Addex Therapeutics Ltd Price & Performance (ADXN)

I would like to thank you all for attending our twenty twenty four full year financial results conference call. I'm here with Mikhail Kalinichev, our head of translational science who will provide an update on our r and d programs. I draw your attention to the press release and the financial statements issued earlier today, which are available on our website. I also draw your attention to our disclaimers. We will be making certain forward looking statements that are based on the knowledge we have today. I will start this conference call by giving a quick overview of our activities and achievements, before reviewing our pipeline. I will then hand over to Misha who will review in more detail our mGluR five negative allosteric modulator program for brain injury recovery. And our GABA B positive allosteric modulator preclinical program for cough. I will then review our twenty twenty four full year financial results, Following that, we will open the call for Q and A. In 2024, we launched Neurosterics with a 65,000,000 US dollar Series A financing led by Percepta Advisors. And secured financing for our platform. Preclinical portfolio. As part of this transaction, we received 5,000,000 Swiss francs in cash and a 20% equity interest in Eurosteryx.

We've made excellent progress in our GABA B PAM program. The completion of the R and D phase delivering multiple drug candidates. Our partner Indivior has selected a compound for development in substance use disorders and has started IND enabling studies. We expect to be able to announce results from these studies soon. Under the terms of the agreement, Addex is eligible for payment of up to 330,000,000 US dollars on successful achievement of prespecified regulatory clinical and commercial milestones as well as tiered royalties on the level of net sales from high single digits. Up to low double digit. Also, under the terms of the agreement, we have the right to select compounds for development in a predefined list of reserved indications. We have selected a compound to advance our own independent GABA B PAM program the treatment of chronic cough. We have substantially completed the preclinical profiling of our compound for chronic cough and are currently working to secure funding to advance this program into the IND enabling studies. Misha will be sharing some of this data with you later in our presentation. We've repositioned diprogluarant, our m two r negative valsatate modulator for brain injury recovery and are currently completing negotiations to act intellectual property covering the use of NDRA five inhibitors in this interesting therapeutic indication.

Micha will also talk more about this exciting program later in the presentation. Following the decision last year by our partner, John Johnson, to terminate development of ADX seven one one four nine, have regained the rights to this phase two asset with a high value dataset and significant materials. We have completed the year with CHF 3,300,000.0 of cash, which provides us with cash runway through mid-twenty twenty six. I'd like to highlight that the cash burn has been significantly reduced following the NeurosDeric spinout transaction. However, current cash does not fund the progression of our unpartnered program into the clinic. Onto the pipeline. We continue to believe in Dipigrant and executing our plans to reposition the development. For brain injury recovery as mentioned. Our partner, Indivior, has selected a GABA B PAM drug candidate for developing substance use disorders and started IND enabling studies. We're advancing an independent GABA BPAM program for chronic cough and expect to start IND enabling studies this year subject to securing financing. And Neurosterics has made excellent progress in advancing its pipeline, including starting IND enabling studies with its m four PAM program. Now I will hand over to Misha will give you some more details about our exciting portfolio.

Thanks, Tim. Hello, everyone. I will start by speaking about dipragilorant and our plans for development in brain injury recovery. Following termination of the development of dupamturan in PD Lid, we embarked on a detailed evaluation of a number of potential indications. Of interest for future development We have completed this exercise and have identified brain injury recovery as an interesting indication for the future development. We believe the differentiated profile of tipamura may it particularly suitable for enhancing the impact of rehabilitation in traumatic brain injury, and stroke patients. Is a large unmet medical need in post stroke recovery and rehabilitation. Stroke is among leading causes of chronic, often lifelong disability. As it leads to motor sensory cognitive impairment, and multiple comorbidities. There are over one hundred million stroke survivors worldwide, and the number is growing at the annual rate of twelve million. A variety of rehabilitation therapies are used with post stroke patients, but the recovery is slow and often inadequate. There is an urgent need for pharmacological agents that can facilitate the recovery stimulated by rehabilitation therapy. MGLR five receptor is a suitable target to address post stroke recovery. As it is densely expressed in the brain, involved in neuroplasticity and modulates excitatory inhibitory equilibrium.

In fact, activation of MOR five has been observed in a range of neurological including stroke, where it plays a role in maladaptive rewiring of the brain following stroke. Inhibition of MOR five, on the other hand, can facilitate adaptive rewiring of the brain, promoting neuroplasticity and creating of new functional pathways moving the neural network towards a pre lesion state. Exciting new evidence recently published in the journal Brain suggests that the negative allosteric modulator of MQR five MTAP administered daily in red following stroke results in a sustained and growing improvement in sensory motor function, in comparison to vehicle treatment. Similar improvement in sensory motor function was observed in animals treated with Auer and MWR5NAB dipragula. MRI imaging of the resting state functional connectivity in post stroke rodents shows that daily administration of MTEP also stimulates intra and inter hemispheric connectivity in the brain disrupted by stroke. It is important to note that improvement in brain connectivity after stroke is known to correlate with functional recovery and is observed across species. The pravilorant is ideally suited to be used in tandem with rehabilitation therapies in post stroke patients, as it has a fast onset of action and short half life.

It has shown good tolerability in healthy subjects. And in Parkinsonian patients, showing only mild to moderate CNS related adverse effects. We have a drug product ready, a strong patent position, and believe dipraglione can become a first in class drug to facilitate post stroke recovery. We can also speculate that the progrunt mediated adaptive rewiring and facilitation of recovery following brain damage would also be seen in traumatic brain injury patients. Let me now switch to our GABA B positive allosteric modulator program, which is partnered with Indivior. The aim of this collaboration is to deliver a better baclofen for substance use disorders. As a reminder, GABA B receptor activation has been clinically validated in a number of disease areas using baclofen. And gamma b orthostatic agonist. Baclofen is an FDA approved drug for treatment of spasticity, and is widely used off label to treat numerous diseases, including substance use disorders and others.

However, baclofen has a short half life, and comes with significant side effects, hampering its wider use. Thus, there is a strong need for a better buccal We believe this can be achieved with positive allosteric modulator approach and their differentiated pharmacology. Having the efficacy of baclofen but longer half life and improved side effect profile. Our partner Indivior has selected agla vipam drug candidate development in substance use disorders and started IND enabling studies. As part of our agreement with Indivior, Addex has exercised its right to select a compound to advance its own independent company program. For the treatment of chronic cough. I will now present this exciting opportunity. There is a strong rationale for developing gabapam's for chronic cough. Chronic cough is a persistent cough that lasts for more than eight weeks and can be caused by a variety of factors, including respiratory infections, asthma, allergies, and acid reflux. But also, possibly by an overactive cough. Reflex. There is a large unmet medical need in novel anti acoustic drugs as current standards of care are ineffective in thirty percent of patients or only moderately effective in up to sixty percent of patients. In addition, the current treatment carry risks of serious side effects.

On the next slide, we show that GABA b PABSS are likely to have a superior tolerability profile in comparison to the current standard of care. And show no taste related side effects as seen with the newly approved p two x three inhibitor, cefapixant. Supports for using guava vPAB in treatment of chronic cough comes from the clinical evidence that baclofen is used off label in cough patients and from the anatomical evidence that GABA B receptors are strongly expressed in airways and in the neural pathway regulating cough. Therefore, we believe that gabapam could offer superior efficacy in cough patients. The pre ID activities, including in vivo proof of concept, non GLP tox, and CMC have been completed. And our clinical candidate has shown favorable efficacy tolerability, and developability profiles. Our clinical candidate has demonstrated a consistent minimum effective dose of one mg per kg and ED fifty of six per kg in co frequency. No signs of tolerance were seen after subchromic dosing and more than 30 fold safety margin was demonstrated based on tolerability biomarkers. The IND enabling studies are planned to start this year. The next set of slides describes the vivo proof of concept studies.

In models of COF. In a model of citric acid induced cough in guinea pigs, acutely administered compound a, delivered a robust anti use of activity profile, reducing the cough number and increasing the latency to first cough. The anti GC profile of Bakknoff in the same model was more modest. As COF latency remained largely unchanged. In the same experiment, compound a was better tolerated. Than buprenorphine as there were no marked changes in respiratory rate rate body temperature, and plasma concentration of gross hormones. At up to sixty mgs per kg. In contrast, bucclofen suppressed respiratory rate reduced body temperature by near two degrees Celsius, and increase gross hormone concentration in plasma starting three mgs per kg dose. Thus, we believe we achieved our goal. To discover a better baclofen for cough. In a model of citric acid induced coughing guinea pigs, subchronic administered compound A showed signs of improved efficacy and potency and no signs of tolerance in comparison to an acute treatment. As expected, science related to safety and tolerability of compound a remained largely unchanged. On the subchronic versus acute treatment regimens. In the model of ATP potentiated citric acid COF in guinea pigs, in a head to head comparison experiment acutely advanced on compound a, and the p two x three inhibitor had similar efficacy and tolerability profiles.

In summary, we have selected a clinical candidate for chronic cough, with a robust reproducible anti use of efficacy of one mg per kg and good PKPD. The compound showed a favorable developability profile in non GLP tox studies performed in rats, dogs, and nonhuman primates. We are on track to start start IND enabling studies this year.

This concludes our prepared remarks on the progress of our RNA program. Now I hand it back to Tim.

Thanks, Misha. Now before I move on to the financials, I would like spend a few moments to speak about the Neurosterics transaction. Due to the excellent progress made by our R and D team in advancing our unpartnered preclinical portfolio, our M4 PAM, mDRA7 NAM, and m d r two negative allosteric modulator programs reached a stage of development where they needed significant amounts of financing to progress into the clinic. Unfortunately, given the low market capitalization of Addex, raising the amount of capital needed would have been extremely challenging and highly dilutive to our shareholders. So we decided to spin out these programs and our platform into a new private company and raise the necessary capital directly into the new private company. Believe this is an excellent transaction for Addex shareholders as it was has secured 5,000,000 Swiss francs for Addex and removed the financing overhang on the Addex stock.

We've retained a 20% interest in Eurosteryx so we can benefit from the upside from advancing the programs into the clinic, which is now secured by the $65,000,000 capital from a high quality investor syndicate led by sector advisers. As part of the transaction, have divested our Alacerate modular technology platform, including the majority of our staff. Have we have entered into a service agreement with Neurosteric to ensure we can access skills needed to execute on our business strategy. Now for a review of the 2024 financials. Following the Neurosteric transaction, we were required under IFRS to identify continuing operations related to our retained business and discontinued operations related to the divested business sold to Neurotherics. All income and expense items related the discontinuing operations have been reclassed under a specific line of the comprehensive loss called net profit or loss from discontinued operations. Starting with the income statement. Which related to continuing operations, We recognized 400,000 of income in 2024 compared to 1,600,000.0 in 2023. The decrease is primarily due to the completion of the funded research phase of our collaboration with Indivior in June of twenty twenty four. Continuing r and d expenses of 900,000.0 remain primarily relate to [indiscernible] and decreased by 200,000.0 in 2024 compared to 2023, mainly due to completion of the research phase.

Of the individual collaboration. Continuing r and d g sorry. Continuing g and a expenses of 2,300,000.0 primarily relate to corporate development activities, decreased by 400,000.0 Swiss francs in 2024 compared to 2023, primarily due to the reduced d and o costs. The finance result lot result loss in '23 has turned to a small gain primarily due to a significant reduction in forex exposure as we are now holding most of our cash in Swiss francs.

The share of the net loss of associates of 2,200,000.0 relates to the 20% equity interest received as part of the consideration for the divestment of the part of our business to Neurosterics. Which is being accounted for using the equity method under IFRS 12. Under IFRS, we are required to recognize our share of their results. Now for the balance sheet. Our assets are primarily held in cash, and we completed 2024 with 3,300,000.0 Swiss francs of cash held in Swiss francs. In US dollars. Other current assets amounts to 200,000.0 primarily rate prepaid r and d costs. Our noncurrent assets of 7,100,000.0 as of 12/31/2024 primarily relate to the 20% equity interest in Eurostates Group recorded on the balance sheet under the equity method of accounting for associates. Current liabilities of 800,000.0. As of 12/31/2024. [indiscernible] by 2,100,000.0 compared to December 3123 and primarily relate to r and d related accruals and payables. Noncurrent liabilities 200,000.0, as of 12/31/2024 decreased 5,400,000.0 compared to 12/31/2023. Primarily due to the reduction in retirement benefit obligations following the of staff to Neurosterix. Now the cash flow statement, At the end of twenty twenty four, the cash balance amounted to 3,300,000.0 and decreased by 600,000.0 compared to the beginning of the year.

The 5,000,000 gross proceeds received as part of the consideration received from the divestment or part of our business was offset by the operating cost of continuing activities. Now to summarize, we have made excellent progress in our GABA v PAM program with our partner Indivior. Selecting a compound for development and substance use disorders, and starting IND enabling studies. In the in the second half of twenty twenty four. Neuroesthetics has made excellent progress with their lead m four PAM probe drug candidate starting IND enabling studies in q three of twenty twenty four. Diproglom is ready to restart clinical development brain injury recovery. Our independent GABA BPAM program has demonstrated excellent preclinical efficacy and tolerability with IND enabling studies ready to start. We're validating partnerships with industry, sport of investors, strong balance sheet, which puts us on a solid position to deliver on our strategic objectives. This concludes the presentation, and we will now open the call for question.

Thank you, dear participants. As a reminder, if you wish to ask a question over the phone, please press 11 on your telephone keypad. And wait for your name to be announced. To withdraw a question, please press 11 again. Alternatively, you can submit your questions via the webcast. Please standby while compile the clinical study. It will take a few moments. And now we're going to take our first question. And it comes from the line of Raghuram Selvaraju from H. C. Wainwright and Co. Your line is open. Please ask your question. Excuse me, Rakran. Can you hear us? Your line is open for questions. Alternatively, you can submit your questions via the webcast. And we have on the line Raghuram Selvaraju from AC Wainwright and Co. Your line is open. Please ask your question. My apologies, Rakuram. We cannot hear you. Dear speakers, we'll just give a moment. For our participants submit questions. And now we have another analyst. Just give us a moment. And the question comes from the line of Peter Aelig from Aiken South. Your line is open. Please ask your question.

I would like to know about neurosterics. I think that's a new company.

Do they have other projects? Other than what you now sold to them? Thank you for an answer. Did you hear me?

Yes. Thank you very much, for your question. And yeah, so neurosterics was actually, founded by Addex as a spinout company So we packaged up our platform including facilities, people, and, we put it into a, a new Swiss company, which we then sold to a a US LLC. Which had been capitalized with with cash and a capital commitment of 65,000,000 from a syndicate of US investors led by perceptual advisers. And the transaction involved buying the Swiss subsidiary for a mix of cash and equity. So Addex received a 20% interest in the US LLC, plus 5,000,000 cash, and the rest of the $60,000,000 is being deployed into the portfolio that was contributed into the Neurosteric Swiss sub And there are four programs. The lead program is a muscarinic m four PAM, and then there is an m Glu r seven negative modulator program and also an m g l r two negative allosteric modulator program. And then another program which is undisclosed at the very early stages of discovery And they're all focused on neuropsychiatry, schizophrenia, mood disorders, and cognition. And and an undisclosed CNS indication. Does that answer your question?

It does. But I guess that means that you have a lot of, additional work just to sort of control the activities of neurosterrics and of your 20% investment there. Is that correct?

Well, NeuroStarix has has its own team. And most of in fact, neurosterics has most of the old Addex team, plus new employees that have been recruited. And you know, my I my you know, I am currently the CEO of Neurosterics. And the CEO of Addex. And, Mike, and my role as CEO of Addex is under a service agreement between Neurosterics and Addex.

Okay. That explains it. Thank you very much, Tim. You're welcome. Thanks, Peter. Thank you. Now we'll proceed with other question, and it comes from the line of Raghuram Selvaraju from H. C. Wainwright and Co. Your line is open. Please ask your Thanks for taking my question. I wanted to ask if it would be possible for you to enumerate how you are seeing the strategic environment and, essentially evolving for diproglurant particularly within the context of neurorehabilitation. And if you could also comment on the potential ability to depaglerant in neurorehabilitation contexts not involving post stroke recovery?

Thank you.

Nisha, would you like to take this question?

Yes. Absolutely. We are [indiscernible] our clinical asset that has shown very good tolerability both in health subjects and in patients with Parkinson's disease. It gives us an opportunity to perform a number of small clinical pharmacology studies aiming to assess improvement and modulation of plasticity. In human subjects. We'll probably start with healthy volunteers. And look at multiple sites of potential plasticity from motor cortex to sensory to midbrain to spinal cord. Also evaluate what type of treatment conditions is suitable and ideal for modulation, and then move forward with similar study but performed in post stroke patients. So this will be as we see two clinical pharmacology studies. With specific questions very much focused on neuroplasticity. And we believe these studies will first confirm the modulation of plasticity in humans, particular in postural patients, and will help us in designing proper phase 2a study on rehabilitation approaches. So that's a very overall summary of our clinical strategy.

And then secondly, if I may, I was wondering if you could comment on the recent developments in the neuropsych field perhaps most notably the failure of the Phase III trial of Cobenci as adjunctive treatment in schizophrenia and what implications this may have for future directions you pursue with one or more of the neurosterics lead assets.

Thank you.

Yeah, yes, we saw the news, of course, and we believe that it has minimal, if any, impact on our strategy. We are pursuing the strategy of monotherapy. We have we we believe in the target. We get we believe in the relevance of muscarinic m four for psychosis. So it's not going to alter our plans at all.

And then lastly, Tim, I don't know if you are in a position to comment on this at this time. But I was wondering if you could offer us some idea of what, if anything, you plan to do with the compound that was returned to Addex from J and J. If you see any future development path for that asset. Thank you.

Yes. We are mean, we're already discussing with a number of, interested parties. We are we are you know, we're doing our own evaluation. As you can imagine, you know, this is a twenty year development. In the hands of J and J. It's a very, very high quality compound. With, you know, a lot of data a lot of material, about 280 kilograms of API, has been transferred to us. And this is significant material for us to, you know, to play with. So we're definitely looking to know, enter a number of collaborations to explore areas that could be pursued with the with the compound.

Thank you very much. Thank you. Dear participants, as a reminder, if you wish to ask a question, please press The speakers will just give a moment to allow an analyst to submit any questions. Thank you, ladies and gentlemen. This brings the main part our conference to close and I would like to hand back to Tim Dyer for closing remarks.

Thank you, everyone, for attending the twenty twenty four full year results conference call. And I wish you all a very nice day, and we look forward to speaking to you again soon.

This concludes today's conference call. Thank you for participating. You may now disconnect. Have a nice day.