of a brain cell. And just a sort of an interesting aside, the average adult brain has 86 billion of these neurons, so quite a large number. And the way these neurons communicate is that they use chemicals and one of the key chemicals for signaling is a chemical or a neurotransmitter called glutamate and you can see that labeled here. And what that does is, it binds to a receptor and it sends a message to the cell to basically get excited and start sending messages. And so one way it does that is by opening these ion channels, which you can see on the right-hand side, and you can see the calcium is the blue dots. Now the problem with glutamate -- in a normal circumstances, in healthy brain that whole process works quite smoothly. But when a brain is injured or a neuron is injured, it starts releasing glutamate. And you get this compounding effect of too much glutamate opening these ion channels and letting in calcium, and it gets into an overexcited state. And one way you can think of this as the cell being like an electrical grid with the neurons rely on a steady flow of calcium. But what happens following injury is that you get like an electrical surge and that is damaging to the cells. So what NYR-BI03 does is it effectively blocks these channels like you would see in an animal that didn't have these channels and that limits the excess of calcium entering the cell. So this calcium builds up when these channels open to levels that are toxic. So it effectively acts like a circuit breaker and that mitigates the risk of secondary injury. So the company's got a very busy 6 to 12 months ahead. We've got several key catalysts that will really determine the trajectory of the program. I mentioned we're undertaking safety and tolerability studies before going into Phase I. That's progressing very well and that work is necessary before -- sorry, before we can move into a Phase I study. So we'll be reporting on that work as it proceeds as we receive the reports, so watch out for that.

And James, just to jump in really quickly, we've had a question, someone asked me, are you fully funded for that human Phase I clinical trial for the NYR-BI03?

Well, in terms of funding, there are a few unknowns at the moment. We're still getting quotes for some of the key work. We're currently having our accounts audited, and we'll be releasing that information to the market shortly, I believe, in the next week or so. And also the other unknown is the R&D tax rebate. So we've got an R&D tax rebate that will be due for the '24 year. And we haven't calculated the quantum of that yet. So there are a few moving parts to this, but there'll be some news on that when we publish our accounts.

Excellent.

But we do -- in the last accounts, we reported $4.7, just-over-that, million in the bank and as I said, with the R&D tax rebate pending. So the other key milestone for the company in the near term is, obviously, the initiation of that Phase I trial. And in parallel with that, we're also running the study with Walter Reed looking at the drug in a penetrating ballistic brain injury model, which is along the lines of those images I showed earlier. So that will provide crucial efficacy data to take forward the drug in TBI. So here, you can see an overview of the study design. So it's a healthy volunteer study, and it's going to be run here in Australia, in fact, here in Sydney. And it's a 2-stage design. So initially, we'll be dosing healthy volunteer subjects with single doses. And there'll be 3 cohorts of those doses that we'll be escalating. And following that, we'll then be dosing for 72 hours in 2 later cohorts. Each cohort of subjects will be 8 in number, 2 will receive placebo and 6 will receive NYR-BI03. And the objectives of the study, what we're trying to do here is to show that the drug is safe and well tolerated in healthy human volunteers. And what we're also trying to determine is what the pharmacokinetics, what the blood levels look like, how long the drug stays around in circulation and so on. So just to summarize, I think the program presents multiple compelling reasons for excitement and optimism.

I think you went back one slide instead of forward.

No, I'm just wrapping up. I didn't go back, sorry. Yes. So just to wrap it up. So the key features of the program, it's a first-in-class opportunity. This drug is novel, and it's treating unmet clinical need. The markets in stroke and TBI are large and unfortunately, they're growing. People having strokes younger these days and also we've got an aging population. And on top of that, in the TBI space, we've got global conflicts around the world as well leading to more TBI injuries. As we discussed or as I mentioned, there are nondilutive funding opportunities available, particularly for TBI through the DoD and that will enable us to secure funding if we're successful with our shareholder dilution. And also, I think the final thing to say here is that we're pioneering in an area with a promising target and a potent drug. So that opens the way for us to move into other indications, and that will drive growth for the company.

Yes. Excellent. I think it all looks very, very good. We've got a couple of questions coming through. So we may as well answer a few of those and see what you've got to say. So we've just had one come through from Colin, what is the potential -- sorry, James, what is the potential for treatment of concussion for example in sports injuries and things like that?