Cantargia AB (publ) (CANTA) Earnings Call Transcript & Summary

The Cantargia Q1 Report 2025 Presentation. [Operator Instructions] Now I will hand the conference over to the speakers, CEO, Damian Marron; CMO, Morten Lind Jensen; and CFO, Patrik Renblad. Please go ahead.

Many thanks, and welcome, everybody, to today's interim report of our first quarter 2025. On this next slide, you see our safe harbor statement, which, of course, its main effect is to making everybody aware that any forward-looking statements that we make should be taken with great care and not relied on or taken as guarantees of future performance. So, as we've just introduced, I'm Damian Marron, I'm the Interim Chief Executive Officer. I'll be taking the first few slides for you and then handing over to Morten Lin Jensen, our Chief Medical Officer, and we also have Patrik Renblad, our Chief Financial Officer, who will take us through the financial section of today's presentation. So it's been a busy first quarter and actually a busy few weeks since the end of that quarter as well. So, just quickly, here are the significant events that occurred in the first quarter of 2025. I was appointed as the Interim CEO following the resignation of Göran Forsberg, our long-standing prior CEO. We then presented promising Phase I data from our CAN10 first multi-dose cohort, as well as feedback from the FDA and the clinical experts. We finished recruitment in the randomized Phase II Trial 4 study in triple-negative breast cancer with nadunolimab, and we enrolled the first patient in a new investigator-initiated study of nadunolimab in leukemia that is taking place in the U.S., and we published 2 abstracts on IL 1RAP ADC and on nadunolimab's potential to reduce chemotherapy-induced neuropathy. We announced, they will be presented at AACR, which has just taken place. Significant results since the reporting period are obviously the appointment of Morten Jensen as Chief Medical Officer, and he will be speaking with you today. We selected treatment-resistant atopic dermatitis as our second indication for CAN10's Phase II program, and Morten will talk to you more about that, and we have also just announced that pharmacokinetic modeling, which used data from both the single ascending dose groups, but also the full data from the first multiple dose cohort in our CAN10 Phase I study has confirmed our choice of every 4-week dosing in Phase II, which we can see as a potentially quite a significant competitive advantage, and we'll show you some of that data in a few minutes. So moving to focus, first of all, on CAN10 and on the data we've been announcing since the start of the year. So just to quickly remind people, this is the design of our Phase I first-in-human study, our single ascending dose, multiple ascending dose study. We started with cohorts, 10 cohorts of healthy volunteers who received single doses of CAN10. And in each cohort, we increased the dose, and each cohort had 6 subjects who received CAN10 and 2 who received a placebo. That has been completed and finalized as we've already reported. We then moved into the multiple ascending dose healthy subject cohorts, and here, we have 2 dose cohorts, again, 6 CAN10 to 2 placebo, and these dose cohorts will allow us to move into Phase II. So we anticipate finishing this study in Q2 and being able to start Phase II towards the end of Q4 of this year. We also have some psoriasis subjects that we are studying separately, which will enable us to look to undertake some exploratory mechanistic studies, and what we've shown to date is full receptor occupancy on immune cells. I'll show you that in a second, full blocking of IL-1 family cytokines, and very importantly, we have seen no safety concerns in either the single ascending dose or the completed first multiple ascending dose cohort. So, what have we seen as results? As I mentioned there, we have documented full receptor occupancy in the study, and you can see on the bottom left here for 2 different immune cell types, classical monocytes and neutrophils as we increase the dose in the single ascending dose part of the study, we reached full receptor occupancy on both of those cell types. And you can see right on the right-hand side that we also achieved this full receptor occupancy with the multiple ascending dose, 14 days after the last dose was taken. So this is very encouraging data for us. On the right, you see an inhibition assay in whole blood taken from the subjects, and here on the right, you're looking at the ability of IL-36, one of the IL-1 superfamily that we block to induce IL-6 release, and this is either at day 1 with the SAD or day 40 in the multiple ascending dose. And on the right-hand side, day 8 on the single ascending dose, so 8 days after that single dose, or again towards the end of the multiple ascending dose treatment. Again, what you see here is that as we get full receptor occupancy, we also get full inhibition of IL-36 as we increase the SAD, or we look at the multiple ascending dose of 300 milligrams, you can see that we completely block IL-36. There is no more IL-6 release induced by applying IL-36 here. If we go to the next slide, we also looked at the ability of IL-1 beta to induce IL-6 release. And again, we see a similar pattern that we can completely block the ability of IL-1 beta to induce IL-6 release either after single doses or with multiple ascending doses of 300 milligrams. This data is very important because it highlights the unique functions of CAN10 that we can block all of the IL-1 superfamily. So IL-1, IL-33 and IL-36. This is a unique function of an IL-1 RAP antibody like CAN10 and differentiates us from both approved treatments, but also treatments that are in development at the moment, such as the IL-1 alpha beta blocker lutikizumab, the IL-36 blocker, spolimab or indeed the IL-1 beta blocker that is in development by the U.S. biotech Aval, and the importance of this is that we then made the immune cells nonresponsive to IL-1 and IL-36, and these are the immune cells that may grate into the tissues and actually cause the damage that we see with in HS patients, hidradenitis. Finally, I spoke just before about the fact that our data now supports that we can use every 4-week dosing or Q4W, as it is shortened to. We have seen excellent PK results. We have a linear PK profile. We have a higher bioavailability of CAN10, and this model that we're showing here is being developed by Certara using the data from all the subjects in the study, both single ascending dose and multiple ascending dose, and the results from these simulations, as you can see, support the feasibility of Q4 weekly dosing. Along the bottom of the slide, you can see at each 4-week interval that we have 95% confidence, we do not have the drug level in the patient's blood, dropping below what we call the Ctrough level, which is the lowest estimated level that we need for efficacy, which has been set based on the results I just showed you of the inhibition of the cytokines and the receptor occupancy. So, our combined results so far suggest we have great potential for efficacy. We have good safety, and we have certainly great convenience for use in HS and other future applications. And with this, I'll pass you over to Morten to take you through the next few slides.

Yes. Hello. My name is Morten Lind Jensen, I'm CMO at Cantagia. First of all, what we have been looking at is how do we best utilize the very broad mode of action of this molecule. We know that the IL-1 family is broadly associated with both acute and chronic inflammation, and we know that there is a strong involvement of the multiple inflammatory cascades that we impact, and, therefore, it also impacts multiple inflammatory diseases. So this broader mechanism, where we both target inflammation and fibrotic elements, is really something that can be used in many different indications. So we contracted with [ Lumity ] and explored where such a molecule could have relevance and identified both respiratory indications with the bones and joints, indications in the gastrointestinal tract, and other systemic indications. We did identify skin as one of the first indications for us to move into with the hidradenitis suppurativa as the primary indication, but also atopic dermatitis, since it has such a broad enrollment of both Th1 and Th2 inflammatory pathways has been identified as something that is highly relevant. In particular, since we now know that dupilumab is very broadly prescribed when there is a need for biologic treatment. But there are people who don't benefit from dupilumab. And of course, they should have an adequate treatment as well. But in HS, our primary derm indication, the treatment landscape really looks like there is adalimumab and the IL-17 blocker secukinumab, and ustekinumab. And those medicines are reasonably effective. They are administered every week or every second week. But what we believe we can really obtain with this broader mode of action is a higher efficacy and less frequent dosing for the convenience of the patients, and also for the adherence to treatment. So we do want to look at the harder-to-achieve endpoints. We want to use HiSCR 75 because it's more relevant for the patients compared to HiSCR 50; it's really about looking at abscesses and inflammatory nodules, and tunnels in this disease, and it's super painful for them. So the pain of those lesions, this is what we want to go for, and we believe that we can get higher efficacy with less frequent dosing. So we really target the every-second-week dosing regimen in HS. And similar to HS, when we looked at atopic dermatitis, it's clear that there is this very broad activation of the inflammatory pathways. And in particular, when AD becomes more chronic, then there seems to be a shift from the Th2-driven pathways towards Th1, Th2, and 17, where it's also clear that dupilumab is not relevant. It's IL-4 and IL-13. So our exploration of this indication really also looked at the indicators from other single cytokine monoclonal, where it looks like there is an effect, but it also looks like there's a requirement for a broader target of the inflammatory cascades. So the green boxes here are where there have been relevant individual cytokine studies, and where we think there's potential if we target broader. And targeting broader is exactly what we do. So, if we look at the nonclinical data we have and also the ex vivo human data from the Phase I study and from biopsies, it's clear that we do target multiple pathways. We have data from animal peritonitis, animal cardiac inflammation, animal skin inflammation, and lung and skin fibrosis models, and we have the ex vivo human whole blood study and the biopsies. If we look at it cumulatively, all these pieces of information, it's clear that we do target much broader, and we also target at different levels in the inflammatory cascade. So we have CAN10 that blocks 33 and 36, as we have talked about, and also IL-1 alpha and beta, as we have already talked about. But we also have in our heat maps clear indicators that we reduce IL-17, we reduce IL-5, we reduce the infiltration of monocytes, neutrophils, and eosinophils, and T cells. We also reduce the activation and permeability of the endothelial cells, and we reduce the activation of mast cells. So really, all these things with a broad inflammatory involvement in the disease, which gives rise to the itch and the scratching and all the skin lesions. This molecule will really be good for that, even in patients who do not respond to dupilumab. So this is one of the other indications where this molecule has great promise. I think this was my last slide.

That's great. Well, thanks, Morten. Thank you for that very clear run-through of our approach to HS and our newly chosen second indication there of AD. So I hope everybody has seen that the first quarter of this year and the subsequent few weeks have been really rich in data strongly supporting the development of CAN10 in the serious skin conditions, as Morten has just explained there with the rationale for both HS and AD. And obviously, that our Phase I single ascending, multiple ascending dose study has really produced all the data that we could have hoped for that absolutely back up why we have gone into these indications and demonstrate that we can block these cytokines, we can block these immune cells, and we do have great hope of delivering new levels of efficacy, safety and convenience to patients with these inflammatory immune skin conditions and then later, as Morten showed on into other conditions as well. So that's where we will finish the focus on CAN10, and we will now move to talk to of course, or CAN04 IL-1RAP antibody that we've been developing in oncology for quite a long time now, but for which we have now developed quite some substantial data, and we continue to move forward. So in terms of the nadunolimab clinical development, we have announced, obviously, that we have a diagnostic test in development. This is a diagnostic test to be able to identify patients who have different levels of IL-1RAP in their tumors at the start of treatment. What that will enable us to do is to select, as we go forward or enrich, if you like, the studies that we are going to do, certainly in PDAC, pancreatic cancer. Select those patients who have a high IL-1RAP level. So we can treat that subgroup, and that is the subgroup, as I'm sure you will recall, that showed very, very encouraging overall survival data in our previous clinical studies. We'll move that forward, and we're planning for regulatory interactions during 2025. The development of this test does take some time. So that will be the major activity in the PDAC program for 2025. Of course, PDAC is not the only indication that we have looked at with nadunolimab. And indeed, we were very pleased to announce in March that we have completed the recruitment in what is our first randomized controlled Phase II study with nadunolimab, the Trial 4 study in triple-negative breast cancer. The last patients are now under treatment. And we estimate to be able to release the initial results, which will be on the overall response of the patients after 3 months of treatment. We expect to release that in mid-2025. So that's obviously going to be exciting news for the company at that point. And of course, separately, we have announced that we have recruited the first patient in a leukemia study in acute myeloid leukemia and in early myelodysplastic syndromes. This is a study that is taking place at the University of Texas, MD Anderson Cancer Center, and is sponsored by the U.S. Department of Defense. This is a very interesting study in a lot of ways because IL 1RAP itself was first identified actually here at the University of Lund as being present on leukemic precursor cells. So this is, in a way, a little bit of a full circle for the IL 1RAP story and the development of nadunolimab. Of course, we're not full circle because we still have a way to go before we can bring this treatment to patients, but this is a very exciting point in the development of nadunolimab now. We have treated over 300 patients, and we have, as you can see here, different oncology indications and opportunities for nadunolimab to become a new treatment for patients who need these new oncology treatments and to become a multimillion-dollar product and develop value for our shareholders. We have also been presenting posters and having publications published around nadunolimab work and IL 1RAP work. So we presented a very interesting poster just recently at the American Association of Cancer Research Conference of linking clinical data with higher doses of nadunolimab to a reduced instance and the delayed onset of chemotherapy-induced neuropathy, which is an exceedingly troublesome side effect of a number of chemotherapy regimes, which leads to patients discontinuing treatment or leads to patients having to reduce their dose or prolong the interval between treatments. And all in all means that patients are very poorly and are also not receiving their optimal anticancer treatment. So this data is very interesting, and we back this up with supporting preclinical data from mouse models looking at the mechanism of action, which indicates together that targeting IL1RAP with nadunolimab not only has good antitumor activity as we've shown, but also can significantly reduce this chemotherapy-induced neuropathy. And actually, we've also shown that can do that in the context of antibody drug conjugates as well, which are also known to significantly induce these neuropathies. So this is another very interesting set of data to support the development of nadunolimab as we go forward. We also had a publication in Cancer Discovery by Hanahan, followed up actually by a presentation by Professor Hanahan at AACR, where we highlighted the data, our preclinical and translational data identifying the IL-1 family and its signaling as a key driver of cancer-related systemic immune suppression. And these findings really do provide strong support for us in our development of nadunolimab and its potential to counteract tumor-driven immune suppression and therefore, enhance its own activity, but also that of immunotherapy and potentially cancer vaccines also. So all in all, some very, very interesting and strong data around nadunolimab as well since the start of this year. Finally, I want to say a few words to you about our CANXX program. This is based on our library of over 200 IL1RAP antibodies, which we can tune to have different properties and which offer us a number of pathways to value creation as we go forward. And in particular, we have actually published data, a poster at the AACR, also about an anti-IL1RAP ADC. So IL1RAP is overexpressed in many tumors and also in the tumor microenvironment and in the stroma around the supporting tissue, if you like, around the tumor and through the tumor. What we were able to show was our anti-IL1RAP ADC, so an anti-IL1RAP antibody conjugated through a linker to a tumor-killing toxin, but a toxin which you normally cannot deliver because it is too toxic for the body. But if you can make it locate in the tumor through a targeting mechanism, in this case, IL1RAP, then you have very strong potential for treating the cancer. And what we were able to demonstrate was very strong tumor growth inhibition in tumor models expressing both high and relatively low levels of IL1RAP in their tumors. The ADC was also well tolerated in preclinical models, and we showed that adding the ADC function did not reduce the IL1RAP binding that we would look to see. So very exciting data in and of itself, but also illustrating the strength of this platform. So we have, as I said, numerous antibodies with different properties that we can develop into new IL1RAP-based therapies. So not just ADC, but we could look at bispecifics in oncology, but also in immunology, along where we have CAN10. We can look just to develop other of our antibodies targeting different indications. You saw the very large number of indications that the IL1RAP and the IL-1 super family are implicated in, in immunology and autoimmune inflammatory diseases, and we could develop antibodies that are more suited for certain of those diseases than others, for instance. So not only do we have CAN10 and nadunolimab, but now we also have in early stages admittedly but anti-IL1RAP ADC and the possibility to continue to develop other very interesting molecules as we go forward. Finally from me before handing over to Patrik to talk you through the financial figures, are our milestones for this year. So we have already, in Q1, been able to publish the very exciting initial Phase I data with CAN10, SAD, and MAD. We have completed the recruitment of the nadunolimab Trial 4 study, and we've started the investigator-initiated trial at MD Anderson in AML and MDS. As we move through the year, for CAN10, we will fully complete the Phase I study. And later in the year, we will look to file our IND and, subject to financing, start our study. For PDAC, we will provide a regulatory update later in the year. And obviously, as I said, in around midyear, we will have the Trial 4 initial results. And then for CAN10, around the end of the year, we will have the Phase II start in HS and AD, as I just mentioned. So we have an extensive news flow expected during 2025, and this can also be backed up with additional new preclinical and translational results, as well as the type that I've just shown you. So with that, I will hand over to Patrik to take you through our financial results. Thank you, Patrik.

Thank you very much, Damian. And we announced this morning our financial report, which is actually the topic of why we are here today, for the first quarter of 2025. And we started out with R&D expenses at about SEK 41 million, which is slightly higher than we have been trending in the previous quarters, and it's 6% higher than Q1 last year. That increase is driven and reflects a somewhat higher activity in the clinical programs, both CAN10 as well as Trial 4 in adenoma, but also that we have decided to produce more of CAN10 antibodies in order to have that for the Phase II programs. We have already finished the drug products so that we can start the studies according to plan, but we are proactively looking at making sure that we have a buffer of stocks there. On the G&A side, we saw costs of SEK 4-plus million in the quarter. We have implemented a relatively tight cost control, but we saw an increase compared to the same period last year, mainly due to organizational changes. So all in all, our operating loss was at NOK 45 million and the reporting loss at NOK 47 million, and the difference there is reflecting the impact of currency fluctuations, which has a negative effect on our currency hedging accounts. All in all, we also ended the quarter with a cash position of NOK 104 million. We started at NOK 33 million by the turn of the year. We received NOK 107 million in net proceeds from the rights issue that we conducted back in the end of 2024. We had a net outflow of SEK 36 million, which consisted of NOK 34 million in operating cash flow and SEK 2 million in currency adjustments, and that took us to SEK 104 million. Now we estimate that this will take us into Q4 this year in terms of our financial position, but we have flagged that it's not sufficient to fund operations throughout the entire year. We are actively together with the Board, working on various tracks and various transactions, potential transactions, aiming at strengthening our financial position and making sure that we are stronger funded. Those activities include, but not limited to, BD discussions, potential equity raises, and other financial alternatives. With that, I hand over to you, Damian, for closing remarks.

Thank you very much, Patrik. Yes. So, just in closing remarks, it has obviously been a very active and very exciting first quarter and the subsequent few weeks for the company. All of this is taking place against the background of a macroeconomic and geopolitical background, which is exceedingly disfavorable for the whole biotech industry. I think anybody who is invested in biotech companies would be aware of that right now. This doesn't make our job of creating value any easier. But nevertheless, we are working exceedingly hard. We have a number of different tracks ongoing. Business development Patrik, reference, there are also corporate transactions that we are looking at, and other ways to make sure that we can be in a position where we can finance the company and take the company forward. It's always a difficult area to talk about because we cannot give any details for very obvious reasons of confidentiality with the parties with whom we're in discussion. But we continue to move forward. We remain as confident as we can be in the current circumstances. And of course, with no guarantees that we will be able to close a value-creating transaction for the company in the relatively near term. And so they are my final remarks for today, other than to thank you and to thank all of our shareholders for their support. We don't take it lightly, and we're all working very hard to create value for you. But also, we're all driven by the desire to develop new medicines for patients in serious need. And I think you can see that we're making strong progress on that as well, and that is how we will develop value for everybody. So now we can move across to Q&A. Thank you.

[Operator Instructions] The next question comes from Luisa Morgado from Van L Kemp.

Maybe to start out with CAN10. I was wondering, since you're now starting the cohort in healthy volunteers, and the one with psoriasis continues with recruitment. I was wondering when you will share more data, if this will just happen throughout H1 of this year? And then also for CAN10, in terms of the pilot study in atopic dermatitis, could you provide any more details here in terms of trial design, timelines, duration, that sort of thing?

Thanks, Luisa, for your questions. I'll take the first one, and then I'll hand you over to Morten to talk about our first ideas about what our study could look like. But yes, our second multiple ascending dose cohort is fully recruited and is on the study right now and running forward. So we'll expect to be able to announce the data from that before the end of this quarter or around the end of this quarter. Psoriasis is a little more difficult to predict. The enrollment of patients has been stopped, go or subjects, I should say, but the subjects with psoriasis. It's been stopped, and I'll be quite honest, it's not been that easy. It's asking a lot of a person with psoriasis to take part in a study where they need to stay in a clinic overnight, where they're having skin biopsies taken, and so on. But we continue to move that forward and are hopeful that we may get another subject or 2 into that shortly. So I can't give you a time at this point when we can talk about the psoriasis data. But I would just remind you that, that is not on our path to being able to file an IND and move to Phase II. It really is exploratory for mechanistic purposes. So that's the CAN10 Phase I. So Morten, over to you about the AD study.

Yes. On the question of the AD pilot study, I think the question was about timing and trial design, and so on. So what is really important for us is to understand if this nonclinical, you could say, clearly defined mode of action fits AD translates into a clinical effect. And therefore, our first step in it is a small pilot study. So what we really aim to do is to expose around 30 patients with AD for around 16 weeks and then enrich the study with an inadequate dupilumab responder so that we clearly understand whether this translation holds true. Also, the place we are at right now is that we have engaged with a handful of different CROs, which are highly experienced in both HS and atopic dermatitis. And we do right now interact with them on the right study design because the recent years, atopic dermatitis has become increasingly hard to recruit and conduct good studies where we don't get too impacted by the placebo response. So it's critical to understand how we can collaborate with the CROs to make sure that we actually deliver on this small pilot study, while we, at the same time, execute on the bigger HS study. So what we really hope to be able to do is to start the recruitment or start the study at the end of this year, both in terms of the AD study, the small pilot study in AD, and the HS study.

Thanks, Morten. I hope that answers your question, Luisa.

Yes. Very clear. And nice to meet you, Morten. Maybe just one final question from my side, then. So you mentioned the regulatory interactions that you are planning for this year for nadunolimab. Could you just elaborate in terms of what you expect to gather in terms of the conclusion here? And this is not only relative to just the diagnostic test. This is also just for the trial design of CVC.

Yes. Initially, we are looking at discussions around the path to being able to get the diagnostic to a position where it is able to support advanced Phase II/Phase III, registrational-type studies. That's very important, and make sure that we advance that in a way that will be acceptable to the regulatory agencies at the end of the year. Then, yes, of course, as we go further on, we would expect to have some further discussions with the agency around design. We've already had some in the past, some, of course, which came back with answers relevant to Project Optimus, which has made us have to change our plans more than once as we've gone along. And so yes, we'll be having those very important discussions as well in due course.

The next question comes from Richard Ramanius from Redeye.

I had some questions relating to the clinical study, the Phase II study of CAN10. So I guess that's for Morten. Could you say something more about the design of the study, what line of patients use refractory, or patients who haven't undergone treatment before? You mentioned in your presentation that you would use the HiSCR 75, something about your expectations in this, since I know sonelokimab for Moonlake, they made a lot about the, I think it was HiSCR 75, if I remember correctly, which was superior in their Phase II study. So what relative performance would you expect? And also, I may ask it straight away, there have been issues with Phase II studies not translating perfectly into Phase III in HS, and I think in psoriasis as well. Are you taking that into account in the design of the Phase II study?

Should I start answering? So Richard, this thing about the HiSCR, it's an artificial construct because the regulatory requirement, in particular, from the FDA is to use HiSCR 50 in Phase III studies. But what it really is, is that it's a reduction in inflammatory nodules and abscesses of more than 50% if it's HiSCR 50 or more than 75% if it's HiSCR 75, without an increase in either abscesses or fistulas. The thing is that when we explore the efficacy is the delta between the placebo and the active that is important. And it is so in the different trials that it's harder to get a high placebo response in HiSCR 75 because if you improve to a higher degree, then it really requires efficient treatment. So that's the rationale for selecting HiSCR 75. It's really good to see less of a placebo response. But in terms of interpretation, it's the delta between the placebo and the active arm we would be looking for. In terms of moving forward in Phase III at a later stage, we would maybe have to change to HiSCR 50. But for Phase II, the FDA has accepted HiSCR 75 because it is essentially the same construct. Then, about the translatability, I think you would always be concerned about whether it translates into the right effect when you expose the right patients. But I think the best thing we can do in this situation is to understand the disease, and HS is something that really broadly involves inflammatory cascades. And then in the more progressed disease stages, where you get a lot of tissue destruction, it gets even worse. So, in my opinion, I think the broad mode of action is really what makes it super suitable for HS. So I wouldn't be particularly concerned that we don't translate, and in particular, if we can administer the drug every 4 weeks, then I think we are at a good place with this molecule. And then, Richard, you had a third element, I think, but I forgot what that was.

Yes. What line of patient treatment is naive, or if they're refractory?

Yes. So we want to include both. And we have proposed around 30% who is treated with prior biologics, either TNF alpha or IL-17 and then 70% who are naive to make sure that we, in the Phase II study, get data indicating effect on both, whether they have been treated with prior biologics or whether they are biologics naive. Yes. And then your last question was about the expected level of effect in the HiSCR 75 of this drug. I would say that at least 40%, if we look at an expected placebo of 20%. So we would have at least double the number of responders.

If I could just add there, Richard, I can say our ambition clearly is to get HiSCR 75 at a higher rate than the existing treatments. And we think the mechanism of action that we have, this broader mechanism of action, gives us every chance because we hit more of the pathological processes of HS than the single pathway blockers do. So yes, that is the minimum that we expect to see, as Morten has just said, but our ambition is to be certainly better than existing treatments.

So let's say, if you achieve these results, how would that translate into product placement? I guess it would be difficult to get it in the second line in that case? Or if you get a really great score, would that be possible?

That's a really good question, Richard. It crosses over into a whole number of subjects, such as reimbursement, which is different in different countries, and pharmacy benefit management and hospital formularies, and so on. But the general expectation is that a lot of patients, unless your data is absolutely incredible, a lot of patients will, first of all, get generic biologics, so TNFs, before they move on to the newer biologics afterwards, and that is just simply a case of cost control. But the indication would be that we would go for obviously, depending on the data. But given the population that we plan to use in Phase II, Phase III, the indication would be to be able to treat both biologically naive and refractory patients down the line.

Let's see, I had some more questions about nadunolimab, what Phase II activities remain before you can, or let's say, preparatory activities remain before you can start a Phase II study. You mentioned you have produced substance. Are you doing long-term toxicology studies or other activities?

Yes, there is a toxicology study, which needs to be completed and reported out, and that's on the same time frame as the Phase I study. So that is the other key activity. Then, as we continue to move forward, there will be continued drug product and drug substance, and drug product. manufacturing. But in terms of the actual activities to get to the trial, it is getting the relevant amount of drug product in place to get underway and to ensure we can have continuity of supply. And for the IND, it's to complete the Phase I study and wrap up, and report the toxicology study that is a prerequisite.

No, you're right. This was about CAN10, my mistake. But you gave the right answer. Now my question about nadunolimab -- my question was, when do you expect the results from the leukemia study?

Well, that's an investigator-initiated trial. So it is not under our direct control. But we are expecting it to take about 2 years for that study to produce results.

The next question comes from Sten Westerberg from Analysguiden.

Congratulations on a very productive quarter. Two questions on CAN10. First, if you can break up the expansion of the Phase I trial a little bit more. If originally estimated at enrolling 80 patients and now enrolling up to 116, it's quite a big expansion for a Phase I study in my mind. Is this entirely related to the SED group? Or have you made changes in the other groups as well? That's my first one. And also on the pharmacokinetics of the molecule, will you have to give a loading dose of CAN10 in Phase II? Or will you directly move into a 4-week dosing schedule? These are my 2 questions.

Thank you, Sten, and thank you for your kind remarks at the start. In terms of the Phase I study and the enlargement of that study, that was undertaken mainly to add single ascending dose groups to the study so that we could go higher in concentration or higher in dosing, I should say. Because eventually, we want to have the highest therapeutic window we can and make sure that we can deliver fully effective doses to patients. So, given how very good the tolerability was, we added more groups to the study. I might ask Patrik, as he has more corporate memory than both Morten and myself, who are recent arrivals, if he has any extra details to add.

No, that's absolutely true, but we also added MAD cohorts to explore exactly, as Damian said, to explore higher doses. And that's particularly because we saw that in general, other competitors were actually dosing higher in HS than in other diseases. So we wanted to have the freedom to give the right dose levels in Phase III patients in HS.

Thanks, Patrik. As you can hear, Sten, our Chief Financial Officer, has a much wider view of the company than many Chief Financial Officers do. Absolutely. And sorry, Sten, if you could remind me of your second question?

Yes. It would be interesting if you will need a loading dose of CAN10 in future studies, or if you can move directly into the 4-week dosing schedule?

Yes, to ensure that we get as quickly as possible to the steady state pharmacokinetics, and make sure that we're always above that C trough level that I referred to. We will use one loading dose at the start of treatment in Phase II.

One loading dose?

Yes. So to be clear, that would mean patients who get the dose, a 2-week dose, a 4-week dose, and then afterwards, every dose would be every 4 weeks in the Q4W arm, yes.

Yes. So I understand there will be a loading phase in the study.

Yes, exactly. One loading dose.

In the ADC field, there appears to be a lot of activity from all parties involved in oncology drug development. Can you provide us with any more future plans or directions for your own preclinical programs? Will you be able to come up with the CD anytime soon? Or what are your plans in this interesting field?

At the moment, we're at very early stages. We have just done this early work that we've just published. So we're some time yet from designating a clinical candidate and then moving forward into pre-IND studies. But on the other hand, the program has attracted some attention. You may also be aware that Pfizer published an IL-1 RAP ADC poster at the AACR at the same time as we did our paper. So you can see that there is industry interest in this area, and we would be very happy to have a collaboration with somebody around this for sure.

No more phone questions at this time. So I hand the conference back to the speakers for any written questions or closing comments.

Yes. The first written question is, how does the blocking of IL-1 beta relate to the blocking of IL-1 alpha? Morten, do you want to take that one?

Yes. But maybe I don't know if we could show the slides again, there is one which really explains it quite well, Slide #8. Yes. Okay. Cool. Yes. So obviously, our nonclinical team and the CMC guys are much better at explaining the science of this. But if you look at the small yellow thing in the middle of the 2 parts of the IL-1 receptor complex and also IL-33 and IL-36, then the thing is that putting it there blocks both alpha and beta in terms of the IL-1. So you could say, how does it relate? It relates in this way that it blocks both IL-1 beta and IL-1 alpha.

Exactly, Morten. And also, as you said briefly there, it blocks IL-33 and it blocks all of the IL-36 isotypes as well. The only reason we don't have data is that there isn't a whole blood ex vivo inhibition assay for IL-1 alpha, and that's why we haven't actually got data that we can show you. But that is the way mechanistically that this works.

And the last question is related to the CAN10 program. How will you finance the next phase of that program?

I hope I discussed about earlier, and Patrik discussed as well, we are looking at a whole range of ways of getting finance into the company, principally through business development and corporate transactions, but we are also looking at all other options as well. It's quite clear at the moment that we can't finance it, but we are as confident as I've said, as confident as we can be in the current circumstances, and with no guarantees that we will be able to close the transaction that will allow us to move our programs forward.

Thank you. And that was all the questions coming in from the web.

Thank you, Jonas. So on behalf of Patrik, Morten, and myself, I'd like to thank everybody who's dialed in and listened today. I hope we've given you a good update about where we are and where we're going. And we thank you very much indeed for your interest and your support, and we hope to repay that to you as soon as we can. Thank you very much.