SIGNIFICANT EVENTS DURING THE FIRST QUARTER
- Continued focus of the operations towards research and development, including a reduction in staff and overall improvement in cost control, has contributed to lower expense base.
- In March, Vivesto announced that a clinical efficacy study with the veterinary oncology drug candidate Paccal Vet is planned to start in the second half of 2023.
- In March, Vivesto was informed that Elevar is discontinuing its efforts to develop and commercialize Apealea and instead seeks to transfer its rights to a third party. Considering the uncertainty regarding the launch activities of Apealea, Vivesto decided to write down balance sheet items amounting in total to MSEK 190 in the annual report as per December 2022.
- In January, Vivesto announced Inceptua’s decision to withdraw market authorization application for Apealea® in Switzerland.
FIRST QUARTER: JANUARY 1, 2023 – MARCH 31, 2023
- Consolidated net sales amounted to TSEK 0 (0)
- Operating profit/loss was TSEK -21,537 (-26,329)
- Net profit/loss after tax amounted to TSEK -20,429 (-26,457)
- Earnings per share amounted to SEK -0.04 (-0.06)
CEO REVIEW
With just over four months behind me as CEO, I have gained a good insight into the business and gotten to know the team at Vivesto. Together with management and external expertise, we initiated a thorough review of the company’s assets and organization during the quarter and evaluated various possible ways forward for Vivesto. Although the work is still in full swing, we have already been able to draw significant conclusions that have resulted in several important strategic decisions. In addition, our purposeful work with cost control has continued and the company’s burn rate is expected to continue to decrease as we focus the business and further reduce our personnel and operational costs.
As a result of our review, we decided to intensify our investment in veterinary oncology. There is a great unmet medical need for better treatments and more effective veterinary oncology drugs. This is especially true in the treatment of cancer in dogs, where drugs developed for humans through so-called off-label use are widely used. Since today’s human medicines are not designed for use in pets, they are often associated with side effects and lack of efficacy. It is clearly demonstrated in current paclitaxel formulations which, due to the fact that they contain the solvent cremophor or human albumin, are not tolerated by dogs and therefore are excluded as a treatment option despite paclitaxel being a well-documented and effective cytostatic drug. The market for veterinary medicines in general is growing as the number of pets grows, and especially the number of dogs. At the same time, we are becoming increasingly aware of the importance of caring for our pets and more willing to pay for adequate medical care and medicines.
Based on the great medical need and the commercial potential we see in the field, we have decided to initiate clinical development of the veterinary oncology drug candidate Paccal Vet. In a first step, we plan to start a clinical efficacy study with Paccal Vet in dogs in the cancer indications hemangiosarcoma and malignant melanoma during the second half of the year. Both are indications where there are currently no approved chemotherapy treatments available. Positive safety and efficacy data are already available for the use of Paccal Vet in dogs. A pre-submission meeting with the FDA is planned to discuss the continued clinical development path for Paccal Vet and we await feedback from that meeting in early summer.
In March, American pharmaceutical company Elevar Therapeutics announced its intention to transfer the rights and obligations of the cancer drug Apealea to a third party. Vivesto has had a global strategic partnership with Elevar since 2020 and so far Apealea has been market-launched in Germany by Elevar’s partner Inceptua. Although there are ongoing pre-launch activities in other markets, such as the UK, our view is that the launch and sales in Europe have developed significantly slower than expected. We therefore see Elevar’s announcement as a potential opportunity where we could find a more suitable partner to drive sales and the continued development of Apealea. We are now working intensively with Elevar to explore all the possibilities that this new situation may present. In parallel, we are also working to find a partner for Apealea in China, which we see as an important and prioritized market.
An important part of the review has been to evaluate the company’s existing development projects to find out if it is possible to increase the chances of success, shorten the time to market approval or increase the future market potential. As a result of this work, we intend to expand the indication area for the Cantrixil cancer program to also include bladder cancer and blood cancer, both indications with high unmet medical needs and significant commercial potential. I look forward to coming back with more information when we have a more detailed development plan in place.
Patient recruitment in the investigator-initiated Phase 1b study evaluating Docetaxel micellar in patients with metastatic prostate cancer continues and more than half of the planned patients have been included. However, recruitment is somewhat slower than expected and we are therefore evaluating together with the study’s sponsor, the Swiss Group for Clinical Cancer Research (SAKK), various opportunities for continued recruitment in the study. In doing so, we hope to be able to keep to the schedule and complete the study before the end of the year and be able to present results in 2024 according to plan.
In addition to our clinical projects, we are actively working to develop the next generation drug delivery technology XR-18, a technology that may play an important role for many molecules that today cannot be used because they are too large or do not dissolve properly. XR-18 works in the same way as Vivesto’s existing technology XR-17, which is used with the drug Apealea, among other things. It makes poorly soluble substances soluble in order to improve uptake in potential patients. In addition, XR-18 has some improved and novel properties that are currently being evaluated in ongoing in vitro studies. In parallel with the development of XR-18, early evaluation of trials with poorly soluble drug substances is also underway. What we have observed so far looks promising, although the project is at an early stage.
To streamline the organization and reduce our running costs, we are now reorganizing Vivesto to strengthen our focus on research and development. This means that we reduce the company’s internal expertise in quality control and analysis in the production of pharmaceuticals, as well as general administrative resources to partially replace them with external consulting services. It is estimated that the number of permanent employees can thus be reduced by five people. At the same time, the Chief Medical Officer has announced that he wishes to seek a new assignment outside the company and we are now reviewing the possibilities of replacing the need for medical expertise with flexible external resources to further streamline operations.
Overall, after my first months as CEO, I see significant potential in Vivesto. This applies both to our existing assets, as well as the opportunity to develop the company by using the expertise and experience we have internally in taking a drug from early development, through the clinical and regulatory development stages. An expansion of the portfolio with projects in preclinical or early clinical development phases will be evaluated. Drug development in the early phase involves less extensive studies and requires significantly less resources in the form of capital and personnel, while the increase in value in a project can be significant in the event of successful development. The possibilities are many but given the current company-specific conditions and the overall market situation, the company still intends to have a strict cost focus.
Our work continues with a clear ambition – to develop Vivesto into a leading research and development company focusing on the development of new treatment options for patients with high unmet medical needs.
Thank you for your continued support.
Erik Kinnman, CEO of Vivesto
The report is available on the company’s website: https://www.vivesto.com/en/financial-reports-and-presentations/
For more information:
Erik Kinnman, Chief Executive Officer
Phone: +46 018-50 54 40
E-mail: IR@vivesto.com
About Vivesto AB
Vivesto is a specialty pharmaceutical company focused on the development of new therapeutic options for patients suffering from hard-to-treat cancers. It has a growing pipeline of clinical-stage assets targeting late-stage cancers. Apealea® (paclitaxel micellar) is being made available to ovarian cancer patients through a partnership with Elevar Therapeutics, Inc. Development programs include Cantrixil, in clinical development for late-stage ovarian cancer, and docetaxel micellar, in development for advanced prostate cancer. Vivesto has proprietary drug delivery technology designed to improve solubility, efficacy and safety. Vivesto’s shares are traded on Nasdaq Stockholm (VIVE). To find out more about Vivesto please visit www.vivesto.com.