Race Oncology (ASX:RAC) CEO, Peter Molloy talks about its Investigational New Drug (IND) Application with the U.S. FDA for its leukemia drug candidate Bisantrene.
Rachael Jones: I'm Rachael Jones with the Finance News Network. Joining me from Race Oncology (ASX: RAC) is CEO Peter Molloy. Peter, welcome back to FNN.
Peter Molloy: Thank you, Rachael. Good to be back.
Rachael Jones: Now, Race Oncology (ASX:RAC) describes itself as a specialty pharmaceutical company that looks for drugs that are often overlooked by big pharma. What can you tell me about your drug Bisantrene?
Peter Molloy: Bisantrene is a chemotherapy drug designed to treat a cancer, a blood cancer called acute myeloid leukaemia (AML) and this is a terrible disease with a very poor prognosis if you get it. It was a lost asset, we found it and now we own it. And we own it because we have filed new patents on the drug and we have orphan drug designation, which gives us exclusivity. So, our goal now is to finish off the development on this valuable drug, and get it to market, or put it in the hands of a partner.
Rachael Jones: And what does the development pathway look like for Bisantrene?
Peter Molloy: Well, our goal is to complete a registration study that will allow us to get marketing approval for Bisantrene in the U.S. Before we can do that, we have got to manufacture the drug, and fortunately, we have succeeded in doing that. We've also got to have pre Research and Development (R&D) discussions with the Food and Drug Administration (FDA) to figure out the exact pathway and what the clinical trial is going to look like. We have had those discussions.
The next step is to file what's called an Investigational New Drug Application, or IND. We expect that is going to happen towards the end of the first quarter next year. That will position us, hopefully, to start the trial in the second half of next year.
Rachael Jones: And what is the size of the market, and the patent position?
Peter Molloy: First of all, the patent position is such that we've recently filed new patents on this drug. This is an old drug, and the original patents have expired. We have filed new ones, and they have currency until 2034. And two of those patents are granted in the U.S., which is very important.
The other part of the patent story is that we have orphan drug designation in the U.S., and that gives us seven years of exclusivity from the date of registration approval.
In terms of the market size, this is what we call an orphan disease, because it's relatively rare, but even so, it is expected to be a multi-hundred-million-dollar a year market in terms of sales, so the prize is certainly worth pursuing. And we are also actively pursuing a very important unmet medical need here in acute myeloid leukaemia (AML).
Rachael Jones: And Peter, can you tell us what the trial will involve?
Peter Molloy: The trial will involve at least 100, maybe 200, subjects. They'll typically be adult subjects in this trial who have what's called relapsed refractory AML. That means that they've got acute myeloid leukaemia that has proven to be resistant to other drugs, or has relapsed after treatment with other drugs, which is a very common occurrence with this very difficult disease.
The trial will measure things such as clinical response to our drug compared with alternative therapies. It will also measure things like overall survival, and whether or not the patient can be transitioned to a bone marrow transplant.
Rachael Jones: And still on Bisantrene, the U.S. Food and Drug Administration (FDA) have given it a rare pediatric disease designation. What does this mean?
Peter Molloy: Well, this means that, by doing a small study in childhood AML in parallel to what we're doing with the adult relapsed refractory AML, potentially doing that small study, we could be awarded what is called a Priority Review Voucher. Now, a Priority Review Voucher is essentially a ticket to a fast-track FDA review that you can sell to other companies, and our intention would be to sell it. There is a very active secondary market for these Priority Review Vouchers, or PRVs, and they can sell for more than $100 million each, so it's a very valuable new designation, which is currently really not reflected in our market valuation.
Rachael Jones: And now let's talk about your financials, and your share price. What is your cash position, and how far will that take you?
Peter Molloy: At 30 June 2018, we had AUD$3.7 million in cash, which is projected to be enough to cover us for at least the current financial year. Over the last nine months or so, our share prices trended down substantially, much more than we believe it should have, and I think it has left us in a position where we're significantly undervalued.
Rachael Jones: And last question now, Peter. Why should investors consider adding Race Oncology (ASX:RAC) to their portfolios?
Peter Molloy: Our current share price indicates a valuation of only AUD$11 million, and yet, within the next six to nine months, we could have a phase III oncology asset in human trials. There is a big gap there in potential valuation, and upside for Race Oncology (ASX:RAC) investors.
Rachael Jones: Peter Molloy, thanks for the updates.
Peter Molloy: Thank you.