Herantis Pharma Oyj (HRTIS) Earnings Call Transcript & Summary

Good morning, and welcome to Herantis Pharma's R&D Webinar. My name is Antti Vuolanto, I'm the CEO of Herantis, and together with me, I have here our CSO, Henri Huttunen and CFO, Tone Kvale. This webinar will be recorded and will be available online after the presentation. And you are welcome to submit any questions during the webinar and we are then after the webinar have a Q&A session. And here, you see the necessary forward-looking statements. So in this webinar, we will cover the data that we have on our lead asset, HER-096, the development plan going forward and also a summary of why Herantis is an attractive investment target. So Herantis Pharma is a clinical stage company listed at Helsinki First North. And we develop disease-modifying therapies for Parkinson's disease and other CNS disorders. And our lead asset, HER-096 is a peptidomimetic compound that is designed based on CDNF protein that the company has studied earlier. We do have great data with HER-096 from both preclinical studies and a completed Phase Ia clinical study, where we demonstrated good safety profile and efficient brain penetration, which is, of course, very important for further development. But what makes us a bit unique is the fact that we do have clinical data with CDNF protein that we studied earlier. And we studied CDNF with 17 fairly advanced Parkinson's patients and among -- in that study, we were able to show signs of biological responses in Parkinson's patients. And now we can utilize this understanding on this data with HER-096 that has the great advantage that we can use a subcutaneous administration going forward. And currently, we are -- our HER-096 is studied in Phase Ib clinical study, as we announced a couple of weeks ago that we started the study. We also are preparing or doing the preparations towards Phase II clinical study and of course, what is important, we are very active in the partnering discussions. All of this will be described in more details going forward. So we believe that HER-096 is an ideal candidate for addressing the unmet clinical need in Parkinson's disease. As mentioned, HER-096 is designed based on the active side of the CDNF protein. We have shown in preclinical settings and yes, we do have exactly the same mechanism of action. So the modulation of the unfolded protein response pathway, and Henri will describe this in further details later. Importantly, HER-096 is a synthetic molecule, easy to manufacture, easy in regulatory point of view, and as I said, penetrating the blood-brain-barrier also demonstrated in humans. And what we believe that HER-096 can do as a treatment in Parkinson's disease. So first of all, we believe that it can provide rather quickly symptomatic improvement. However, the eventual goal is to have a long-term effect with disease modification. So slowing down or even stopping the progression of the degeneration of the target neurons. Related to the market opportunity we have estimated that this is modifying drugs for Parkinson's disease might have a global market of approximately USD 10 billion and we believe that HER-096 has the potential to take a big part of that potential market. And what I want to highlight is the team and the way of Herantis is working. The management team, we have -- all of us have more than 20 years of experience in the industry in drug development, biotech, and we do have the necessary skills to take this program forward into commercialization together with a pharma partner. And the way the company works is that we don't have our own laboratories or manufacturing. We use our global partner and supplier network for actually conducting the operations. But our core team of 10 professionals, we manage that in that network for us. And by using that, we can always select the best skills that are available globally to advance our program. And in addition to the operational team, we have great support from our Scientific Advisory Board, composed of professionals from industry academia and patient organizations. So the Chairman of the Board, Anders Gersel Pedersen has a vast experience from Lundbeck and Lilly. He has led the R&D at Lundbeck. And also Daniel has great experience in the industry. Alberto and Daniel have experienced -- very experienced neurologist treating the patients. And David, very strong scientific background and also working for a patient organization, Parkinson's U.K. And we believe that this mix greatly supports commercialization of HER-096 for Parkinson's disease. And what I want to also highlight is that actually, we have been very efficient in the development of HER-096. So the company has been established already in 2008 based on the discovery of CDNF protein by the researchers at Helsinki University. The company was IPO-ed 2014, and during the first 10 years of the company, the CDNF protein was taken from preclinical studies into clinical studies where that was really successful study. However, the route of administration that we had to use with CDNF was something that we couldn't commercialize. And that's why we started the development of, as we call it, a next-generation CDNF already 2017. And we very quickly advance that in such a way that late 2019, we were able to file the patents covering compounds from which we -- from which library, we selected HER-096 as the lead compound only 3 years ago and we have already compiled a very attractive package of preclinical evidence. We have completed the first clinical study. We are currently running the second clinical study. And we have obtained support for this program from European Innovation Council that finance our biomarker program and also from Parkinson's U.K., Michael J. Fox Foundation, who provide the funding for the Phase Ib. So currently, we are running the Phase Ib. We are preparing for the Phase II and at the same time, we are discussing -- in discussions with pharma towards a partnering agreement as that will be the way of commercialization of HER-096. So this was the summary -- high-level summary. And now I give the word to Henri, who will take us through the scientific data and development plan.

Parkinson's disease is the most common movement disorder and the second most common neurodegenerative disease after Alzheimer's. It's typical motor symptoms are caused by a progressive decline and decrease of dopamine levels in the brain, which is associated with a gradual loss of synaptic terminals and degeneration of axons of dopamine producing neurons. While this process is quite slow and the root cause of Parkinson's remains to be poorly understood, over the past 2 decades, we've learned a great deal about various cellular pathways and dysfunctions that are associated with degeneration of dopamine neurons. One important organelle is the mitochondria, which are the energy powerhouses of the cell. They are located in the cell bodies as shown in this image but also in synapses. The synapses consume a huge amount of energy to produce their function in the electrochemical communication between neurons. Two other important central organelles for dopamine neuron survival function and eventually degeneration are related to protein homeostasis, also called proteostatis. These are the endoplasmic reticulum, the ER, which is a main site of protein synthesis and the lysosome, which is responsible for degradation and recycling of aged and damaged proteins. So various type of dysfunctions in these organelles are centrally involved in the process that eventually leads to degeneration of dopamine neurons, which results in decrease of dopamine and consequently, results in the motor symptoms of the disease. Now as of today, the treatment of Parkinson's disease aim to restore or increase dopamine levels in the brain and so-called symptomatic treatments. We're not able still in 2024 to stop the process of degeneration per se. There's been a lot of interest in this proteostatic disruption and one very important protein that typically is associated to Parkinson's disease is called alpha-synuclein. Alpha-synuclein is a protein that tends to misfold and aggregate. And these alpha-synuclein aggregates associated with various cellular dysfunctions in dopamine neurons. For example, they induce endoplasmic reticulum stress cause mitochondrial dysfunction and induce neuro-inflammation. So in addition to neurons, we have billions of supportive cells in the brain, so called glial cells. One type of glial cells called microglia is very important in the process of neuro-inflammation. The microglial cells are myeloid lineage immune cells that reside in the brain and respond to various types of stimuli and try to maintain the brain in a healthy state. Alpha-synuclein aggregates our powerful stimulus for microglial activation. And when the microglial cells are remained in a chronically active state, they contribute to the neurodegenerative process by secreting pro-inflammatory factors. So what we know from CDNF biology is that CDNF can protect the neurons from the degenerative process, but it also seems to have effects on these inflammatory processes in the brain. So these elements together form a vicious cycle and that seems to be triggered and driven by the alpha-synuclein aggregation phenomenon. We believe that we can break this vicious cycle by targeting a cellular system called unfolded protein response pathway. So the unfolded protein response pathway is, of course, tightly connected to the disruption of proteostasis, the alpha-synuclein aggregation and -- but also they are involved in regulation of activity of immune cells. So we have the target protein system is expressed both in neurons and glial cells. The unfolded protein response pathways is a well conserved and ubiquitously expressed system, a stress response system in basically operating in all cells of the human body. It's composed of three signaling arms called IRE1, PERK and ATF6 and the activity of these three receptors is controlled by a common master regulator called GRP78. Typically, when there is an ER stress condition or stimulus, the UPR system is activated transiently. And it aims to restore homeostasis, particularly in the ER. However, sometimes in pathological states, the UPR system -- the regulation of the UPR system breaks down and the system may remain unelevated state of activity. And this has been connected to triggering apoptosis, cell death in various cell types. And the way CDNF and HER-096 interfere with this system is that we can bring down the pathological activity of the UPR system to the homeostatic state. So it operates in a way as a real start system. A few weeks ago, we published an important paper in Nature Communications, where we described the complex structure of CDNF with GRP78. So CDNF binds the GRP78 regulatory domain by its C-terminal domain as shown here. And HER-096 was originally designed and developed based on this binding interface, shown in pink. Now as Antti mentioned already, there are various benefits that HER-096 has over CDNF and perhaps the most important one is that it can penetrate the blood-brain barrier, which protein such as CDNF cannot do. Also being a fairly small molecule, we can manufacture -- we can synthesize HER-096 with the chemical synthesis, which is a major benefit in terms of cost of goods for manufacturing and scale up compared to a recombinant protein, which CDNF, of course, was. In this paper -- the structure paper, we also were able to get further insight into fairly long-standing question on the multimodal nature of CDNF and its mechanism of action. So the UPR system is active and operative in both neurons and glial cells, and we seem to have neuroprotective, neurorestorative anti-inflammatory effects but it hasn't been quite clear whether we have multiple targets or if these are mediated by one target. And in this paper, we showed that if we mutate a couple of key amino acid residues in the binding site or binding interface in CDNF, we can -- as shown in the table here, we can lose the binding and these mutants that cannot bind the GRP78 also have lost their ability to protect dopamine neurons. They have lost their ability to reduce alpha-synuclein aggregates and they have lost the ability to modulate UPR signaling. So the blue bars here, the solid colors are the wild-type protein compared to the control condition -- the stress condition in red and the hatch bars here are the mutants and three different concentration levels showing that we have pretty much lost all activity just by mutating 2 amino acid residues. So altogether, this shows that GRP78 is the key target protein that mediates the CDNF neuroprotective effects, unfolded protein response, modulating effect and the effects on alpha-synuclein aggregation. As mentioned, HER-096 can penetrate the blood-brain barrier and here's a nice visual demonstration of that. Here, we have used labeled HER-096, injected subcutaneously in healthy mice and then we followed and analyzed the annuals by a technique called cryo-fluorescence tomography. On the left-hand side, you can see HER-096 in brain after -- 30 minutes after dosing. The areas where the colors are bright and warm, other areas where you have higher concentrations at this time point. Here, you can, for example, see that HER-096 is already in the ventricles where the cerebrospinal fluid is circulating. And at 90 minutes, you can see there is -- there's a fairly strong -- a very strong signal in the ventral part of the brain. And it should be mentioned that this is where the dopamine neuron cell bodies are located. So it looks like we are really reaching high concentrations in those brain areas, which we are targeting in Parkinson's disease. To produce a little bit more quantitative view in this data, we've used dual microdialysis. And here, we've injected again, HER-096, unlabeled from subcutaneously to healthy rates. And then we've collected brain interstitial fluid from striatum, the target brain area of dopamine neurons and plasma from the jugular vein. The plasma curve can be seen in gray in this graph and the brain interstitial fluid in blue. And the main take-home messages from this data is that we can reach nearly 200-nanogram per ml levels in the striatal interstitial fluid. So the extracellular fluid that surrounds neurons in the brain parenchyma. We also see that the brain half-life is longer compared to plasma, which is perhaps relevant for therapeutic effects. Overall, if we compare to the ratio of exposures, brain-to-plasma ratio, we have about 20% compound in the brain parenchyma compared to plasma. For testing the therapeutic effect, the pharmacodynamic effects in an animal model, we've used a model that is relevant for human Parkinson's disease. So here, we injected aged mice into the substantia nigra, where the dopamine neuron cell bodies are located with preformed alpha-synuclein oligomers. We combine this with a pharmacological treatment that induces lysosomal dysfunction. And altogether, this results in a progressive degeneration of dopamine neurons as shown here by the images, which is associated with neuro-inflammation and also increased levels of ER stress markers. So first, in this model, we asked a question that do we modulate the target pathway activity in the substantia nigra deep in the brain, if we have administered the compound subcutaneously. Here, we've used 2 markers of UPR activity, the phosphorylation of IRE1 and the activated -- translocation of the activated form of AGF6 into the nucleus. And here, in these graphs, what you see is -- the white bar is the healthy animals, the red ones are the model animals with vehicle placebo treatment and the blue solid color bars are the HER-096-treated model animals. The left graph shows that we have a very strong reduction in levels of IRE1 phosphorylation indicating that we don't regulate its activity in this animal model in substantia nigra. This very similar finding can be also seen with AGF6. So this shows that we have modulated target pathway activity in the critical brain area after subcutaneous administration of HER-096. Then two other important parameters relevant for disease modification are, of course, alpha-synuclein aggregation and neuro-inflammation. Here, on the left graph, you can see that HER-096 treatment for 4 weeks in these animals can down regulate the levels of alpha-synuclein aggregates in dopamine neurons by about 50%. This associates with the very significant down regulation of IBA1 positive microglial cells, indicating that microglial activity is also down regulated in this model. Perhaps most importantly, what we see in these animals is protection of dopamine neurons. So this is -- this would be the cornerstone, the foundation for the disease-modifying effect. And here, you can see that in this study, we have been able to protect the dopamine neurons increase the level of dopamine neuron cell bodies by 60% compared to model animal. Very importantly, this correlates with strongly increased levels of dopamine in the striatum as seen in the middle graph. And this is, of course, linked to the symptomatic treatment mentioned earlier on the symptomatic effect. So we have also a very nice and clear motor phenotype in these animals. They do develop motor dysfunction over time associated with the dopamine neuron loss. And we can improve those symptoms, and that is most likely related to the increased levels of dopamine neurons and increased levels of dopamine in striatum. This is a -- this visualization helps you to appreciate the motor phenotype and the effect. And this is a normal aged mouse, walking along a narrow pole. And this is a mouse with alpha-synuclein pathology in the brain. There's a very clear motor phenotype affecting particularly behind limbs, and walking is slow and not well controlled. And here's an animal that has been treated with HER-096 for 4 weeks, the model animal. So it is a very clear symptomatic improvement compared to placebo-treated animal in the middle.

So Henri, I have a couple of questions related to mechanism of action and preclinical data. So we addressed the unfolded protein response pathway. Can you comment how specific that is for Parkinson's disease? And do we have opportunities outside of Parkinson's disease in CNS, central nervous system indications or even outside of that?

This is a very important question and as I briefly mentioned with the UPR introduction slide, the unfolded protein response pathway and the master regulator GRP78 are well conserved and ubiquitously expressed proteins, meaning that basically all cells of the human body express these proteins and the UPR system is active in most cells of the human body. There's also a lot of scientific literature over the past few years showing that deregulated unfolded protein response pathway activity is associated with a number of diseases, not just brain diseases, degenerative brain diseases. But also, for example, there's a lot of activity in metabolic diseases. UPR activity has been shown to be quite centrally involved, for example, in diabetes, pancreatic beta cell survival and function and also associated with obesity, liver function and so on. So based on this, we believe that compounds like HER-096 could be widely used in CNS, and also possibly outside of CNS for therapeutic purposes. There's also very nice preclinical papers from the academic researchers showing that CDNF has robust therapeutic effect, for example, in ALS and ischemic stroke.

And how -- now we have data with the alpha-synuclein mice model. Can that be used somehow for guiding the studies with other indications potentially if we go forward with expanding the -- from Parkinson's disease?

Synucleinopathy is not only associated with Parkinson's disease. So there are some other diseases, which also are neuro-pathologically characterize by accumulation of of Lewy bodies and alpha-synuclein, for example, dementia with Lewy bodies, some other disease like multiple system atrophy and so on. Perhaps we would be best informed by using some other more specific animal models specific to other diseases and that's actually something that we are currently interested in exploring further.

Yes. So you also presented that HER-096 is cleared at least in mice, rather quickly after the injection. But you also mentioned that in the preclinical studies, the mice were treated 3 times a week optimally. So can you comment a bit on this administration? And what is the rationale that you clear it quite quickly, but you still can administer quite -- in a way, quite seldomly so...

Yes, this is actually a very important point to highlight. So what we've learned already with CDNF is that the half-life of the biological effect of both CDNF and HER-096 are actually much longer than the half-life of the compound itself. So in other words, we seem to have a hit-and-run mechanism, meaning that we don't need to have the compound continuously present in the body in order to exert the therapeutic effects. So the short -- relatively short half-life actually is -- serves our purpose rather well.

And can we use this understanding for designing human studies? Can we draw any conclusions there?

Yes, absolutely. I mean this is, of course, something that we will be best guided with clinical data going forward. But we believe that in human patients, we wouldn't need to dose daily, for example. We believe that perhaps the frequency of 2 to 3 doses per week would be sufficient for the optimal therapeutic effect.

Okay. Let's go into clinical.

Thank you. So as you well know, HER-096 has fairly quickly passed through the nonclinical development phases, and we are currently in the phase Ib study as we completed the phase Ia late last year. In the phase Ia study, which I will present in the next few slides we have demonstrated the safety of single dose of HER-096 subcutaneously in healthy individuals. And now in the Phase Ib study, we are further looking at safety of multiple doses in Parkinson's patients over a time period of a few weeks. Pharmacokinetics is very important outcome measure in both of these studies. We need to understand how the compound is metabolized and excreted in humans. And so far, the data is well aligned with our preclinical findings. After the Phase Ib, which we estimate would be completed in about 12 months or so. We are planning to start a move on to a Phase II study, which would be a longer treatment in patients, and this would be the first clinical study where we would be primarily assessing efficacy in patients. So in the Phase Ia study that has been completed, we have tested HER-096 in ascending dose levels using a single dose, first in healthy male subjects and in the second part of the study in healthy aged individuals. So safety and tolerability was the primary endpoint, and pharmacokinetics was an important secondary endpoint. And the difference between the 2 parts was that in the Part 1, we did not collect cerebrospinal fluid samples and that part was -- that was done in the Part 2 only. And this was important for demonstration of blood-brain barrier penetration in humans. There's also a very important component of biomarker development that goes through the -- from the preclinical to various clinical stages, and there's rather sizable effort in terms of discovering and developing biomarkers that would be able to demonstrate treatment response, for example, in human subject. And that was also part of the Phase Ia study. So overall, the safety profile of subcutaneous single-dose subcutaneous HER-096 in the Phase Ia was very good. There were very few systemic adverse events. There were no serious adverse events. And the adverse events recorded were mainly local reactions related to the injection site. Injection site reactions, we're also seeing in the placebo group, but the number was increasing with the dose level. Regarding the pharmacokinetic data, as already mentioned, the plasma half-life is fairly short. And in humans, we have about 2-hour half-life in plasma. The absorption is fairly quick. So it's around 1 hour until we reach a maximum concentration in plasma. And what's very important is that we actually have linear pharmacokinetics as you can see in the left side graph here. It means that it's -- the compound behaves in a predictable way when we increase the dose level, at least in this 10 to 300-milligram range tested in this study. The difference between young and elderly individuals was not very significant. There's a little bit longer plasma half-life as expected as elderly individuals typically tend to have a slightly impaired kidney filtration rate, and this relates to the longer plasma half-life. The compound is eliminated mainly by renal excretion as already was shown by preclinical studies. And very importantly, in this Phase Ia study in the Part 2, we were able to demonstrate blood-brain barrier penetration. These data -- the time points are -- the data points come from single time points per subject and we sampled cerebrospinal fluid until -- or up to 12 hours in this study. So this gives us some idea but not a complete picture of the CSF or cerebrospinal fluid PK profile and that's why in the Phase Ib study, we are doing actually currently some further time points to get a full PK profile in the CSF. The concentrations that we reached in the CSF are in the range of expected therapeutic concentrations around 100 or up to 100 nanograms per ml in this time frame. It remains to be seen what the extended time points will show. So in conclusion, the primary endpoint was met in this Phase Ia study. We also met the secondary endpoints, and we have collected important samples for further biomarker development. We won't go into details of the biomarkers today, but the work is progressing as we speak. The Phase Ib study that we started a few weeks ago, is composed of 2 parts. In the first part, we will dose single 300-milligram dose of CDNF -- excuse me, HER-096 to 12 young elderly individuals, and we will collect CSF by lumbar puncture at the time points indicated here. And the purpose here is to get the extended single-dose pharmacokinetics in the cerebrospinal fluid, which will be important data in our preparation for Phase II making decisions on, for example, dosing interval. In the second part of the study, we will recruit 24 subjects with Parkinson's disease and the subjects will be divided in 2 dosing cohorts. They will receive either 200 or 300-milligram doses of HER-096. Both cohorts will have 4 placebo subjects and 8 subjects on active treatment. All subjects will receive 2 doses per week for 4 weeks. And the primary endpoint outcome measure of this study is still safety and tolerability. We will get further pharmacokinetic data from patients, again, feeding it to our Phase II preparations, and we also collect a new set of biomarker samples, and this will hopefully help us to demonstrate a biological response to the treatment.

Okay. I have, again, some questions related to the clinical part. So first of all, could you comment on what kind of patients we are going to recruit for the Phase Ib? So what stage.

This Phase Ib study is recruiting fairly broad -- Parkinson's patients fairly broadly. So we're not limited to, for example, early-stage disease or de novo patients without dopaminergic treatment or so on. And the purpose there is to demonstrate safety in Parkinson's patients, broadly speaking.

And then related to Phase 2 that you mentioned that we are already started the preparations. Obviously, we don't have the protocol yet. We need to see what is the results from the Phase Ib. But can we have any estimations of how long time it would take until HER-096 could have a symptomatic effect or this is modification effect? Can we draw any kind of estimations of how long Phase II study should be?

Yes, this is a very important question for the design of the Phase II. Also a very complicated question, by the way. So if we think about disease modification as a result of regrowth of dopaminergic accents from the substantia nigra to the striatum, to the target area. This is probably almost likely a process that will take from weeks to months. So we're not expecting to see an effect in days or weeks. It will take time. However, if we do have a symptomatic effect, perhaps via functional improvement of the existing synaptic terminals, for example, that would probably be detectable in a shorter time frame, perhaps from days to weeks. And of course, we're interested in both. It would be beneficial for us, of course, if we could see a treatment response earlier. But since we cannot know for sure, most likely the treatment -- the duration of treatment in Phase II is going to be somewhere from 6 to 12 months.

And something that we haven't covered today is the earlier CDNF clinical study and preclinical study. How we can exploit those experiences now when we are doing the HER-096 clinical development and plans towards Phase II?

This actually puts Herantis in a quite unique position as we've been fortunate to learn from the mother molecule over many years, and now we can exploit that information for HER-096 development. I would say that perhaps the most important aspects from CDNF studies, both preclinical and clinical, are the learnings about the mechanism of action for one. For example, understanding that we have a hit-and-run mechanism that we don't need to have a continuous presence of the compound in the brain is actually quite important information for designing further clinical studies. Secondly, an important learning from the CDNF Phase I study was that we need to be able to access and address earlier patients. Patients with who are perhaps still de novo fairly soon after diagnosis or maybe 1 to 2 years after diagnosis, were they still expected to have quite many dopamine neurons left, synaptic terminals are perhaps struggling functionally, but not completely lost. And this is, I think, the sweet spot for therapy is like HER-096, where we can actually bring those remaining dopamine neurons and synaptic terminals back to fully functional state and help to restore the functions that are otherwise going to decline over time.

Okay. So let's move in the business part of the presentation. So first of all, we have seen an improved sentiment in the field of development of disease modified therapies in neurodegenerative diseases. And why I'm not only talking about Parkinson's disease is that there are other diseases that are shared common challenges in drug development point of view. And we have lately seen advances with Alzheimer's disease development. So there are the first disease-modifying therapies on the market, so anti-amyloid therapies. Two of them have been approved by the FDA for U.S. And we believe that this is, in a way, paving the wave also for other neurodegenerative diseases. And one important aspect there is the regulatory environment. As traditionally, the regulatory endpoints have been very much concentrated on the clinical science and symptoms but now we have seen a shift towards regulatory authorities allowing using endpoints that might be more relevant and suitable for disease-modifying therapies. And we also have seen a lot of progress in the biomarker development and the importance of biomarkers for both Alzheimer's and Parkinson's disease, as a tool for drug development, but maybe also as a tool for clinic endpoints as in the clinical study, providing supportive information for regulatory purposes as well. And we believe strongly that this trend is going to continue and we will see new disease modified therapies on the market in Parkinson's disease or in all of the neurodegenerative diseases. So let's go a bit into Herantis so we are currently running the Phase Ib clinical study and very important for us is that we obtained, as we call it, an external validation of HER-096 and the program from the Michael J. Fox Foundation and Parkinson's U.K., who reviewed and did due diligence on our program. And they formed a consortium who wanted to contribute into HER-096 development. And they provided us a EUR 3.6 million for -- as R&D financing for the Phase Ib program and also supporting the biomarker program, as mentioned, that's considered to be one of the key success factors in development of these disease-modifying treatments. And I'm really happy that during the past 18 months, the company has secured more than EUR 6 million non-dilutive financing from the charity consortium and also from European Innovation Council accelerator. I think that demonstrates the potential of HER-096. And of course, very happy that related to European Innovation Council Accelerator, we have also a commitment of EUR 15 million equity investment by EIB due to Herantis in any subsequent equity raises, strong support for Herantis. So Herantis, as an investment opportunity, we are currently running the Phase Ib study, of course, in drug development, the -- we cannot expect to have major news every month. Drug development takes time. However, we are in a fortunate situation that we do have several near-term value inflection points ahead of us. So we expect to have a readout of the Phase Ib study in the second half of the next year, but we do have milestones even before that. And we believe this can provide the certainty for the community that we are developing our asset in a way that we have defined earlier. And in addition to these value-inflection milestones, we do have also additional R&D goals that are especially important for the partnering process. And there, the preparation of the Phase II clinical study is the key. We want to have a study protocol that really can address and provide us the possibility to demonstrate the proof of concept of HER-096 in Parkinson's patients. And we are really active also in partnering discussions as we have had over 100 partnering interactions during the past 2 years. We have had contacts with 55 pharmaceutical companies, had 75 meetings with them. And we believe that we know quite well what is expected from Herantis that can trigger a partnering agreement. Of course, Phase Ib clinical data readout in about a year, it's very important, but there are also other important things that have been raised in the discussions with pharma. Biomarkers, they are very important, more data on pharmacokinetics, pharmacodynamics, both preclinical and clinical data is important. The readiness for launching the Phase II program is very important and that's why we are currently working so actively towards creating that Phase II protocol. And our expectation is that latest when we have Phase II proof-of-concept data, if that's positive, that will trigger a partnering agreement, which is supported by the history in neurodegenerative diseases. And we have analyzed the recent deals in Parkinson's and Alzheimer's disease. So if we first look at the Parkinson's disease transactions during the past 2 years, we see 2 major deals there. The latest one is just a month ago. Sanofi invested equity in a company called Ventyx, who developed an inhibitor for addressing neuro-inflammation in Parkinson's disease. Two years ago, we saw a deal of, again, Sanofi with the Korean company, a major deal with a total potential value with the milestones over EUR 1 billion with alpha-synuclein aggregate targeting immunotherapy. So these companies or the products address one part of the pathology, whereas we are targeting maybe more holistically the challenge of Parkinson's disease. And then there are a couple of examples of recent Alzheimer's disease deals, Sanofi and Takeda have acquired -- or have done transactions with compounds that address neuro-inflammation or the amyloid black reduction. And we believe that Alzheimer's disease is also a very good comparator for us. Different kinds of deals are there. And of course, eventually, Herantis is looking at an out-licensing deal with a global pharmaceutical company. So now we have covered, together with Henri, about the HER-096 background, the mechanism of action, the data that we have, the clinical status Herantis as a company. And now it's time to answer the questions that you have provided us during the webinar. Tone?

Thank you. Very good presentation. And we have plenty of questions to be asked. So Antti, maybe you can start. As you saw from the presentation, we have made great progress with the partnering discussions. Can you say something about the feedback, which we received from the pharma companies related to the progress we have had for both preclinical data and the clinical data?

Yes. Maybe overall, one important piece of feedback is that actually, currently, if you look at the disease modifying therapies in development. There are not too many like companies or compounds in the development. So we are actually among the quite few new compounds that are in development. So that's something that we have heard from the big pharma. And maybe, Henri, maybe you can comment on what are the comments that we have heard about our data -- actual preclinical data that we currently have.

Generally speaking, there's been a quite many companies who have followed us already at the CDNF development stage. And back then, the most frequent request was that if you only could administer this pharmacological activity non-invasively, peripherally. And basically, we have saw that big problem with HER-096 and now being back in the clinic, in many discussions, the parties have been very impressed by the speed of development, how quickly this actually happened. In general, drug development is very slow. We have to keep that in mind. And as Antti pointed out earlier, coming from the library to the clinical studies in just 3 years has been quite impressive also for the partners. Overall, there are companies that go a little bit back and forth with Parkinson's. Parkinson's is a challenging indication for clinical development. It is etiologically heterogeneous. There's many pathways involved. And the biomarkers for clinical development are not quite there yet to like perhaps in Alzheimer's, they are a little bit more advanced. So there's a little bit of hesitation sometimes in the discussions. And perhaps the third thing that we often hear is that the mechanism of action seems quite interesting, but complicated. And there's no direct clear human genetic data validation in Parkinson's disease. So these are, I think, in summary, that what we typically come across in partnering discussions.

Yes. But I also think that what we have obtained of feedback is that as of today, they are very impressed by what we have delivered so far. And then, of course, it's always something they want to see in addition, which we are working on, as you said. So that's a good thing. So Henri, maybe next is for you also. It's -- we are now running the Phase Ib trial. And in parallel to that, we're also working with the design of the Phase II, which is going to be a very important study. So can you say something about the key factors that we are considering when we are designing this Phase II?

Yes. I guess we briefly touched upon that already with the treatment duration question earlier. I think that is very important. So whether -- or how many months do we need to treat at the minimum or what would be the optimal duration of treatment? And that, of course, relates to also the endpoints, the outcome measures. And from the regulatory perspective, the outcome measures should be focused on clinical outcome measures. But in Parkinson's, it's a bit complicated as most typically used clinical outcome measures were actually developed for symptomatic treatments that show a response within hours. And they're not well suited for disease modification trials. So there's quite a bit of work to do there and also regulatory interactions and discussions we need to consider. Another important question relates to the patient population. How many patients, what stage they should be in at screening? And then, of course, the dosing interval, the dose level, the type of biomarkers that should be included in the Phase II study. So overall, it's -- how to put all these pieces in the puzzle together is quite nontrivial. There's -- and there's not a single right or wrong way to run this study.

Yes. And Henri, are there any CDNF effects -- beneficial CDNF effects, which you can replicate with -- which you cannot replicate with 096?

Yes, that's actually really important and interesting question on the underlying science. So far in the models that we have used, it's been actually quite stunning how well HER-096 replicates CDNF effects. It's, of course, a small fragment of CDNF. But based on today's knowledge, I would say that we are replicating vast majority of those effects of CDNF that are relevant for therapeutic effects in Parkinson's patients.

Good. New scientific question for you. Can you measure neuro-inflammation markers in patients following HER-096 administration?

Yes. And that's something that we are doing in our Phase I studies as well. We're -- we will collect, for example, cerebrospinal fluid samples, we will be looking at levels of cytokines there. However, typically levels of cytokines, for example, in the cerebrospinal fluid can vary quite a lot among patients. So in a small study, we can expect quite a bit of noise in that data. But to answer directly the question, yes, we can, and we have incorporated some inflammation-related biomarkers in our current studies.

Yes. And that was also kind of a follow-on question regarding that, that can we utilize anything now for the Phase II, which we have obtained. And I guess you answered that or do you want to add something more?

Well, I would say that regarding the biomarker endpoints, there will be a slight shift from Phase I to Phase II. So in Phase I study, we are focusing largely on those type of biomarkers that could give us a treatment response signal that are more related to the biology of CDNF and HER-096. And when we shift or move to Phase II, the biomarker focus will be shifting more towards the type of biomarkers that are indicative of disease progression rate and perhaps more new imaging type of biomarkers and so on. So it's not -- it's an evolving picture with all the biomarkers and how to optimally include them in the clinical studies. It depends a little bit on the data on what we have and also where the field is moving, regulatory interactions and so on.

Yes. And then we have a question related to funding and partnering. And as Antti told you, we have -- the Phase Ib study is already funded by Michael J. Fox and Parkinson's U.K., very important for us. But we have a question coming in, what about future funding plans? And also if you can say some more about the partnering. And of course, partnering is an ongoing process, but maybe you can say something about the funding for the future?

Yes, definitely. So as explained already, what we are looking at currently is to run the Phase Ib to prepare for Phase II in order to have a package for partnering that includes the Phase Ib data and the plan to go forward. And of course, now when we are preparing for the Phase II, and we are doing the partnering discussions, we also need to ensure that we have enough like finance support for these processes, so that we are not in a situation that we desperately need to have a partnering at certain time point. And as we know, we have an authorization from the AGM from the spring time. So of course, we are continuously considering whether we should in a way, how we can support financially our preparations and also the milestone that we have in about a year. Of course, we haven't decided anything, but that's to be then communicated as whether we have any like concrete plans going forward.

Yes. We also have a question here from -- regarding cash runway. And as we said also in the financial reporting in August that we have cash into the second half of 2025 with existing cash we have on board. So that's a good thing. Henri, one for you here. Do you have any estimation on if the clinical tests are successful, when will this be commercially available, 096 in the market.

So -- and very roughly speaking, very speculative answer. It will still take years Phase II maybe a 2-year study overall, depending on the size, duration and so on. Phase III depends a little bit how we can -- if we can combine it somehow with Phase II, have a little bit accelerated process towards the end or -- and also, of course, partnering will affect that. I would say that at least another 5 years, if all goes well and data is good.

Good. I think that concludes the Q&A session.

All right. So thank you for listening us, following the webinar. Hopefully, you also follow the great development that Herantis has done and will be doing in the future. So thank you and I wish you a very nice day.