Modus Therapeutics Holding AB (publ)

Welcome to today's live broadcast from Modus Therapeutics, where we have with us the company's CEO, John Öd, to comment on the book release communiqué that the company presented here this morning, on January 20, 2025. And as usual, you can, as a follower of this live broadcast, ask questions to John directly in the chat. We have actually already received some questions, but that's just asking questions, so let's make sure that John can answer them as soon as possible. But then I say welcome to John, first and foremost.

Thank you, Martin.

The end of the book came out here this morning. You describe it as a revolving year for Modus, characterized by groundbreaking clinical progress and an enhanced pipeline. I'm just thinking about how you see the ongoing year and the position of the company before 2025.

I think it's positive. This year, after a capital acquisition, we made it possible for us to drive the latest integration forward in the preparation work towards the planned start of the study in Nysjuka with Anemi. It is a transition for the company that with its portfolio comes into phase 2, where we We are ready for our self-suggestion and now in phase one for anemia and chronic disease.

I thought it would be possible to comment on the financial position of the company, especially liquidity. You have as a goal to secure funding for part 2 in the CKD Anemi study under 2025 and also to secure funding for the phase 2 program for sepsis. How do you think about that in the future?

Yes, I think we are taking it step by step. Now we are focusing on the new disease indication and business development and research development on the sepsis side. So the focus right now is that liquidity should meet the chronic new disease indication. And there we have, as before, It's been clear that we have funding to take the company forward to part one of the study. And then we have traditionally had a combination of drug financing and financing in the market to take us further. And we look at the opportunities that we have in the future to be able to finance part two as well. It's completely clear.

I have a question here from the chat. Will you possibly have a partnership, i.e. a license agreement with Big Pharma? It may be difficult for you to answer, but it was a question anyway.

I can say that a company like Modus has a discussion all the time that should lead up to partnerships or other types of similar solutions, licensing, co-development. So that discussion is ongoing all the time, partly because we are active at these types of meetings where you can constantly meet business developers from the big companies and other interests, partly through running contacts that we have. And you can actually compare this to a a constant house-to-house education, if you want to understand it from a perspective for those who don't work with this all the time, where the factors that play into it are, of course, how good the knowledge you have, how unique the positioning can be, but also how far you have been able to take away the risk for a company or a partner to be able to take over or go in and cooperate with you. Another big factor that affects us and that we must be aware of and that we try to communicate every time we summarize, as we have done in this report, is in the environment. Often things happen in the environment, both scientifically and technologically. One example here is that over the past year, a lot has happened with machine learning and AI in the sepsis area. especially a company that has entered phase three with a diagnostic alternative that can predict sepsis. This opens up our opportunity and our unique aspect to be able to get into the early sepsis process. And such a change, if that development works, could change how those who are interested in the anti-sepsis area see what we suggest and change the requirements for risk addressing in the research we do. So, you balance these factors, but the key is that you are always active in this research process. And an important part of that is that it is important to show our research and our research prospects, which we will continue to do.

The fact that you have widened your pipeline, has that affected, would you say, the interest positively for partners?

Yes, that's what I can say. The pipeline is... is complementary. We offer different opportunities for different interests. Sepsis is a typical project that has a very high commercial potential and at the same time a higher conceptual potential. Since there is nothing approved in this area, the one that goes forward needs to define their area. This includes research concepts and regulatory risks that are balanced from the top. This can involve a group of people, especially those who are interested in acute care. If you look at the cancer area and the anemia, this is a very well-established high commercial area. where the regulatory requirements are very well defined and implemented. What defines our unique positioning is that we contribute with a completely new operational mechanism that can take care of problems that are already existing. These problems are well characterized and expressed in a well-adversed cooperation. While, for example, in SEPTIS, to make that comparison, you can come in late in the process, as many of our competitors have chosen. You can also come in early. You can also segment patient groups based on developing biomarkers and other types of predictive instruments. The path you choose becomes your own path. The last component that we think is particularly unique is the malaria area. Here we have an area where there is severe malaria, where we are completely alone. As far as we know, there is no treatment today that can address the need to be able to bridge between the onset of severe malarial reactions and when the anti-malarial treatments begin to work fully. And this window is very problematic for them, especially young children who are affected by this, because a large part of the deaths that occur in this reaction happens there. And this is a huge problem, especially in parts of the world where there is a moderate market share, but at the same time, distribution and market are driven by large efforts, just like how you roll out malaria vaccines today, where the United Nations buys large amounts of vaccines and distributes them. But at the same time, it is also a rare disease in our part of the world, and something that becomes more and more common is that you bring home a tourist malaria that becomes a severe malaria reaction. So this is a very interesting possibility, which is partly with the big global needs and in which parts of the world this is a difficult problem, we offer financing opportunities that we are currently working for. That is to say, Wellcome pays for this study that is going on now and it is Imperial College that performs it and we are the part that cooperates with this to very low development costs. At the same time, we can remember that investments, large salaries, clean donations are ways that are open for malaria, but perhaps not for many other indication areas such as pharmaceutical companies. In this way, we see that the advantages come from how these three indications complement each other.

There has been a lot of focus on the study on animal diseases since you recently initiated it. What are the primary goals and expectations in the short and long term for this study?

In the short term, we have clearly said that it is easily possible, part two. When it is read out, the goal is to be able to define the dosing levels that follow the capacity of the patients who come in, to define the dosing levels to three or two fixed dosing levels, and in this way make the dosing possible in part two of the study. And then, above all, to be able to see that because it's the first time we go into animal health patients, so that there are no special findings that we haven't seen before, but that we have a safe and good safety profile that we have. There are also studies. We have, for example, a biomarker that has proved to be very important in hepcidin, and there we also have the opportunity to measure it. i den här patientpopulationen första gången. Det är del 1 av studien och sedan tas målen över att starta upp och få igång del 2 av studien vilket måste föregås av att säkra kapital för det. Syftet på den studien är att visa på effekten av of cell baritone in longer treatment of these patients. We are mainly looking at the development of anemia, but we also have, in the same way as our animal models that we have seen, where we see a beneficial effect on the animal function, so we also have the opportunity to look at that type of observation. And we expect that Our expectation is that it will be able to render results in Q4 2026. So those are the primary goals.

Just as I understand it, recruitment of patients is still happening in part 1 of that study, right?

Yes, absolutely. We started it in December and it is still going.

Then I just want to go back to the sepsis indication, because we've had a question about it. And it reads like this. Will you be carrying out any phase 2 studies soon, or are you waiting for the first results from your ongoing studies?

For the moment, we are focusing on the NUR and anemia indication. And at the same time, there are opportunities to build partnerships and, above all, co-develop. development lösningar på SEPC-sidan. Om vi under tiden här skulle lösa den typen av samarbete, då kan vi starta en fas 2-studie parallellt. Annars så är vår grundplan att köra det här sekvensiellt. i tillfälle som den pågående utvecklingen renderar tillräckligt mycket intresse så är vi i startgroparna för att även starta upp sepsisindikationens fas 2-studier.

Sen kom det ju en positiv nyhet från Malaria-studien när det gäller rekrytering av patienter. Ni har 18 av 20 patienter rekryterade där, vilket är ju roligt att höra eftersom det har varit en ganska lång process ändå. När förväntar du dig att ni ska se några första resultat från den här studien då?

Det här är ju en studie som jag brukar säga, vi förfogar ju inte över den eller vi kontrollerar inte den, utan vi får rapporteringar från den studien. Therefore, I can only speculate based on how we see the recruitment report. Now, since October and until the end of the year, when we reached 10 out of 20, and now 18 out of 20, you can imagine that this is heading towards its end. Those who are responsible for the study, of course, want to know the data. My qualified guess is that we will see results from that study during the coming year. That is also what we discussed in the report. And to be able to communicate that it has also been clearly recruited. Where do we go? I look forward to being able to talk about and communicate about where we are going in this collaboration.

I also had a question about the market and competition here. When it comes to modus market positioning, how should you position yourself in relation to the competitors on the market? Are there perhaps no competitors in some parts or how should you look at the competition picture in general?

In many aspects, what we suggest is unique in some of the areas that I just mentioned with malaria. Right now, this window that happens between the establishment of a difficult malarial reaction, which is a sepsis-like reaction, so that you can get full help from the usual standard malaria treatments, that window Today, we are alone in developing. One of our great strategic advantages is that the effects are seen within half an hour. That is, it does not take time for us to start working. We have a very favorable safety profile so that we can enter very sick patients. And the mechanism that is in action with malaria is not is complementary to the standard treatments. So it adds something more. And in the case of sepsis, we can say that it is in the same way. In both of these situations, there are unique additional treatments, adjuvant treatments, that contribute to something that does not exist today in standard treatment. If we look at On the animal indication, we lean towards an effect that affects this important hormone, hepcidin. There is another company, an American company, that has another antibody that can also reduce hepcidin. In addition to that, and because it has turned out to be very difficult to find safe substances that can reduce hepcidin, there are no other competitors. But it should be said that we are at about the same development stage where the first study in new patients takes place in both companies. So there we are quite on the same page, but not alone in trying to exploit the potential of something that can reduce the hepcidin hormone. So hopefully unique in all three areas.

Yes, and if you look at the market size for respective indications, given that it is complementary, do you see it as if you will probably take part of a larger market rather than a whole market, if you say so, when it comes to your indications?

Yes, that's how we look at it. You look at which market we have. But then these markets, Malaria is a bit special in this regard, thanks to the fact that it has two different types of indications when it goes to the whole world. another type of distribution and marketing model in the rest of the world. So it is important.

If we look forward then, milestones for 2025, we have been talking about them briefly, but what do you see as the most important strategic milestones when we enter this year?

It is to read part of the new study, to see the Malaya study, It's also about financing and starting up part two of the new study. That's one of the three most important steps. We also have ongoing research where we expect to be able to, in the right scientific context, How will the reporting look like?

How will the milstorps be reported to the market?

When it is done, we will of course report that part. But then, of course, it was very important to update on the start of part 2. But then, since it is a longer treatment part, it will still have to run into 2026 before it reads out. And the same goes for malaria studies, with the exception that there we are more dependent on a third-party reporting to us.

Yes. I thought that you could finally share a little visionary what you see Modus here in a slightly longer time perspective. What is the vision here to take the company to, so to speak?

The vision is of course that in phase two to maintain conceptual proof of data. data, so-called proof of concept. And we consider that to be the key to be able to deliver sufficient risk addressing to be able to make a reality of our business model, namely that together with a a partner to take the further development to the market. Because we see that market maximization comes best together with a partner who has a market organization and a market distribution that is able to take care of these high potential indications. And that is what this conceptual proof process is all about.

Jonny, do you have any last words regarding 2024 and into 2025? Is there anything we have forgotten?

No, I just want to thank you for the confidence we have received so far from our investors in the market and those who have been with us for a long time. And at the same time, everyone in healthcare and in the science sector who sees the opportunities and continues to cooperate with us, because a lot of what we do comes from fruitful and long-term collaboration with these two parts. Thank you very much, John.

And thank you to all of you who watched today. We will be back next quarter with a new update. Have a good one.

Thank you very much.