Medivir AB (publ) (MVIR) Earnings Call Transcript & Summary

Welcome, everyone, to the Medivir Q3 report. Today is a very exciting day. In addition to sharing the great progress and continued momentum in the ongoing fostrox program, it is with great enthusiasm. We look forward to providing an in-depth update on the promising signals of clinical benefit we're seeing with the fostrox LENVIMA combination in primary liver cancer. And we will also touch what that means for our plans as we move ahead. Before we go into the details, as always, important information, and this in detail, you will find when we post the presentation on our website. My name is Jens Lindberg, and I'm the CEO of Medivir. Today, I am joined by our Chief Medical Officer, Pia Baumann; and our CFO, Magnus Christensen; our Chief Scientific Officer, Fredrik Öberg is also here with us for the Q&A session towards the end. But most importantly, we are joined by Dr. Jeff Evans from Glasgow, Scotland, who is a principal investigator in the ongoing fostrox LENVIMA study. Jeff is joining us via link today from Scotland, where he is working clinically today, and he will be putting the fostrox LENVIMA data into clinical context. But before we go into the details of the data we're seeing in the study, a brief update on the overall Q3 results for Medivir. So, Magnus?

Thank you, Jens. I will briefly comment on the Q3 report from a financial viewpoint. All the numbers you see are in million SEK. Most importantly, the result in cash flow in Q3 were in line with our estimate, no big surprises. The turnover for Q3 relates to royalty income from Xerclear. It is similar to last year and in line with our expectations. Other external expenses are higher compared to last year in the quarter, and relates to the clinical cost for ongoing combination study. This is a positive sign, as patients are benefiting longer from the fostrox LENVIMA combination, and currently, more than 50% of the patient in the Phase IIa are still on treatment. The cash position at the end of Q3 is approximately SEK 61 million. And as previously communicated, current cash run rate is into Q2 2024 with the current assumptions. We are evaluating different financial alternatives and we make the assessment supported by the positive data in the ongoing combination study that we have good conditions to carry out the financing for the group, continued operation and continue the development of the fostrox program. And with this, I will hand over back to Jens.

Thank you, Magnus. Before we dive into fostrox update, a quick note on the pipeline. We do have a broad pipeline of partnering programs, and they have experienced nice progress in the past 12 months. And I would specifically like to outline that for 2 of the programs, one being TNG348 with Tango Therapeutics; and the other one being MET-X with INFEX Therapeutics. We are very much looking forward to seeing both of these programs stemming from the Medivir research program to move into the clinic in the first half of 2024. But as mentioned today in the beginning of the webcast, we will focus completely today on the very encouraging progress we're seeing with fostrox and the plans ahead. The main agenda topics today: first, Pia will kick off the session with a much more detailed and comprehensive data update than we have previously shared. This includes a deeper dive into the fostrox LENVIMA data, and the benchmark against what could be expected for LENVIMA alone. One of the key reasons for this update is that a clear majority of the patients have now had at least 12 weeks follow-up and the longest patient has been on treatment for 14 months. So that means that for second-line HCC, the data is becoming much more mature, and it allows us to evaluate and draw conclusions about the potential benefit to a larger degree. After, Pia, Dr. Evans will put the data into context, as he talks about how the HCC treatment landscape has evolved and how he sees it evolving moving forward, including where and how fostrox has the potential to provide clinical benefit. And then finally, we will outline what this means for our plans going forward, and the commercial opportunity for fostrox, before we close with the Q&A session. As mentioned, we will share a much more detailed update than we have done before, and hopefully, not too detailed. But if we want to keep it simple, there are 3 key takeaway messages to remember from this session. First, the combination of fostrox LENVIMA is showing improved clinical benefit for patients across endpoints without compromising on safety and tolerability. This we can see, even though more than 50% of patients are still on treatment, and data will continue to mature further. And #2, key focus ahead is continued development in second-line HCC, the great clinical benefit we are seeing in combination with LENVIMA -- in combination then with the significant unmet medical need. There is in second-line opens a path for accelerated approval intent as early as 2027. And then finally, there are no approved treatments in second-line HCC today after, sort of, current standard of care. And fostrox LENVIMA is at the forefront of second-line development with a very clear opportunity to be the first treatment in the market with a significant unmet need and estimated at $2.5 billion annually. It is a great opportunity for fostrox to lead the way, and make a meaningful difference to HCC patients in need of new treatment options. And with that, I will hand over to Pia, to go through in much more detail, why we are so optimistic and energized about fostrox and its potential in HCC. Pia?

Thank you, Jens, and I look forward to providing a more in-depth update of the clinical data from the ongoing, as we said, fostrox plus LENVIMA study. In addition, I would like to put our data into context, and compare it with the LENVIMA monotherapy study data. And these data are in second-line HCC, as LENVIMA is still the current standard of care in second-line. But first, a very short background of HCC. So HCC is a heavily underserved disease, where patients diagnosed in early stages are actually the only ones that have a hope for a really long-term survival. Unfortunately, around 80% of the patients are diagnosed in more advanced stages, where you see a 5-year overall survival of around 20%. The cause of HCC is sort of cirrhosis in the liver, which damage the liver function and reduces the ability to tolerate medical treatment. It is, therefore, imperative that for new treatments to be successful in HCC, they should not further harm the liver. So despite recent advances in systemic therapies, only 1/3 of patients respond to best available combination, and that is in first-line. And the need for new treatment options remain high. So in 2020, the combination of TECENTRIQ and Avastin was approved, and the treatment paradigm in HCC changed very rapidly. This treatment is now used in the majority of the first-line patient. And as a result of this change, there are no systemic treatments approved, as Jens said, in the second-line setting. Guidelines has since been recommending clinical trial in second-line, and when a clinical trial cannot be offered, LENVIMA is the preferred treatment, despite the lack actually of clinical data and regulatory approval. Current treatment algorithm also shows that traditional chemotherapy has no real role in HCC, and that is primarily due to systemic side effect challenges that is preventing to have the dosing that is needed to provide clinical benefit. There is a high need for treatment that targets the tumor in the liver as well, are tolerable and do not impact vital liver function. Dr. Evans will talk more about, as Jens said, the evolution of treatment practice and the guidelines in HCC. So he will come back to that. So with improved first-line treatment, as we talked about, more patients will continue to second-line, which is good. And the need for effective tolerable treatment can reduce -- that can reduce the tumor burden in the liver is high. Fostrox is unique, in that, that it is an oral, it's a liver-targeted chemotherapy with a selective cell-killing activity in tumor cells, which means that it's sparing the normal cells and will not impact the vital liver function. It is a pro-drug with active substance of troxacitabine, and uses the first pass metabolites. It means that with this approach, it's possible to give the fostrox orally, and achieve a 100-fold liver-targeted exposure versus what you see in traditional IV chemotherapy. So the monotherapy data for fostrox has already been published, and showed good safety and preliminary efficacy. But as HCC is a difficult-to-treat disease, the plan has actually always been to combine fostrox with other treatments to achieve synergistic efficacy and the greatest possible benefit. The most logical combination partner in second-line, coming back to this again is LENVIMA, as it provides a strong rationale for the synergistic activity and as mentioned before, it is the preferred treatment in second-line HCC. So by attacking the tumor with 2 different mechanisms, we are expecting the clinical benefit to improve. But it is also important that safety and tolerability is not compromised when combining these 2 treatments. In this updated data presentation today, we will show that adding fostrox does improve the clinical benefit expected with LENVIMA alone, without compromising safety. The ability to tolerate this combination was actually very good. So the data, again, that we will talk about comes from the fully recruited and ongoing Phase Ib/II study in second and third line. The maximum tolerated dose in fostrox monotherapy, the published data, was selected to 40 milligram. And the starting dose in this study, where it starts with the dose escalation phase, was 20 milligram. And while we didn't see any dose-limiting toxicity or having a maximal tolerated dose, we still selected 30 milligram to ensure that we have an optimal dose with a good balance between efficacy and safety and also a possibility for a longer duration of treatment. LENVIMA was given at standard doses and the patients were treated until investigator evaluated tumor progression. So 21 patients were included in the study, and 18 patients now have more than 12 weeks of follow-up. So this update will really focus on these 18 patients, to give a robust evaluation of the data from the study. The study took place in 15 sites: in Spain, the U.K. and in South Korea. And the primary endpoint was safety, with efficacy endpoint as secondary. So the response evaluation was done with CT and MRI, and it was done every 6 weeks. And the -- today update will primarily focus on response evaluation by the local investigator that is using the acknowledged method, the response method in oncology called RECIST 1.1. In addition, responses evaluated by an independent reviewer, and as this study is in liver cancer. The independent reviewer will also use something called with modified RECIST. This is a method specifically developed for evaluating efficacy in HCC. It focuses really on the part of the tumor that contains active or lining tumor cells. It is also important to note that all patients in this study had progressed on prior treatment, and more than 80% had received to TECENTRIQ Avastin in first-line. So the efficacy data continues, as you can see here, to improve with a median follow-up of now 4.7 months. The overall response rate is now 22%, which has improved from the 17% we saw before. We see continued control of the liver cancer, with a disease control rate of more than 70% at 12 weeks follow-up. The median time to progression has also improved since the last uptake, from 4.5 to now 4.9. But as we heard from both Magnus and Jens, 50% of the patients is still ongoing in the study. And the data continues to mature and hopefully will improve. The data indicates improved clinical benefit than historically has been seen in second-line treatment of HCC. And on the next couple of slides, we will review the tumor response for the individual patients. So thank you. This is a waterfall plot, and it shows for each individual patient, the best percentage change in tumor size. If the tumor shrinks more than 30%, it is classified as a partial response. And as you can see in this graph, 4 patients out of 18 patients are partial responders. A few additional patients have had tumor shrinkage, close to 30%. And with the study ongoing, we could still look further for improvements in response rate. It is important also to note that the response rates in second-line are usually very low and stable disease is considered a successful outcome in this patient population. Stable disease of tumor control is really when the tumor size change is between the green and the orange line you see on this graph. And as you also can see here, all patients had tumor control in the target lesion and the clear majority of the patients, 22% experienced tumor reduction. Additionally, 3 patients that is not part of this analysis since they haven't been followed for more than 12 weeks are ongoing, and all the 3 patients have stable disease at the first imaging scan after 6 weeks. The fact that the absolute majority of the patients are experiencing shrinkage in the target lesion is highly encouraging, but it is also important to see if the tumor reduction is durable over time. So this next slide, we can see a graph. We see how each patient's lesion change over time since baseline. Each dot represents an imaging scan measuring the tumor size and each line that has an arrow at the end, represents a patient that is still on treatment. And we can, from early and -- we can see early and durable antitumor activity with a majority showing tumor reduction. So for many of the patients, we also see that the target lesion continues to shrink over time, including the longest-running patient that has been on treatment for more than 14 months, that Jens mentioned before. Previous studies in second-line HCC report treatment duration around 15 weeks, and usually also includes patients who actually have experienced tumor growth, tumor progression, but continued due to the fact that they have clinical benefit. In the current study with fostrox and LENVIMA, the patient had to discontinue if they experienced tumor growth, which makes durable antitumor activity and treatment duration seen in this graph even more promising. With encouraging data in mind, it is important also to understand the safety and tolerability profile, and especially, since this is a combination treatment. So as previously mentioned, safety and tolerability is even more important in HCC studies compared to many other tumor types due to the vulnerable patient population. In the study, only 10% of the patients had to discontinue due to fostrox-related adverse event, and as many as 65% actually stayed on the fostrox starting dose. And with less than 50% of the patients in this study needed to dose modify LENVIMA, the combination partner, and this should be compared with [indiscernible] data where more than 60% actually dose modified. We are encouraged by the safety, also in this combination. If you look to the right, you can see the adverse event, and we didn't see any that was unexpected and new. And the common -- most common grade 3 and above events with fostrox were hematological, as expected with non-febrile neutropenia and thrombocytopenia without bleeding, and these were transient and manageable. LENVIMA, adverse event in this study were in line with what you can see with LENVIMA monotherapy, nothing new. Hence, it seems like the combination is able to provide improved clinical benefit without compromising safety and tolerability. So as a quick reminder, we have previously reported independently reviewed M RECIST data for the 6 patients in the Phase I part. And among these patients, one patient actually achieved a complete response, with no viable tumor left, which is a rare event in second-line HCC. And together, with 2 partial responses, the response rate was 50% and with further 2 patients having stable disease, this resulted in a disease control rate of 83%. So we have now showed updated data with the combination that is encouraging with regards to both efficacy and tolerability. But a key question is obvious, how this data compares with what could be expected with LENVIMA alone in second-line HCC? So previously, LENVIMA hasn't been evaluated in second-line, but new published prospective data on LENVIMA monotherapy after TECENTRIQ Avastin is now becoming available. And since we do not yet have a randomized trial or randomized data on fostrox plus LENVIMA. We will do an indirect comparison with the study with the LENVIMA monotherapy data, where both investigator and independent review data will be compared. So the LENVIMA monotherapy study was performed in Japan at 10 sites, and had both first and second-line patients. And the focus today will only be on the second-line cohort. We had -- there was -- 12 patients were included and was given LENVIMA anti progression or intolerability, and could continue if the investigator deemed that the patient still had benefit despite progression. So the imaging was done 4 weeks after first dose of LENVIMA, and thereafter every 8 weeks. And as said, with limited clinical data in second-line HCC -- in second-line HC post standard of care, this data set will -- with all the limitations you can see with indirect comparison, can contribute to the understanding of the added clinical benefit of fostrox to LENVIMA. So this is the characteristics of the patients included in these studies, and they were fairly similar with the exception that the fostrox plus LENVIMA study also allowed third-line patients in and also have slightly more patients with reduced performance status. The poor prognostic factors such as extrahepatic metastases, large tumor burden and high AFP, they were similar. The primary endpoint in both these studies were safety, since they were small studies. And compared to the LENVIMA monotherapy study, no additional safety events were reported when fostrox was added to LENVIMA. The discontinuation rate, due to adverse event were similar, though there were higher number of dose modification in the LENVIMA monotherapy study. When comparing efficacy between these studies, that we can see a consistently improved benefit with fostrox plus LENVIMA across the different endpoints, regardless if it was evaluated by local investigator or an independent reviewer. This is particularly the case when it comes to the duration of efficacy as seen by the higher disease control rate at 12 weeks and at 18 or 20 weeks in the bottom table, showing evaluation made by the investigator. So achieving high disease control over time is especially important in liver cancer, as it has been shown to correlate with improved survival. The overall response rate was also higher with fostrox plus LENVIMA, including what you saw before, the patients who actually achieved a complete response. And this was not seen in the LENVIMA monotherapy study. So progression-free survival. I'm sure that you recognize this since this is a normal endpoint in Phase III studies -- is an important endpoint since it includes all patients with or without responses that could benefit from the treatment. In the fostrox plus LENVIMA study, the PFS analysis has not been done yet, but we have time to progression. And that is a similar analysis with some differences. In this study that we are comparing with TTP was similar to PFS, why an indirect comparison is possible with the fostrox LENVIMA study data. So we did that. And both with independent and investigator review data, there is a consistent improvement in PFS, TTP when fostrox is added to LENVIMA in our current study, as seen in the 2 graphs to the left. So to support this, really, we looked also at fostrox. We compare fostrox. We compare sort of the actual treatment duration, and that is the graph to the right. This is also longer in with fostrox plus LENVIMA compared to LENVIMA monotherapy, and sort of further supporting this improved benefit that you saw to the left. So then, of course, recognizing the pitfalls of doing an indirect comparison between a limited data set, we still see the totality of the data is encouraging for fostrox plus LENVIMA. And when combining 2 drugs with different antitumor mechanism and the strong rationale for synergistic activity, the improved benefit is to be sort of expected in the combination -- if the combination is tolerable. So -- we are now moving to the next exciting step in the clinical development of fostrox, but before we talk more about these plans, I would like to introduce our clinical expert in HCC and the principal investigator in the fostrox plus LENVIMA study, Dr. Jeff Evans, who will talk about HCC clinical practice today and what to expect in the future and again, how this treatment with fostrox plus LENVIMA or would potentially fit in. So, over to you. I think you are muted.

Thank you, Pia, for your very kind introduction and for the opportunity to share some thoughts about HCC treatment today and tomorrow. And can I have the next slide, please. So I think it's very important just to remind everybody about the scale [indiscernible] problem when it comes to [indiscernible] disease and a cancer of high unmet clinical need. Next slide, please. Now before 2008, most of the treatments were attempts at treating very early disease with surgical treatments or local ablation or local regional treatment. And really, systemic therapy was new agents within clinical trials. And this was before 2008 before the licensing of sorafenib. And we can see here is that -- it was quite a high proportion of patients, who in this treatment algorithm were potentially accessible to acuity treatments. That is certainly not the case in most places, and probably reflects that this was designed -- this algorithm is designed from centers that had very active HCC surveillance programs. The HCC surveillance is very patchy worldwide, and we do get interval cancers despite surveillance. And of course, the risen incidence is driven as much by nonalcoholic fatty liver disease as distinct from say viral hepatitis. And that is a much bigger group, and a group that we really have less good screening data, unless able to capture those patients as well as the ultrasound may be less sensitive than those were a history of viral hepatitis. And therefore, the predominant group these days are for those who are accessible to noncurative treatment. Next slide, please. So this is the updated staging of treatment algorithm. And I only show this to show the complexity of the disease, and how much more patients now are treated with systemic therapy than [indiscernible] being the case. And I anticipate this will only increase in the future, even if we have given it in combination with what we currently consider curative treatments. And next slide, we will circle here the -- sorry -- if we go back to the previous slide just to scroll that area, which is certain, which is what we call BCLC. This is intrahepatic liver-only disease, which is a broad group, from very small disease that might be suitable for surgery with an [indiscernible] or the majority, which is bulky disease that will never be accessible with curative treatment, and for which we really need better drugs as well as those with extrahepatic disease. I mean for this is -- speaks to the fact that treating the liver burden is very important in this disease, because a high proportion will never develop metastatic disease because it will ultimately succumb to the degree of burden of cancer within the liver. Next slide, please. Now this is what is currently approved in the U.K. We've had a number of approved regimens in the first-line, and moving from right to left, sorafenib, then lenvatinib then immunotherapy. And the general consensus worldwide is now that most patients are treated with a form of immunotherapy in the first-line. And worldwide, the biggest coverage here is atezolizumab in combination with bevacizumab. All the approved second-line trials were done with sorafenib, which is the only first-line treatment. Therefore, there is no second-line phase I -- level 1 evidence for what should be standard of care, after progression on atezolizumab, bevacizumab or for that matter on [ tremelimumab ]. The international census is that tyrosine kinase inhibitor that is sorafenib or lenvatinib would be considered as the standard of care after progression on immunotherapy. And lot of us first believe that lenvatinib although license in the first-line setting only, is a superior tyrosine kinase inhibitor. We've heard talk of LENVIMA, lenvatinib is the same compound, and I may revert to calling it E7080. I was involved in lenvatinib in the very first in-human study about 20 years ago now when it was known as D7080 and followed all the way through. And I truly believe in that drug that you have to have the potential for the time doing that development. And similarly, I believe that MIV-818 fostrox has the potential to be an active drug in this disease. Next slide, please. Excuse me. Now significant advances have been made in the first-line treatment of systemic therapy of HCC, undoubtedly atezo-bev superior to sorafenib but still associated with ultimately a disappointing prognosis. But there's a high unmet need in second-line therapy and more and more patients now are fitter and better synthetic liver disease to proceed to consider second-line therapy. And as we give more and more systemic therapy in the first-line, we do [indiscernible] test and therefore, less that's damaged to the synthetic liver function. So this represents a bigger proportion of our pieces right now. And the standard of care in my center is clinical trial. And for those where -- there is no clinical trial if they progress on atezo-bev, then lenvatinib is my usual monotherapy TKI of choice in the second-line setting. Next slide, please. So we have -- we're in oncology, whenever we can find combining 2 agents, we want to have agents without overlapping toxicity, different mechanisms of action, potential synergy in action and at least additive, if not synergistic, and we have the additional agent that targets the tumor locally, giving intrahepatic liver targeting treatment of a disease where the liver burden is clearly significant in terms of outcome even in the presence of extrahepatic disease. Next slide, please. Now there's -- I won't talk you through the signs of this, but there's a number of ways in which these 2 agents could be synergistic. That is more than additive effect of adding 2 drugs together, and adding fostrox, which has a completely different mechanism of action, intrahepatic production of a potential cytotoxic agent, overcoming some of the challenges of peripheral administration of intravenous cytotoxic chemotherapy that we've had in the past in this disease requiring hepatic metabolism, for example. Next slide, please. Now cancer in the liver is different from many other tumor types, because controlling the primary tumor in the liver is critical. But this is such an important organ in the body. And up to 80% of patients, probably higher, have underlying cirrhosis, negatively impacting the ability to tolerate antitumor treatments. We've talked about lenvatinib, but I could talk at great length about what dose we should use. Please note that the dose, which is recognized in HCC treatment in monotherapy and in combination with fostrox is less than when we use it as monotherapy in patients without cirrhosis, for example, in thyroid cancer. And therefore, progression in delivery is unique, because it goes primarily in the liver and patients may succumb to intrahepatic disease far more than even if they have small volume metastatic disease burden. And there is some improvement in long-term benefits from the met-analysis or the tests studies key mobilization in the past. However, note that many of the patients who received [indiscernible] subsequently and still worldwide, are not those who fitted the original clinical trial. For many years, we did tests because we could, rather than because it was nicely fitted the criteria as defined by the trust, because there were no suitable systemic therapy options. We now have better drugs and we do in far less tests than we did historically. Next slide, please. And one of the reasons for that is each time we do test, there's diminishing returns with a number of times we do it, in terms of getting disease controlled. And conversely, each time we do it, we can get progressive damage to synthetic liver function. So the whole question that we have wrestled with in the HCC field, who should get tested? And then once you've done it, at what point you switched to systemic therapy without overexposing pieces to a technique that ultimately can lead to liver damage, and then make them not suitable to receive systemic therapy and missed that opportunity. So we -- we do less and less tests as a frontline treatment and less and less repeated tests in those when we do test. Next slide, please. So we have potential of systemic anticancer therapy. First, let me focus today on those who are treated with systemic therapy is their primary treatment, first-line and second-line, an increasing proportion of an increasing incidence of disease of HCC, but we also have the potential to move back the way, rather than assuming that we move from curative treatment through to local regional that systemic therapy. But also to think with systemic therapy adds on to local regional therapy, TACE RFA or even substituted if we have a liver activity -- liver prodrug tumor treatments such as fostrox. And then in those who are suitable for surgery with or without transplantation, and clearly, if they are suitable for transplantation, we cannot use immunotherapy because of the fear of subsequent organ rejection. Clearly, we have now studies where we will look at these combinations and novel agents in either the pre or postoperative reception including transplantation. Therefore, I think the that market share of systemic anticancer therapy is increasing within the standard treatment algorithm, and will only increase as we added in earlier and earlier in the management of this disease. And with that, I'm happy to hand back to Pia.

Thank you so much, Dr. Evans. There's very much highlights, really the unmet need in second-line HCC, and is providing the context for where would fostrox plus LENVIMA fit in? Where could we find the biggest benefit? And with this clear picture of the unmet need, together with the promising clinical data that we showed before for fostrox plus LENVIMA, we feel confident to raise our ambition when it comes to the clinical development of fostrox, as we conclude that a Phase IIb study with an accelerated approval in 2021, is the appropriate next step. So one important key factor enabling this accelerated approval -- it's already in place. You heard that, right? It is that HCC is a serious life-threatening disease with high medical unmet need. The second part is really to see that we replicate the magnitude of the promising data from the ongoing Phase Ib/II study in a randomized Phase IIb study, as seen on this slide. And the randomized study design comparing fostrox plus LENVIMA with LENVIMA alone also incorporates the FDA regulatory acceptable endpoint already in this phase in Phase IIb, and that is PFS. And an appropriate safety database to further support the aim for accelerated approval in 2027, we need to make sure that, that is also in place. So I will hand it over to Jens.

Thank you, Pia. Exciting opportunity for fostrox to break -- fostrox to break new ground in second-line liver cancer. Let's look at what this means for the commercial opportunity. The potential to become the first approved treatment with level 1 evidence after TECENTRIQ plus Avastin, and transform the treatment of second-line liver cancer, clearly has a substantial impact on the commercial opportunity. The left-hand side of the slide shows the sort of estimated market value and growth in the coming 10-plus years. And as you can see, it grows significantly and it reaches almost $2.5 billion by 2028. On the right, we are showing the key assumption that underpins the market value, and there are a few elements to highlight. And as you heard from Dr. Evans before, so that the treatment options in first-line get better. And that means that more and more patients will get systemic treatment in second-line, and with better treatments, the duration of treatment will also increase in second-line as well, 2 factors that have a significant impact here. Another, of course, very important factor from an opportunity perspective is the fact that there are no medical treatments approved regulatory today after TECENTRIQ Avastin. And when we look ahead, there is a high likelihood that this situation will not change dramatically, as relatively little development is taking place in second-line, outside of sort of what we're doing at the moment with fostrox plus LENVIMA. So that means that the fostrox, in combination with LENVIMA, has a very realistic potential to become the first approved treatment alternative in second-line, after TECENTRIQ Avastin. And I think, as Jeff -- Dr. Evans alluded to, when it was approved in first-line 2020, that combination had a transformational impact on the treatment for patients and very quickly became standard of care. If approved as the first treatment in the second-line setting, it would be quite natural for a combination of fostrox plus LENVIMA to have a similar transformational impact in this population. We do see second-line as our, if you want to call it, fast-to-market strategy for fostrox. But sort of, again, building on what Dr. Evans sort of outlined earlier, a liver-directed product like fostrox would likely provide sort of perhaps even greater benefit in an earlier setting, where patients have less tumor spread outside of the liver. Hence, we do see first-line and in intermediate stage HCC as a next step opportunity for fostrox -- populations that would then clearly add sort of significant commercial opportunity on top of second-line. So to sum up then, before we go to Q&A, I go back to the points I made in the beginning, just to reiterate them. What we have hopefully shown today is that the combination of fostrox plus LENVIMA does show improved clinical efficacy compared with LENVIMA study data without compromising on safety and tolerability, and that there is a very realistic opportunity for the combination to move ahead with speed, aiming for an accelerated approval as early as 2027, if the magnitude of the data can be replicated in Phase IIb, of course. And then finally, fostrox together with LENVIMA has the potential to transform a $2.5 billion market without significant competition and low commercial risk. With that, so thank you for listening, and we now open up for Q&A.

[Operator Instructions] The next question comes from Joe Pantginis from H.C. Wainwright.

Hi, everybody Thank you very much for all the details today and a very exciting data update. So thanks for everything. So a few questions, if you don't mind. So first, I just want to go back chronologically. From the Phase Ib, the external assessment that there was a CR patient, just wanted to get a sense of what the status is for that patient currently?

So without going into too much detail, this patient is still ongoing.

That's actually great to hear. And then, I guess I wanted to get maybe Dr. Evans views on the data update today and the broader profile of fostrox here. So first, I guess I don't want to overemphasize it, but when you look at the patient population, being all 100% of the patients having seen prior progression on their prior therapies, maybe talk a little bit more about the importance of these data and responses that you're seeing, since these are all prior progressors that the fact that seeing responses -- the importance of seeing responses once you've seen these progression. And. Then more overall, where Dr. Evans might see, and I know he alluded to it a little bit in his prepared comments, where fostrox could really fit in the broader opportunity, especially when in the Phase IIb data readout for potential accelerated approval.

Yes. Thank you. So I'll take the first question. So yes, these are all patients. To enter into a second-line trial, you have to progress after first-line treatment. And that is entirely standard for when we get studies in any line of treatment of any tumor, not necessarily HCC. This is -- we've never developed this as a maintenance therapy, and that's being far between in oncology practice, as you probably know. So in terms of responses, yes, responses do matter. That's a question that's been asked for the HCC field. It seems somewhat obvious and self-evident to say so. But there was some controversy many years ago with -- so there was controversy many years ago, but where the responses were important to the synthetic liver function and controlling the disease. But we're now fairly convinced, if you look at the data that we published from the post [indiscernible] study that clearly responses but irrespective of which [indiscernible] the patients were in. So responses are matter patients, we treat the tumor burden, where you maintain patients. Therefore, symptoms and quality of life annals for the synthetic liver function are important, because then it gives better disease control, better survival, theoretically. May even facilitate third-line treatments, which we begin to think about increases in clinical trials at present. And therefore, it is certainly significant finding. If you look at the response rates generally in HCC, unless stick to RECIST 1.1 when we're talking response rates now. I mean, getting responses are still remain the [ minority ] of patients with systemic therapy. I'm getting feedback actually of this. So I'm not sure if anybody else has got the audio on. It's -- it's an important thing to aim for is responses, as the 2 responses are generally speaking, be relatively low with systemic therapy in first-line and second-line therapy. And each time we treat people, I guess, less use time. Now the second question is, does this fit in the treatment algorithm? Well, it's great that we got a lot of new drugs that have been approved in mainly first-line in the last few years in HCC. There's plenty of room for development. This is still a disease that's got an overall disappointing survival. And we've got something different, because most of the developments so far have been on TKIs or TKI combinations, which is obviosuly tyrosine kinase inhibitors, lenvatinib, sorafenib, cabo et cetera, and on novel ways of targeted immune system. In the future, we may be putting these drugs together. And here, we have a drug that is cytotoxic in activity, but without the disadvantage that we used to see of the intravenous cytotoxic chemotherapy in the pre-sorafenib days back in the 20-odd years ago. And allows conventional combinability with other systemic therapies without overlapping toxicities or mechanisms of actions, as well as giving a potential to reduce the tumor bulk within the liver, and we can speculate, and it is only speculation at this point, where they could remove some of the local regional therapies that are invasive such as TS, for example, without the need for interventional radiology. But that is speculating, but we would -- that's the direction of travel we'd love to go in this disease.

That's very helpful. I really appreciate the comments. And I guess, 2 quick, I guess, logistical or MOA questions, if you don't mind. So when you look at the spider plot, I was just curious if you have any theories or hypotheses, there are a couple of patients that have, I guess, relatively quick rebounds in the 6- to 12-week timeframe, about why you think they might be fast progressors, #1. And then #2, my last question is, where do you feel business development might fit in to the conduct of the upcoming Phase IIb randomized study?

Pia, the first one is for you?

Okay. The first one, where we see -- I mean, the HCC, and we can introduce Dr. Evans in this as well, is it is a heterogeneity in the patient that has HCC. There are different ideology, as Dr. Evans talked about, but also different molecular features. And actually, have again going into too much detail, some of the patients that responded really quickly, and with a 90% reduction actually in the tumor size. They had a transformation into another type of HCC that is more aggressive. So while we are looking into these different patients carefully and hope to present more in detailed data on the future congress, I cannot speak more about the individual patients at this time point.

I would add a generic comment at that point. I won't deal with the business development side of things, but I will give a generic comment on HCC, predictors of responses and [ progressors ]. This is something we've been wrestling within the field, not just in HCC, but in all the tumors, but particularly in HCC for a while now. And I guess we don't really have good biomarkers of who's going to benefit from a specific treatment. And what is fairly heterogeneous disease and in [indiscernible] with other tumor types, and I treated other tumor types as well, we've been somewhat slow to come to as a HCC field generically with len, sorafenib, atezo-bev, [indiscernible] in trying to tease out biomarkers that will predict for who's going to respond and the mechanism of rapid progressor. And I think there's a very good reason for that, actually, in that it's the porosity of tissue with which we can work with, because historically, this is a disease that's been made radiologically. And therefore, we probably as a field need to concentrate more on getting -- an on-treatment biopsies in this disease, so we can learn more about the biology, as you suggest. And this is the international direction of travel now for those of us who work in the HCC field are very much committed to getting more biopsies. And clearly, we've got biopsies in the study, and this is how we need to do it in the future.

And I'll take the business development question then. And we have communicated, Joe, I think, sort of for quite some time that we are envisioning sort of the development of fostrox going forward in Asia in partnership, i.e., we will be looking for a partner to take this forward in the Asian markets. The maturity of the data that we're seeing now and the strength of the data is basically that, that opens the door to those discussions. So it's been clear previously that feedback has been theoretically and logically high interest in a liver-directed, liver-targeted drug, but there's always the question of what does it, sort of when you combine safety, tolerability, clinically, et cetera. Now that we have the majority of the patients sort of followed up for more than 12 weeks and the maturity of that, it sort of -- that opens the door to those sort of deeper dive discussions with regards to partnerships going forward. So definitely, it does have a place from a business development perspective going forward with the first aim of finding an Asian partner to take this forward.

The next question comes from Richard Ramanius from Redeye.

To start, just a quick question about Tango Therapeutics. Will they -- do you think they will start the trial this year? And should that lead to an income from a milestone payment?

Short question. I think they've been relatively clear that they are looking to start it in the first half of 2024. That's the communication that we have seen. So I would anticipate first half of 2024, that I would expect. What we have said is that the start of the Phase I program does incur a milestone payment, but we haven't sort of talked about the size of that milestone payment.

Okay. And I was also thinking about funding situation in relation to partner discussions, because might it be useful to strengthen the cash position while negotiating? And do you think you could do that. I mean, that would not be at large sum just to finance continuing operations. Could that be possible through a directed rights issue to perhaps the main shareholders or a loan or something like that?

Financial question, we hand that to Magnus.

Thank you, Richard. Yes. I mean, the guidance I can give you now is that we are really looking at different options, alternatives that we have at the moment. And of course, that could be an option as well. But I can't give you any more guidance on that. But as we're getting more data and more than 50% of patients still on treatment in the Phase IIa, I mean, it's a balancing act. I mean, we have encouraging positive data, but of course, it's good to have money on the bank so we can start activities. But we come back when we have made a formal decision on the next step from the financial viewpoint.

Okay. Also I wonder about the -- what RECIST version the LENVIMA benchmark used in the -- these 12 of the patients that Pia talked about, is that RECIST 1.1?

Yes. So they actually used 4 different measures. They used investigator assessed RECIST 1.1 and also this modified RECIST and so did the independent reviewer. So we were trying to compare with what sort of -- where we could have the most patients that looked similar to each other that is the comparison you saw. Please do and come back with questions.

I think we've tried to be as disciplined as possibly can to sort of compare RECIST 1.1 with RECIST 1.1 and modified RECIST with modified RECIST because I think -- would that be a fair statement?

That is definitely a fair statement. And that's why we show this smaller patient cohort also of 6 patients because obviously, we are waiting for our data, and we are waiting for analysis to be independent, but we will not share that here today because we hope to have that published on future Congress.

The next question comes from Klas Palin from Erik Penser Bank.

And I would like to start the question about this pivotal trial that you are planning for. I need to clarify, is this a start that you are -- where you are intending to recruit patients globally? Or is it purely in Europe and America?

Thanks for that question. And that is a global trial. So we haven't selected exactly what countries we are going to go to, but definitely include Europe, Asia and the U.S. potentially as well. We need to include U.S.

Don't say potentially. U.S. definitely.

Yes, I was trying to be a little bit careful, but U.S. definitely. Absolutely.