DiaMedica Therapeutics Inc. (DMAC) Earnings Call Transcript & Summary

Good morning, and welcome to the DiaMedica Therapeutics Virtual KOL event. [Operator Instructions]. As a reminder, this call is being recorded, and a replay will be made available on the DiaMedica website following the conclusion of the event. I'd now like to turn the call over to Rick Pauls, President and Chief Executive Officer at DiaMedica Therapeutics. Please go ahead, Rick.

Good morning, everyone, and thank you for taking the time to join our call today. We sincerely appreciate your interest. We've organized this event because in the coming weeks, we expect to share data from our ongoing investigator-sponsored clinical trial in preeclampsia. With so few therapies currently in development, we felt it was important to provide investors and others interested a chance to better understand the impact of preeclampsia on women and their unborn babies and why it remains one of the most significant unmet medical needs today. With May being National Preeclampsia Awareness Month, the timing of this discussion feels especially fitting. Most people have heard of preeclampsia, but it's still a major gap in understanding its underlying causes and how it's currently treated. One of our key goals today is to help close that gap by shedding light on the disease and the limited treatment options available. We'll also walk through the efficacy and safety thresholds we believe are clinically meaningful in Part 1a of the ongoing Phase II study, not just from a scientific perspective, but in terms of real-world impact on patients. Prior studies have clearly shown that DM199 can significantly reduce blood pressure. Reducing blood pressure in preeclampsia patients is critical to improving outcomes for both mothers and their babies. And today, we'll discuss what clinically meaningful data really means. We'll also explore the potential of DM199 to dilate the intrauterine arteries, which would increase blood flow to the placenta, which could be disease-modifying and lead to larger, healthier babies. Also, a key safety advantage of DM199 is that it is not expected to cross the placental barrier or, if it does, only in minimal concentrations, unlike small molecules that passively diffuse and reach the fetus. Thus, if we can safely show meaningful drops in blood pressure and possibly also dilate the intrauterine arteries, we believe it could represent a transformative moment, paving the way forward in our clinical development path of DM199 for what could one day become the first FDA-approved treatment for preeclampsia. Now I'm honored to introduce our 3 distinguished OB/GYN physician speakers joining us today. Let me introduce them in the order that they'll be speaking. Dr. Baha Sibai is a world-renowned maternal fetal medicine expert, a professor at the University of Texas Health in Houston, and Director of the nation's largest maternal fetal medicine fellowship. Professor Sibai is a world-recognized expert in maternal-fetal medicine with a specific focus on the study of hypertension and preeclampsia. He has published over 650 peer-reviewed articles, led NIH-funded trials, and are major honors, including the SMFMs Achievement Award and the ACOG Hall of Fame All-Star status. Dr. Sibai will offer his perspective on the current clinical challenges and the high unmet need in preeclampsia patients. Next, Dr. Stephen Tong is a clinician-scientist at Mercy Hospital for Women and the University of Melbourne. He's also listed as one of the top 10 preeclampsia experts in the world by ExpertScape. Professor Tong currently serves as the Co-Director of Mercy Perinatal and has led global clinical trials for preeclampsia pregnancy treatments. With over 250 publications, NHMRC fellowships, and major grants, he is a leader in maternal-fetal innovation and diagnostics. Dr. Tong will discuss the evolution of preeclampsia and how DM199's mechanism of action could break new ground as a potential treatment for this very serious unmet medical need. Then Dr. Sue Walker is Head of the Obstetics and Gynecology at the University of Melbourne. She leads the Perinatal Medicine at Mercy Hospital and Victoria Fetal Therapy, a renowned expert in fetal growth disorders, preeclampsia, and stillbirth prevention. She has over 250 publications, major NHMRC funding, and co-chairs the RANZCOG committees. Dr. Walker will review the limited treatment options currently available and walk us through the design of the ongoing preeclampsia clinical trial. Following their presentations, we will open up the floor for a Q&A session. Please also note that some of the images that will be shared today are clinically graphic in nature as they depict real cases of preeclampsia and its consequences. They are being shared to underscore the seriousness of this condition and the urgent need for effective treatment options. So with that, let's begin. Dr. Sibai, could you please start us off?

You're on mute, Dr. Sibai.

Good morning. My name is Baha Sibai. And today, I'm going to go over some of the unmet needs in preeclampsia. First, the condition is a life-threatening high blood pressure disorder that occurs only during pregnancy and in the postpartum period. It affects somewhere about 5% to 8% of all pregnancies in the United States. And this rate is increasing about 180,000 to 300,000 pregnant women will have the condition every year. The hallmark for the diagnosis of preeclampsia is elevated blood pressure that occurs after 20 weeks gestation and in association with other organ abnormalities. One of them is the sudden spike in blood pressure that causes seizures, stroke, multiple organ failure, and even that for the mother and the baby. Also, you'll see excess protein in the urine, a decreased activity of liver function, fluid in the lungs or pulmonary edema, fetal growth restriction, hypoxia, and stillbirth and decreased levels of platelets in the blood known as thrombocytopenia. At the present time, the only cure for preeclampsia to stop the disease is to deliver the fetus at the placenta, often leading to premature delivery. Next slide. The management of these patients, usually, we give them steroids, control maternal blood pressure, give medication to prevent seizures, and deliver the baby. However, even after delivering the baby, despite the use of steroids, there are still significant morbidity that affects these babies; bleeding in the brain known as intraventricular hemorrhage, bleeding in certain vascular [indiscernible] known as periventricular leukomalacia, necrotizing enterocolitis, this is a condition that affects the bowel of the fetus and [indiscernible]. In addition, these babies will require long-term ventilatory support as well as develop a condition known as bronchopulmonary dysplasia. This condition will have clinical application long term for the baby, months after delivery, or the baby could die. Even when the babies survive, they are more likely to stay a significant number of days in the intensive care unit. And once they leave nursery, they're going to have significant long-term morbidity, including hearing disorders, visual disorders, cerebral palsy, and neurologic deficits. Next please. There is no doubt both mortality for the baby as well after the baby surviving having significant neurologic morbidity is depend on gestational interval. Babies delivered at 24 weeks have almost 50% chance of dying, and many of these, even if survived, will have long-term deficits. As we improve gestational age on a weekly basis, this transfer into a significant reduction in the likelihood of the baby dying as well as the likelihood of the baby surviving without significant morbidity. And this is why extending or prolonging gestation, this early in pregnancy has significant clinical implications whether the baby is going to die and whether the baby is going to have a long-term morbidity. All of these cost a huge amount of money as it relates to the days spent in the intensive care unit plus long-term application to take care of a baby that has problems with their hearing, problem with their lungs, having cerebral palsy as well as having problem with their vision. Next slide, please. Listed here the rate of these complications that have a huge economic impact, as well emotional and psychological impact, that the family and more importantly, the cost for the whole to the cost of the health system. Respiratory distress syndrome is one of the most significant complications, bronchopulmonary dysplasia, necrotizing enterocolitis. This is a condition that affects the intestine of the baby, and breathing in the baby's brain are all significant complications, and babies born at 24 to 28 weeks gestation. This is why prolonging gestation at this gestational age has significant implications. Next please. In addition, the rate of long-term deficits in infants born at less than 28 weeks include cerebral palsy, and this is a condition that affects really the baby all their life and has implications regarding cost as well problems and impact on the family as such. Then impaired vision and impaired neurological deficit, and more importantly, 40% of these babies will be disabled. Next, please. When we try to prolong gestation, and this is what we call expectant management. This is a protocol I really introduced more than 40 years ago. And this is very important. Any time we try to expect a management with trying to prolong gestation. And this is really for fetal benefit, but that has significant risk to the mother. And these problems include pulmonary edema, a woman developing DIC where they can bleed to death, developing a condition called Harp syndrome that affects the maternal liver and leading to other several organs such as the kidneys, the brain in the form of stroke, and eclampsia where these women could have seizure. In some situation, this will lead to maternal death. Next please. This graphic again, have listed to you some of the cases I have seen over the years regarding complications in the mother when we try to prolong gestation, and this includes really bleeding in the brain. And this could be in various areas of the brain. Some of them may be fatal, and some of them will lead to long-term deficits, development of seizures. This is a patient where you have got biting of the tongue, significant bleeding in the brain, involvement of the liver, where patients could have subcapsular liver hematoma, bleeding from everywhere, developing of abruptio placentae, which is premature separation of placenta. This will lead to fetal hypoxia and probably fetal death, and also will lead to patients have significant and major bleeding, including development of [indiscernible] and the need for multiple blood and blood products. This is how a liver hematoma looks at surgery, also involve development of a condition in the brain that is similar to stroke and having fluids in the lung. Next slide. In addition, there are a lot of things that happen when this condition develops very early in pregnancy, particularly when it is associated with fetal growth restriction. This is a baby that developed fetal growth restriction at 25 weeks after we spent a lot of time effort trying to prolong gestation and ended up having dying in the intensive care unit at the age 276 days. This is another baby that survived at 25 weeks IgAN, and at that time, it was 3 years old. However, this baby is having significant neurologic problems and pulmonary issues despite the fact that the baby is still alive. This is a baby, despite all of our efforts, ended up dying. So these are really just an example where this condition happened very early gestation, how it affects the fetus, whether the fetus is going to survive, and if the baby survives, what are the implications for the baby. Next, please. Again, this is a graphic of the patient. And as you know now, we are seeing more of these conditions, particularly as women really are delaying pregnancy to later maternal age, and with the impact really of obesity, a lot of women are having infertility problems and getting pregnant by IVF. This is a patient that had dementia. She developed severe IgAN at 23 and 4 days and was able to prolong her gestation by about 9 days. However, she [indiscernible] delivery because she had a health syndrome, the baby was born at 470 grams. Unfortunately, the baby died in the intensive care unit at 14 months. Next, please.

All right. Thank you. So I appreciate that a very important overview. We'd now like to turn the call over to Dr. Tong to talk about how preeclampsia evolves and the mechanism of action with DM199.

Well, thank you very much, Rick. So my name is Professor Stephen Tong, and I'm based in Melbourne. So first, I'd like to start by explaining how preeclampsia arises. And there are 2 stages in its evolution. Stage 1 of preeclampsia occurs in early pregnancy during the first trimester. In normal pregnancies, the early placenta embeds in the lining of the uterus. It drastically remodels or renovates the blood vessels in the uterine walls called the spiral arteries. Placental cells widen these spiral arteries by a massive 5 to tenfold, and this promotes plentiful blood flow to the placenta, providing it with all the oxygen and nutrients it needs to grow a healthy baby. But in preeclampsia, this all goes awry. The pre-eclamptic placenta fails to embed properly in the wall of the uterus. The spinal arteries are not properly remodeled. They fail to widen. The blood vessels supplying blood to the placenta remain narrow. The flow of blood, oxygen, and nutrients to the placenta is dangerously reduced for the rest of the pregnancy, and such early events sets the stage for preeclampsia. Stage 2 of preeclampsia occurs after the 20 weeks of pregnancy. The stressed placenta, chronically starved of oxygen, releases noxious factors that spread through the mom's circulation, and these inflict widespread damage to her blood vessels. An important example of such a noxious factor is the anti-blood vessel protein called sFLT1. But the placenta also releases many other factors aside from sFLT1 that are highly damaging to blood vessels, such as pro-inflammatory cytokines and molecules. And the damage caused by these noxious factors on the maternal circuitry system is a pathological process known as endothelial dysfunction. Blood pressure rises sharply, and the vital organs supplied by these blood vessels do not receive the oxygen or nutrients they need. These organs in the mom then become dangerously sick. Brain injury can lead to stroke. The lungs can dangerously fill with fluid, compromising breathing. The liver can rupture, the kidneys can become sick, leak protein in the urine, and the kidneys can even fail. And once preeclampsia takes hold, there is no drug that can slow the disease progression. The only option, as Dr. Sibai mentioned, is to deliver the placenta. And as Dr. Sibai said, at preterm gestations, this can inflict severe prematurity on the baby, beautifully presented by him just to show really the real terrible health impacts arising from needing to deliver the baby at a preterm gestation. So I'm now pleased to explain the exciting potential of DM199 to be the first breakthrough treatment for preeclampsia, why DM199 could be the ideal drug treatment for preeclampsia, and why DM199 may be a drug in a class of its own. So the diagram on the left is a cross-section of a blood vessel, sort of a cross-section of a blood vessel. And the outer layer is the vascular smooth muscle. The inside is where the blood flows, and the yellow rim is the single layer of endothelial cells, the inner lining of blood vessels. The middle picture zooms in on the endothelial cell layer. Bradykinin is a peptide in the bloodstream. Bradykinin, which is a short chain of amino acids, binds to and activates its receptor called the bradykinin 2 receptor on the surface of those endothelial cells. And this switches on internal molecular circuitry within the endothelial cell that activates all 3 of the main pathways involved in reducing blood pressure, nitric oxide, prostacyclin, endothelial-derived hyperopolarizing factor. And these molecules filter into the underlying smooth muscle layer of blood vessels and make muscles relax. Blood vessels widen, blood pressure falls, and the amount of blood flowing through the vessels increase, supplying distant organs with the oxygen and nutrients they need. Hence, bradykinin signaling would be a really useful strategy to treat preeclampsia. But the problem is bradykinin only has a half-life of seconds. If you inject it intravenously, it would disappear before it even reached the top of the arm. So DM199 made by DiaMedica Therapeutics, is a protein that circulates in the bloodstream with a far longer half-life than bradykinin. Its function is essentially to make bradykinin. Hence, DM199 facilitates bradykinin signaling to reduce blood pressure and open up blood vessels. DM199 is simply a synthetic version of a natural protein called tissue kallikrein 1, but with slight modifications to enhance its stability. Being simply a drug version of a naturally occurring protein offers a critical advantage. It means that we already have 2 decades of biological research detailing the potential of tissue kallikrein 1 or DM199 to promote blood vessel health, and it all points to DM199 acting in 2 places to combat preeclampsia, mom's blood vessels, and maybe in the uterus itself. First, mom's blood vessels. Next slide. So I refer you to the diagram on the right. As mentioned, DM199 might powerfully act to reduce blood pressure and open up blood vessels. Furthermore, research in the natural version of this molecule, tissue kallikrein-1, suggests that DM199 may have actions to reduce that endothelial dysfunction, and it can essentially restore blood vessel health beyond mere blood pressure reduction. So I'll just give you one such example of many. So DM199 might have a pretty interesting effect that it may overcome the adverse effects of that molecule called sFLT1. So as I mentioned before, sFLT1 is a disease driver of preeclampsia. It's released from the disease pre-eclamptic placenta in very high amounts, and it prevents a receptor called VEGF receptor 2 from switching on, and that's bad because VEGF receptor 2 is a good guy. Its molecular role on the endothelium is to promote blood vessel health. Remarkably, it's likely that DM199 can relay signals inside the endothelial cell to switch VEGF receptor 2 back on. And if this is true, then DM199 may remarkably overcome the effects of this FLT in preeclampsia to restore blood vessel health. But aside from its many positive actions on the lungs' blood vessels, we think DM199 may have an important bonus action. DM199 may act within the uterus to stop preeclampsia at its source, and I now refer you to the diagram on the left. So placental hypoxia or low placental oxygenation is a key feature of preeclampsia. It's possible DM199 can open blood vessels in the uterus itself. If so, this could increase oxygen to the placenta, reducing that placental hypoxia. And reducing placental hypoxia will stop the excess release of the noctis factors, causing the maternal vascular injury of preeclampsia. Thus, DM199 has the potential to switch off the release of those noxious agents right at its source, the placenta itself. And in actual fact, we can test this premise in clinical trials. Doppler ultrasound can measure blood flow in the uterine arteries, and these are the big blood vessels supplying blood to the uterus and the placenta. In preeclampsia, in the clinic, Doppler ultrasound readily reveals increased blood flow resistance in these uterine arteries, suggesting that blood flow to the placenta is reduced. If DM199 can dilate blood vessels within the uterus, we can actually measure this by Doppler ultrasound. We could show, for instance, that giving DM199 reduces uterine artery blood flow resistance, meaning there's improved blood flow to the placenta. Hence, if I can summarize the potential biological actions of DM199 to treat preeclancy may be to powerfully reduce blood pressure, to open up blood vessels supplying more blood to mom's vital organs, to restore the health of maternal blood vessels generally by reducing endothelial dysfunction, plus the enticing possibility exists that it could increase blood flow to the placenta, stopping preeclampsia at its source. DM199 could be a revolutionary treatment that slows, stops, or even reverses the preeclampsia disease process. And if so, it could save a lot of lives. And for example, when preeclampsia occurs at an early preterm gestation, Dr. Sibai has beautifully outlined the case that we often need to deliver the placenta and baby preterm to save the mom. But this inflicts all those nasty, terrible effects of prepaturuory on the baby or those poor neonatal outcomes, which were described before. But if DM199 can wash the damage caused by preeclampsia, it could be given to women with preterm preeclampsia to safely prolong the pregnancy. And if -- with pregnancy prolonged, the baby could be birth at a less preterm gestation, dodge all those poor neonatal outcomes associated with being born premature, with better lifelong outcomes. So finally, I want to tell you the potential point of difference of DM199 noted by Rick before. But it is a trait that no other drug proposed for the preeclampsia possesses, as far as I know. The placental barrier is the surface of the placenta and keeps the maternal and fetal circulation separate. It tightly regulates what gets through the placenta and into the developing fetus, what gets in, and what stays out. Small molecules, for instance, passively diffuse through the placental barrier just like sugar through a sieve. And most drugs are small molecules. For instance, all those off-the-shelf tablets that you might just get at CVS Pharmacy, they're all small molecules. And nearly all drugs given during pregnancy, and I suppose, outside of pregnancy, are small molecules. Those tablets are all small molecules. The issue then for small molecules is that it may enter the unborn baby, where there may be a potential health risk. But in contrast, DM199 is a protein, and proteins cannot breach the surface of the placental barrier, a continuous border of cell membranes. Proteins are just too big. So it's just like adding whole almonds to a sieve; they just won't pass through. Hence, being a protein, DM199 will likely stay out of the placenta. It will never reach the fetal circulation. And if so, this could wipe away teratogenic concerns and any other concerns arising from direct fetal exposure. So DiaMedica to look into this commission rodent placental transfer studies. And these studies, the diagram on the right shows a nice rise and fall of DM199 in the maternal circulation, but DM199 remain undetectable in the fetal circulation. The implications if DM199, in fact, stays out of the fetal circulation is perhaps pretty extraordinary. It means that DM199 may possess the near-magical qualities of having multiple actions to treat preeclampsia without even needing to enter the placenta, the very organ causing the disease. And that's why we would argue that DM199 seems to be a drug in a class of its own. Hence, DM199 has the potential to be an ideal disease-modifying drug for preeclampsia. We, therefore, think DM199 is well worth evaluating in human clinical trials, and it just might represent a breakthrough drug that ends up saving a lot of lives. Thank you.

Great. Thank you, Dr. Tong. That was a great overview. Next, I'd like to turn the call over to Dr. Walker, who's going to talk about the current limited treatment options and also a high-level review of our -- of the ongoing Phase II clinical trial.

Well, thank you, Rick, and good morning, everybody. So where are we in 2025? So we've heard from Dr. Sibai about the disease burden of preeclampsia and the risks to the mom as well as the risks to her baby, particularly among those born severely preterm. Stephen has beautifully walked us through how the placental toxins cause and then amplify the disease process, which is characterized by endothelial dysfunction, causing hypertension and end-organ disease. And we've heard why DM199 is particularly attractive as a novel treatment given, firstly, its action is on the end target of those toxins, the endothelium, and secondly, that it's not expected to cross the placenta. So what are our current treatments for preeclampsia? Well, we don't really have one. As Dr. Sibai has said, we remove the source of the toxins, the placenta, and with that, the baby, sick, small, ready or not. The medications that we give in 2025 are to prevent the complications of the disease process rather than to address the disease process underlying it. So the first panel that you can see there are the antihypertensive. So we protect the mom from dangerous blood pressure spikes, for example, that can cause stroke with blood pressure drugs, alpha and beta blockers, or calcium channel antagonists. And while they control blood pressure, these agents don't improve endothelial health. The second row you can see there is that we give antiseizure medications, particularly magnesium sulfate, to reduce the risk of mom having a FSH or eclampsia. As you've heard, one of the most serious complications of preeclampsia. And then in the final row, you can see that if we have time, we do all we can to get the baby ready for premature birth by administering corticosteroids, which reduce the risk of complications from prematurity that Dr. Sibai has outlined to you, respiratory distress syndrome, intracranial hemorrhage, neonatal death, long-term morbidity. If I could have the next slide, please. But these approaches really are insufficient. The data that I'm showing you here is from the PRESERVE trial, a trial, in fact, led by Dr. Sibai in an American network involving over 26 centers. And the PRESERVE trial investigated the role of a new agent to improve pregnancy outcomes in women between 23 and 30 weeks with preterm preeclampsia. So this trial gives us really contemporary data on what we call latency, the time to delivery from diagnosis until delivery, and the indications for delivery in preterm preeclampsia in America today. Now, the medication that was trialed didn't demonstrate any benefit, with the time to delivery about 5 to 6 days, and the babies were born very preterm. But you can see here in the highlighted yellow row that even with access to modern antihypertensive treatment, refractory hypertension was the leading precipitation for delivery in both arms of the trial, and this occurred in about half of the patients. So I guess what this illustrates to us is we have a gap in achieving adequate blood pressure control for these patients with the current treatments I've described. And the result is that we have an unmitigated risk to the mom of uncontrolled blood pressure and more preterm birth risks to the baby. If I could have the next slide, please. And so I would suggest to you that the gap that we have here is the endothelium. So let's look at some of the existing treatments for blood pressure. So antihypertensives currently used in pregnancies, such as nifedipine, work by causing smooth muscle relaxation, which lowers blood pressure by dropping vascular resistance. Agents like labetalol also drop vascular resistance and have an additional effect modifying heart rate and cardiac output. But neither of these agents targets the endothelium, which, as Stephen has described, is the final destination of the toxins being released by the preeclamptic placenta, the endothelium being the master regulator of blood vessel health and function. And what we've heard is that DM199 has multiple actions, which address endothelial repair as well as blood pressure control through smooth muscle relaxation. Next slide, please. So the question is, where do we take this to? Well, we need to take it to a clinical trial in pregnant women, and this is what's currently underway in our collaborative effort in Cape Town, South Africa. Next slide, please. So the first step in the first human trial in pregnancy is finding what is the right dose. And to do this, we're recruiting women with preeclampsia who have been determined to require delivery. These are women who are anywhere between 27 and 42 weeks who have severe hypertension, so more than 150 on 110, and they've been scheduled for delivery within 72 hours. And you can see here these rising blocks are showing that we're currently doing a gentle and steady dose escalation involving 30 patients and to achieve an adequate blood pressure response. We are currently at strata 8. So our primary endpoints from this -- beginning this early trial, the dose escalation, the dose finding trial here are, firstly, safety and tolerability. They're the most important outcomes in these early-phase trials. So in terms of safety and tolerability, we're looking for a drop in blood pressure. But importantly, we are also doing cord blood assays of DM199 to ensure there's no transplacental passage. And then we have exploratory outcomes. These are, as Stephen has mentioned, looking at the uterine artery blood flow with Doppler assessment and other measurements, including the levels of pathogenic toxins such as soluble FSH and biomarkers of end-organ dysfunction, such as the creatinine, which is a measure of renal function. And once we've reached the optimal dose, we will then do an expansion cohort on a further 30 patients. If I could have the next slide, please. So perhaps if I could just summarize the key endpoints for the current study. The first thing is that we're looking at placental transfer. So, we're getting cord blood at the time of delivery to ensure lower undetectable levels of DM199, indicating that there hasn't been crossover through the placenta and going into the baby's bloodstream. And as Stephen has said, if this is confirmed, this will be a significant reassurance. It's a highly significant safety signal that really can't be claimed by other small-molecule therapeutics, which filter freely across the placenta. The second primary endpoint is achieving blood pressure control. Now this is crucial. As we've seen in the PRESERVE trial that I presented, uncontrollable blood pressure is the single most common reason for abandoning expectant management and proceeding to preterm delivery. The pathways by which DM199 acts on the endothelium master regulatory system strongly suggest it could result in durable and sustained blood pressure control. And then finally, we have our exploratory endpoint, which is the uterine artery Doppler measurement. This measures the resistance to maternal blood flow by the placental bed. High uterine artery resistance indicates poorer placental perfusion associated with fetal growth restriction and preterm birth. If uterine artery resistance drops, it suggests that DM199 may increase placental perfusion, meaning it can potentially ameliorate both preeclampsia and fetal growth restriction at the source. So that's a bit of an overview of where we are and where we're going, and I'd like to hand back to Rick.

Great. Thank you, Dr. Walker. That was a very valuable overview. Tara, could we please open the line to the first question as we start off the Q&A session?

So please hold for a brief moment while we poll for questions. So, our first question comes from Thomas Flaten at Lake Street.

Thank you, and thanks to all the doctors for joining this morning or this evening if you're in Australia. Dr. Walker, just following up on your last slide about the endpoints. I'm curious, given that KLK1 is an endogenous molecule, is there a larger safety margin if some of DM199 were to transfer through the placenta? Or is 0 the only number that would make sense from a safety perspective?

Well, look, thanks for the question, Thomas. Obviously, what we would like to see is very minimal or no transplacental transfer. But I don't think that it needs to be 0 necessarily. I don't think that we would consider that a physiological molecule like this would necessarily mean that we couldn't be continuing to use DM199. But I think we really have to gather the data first to try and get the indication of what transplacental passage there is. As Stephen has said, I guess there's a couple of things about transplacental passage. The first thing, of course, we all think about, I guess, in the lay audience is we think about things like thalidomide and causing birth defects. Now don't forget, we'll be using DM199 in a later gestation beyond the period where all the baby's organs have been made and matured. So, we're not thinking about using it in the first. We've got no reason to think that it will cause any of those problems because of all the reprotox studies that have been done. But nevertheless, we'll be using it at a later gestational age. And as you say, because it is a physiological molecule, we would just want to keep a bit of an eye on things like the blood flow patterns and the hemodynamics of the fetus and the newborn after birth. And fortunately, in the early studies that we've already developed and are already underway, we are already doing a comprehensive evaluation of not just the maternal uterine arteries, but also all of the fetal vasculature. So, this means we'll be able to look at things like umbilical artery blood flow, blood flow in the brain, blood flow in the heart and the liver and so forth, which I think then will be able to give us a very reassuring signal that we are not seeing changes in response to medication even if it were to cross. But of course, what we're really hoping for is that we'll see that there's no or minimal transfer on those very first cord blood samples.

Super helpful. And then just sticking with the endpoints, I guess, for whoever. To the point Rick made at the beginning, the investment community isn't really that familiar with preeclampsia drugs because there haven't really been any. But with respect to lowering blood pressure, obviously, in Part 1a, you're looking at women who will be delivering within 72 hours. So, the acute lowering of blood pressure is important. But what I'm curious about is, is there a definitive endpoint you need to get to? Or is it just an absolute drop? So, do you have to get below 130, for example? Or is that 20-point absolute drop sufficient regardless of where you started from?

Yes. Thanks, Thomas. That's a good question. Maybe what we actually can do is if we could advance, last year we provided a summary of what we thought would be clinically relevant data. Maybe if we could just jump to Slide 31. So, here's a summary of what we identified as the study was starting here in terms of what would be clinically meaningful results. Dr. Tong, would you mind just taking us through here in terms of blood pressure reduction and what you see as clinically meaningful?

To answer Thomas' question, and thank you for the question, we recruit women where the blood pressures are really acutely very high. So just getting it under the threshold, which we would suggest a very high stroke risk, getting it under systolic 150 and getting it a diastolic well under 110, and hopefully under 100 would be an important goal. So, I think the first is a relative drop from what we would call where clinicians would think would be a very dangerous level to a much more safer zone would be clinically relevant rather than always be a number. But just on average, we would suggest that what it may represent is something a bit like exactly as shown on the slide, a systolic blood pressure drop of 10 millimeters of mercury or a little bit more, and a diastolic decrease of 5 to 10. But what we hope to see is a consistent reduction in blood pressure of around those numbers with the administration of DM199, and a reliable expected drop of blood pressure with administration of the drug. I might also just reiterate that while these first studies, the early efficacy point we're looking at is blood pressure reduction, what I suppose excites me the most as a clinician scientist, which is the fact what it represents. A drop in blood pressure means that the drug is acting on the endothelium as we had expected. So, the anticipated benefits of that go well beyond just blood pressure reduction. It may suggest that the blood vessels are getting healed. You should be able to see all those benefits of reduction in endothelial dysfunction. So, we're healing the blood vessels of the mom by giving this drug. And if you get one readout being a reduction in blood pressure, it would suggest plausibly that the biological machinery and the molecular mechanisms that you would expect DM199 to switch on are being switched on to plausibly infer that there would be a rescue in endothelial dysfunction and an improvement in blood vessel health of the mom.

Dr. Tong, can you just expand a little bit here? So, in our current ongoing study, we've got 3 patients per cohort. I mean, how many patients would you want to see this 10-plus point drop in systolic blood pressure?

Well, as we increase the dose, we would hope to see essentially on upper doses, we would want to see a majority drop the blood pressure.

And then -- sorry, Rick, one final one, I'll jump back in the queue. Dr. Sibai, you showed some relatively disturbing imagery of these poor young children. I was just curious, looking at that, there was one child you had in the NICU for 267 days. I don't know if you can, but can you enumerate for us what the cost of managing children in the NICU is long term?

Yes. I think when we talk about the cost, we talk about what I call the acute cost and the long-term cost. For the acute cost currently in the United States, the average cost for babies that on this early is probably somewhere between $5,000 to $10,000 a day. If a baby stays 3 months or 4 months, and some of these babies celebrate their 1 year while they are in an ICU, we are talking about $2 million to $3 million for the bill for the acute care. Then you add to this the long-term implications if these babies survive, which might be in the millions because these babies might be wheelchair born, they cannot walk, [indiscernible], some of them need some respiratory support, treatment of seizures, and dealing with cerebral palsy. So it's on and on. The other thing that worries me when I started doing my expectant management study, as I said, 40 years ago, one of the concerns I had when we were following these babies is the impact on the family themselves, the emotional impact. So many of these families, their lives was disrupted. Many of them ended up in the walls and so on. I cannot even mention to you some of the things that happened because all the efforts of the trial will be concentrated on dealing with such side. And if they have other children, these children will have no attention whatsoever.

Dr. Sibai, would you mind actually just adding on to that? Could you maybe just speak to the importance of maintaining systolic blood pressure below 160 for prolonging pregnancy?

I think this is really one of the most important things and the randomized trials that have been involved with and we conducted over the years, and they have been involved probably at least 4, maybe 6, trying to use different medications or different molecules to try to see if we can prolong gestation in these women. Unfortunately, almost all of these trials, more than 50% of patients, ended up being delivered because of what I call "uncontrolled blood pressure or resistant hypertension." And the main reason really has happened in the United States and in many parts in the world, there is a system called the maternal obstetric early warning sign, which we for sure [indiscernible]. And any time [indiscernible] blood pressure reaches 160 or more, [indiscernible] is triggered. Once this really happens in the hospital, a team of individuals, including nurses and doctors, have to rush to the bedside. And our biggest problem with preeclampsia apparently is that with the available blood pressure medications are used, this is very common. And in general, once 2 or more immunes are triggered, everybody starts using this as an indication for delivery. And this is why you see in these trials that have been published today, maternal indication for delivery, being uncontrolled hypertension, was the most important problem. And this is why an opinion, a molecule like this, or a drug like this is going to have great implications if it prevents these episodic elevations and systolic blood pressure, which by itself will lead to a major point to start to prolong gestation in such women. The other thing that's appealing about this drug, as I said, is not just about lowering blood pressure. It's really this benefit on repairing the agent endothelium. As of today, I have never seen any medication that is able to do this. The second thing that's very important, based on my studies and the trials I have done. The second most common reason why delivering these patients is what I call fetal indication. And this is mainly as a result of reduced uteroplacental and blood flow. Based on the studies I have done looking at uterine artery in women who had early onset preeclampsia, almost 97% of these patients have increased resistance in uterine [indiscernible]. Having a medication that will target this part will have a huge implication because now, for the first time, we're having a medication that's not only controlling the endothelial and maternal blood pressure, but actually influencing uteroplacental blood flow. Both of these, I think, are unique. I'm not aware of any medication that they have tested or probably is going to be tested in the future that will have or play such an effect.

Maybe while we're on the same screen here, I mean Dr. Tong, can you maybe just also provide some color here on what would be clinically meaningful for the dilation of the intrauterine arteries?

Yes. So we proposed that perhaps a drop of the resistance of 10% may be of clinical use. It's actually quite a bit of conjecture to figure out what drop will be beneficial. And that's because there is no drug that can even rescue and improve the uterine artery blood flow. So we're really looking at a new horizon that no one's ever been to before. So we've got lots of drugs to try to reduce the blood pressure and a bit of experience there. But in contrast, we don't really have any drugs that rescue the uterine artery blood flow. But you would infer from animal studies, et cetera, that perhaps a 10% drop may be beneficial, but it's, in some ways, conjecture. What it's reflecting is the amount of blood flow in the uterus, and we're not sure how well that correlates to just how much beneficial blood flow there is to the placenta. But it's like a 10% could mean that there is a lot of blood flow to the placenta. So, probably not answered that well. I'm not sure we know, but that's only because it's a new horizon. We don't have drugs to improve uterine artery blood flow to really guide us what would be therapeutically advantageous.

Right. Dr. Walker, any other further comments on interdilation?

Yes. Look, thanks, Rick. I mean, as Stephen said, this is kind of a new horizon. So it's difficult for us to be definitive about the answer here. I mean, I think, first of all, to have something that controls blood pressure that rescues the endothelium and that doesn't cross the placenta. I think there are 3 such big green ticks that's, I guess, the thrust behind why we're really looking at DM199 for preeclampsia. But the signal from the uterine artery is certainly encouraging, and if we did get a reduction in vascular resistance in the uterine artery, we know that's part of the diagnostic criteria for early onset fetal growth restriction. We know that changes in the second to the third trimester of the uterine artery, if it improves, that there is a lower chance of growth-restricted babies than early preterm birth. So I guess we're arguing by analogy that given those changes that we see that if we are able to affect uterine artery dilatation, even as Stephen said, by a fairly modest amount, the physics is simply that if you can dilate it by a bit, you'll increase blood flow by a lot. And therefore, it gives us an opportunity to be optimistic that we'll be improving maternal blood flow through the placenta, improving oxygen and calorie uptake in the placenta, and therefore, available to the baby. And with that, the opportunity to improve fetal growth and to reduce the chance of us having to deliver a baby that is both sick and small and preterm. So I guess that's kind of the hopeful optimism, and it's the reason that we are looking at a cohort in these early-phase trials. We've mentioned the group that are going to be delivered very soon, the group that we've made a decision for delivery because of severity of disease or they're very late in pregnancy. We've got a second group where we're going to be looking at DM199 for prolonging gestation. So a bit similar to the philosophy on the PRESERVE trial that we've heard of. But then there will be a third cohort of 30 patients where we'll be looking at patients with fetal growth restriction, whether or not they've got preeclampsia.

May I add to that?

Yes, please.

I think it's very important for a condition like preeclampsia, it's really a balance because what I call what's good for the mother that might not be good for the fetus, what's good for the fetus might not be. Certain level of increased blood pressure in the mother is extremely important in women with preeclampsia have fetal growth restriction because really and perfusion is dependent on maternal blood pressure. Having a medication that really lowering maternal blood pressure and also reducing resistance in uterine artery is in my opinion, going to be the biggest breakthrough we have in obstetric as it relates to management of patients with IgAN and/or preeclampsia because as Dr. Tong and Dr. Walker said, as of today, we have really nothing I'm aware of that have been successful and have an impact in uterine artery. This is why a drug that targets both of these pathways that has -- is going to have a significant implication for our success in prolonging gestation for such one.

Tara, is there any other questions?

Yes. We have a question from Matt Caufield at H.C. Wainwright.

We actually had a couple of questions for the KOLs, if that's possible. Just the first one, do you see DM199 as possibly being additive to any of the attempts at standard of care? Or do you foresee it acting more as a monotherapy, if ultimately approved? And then we just had a couple of quick follow-ups.

Thank you, Matt. Why don't we have first Dr. Tong?

Well, thank you very much for the question. No, we would see that DM199 would be added to existing care. But what we anticipate and hope that with -- if it has such a good -- if it does have a good effect on blood pressure control, then there may be less need of those other therapies that are used to treat blood pressure, for instance. And the other treatments that Sue Walker had mentioned, we give corticosteroids at the moment of birth, and we would probably still do that. But the hope is that the baby at giving the DM199, we can extend gestation. So even though you give the corticosteroids to help prepare birth, you would still have a much more favorable outcome because the baby is still going to be born at a less preterm gestation. So it would be added to existing treatments with the caveat that there may be such benefits that you may need less of preexisting treatments.

Very helpful. I appreciate that. And then just lastly, curious of your thoughts on sildenafil previously in pregnancy trials. And then just any further thoughts on short-acting versus long-acting blood pressure meds in preeclampsia?

Can I take the sildenafil question, Rick? Sildenafil was a hope, and we all fell behind it. It only acts on the nitric oxide pathway, whereas DM199 acts on the 3 pathways to drop blood pressure. So perhaps there's more scope for good blood pressure control with DM199. So Sildenafil works on the nitric oxide, DM199, that prostaglandin and the endothelial hyperpolarizing factor pathway. So it spreads risk a bit, I suppose. And sildenafil has that solidary action, but DM199, as I mentioned, may have a further benefit that it may have multiple actions to reduce endothelial dysfunction and improve endothelial health. I've mentioned one before. It actually decreases insulin resistance. It has many other things, reducing oxidative stress in the endothelial cells. It has multiple actions to restore blood vessel health, which I don't think Sildenafil has. But I suppose the -- where sildenafil's ended up with really just underscores the potential of DM199. I don't know whether you know there was a worldwide effort and a very impressive effort where many countries did randomized trials to see whether sildenafil could be used to treat preterm fetal growth restriction. And unfortunately, the Netherlands arm found that it was stopped prematurely because there was potential very significant harm in the newborn. It might have caused a condition called persistent pulmonary hypertension. So high blood pressure in the lungs of the newborn. It's a very rare condition. There is a plausible reason why sildenafil could cause that. But this would have been caused because sildenafil is a small molecule, would have crossed the placenta with those possible harms in the fetus. And if DM199 is as we hypothesized, it won't cross the placental barrier, won't into the fetal blood, and therefore, won't have such concerns on the fetus.

May I add to that?

Please.

Again, in the 2 published trials that included really a limited number of subjects, preeclampsia was not shown to improve pregnancy outcome, and really early onset preeclampsia. And again, the main reason, as Dr. Tong said, it has really limited mechanism of action regarding only pathway. I don't think it's going to be the drug that's going to have the impact in the future.

And then the second question, Dr. Walker, do you want to take that one?

Thanks, Matt. So I think the question was just clarifying the role of our current antihypertensives, particularly the short-acting versus the long-acting, if I'm correct. Is that right?

Yes. Yes.

Yes. Great. No, thanks for the question. So you're right. I gave a bit of an overview of anti-hypertensives that are in current use and their mechanism of action. But you're absolutely right, there are, I guess, 2 broad groups of antihypertensives. There's the short-acting ones that we generally use when we've got an acute episode of severe hypertension. So a patient comes in 170, 180, 200, or 120, and we need to get that blood pressure down reasonably quickly. And that's often when we use an intravenous agent. So we, for example, would use something like intravenous labetalol or intravenous hydra, I think. Now these are good drugs because they get the blood pressure down fairly quickly, but they don't last for very long unless you have a continuous infusion. So they're very good for solving the acute severe crisis. But most of the time, when we're thinking about managing patients expectedly with preeclampsia, what we're using is long-acting agents. So these are things like nifedipine, labetalol, or Aldomet that are given orally and we usually give them in divided doses across the day with escalating doses as we start to see the blood pressure is starting to become higher and higher, and we're needing more agents to control the blood pressure. And I guess that's what Dr. Sibai was talking about when he was saying, look, there was uncontrollable hypertension. You've used multiple agents, and you've still got spikes of blood pressure. So you may then be needing to use a short-term agent because you've maxed out all your long-term agents. But I guess once we're starting to be in that situation, it's a situation Dr. Sibai was describing where we're really starting to say, look, we need to abandon expected management. We've now got uncontrollable hypertension, and we now need to move towards delivery, remove that placenta, remove its toxins, and start turning this condition around. So I guess the appeal for us with DM199 is that not only have we seen that it's an effective antihypertensive, but it's also improving the endothelial health and it's potentially supporting the organ that's causing the problem in the first place by improving uterine artery blood flow and reducing placental hypoxia that is causing these toxins to be released. So I guess it's a very fundamental difference in not just what the numbers are of the blood pressure, but how the agent is working to actually ameliorate the disease at its source and also at the target end organ, which is the endothelium.

So we have time for one more follow-up question from Thomas Flaten at Lake Street.

I was just curious, and I guess this is a very open-ended question, and I apologize. But if I think about the patients in Part 1A and B, so the very acute setting of delivery within 72 hours and then moving into later phases of studies where you're in the expected management patients, what data should we be reading through from the very acute setting to maybe I don't want to call it chronic, but longer-term treatment and expected management? Are there endpoints or data points, or results you'd like to see from this first data release that would give you comfort for the expected management patients?

Sure. Dr. Walker, do you want to take that one?

Yes, sure. So I mean, I think the patients where there has already been a decision made to deliver come of 2 sorts. When you've got preeclampsia term, we're not worried about the prematurity risks for the baby, and we start to say, well, no maternal risk is worth prolonging the pregnancy, and we should just get on and deliver. And we would use DM199, I guess, if you like, to the cover for the hypertension in these women who we've decided to make a decision for delivery. And that's what we're using in our dose escalation studies and what we'll use for the first phase in our expansion study of 30 patients. And we've already talked about what the endpoints might be for those studies. So we're really looking at safety, placental cord blood levels, blood pressure control, and looking at uterine artery Doppler. But if we're looking at the second group, that is where it's a group where we said, yes, we've got evidence of preeclampsia. We've got hypertension and end-organ dysfunction, whether it's proteinuria, renal dysfunction, liver dysfunction, or whatever. But at the moment, we feel that we can press on to try and gain maturity for the baby. This is the expectant management group in preterm preeclampsia that Dr. Sibai's study addressed previously. And I guess in those sorts of studies, the sort of endpoints we might be looking at is what prolongation of gestation will we get. From Dr. Sibai's study, we know roughly how long you'll get with expectant management with no treatment. I guess what we would like to see is that we get a prolongation of gestation, but moreover that we see less in the way of newborn complications, prematurity, babies being born very small, requiring high dependency care in the neonatal intensive care, and so forth, both because of the cost of that in the short term, but most importantly, what the impact to that child's life is in the long term. And we'll probably also have a maternal outcome, where we'll be saying, well, how long did it take, for example, until we got a severe complication or we developed some of those endpoints that have been looked at in other preterm preeclampsia to expectant management. I don't know, Stephen or Dr. Sibai, whether you want to advance on that?

Yes. And again, in these initial studies, I think it's going to be important to see how many extra days you are going to be able to prolong gestation with the expected management. And again, the number of days is very important based on gestation and age. I always say gaining an extra 4 or 5 days at 23 and 24 weeks is different than gaining 5 or 6 days when the baby is 32 and 34 weeks. This is why targeting a very early onset is important. But at the same time, maternal safety is going to be important. Improving outcome of the baby is not going to be good if, during expected management, you're going to have bad outcome to the mother. And some of the things we are going to be or needs to be looked at for the mother is going to be development of pulmonary edema, changes in maternal platelet count, whether the patient is going to have seizures or eclampsia, whether they're going to have any abnormality or dysfunction in the liver enzymes and how severe this is going to be. So these are what I call the maternal endpoints that will be or whether the patient is going to have a stroke or not. So this should be measured at the same time. And hopefully, this medication will show it's not only improved neonatal outcome, but it's also going to stabilize and even improve maternal outcome, which I really didn't mention and nobody has asked what is really the cost the mother, we all have been talking about the baby. There is a lot of cost even to the mother when we do the expected management. And then ultimately, our endpoint for delivery is pulmonary edema, kidney injury, liver injury, eclampsia, or stroke. All of these have significant implications regarding what happened to the mother acutely, plus also the patient having severe renal injury, which is going to require dialysis and even need for kidney transplant later on. If they have pulmonary edema and they have pulmonary fibrosis because of severe hypoxia, or they have a stroke. Even the mother will have both acute and long-term implications.

Great. Thanks for the questions, Thomas. So this concludes the Q&A session for today. I'll now turn it back to Rick for closing remarks.

All right. This is great. Well, thank you, Dr. Sibai, Professor Tong, and Professor Walker. I truly do appreciate your insights and thoughtful discussion today. Your contributions here are invaluable as we work to educate the broader investor and medical communities about preeclampsia and our investigational therapy, DM199. To everyone who joined us, thank you for taking the time to hear our preeclampsia story. We hope today's discussion has deepened your understanding of the serious condition and what also was meaningful progress looks like in terms of both safety and efficacy outcomes. I also just want to highlight from our conversation today what we believe the medical community is looking for with a new therapeutic like DM199. And so ideally, we'd like to first show a drop in systolic blood pressure of at least 10 millimeters of mercury and a diastolic drop of at least 5 millimeters. And we want to see this in more than half or the majority of patients at or near the targeted dose going forward. Second, and perhaps most critical from a drug development standpoint for preeclampsia, is that we're dealing with 2 lives here, the mother and her baby. That's why safety is absolutely paramount for this disease. And we need to see that DM199 is safe and generally well-tolerated by the mother. And just as importantly, that there is minimal to no transfer of DM199 across the placenta. And finally, we see significant upside potential with our drug and the study endpoint if we do see any evidence of dilation of the intrauterine arteries. And specifically, we talked about a drop of 10% or more in the Pulsatility Index in at least half of the majority of the patients. And in particular, we're looking for this in patients that have a high baseline Pulsatility Index. As we discussed, this index measures the resistance to blood flow, and this could suggest improved placental perfusion or increased blood flow to the placenta. This could actually be a potential disease-modifying effect that could bring meaningful benefits to the baby and the mother. So if we can achieve these 3 key endpoints, we believe we're advancing something truly novel in the field that has seen very little innovation. I also want to highlight that with no FDA-approved treatments available today and limited therapeutic options on the horizon, the DM199's unique mechanism of action gives us the potential to meaningfully address this critical unmet need. Given the severity of preeclampsia and the lack of alternatives, we would expect strong adoption if this drug becomes approved, supporting our belief that this represents a multibillion-dollar market opportunity for DM199. Now we look forward to sharing the preliminary top-line results from the Part 1A of the current investigator-sponsored trial, which we anticipate releasing in the coming weeks. So thank you again for your time and engagement. And with that, this concludes our call today. Thank you.