WntResearch’s CEO: “If the effect is confirmed, there are good opportunities for licensing agreements next year”
In the Q1 report, Per Norlén writes his first CEO statement for WntResearch since taking office in March. The company’s focus right now is on the NeoFox study where recruitment is in full swing.
– We will put most of our focus on patient recruitment and business development in the near future, says Per in a comment to BioStock.
WntResearch is developing the drug candidate Foxy-5, a peptide that mimics the function of the endogenous WNT5A protein. The goal is to prevent the cancer cells from spreading. The phase II study NeoFox is currently underway, evaluating the candidate’s efficacy in colon cancer. At some 20 clinics in Spain and Hungary, up to 80 patients will be recruited, half of whom will be treated with Foxy-5 between diagnosis and surgery, which is normally about 3 – 4 weeks.
– We hope to be able to show an effect on primary tumours and local lymph nodes based on CT scans, and to confirm the effects previously seen on local spread based on tissue analysis, CEO Per Norlén tells BioStock.
By all accounts, 2024 looks to be a crucial year for WntResearch, which is expected to conduct an initial analysis of the study results towards the end of the year. If the company is able to validate previous ad hoc observations, it will find itself in a very attractive position.
Seeing great interest in the project
Several major pharmaceutical companies have shown interest in the project, and, should the results prove to be good, in-depth partnering discussions will be the next step.
– The goal is to out-license Foxy-5 to a partner who has the ability to both develop and commercialise the product so that patients with colon cancer can benefit from the treatment, writes Per Norlén in the report for the first quarter.
Strong focus on business development
So, in addition to conducting the study itself, business development is high on the agenda.
– For successful business development, it is absolutely crucial to build long-term relationships with the companies that we hope to enter into partnerships with, Per Norlén tells BioStock.
– Our positive ad hoc observations have made many people want to talk to us, and they are interested in deepening the discussions as soon as we can confirm our previous findings. We hope to be in that situation towards the end of the year, which will provide good opportunities for out-licensing next year.
In addition to the usual participation in the BIO-Europe Spring partnering fair, a collaboration with Business Sweden was initiated during the quarter. The purpose is to help the company establish contacts with potential partners in Japan and South Korea.
– We plan to hold a number of meetings with Japanese and South Korean companies during this and the coming months. The goal is both to identify new potential partners and to follow up with the companies that have already shown interest.
– We plan to hold a number of meetings with Japanese and South Korean companies during this and the coming months. The goal is both to identify new potential partners and to follow up with the companies that have already shown interest.
Strengthened finances
In addition, WntResearch strengthened its financial position during the quarter by increasing its cash position through a rights issue of SEK 31.4 million. After a cash flow of just under SEK -12.8 million, cash and cash equivalents at the end of the period were just under SEK 40 million.
– The rights issue was subscribed to 56 per cent. A fully subscribed share issue would have secured the entire clinical phase II study, but existing funds and warrants are sufficient to push the study past the initial efficacy evaluation towards the end of the year and well into 2025.
He says that that the company can then set its course based on objective clinical effect. At the same time, he points out that it should be remembered that the study is randomised and blinded, which means that the data will be considered reliable, provided that a sufficient number of patients are enrolled.
– If the effect is good, we are looking forward to a very positive journey. And if we have an effect in colon cancer, there are several other cancer indications to explore. But, if we do not see clear effects, it is over. The current financing will take us to that decision.
Next funding round in November
This November comes the exercise period of the first of two warrants that were issued in last winter’s rights issue. With full participation, the company will receive a maximum of SEK 13.4 million. The next round of warrants will then take place in April next year, and the terms for those warrants are the same.
The maximum amount that the company can receive is based on the subscription price being set to amount to a maximum of SEK 0.12 per share. In this context, we note that the share has risen sharply since the rights issue and has recently traded at between SEK 0.10 and 0.15.
– Of course, it is important for the company and our owners that there is a good outcome in the warrants this autumn. The great interest in the share recently may be linked to the fact that the crucial part of the study has started and that we are approaching the important readout this autumn.
– I think the binary situation, where there could either be a big upside or a big downside within the next year, should attract biotech investors. We already have objective clinical data from more than 100 randomised patients with colon cancer that show a convincing effect on local spread. In my world, this gives a reason to believe in a positive outcome, and this is exactly what attracted me to WntResearch, concludes Per Norlén.
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.
