Vicore Pharma Holding AB (publ) (VICO) Earnings Call Transcript & Summary

Good morning, and welcome to the Vicore Pharma KOL webinar on C21 for the treatment of idiopathic pulmonary fibrosis. [Operator Instructions] I'd now like to turn the call over to your host, Carl-Johan Dalsgaard, Chief Executive Officer of Vicore. Please go ahead, Carl-Johan.

Thank you very much, Tara. I'm Carl-Johan Dalsgaard, the CEO of Vicore Pharma, and I want to welcome you all to this key opinion leader webinar on C21 and IPF and the study that we are conducting. After my first short introduction, I will hand over to Professor, Toby Maher, who will guide you through the disease and the trajectory and the treatments available today and studies done. Then our CMO, Dr. Rohit Batta, will describe our compound C21 in relation to IPF. And finally, Professor Joanna Porter will describe the study that we are now conducting the Phase II trial, the AIR study. If we can have the next slide, please. So this is the forward-looking statement that I think you're all familiar with, and then the next slide. I want to start with just one slide to give the prospects of the patient to get the diagnosis of IPF. In that situation, they are now informed that the prospects is worse than most any cancer, it is a less than 50% 5-year survival after diagnosis. And they will never feel any improvement in their symptoms that they're seeking for, which is dyspnea, cough, pain, but the reduction of quality of life and symptoms will go a bit slower, but no time will be for improvement. And of course, the standard of care today have contributed to the benefit of the patients by reducing the deterioration, but it comes also at a price and the self-reported gastro intestine side effects include nausea, vomiting, diarrhea, weight loss, appetite loss. So they're facing a short life expectancy with poor quality of life after diagnosis. There will be no symptomatic improvement whatsoever. And if they're unlucky, they will have unbearable GI side effects. So all in all, I think there still is a huge unmet medical need in this disease. And I will now hand over to Toby to describe the disease for you.

Great. Thanks, Carl-Johan. So hi, everyone. I'm Toby Maher, Professor of Medicine and Director of the Interstitial Lung Disease Unit at the University of Southern California and Los Angeles. So what I want to talk to you about over the next 15 minutes is just to give you some background on IPF, the disease that we're dealing with, some insights into the current treatments and where we have room for improvement. And then a little bit of insight into clinical trial design in IPF and where we are with that at the moment. So IPF is a disease that's characterized by progressive fibrotic destruction of the lung, characteristically occurs in older adults, more often males than females. This pair of CTs here is the same patient on the left-hand side of diagnosis, on the right-hand side, 18 months later. And you can perhaps appreciate the fibrotic change, which progresses very rapidly over time in this individual. And if I show you the next slide, this is what we see when we look at IPF under the microscope. On the left-hand side, we've got normal lung tissue, which has the beautiful lace-like architecture of the lung designed perfectly for gas exchange. On the right-hand side, we have fibrotic tissue from an individual with idiopathic pulmonary fibrosis. All the pink stuff is scar tissue and what you perhaps recognize towards the bottom of the slide is that we've lost the normal structure of the lung and instead, it's been replaced by these cystic air spaces, which have become full of mucus. And when you look at this, it always seems obvious to me why it is that patients get symptom, and they die. It is because the lung loses its gas exchange surface area. It gets replaced by scar tissue. And really, the challenge we have when treating pulmonary fibrosis is to find a way to prevent progression of this scar tissue over time. And so where are we in terms of the disease at the moment? Well, it is a disease that's becoming more common. If we go back to the 1990s and we take the United Kingdom as a reference example, in the UK, there were about 2,500 new cases of IPF in 1990. By the year 2020, there were over 6,000 new cases a year. We don't fully understand what it is that's driving that change in incidents, but it's quite clear that it is a disease that's becoming increasingly important. And when you actually look at causes of death in the United Kingdom, IPF causes well over 5,000 deaths a year. That is out of 0.5 million deaths per year in the UK. if you do the math, that's 1%. So 1 in every 100 people who dies in the United Kingdom ultimately dies of fibrotic lung disease. And just to reiterate something that Carl-Johan already said that the outcome for people with IPF is as bad as many cancers. The graph on the right-hand side here, contrast, the 5 year survival, the 5-year untreated survival of IPF with many of the more common malignancies. And you can see that with a 25% 5 year survival, IPF is on the bad, right-hand side of the graph with diseases like esophageal and pancreatic cancer and cancer of the lung. So what can we offer to our patients when we see them? Well, historically, we've been able to offer lung transplants. Again, United Kingdom as an example. The UK does about 300 lung transplants a year. And I've already told you, there are 6,500 new IPF diagnosis. Then, of course, there are all the other respiratory diseases. And so you can again see from the numbers that transplant is not something that we can offer to every patient. In fact, patients are very lucky if they are able to get the opportunity to be transplanted. And other things feed into that, including comorbidities and age, which often act as barriers for transplant. And so really, we need better medical therapy for our patients with IPF, given that transplant is not a realistic option for the majority. And so thankfully, in 2014, we saw the publication, not just 1 but 2 pivotal trials in the IPF space. I'm sure these are familiar to everybody. We saw the pirfenidone trials that had been the original capacity trials, and these were followed by the ASCEND trial. And for nintedanib, we saw the INPULSIS trials. And ultimately, these trials led on to the approval of both drugs worldwide for the treatment of idiopathic pulmonary fibrosis. And as you can see from the data on the slide, both drugs appear to slow decline in lung function, decline in FVC by about 50% over 1 year. And 7 years on from those studies, we have now had the opportunity to look at real-world efficacy. And the 2 graphs on the left-hand side of this slide come from registry data, the top 1 from Australia, the bottom one from Europe. There have been subsequent studies from elsewhere around the world, including the US and all of them consistently show the same thing, which is patients treated with antifibrotic drugs haven't improved survival compared to patients who are not. So we have shifted the dial on mortality. However, I would draw your attention to the graph on the right-hand side. This is a study I undertook with several colleagues, where we looked at patients who've been in the original pirfenidone pivotal trials who carried on to receive pirfenidone for up to a decade afterwards in open-label studies. And what we did was compare their survival to a historic data set. And age, gender and disease severity matched. Those patients and so to talk you through the lines on the graph, the first-line as we move across the graph from left to right is the survival of the age and severity matched patients because patients in clinical trials tend to have milder disease. These patients had a median survival of just over 5 years. The next line across on the graph, signified by the dark blue area beneath it is the survival of the patients who received long-term therapy with pirfenidone. And you can see that their median survival has shifted to 8 years. So potentially, we're buying these patients 2.5, 3 years extra life expectancy with treatment. However, if we look at the final line on the graph, that is the median survival for a 67-year-old drawn at random from the general population. And what this tells us is that someone newly diagnosed with IPF is losing about 15 to 18 years of life expectancy. And although we are gaining some of that back with anti-fibrotic therapy, those patients are still expected to lose 12 or more years of life expectancy because of their disease. So we've still got a long way to go before we restore normal life expectancy. So how can we do that? Well, there's some discussion about combining treatments and using combination therapy in the future. That has been tried with the current 2 drugs. And this just highlights one of the difficulties we have in clinical practice, which is to say that both drugs, although generally safe, have a... [Audio Gap] side effect profiles, which mean that in real-world practice, about 25% of patients at least end up discontinuing treatment within the first year. In combination trials, we saw enhanced efficacy of the 2 drugs together, but we also saw an unacceptable rate of side effects despite patients going into the study for one treatment. By the end of 3 months, 50% of patients had discontinued from the study and had stopped at least one of the drugs that they were taking because of side effects. So pivoting now to trial design. There have been a number of things that have been important in helping us develop new treatments for IPF for over the last 20 years. The first one was the classification of disease. Before the turn of the century, we really didn't classify disease in the way that we do now. Instead, we lumped together all forms of fibrosis. And it took the appreciation that there were different appearances, both histologically and radiographically and those translated into different survival outcomes for patients for the pulmonary fibrosis field to really get together and come up with a classification scheme. And I'm not going to go into this slide in detail, but it just gives a broad overview of how we now classify different forms of diseases that affect the interstitium of the lung and these incorporate many fibrotic lung diseases. And we now separately classify idiopathic pulmonary fibrosis. And that separate classification of IPF was important because it allowed us to better understand and the natural history of the disease. It also allowed us to better define patients that fall into that diagnostic category, and that's been important for clinical trials because we can use the CT scan appearance and central reading of that appearance to make sure that we have a homogeneous trial population that we're studying. And of course, it has separated IPF out from diseases with a better prognosis and a more indolent disease course. The first clinical trials in IPF for the first multicenter international trials really only started in the late 1990s. The first of these was with... [Audio Gap] interferon. And I put this up just because looking back, the primary endpoint looks slightly unusual. It included change in AA gradient, which required measuring arterial blood gases, something rather unpleasant and uncomfortable for patients. The important learning from this study was that, that really wasn't a good and reliable endpoint. And it took another 15 years before we settled on force vital capacity as the primary endpoint of choice. In fact, the first pirfenidone trials were the ones that initially used force vital capacity is their primary endpoint. That was refined further in the first study with nintedanib, the 2B TOMORROW study, where they introduced central reading and standardization of spirometers as sort of the next step forward in development. And now we're in a position where all IPF trials will use FVC as their primary endpoint of choice for using efficacy. There are a number of reasons we do that. FVC is very easy to standardize. It is a real reliable and reproducible measurement. And we know that it relates as a surrogate measure to survival and longer-term outcomes and importance to our patients. And the introduction of standardized barometers and central overread has really gone a long way to reduce measurement error and really to tighten the value of force vital capacity as a primary endpoint in IPF studies. And that is reflected by the regulator's viewpoint, after the approval of pirfenidone and nintedanib, the FDA published this viewpoint in the New England Journal, really reiterating why it was that they chose to approve both drugs based on changes in forced vital capacity. And again, reiterating their belief that rate of change in forced vital capacity is truly a surrogate measure of longer-term outcome in patients with pulmonary fibrosis. So really, we now understand how to run successful regulatory studies for IPF. We need a guideline based diagnosis of IPF, and that involves central adjudication of the CT and where necessary, the biopsy by a central radiologist and pathologist. And that really allows us to filter out cases that are not IPF and that are not going to behave like IPF. And now we use change in FVC as our marker of efficacy in pivotal trials, we'll tend to run it for 52 weeks in early phase trials. We know that we can see change perhaps as early as 3 months, but certainly reliably all by 6 months. And of course, the introduction of standardized parameters with central overreading results really allows us to control the primary endpoint data. And then finally, just to think about how IPF populations behave. We do recognize that once we've diagnosed patients with IPF, there is some heterogeneity in disease behavior. This is a study where we monitored home lung function in patients with IPF. So the 2 graphs on the right in the left represent individual patients who've measured their force vital capacity every day for up to 18 months. On the left-hand side, we have a patient with relatively slow disease progression. You can see this day-by-day variability, but there is also decline over the 18 months. On the right-hand side, we have an individual with much more aggressive disease who sadly died after 220 days, but you can see how his disease trajectory is different. However, at the population level, actually IPF behaves very predictably. This is the population of patients who partook in that previous study with the home spirometry. Each line on the graph is the regression line for each individual's meetings over 52 weeks. And the red line represents the mean change, which was approximately 9% over the 52 weeks, which equates to somewhere between 200, 250 milliliters. And when we look back at completed Phase III trials, what we see in the placebo group is that fairly consistently patients will lose between 220 to 240 milliliters per year. The major differences that we've seen historically have related to differences in statistical handling of missing measures. If we look back at the pivotal pirfenidone and nintedanib trials, we see apparent big differences in the behavior of the placebo groups. But in reality, that was driven by very different handling of missing data in the nintedanib trials, mixed effect models we used, which integrated all data. And so there wasn't a penalty for missing data. However, in the pirfenidone trials, missing subjects we're giving a value of 0. And so patients who died or transplanted automatically dragged down the rate of change in patient groups. When you take that into account and use them... [Audio Gap] model, you actually find that the populations of patients behave almost identically between the studies. So to summarize what I've said, IPF is a nasty progressive and ultimately fatal disease. And thankfully, we do have treatments available now. We have anti-fibrotic drugs. We have demonstrated that it's possible to modulate fibrosis. We have a pathway to approval. The challenge is that those 2 drugs that we have are in at least 25% to 75% of our patients poorly tolerated. And as I've shown you, although they improve life expectancy, they don't restore a normal life expectancy to patients diagnosed with IPF. We've come a long way in 20 years in designing studies. We recognize the importance of forced vital capacity as a primary endpoint of choice. And as I've just told you, in cohorts of IPF subjects with centrally overread CT scans, we can expect very consistent population behavior in FVC decline, which, of course, opens the opportunity for the sort of trial design that you're going to hear about from the next few speakers. So that leaves it for me to pass on to Dr. Rohit Batta, Chief Medical Officer, who's now going to talk to you now about C21 in IPF.

That's great. Thanks, Toby. So I hope you can hear me okay. So from a professional background perspective by my physician of over 21 years, I'm a King's College London, alumni, and I continue to teach there as a visiting senior lecturer. I'm a generalist by training, and I've been in the life sciences industry for over 16 years, the vast majority of that time developing medicines for rare diseases. And so just to start, so Carl-Johan and Toby eloquently described the problem facing patients today. And so how do we plan to solve this at Vicore Pharma? Well, we aim to bring novel therapeutic solutions to patients so that we can remove the suffering caused by rare fibrotic lung diseases. And we're really looking at the disease in a 360 degrees way. We're trying to position ourselves as a one-stop shop. Really, it's about stopping that disease progression, stabilizing the disease, alleviating the cough, which causes a great deal of frustration for patients and then also the associated mental health burden, if you can imagine, being diagnosed with a terminal disease. So we aim to solve these problems and bring our medical breakthrough to patients. You can go to the next slide. So this is our pipeline. And you'll see that we're attacking the disease from all angles: land, sea, air and so on. And this gives us the best chances of really understanding the disease and bringing something of value to patients. So I'll start at the top with VP01 and C21, the medicine. And that's our pathfinder. This is the one we took into clinic first. And with IPF, I'll talk about some of the recent successes, such as the precision cut lung slices, ex-vivo experiment that we conducted. And this is not some abstract model with limited predictability, but slices from human IPF lung, and we showed a reduction in TGF beta, which is unarguably the key driver of fibrosis. And then we're also making good progress with the Phase II IPF AIR study, and I'll talk a little bit further about that. The next is COVID-19, and we had a gratifying result with the Phase II ATTRACT study, where we show that C21 accelerates resolution of COVID-19. Now we've started the Phase III study. And they say that development is not a sprint or a marathon. But with COVID-19, it certainly does feel like a sprint, and we're on track to complete the recruitment by the end of the year, which will obviously be a key milestone for the company. So next is VP02, and we're tackling, which really tackles the distressing and disabling IPF cough, which is refractory to current medical therapy other than oral thalidomide, but which comes with a significant side burden. And the therapeutic proposition with VP02 is really an inhaled version of thalidomide, where we aim to increase the local lung exposure, decrease the systemic exposure and obviously decreased the side effects, and the aim is to bring this to the clinic by early next year. The value proposition is that it could not only impact the cough, but the disease itself and then obviously bring an improved safety profile as well. The next is VP03, and you'll hear from my talk that we like the angiotensin 2 receptor platform a lot. It holds great promise and it could unlock many diseases, and it's potentially very well differentiated. So we're performing deep exploration and vigorous screening through our collaborations, and we aim to start human studies by the end of this year. So VP04 all right at the bottom of the slide there. So in the whole sort of sea of digital health apps on your iPhone or your Android device, only a fraction of those are actually validated using a robust clinical study. And these are called digital therapeutics, and they're recognized by many regulators such as the FDA and payer bodies such as NICE. And our aim is to develop our own personalized cognitive behavioral therapy-based DTx and to have that in the clinic next year. This will be our trail glazer, and it's not hard to imagine the emergence of very different health care system powered by digital therapies over the next 3 to 5 years. So hopefully, you can visualize this 360 degrees view that we're taking, and we're obviously putting the patient at the heart of everything that we're doing. Go to the next slide. So the renin angiotensin system. So the discovery of the RAS was one of the most important findings in physiology. An actual fact, renin was discovered about 120 years ago when science was being democratized and not too far away from the Vicore headquarters at the Karolinska Institute. And researchers there were fascinated by its role in controlling arterial blood pressure, which then led to powerful treatment for hypertension, heart failure, diabetes and other diseases. And that's shown here on the left-hand side of this picture, the constitutive arm mediated through the angiotensin 1 one receptor. Now in recent years, it was firmly established that apart from this, there's an opposing inducible arm mediated through the angiotensin 2 receptor, which has anti-fibrotic, immunomodulatory, vasodilatory and regenerative actions. Now C21 has high affinity for the angiotensin 2 receptor combating the deleterious effect of the angiotensin 1 one receptor. Now the RAS has also been recently sensationalized by COVID-19 because we know that the virus uses ACE2 to gain entry into cells. Go to the next slide. So how do we think C21 is working? Well, it was recently described that the angiotensin 2 receptor is highly expressed on a key cell type in the lung, the alveolar epithelial type 2 cell. And these cells are a bit of a worker bee, the defender of the alveolar colony, but they also have multiple tasks unlike the alveolar epithelial type 1 cell, which could be described as the queen bee. And you'll see this in the picture here that they have -- they are stem cells for the damaged and aged alveolar epithelial type 1 cells, and they're also producing much-needed surfactant. Now these cells can also go AWOL, they can become dysfunctional and it's known in IPF that it's a disorder of epithelial cell dysfunction. And it's thought that stimulation of the angiotensin 2 receptor on such cells by C21 serves to promote a proliferative effect in this damaged lung tissue, which could reverse this cell dysfunction and sort of prove as a possible reparatory mechanism. Go to the next slide. So here are some of the other things we know about C21. And firstly, it's not a new kid on the block. This growing body of evidence from numerous studies, there's only a few listed here, but there's actually over 100, showing consistent results on healing, parameters such as fibrosis. And this has sort of created a bit of a central thesis. And one of these is the bleomycin rat model. And despite its limitations, it's still the most widely used preclinical study for human IPF. And you can see on the left-hand side, the C21 protected against pulmonary fibrosis. However, rats are not humans, and we wanted to understand to see if we could see the same effect in humans. And we worked with a group in Newcastle, who are pioneers in precision-cut lung slices. Now they can keep a human organ slice active for 7 days, sort of retaining that 3-dimensional structure and the extracellular matrix composition. And here we show that C21 attenuates in a dose-related manner, the expression of TGF beta 1, which is a master regulator of fibrosis in IPF lung tissue. Go to the next slide. And here is another condition we've been trying to understand is pulmonary hypertension. And this is sort of described as the cardiologist cancer because it carries a very poor prognosis and remains a fatal disease. And is defined as an increased pressure in the pulmonary vasculature and is classified into different groups depending on etiology, such as institutional lung diseases. And about up to 60% of IPF patients can have PH at an early stage, and it's a predictor of mortality. So much so the transplant teams use it as a sort of a reason for a lung transplant. And many preclinical models are sort of out there. However, the Sugen hypoxic model is really used to filter out those next level pH medicines. And the reason being is that the Sugen hypoxic model has these plexiform lesions, this sort of increase in muscularization in those vessels that you don't see in the classical models. And that's sort of reminiscent of the human disease. And we've been working with renowned PH experts. And what we found was that C21 not only reduces the pulmonary artery pressure in human equivalent doses, but also reduces that pulmonary remodeling I spoke about. And that replaces C21 in a very favorable position as a treatment for Group III pulmonary hypertension IOD, the type that affects IPF patients. If you go to the next slide. So just to recap here. So firstly, C21 is outside the classical mold of antifibrotics. It has this dual impact. It's not just tackling the fibrosis but also the PH. The second point is that we've improved our drug discovery or development ops by demonstrating that C21 does have anti-fibrotic effects in human IPF lung. The third point is that compared to other anti fibrotics in development, which are such as the FibroGen and Roche's medicines, which are intravenous, C21 can be taken orally at home, has rapid absorption, adequate exposure in the lung. #4 is that, as you heard from Toby, is one of the largest challenges with approved anti-fibrotics is that GI intolerance. Up to 70% of patients suffer it, about 25% discontinue or take suboptimal doses. C21 has no signs of any GI intolerance. #5 is that following on from our pulmonary hypertension work with the Sugen model, we've actually performed a Phase II mechanistic single-dose study in patients with systemic sclerosis, who have tough peripheral resistance vessels. They have secondary renal phenomenon. And there, we found that C21 does indeed have a vasodilatory effect, which further strengthens our case in pulmonary hypertension. And the sixth and seventh points I'll go through on the next slide as it is related to COVID-19. Go to the next slide. So if you rewind sort of to the start of the pandemic, when we serendipitously decided to go after COVID-19, we had 2 aims. One was to adopt a gold standard RCT design because it was starting to become a bit of the wild west. And two, we wanted a homogeneous population at a burning point, but not too far off, not too close to the cliff. And at that time, we heard that CRP predicted severe outcomes in COVID-19. But in some ways, it was a double-edged sort. On one, it helped us to enrich the population, and we used it as a primary endpoint for the study. But on the other side, the recovery data came along, showing that steroids were beneficial. And between sort of baseline and randomization, the CRP came -- sorry, screening and randomization, the CRP came right down. And there wasn't really much sort of space for C21 to show a difference. So we missed the primary endpoint there. However, the hallmark of COVID-19 is progressive hypoxia. It's an independent risk factor for mortality. And C21 reduced the risk of supplemental oxygen. On day 8, you can see in the graph, 58%, 19 versus 8 subjects. And then on day 14, now this is 1 week after IMP, it was a 90% reduction. So these are all statistically significant. And then there were also numerical reductions in mechanical ventilation 4 versus 1 and deaths 3 versus 1, combined with a good safety and tolerability profile. So that shows that C21 is restoring alveolar function in COVID-19. Go to the next slide. Okay. So now to idiopathic pulmonary fibrosis again. So I've heard Toby describe IPF as the lung equivalent of Alzheimer's disease. And the lung is aging much faster than the rest of the body, 240 ml much faster FEC decline. And this has been demonstrated time and time again, and Toby covered that in his talk. And we really designed this study sort of based on this carefully applied historic. And you can see that in the graph here. So on the green is the natural history trajectory and standard of care, the likes of nintedanib and pirfenidone in half this and sort of the white space for C21 is to have better efficacy. In this case, the orange space, but is to have demonstrate better efficacy and better safety and tolerability. And that's essentially really what the trial is doing in terms of outcomes. It's a multicenter study. It's open-label, so we removed the placebo lottery there. And 60 patients with IPF will be confirming the diagnosis with historic scans, which are sent to the Brompton for reading. It's a 9-month study. And the primary efficacy end point is at 6 months, again, using this carefully sort of applied historic control arm, and we have greater than 80% power to detect a clinically meaningful difference. The topline data is expected by quarter 4, 2022. And the study is on track. And we've actually had 2 data monitoring committees. This is a committee that's independent to the trial team. They review the safety data. And they've had 2 meetings, and they've indicated that there's no new safety signals and the study can continue as planned. If you go to the next slide. This is my last slide now. So in summary, with -- we're in the business of developing life-altering treatments for patients with rare fibrotic lung diseases. And there's a massive unmet need in IPF. Antifibrotics, they slow down the disease, but they have no impact on the quality of life. If anything, they're making it worse with the GI intolerance. Now C21 is an angiotensin 2 receptor agonist. And we have these dysfunctional alveolar epithelial type 2 cells, which are the spark plug in IPF. And we now know that the receptor, the AT2R, the target for C21 is exclusively expressed on this cell type. We also know that C21 packs a good punch. It has that dual impact on the fibrosis and from the PH perspective, the pulmonary hypertension, it has no GI intolerance issues that we've found. It has good safety and tolerability. And on top of that, with the COVID ATTRACT study, we've clinically demonstrated the relevance of the AT2R in human disease of lung injury. And with that, I will stop there and hand over to Professor Joe Porter.

Thank you very much, Rohit. I'm Joe Porter. I'm a Professor of Respirator Medicine at University College London, but I also head the National Interstitial Lung Disease service at UCLH. And I'm the Medical Director of the Breathing Matters charity. I do research, and I have been in touch with Vicore already about this study since 2014. And I'm absolutely delighted that having seen C21 right through from preclinical data that we are finally going to do a study in patients with idiopathic pulmonary fibrosis. So this is my hospital, UCLH. The AIR study is our early phase, multicenter. We're carrying out this study in countries throughout the world, actually, hoping to recruit 60 patients with idiopathic pulmonary fibrosis. And the idea of it being most centers that we will know that our results are generalizable to very different health care systems. The hospital I'm showing you, actually, the patients won't have to attend the hospital very frequently because, as Rohit has already said, C21 is an orally active agent, which means that it can be taken easily at home without requiring hospital visits for complicated infusions. And actually, this makes it a really attractive study, both for the health care system and for the patients. So you've seen the design of the study. 60 patients will be recruited. And every 3 months, the patients will visit the hospital for a treatment evaluation and with 4 more spirometry. So they'll come actually to the hospital that have in clinic spirometry, which I think is a really nice part of the study is that at 12 weeks, the patients together with their treating clinicians can decide whether they want to continue with the study or whether they want to withdraw. And this is important because the patients who we selecting are patients with mild to moderate idiopathic pulmonary fibrosis. And in the U.K., these patients who have a forced vital capacity greater than 80% predicted and not eligible for antifibrotics on the NHS. So these patients really have nothing until their lung function has declined sufficiently to put them in a situation where they can be treated by the NHS. So it's wonderful for us that we can offer our patients an active treatment and that they will be evaluated regularly throughout the treatment course if they should change their minds and want to move out of the C21 study and onto an anti-fibrotic treatment. The primary endpoint of the study is safety and tolerability. But having said that, we do have secondary end points, one of which is an efficacy end point. And I think this is another really elegant part of this early phase study is that we will be collecting efficacy data on FVC. And just to explain a little bit more about the inclusion and the exclusion criteria. So these are absolutely standard for IPF studies. But what's nice about this study, as Toby has already highlighted, is the central reading. So all each patient scans will be reviewed at the Royal Brompton, which is a nationally recognized expert center for idiopathic pulmonary fibrosis. The exclusions are standard exclusion criteria that we would have in any IPF study. And as I said before, really an important part for the patients is that when they commit to clinical trials, they do see that they will be reviewed. And if they decide that it's not for them that they can withdraw at 12 weeks or don't have to, but they have that option. And then all patients will be seen, of course, at the end of treatment. So a little bit about our primary efficacy endpoint, and I can't emphasize enough, but if we don't meet the same point, that doesn't mean the trial has failed. This is a secondary endpoint, but it will just help us plan the future Phase III study. It helps us roll the dice in our favor and make sure that we have the right numbers of patients. And what we see on this graph is the predicted decline in FCC in a population of IPF patients over 6 months is a loss of 120 ml. Nintedanib, the orange line, is thought to reduce that by 50%, so a loss on average of 60 ml. And what we've calculated is that if C21 has a more dramatic effect than nintedanib or a similar effect, then we will be -- we will be able to detect this at an 80% power with our 6-month study of 60 patients. So I'm confident that if there is an efficacy effect, we will pick us up. So what do I like about this study? Well, I like the fact that it's a clean study. We haven't really spoken about this before, but the patients we will select the patients that are not on antifibrotics. So they will all be treatment naive. We've talked about the importance of in-clinic biometry and confirmatory HRCT central overread. Another feature is that all patients will have COVID-19 vaccination. This is good for patient safety, but also the integrity of the studies. We know that COVID can worsen IPFs. Very, very attractive for both me and the patients are that all patients will have active drugs. There is no placebo arm. That the control arm will be provided by historic controls, which we have seen behave very similarly across widespread IPF populations. And that wonderful opportunity for the patients to not commit themselves too much, but be able to review their progress at 12 and 24 weeks. The patients, of course, are very reassured by that. They also like the fact it's a 9-month study. It's long enough for them to experience benefits, but also not too long that they're buying into something too onerous. And of course, actually as a study, it's really very un-onerous. This oral administration of the medication at home rather than coming to coming to hospital for the whole day to have an intravenous infusion, the patient just takes some 30 seconds to take a tablet in the morning. And it's light touch. There are very few assessments and the assessments are ones that are warranted. So I hope I persuaded you that the AIR study is set to really address the increasing burden and unmet need in IPF. It's a very recruitable study. I can honestly say that every patient I have mentioned the study to is enthusiastic and wants to take part. But it's also a stringent study with the HRCT overread and will really give us the data that we need to go forward in planning the pivotal regulatory Phase III study in IPF. So thank you very much.

Thank you, Joe, for this elegant description of our trial. I'll just show you, in the end, now a metro map. And we started off at the central station with C21 then. But it's also -- we're not only focusing on the fibrotic disease and the fibrosis per se, we are trying to build a strong presence in IPF by adding programs, both on the cough situation, which is really a troublesome problem for patients and also addressing the anxiety and depression through the digital cognitive therapy approach that we are now embarking on. So we want to have a strong presence there. And in parallel, we are actually now unraveling new biology. We can see a very common theme, as Rohit alluded to, between cardiovascular and fibrosis diseases in the lung, in the kidney, based on all the preclinical available data that we have with C21. So all in all, we decided to put a lot of emphasis on bringing new compounds forward, and we will come back with more detailed plans for that, but we have now several compounds in late-stage toxicology, just the step before clinical testing. So we have a lot of hope that we can be able to introduce new -- a new pipeline chart with new compounds as well, emanating from this new biology. And here, we're not only first-in-class, pretty alone in class, which I also think is a huge advantage for us. And then, of course, we have the COVID-19 that came from nowhere that we embarked on with a very positive data and where we now are looking into the opportunity to actually have this for an emergency use authorization, if there still is an emergency through the Phase III trial that we are conducting right now. So with that, I will stop and hand back to the organizing team and the Q&A session. Thank you.

[Operator Instructions] I'll now turn the call over to Hans Jeppsson, Chief Financial Officer of Vicore to moderate the Q&A session.

Thanks. So great. If I could start off, we've got a handful of questions that already have come through. So let's start with the first one, maybe directed to Rohit. How does the AIR trial differ from other studies in IPF?

Thanks, Hans. So I suppose you could think of it in 4 ways. 2 of those would probably help recruitment. So first of all, there is no placebo, okay? So there's no placebo lottery. Instead, we've applied a sort of a carefully applied historical control arm, okay? The second aspect is that we are studying C21 in monotherapy, so not on top of standard of care, remembering this is a Phase II proof-of-concept study. So we want a clear readout, no-go read out at the end. We don't want to be unpicking what's due to standard of care and what's due to C21. The third is, as Joe explained that we have very carefully a HRCT stringent criteria. So the historic scans for these patients are uploaded and they're sent to a reader in Brompton and make sure that they obviously have the IPF diagnosis. And the 4 is that we're trying to sort of, I suppose, mirror a more real-world sort of scenario, where the sort of 3 months where the physician and the patients sit down and make a decision and hopefully, they continue with the trial. But if not, then obviously, there's an opportunity to switch to antifibrotics. And the protocol also allows that if, obviously, if they withdraw before 12 weeks, then we can add more patients to make sure that we have an evaluable cohort at 6 months. So sort of together with all of these parameters, we're trying to sort of create a sort of smart, early phase design that then gives us a validated readout, which is obviously straight forward to interpret in the end. Hope I've answered that question, Hans.

Great. Thanks, Rohit. Maybe next one for Toby. Is the linear decline FVC of 240 milliliters a reliable control for this study?

So I think as I alluded to in my talk, the placebo arms in the various trials have behaved very consistently. I -- clearly, that there is a standard deviation on that. But overall, the cohorts have fallen within that. 220 to 240 ml decline. So I think if we see a treatment effect, then one can reliably compare that to historic cohorts. And it's worth saying, which I didn't perhaps say in my talk is that one of the other advantages of FVC and IPF is that it behaves very consistently across all levels of disease severity, but patients with well-preserved lung function lose FVC at the same annualized rate as patients with more advanced disease. Obviously, I'm talking at the population level rather than at the individual patient level. But it is a strength that the decline is linear across the disease because it allows interpretation even in patient groups with better-preserved lung function.

Thanks, Toby. Another question for you. What is the unmet medical need in IPF?

And I think the unmet medical need is several-fold. Despite having antifibrotic therapies, I'm still seeing my patients die of respiratory failure. So I need more efficacious treatments, whether that's treatments that stand-alone and are highly efficacious or whether it's treatments to add on top of existing therapy, I need to be able to offer more to my patients. Rohit mentioned pulmonary hypertension, and that is an end -- it's a complication that we see in patients with IPF that adds to their burden of symptoms. Again, the opportunity to treat that is important. A. And as I alluded to in my talk, the existing treatments do create tolerability issues for patients. So real-world data returns suggest that somewhere between 25% to 35% of patients will discontinue drug within the first year, and that's mainly due to side effects. Of the remainder of patients who manage to continue on treatments, a proportion of them will do so, but having to deal with usually gastrointestinal side effects from treatment. So we need better tolerated, more effective therapies, ultimately.

Great. Thanks, Toby. Maybe next one for Carl-Johan could best address this one. Can you comment in more depth on the market opportunity in IPF?

Yes. Sure. I mean, today, the sales of IPF drugs amounts to $3.6 billion. And we know that this is not the full market value, as Toby have also clearly shown that not all patients get the treatment. And of those who get the treatment there is a certain number that will offset out, even though it's a deadly disease. So it's certainly a huge market opportunity if we have a drug that can be as good as standard of care without the side effects or even if better than standard of care without the side effects. And I think side effects is an important part of that as well because that will maybe also allow a combination for -- to achieve an even better efficacy if we don't get all the way. So I think there is still a huge medical need. There's still a huge market opportunity for novel IPF drugs with a favorable profile.

Thanks, Carl-Johan. Next one for Toby. Do you have any comments on the 2 earlier IPF drug failures in 2021?

It's difficult to say anything with great clarity because we haven't seen publicly all of the results and all of the reasons behind the discontinuation of trials. I think some of it speaks to the challenge of running clinical trials on background standard of care. I think some of it speaks to the Challenge of running clinical trials during COVID. And I think we are going to have to dissect the data from those studies so that we can learn from it and ensure that we take those lessons forward and don't see failures for similar reasons. And it's interesting that the challenges seem to have been highlighted by the data safety monitoring committees. And I think it does raise questions about the sort of interface between background therapy and the COVID pandemic that will provide learnings for us going forward.

Thanks, Toby. Next one maybe for Rohit. Why did Vicore chose to conduct AIR in India, Russia, Ukraine and the U.K.?

Thanks. Yes, sure, Hans. So with our trial design, we were keen to sort of target a, I suppose, a homogeneous population. So as I mentioned, we wanted to have a clear readout in terms of go/no-go indications at the end. And that's why we targeted a treatment-naive sort of cohort. Now obviously, these patients are tricky to find, and they're more prevalent in these countries, India, Russia, Ukraine and the UK vis-a-vis the US. So that was one of the key reasons there. And also, we've got pre-existing relationships with the centers that we've chosen. They've done the IPF studies in the past, and they've had record recruitment and so forth. So that's another reason as well.

Can I just quickly add on top of that. I would say that the central reading provides sort of insurance that there is consistency of recruitment across territories. I think IPF in contrast to many other diseases does really allow for central assessment of diagnosis in an diseases like asthma or inflammatory bowel disease, there really is a struggle recruiting from some countries because you can't verify the diagnosis, you're heavily dependent on local investigators and one always worries about motivations for recruitment. But in IPF, we can use the CT scan as a very definable reference point to ensure that recruitment is consistent across countries. And I think that really opens up any country to be considered as a trial recruitment place in contrast to some other diseases where one might worry more about the choice of countries.

Great. Thanks, both Toby and Rohit. We're getting some similar questions from folks. I'll try to combine them and try to post them here appropriately. Next up would be maybe for Rohit. Are there any interim analysis planned, given that it is an open-label study?

Sure. So the short answer is that there are no sort of preplanned interim analyses. But obviously, we can -- at a time point, we can decide to do one if we want to. As I mentioned in my talk that the data monitoring committee have had 2 meetings so far. They've obviously analyzed the data for those 2 and they've reported no safety signals. And so they continue as we're doing. So that's obviously good news there.

Perfect. Great. Other one for you Rohit. How does the mechanism of action of C21 compare to that of other drugs in development?

Yes. Okay. So comparing medicines is always fraught with challenges, but I'll try and sort of give it a go. And Toby, Joe, feel free to chime in. But I mean, I suppose IPF is an incredibly complex disease. Obviously, as Toby mentioned, in terms of predisposing, precipitating, perpetuating factors. And a medicine that has a, I suppose, a pleiotropic action versus a highly specific one could have greater chances, particularly if it's working upstream and you saw my slide on the alveolar epithelial type 2 cell where the angiotensin 2 receptor target is highly expressed. Now C21, our medicine, it's novel, it's first-in-class, and it's a completely different mode of action to the others in development. It has that dual impact on the fibrosis. And we've done that precision-cut lung slices, which suggests that we've got tissue-specific target engagement. And then the palmer hypertension as well, the Sugen data, the remodeling and the clinical study, the single dose one that we've done in terms of vasodilation. So -- and also, not forgetting, the good safety profile that we've had, we've just done a COVID study in vulnerable patients. There wasn't any signals there because some medicines recently have had some setbacks on the safety side of things. But so far, so good. So good safety profile and tolerability as well.

Thanks, Rohit. Another question for you on recruitment. How has COVID-19 affected recruitment in the AIR trial? Can you provide an update on recruitment?

Yes. So as Toby mentioned, I suppose, across the board, respiratory diseases, COVID-19 has had a profound effect, really, I suppose, up -- at least up until the widespread sort of vaccination rollout. And I suppose in respiratory disease, the possibility that a patient might succumb to a poorly understood virus is obviously a risk to that patient, risk to others and risk the integrity of the study itself. And in the AIR study, we were quick to react to this. So we actually had a protocol amendment that Joe mentioned that, is that we now mandate that patients are vaccinated on COVID-19. So that's certainly helped and obviously helps to protect the integrity of the data as well. And the other thing is, which Joe mentioned is that there's no placebo lottery. So that really we've seen is a real sort of benefit for patients. And obviously, that can help them boost recruitment as well. But as I mentioned, we're on track to get the data by quarter 4 2022. And we're obviously increasing sites in the UK as well. So that's another thing we're doing.

Perfect. Thanks a lot, Rohit. Maybe next one for Carl-Johan. What is your strategy if the Phase II AIR trial is successful? How will that position your product in the market?

I think if it is a successful trial with data that clearly shows the benefit over standard of care with a good side effect profile, I think we have the opportunity to both go head-to-head for superiority or to position ourselves also as an add-on therapy. And I think in the real world, if that's the situation, people would want to have a drug with lesser side effects and better efficacy, of course. But I also can see that if efficacy is not 100%, certainly, most patients would like to try to combine that with other drugs, of course. So depending on data, I think that we'll decide how the Phase III trial will look. And there may well be more than 1 Phase III trial as well if we see the opportunity of both a standalone therapy and a add-on therapy.

Maybe next one to Joe Porter? How could C21 change the treatment paradigm?

Well, that's if successful and if it's shown to have an impact in a Phase III study, which I hope it will, then obviously, it just increases the choices for our patients. So instead of offering them a drug with gastrointestinal side effects or a drug with skin side effects, we will have another medication that we can offer them. And obviously, if there's add-on therapy as well, then we're looking at a whole change in the way we treat our patients with additional therapies with combination therapies.

Thanks, Joe. Maybe next one for Rohit. Could you take us through the feedback you received from patients, clinicians and regulators on the trial design?

Yes, sure. I mean, we've had sort of seamless collaboration from all stakeholders in terms of sort of designing the study. I think Joe and Toby probably recommend me -- remember me numerous times knocking on their doors trying to seek input. But I suppose from a patient perspective, we've again sought input from the charities and removed the placebo lottery, everyone gets active treatment and also the safety profile doesn't look -- it's different to what some of the other experimental medicines and obviously, we don't get the GI intolerance. Clinician-wise, more of the real-world sort of type scenario, which helps, and obviously, patients can switch. Ideally, they continue, but the switch, but we can add patients if we need to. Regulatory, we've obviously -- we have the regulatory endpoint there approved and favored one, the FVC. And we're not using some obscure sort of unvalidated biomarkers. This is what the regulators want, the FVC. And all together, with this design, it sort of allows us to recruit fast and obviously, then have a validated readout at the end.

Thanks, Rohit. I think time is running out. Maybe we can take one last question, I think, maybe for Toby. Would you use this medicine if it achieved its goals and was able to confirm findings in pivotal trials?

The short answer is yes. The slightly longer answer, we've already discussed the unmet needs. And I think it's worth if we just look at the IPF pipeline very briefly, the 2 drugs that are still in Phase III trials are both intravenous. C21 is an oral treatment. I think from a simplicity of management perspective, having a once-a-day oral therapy is really going to be of great benefit to patients. And hopefully, one without GI side effects will give us the opportunity either to use it as first-line stand-alone therapy or as combination therapy where one of the existing drugs, hopefully, to gain even better efficacy. So I think, yes, we desperately need new treatments and C21 has all the characteristics of a great therapy to have in clinic if we can demonstrate efficacy.

Thanks, Toby. Last, from a Q&A perspective on the inbound questions. So I'll maybe turn back to Carl-Johan for some concluding remarks.

Thank you, Hans. And I just would like to thank you all for tuning in and listening to this and taking part of this webinar. And I would thank to Toby and Joe for your contribution. And of course, great thanks to investigators and patients that participate and make this possible in the trial. So thank you, everyone.