IRLAB Therapeutics AB (publ)

Welcome to this live broadcasted Q1 presentation by research company IRLAB Therapeutics. Presenting today is CEO Kristina Torfgaard, Executive Vice President Research and Development Niklas Waters and CFO Viktor Sivic. After the presentation there will be a Q&A session with equity analysts and viewers can ask their questions in the live chat. Hello and welcome, Kristina Torfgård.

Hello and thank you very much.

So please go ahead with your presentation and I'll be back for the Q&A.

Sure, thanks. So first of all, on behalf of iLab, I would like to welcome everyone to today's webcast where we are going to present the Q1 report. And if we start with the slides, please. And the next one. is our disclaimers, and then we have the agenda. Next one. So I will start and take you through the news of the period. After that, I will hand over to Nicholas Waters to take you through the R&D update. And this will be followed by a financial update by Victor Sievert. And I will then make a concluding words, and then we will start off the Q&A session. So the next slide, please. I would like to remind everyone and start with this slide. And this is really the basis here for our research. Parkinson's disease is a severe and devastating disease. The second largest of the neurological diseases. And as you can see here on this slide, we can see that there are a number of different symptoms and complications that those individuals that are living with Parkinson's experience. What we have is that we have five first in class candidates. And if we move on to another click there, we have five candidates where they all have a unique, can you click one more? Yes, thank. So we have five candidates in development where we have all are first in class with a unique mechanism of action. Three of them are in development in clinical stage and two of them are in preclinical stage. And as you can see, they are all targeting all the different symptoms experienced by people living with Parkinson's disease. So if we move on to the next slide. We have had a very, very intense and dynamic first quarter of the year, where we have a number of progress, especially in the regulatory field, in the clinical field. As the first one, I would like to highlight here is the positive feedback that we received early on in February from EMA. The feedback on the Mestobitam program, what was covered both the preclinical, the clinical, and also the program for phase three. This will strengthen the potential of the candidate and also the value of mestabutan. We have had positive results in the phase one studies that we have performed on 757. And we have also made the decision together with MSRD Otsuka to initiate a study in patients with Parkinson's disease and apathy. So this is according to the timeline that we had and progress are moving forward. And I would also like to point out that this program is fully funded by MSRJ Åsuke. So finally, we had also the peripamat readout in the top line data that we presented. And here we can see that there is a significant clinical meaningful reduction in fall frequency. And this guide us both for the future designs of the clinical studies, but also we are also looking into the next steps. So I would like to go more in depth in the highlights. So if we click on the next one. So for the more important events here for Mestopetan, as I already mentioned, we had the EMA, feedback, but this time also received feedback on the pediatric program. And what we did was that we submitted arguments that was accepted that there is no need to perform studies in children. And this will allow us now to focus only in studies in adult patients, which is great. And this is in line with the feedback we received earlier from the FDA. We have also received, as I pointed out, positive feedback on the phase three program. And this is really also in line with the FDA feedback that we received about a year ago on the phase three program. In addition to these preclinical and regulatory activities, we have also published an interesting article in the well-known medical journal, European Journal of Neuroscience. So this is an article where the more of the mechanism behind Mestopitan is described. And here we can also see that Mestopitan clearly differentiate versus other candidates already on the market or in development for dyskinesia. And we can also see that we have a potential to move further on and broaden the indication to psychosis. So the next slide, please. For Piripimat, early on in January, the last patient went through the study and we were able then to present the top line results in March. The first presentation, we were very proud to show that we had an effect on the fall rate. However, this was not significant, different versus placebo. Later on then, we did additional analysis, in-depth analysis, and there we could clearly show that we had a significant and clinical meaningful change also on the fall frequency for pripimat. Nicholas will take you through more of the details, of course. For 757, we had positive results, top results in the phase one study in elderly. And these data results together with the study previously concluded in healthy volunteers in younger subjects were able to support to continue with the 757. And we also made the decision to initiate a study in a patient with Parkinson's disease and apathy that will be starting later this year. So the next slide, please. We have also had the opportunity to present the company for investors. So we presented the company strategy and the pipeline First, at the Insight Direct Dagen in January, we had participated at RedEye Investor Forum twice, and also AccessBar and RedEye theme quite recently in April. And you will be able to find their presentations on the web and also on our web page. So next slide, please. So by that, I would like to hand over to Niklas to take you through their R&D update.

Thank you, Kristina, and good morning, every listener. We'll go through the R&D by clicking to the next slide, please. So we start with Mestopatam, and as Kristina alluded to, we've had a quite busy period with Mestopatam from a regulatory standpoint. Next, please. This is a first-in-class compound with the properties of inhibiting dopamine D3 receptors, which are implicated in the genesis of dyskinesia. As a side order, we've worked quite hard on the IPR estate around Mesopotamia in the past few years, and we have expanded the portfolio during the period. the patent portfolio, and we can now see that we can have exclusivity well into the 2040s with the patent estate we have generated so far. The lead indication, of course, is levodopa-induced dyskinesias. We've talked a lot about that over the past years. In addition to levodopa-induced dyskinesias, mestopadam has potential to treat other types of complications in Parkinson's disease and also in other disorders. And we have generated over the past year and published data supporting the use of mestopetam in Parkinson's disease induced psychosis. So this could become the first drug in history, which is both anti-dyskinetic and anti-psychotic without compromising motor functions. We also have generated data supporting prevention or the occurrence of the levodopa-induced dyskinesias. These are preclinical studies, of course. Another aspect in the use of and data we've generated concerning mestopetamine is that it should be possible to optimize the dose of levodopa to support patients' basic functioning, without inducing dyskinesia by pre-treating with mestopatone. And then we also have built a case around tardy dyskinesia, which is also driven by D3 receptors. Next, please. Going back to the regulatory work that we have done during the past period, Last year, we received feedback from the FDA on our plans and on the portfolio we've generated on Mesto Opetan. This year, we also had the opportunity to talk to IMA and get some scientific advice from them concerning our plans and concerning the data we've generated. And the take home message that we have collected is that the agencies, both in the US and Europe, are in agreement with how we should conduct a phase three program for mestopetam. So we have adapted the plans for the studies accordingly. In addition, we've done market research and looking at what health providers across the globe want to see with the new treatment in treating dyskinesia. And that is really important feedback also to adapt parts of the phase three programme to also include information from payers, what they want to see basically. And the key components that we have come up with in the phase three programme is that we will do two parallel phase three studies that will comprise around 270 patients in total. That's 130 patients per study. We will also give the patients who enter into the double-blind treatment arms, they will also be offered an open label extension after the three-month period of treatment has ended, which means that they will be treated for as long as 12 months with mestopetone. And this is to build the safety database. We also have agreement across the globe. All agencies agree that we should use the unified dyskinesia rating scale as the primary endpoint in the study. And we should use the sum of parts 1, 3 and 4. And we should exclude section 2 of the unified dyskinesia rating scale, which deals with dystonia, not dyskinesia per se. The dose that we have chosen have been approved or accepted at 7.5 milligrams twice daily. And this was the dose that had the best effect in the phase 2b study, came in significant on the unified dyskinesia rating scale. Clinically meaningful changes that we saw were significant, combining sections 1, 3 and 4. And in parallel with the efficacy studies, we will also initiate a separate safety study, and that is to make sure that we get the three to 600 patients exposed at. Patients exposed to messed up, which is needed for approval. In for the safety database. Next please. Uh? talking about the positioning of mestopetone. And this is something we've been doing with experts, key opinion leaders. We've also talked to payers and health providers across the globe, looking at the positioning. And during the course of the progression of Parkinson's disease, patients start with levodopa treatment after diagnosis. And as the disease progresses, one adds additional add-on treatments such as MIO inhibitors, COMT inhibitors, but also amantadine in certain regions to manage the complications that are occurring over the course of the development of the disorder. In the late stages of the disorder today, there is a number of invasive strategies to actually manage motor function better than with the oral treatments. And that is infusion therapies based on continuous infusion of levodopa or produodopa. And there is also electric stimulation or DBS, street brain stimulation, inserting electrodes in certain brain areas to control motor function. And the positioning of Mesta-Opetong is in between when the traditional management of motor complications related to levodopa is no longer working, mestopotam fills the gap between that stage and the invasive stages. It also means that mestopotam has the potential to actually delay the introduction of, or could delay the introduction of the invasive treatments. And this is a very important part of the a treatment algorithm where there is no treatment today. Next, please. Piripimat. Next again. This is also a first-in-class compound, acts on alpha-2 receptors and 527 receptors. Also here, we have built on the patent portfolio. We have exclusivity well into the 40s with this asset. And the objective here, the primary objective of this program is to reduce falls in Parkinson's disease, which is the biggest problem. Next, please. This is a huge complication. Almost half of all Parkinson's patients fall recurrently or every year and up to many times a month. And this is, of course, complicating their quality of life or makes it much more difficult to live a normal life. An interesting fact is that in the US in 2020, the spending for handling costs related to falling in the elderly population, not only Parkinson, is around $80 billion, which is a quite large sum of money. So there is a huge market, there is big incentives for health providers to actually help to introduce something that reduces the fall rates and thereby the cost, of course. Next, please. We presented the top line results recently for this trial, the Phase 2b trial with Mr. Pirip Mat. We could see that we had a general reduction in the fall rate in the study. We had a quite substantial reduction of fall rates at the 600 milligram dose in this study, up to 40-42%. We could also see that, but it was not significant versus placebo. We also saw movements in the cognitive scales, which also were in favor of treatment, but did not reach statistical significance. Gladly, we could see that the adverse event profile was consistent with previously reported clinical trials that we've conducted, and the adverse event incidence was similar in placebo and in the treatment arms. Next, please. In-depth analysis, which we talked about a couple of weeks ago, and Kristina mentioned also here in the introduction, We have also looked at the relationship between plasma concentrations and the effect. And in that work, we discovered that there is a very specific band of concentrations or plasma concentration levels that leads to a reduction of falls in these patients. And this is an important discovery. which means that we will be able, we have the potential to actually titrate patients to the right plasma concentration and thereby get the significant effect that we want in future planned or future potential studies. And this was a pre-specified assessment that was mentioned in the SAP, of course, in the analysis plan. And this will be part of the full report and the publications that we are working on right now. Next, please. So in summary, we actually achieved the goals that we had set out with the PIRIPMAT study, that is to get information of the dose-related effects and also the plasma concentration-related effects of PIRIPMAT. 4757, we have the collaboration with both Michael J. Fox Foundation and with MSRD. Next, please. This is a first-in-class treatment to treat apathy in neurological disorders with a focus on Parkinson initially. And this is a complication that occurs in roughly 20 to 70% of all patients with PD and can be also higher in other indications. Next, please. So the progress during the past decade quarter has been quite significant in this program. First of all, we have completed the single ascending dose phase of the phase one study. We have completed the multiple ascending dose phase of the phase one study with results, giving us results that indicates that this is a safe, tolerable and drug with very good exposure in humans. We've done an additional or completed an additional study in elderly healthy volunteers, 65 years and older, and that is to compare with later on with Parkinson's patients as well. That was successfully completed. Together, these make a very comprehensive phase one programme. In parallel, we've also completed the toxicity studies that are necessary to move to the next phase to run a study for three months. And we have just initiated or taken that decision together with our partner, MSRD, Utsuka, to initiate a clinical trial in patients with Parkinson's disease and apathy. And this is a study that we plan to start during the fall this year. Next, please. Going back to the preclinical programs. Next, please. We have two candidates here, 942 and 1117. And 942 is the first in class compound aiming at treating cognitive dysfunction in neurology with a focus on Parkinson's disease for us. Both of these assets are in preclinical development at present. 11.17 is a totally novel strategy and technology to treat the basic symptoms of Parkinson's disease without any treatment-related complications. Next, please. For 9.42, we see quite large market opportunity here. patients with neurological disorders enter into a phase in their life where they have dementia or cognitive decline and the current treatments they have their benefits but also their complications and we think that 942 could be a good add function into this treatment algorithm. Next please. During the the past quarter, we have worked on the further development of the preclinical portfolio around describing the effects of 942. We've also worked on the GMP manufacturing of drug substance, which is a big task, together with developing a drug product that is the formulation of the drug substance. We have also made a decision to slow or reduce the development pace for 942 during the rest of this year so we we are now focusing on finalizing the cmc work and then postponing the toxin safety studies needed for phase one until next year next please uh 1117, this is a familiar slide these days for most of you, but this is a program where we have selected 1117 as the lead compound recently. And this has the potential to be the first drug in a totally new class of treatment strategies for Parkinson's disease, the hallmark symptoms of Parkinson's disease. That is, it has the potential to replace levodopa should we be successful. The point with this drug is that it's a once-daily treatment, which gives constant plasma concentrations over a 24-hour cycle and also activates motor function over that 24-hour cycle. And this is thought to lead to a better treatment without the motor complications, such as intense fluctuations that patients experience. Currently, we are working on the development of the large-scale production for this product. Next, please. We've come quite far on the CMC development. It's still ongoing, but we've come quite far. In addition, we have built on the patent portfolio. are looking forward to initiate the ind enabling studies during the course of the next 12 months next please so i'll hand over to victor to give you some insights into our financial situation thank you nicholas so we can go to the next slide we have

in the end of the quarter about 89 million Swedish krona in cash. However, 58 of those are prepayments from MJFF, and especially MSRD Otsuka intended to cover the cost for the 757 study that has been initiated. And just to expand a little bit on that, we got a quite substantial payment from them during the quarter. This has not been recognised as a revenue as of yet, but rather as a prepaid revenue. So it's in the balance sheet for everyone interested in accounting. When costs occur in the studies, for example, if we get an invoice of one million kronor, then these will of course appear in the P&L as a cost, but we will simultaneously recognize one million kronor as a revenue and thus reducing the prepaid revenues in the balance sheet. So even though we got the payment from MSRD or Utsokea this quarter, there is not a corresponding revenue in the P&L. A little bit technical, but I hope some of you appreciate it. So if we continue to talk about the 757 we can see the light gray bars in the middle table or panel in the bottom of the page we can see that the cost for that program has gone down a little bit and that is of course due to the phase one studies that we have concluded or basically concluded so the the big costs for those were found in q3 q4 So, since we have initiated the next study, we can anticipate that the cost will go up the coming quarters, as that study will cost money, of course. We also internally have an increased focus on cost control. It shows a little bit on the darkest gray bar, where we can see that the cost has decreased a little bit. The middle gray bar is the external clinical cost, which, to be more precise, is the cost for the Phase 2b study with Piripimod, where there is still cost. We expect those costs to be continuing Q2, maybe a little bit less than in Q1, but then we shouldn't have much of those costs going forward. The headcount remains stable, about 30 employees. And we can take the next slide, please. So net sales, 4 million krona. And as I mentioned, this is a corresponding cost for the 757 program that we've had. So we have an operating profit of... loss, of course, of 28 million kronor. And we have cash of nearly 90 million. So then you can read the other numbers yourselves, I guess. So with this, I will hand over to Christina to some concluding remarks.

So next slide, please. So I would like us to go back to the pipeline here. And we have quite a broad pipeline. We believe that this is a world-leading portfolio in developing programs for Parkinson's disease. And as we can see here, we have five candidates, all first in class with unique mechanism. So the first one, Mesut Opetan, we have the opportunity to take this into two different symptoms, I would say, both dyskinesia and psychosis. We are ready to start up a phase three program, and we are working very hard to get a potential partner in place here. For Piripamat, we have just concluded and are evaluating the final results now in the trial, the phase 2b study that we performed in falls and unimpaired balance. We are looking into next steps here, and we'll come back on that. But we can also see that we can broaden this into dementia as well. For 757, in the collaboration with MSR Diotsuka, we have just started off an initiative preparation for the Phase 1b study in patients with apathy to start the second half of 2025. For 942, as we mentioned, we have decided for the benefit of the other candidates to halt some activities here, and therefore we are postponing the start of phase one into 2026. For 1117 for Parkinson's disease, the broader treatment, we can see that we will initiate the IND enabling study, allowing for going into the phase one during this year. So next slide, please. As one of our, as the business model really is that we have business development work and we are partnering. I will ask us to spend a few minutes on this slide. So during this quarter, we are continuing to increase the awareness of the company, both externally, I would say, to different potential partners, both small and big pharma. We have continuous dialogues with a number of potential partners and giving updates and have ongoing discussions there. So after we had the successful collaboration completed with 757, the highest priority and focus is now Mesto, Pertan and Piripimat. But we are also evaluating across the portfolio, also for the other candidates. So the next slide. So I will end off here with take you through the upcoming milestones that we have during the upcoming 12 and 18 months. And as you can see, this will also be a very intensive and exciting period for the company. For Mestopertan, we are continuing with the BD activities and we believe still in initiating the phase three program per epimat to complete the in-depth analysis that we have ongoing, defining the strategy forward here in the development program as well as the BD activities to continue there. For 757, the highest priority is to start up the study with Parkinson's patients in apathy. That is what we also call a signal finding study. That will be crucial for us. And the preclinical activities continue to prepare 942 and 1117 to move in to start clinical studies in phase one. So by that, I think I will hand back to you, Mattias. and we will start the Q&A session.

Thank you. Thank you so much, Christina and team, for this presentation of your results and activities. I will soon hand over to Kevin Sule, who is an equity analyst at Redeye, to ask his questions. But first, let me address the audience. And I want to remind you that you can write questions to our lab therapeutics in the live chat. And with that, please welcome Kevin Sule, an analyst at Redeye. Red Eye, please go ahead with your questions.

Hi, and thank you for taking my questions. Now, as you mentioned, you have an increased focus on cost control and you, for example, decided to slow down the development pace of 942 in order to focus your resources on some more critical activities within the company. Now, could you, to begin with, elaborate on how you decided what sort of candidates to prioritize at this stage?

So I can start for more general and then I can hand over to Niklas as well. But to prioritize the Mestopatan and Piripimat, the two candidates that we have progressed longest with and that are closest to phase three initiation, that's very clear. And while we have very good partnering discussions, we need to have all focus there, both, I would say, internal resources and also if additional studies need to be done. But for them, we have 757 that we have a commitment and we're working with MSRD Otsuka. So they are paying for the activities and we have our internal resources that we include in this collaboration so we have to prioritize as well and this is very beneficial for us and then we see that 11 17 we have seen that there is a huge interest already for these early candidates so we would also like to bring this forward in a quite fast speed maybe you would like to comment if there is not much i think that was a very very well put uh

it's always difficult to make decisions on what to bring forward. It's a sport in itself. But of course the clinical assets, late stage clinical assets are the most valuable ones. Of course, we need to focus on those. With those does not come very much cost. So it's more dry work where we are working on course, discussions with the external work, but also compiling information, creating documentation around the programs. And that is what the team here is working on with those two. When it comes to wet work, of course, 757, as Christina mentioned, is the most important program where we have a partner on board, where we have milestones ahead and where we have clear objectives and milestones ahead and clear. We have also had so good data in the phase one uh part of this uh development program that we we really have to move that forward as quickly as possible and and as i mentioned we have a decision to actually start a trial this year which means that we we work very hard on creating the submission packages for the phase one for the signal finding study or larger phase phase 1b study in in Parkinson's patients. For the preclinical assets, it's always hard to make your decisions there, but for 1117, it represents such a dramatic shift and opportunity in the treatment algorithm for Parkinson's disease. That's our basic reason for choosing to invest in that rather than 942 at this stage. They were head-to-head basically going into IND enabling studies, but we've chosen to move 11.17 ahead before 9.42.

Thank you. And you briefly brushed upon this in the presentation, but with your current main focus being on the late stage candidates and establishing partnerships for Mestopetam and Peter Pimot, What is your current strategy for finding a partner and what sort of characteristics do you look for in a potential partner?

The strategy is, I think, no secret. We want to find a partner who can actually bring this to the market. So the strategy here, we need to have a partner who has the capacity to actually run trials together with us or by themselves and to build the marketing effort around the product. So this means mid-size, small to mid-size, but with commercial ambitions, companies or large companies.

And with the upcoming initiation together with Otsuka of the Phase 1b study with 757, what are your expectations in terms of data and information that you hope to gather from the study? Oh, that's a lot.

As I alluded to, we call this a signal finding study. We are embarking on a program which is a little bit different than previous programs we've run. And this is in part learnings from Otsuka and learnings from our own efforts in Vidmesta, Potomac and Piripimat. We've combined those. So now we're looking at a broad spectrum of endpoints. in these patients, stretching from motor function, of course, this is Parkinson's patients, but most importantly, the neuropsychiatric aspects and cognitive aspects of the treatment profile. So we are collecting data on a number of areas which are important to describe this patient population and also describe the effect of the drug. So it's going to be a huge data set that we generate in this trial.

And we can also add that we call this study signal finding study. That is quite new, I would say, to use that terminology. But I would say it's very similar to getting to a proof of concept to see that it works in patients, which is also the goal for us.

Yes. I understand. And of course, besides the business development efforts and clinical development, IP protection is also a big part of running a biotech company. Now, what is your view on the current patent situation of your leading candidates?

Oh, that's one of the best areas, I would say. We're a really good area. The experience... in this team is huge on this aspect. And as I alluded to, we have continuously built on the IP portfolio for both Mästeröpeton, Piripmöt and for the other assets, including 757. And that is when we make discoveries during the course of development, we immediately patent those discoveries, if they are patentable, of course, inventions. And this has led to the situation where we have the whole portfolio that we have has the potential for compositional matter-based exclusivity well into the 40s. So for instance, as an example, for Mestopaton, which is on the brink of starting phase three, we have the potential actually to get it launched with the maximum 15 years of exclusivity allowed on any market based on patent exclusivity. The average in the industry today is around seven to eight years.

And I would like to add that this is really one of the strengths that Erie Lab has with those very extensive patent times and lives. And having worked both in big pharma and other smaller biopharma companies, I've never seen such a fantastic patent portfolio like this one. It's something really we can be proud of.

Yes. Great. And those were all the questions that I had for today. So thank you for having me.

Thank you. Thank you.

Thank you, Kevin, for those questions. Very good ones, I might add. If we look at 11.17 again, approximately what time could we enter phase two with 11.17?

That's a trick question. It has several vectors, that question, because with this program, with the program, and we haven't really shown the program that we are considering here, but the next step, of course, IND enabling studies, TOCS in two species, then finalize the, of course, finalize the GMP manufacturing, but then in the phase one program, which of course usually starts with healthy volunteers and then you move on to phase two in patients. But here we see an opportunity to actually move quite quickly already in phase one to patients, which means that the year we start or when we start the clinical program, we already have a plan to get as quickly as possible into patients. One of the benefits with this type of molecular strategy to treat Parkinson's is that we have the potential to immediately see an effect after one dose. in Parkinson's patients, and that's quite unusual for a clinical development program. It usually takes years to tease out the effect, look at mestopetam, look at pirepimat. Where are the effects? Where can we actually build a commercial case around the assets? And here we can see an immediate effect after one or two doses of the drug. That will be within the 18-month period that we have outlined in the presentation today, that we have started phase one at least.

Okay, thank you very much. And at the end of the period, you had 89 million Swedish kronor in cash. What is your current view on financing going forward?

Victor, I think this is something for you.

Yes, it might be. Well, a lot of it is intended to use for the 757 study, of course. So that is fully financed and we will use the money needed to fulfill everything that's needed in that study. And then, of course, we have ongoing activities on the BD side and we're thinking about other structures as well to increase the the cache and the runway, of course. So I think that is as much answer we can give at the moment.

Okay, thank you, Victor. And as it looks, your presentation and the Q&A is crystal clear because there are no more questions in the live chat. So by that, I want to thank the members of the executive team at iLab for your presentation and the Q&A.

Thank you so much.

Thank you so much for everyone to joining this call. Yes. Have a good day. Thank you.

Okay. Thank you. And to all the viewers, thank you for participating and look out for the next interview with iLab. Thank you.