Early this week, WntResearch published its 2020 year-end report, and BioStock has taken a closer look at the most important points. The company was significantly affected by the health care reprioritisations resulting from the Covid-19 pandemic. Going forward the company is focusing on its main project Foxy-5 and carrying out the ongoing phase II study NeoFox. At the same time, WntResearch intends to carry out a rights issue in order to finance the continued work. BioStock has spoken to acting CEO Anders Rabbe to find out more.
WntResearch develops drug candidate Foxy-5, which inhibits cell migration and thus the spread of cancer, i.e. preventing the risk of metastasis from primary tumours. In the ongoing phase II study NeoFox, the company is specifically examining whether the candidate can reduce the risk of recurrence of cancerous tumours in patients who have had surgery for colon cancer.
Covid-19 delays phase II study Neofox by 18 months
In the year-end report, the company notes that 2020 was an unusual year. The hospitals in Spain and Hungary that participate in the company’s phase II study have introduced restrictions and been forced to change their priorities, which has affected patient recruitment to the study. Despite Covid-19, about 60 patients have been included so far, but the recruitment rate has varied considerably during the autumn and winter. At the same time, many patients already included in the study have had difficulty following the planned treatment and sampling schedule. In total, WntResearch estimates that the pandemic will delay the project by approximately 18 months.
Adjusting and focusing activities
The lower activity in NeoFox has also meant that the company could adapt its costs. During the fourth quarter of 2020, an operating loss of just over 6 MSEK was recorded, which can be compared with a loss of almost 8 MSEK for the corresponding period in 2019.
As a part of the strategy tackling the pandemic’s impact, WntResearch will going forward focusing its resources on the Foxy-5 project, which means that it will down prioritise the development of the drug candidate Box-5. The company plans to restart NeoFox this summer and aims to reach a recruitment of a total of 180 patients in a first phase. At the end of 2022, the company expects to be able to perform a first interim analysis, on 120 patients who were followed up at least 6 months after surgery in order to get a sense of the potential effect of Foxy-5, and at the same time get guidance for further development.
In parallel, the work of strengthening the project as a whole will continue, where the company, among other things, validates and scales up the new manufacturing method for the active substance in Foxy-5.
Rights issue to finance the continuation of the study
At the end of the fourth quarter, cash amounted to just over 24 MSEK. In order to be able to pursue the ongoing phase II study all the way to the planned interim analysis, WntResearch is now carrying out a rights issue of approximately 55 MSEK, which is expected to bring in an estimated net of 45 MSEK. The issue also includes warrants which, if fully exercised, can potentially add an additional 82 MSEK.
BioStock contacted the company’s acting CEO Anders Rabbe to find out more.
Anders, you joined WntResearch as acting CEO this fall, at a time that is rather special for the whole world. How would you describe your time at WntResearch so far?
– Very hectic and also challenging due to the fact that it is much more difficult to meet people in person. But we have succeeded beyond expectations when it comes to generating an effective way of working both in the board and in the management team. Since I took over as acting CEO on October 15, I have prioritised getting a grip on the current situation, to understand where the company’s project is at, what schedules look like and what effect the Covid pandemic has had and still has on our phase II study, NeoFox. Above all, I now focus on how we can further develop the company and in the best way take advantage of our most important asset – Foxy-5.
You have implemented a number of measures to counteract the effects of the pandemic. How do you view wntResearch’s situation today?
-I think we have been quick to adapt and to take the necessary measures both operationally in the company and specifically around the activities related to the NeoFox study. We still include patients in the study and our CRO SMS / Cato, and all the hospitals are prepared to return to full study activities as soon as we see that the effects of the pandemic are mitigated sufficiently, and people can return to a more normal everyday life.
You plan to restart your phase II study Neofox this summer. Can you tell us more about what activities are ongoing at the company until then?
Until then, we will have refined the study protocol to maximise information retrieval and optimise patient inclusion. We are also working on manufacturing additional study drugs to ensure that we have enough to be able to carry out the study according to the revised inclusion- and time plan. We have also accelerated the work of scaling up a new manufacturing method for Foxy-5 with the ambition of having a more cost-effective production and to further strengthen patent protection.
WntResearch also intends to carry out a rights issue. Can you tell us more about what the money is primarily to be used for?
– In total, the Covid pandemic is estimated to have delayed the time plan for the study by approximately 18 months before the study can return to regularly planned activities. This also means that the company has an increased capital requirement of approximately 45 MSEK in order to be able to carry out the study, divided into approximately 25 MSEK on study-related costs, 10 MSEK for the manufacturing of a new study drug batches (existing batches have passed their expiration dates) and approximately 10 MSEK for overhead costs for running the company. The need is based on having included up to 180 patients until December 2022 as well as additional company operations and studies until the summer of 2023.
We are very pleased with the great interest in WntResearch’s development of Foxy-5, which has been a prerequisite for entering into relationships with investors and ensuring the implementation of a rights issue. Issue proceeds from the planned rights issue provide WntResearch with the financial resources required to carry out the NeoFox study until an initial readout of effect data and also ensure that we can continue the development of Foxy-5 in accordance with our business plan and strategy.
By taking a big step towards securing the necessary financing to run the company’s core activities until the summer of 2023, we have also taken a big step towards potentially helping hundreds of thousands of patients to an improved cancer treatment in the
The content of BioStock’s news and analyses is independent but the work of BioStock is to a certain degree financed by life science companies. The above article concerns a company from which BioStock has received financing.