Lund-based Respiratorius continues talks to reach an agreement regarding the drug candidate VAL001. The discussions are now focused on already established contacts, the company states in its newly released Q3 report. When BioStock contacted CEO Johan Drott to get his view of the past quarter, he was hopeful of reaching an agreement.
Many are eagerly anticipating an agreement regarding VAL001, which has been developed for the treatment of diffuse large B-cell lymphoma (DLBCL). Respiratorius has developed the drug candidate as a pre-treatment to R-CHOP, which is today’s standard treatment for the disease. With strong support from previous studies and encouragement from the European Medicines Agency (EMA) to drive further development, the company is facing its most important milestone to date.
Respiratorius recently released its report for the third quarter, where the focus is on the ongoing partnering process. After a year of active searching, the company has now focused the process on the most promising contacts, where there is a strong belief in the possibility of an agreement.
Stronger patent protection
While actively working to secure a partnership agreement, Respiratorius has also strengthened the patent protection for its development project. During the quarter, a patent was granted in Canada, which protects VAL001 as a new oral formulation of sodium valproate in the pre-treatment of DLBCL. The patent has previously been granted in Japan.
In the Q3 report, the company emphasises the importance of its patent protection. As a further step in the patent strategy, a patent application was submitted during the summer that focuses on protecting the newly developed formulation of VAL001, where the direct release of the active substance is combined with a delayed release.
Model indicates success in phase III
In addition to the strengthened patent protection, a model has also been used to simulate the outcome of a phase III study of VAL001 for the treatment of DLBCL. It indicates a very high probability that VAL001 will be successful in the upcoming phase III study, which according to the company, should make VAL001 a more attractive investment for potential partners.
If look at the company as an investment, we see that the stock has fallen more than 60 per cent during the year. The decline, however, has leveled off somewhat in recent months, with the stock trading sideways. At the time of writing, the company is valued at just under 70 MSEK, while discussions are ongoing with potential partners for VAL001.
The company believes that the delay in a partnership agreement, despite the promising clinical results, is due to the fact that the next step in the development, a phase III study, is a significant investment for a future partner.
Comments from the CEO
BioStock spoke to Respiratorius’ CEO Johan Drott to find out more about the past quarter and the period the company is in.
In the quarterly report, there is a lot of focus on the partnering process. How would you describe the period you are in now?
– We are hopeful. Based on the good results we have shown in clinical studies, we are convinced that VAL001 deserves to be developed into a product via a phase III study.
In recent quarters, you have presented news about patent protection and models for predicting success in phase III. What role do they play in the ongoing conversations?
– It’s positive, even though patents are rarely the most pressing issue to discuss in a partner process. It is more important that the prediction of the outcome of a phase III study is positive, which reduces the risk of the investment that a phase III study entail.
Is there anything going on in the project that could strengthen it further?
– We have no development going on, as we currently believe that we have done what we can. We are now focused on the partner process and addressing the questions that are asked.
Based on the discussions you are having right now, what are your hopes for reaching an agreement in the near future?
– Patience is key. Other than that, I can’t comment.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.