Regeneus (ASX:RGS) CEO, Leo Lee talks about its collaboration with Kyocera of Japan to market Progenza its cell therapy treatment for anti-inflammatory treatment and repair of damaged or diseased tissue.
Rachael Jones: Hello, I'm Rachael Jones with the Finance News Network. Joining me today from Regeneus is CEO, Leo Lee. Leo, welcome back to FNN.
Leo Lee: Rachael, nice to be back and nice to see you again.
Rachael Jones: You too. Now, first up to your news with Kyocera. Regeneus has achieved a significant milestone with this collaboration and their license agreement with Kyocera. Can you tell us more about this?
Leo Lee: We’re very excited to have signed this agreement. Our lead technology focuses on pain, and it’s called Progenza for treatment for Knee OA
In the age group of 65+, 1 in 4 people experience knee pain as part of Knee OA.
Japan OA market is significant with 26M people potentially suffering from OA, with 1.25M people in clinic already receiving treatment, and this number grows each year.
What this collaboration enable us to do is partner with a company like Kyocera who have a very strong presence in knee replacement, with a strong commercial operations and KOL engagement in Japan.
A few important components to the deal:
i. A$27M in upfront and milestone-related payment
ii. Also a double-digit royalty component associated with future sales
The global OA market is expected to grow to US$3.5B by 2026, and Japan is expected to be 10% of this market (US$350M), so we are tapping into the market potential of this disease
What this agreement allows us to do is take the funds and allow us to be fully funded to market in Japan and allow us to explore our technology in other disease areas.
Rachael Jones: Thanks Leo. Could you remind us, what has been the clinical evidence to support Progenza osteoarthritis?
Leo Lee: Yeah. Thank you for asking. We've already concluded a phase one clinical study in Australia, and we're very excited by the data that we have seen. We have met our primary safety as well as secondary efficacy end points. Probably what's most exciting is that we see really good pain reduction with our therapy and more importantly, it actually augments the disease, which means it impacts cartilage in the knee. What we showed in our clinical study is that it actually protects the cartilage over the 12 month period of our study, and we think this will be really impactful and change how the disease will be treated going forward.
Rachael Jones: Excellent. Leo, can you briefly explain the decision to go to Japan for this technology? Will other regions be in discussion?
Leo Lee: Sure. I think it's quite common that companies typically will focus on US or Europe as a starting point, but Japan has a very unique regulatory framework for regenerative medicine and our product is a mesenchymal stem-cell therapy, and it's covered under the regenerative medicine framework. So, what that really implies is that it's a bit of a super highway for clinical development. You only really need one study that shows efficacy of the product and the Japanese government will allow you to access the market, receive reimbursement by the government and start to give early access to patients in Japan. Now the agreement with Kyocera really is only focused on Japan, and we will be looking at collaborative agreements both in Europe and the US.
Rachael Jones: Leo, Progenza is your lead platform technology, but you also have a secondary platform technology, Sygenus. What clinical need does that address?
Leo Lee: Sure. We have two platforms. One is called Progenza, which just primarily consists of mesenchymal stem cells and secretomes. Secretomes are really the active molecules in which a stem cell secretes, that has all of the biological activities. Sygenus is only the secretomes, which are the secretions which has the active molecules that can impact various diseases. We intend to leverage the collaboration with Kyocera in the upfront payments to develop on both platforms. For Progenza, we intend to expand into additional indications. In relation to Sygenus, we will complete our preclinical data package and start to look for commercial partnerships in regions around the world.
Rachael Jones: To the last question now, Leo. You joined Regeneus as the CEO just over 18 months ago, and since then a lot has been achieved. What's ahead for the next six months, and what key milestones can shareholders look out for?
Leo Lee: Yeah. It's been a really exciting 18 months and I'm very happy about joining Regeneus. The patent portfolio which we have is exciting. I think we have achieved a lot of very important milestones to put us on the right trajectory, to be a very focused company in the area of pain. In the next six months, I think everyone can expect that we'll be initiating some of the phase two studies, which we have been discussing. Certainly we'll be progressing through regulatory consultation in Japan and start to enter into the design of the phase two study. We do intend to start a phase two study in Australia, in the area of neuropathic pain.
Rachael Jones: Leo Lee, thanks so much for the update and congratulations on progress.
Leo Lee: Thank you very much.