Cereno Sci­en­tif­ic is dri­ving a new par­a­digm of throm­bo­sis pre­ven­tion with­out as­so­ci­at­ed bleed­ing-risks

Cereno Sci­en­tif­ic is cur­rent­ly in the clin­i­cal phase of de­vel­op­ing a new drug with the po­ten­tial to re­de­fine throm­bo­sis pre­ven­tion with­out caus­ing an in­creased risk of bleed­ing. This is wide­ly known as the ‘holy grail’ of an­ti­co­ag­u­la­tion ther­a­py and has his­tor­i­cal­ly caused sig­nif­i­cant com­mo­tion in the in­vest­ment and Big Phar­ma com­mu­ni­ty. To­day, all mar­ket­ed treat­ments are lim­it­ed by the bleed­ing side-ef­fects that they cause. Pre­ven­tive treat­ments present­ly on the mar­ket (e.g. War­farin; non-vi­t­a­min K oral an­ti­co­ag­u­lants or NOACs) act di­rect­ly by in­ter­ven­ing in the co­ag­u­la­tion cas­cade, while Cereno Sci­en­tif­ic’s can­di­date CS1 is aimed at pre­vent­ing throm­bo­sis by strength­en­ing the body’s own de­fense against blood clots, as it strikes a bal­ance be­tween the clot­ting and the an­ti-co­ag­u­lant fac­tors.

This bal­ance is key not on­ly for pre­vent­ing blood clots from form­ing, but al­so for man­ag­ing ex­ces­sive bleed­ing, which is a ma­jor side ef­fect of treat­ments cur­rent­ly on the mar­ket. This would make CS1 a safer and more ef­fec­tive treat­ment over­all. Fur­ther­more, Cereno Sci­en­tif­ic be­lieves that the unique mech­a­nism of ac­tion of its can­di­date could make it a valid treat­ment for pa­tients who are al­ready tak­ing oth­er an­ti-co­ag­u­lant drugs, mean­ing that CS1 has the po­ten­tial to reach a larg­er pa­tient group com­pared to NOACs or War­farin, thus in­creas­ing its mar­ket po­ten­tial.

Sten R. Sörensen, CEO, Cereno Sci­en­tif­ic

The ac­tive in­gre­di­ent in CS1 is val­proic acid (VPA), which has long been used, at a high­er dose than CS1, in the treat­ment of epilep­sy and has a well-doc­u­ment­ed safe­ty pro­file in hu­mans. This arms Cereno Sci­en­tif­ic with a sol­id foun­da­tion for the prod­uct’s ex­pect­ed safe­ty pro­file, while re­duc­ing the risk of safe­ty be­ing an ob­sta­cle stand­ing in be­tween CS1 and a mar­ket ap­proval. Mar­ket un­cer­tain­ties about CS1 are thus more re­lat­ed to ef­fi­ca­cy. An epi­demi­o­log­i­cal study pub­lished in 2011 showed a strong as­so­ci­a­tion be­tween VPA treat­ment and the re­duced risk of my­ocar­dial in­farc­tion, in more than 100 000 pa­tients, which ex­plains why Cereno Sci­en­tif­ic has a keen in­ter­est in this com­pound. In ad­di­tion, there is in vi­vo da­ta from an­i­mals sup­port­ing the com­pa­ny’s an­ti­co­ag­u­la­tion the­o­ry of VPA. Over­all, this is a good ba­sis for Cereno’s prod­uct strat­e­gy, which will in­volve low drug de­vel­op­ment risks com­pared with a new class of sub­stances, there­by en­abling a faster route-to-mar­ket.

In­deed, the com­pa­ny has been mov­ing for­ward quick­ly with CS1: a phase I study show­ing pos­i­tive da­ta was com­plet­ed in June of this year, and a phase II study has been planned and is set to be­gin dur­ing the sec­ond half of 2019, with re­sults ex­pect­ed to come in 2020. The tri­als will be per­formed by the OCT Group, which have re­cent­ly signed an agree­ment with Cereno Sci­en­tif­ic. Pa­tients from 20 clin­ics through­out Rus­sia and Bul­gar­ia who have un­der­gone or­thopaedic surgery, which in­creas­es the risk of de­vel­op­ing blood clots, are ex­pect­ed to par­tic­i­pate in the study.

Cereno is fol­low­ing a reg­u­la­to­ry path with high re­sem­blance to cur­rent mar­ket lead­ers, such as Xarel­to and Eliquis. In essence, this in­volves achiev­ing a clin­i­cal proof of con­cept in a small and well-de­fined pa­tient pop­u­la­tion be­fore ad­dress­ing the larg­er pop­u­la­tion that has made these two prod­ucts in­to block­busters. The choice of pre­vent­ing throm­bo­sis in the deep veins of the legs and in the lungs of pa­tients un­der­go­ing planned or­thopaedic surgery as study pop­u­la­tion for the phase II tri­als is con­sid­ered very cost ef­fec­tive. Not on­ly does this strat­e­gy al­low CS1 to reach a sta­tis­ti­cal sig­nif­i­cance based on a small­er num­ber of pa­tients com­pared to an in­di­ca­tion like stroke or my­ocar­dial in­farc­tion, it al­so short­ens the re­quired fol­low-up study pe­ri­od, thus short­en­ing the to­tal time­line while low­er­ing over­all costs.

In ef­fect, this pro­vides a good ba­sis for its reg­u­la­to­ry strat­e­gy, which in­volves CS1 achiev­ing mar­ket ap­proval for ve­nous throm­boem­bolism (VTE) first. This en­ables Cereno Sci­en­tif­ic to fo­cus on widen­ing its mar­ket ei­ther as a se­quen­tial or a par­al­lel track with the in­tent to in­clude pre­ven­tive treat­ment for stroke and my­ocar­dial in­farc­tion on the same prod­uct la­bel. This re­flects the paths tak­en by oth­er an­ti-co­ag­u­lant sell­ers in terms of reg­u­la­to­ry strat­e­gy.

The mar­ket po­ten­tial for CS1 is sig­nif­i­cant. Ac­cord­ing to IMS Health, throm­bo­sis pre­ven­ta­tive drugs were worth an es­ti­mat­ed 23,5 BUSD in 2013, and this num­ber is ex­pect­ed to in­crease to 25,9 BUSD in 2018. This gives Cereno a sol­id ba­sis for its fu­ture sales prospects. More­over, a patent for CS1 was re­cent­ly ap­proved in the US, thus in­creas­ing the can­di­date’s fu­ture com­mer­cial­i­sa­tion pos­si­bil­i­ties as the US con­sti­tutes al­most half of the glob­al mar­ket. Not to men­tion, Chi­na is al­so ex­pect­ed to be a main mar­ket for an­ti­co­ag­u­lant drugs as the sales in the coun­try ex­ceed­ed 12,4 BUSD in 2014 and are ex­pect­ed to grow even fur­ther. In ad­di­tion, there is cur­rent­ly an en­dem­ic un­der­use of an­ti­co­ag­u­lant ther­a­pies in Chi­na be­cause of a fear among physi­cians to in­crease the risk of caus­ing bleed­ing. This both in­di­cates that the Chi­nese mar­ket has tremen­dous growth po­ten­tial and that an agent with­out the as­so­ci­at­ed bleed­ing risk may ad­dress an un­met clin­i­cal need per­ceived as high­ly im­por­tant.

The most sig­nif­i­cant chal­lenge fac­ing the com­pa­ny at this point is ac­tu­al­ly its de­clin­ing stock price. Cereno Sci­en­tif­ic signed a con­vert­ible loan agree­ment worth 82-106 MSEK with the Eu­ro­pean High Growth Op­por­tu­ni­ties Se­cu­ri­ti­za­tion Fund (EHGO) in April of this year. While the agree­ment se­cured fi­nanc­ing for the up­com­ing phase II study, Cereno’s stock price has fall­en by just over a third thanks to EHGO sell­ing its con­vert­ed shares, a phe­nom­e­non com­mon­ly re­ferred to as death spi­ral fi­nanc­ing.

This move has put Cereno’s mar­ket cap at a mere 40 MSEK, or ap­prox­i­mate­ly 4.5 mil­lion USD, which is like­ly a sig­nif­i­cant un­der­es­ti­ma­tion con­sid­er­ing the multi­bil­lion-dol­lar mar­ket po­ten­tial and CS1’s cur­rent phase of clin­i­cal de­vel­op­ment. This could of course be seen as good news for any par­ty in­ter­est­ed in in­vest­ing or ac­quir­ing Cereno Sci­en­tif­ic. A quick glance on deal val­ues and val­u­a­tions of in­vest­ment rounds in the same space, as Cereno Sci­en­tif­ic, in­di­cates that a 4.5 mil­lion USD mar­ket cap may be a tem­po­rary anom­aly. In fact, in­vestors will prob­a­bly take note of the fact that if Cereno Sci­en­tif­ic should get a pos­i­tive da­ta read­out from its phase II tri­als, the like­li­hood of strik­ing a sig­nif­i­cant part­ner­ship deal will in­crease sub­stan­tial­ly, thus bring­ing a lot of at­ten­tion to the com­pa­ny and in­creas­ing its val­ue.

Over­all, while Cereno Sci­en­tif­ic in­deed faces a num­ber of chal­lenges and risks re­lat­ed to com­mu­ni­cat­ing its val­ue to share­hold­ers and ap­ply­ing for and achiev­ing sta­tis­ti­cal sig­nif­i­cance in its up­com­ing phase II study, the com­pa­ny has a sol­id sci­en­tif­ic base and has se­cured fi­nanc­ing from which to move for­ward with con­fi­dence. First­ly, CS1 is based on an al­ready ap­proved ac­tive com­pound with a strong safe­ty pro­file that could pos­si­bly en­able it to quick­ly en­ter the mar­ket; sec­ond­ly, the col­lab­o­ra­tion with OCT Group adds im­por­tant knowl­edge and ex­pe­ri­ence which will prove use­ful in the up­com­ing phase II study; third­ly, Cereno has es­tab­lished a patent es­tate around its pro­pri­etary for­mu­la­tion and the med­ical use of VPA that en­sures sub­stan­tial ex­clu­siv­i­ty on the mar­ket.

If CS1 can come out of the phase II tri­als with pos­i­tive re­sults, it has the po­ten­tial to low­er costs, im­prove health and gen­er­ate sig­nif­i­cant health-eco­nom­ic ben­e­fits, thus be­com­ing a First-in-Class drug rep­re­sent­ing a par­a­digm shift for throm­bo­sis pre­ven­tion. This could make it a dom­i­nant treat­ment, in health-eco­nom­ics terms, when com­pared to avail­able treat­ment al­ter­na­tives, see­ing that the al­ter­na­tives would no longer be eco­nom­i­cal­ly jus­ti­fied. With such po­ten­tial, CS1 has high prospects of achiev­ing a sig­nif­i­cant share of the mar­ket.

A full sta­tus re­port on Cereno Sci­en­tif­ic can be viewed here.

Im­age: Cereno Sci­en­tif­ic team