Respiratorius takes another step toward partnering
The in-depth partner discussions have resulted in Respiratorius’ potential partner still being interested in co-financing a phase III study. However, additional financial muscle is needed before a study with VAL001 can be conducted.
– We believe that the potential partner’s interest will be an important piece of the puzzle as we continue to work towards an agreement, says CEO Johan Drott.
Strong efficacy data and a promising treatment on the one hand, a costly phase III study in the other. That is the consideration that a potential partner must make when evaluating Respiratorius‘ drug candidate VAL001, developed for the treatment of diffuse large B-cell lymphoma (DLBCL). In the company´s report for the first quarter of 2024, much of the CEO statement talks about this particular topic.
During the quarter, Respiratorius has had in-depth discussions with an unnamed potential partner, much of which has evolved around how the upcoming phase III study should be designed – and financed. The conclusion was that the previously discussed setup would not suffice.
– The interest from the partner to co-finance a phase III study remains, which we believe will constitute an important piece of the puzzle in the continued work to finalise an agreement, says CEO Johan Drott.
Patent case reopened
Another important piece of the puzzle came in April, when the Appeals Board at the US Patent Office ruled in favour of the company regarding their patent application. The patent revolves around the oral formulation of VAL001, where the primary examiner had decided to dismiss the US patent application. That decision is now being revoked and the board has also pointed out that there should be no new obstacles to approve the patent.
– This patent approval would of course strengthen the project. Even though the ruling of the Board of Appeal does not equal an approval, it means that application has been reopened and that the examination continues. Our legal representative will continue to follow the processing closely and the assessment is that we should not encounter any new obstacles, and that the application should be approved in the coming months.
Important and value-adding for the project
It should be noted that the company is also working on an additional patent, covering the very latest formulation of VAL001, although it has not yet reached the international phase. That process, however, is completely independent of the Appeal Boards decision.
– The fact that our patent application is active again is important for the project. It is not unusual in itself that patent applications are not approved in all countries, and this is not something that a potential partner pays too much attention to. However, the fact that the patent application was previously rejected, and thus did not offer any product protection in the United States – i.e. our most important market – may have been perceived as negative.
Rights Issue to finance continued business development
While Respiratorius has been working to reach an agreement regarding VAL001, the financing of the business has become a growing concern . During the first quarter, cash flow was SEK -1.2 million, which meant that cash at the end of the period amounted to SEK 0.7 million.
To meet the challenge, the company announced their intention to carry out a rights issue of units of initially approximately SEK 28.6 million. The news came in connection with the Q1 report.
– Given the recent positive signals for the VAL001 project, we think the conditions to further pursue our partnering process are good. Hence, we have now chosen to carry out this issue to finance the continued work, says Johan Drott.
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.
