Theracryf (LSE:TCF) — Update on the Ox-1 programme

0:02 Good afternoon, and welcome to the THERACRYF PLC update on the OrexinOne program. Throughout this recorded meeting, investors will be in listen only mode. Questions are encouraged and they can be submitted at any time using the Q and A tab situated on the right hand corner of your screen. Simply type in your questions and press send. Before we begin, I would like to submit the following poll, and I would now like to hand you over to CEO, doctor Hugh Jones. Good afternoon. Good afternoon, Alex. Hello, everybody. Thanks for attending another one of our investor meet webinars. This one is slightly more technical and project orientated

0:34 today because yesterday, we had some very important news about our toxicology program on the lead asset, the orexin one blocker in addiction. Let's just remind ourselves what this is all about. Orexin system in the brain, there are two of them, is an impulsivity and alerting system. If you block orexin one, you block impulsivity. That's what we're seeking to do in addictions. If you block orexin two, you go to sleep, which is what we don't want if we're trying to treat addictions. We want people to be having as normal a daily life as possible, no sedation as a side effect, no sleepiness, daytime somnolence. And that's what we seek to do with this class leading orexin one blocker in THERACRYF. Here with me today, doctor Helen Cullman, our chief operating officer who's led the program to this point, which is a very important point in drug development.

1:28 So our exome one blocker, an addiction program, some very good news published yesterday, and here, we're gonna do this brief webinar by q and a. I'm gonna start asking eight or nine questions of Helen, which

1:41 hopefully will bring you into the excitement that we share about the progress we've made on this program. And then Helen's gonna reverse the polls when we get to some of the more commercial points. We also have a q and a system within the IMC webinar, so please type your questions to us, and we'll attempt to answer all of them as they occur. We have some presubmitted ones already. So let's start then, with yesterday's RNS. Helen, the preclinical package is now complete. Why is this important? And what does it allow us to do next? Well, it... It's really important from a company perspective because, you know, at the end of this process, we have an asset that hopefully we'll be able to say is clinic ready. So to be a clinical company is a massive transformation, based on the addiction program.

2:33 This has been obviously a long time coming since last year's fundraise, about eighteen months worth of work. So really hefty package of work, multiple modules within it to get to this point. And what we have now is the completion of all study based activities, and we've got reports coming in and being finalized even as we speak. So the finalization of those reports, go through a lengthy q and a process, so really the boring part of the activity now, the information from that gets pulled out and it populates, what's called an investigator brochure. An investigator brochure is a well known piece of documentation that's used for regulatory, purposes. And once we have all of that documentation collated, we'll be able to fill out, the application for the ethics approval, which is our Australian process we need to go through. And the ethics approval will then hopefully, be a positive outcome for us, and we'll be able to notify what's called the TGA in Australia, which will give us permission to then dose, humans. So in the first instance, healthy volunteers with our product.

3:41 Great. Thanks. So the next question, what did the final toxicology results show, and was there anything that particularly stood out for you? Slightly rhetorical, this one. I know because we were sort of joking about this the other day. So nothing really stood out, which from a toxicological perspective is a really positive thing.

4:02 In some of our previous RNSs, you'll know that we made a lot of material. So in previous earlier studies, we did some smaller exploratory toxicology, which is what gave us real confidence in the compound. And I think we've said before in presentations, you know, we have high confidence this compound is gonna perform these preclinical studies. And, actually, it did as as we said it would, and and I think exceeded as we put... Exceeded our expectations. And that caused some complexity because we had to make a lot of material, a lot of drug material to put into the animals that were being tested because we had to go up to such high levels. So usually in toxicology, you you do increasing dosing until you see some adverse signal, And it's expected that you do see an adverse signal because that gives you your sort of ceiling that then informs your human dosing.

4:57 Now, actually, we didn't really... We didn't see anything. So for the twenty eight day, we gave up to the regulatory maximum to one one gram a kilo in in the larger animals. And, you know, it was well tolerated. We didn't see anything adverse from a histopathological perspective, you know, which is which is great. So it was a really positive outcome. Yeah. No news is good news when you're talking toxicology. Right? So let... Let's give the audience a bit more insight into what else was in this huge package of work that you've been supervising. Yeah. So I know that we've... We highlighted what we considered were the major, hurdles to overcome, and that really was the twenty eight day tox. So this is where you dose animals daily over a twenty eight day period. And what you see there is, you know, you see, how they react to that over a long period, the accumulation of the drug in the system, which you don't see with shorter time period dosing, and you you then enable them to recover if they need to recover. In this case, they didn't. And then you look at them again once they've recovered. And that is still, I think, the the pivotal piece of data for the activities we did. But all under that is a number of additional GLP studies, that's good laboratory practice studies that

6:21 that that were also done in parallel. So, for example, we look at genetic susceptibility. So a genotox, does it interfere with your DNA?

6:30 We look at photosensitivity. So we dose animals, we irradiate them and see if there's any issues with their skin, because that could be, an issue. And some drugs actually on the market are photosensitive. You you know, you're told you have to weigh your factor 50, so that's an important factor to consider. And another major study is to do with your cardiovascular system. So it does have any effects on your heart or your blood pressure, and that was one of the later ones to be completed as well. And that was called a CV, telemetry study. So there are lots of these little studies ongoing, some in vitro, some in vivo, so some in the test tube or some, within a whole animal system that is really bringing together all of the information we have now about the compound to enable us to get that clearance for going into humans.

7:21 And they're all complete and pretty boring as we've said. Right? Yes. No. Not boring. Highly exciting. But Well, it's exciting, and then no news is good news kind of way, isn't it? Yeah. Yeah. Yeah. So the next one, the highest dose tested was approximately 70 times the anticipated human level. This is a very subtle bit of pharmacology... Pharmacokinetics, indeed. How should investors interpret that finding? I mean, what do we still need to show in humans is the second part of that question.

7:51 So I can't... I'm not gonna go into the technical details because, you know, doses and exposures and all of that can get a little bit confusing, but I think I'd just like to highlight what I said before. We went up to really high doses,

8:06 much more than is needed for, an effect, so an efficacious dose. And that really informs then... So the information and the PK information from that study and the outcomes in the study informs where you start dosing in your phase one. So for a phase one human volunteer study, your major outcome again is safety and tolerability, and you're looking for information on how your drug is absorbed in humans, like how much you have circulating the system, how how much gets into the brain. So the information we've got from the animal studies we've concluded now, that's really informing and going into the protocol writing is where we should start. And, you know, if you start to have safety signals, you might want to look at your starting dose in humans to be much, much lower than what your efficacious dose is, and then you titrate up until you start seeing maybe some, some tolerability issues or adverse effects. So we know that we hopefully have a good enough what's called safety margin coming out of this. So we shouldn't be too concerned about going way, way below our efficacious dose when we start off with that phase one dosing. Or even the top dose we explore in one, given the level of safety margin we've seen, you know, it gives us the option to explore some very high doses should they be necessary, which we don't think they are. Okay.

9:29 So that's a a good wrap up, in relatively quick ten minutes about the toxicology data and their importance, and they're very important and very important to see a very broad margin of safety. To, manufacturing now, I suppose, alongside the toxicology results, we've previously highlighted a more efficient manufacturing process and new intellectual property. So what difference do these make to the program overall? So they make a really important commercial difference to the program. So we spent the first six to nine months optimizing manufacturing process and scaling up drug to produce enough to do all of these studies. But in doing that, the amazing chemistry team at Farmer On found new ways of doing that process, which, really are much more efficient. And not only more efficient, they brought about new intellectual property for us.

10:26 So, commercially, our industry relies on intellectual property. Right? So that protects your time on the market without competition. And the more time you can have without competition to get your revenue, the better. So it's good to have a number of patents called a sort of patent strategy or patent family around your main composition of matter patents to enable that term to be longer and longer. So that was one really important outcome from that activity. But, also, commercial partners look at efficiency of your process because they want to gain high margins on the product when eventually it becomes, you know, a a commercial product. So to get an efficient process. And there's always more opportunity, right, to to go back and look at further optimization, but I think where we got in that first process was really, really good.

11:20 Great. Thanks. Yeah. And, agree, important for partnering, a good commercial margin. And this question just popped up, which we'll deal with later on manufacturing. Thank you for that.

11:28 So obvious next question, really, what work remains to be done before the planned Australian submission in November, and what needs to happen to get the approvals in Australia by year end? Yeah. So all of that experimental activity is now complete. As I mentioned before, it's, going through the quality, assurance process for the finalization of the reporting. So all of that documentation, and like I said, we're now draw... Drawing that out and putting it into the investigator brochure and the applications information for Australia ethics. I think in terms of sort of timelines, we stated we're really targeting getting an approval before the end of the year, and we've given ourselves a a big target, big challenging target for that, really. So it means we have to do a lot of things in parallel to be able to get the submission in on time, and we're we're targeting submission for mid November.

12:26 And really depend on the amount of questions that we might have back from us, how quickly that process moves forward. But we will get a response from ethics committee. We will then have to notify, as I said, this, the TGA. And after that, hopefully, we'll be able to put our r and s out saying that, you know, we have the approval, and we're ready to to go ahead subject to, you know, our our situation at the time. Great. And and, obviously, a clear question that comes up reasonably often. Why Australia for your first in human study? So I think there's a good reasons for that, but I'll let you explain to the audience what they are. Yeah. You'd love to talk about this too because it's a a good commercial topic. And I think, you know, up until about a year or two ago, it wasn't really on the radar to do your clinical activity in Australia. But now for a number of European companies and for American companies, Australia seems to be the place to go. You know? It's got a lot of investment.

13:27 I have to say from our, VP clinical development who visited Australia when we were choosing the providers was absolutely blown away with the investment in the infrastructure there, the sites, the, you know, the organizations, the capabilities, and the amount of activity. And for phase one, at least, you have no competition. You have individual phase one centers in each major cities. They're not competing against each other for recruitment, but recruitment is only one technical factor. Obviously, the major factor is cost. You know, when you compare them, and we've done a, looked at proposals from European providers alongside our Australian providers, and they're really competitive on a cost basis.

14:15 When we also then look at the exchange rate, that makes it even more attractive because we've got a really good exchange rate at the moment. Excuse me. And then, of course, the cherry on the top is having the tax credit. So having that 43% then fed back in, obviously, at the end, you have to come to the end and claim it, but fed back in,

14:35 to the company to then apply to other programs. So all of those factors making it, you know, the most attractive place to go to, at least for phase one studies at at the current time. The Australian data, while you're coughing there, is, widely accepted across the world. We know that. We've checked. We know that from other companies, including Big Pharma who are doing work there, that the data they generate is good as anywhere, and the FDA accepted Europeans and the British regulatory agencies all accept Australian phase one data. So there's every reason. Speed and cost and tax credits make it a very attractive place to do that first in human,

15:12 study. On that study then, the question here is, what's it gonna establish? What is the phase one aim, and how will its findings inform the next stage of development? Yeah. So in keeping with the majority of of phase ones, we're really looking at safety and tolerability. So we do, escalating dosing, you know, as we do in the animals to see if we see any negative feedback from those human volunteers. And importantly, you know, we have a wealth of data from the preclinical studies, and our team have done modeling on that. So what we should expect to see circulating in people from the dose we give, but we really need to confirm that, and that's what the phase one gives us. So if you're giving this dose, how much of it is absorbed in the system? How much is circulated in the blood? So in the systemic system.

16:04 And, also, because we're looking at having a a brain effect, a CNS effect, we need to understand how much of our compound is getting into the brain to exert that effect, and we'll be taking CSF, that's cerebrospinal fluid samples from some of these volunteers to really confirm what that is. So we'll then sort of double check, did the modeling, you know, bear out within the human, and that will be our definitive data that then will inform what's taken forward into a patient population. Great. But time to turn the tables now. And turn turn you into Clive Myri for this one if you have mastermind fun. So so fire away. Yeah. So I... You know, we've talked a lot about addiction and substance use disorders, and we have our own data in binge eating.

16:56 But, obviously, there's other potential applications for our compound in alcohol, other substance use disorders, cocaine. And I think we often get the question. And I'll turn it back to you. You know, how do we prioritize the indications that we go for? Yeah. A question comes up very often. Look. We... Indications, as they're called, that is the the label or the permission you seek when you get a marketed product. It's one of the most important things you can do in drug development. A lot of drugs apparently have failed because people chose the wrong thing to study or the wrong condition to study. So we put a lot of sweat and effort into choosing the right indication, the right condition. And our lead indication, and we have data in models of this, is binge eating disorder. That is more common than anorexia and bulimia combined.

17:49 It's a hidden epidemic, 7,000 calories in a sitting, not just in a day, followed by remorse and further planning and depression. So it's a... An underserved market. That's one of the big considerations for us. Is it clinically underserved? Is there a big market? And the answer to both of those is yes. What's the competitive environment like in binge eating disorder? Well, it's low, actually, if this is not being obese. Not many of these binge eaters are obese. They overcompensate in other ways. So it may not be ideal for the GLP ones. It's a question that comes up quite often for us. What's this like compared to a GLP one? Well, this is an anti impulsivity drug, not a weight loss drug. Not all people want to lose weight. They just want the impulse to go away or to be reduced.

18:37 And that's how we choose it. Unmet medical need, size of the market. There's one drug approved for binge eating specifically, and that's only in The US and Canada. So competitive intensity low. Put those two together, and it makes a good start point. However,

18:54 we think this mechanism will work, and there's some data out there in cocaine use disorder and in alcohol use disorder. What we don't know yet is whether it will work in conjunction with a GLP one, injection, and that'd be a question we'd love to answer. So we choose them carefully, but the bottom line, the strategy for this program, indeed our business model, is to partner. Partner these assets at the right point. And, where a partner wants to go is where we will take it. And that's, you know, the short It's segue a

19:30 for me because I think that is sort of what we want to talk about next. And the next very frequent question we get is about partnering. And so the recent announcement refers to commercial interests from potential partners awaiting phase one data. We've talked about interest we've received before and and rejected.

19:50 But this is slightly more technical. So which findings are likely to matter most to a partner, and how are we preparing for those discussions? The program's done very well from those points of view. Partners wanna see a clean profile. A clean profile in biotech terms is, does it have any side effects that would limit its usage? And so far, so good. It doesn't have any toxicological findings that would limit the dose. It doesn't have any... Barely any toxicological findings at all, which shows it's a very clean drug potentially in the hands of doctors ultimately as partners want to see that. They wanna see a manufacturing process which delivers eventually a good profit

20:29 margin, and we've been optimizing our own manufacturing process with our partners, PharmMerone, to make sure that's the case. And there's a question, a subsidiary question coming up there, which we'll deal with specifically in a minute.

20:42 What else do they wanna see? Long lived protection, commercial protection for the asset and the patenting work that we've done as part of this manufacturing optimization, which takes us to at least 2046 with the process patent that we've filed in a couple of countries already, is the maximum you can get currently. It's 2026 at the moment. A patent lasts twenty years, before extensions. So it's the longest life you can get. That's an attractive thing to a partner. And finally, indications of effectiveness. Does it

21:15 work in models? Is it likely to work in man through the modeling work we've done in rats and other species? And the answer to that again is yes. We have concrete evidence of binge eating models that the asset, the OX1, is going to be effective in that model. So thanks for turning the tables. I'll sum up now really before we, take some questions. We've made a massive derisking exercise that was announced yesterday, the end of that derisking exercise. And with that derisking comes massive value add to the program. We've taken it essentially from test tube and rat stage through to readiness for permission to give to man. It's a huge, increase in the value of the program. Can't understate to you the progress that this means, and it will eventually be understood, think, by the market.

22:10 We've taken a class leading molecule from lab to man, very soon readiness for man, targeting that approval by year end. We've improved the manufacturing process. We've made an even more attractive partnering prospect. So the next stage now is to establish definitively, not just by modeling, but by clinical trials, what this does in man. And that's something we're working very hard on as you've heard today. I'd like to take this opportunity to thank Helen and the team, though, and our development partners for bringing this program to this point. It's an extremely clever and hard piece of work to deliver, and we've delivered it, or you have, and your team. So thanks for that publicly to you and the team who may well be on the call. I'll turn now to the questions that are submitted and still coming in. There's one presubmitted.

23:04 And, Helen, if I may, I can throw some of these to you during this q and a session. What's the current runway? This is the presubmitted question. What's the current runway, and what are your fundraising plans? We've said in our financial reports, the current runway is to the end of the first quarter, at least the end of thirty first of March twenty twenty seven. Fundraising plans depend on our partnering effort, which we're busily exploring currently and working with partners. So how are we gonna fund the phase one study eventually?

23:36 There are two ways and maybe hybrids between the two. First is a buyer partner, nondilutively. Second is dilutively, and we've always been clear about that. And the third is is some hybrid, some co development model that as is... As yet unknown to us. But rest assured, we're working very hard on each of those potential scenarios. So runway end of quarter one, lots of activity going on below the surface on realizing the fundraising for that phase one study that we know enhances the value of the asset even further. One here about manufacturing. How have the yields improved relative to the original process? And has the process been validated at scale suitable for later stage clinical development?

24:22 Helen, I'll I'll turn to you for that one perhaps. Yeah. So when we began this process,

24:28 the current manufacturing process, we were only able to produce, you know, grams of material. And now we can produce up to... The maximum is just over 10 kilograms, that we did for the twenty eight day study. So, yes, we're able to do that at a scale suitable for late stage clinical development. I mean, we produced two, kilos for the g... Under GLP or GMP, sorry, for the phase one supply that we we have already in the bank. And we know, as I said, that we can get that up to 10 kilos. So as you go through the clinical process, obviously, you need more and more material, but I feel quite confident that we have a process at the moment that will provide sufficient scale.

25:16 Great. And, of course, we've we've already manufactured and announced that we've made clinical human grade material as well in bulk to round off that piece of manufacturing. So one on tox specifically here. Based on what you've seen in the initial tox results, do you anticipate OX1 will cross the blood brain barrier in meaningful amounts in patients? Back to you again, Helen. Yeah. I mean, we have done a lot of work, not just toxicology, but other animal in vivo modeling work. And we know we've got really good blood brain ratios, so good blood brain barrier penetration. We get, you know, definitely efficacious amount of drug over the blood brain barrier, so we have no concerns over that. But, obviously, we want to confirm that within the human population.

26:04 Great. And the next one, also on PK, some good technical questioning coming in here. Based on what you've seen in the initial toxicology results, did you obtain any pharmacokinetic data, PK, how the blood... Body's handling it, that could give you an idea what the dosing frequency might be in humans. And is a once daily tablet, you know, feasible? It says question asked. That would be nice. Yes. So over to you again. I'll it all. So, yeah, at the beginning of this process, we had modeled twice BID, so morning and evening dosing. And we will take that forward into phase one. There might be opportunity for once daily dosing with an optimization of formulation. At the moment, we're just working with a kind of really initial formulation.

26:53 But I I would hope eventually we could get down to a once daily dosing, but we will take forward twice daily at the moment. And I think that then reads... I think this same person has a question about fed and fasted state. So, yes, so... Sorry. I'll read out the full question for everyone else. It's benefit. Will the Aussie study look at both fed and fasted state, or will be or or will it be dose ranging study in the FAST? So we will look at both THERACRYF and FAST, which is usual THERACRYF FAST, sad, mad. Yeah. There's another question here about cash, which I think we've dealt with. You know, the the point about going to the market for money if it's needed outside the partnership is to enhance the asset value even further. So we don't go to the market, you know, and do nothing with it. As you've seen in the last eighteen months, we've gone to the market twice.

27:42 We've raised enough money to do this program and do it well, and the results are speaking for themselves now. In eighteen months since we raised in March 2025, a lot has been done to increase the asset value. And if we need to go again, it will be to increase the asset value in a clinical setting yet further so that the returns we all get as shareholders get ever higher through partnership. That's the point of it. And we've shown it in this program and the top up we did over the summer that we spend the money wisely, and we spend it on good tractable assets. The last question so far is another good one. Thank you. What's the current state of competition for selective or exon one blockers, and has this changed?

28:28 Well, yes. Actually, it's changed a lot, and we'll both deal with that. Maybe, Helen, you could start because I know you keep a very close eye on the competitive environment for this class. Yeah. So a a number of larger farmers had programs in... For orexin, orexin one antagonist specifically, And they fell down for reasons we've mentioned before, and that's really selectivity for the receptor over the receptor two. So you're seeing sedative effects when they got to the clinic. Some of them just didn't have good drug like properties or had toxicology issues, which is why we're really pleased to report out the positive toxicology.

29:07 And over the past one to two years specifically, the remaining active programs, one was individual program reported out actually this year in opioid users that took three doses in. And although it missed its primary endpoint, they reported some interesting findings for the middle dose, so some anxiolytic effects and some fMRI. So that's some imaging study effects.

29:33 That company has been bought now by super... I think it was Supernus was the merger they had, and I don't think they're taking forward that program themselves. The other one was a Cerevance program that was at phase one, and I haven't heard any advancement of that program since. So I think we're probably the most active advancing program at the current time. It's fair to say it... Add to that, the competitive environment's got a bit simpler, for two reasons, really. Firstly, some of the assets that have been paused were suboptimal. They didn't work as well as the originator thought because the profile wasn't good enough. We designed this molecule to be more than good enough. And so far, it's delivered to our design specifications.

30:19 It's called a target product profile. We defined that many years ago, and that the asset continues to perform to the design specifications we set, which were market leading potential. So nothing that we've seen in our OXONE

30:33 program has done anything other than deliver to our relatively high expectations because we know you need good CNS penetration penetration into the brain. The the drug needs to sit on the brain receptor for long enough to exert an effect, and some of the drugs that have been paused didn't do that. So we know we've got the optimal profile. We know the... So far, anyway, the competitive environment is simplifying. We know still that we have the market leading drug or potential drug in this area. So I think that deals with all the questions. Thank you for them. Thanks for listening. We're half an hour in, so a quick run through the impact that our RNS yesterday on our tox program and completion of manufacturing scale up in tox does for you. Alex, I'll hand back to you now, and hopefully, people will tell us what they think in the poll.

31:23 That's great. Brilliant. Thank you guys very much indeed for updating investors today. Could I please ask investors not to close this session? As you know, we'll be automatically redirected to provide you feedback, which will the company better understand your views and expectations. On behalf of the management team, we would like to thank you for attending today's meeting, and good afternoon to you all.