Moleculin Biotech
Business Highlights
Moleculin Biotech (MBRX) is a clinical stage pharmaceutical company organized as a Delaware corporation in July 2015 to focus on the development of oncology drug candidates, all of which are based on license agreements with The University of Texas System on behalf of the M.D. Anderson Cancer Center, which the company refer to as MD Anderson. Moleculin Biotech has three core drug technologies: a uniquely designed anthracycline (Annamycin), a portfolio of STAT3 inhibitors (WP1066 Portfolio) and a collection of inhibitors of glycolysis (WP1122 Portfolio). The company's clinical stage drugs are Annamycin, an anthracycline designed to avoid multidrug resistance mechanisms with little to no cardiotoxicity being studied for the treatment of relapsed or refractory acute myeloid leukemia, more commonly referred to as AML, and WP1066, an immuno-stimulating STAT3 inhibitor targeting brain tumors, pancreatic cancer and AML. Moleculin Biotech is also engaged in preclinical development of additional drug candidates, including additional STAT3 inhibitors and compounds targeting the metabolism of tumors.
The company currently have six drug candidates representing three substantially different approaches to treating cancer. Liposomal Annamycin, which the company refer to as Annamycin, is a chemotherapy designed to inhibit the replication of DNA of rapidly dividing cells. WP1122 and its analog, WP1234, are inhibitors of glycolysis intended to cut off the fuel supply of tumor cells, which are often overly dependent on glycolysis as compared to healthy cells. And, finally, the company believe that WP1066, WP1732, and WP1220 have shown capability, in in vivo testing, of altering the cell signaling associated with tumors. The company currently have two drugs in three clinical trials.1
The company's most mature drug candidate is Annamycin, an anthracycline being studied for the treatment of relapsed or refractory AML. Annamycin had been in clinical trials pursuant to an investigational new drug application, or IND, that had been filed with the U.S. Food and Drug Administration, or FDA. Due to a lack of development activity by a prior drug developer, this IND was terminated. To permit the renewed investigation of Annamycin, the company submitted a new IND for a Phase I/II trial for the treatment of relapsed or refractory AML in August 2017, which the FDA allowed to go into effect in September 2017. Currently, three sites are open and recruiting patients in this US trial.
Moleculin Biotech has five other drug development projects:
WP1066 has an approved physician-sponsored clinical trial open for enrollment for the treatment of brain tumors and is also being evaluated for potential treatment of AML and pancreatic cancer,WP1220, an analog of WP1066 is being studied for the topical treatment of cutaneous T-cell lymphoma (CTCL) for which Moleculin Biotech has filed a CTA in Poland which, if approved, will give it a third drug in clinical trial,WP1732, another analog of WP1066 that the company believe is particularly well suited for intravenous administration is being evaluated for potential treatment of AML, pancreatic and other cancers, andWP1122 and WP1234 are being evaluated for their potential to treat brain tumors and pancreatic cancer via their ability to inhibit glycolysis.
Moleculin Biotech has been granted royalty-bearing, worldwide, exclusive licenses for the patent and technology rights related to all of its drug technologies, as these intellectual property rights are owned in part or entirely by MD Anderson. The Annamycin drug substance is no longer covered by any existing patent protection, however, the company intend to submit patent applications for formulation, synthetic process and reconstitution related to its Annamycin drug product candidate, although there is no assurance that the company will be successful in obtaining such patent protection. Independently from potential patent protection, Moleculin Biotech has received Orphan Drug designation from the FDA for Annamycin for the treatment of AML, which may provide tax and other benefits during product development, and if the product is approved for AML, may lead to a grant of a seven-year market exclusivity. Under that exclusivity, which runs from the date of approval of a New Drug Application (NDA) in the United States, the FDA general (there are important exceptions) could not approve another Annamycin product for AML. The company also intend to apply for similar status in the European Union (EU) where market exclusivity extends to 10 years from the date of Marketing Authorization Application (MAA) approval. Separately, the FDA may also grant market exclusivity of 5 years for newly approved new chemical entities (which the company believe Annamycin would be), but there can be no assurance that such exclusivity will be granted.
With regard to additional potential clinical activity, the company received Polish National Office approval in June 2018 for a CTA in Poland, which enables it to begin a Phase I/II clinical trial there to study with Annamycin for the treatment of relapsed or refractory AML. This will be in addition to the previously announced allowance of its IND in the United States. The start of clinical trials in Poland is expected to begin in the second half of 2018. In the US, Moleculin Biotech has three sites recruiting patients and ready to provide treatments. Patient treatment began in the US in March 2018. In addition, the company continue to recruit and contract with clinics both in the United States and Poland. The company can provide no assurance of additional recruitment or that treatments will occur in the near term and on a timely basis, if at all.
The company continue to recruit additional clinics into this trial both in the United States and Poland. In the US, Moleculin Biotech has begun treating patients and have three sites open recruiting and ready to treat patients. Moleculin Biotech is actively pursuing additional treatment centers, both in the US and in Poland, to increase the access of this trial to potential patients. The company can provide no assurance additional sites, recruitment or treatments will occur in the near term and on a timely basis, if at all.
On May 1, 2018, the company engaged another CRO to evaluate additional countries for the expansion of its AML clinical trial, specifically Australia and several Western European countries to provide additional clinical sites to improve access for patients to its Phase I/II trial.
In July 2018, the physician-sponsored WP1066 trial IND for the treatment of glioblastoma opened for recruitment in the US.
Furthermore, in September 2017 the company engaged a CRO to prepare for a proof-of-concept clinical trial in Poland to study its drug candidate WP1220, a part of the WP1066 portfolio, for the treatment of CTCL. The company filed a CTA in Poland for this use which, if approved, will give it a third drug in a clinical trial.
Corporate Overview
Moleculin Biotech was founded in 2015 in order to combine and consolidate the development efforts involving several oncology technologies, based on license agreements with MD Anderson. This effort began with the acquisition of the Annamycin development project from AnnaMed, Inc., or AnnaMed, followed by the acquisition of the license rights to the WP1122 Portfolio from IntertechBio Corporation, or IntertechBio. Further, on behalf of Moleculin, LLC, the company entered into a co-development agreement with Houston Pharmaceuticals, Inc., or HPI, which culminated with the merger of Moleculin, LLC into MBI coincident with its initial public offering allowing it to gain control of the WP1066 Portfolio.
Moleculin, LLC was formed in 2006 and was working to develop the WP1066 Portfolio it licensed from MD Anderson. On May 2, 2016, Moleculin, LLC was merged with and into MBI. As a result of the merger, the company issued the holders of Moleculin, LLC equity interests and convertible notes an aggregate of approximately 999,931 shares of its common stock. Since Moleculin, LLC commenced operations in 2006, substantially all of its efforts had been focused on research, development and the advancement of the WP1066 Portfolio. Moleculin, LLC did not generate any revenue from product sales and, as a result, incurred significant losses.
In June 2018, the company formed Moleculin Australia Pty. Ltd., a wholly-owned subsidiary to oversee pre-clinical development in Australia. The Australian government provides an aggressive incentive for research and development carried out in their country. The company believe having an Australian subsidiary could provide a great opportunity to speed up pre-clinical development and reduce the overall cost of its continued drug development efforts.
The company do not have manufacturing facilities and all manufacturing activities are contracted out to third parties. Additionally, the company do not have a sales organization.
Portfolio Status
Below are important developments for each drug/portfolio of MBI.
Annamycin
The company's most mature candidate is Annamycin, for which FDA has allowed an IND to go into effect for a Phase I/II trial for the treatment of relapsed or refractory AML and for which the agency has granted Orphan Drug designation for the treatment of AML. Moleculin Biotech is conducting Phase I/II clinical trials for Annamycin in the US and Poland as a monotherapy for the treatment of relapsed or refractory AML.
Clinical Trials for Annamycin
In October 2016, the company adjusted its clinical strategy for Annamycin by adding in a Phase I arm to its trial, which adds expense to its development effort. The company believe this change in strategy will add several months to the eventual final approval of the drug, if the drug is approved.
Because the prior developer of Annamycin allowed their IND to lapse, the company were required to submit a new IND for continued clinical trials with Annamycin. The company filed its IND application for Annamycin, with the clinical strategy of increasing the maximum tolerable dose mentioned above on February 10, 2017. In subsequent discussions with it, FDA requested certain revisions to the protocol, additional information, and additional data related to Chemistry, Manufacturing and Controls ("CMC"). The company made the requested revisions to the protocol and included the CMC data in its re-submission of the IND in August 2017 and the FDA allowed this IND in September 2017.
In August 2017, the company met with the European Medicines Agency ("EMA") to discuss a CTA in Europe for the study of Annamycin for the treatment of AML. As a result of that meeting, the company decided to proceed with an application in October 2017 for a CTA for Annamycin in Poland. Unlike in the United States, the process for beginning a clinical trial in Poland requires a hospital contract before a request for CTA can be made. The company obtained the required hospital contract, which allowed the formal request for Polish approval. In December 2017, the Ethics Committee in Poland approved its Phase I/II trial of Annamycin for the treatment of relapsed or refractory AML. A final approval was required by the Polish National Office which was received in June 2018. The start of clinical trials in Poland is expected to occur in the second half of 2018. Moleculin Biotech has one site open for clinical trial in Poland. The company can provide no assurance that such trial will begin on a timely basis, if at all.
The company continue to recruit additional clinics, both in the US and Poland. In the US, Moleculin Biotech has begun treating patients and have three sites open recruiting and ready to treat patients. The company can provide no assurance additional sites, recruitment or treatments will occur in the near term and on a timely basis, if at all.
On May 1, 2018, the company engaged another CRO to evaluate additional countries for the expansion of its AML clinical trial, specifically Australia and several Western European countries, to provide additional clinical sites to improve access for patients to its Phase I/II trial. This effort is ongoing.
One of the key dose-limiting toxicities associated with currently available anthracyclines is their propensity to induce life-threatening heart damage. In its current Phase I/II trial for Annamycin, the company will collect data to further validate the design intent of Annamycin to have little or no cardiotoxicity.
On March 21, 2017, the company received notice that FDA had granted Orphan Drug designation for Annamycin for the treatment of AML, effective March 20, 2017.
The WP1066 Portfolio
Moleculin Biotech has a license agreement with MD Anderson pursuant to which Moleculin Biotech has been granted a royalty-bearing, worldwide, exclusive license for the patent and technology rights related to its WP1066 Portfolio and its close analogs, molecules targeting the modulation of key oncogenic transcription factors.
Active and Planned Clinical Testing of WP1066 Portfolio
In vitro testing has shown a high level of activity for WP1066 against a wide range of solid tumors, and in vivo testing has shown significant activity against head and neck, pancreatic, stomach, and renal cancers, as well as metastatic melanoma and glioblastoma, among others. In vivo testing in mouse tumor models has suggested that WP1066 inhibits tumor growth, blocks angiogenesis (a process that leads to the formation of blood vasculature needed for tumor growth) and increases survival.
With respect to its WP1066 Portfolio, the company collaborated with a clinician at MD Anderson who submitted an IND for WP1066 treatment of brain tumors to the FDA. In December 2017, the FDA allowed this application for a Phase I trial of WP1066 in patients with recurrent malignant glioma and brain metastasis from melanoma, to go into effect. This trial opened for recruitment in July 2018.
This Phase I trial with WP1066 drug is mainly funded by $2 million in private grant funding at MD Anderson which is in addition to two Specialized Programs of Research Excellence (SPORE) peer reviewed grants awarded by the National Cancer Institute. The company believe the rigorous peer-review process applied to SPORE grant applications represents an important additional measure of independent assessment and validation of the research connected with its approach to using WP1066 as an inhibitor of STAT3 for the treatment of cancer. The grants described here are not reflected in Moleculin's financial statements, but instead are applied to the cost of pre-clinical and clinical activities at and conducted by MD Anderson.
However, as this is a physician-sponsored clinical trial, Moleculin Biotech has limited influence on the progression of the trial and, as such, may not be able to prevent disruptions that may delay the treatment of patients with WP1066.
An analog of WP1066, referred to as WP1220, was previously the subject of an IND related to use of the molecule in the topical treatment of psoriasis. Clinical trials were commenced on WP1220 in the US, but were terminated early due to limited efficacy in the topical treatment of psoriatic plaques. Notwithstanding its limitations in treating psoriasis, its pre-clinical research in multiple CTCL cell lines has suggested that WP1220 may be effective in inhibiting CTCL. Based on this data, Moleculin Biotech is collaborating with a Polish drug development company, Dermin, which has received Polish government grant money to develop WP1220 in Poland for the topical treatment of early stage CTCL patients. CTCL is a potentially deadly form of skin cancer for which there are limited treatment options.
In September 2017, the company engaged a CRO to prepare a proof-of-concept clinical trial in Poland to study WP1220 for the topical treatment of CTCL. The company filed a CTA in Poland for this use which, if approved, will give it a third drug in a clinical trial.
The WP1122 Portfolio
Moleculin Biotech has a license agreement with MD Anderson pursuant to which Moleculin Biotech has been granted a royalty-bearing, worldwide, exclusive license for the patent and technology rights related to its WP1122 Portfolio and similar molecules targeting the treatment of glioblastoma multiforme ("GBM") and related central nervous system malignancies.
The company believe this technology has the potential to target a wide variety of solid tumors, which eventually become resistant to all treatments, and thereby provide a large and important opportunity for novel drugs. Notwithstanding this potential, Moleculin Biotech is focused on the treatment of central nervous system malignancies and especially GBM. Although less prevalent than some larger categories of solid tumors, cancers of the central nervous system are particularly aggressive and resistant to treatment. The prognosis for such patients can be particularly grim and the treatment options available to their physicians are among the most limited of any cancer.
Moleculin Biotech has preliminary preclinical data for WP1122, including in vitro activity against cancer cell lines, as well as data on survival of animals subjected to xenografts of human brain tumors, including data regarding biodistribution and pharmacokinetics. In non-optimal doses and treatment regimes, WP1122 performed equal to or better than the current market leader, temozolomide and provided for superior survival of animals treated in combination with temozolomide. Notwithstanding these early results, the company recognize that substantial additional preclinical and clinical research remains to be done and may not support these initial findings or their translation into activity in humans. Moleculin Biotech has begun planning the necessary pre-clinical work for WP1122.
The company's current sponsored research agreement with MD Anderson is funding further research on WP1234, which is being evaluated for its potential to treat brain tumors and pancreatic cancer via its ability to inhibit glycolysis.
Recent Business Developments
Below are recent business developments.
Moleculin Seeks Approval from Polish Regulatory Agency for Skin Cancer Clinical Trial
On August 9, 2018, the company announced that the company had submitted a request to Polish authorities for clinical trial authorization for its STAT3 inhibitor, WP1220, for the treatment of Cutaneous T-Cell Lymphoma. This request for CTA, if approved, will give it a third drug in clinic. Published research supports the belief that Cutaneous T-Cell Lymphoma, a deadly form of skin cancer, may be highly dependent on the upregulation of the activated form of STAT3. The company believe WP1220 may be ideally suited as a topical agent to inhibit STAT3 and therefore could potentially become a valuable new drug for the treatment of CTCL. A request for CTA in Poland is the equivalent of a request for Investigational New Drug status in the U.S. This follows its announcement in June 2018 of the approval of a CTA in Poland for its drug Annamycin for the treatment of AML.
Moleculin Announces Enrollment Opens for Brain Tumor Trial of WP1066
On July 31, 2018, the company announced enrollment opened for a physician-sponsored clinical trial of WP1066 for the treatment of glioblastoma and brain metastases in adults. This is the first investigator-initiated trial of WP1066, an important milestone. The goal of this clinical research study is to find the highest tolerable dose of WP1066 that can be given to patients with recurrent (has returned after treatment) cancerous brain tumors or melanoma that has spread to the brain. The safety of this drug will also be studied. WP1066 is designed to target the STAT3 pathway in cancer cells, which independent research has shown allows these cells to survive and proliferate, increases new blood vessels to the tumor, causes the cancer cells to move throughout the body and brain, and reduces the ability of the immune system to effectively combat tumor development. In addition, the company believe that WP1066 may also have the potential to stimulate a natural anti-tumor immune response.
Announcements Involving its STAT3 Inhibitor WP1066 Portfolio which includes WP1732
In February 2018, the company announced that, pursuant to its continued collaboration with MD Anderson the company had developed and licensed what the company believe, based on pre-clinical testing, may be a potential breakthrough - WP1732, a new molecule in the WP1066 portfolio - in its effort to develop a new cancer treatment that selectively kills highly resistant tumors. The company believe this new discovery could improve its ability to treat a broader range of the most difficult cancers, and especially pancreatic cancer. Specifically, Moleculin Biotech has preclinical evidence to suggest this new molecule is capable of controlling a process known as 'ubiquitination' to block the activated form of STAT3, an important oncogenic transcription factor.
In July 2018, the company announced the company had begun pre-clinical toxicology testing of WP1732, a fully water-soluble STAT3 inhibitor and a candidate to treat pancreatic cancer, through its new subsidiary in Australia. By utilizing its subsidiary in Australia and the attractive R&D tax credits it offers, the company believe the company can accelerate the pre-clinical work of WP1732. The company anticipate completing the filing and approval of this IND in 2019. The company can provide no assurance that such filing and, ultimately, approval of this IND will occur on a timely basis or if at all.
In June 2018, the company announced that the company had entered into an agreement with the Jagiellonian University in Krakow, Poland, for the development of its STAT3 inhibitor, WP1732, for the treatment of ocular tumors. The company believe that there are very limited options for the treatment of ocular tumors. The company believe that the water soluble nature of WP1732 could make it an ideal candidate for targeting these unique and highly metastatic tumors.
Also in June 2018, the company announced that the company entered into an agreement with The University of Iowa Pharmaceuticals for the development of a formulation for WP1732. WP1732, which the company believe, based on pre-clinical testing, may be a breakthrough discovery, is now advancing to the stage of formulation development. The company believe that this agreement marks the beginning of its creating a pre-clinical package to submit to the FDA in order to request Investigational New Drug status.
$2.3 million Registered Direct Offering
On June 22, 2018, the company entered into an agreement with institutional investors for a registered direct offering of securities with gross proceeds of approximately $2.3 million. Concurrently, with the sale of common shares, pursuant to the agreement, the company also sold warrants to purchase 710,212 shares of common stock. Subject to certain beneficial ownership limitations, the warrants will be initially exercisable on the six-month anniversary of the issuance date at an exercise price equal to $2.02 per share of common stock, subject to adjustments as provided under the terms of the warrants. The warrants are exercisable for five years from the initial exercise date. The closing of the sales of these securities under the agreement closed on June 22, 2018.
$9 million Registered Direct Offering
On February 16, 2018, the company entered into a Securities Purchase Agreement (the "Purchase Agreement") with certain institutional investors for the sale by it of 4,290,000 shares of its common stock, at a purchase price of $2.10 per share. Concurrently with the sale of the common shares, pursuant to the Purchase Agreement, the company also sold warrants to purchase 2,145,000 shares of common stock. The company sold the common shares and warrants for aggregate gross proceeds of approximately $9.0 million with net proceed approximating $8.2 million. Subject to certain beneficial ownership limitations, the warrants will be initially exercisable on the six-month anniversary of the issuance date at an exercise price equal to $2.80 per share of common stock, subject to adjustments as provided under the terms of the warrants. The warrants are exercisable for five years from the initial exercise date. The closing of the sales of these securities under the Purchase Agreement closed on February 21, 2018.
Lease Agreement
On March 22, 2018, the company entered into a Lease Agreement (the "Lease") with IPX Memorial Drive Investors, LLC (the "Landlord") for the lease of 2,333 rentable square feet "RSF", which Moleculin Biotech is using for corporate office space and headquarters. The term of the Lease began in August 2018 and will continue for an initial term of 66 months, which may be renewed for an additional 5 years. Moleculin Biotech is required to remit base monthly rent of approximately $4,300 which will increase at an average approximate rate of 3% each year. Moleculin Biotech is also required to pay additional rent in the form of its pro-rata share of certain specified operating expenses of the Landlord. The newly leased space is located in Houston, Texas.
