IFRX - InflaRx: Small German Company Targeting A Rare Indication

2023-09-06 17:31:58 ET

Summary

• InflaRx is a developer of complement mediated therapies for inflammatory diseases.
• Their lead asset, vilobelimab, is a C5a inhibitor targeting Pyoderma Gangraenosum in a phase 3 trial.
• The company has a cash runway of 7-8 quarters and raised $40mn in a public offering in April.

InflaRx ( IFRX ) is a developer of complement mediated therapies for inflammatory diseases. The complement system is described by the company as follows:

The complement system, also known as complement cascade, is a part of the innate immune system that enhances (complements) the ability of antibodies and phagocytic cells to clear microbes and damaged cells from an organism, promote inflammation to attract additional phagocytes and attack the pathogen's cell membrane through activation of the cell-killing membrane attack complex (MAC).

C5a is a key mediator of immune response to foreign bodies, and a molecule that is responsible for acute and chronic inflammation. IFRX has a proprietary technology that enables “ generation of highly selective and potent blocking monoclonal antibodies (including vilobelimab and IFX002)” against C5a.

Here’s the pipeline:

Gohibic (vilobelimab) is a covid-19 medicine with a US EUA granted in April, however, given the easing of the covid situation, we should probably ignore this molecule for evaluating IFRX. I will just note that in April, the FDA approved this drug for serious covid patients despite it missing the primary endpoint in a phase 3 trial. It is branded as Gohibic.

Thus, lead asset is vilobelimab, a C5a inhibitor targeting Pyoderma Gangraenosum ( PG ) in a phase 3 trial after positive data from an open label phase 2a trial. It is almost the same mechanism as AstraZeneca’s blockbuster Soliris, except soliris targets both the C5a and C5b, while vilobelimab stays away from C5b, which has an essential function in the innate immune system.

Pyoderma gangraenosum is a rare and serious skin condition caused by inflammation, and characterized by the development of painful and rapidly progressing skin ulcers. These ulcers typically start as small pustules or blisters that quickly break down, forming large, painful, and necrotic areas of skin. The condition can occur anywhere on the body but is often found on the legs. It is generally treated using immunosuppressant medications. There are no approved drugs. There are one in 50,000 patients in the US and EU, thus, there are approximately 14000 to 16000 patients in these geographies.

Now, querying the TickerBay software, we get the efficacy data for the molecule-indication combo :

In the Phase IIa open-label study with vilobelimab in Pyoderma Gangraenosum (PG), the highest dose cohort (2400mg biweekly) showed positive efficacy results. In this cohort, all seven patients achieved clinical remission with a Physician Global Assessment ( PG A) score of ?1, indicating closure of the target ulcer. The study evaluated the responder rate defined as a PGA score of ?3 of the target ulcer at various timepoints and time to complete closure (remission) of the target ulcer. The final post-treatment observational data for this cohort will be available in the first half of 2022.

This is from the third cohort data. Another interim analysis from 2021 showed the following data:

Out of the 10 patients evaluable for efficacy at day 99, four patients met the response criteria, with three of them achieving complete closure of the target ulcer. The three patients who showed clinical response with a Physician Global Assessment (PG'A) score of ? 3 and complete target ulcer closure had elevated C5a levels at baseline. These results indicate a positive response to treatment with vilobelimab in Pyoderma Gangraenosum (PG).

The complete data from the Corporate presentation is here:

Out of 17 evaluable patients at end of treatment visit or day of last drug administration ? Clinical Remission (PGA ? 1): 9 patients (53%) ? Clinical Response (PGA ? 3): 1 additional patient (6%) ? Slight Improvement (PGA = 4): 7 patients (41%) • High Dose Group shows highest rate of target ulcer closure and clinical remission (85.7%)

The company now has a phase 3 trial ongoing.

The same molecule has another program targeting cutaneous squamous cell carcinoma. A phase II trial is ongoing with a combination arm with pembrolizumab in the highest dose level.

Other programs are in early stages.

Earlier, they had another lead program targeting Hidradenitis suppurativa, where they ran a phase 3 trial whose primary endpoint, they said, was arrived at after a Type A meeting with the FDA. However, after the trial was completed with positive results, the FDA, the company said, requested a change in the trial endpoint. The company has put this program on hold.

Financials

IFRX has a market cap of $244mn and a cash balance of €115.2 mn. Research and development expenses for the three months ended June 30 were €10.9 million. General and administrative expenses were €3.5 million. At that rate, the company has a cash runway of 7-8 quarters.

In April, right after the FDA granted them an EUA for covid, the company raised $40mn in a public offering.

IFRX is a German company. Nearly 60% of the stock is held by the retail public. Key institutional holders include Suvretta Capital, Tang Capital and 683 Capital. Being a foreign issuer, no insider transaction data is available.

Risks

Barring the EUA in covid (which I will ignore anyway because covid-related pharma sales are plunging these days, and this is not a full approval), nothing much stands out here. Their PG data is great, and their selective complement mediation is promising. Cash is, however, low, and I do not expect a major revenue addition from the EUA approved medicine.

Bottomline

The above section sums up my thinking. The Pyoderma gangraenosum indication could be promising only if the company is able to develop this into a proper platform. That is going to be a long wait, if it happens. I will stick to the sidelines for the time being.

For further details see: