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Respiratorius’ H1 marked by positive patent decision and secured financing

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Respiratorius’ H1 marked by positive patent decision and secured financing

13 August, 2024

Respiratorius’ half-year report for 2024 highlights the positive decision from the Patent Trial and Appeal Board regarding the company’s US patent application for the formulation of VAL001. Additionally, Respiratorius has secured capital through a rights issue expected to ensure the company’s operations for the next two years. The company now has continued hopes of finding a partner for VAL001.

Respiratorius is developing the drug candidate VAL001 with the aim of improving the treatment of diffuse large B-cell lymphoma (DLBCL), an aggressive form of lymph node cancer and the most common type of Non-Hodgkin’s Lymphoma (NHL). This type of cancer is becoming increasingly common, and the five-year survival rate with standard treatment is estimated to be 60-70 per cent, indicating a great need for new, more effective treatments.

Respiratorius’ candidate VAL001 has shown promising results in treating DLBCL. The next step involves partnering for the VAL001 program. Respiratorius has identified a potential partner interested in co-financing a phase III study.

Patent progress during the quarter

Respiratorius’ recently published Q2 report highlights the progress in securing patent protection for VAL001 – a crucial part of the efforts to find a suitable partner for the project. The company has faced a challenging review process in the US regarding the patent application for the formulation of valproate, which forms the basis of VAL001. In April, the Patent Trial and Appeal Board (PTAB) at the United States Patent and Trademark Office (USPTO) decided to reject all oppositions to the patent application for VAL001 and to reopen the application without any new objections.

In July, Respiratorius announced that the USPTO had approved the patent application for the formulation of VAL001, granting market exclusivity for at least 20 years from the priority date (April 21, 2016). According to the company, the patent approval is expected to increase interest in VAL001 among potential partners.

The corresponding application was approved in Japan in 2022 and in Canada in 2023 and is currently under review in Europe. Additionally, the review process is underway in several countries for other patent families concerning the use of valproate in the treatment of relapsed and refractory patients, as well as a refined application for the formulation of valproate.

Strengthened cash position

Another significant milestone in the second quarter was the capital raise carried out in June, which initially added approximately SEK 14.3 million to Respiratorius before issue costs. About 50 per cent of the rights issue was subscribed. The capital raise is expected to extend the company’s financial resilience by approximately two years.

The company’s CEO Johan Drott shares more about how the capital will be used:

– In the near future, we will focus on complementary regulatory development work and deepening and strengthening the partnering process, which is possible given the company’s financial position.

The company’s cash flow was SEK -1.01 million during the second quarter and SEK -2.1 million for the half-year, indicating that the company has a relatively low cost per quarter.CEO comments on progress made this year

Johan Drott, CEO of Respiratorius

BioStock reached out to Respiratorius’ CEO Johan Drott to learn more about the past half-year.

First of all, what message would you like to send to your shareholders after this half-year?

– First and foremost, we are grateful for the support and participation in the rights issue, as well as a large portion of the guarantors choosing to receive shares instead of cash compensation as a guarantee fee. The funding allows us to continue the partner process and focus on interactions with regulatory authorities and experts.

Your US patent application has now been approved after a long and complicated process. Why is patent approval in the US particularly important for you?

– The US is the single most important market, and it was unfortunate that the examiner previously decided to dismiss the application. It is not unusual that not all countries approve a patent application, but it negative when a patent application is dismissed, especially in the US. We have now been vindicated, and through expedited processing, the application has been approved, and a patent will be issued as soon as possible.

You mention that you have a commitment from a partner to co-finance a phase III study for VAL001. Can you provide more details about this?

– We are in ongoing dialogue with a potential partner who, was instrumental in exploring the possibility of conducting a phase III study in Australia. When we jointly concluded that Australia was not feasible, they informed us that they still stand by our side and are willing to co-finance a phase III study.

– This partner is not interested in taking the project to market, but rather investing and enabling the project with confidence in its potential.

The company has also raised SEK 14.3 million through a rights issue. How will you use the capital as efficiently as possible?

– We plan to supplement the regulatory development work to a limited extent. The company’s operations are cost-effective, and there is no intrinsic purpose in just keeping the company afloat. We have a responsibility to our shareholders and ultimately the patients. We will continue to work purposefully and cost-effectively to reach a positive conclusion to the partner process for VAL001.

What will be your first priority this fall when the summer holidays are over?

– We will, as soon as possible, explore regulatory opportunities for VAL001 and how we can deepen and expand the partnering process.

What can we expect from Respiratorius before the end of 2024?

– Shareholders can mainly expect us to work purposefully and diligently. This approach yielded a good outcome in the patent process, and we hope that the positive decision will also be beneficial for the partnering process.

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.

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