Dr. Robert Foster, CEO

Hepion Pharmaceuticals (NASDAQ:HEPA), which recently changed its name from ContraVir Pharmaceuticals, is developing targeted therapies for liver disease arising from non-alcoholic steatohepatitis (NASH) and chronic hepatitis virus infection (HBV, HCV, HDV). The company is currently testing its lead drug candidate, CRV431, in Phase 1 trials for HBV, and recently received the FDA’s authorization to commence an IND opening study for the treatment of NASH, which complements Hepion’s current IND for the HBV indication. In this interview with BioTuesdays, Dr. Robert Foster discusses NASH, data the company has generated to-date, and its clinical development plans for CRV431.

What is NASH?

NASH is the more severe form of non-alcoholic fatty liver disease, or NAFLD. NAFLD and NASH are major contributors to the development of significant liver disease. Other contributors include alcohol consumption and viral hepatitis. Any of these factors can trigger a series of events that can lead to end-stage liver disease and liver failure, which may be life threatening.

NASH patients typically have fatty livers with inflammation and ballooning – or liver cell degeneration, and fibrosis – or scarring, which results from the deposition of collagens and other molecules into a stiff matrix outside of cells. The amount of fibrosis is the major determinant of disease progression to cirrhosis and hepatocellular carcinoma, the most common form of liver cancer, of which NASH is a leading cause.

Why has this indication been gaining attention?

NASH has been gaining attention because of the rising prevalence of fatty liver disease. Approximately 1-in-4 individuals globally have fatty liver disease, and an estimated 3-5% of the world’s population has NASH.

So, I think more companies are interested in this indication because a treatment could generate life-saving therapies and also create real value for all stakeholders. The fact that there are currently no approved treatments for NASH is driving further interest in this indication, and it is expected that NASH will become the primary reason for liver transplants.

Have improved diagnostics contributed to the interest?

To some degree, yes, as our ability to diagnose NASH has improved, but it’s not nearly as much of a driver as the global epidemic of NAFLD.

Historically, the only way to confirm the presence of NASH was by liver biopsy, and that method is less than perfect. So, the availability of more tools enables less invasive and more accurate diagnoses. These include more sophisticated imaging, series of blood tests and lab panels, and transcriptome and metabolome profiling. These tools are especially important as a large portion of individuals who have NAFLD aren’t aware of it. A common misconception is that NAFLD only occurs in significantly overweight or obese individuals, but there is what is referred to as “lean NASH,” where the disease presents in seemingly healthy individuals.

What is CRV431?

CRV431 is an orally administered cyclophilin inhibitor that we believe will be administered once daily. Cyclophilins are enzymes that catalyze protein folding processes that are important for the three-dimensional configuration of proteins, and in turn, their function. Specifically, cyclophilins regulate folding at one unique protein building block, the amino acid, proline. Many disease processes are characterized by an overproduction of proteins, and therefore disrupting the production of properly folded proteins with CRV431 is one strategy for treating disease.

CRV431 is based on the scaffold of cyclosporine, an immunosuppressive drug that also binds cyclophilins. The major difference between these molecules is that the binding of cyclosporine to calcineurin has been chemically removed in CRV431, so it does not have the immunosuppressive properties of cyclosporine. The cyclosporine scaffold of CRV431 however, has been chemically modified to enhance binding to cyclophilins. These novel chemical modifications are what confer the properties of CRV431, and since cyclosporine has been used commercially in North America since 1983, for a variety of indications, we don’t anticipate any safety issues with CRV431.

How does CRV431 work to reduce fibrosis?

Collagen is the most abundant protein in fibrotic scars, and proline is extremely abundant in collagen. By targeting proline, cyclophilins play a major role in both the amount of collagen produced and the formation of its intricate helical and crosslinked conformations. Therefore, the evidence is quite compelling that CRV431 can reduce fibrosis by blocking the roles of cyclophilins in collagen production and folding.

Additionally, experiments from our laboratory indicate that CRV431 can also change the expression of many genes that contribute to fibrosis. These genes include not only collagen and other building block molecules, but also other enzymes (e.g. lysyl oxidases) that help to construct the fibrotic matrix. Experiments are ongoing to try to understand this second important mode of action of CRV431.

How does CRV431 work as an antiviral?

Many viruses, including HBV and HCV, have “learned” to take advantage of cyclophilins to help them to replicate and evade the immune system. Certain viral proteins bind to cyclophilins to help them fold and function in ways that benefit the viruses. One example is the HBV surface antigen protein, HBsAg, which is produced in extreme quantities by HBV and seems to protect the virus from the immune system. CRV431 blocks the binding of cyclophilin A to HBsAg, which leads to lower HBsAg production in experimental models. It would be exciting to see a similar effect in human HBV patients, as current antiviral treatments largely do not affect HBsAg concentrations in the blood.

Interestingly, CRV431 can also exert anti-HBV activity independent of cyclophilin inhibition by binding directly to a protein called NTCP on the surface of liver cells that acts as an HBV receptor. Therefore, CRV431 has the potential to reduce new infection and re-infection of liver cells by HBV.

Hepion was originally targeting HBV with CRV431. What led to the expansion to the NASH indication?

The ultimate goal of antiviral drug development is to completely eradicate viruses from patients and restore antiviral immunity. However, achieving such a “sterilizing cure” for HBV infection is very complex due to the nature of this very stealthy virus. Commercialized drugs that reduce HBV viremia already exist, but they rarely lead to complete elimination of the virus. CRV431 has shown anti-HBV effects in many experimental models, so it has potential to improve upon existing treatments. Achieving a sterilizing cure still remains a very lofty goal, and one that will be very challenging.

Based on our own experiments on CRV431 and on the scientific knowledge of cyclophilins’ role in HBV infection and fibrosis, we concluded that the likelihood that CRV431 could impact fibrosis, inflammation, and other related disease processes was greater than its complete eradication of HBV. The high prevalence of fibrosis as a disease process means that CRV431 might also hold potential in lung, heart, kidney, or other organ disorders where fibrosis plays a role. The increasing prevalence of NASH was also a contributing factor in our decision to focus on CRV431 as an antifibrotic.

Approximately 250 million people worldwide are chronically infected with HBV, and the risk of developing liver fibrosis and cancer in these individuals remains a significant problem. When fatty liver disease and NASH are overlaid upon the HBV population, the diversity of mechanisms through which CRV431 could benefit patients becomes even greater. Our data generated thus far point to CRV431’s antifibrotic effects as translating to the greatest possible therapeutic and commercial success.

What data has Hepion generated for CRV431 in NASH?

We originally used a STAM NASH mouse model to test CRV431’s ability to decrease NAFLD scores, which consider the extent of inflammation, steatosis and ballooning. We found that treatment with CRV431 earlier in the disease course decreased NAFLD scores. This seems to indicate to us that CRV431, given early, may alter the steatohepatitis, ballooning, and inflammation of the liver. However, the results we saw with fibrosis were even more exciting.

To explore CRV431’s impact on fibrosis, we conducted four separate and independent studies in the same NASH model. We quantified the amount of collagen after treatment with CRV431 and consistently saw a statistically significant decrease in the amount of fibrotic scarring. And, the antifibrotic activity we observed appeared to be quite potent, even when we compared CRV431 to other late clinical stage compounds.

Tell us about the data you collected from two new NASH models.

After we determined that CRV431 consistently performed very well in the NASH animal model, we decided to conduct another study that focused more closely on fibrosis. In this study, we used a completely different inducer of liver fibrosis, carbon tetrachloride, and found CRV431 produced a statistically significant decrease in fibrosis. For comparison, we tested obeticholic acid (OCA), another NASH drug candidate, which did not appear to have any anti-fibrotic effect in this particular model.

Most recently, we tested CRV431 on precision-cut human liver slices, a model that is likely the most applicable to human disease. Here, fibrosis was induced with physiological molecules, TGFβ and PDGFββ, which are known to participate extensively in human fibrotic diseases. We observed that CRV431 also decreased fibrosis in this experimental model, and did so to a greater degree than OCA, as well as another comparator, elafibranor, an NAFLD drug candidate.

What are Hepion’s upcoming development plans for CRV431?

Our near-term plans are to initiate an IND-opening study that will obtain CRV431 pharmacokinetic data from patients with varying degrees of hepatic impairment. We are also planning to launch a 28-day multiple ascending dose study to assess the safety, tolerability and pharmacokinetics of CRV431. This study will be conducted in virally-suppressed HBV patients in which we will also explore markers of HBV infection and liver fibrosis for early signs of efficacy.

How do you envision CRV431 being used in NAFLD and NASH patients?

Currently, NAFLD and NASH treatment is commonly focused on addressing the diseases’ main contributors, such as metabolic disorders and inflammation. We believe that CRV431 may be truly antifibrotic. We will continue to study CRV431 and anticipate that our drug candidate may become an important player in the treatment of NASH, fibrosis, and more broadly speaking, the treatment of liver disease.

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To connect with Hepion, or any of the other companies featured on BioTuesdays, send us an email at editor@biotuesdays.com.

Kenneth L. Waggoner, CEO, President and General Counsel

PharmaCyte Biotech (OTCQB:PMCB) is developing cellular therapies for its lead pancreatic cancer program and for diabetes that are based on a proprietary cellulose-based live cell encapsulation technology known as a Cell-in-a-Box.

“When used for pancreatic cancer treatment, the combination of Cell-in-a-Box encapsulation plus a cancer prodrug, which needs to be converted to its cancer-killing form by the cells in the Cell-in-a-Box capsules, turns out to be a completely unique approach to the treatment of pancreatic cancer,” CEO, president and general counsel, Kenneth L. Waggoner, says in an interview with BioTuesdays.

“In very early clinical trials, this combination produced a strong antitumor effect at the tumor site, with little-to-no treatment-related side effects,” he adds.

Mr. Waggoner explains that to treat pancreatic cancer, PharmaCyte’s platform technology encapsulates genetically modified live cells that are used with a cancer prodrug, ifosfamide. These modified encapsulated cells are implanted in the blood supply as close as possible to the tumor site.

After implantation, ifosfamide is given intravenously at one-third the normal dose, he points out. When the IV ifosfamide reaches the encapsulated cells, it is designed to flow through pores in the capsules, where the genetically modified live cells produce an enzyme that converts ifosfamide into its cancer-killing form, he adds.

Mechanism of Action

Mr. Waggoner contends that the live cells inside the capsule act as a “bio-artificial liver” activating the chemotherapy at the site of the cancer.

“We use the term bio-artificial liver because if the Cell-in-a-Box capsules were not present near the tumor, the inactive prodrug would not be converted into its active form until it passed through the liver,” he says. “Thereafter, the activated ifosfamide, which has a short biological half-life, would be very diluted by the time it reached the pancreatic tumor and the anticancer effectiveness of the ifosfamide would be quite low.”

Mr. Waggoner contends that the implanted capsules do not impede the blood supply to the pancreas and thus to the tumor. This “targeted chemotherapy has proven effective and safe to use in earlier clinical trials, with little to no treatment-related side effects.”

A single implantation consists of 300 Cell-in-a-Box capsules, which are each the size of a head of a pin, Mr. Waggoner says, with each capsule containing approximately 20,000 genetically modified live cells.

Mr. Waggoner points out that a normal dose of ifosfamide has shown success in treating some cancers, including pancreatic cancer, but clinicians are reluctant to use a normal dose because of its severe toxicity.

“If this technology can be solidly proven in the clinic, it will change how certain types of solid tumors are treated for a very long time,” he contends.

COO of PharmaCyte, Gerald W. Crabtree

Gerald W. Crabtree, COO of PharmaCyte, says the Cell-in-a-Box capsules, which are made of bio-inert cellulose (cotton), have been shown to be safe, effective and durable for at least two years in the body. In addition, the pores in the capsules are too small for immune system cells to enter or encapsulated live cells to leave.”

Dr. Crabtree explains that other live cell encapsulation technologies have used alginate, which is derived from seaweed, and alginate derivatives, but many of these tend to produce more of a gel than a capsule. “In addition, alginate-based capsules tend to be far less robust and less stable than our Cell-in-a-Box capsules, and they can’t be frozen for long-term storage or the long-distance shipment.”

Pancreatic cancer is the third leading cause of cancer-related deaths in the western world, with an overall survival rate of 8%. Some 72% of patients will die within the first year of diagnosis and more than 90% will die within two years after diagnosis. Patients have less than six-months average life expectancy after diagnosis without treatment.

In addition, pancreatic cancer is usually not diagnosed until it is advanced and inoperable. However, advances in imaging technologies have enabled the disease to be diagnosed earlier. Still, there is no cure unless the tumor is surgically removed in its earliest stages.

Since the first chemotherapy drug, gemcitabine, was approved by the FDA for pancreatic cancer in 1996, some 40 unsuccessful pivotal trials have been conducted to find a combination therapy to improve on gemcitabine alone, Dr. Crabtree recalls

The current standard of care is a combination of gemcitabine and Abraxane. The FDA approved the combination chemotherapy in 2013. While there are severe side effects associated with gemcitabine plus Abraxane therapy, the combination has increased the percentage of one-year survivors to 38% from 22% with gemcitabine alone.

FOLFIRINOX, a combination of four chemotherapy agents – folinic acid, 5-fluorouracil, irinotecan and oxaliplatin – has been used outside of North America for patients with metastatic and locally advanced pancreatic cancer, and is now used in America in some cases, before surgery to shrink the tumor as much as possible. However, FOLFIRINOX does not have marketing approval and comes with severe side effects.

In the 1990s, a Danish company, Bavarian Nordic, sponsored two small clinical trials in Europe in patients with stage 3 and 4 pancreatic cancer. Although historical data were used as a control in these trials, it was possible to compare the data from patients that had received gemcitabine alone, Dr. Crabtree recalls.

In these trials, an earlier version of the Cell-in-a-Box plus low doses of ifosfamide was used. The Cell-in-a-Box-based therapy was found to be safe, effective and well tolerated by patients. Mr. Waggoner says that in some cases, a patient’s tumor went from inoperable to operable.

PharmaCyte, which licensed the Cell-in-a-Box technology in 2013, is currently finalizing an IND that, if approved by the FDA, would allow PharmaCyte to conduct a Phase 2b trial in the U.S. The trial would be scheduled to start in the first quarter of 2020.

Mr. Waggoner says the company is targeting a critical unmet medical need that exists for patients with advanced pancreatic cancer whose tumors are locally advanced, non-metastatic and inoperable, and no longer respond to Abraxane plus gemcitabine or FOLFIRINOX therapy.

“The goal of the trial is to show that PharmaCyte’s therapy for pancreatic cancer can serve as a consolidation therapy with Abraxane plus gemcitabine or FOLFIRINOX, where no satisfactory consolidation therapy currently exists,” he adds.

The company plans to randomize 100 patients into three groups. Fifty patients will receive PharmaCyte’s pancreatic cancer therapy, while the other 50 will receive capecitabine, a chemotherapy, plus external beam radiation, or stereotactic body radiation alone.

Mr. Waggoner says each patient in the PharmaCyte therapy group will receive a single implantation of 300 Cell-in-a-Box capsules, which will be implanted in the patients’ bodies three days before they begin receiving multiple courses of low-dose ifosfamide. The administration of the ifosfamide will continue until patients become refractory to the drug or their disease progresses.

The primary endpoint of the trial is progression-free survival. Among secondary endpoints are overall survival; objective response rate, complete and partial responses; and determining the number of patients whose tumors are converted from an inoperable state to an operable one post-treatment, he adds.

Three internationally renowned pancreatic cancer oncologists – Dr. Daniel Von Hoff, Dr. Manuel Hidalgo and Dr. Matthias Löhr - played leading roles in identifying and designing the Phase 2b trial.

Dr. Von Hoff has been a leading figure in the development of cancer drugs for many years; and Dr. Löhr was the principal investigator (PI) of the earlier Phase 1/2 trials and is currently chairman of PharmaCyte’s medical and scientific advisory board. Dr. Hidalgo is the PI for the company’s upcoming Phase 2b study.

PharmaCyte has partnered with Austrianova Singapore Pte. to manufacture the Cell-in-a-Box clinical trial material at its cGMP manufacturing facility in Bangkok, Thailand. “Production is being validated on an ongoing basis, and we expect release of clinical trial material in the U.S. during the fourth quarter of 2019,” Mr. Waggoner offers.

PharmaCyte has orphan drug designation for its pancreatic cancer therapy in the U.S. and Europe. It also has eligibility under the Biologics Price Competition and Innovation Act, which provides 12 years of market exclusivity in the U.S. and Europe.

PharmaCyte’s patent portfolio includes the encapsulation process, which uses unique patent-protected cellulose sulphate and is a pivotal ingredient in the formation of the Cell-in-a-Box capsules; patents protecting genetically engineered cells that convert a cancer prodrug into its active form; as well as Melligen insulin-producing cells that may be a pivotal part of the company’s diabetes program.

The company’s therapy for Type 1 diabetes and insulin-dependent Type 2 diabetes, though still in the preclinical stage, involves encapsulating genetically modified liver cells that are called Melligen cells. PharmaCyte also will be examining the use of stem cells and beta islet cells that have been encapsulated using the Cell-in-a-Box technology and then implanting these capsules in the body.

Mr. Waggoner explains that Melligen cells are human liver cells that have been modified to produce, store and release insulin in response to concentrations of glucose in the body. In addition, Melligen cells have demonstrated the ability to reverse the diabetic condition in immunosuppressed diabetic mice.

PharmaCyte has an exclusive worldwide license to use Melligen insulin-producing cells to treat diabetes.

“In a way that is analogous to how Cell-in-a-Box capsules protect the cells from immune system attack in the body when they are used as part of a pancreatic cancer treatment, they should do the same thing for insulin-producing cells,” Mr. Waggoner says. “These types of cells are designed to function as a bio-artificial pancreas for purposes of insulin production.”

Pipeline

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To connect with PharmaCyte, or any of the other companies featured on BioTuesdays, send us an email at editor@biotuesdays.com.

Derek Archila

As a director and senior analyst covering the biotechnology sector at Stifel, Derek Archila combines analytic ability and industry experience. He has held executive positions covering biotechnology and specialty pharmaceuticals at Oppenheimer and Leerink. He also had a stint at GlobalData, a healthcare research and consulting firm, where he was responsible for building the medical technology research and consulting team. And he spent five years in the clinical hematology/immunology laboratory at Brigham & Women's Hospital as a senior medical technologist. At Stifel, where his coverage focuses on autoimmune, inflammatory and cardiovascular and metabolic diseases, Mr. Archila now has become a leading authority on non-alcoholic fatty liver disease and NASH, or nonalcoholic steatohepatitis, an emerging indication with major unmet medical needs. In this interview with BioTuesdays, Mr. Archila discusses the diagnosis of NASH, current approaches to disease management, NASH therapies in development and how investors should approach the sector.

Let’s begin with a brief overview of NASH.

Fatty liver disease is simply an accumulation of fat in the liver resulting from diet and is highly associated with other conditions such as diabetes, cardiovascular disease and obesity. Some metabolic syndromes drive the generation of fat into the liver, causing nonalcoholic fatty liver disease (NAFLD), which encompasses the entire spectrum of fatty liver disease in individuals without significant alcohol consumption, ranging from fatty liver to NASH and cirrhosis. However, the category from a pharma and biotech perspective is still in its infancy and many of the clinical and commercial variables still are not fully understood.

Bulk And Histological Features Of The Liver Across The NAFLD Spectrum

What’s the U.S. prevalence of fatty liver disease?

Due to the pandemic spread of obesity, the U.S. prevalence of NAFLD is a shocking 30%. While only a proportion of these patients will progress to NASH and an even smaller proportion to liver failure and transplant, there is no doubt this is a large market opportunity. And with no approved therapy, the unmet need is real, particularly in the most advanced patients.

How do you bridge this divide?

A high degree of education will be needed over the course of the next couple of years because NASH awareness in the general population is very low. Let's not forget that the NASH patient population is generally asymptomatic, notoriously non-compliant with lifestyle modifications, such as diet and exercise and with their medications, and may not be the easiest to get on and keep on treatment. From the literature, we know that a NASH patient is four-to-five times more likely to die from a cardiovascular event than from a liver event.

Can NAFLD and NASH be diagnosed?

NAFLD is called a silent disease because patients are largely asymptomatic and the disease can manifest as non-specific symptoms like right upper quadrant pain or fatigue. We think high-risk patients are easier to identify because NAFLD overlaps with other easily diagnosed indications, such as diabetes, obesity, and dyslipidemia, or elevated lipids in the blood. The best diagnosis requires an expensive, burdensome, and risky liver biopsy. But the costs are just too high to screen the millions of patients at risk of NASH with biopsies. Instead, we think better diagnostics and/or biomarkers are needed to enable payers to support more expensive therapies with confirmed diagnoses for reimbursement purposes, as well as to monitor disease progression or regression.

What’s the current state of disease management?

Since there is no approved therapy for NASH, management and interventions are focused on lifestyle changes and management of comorbidities where there are approved therapies. All patients are urged to lose weight, abstain from alcohol and receive hepatitis immunizations. Losing more than 5% of bodyweight can improve steatosis while bodyweight loss of more than 7% can improve fatty liver disease. And MRI liver fat studies have shown that a 5% decrease in body mass index can yield a 25% reduction in liver fat. Some patients will ultimately require more significant interventions, such as bariatric surgery, which has the potential to resolve NASH and reverse fibrosis. For patients with biopsy-proven NASH, the American Association for the Study of Liver Diseases recommends use of Vitamin E to improve liver histology. KOLs have indicated to us that pioglitazone can be used as well, but there are safety concerns that limit its use. Otherwise, pharmacologic interventions are limited to fatty liver comorbidities: GLP-1s in diabetes, statins for hyperlipidemia, and omega-3 fatty acids for hypertriglyceridemia.

What’s a key hurdle in developing a treatment for NASH?

We ultimately view NASH as the liver manifestation of metabolic syndrome, not a liver specific disease. As a result, we see the emergence of two distinct markets in NASH: therapies that address metabolic syndrome and reduce liver fat, preventing the insult to the liver that drives downstream fibrosis, and therapies that may only reverse fibrosis with no impact on the metabolic components of the disease. We expect therapies that improve the metabolic syndrome associated with NASH to garner the most up-take since they are likely to confer a benefit beyond just treating NASH, such as improving cardiovascular outcomes, which we think will resonate with payers. Yet, reversing fibrosis in the most advanced NASH patients remains a challenge since these patients tend to have the worst outcomes. In addition, we believe combination therapy is highly likely in NASH, and we expect data to continue to emerge in the coming years for synergistic mechanisms that could confer benefits on both the metabolic and fibrosis components of the disease.

How are drug developers approaching NASH?

There are lots of hypotheses out there about the pathophysiology of NASH. What we do know is that liver fat drives inflammation, which drives fibrosis. But the insult to the body that facilitates this cascade remains a mystery. That’s why we see drug developers studying many mechanisms of action that could impact disease progression.

Do you see M&A activity in the sector?

While the buzz of potential M&A in the NASH category is a frequent topic among investors, we are less optimistic this will materialize in the near-term. There are many Big Pharma and biotech companies with their own programs and we believe companies without specific programs will likely be patient in order to watch the NASH category unfold.

What’s going to be the first drug approved for NASH?

Intercept Pharmaceuticals (NASDAQ:ICPT) received approval for Ocaliva in an orphan liver disease called primary biliary cholangitis and earlier this year, the drug scored the first positive Phase 3 result in NASH. However, we are not optimistic about Ocaliva’s commercial viability in NASH, given what we view as a less that desired safety profile and marginal efficacy for a disease that takes a long time to progress. Based on current data, we also question the commercial viability of Genfit’s (NASDAQ:GNFT) drug candidate, elafibranor, if it only demonstrates a marginal benefit on NASH resolution. Elafibranor’s Phase 3 results are due in the fourth quarter of 2019.

Are there any early-stage companies you like?

There are a lot of early-stage programs out there but one to watch is NGM Pharmaceuticals (NASDAQ:NGM). It has a daily injectable drug candidate with compelling Phase 2 data, demonstrating a dramatic reduction in liver fat, the best we’ve seen so far, along with an improvement in fibrosis in a 12-week study, which is very impressive. We are also bullish on companies developing FGF21 [fibroblast growth factor 21] analogs, such as Akero Therapeutics (NASDAQ:AKRO) and closely-held 89bio, given this class’ emerging efficacy profile.

How should investors approach the space?

We think it’s way too early to declare a winner in the NASH category and we believe treatments that improve the underlying metabolic syndrome that is highly associated with NASH will be the treatments that dominate. Plus, there are a lot of private companies that will go public in the years ahead, so there will be no shortage of investment ideas. While we’re bullish on the category long-term, we think for now, investors should approach investing in the space in a more tactical manner, given the numerous regulatory and commercial questions that remain unanswered, making this very much an event-driven, stock picker's category.

Michael Freeman, Founder and President

California-based Ocutrx Vision Technologies has developed an augmented reality (AR) headset that helps age-related macular degeneration (AMD) patients overcome severe and devastating vision loss.

Usually occurring on both eyes, AMD is caused by damage to the macula, the 1.5 mm wide, oval-shaped functional center of the retina that is responsible for detailed central vision. In the earlier stages of disease, central vision is reduced, and overall vision distorted. As the disease progresses, all central vision may be lost.

“It's very frustrating. A lot of people give up reading, they become clinically depressed and withdrawn because they can't read or see people's faces,” Michael Freeman, Ocutrx’s founder and president, says in an interview with BioTuesdays.

According to Mr. Freeman, there are 13 million people in the U.S. with advanced AMD, and by 2050, that number is expected to increase to 22 million, affecting some 288 million people worldwide.

“We’re developing the first computer-mediated reality glasses to provide functional vision for people with irreversible vision deficits,” he says, adding that the headset, called Oculenz, was a long time in the making.

Imagine… this was your view of the outside world

“My father was a brigadier general in the U.S. Air Force, and also an entrepreneur. When I was a kid, he bought a computer company, so we grew up building computers. I was working for my dad in the 1990s and we were one of the largest suppliers of computer products in California. I was always trying to tell the technicians, over the phone, what to do to fix computer issues, and I thought ‘if only I could send video over the cell phone, I can show you what I'm talking about,’” he recalls.

The idea led Mr. Freeman to build the first-ever device that enabled streaming mobile video. The invention proved revolutionary: Mr. Freeman won two Emmy awards in 1994 for developing the technology, which continues to be used today to send videos between smartphones.

Then, nearly two decades later, Mr. Freeman’s father was diagnosed with AMD. “He got this disease and had to quit flying and driving. He got us to the Sunday dinner table and said, ‘we invented mobile video and revolutionized the world with that. We know enough about video to figure out some way to work-around this disease,’” he recounts.

Mr. Freeman says the breakthrough came when he bought his father a curved television, a novelty in 2013. He noticed that when his father approached the curved television, he could see more of the image because more visual information was moved to his peripheral vision, which was still functional.

He began working on a headset that incorporated eye tracking and visual field assessment functions to map the defects in the eyes. He then began developing algorithms to alter the image taken by cameras on the headset, to be displayed in the user’s peripheral field of vision.

Mr. Freeman explains that, “The Oculenz takes streaming video of the real world and, within five milliseconds, it alters that image, so text is moved to the left and to the right of the defect, for reading purposes, and images are moved out 360-degrees around the defect, for doing tasks or recognizing faces.” He adds that when using the headset, the brain begins to ignore the visual defect in the image, much the same as it does with the eye’s natural blind spots.

When Mr. Freeman tested the headset on his father, “he was able to read, see faces again and ride the lawn mower. So, he said ‘let's do this for everybody.’”

Since founding Ocutrx in 2015, the company has collaborated with Karten Design, an award-winning company based in Los Angeles, and Thundercomm, a division of Qualcomm and developer of circuit boards and robotics, to develop the Oculenz prototype.

Mr. Freeman points out that most competitors use waveguide technology, where each pixel in the image and the display are connected by an optical fiber. Using this technology, increasing the headset’s resolution means adding more optical fibers to the already bulky headband, which emits heat and can bring the weight of the headset to more than a pound. The waveguide technology also requires that most ambient light is blocked, so headsets often enclose the eyes and significantly block peripheral vision.

The Oculenz, however, features four million pixels, clear lenses and weighs only 200 grams.

“We believe the Oculenz is best-in-class because it’s the lightest weight, and offers a 120-degree field view, the widest available of comparable products available. It provides the least obstructed vision and the highest resolution; Oculenz has 60 pixels per degree, which is the highest resolution the eye can see at 20/20,” Mr. Freeman contends.

Ocutrx earned Start-Up City Magazine’s recognition as one of the 15 most promising wearable technology start-ups in 2018, and again in 2019. To date, Ocutrx has been granted two patents covering the technology, with seven patents pending, and expects to receive some 30-to-40 additional patents, based on applications they have, and plan to file.

Ocutrx recently completed a pre-pilot clinical trial in AMD patients with 20/200 or poorer vision, some of which had not been able to read for years. In a single visit, patients were provided with headset training, tests of visual function and a self-calibration module to map their area of vision loss.

When using the Oculenz glasses, subjects’ best-corrected visual acuity improved to 20/63, with all subjects able to read 30-point font at a standard reading pace, and some reading text as small as 12-points.

Currently, Ocutrx’s team is optimizing the Oculenz prototype for commercialization. “We’re shrinking everything down to make it quite a bit smaller, from displays of about four-by-four inches wide to displays an eighth the size of a postage stamp,” Mr. Freeman explains, saying Ocutrx is targeting commercial launch for the AMD indication in less than two years.

Ocutrx plans to sell the Oculenz for $6,000, targeting the top low-vision centres and retinal surgeons in major urban areas. Mr. Freeman notes that for the AMD indication, the Oculenz is a generic FDA class I device and 510(k) exempt, therefore it doesn’t require regulatory approval ahead of product sales.

The company is also developing the Oculenz for surgical applications and amblyopia, both applications for which regulatory approval would be required prior to commercialization.

Commonly known as lazy eye, amblyopia affects some 9 million children and adolescents in the U.S. Pediatricians or pediatric ophthalmologists can use the Oculenz’s embedded eye-tracking to generate a report of a patient’s eye movements. This can be used to design custom exercise programs to strengthen the weak eye, while the Oculenz headset “frosts” the dominant eye using dynamic opacity. During therapy, Oculenz generates daily reports of the lazy eye’s rotation that can help experts determine a more exacting course of treatment.

Ocutrx state-of-the-art for children with lazy eye

Moreover, the Oculenz includes features that can assist patients with other forms of visual impairment, such as those caused by cataracts and glaucoma.

Ocutrx has incorporated simultaneous localization and mapping, or SLAM, technology into the Oculenz. SLAM, the same technology that is used in autonomous cars, uses sensors to identify and map nearby objects, so the headset can help wearers navigate their surroundings. For example, once the headset has mapped the patient’s home, the voice feature can audibly guide the patient throughout their house, alerting of obstacles to avoid.

The device’s wi-fi and bluetooth capabilities, along with optional cellular connectivity, not only provide similar functionality as a mobile phone, but also enable real-time monitoring. Should the Oculenz detect any changes to an AMD patient’s visual field, or any other changes of concern, the information can be sent to the physician for review. Mr. Freeman says that in the U.S., Medicare and Medicaid will reimburse for this particular monitoring – under particular current procedural terminology, or CPT, codes – to ensure patients are closely monitored while in their own homes.

As for Oculenz’s other applications, the possibilities are endless. “The global augmented reality market will be worth $133-billion in a couple of years, and we’ll be there to provide what everybody is expecting,” says Mr. Freeman.

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To connect with Ocutrx, or any of the other companies featured on BioTuesdays, send us an email at editor@biotuesdays.com.

Philippe Deschamps, Chairman, President and CEO

Helius Medical Technologies (NASDAQ:HSDT; TSX:HSM) is transitioning from a development- to commercial-stage company as it rolls out its Health Canada-cleared PoNS medical device for the treatment of chronic balance deficit due to mild-to-moderate traumatic brain injury (mmTBI), in conjunction with physical therapy.

“Our PoNS (Portable Neuromodulation Stimulator) represents a first mover advantage, with demonstrated safety and efficacy, in a market with few viable options,” Philippe Deschamps, chairman, president and CEO, says in an interview with BioTuesdays.

“After an initial medical event, very often a car accident, TBI can present significant long-term disabilities and challenges to the individual, family, and society,” Mr. Deschamps points out. “After an initial course of physical therapy, the standard of care, patients very often plateau in their recovery and thereafter, are disabled to some extent for the rest if their lives.”

In mmTBI, about two-thirds of individuals will recover spontaneously in two-to-three months from a mild-to-moderate concussion, for example. But some 30% of patients will have a chronic disability, such as chronic balance deficit. When physical therapy ends for this group, they tend to lose whatever recovery has been achieved and drift back to their original state of disability, he says.

Mr. Deschamps explains that PoNS is designed to stimulate the brain’s ability to heal from trauma, in conjunction with physical or cognitive therapy, by enhancing a process known as neuroplasticity.

A mild-to-moderate TBI damages part of the brain, reducing the ability of its neural impulses to communicate clearly with the body. He says that to restore balance and function, the brain needs to be “rewired” to work around the damaged area and reestablish neural impulses to the body.

“This rewiring is called neuroplasticity and we think we achieve this change by neuromodulation,” he adds.

Tongue Based Neuromodulation

Mr. Deschamps contends that PoNS gently stimulates the trigeminal and facial nerves by stimulating the tongue with a small electrical charge to activate neuroplasticity in the brain, unlocking its ability to restore lost function. “We are a neurotech company in the medical device industry focused on neurological wellness.”

The PoNS device

In its long-term clinical treatment study, Helius achieved significant and sustained improvement in patients who had plateaued in their recovery after physical rehab and who had an average Sensory Organization Test (SOT) score of 40, which is profoundly disabled, Mr. Deschamps says. A normal balance SOT score is 70-to-80.

“When we looked at the literature, we determined that the maximum benefit from physical therapy alone was a SOT score improvement of 10-to-13 points and that further spontaneous recovery was unlikely,” he recalls.

In Helius’ TBI registration trial, 71.6% of subjects responded to PoNS treatment and physical therapy, and 53.7% achieved a normal range for balance. “Patients in the trial had an average 27-point improvement in their SOT score, a faster and more robust change than had ever been seen in the literature for physical therapy alone,” Mr. Deschamps says.

Helius used the trial data to obtain Health Canada clearance in October 2018 and treated its first patient in March. The company also submitted a CE Mark application in December and hopes to receive European clearance later this year. In May, Helius filed for approval with the Therapeutic Goods Administration in Australia.

However, the FDA denied the company’s request for a de novo classification and 510(k) clearance of PoNS in April, citing an inability to ascertain the relative independent contributions of physical therapy and the PoNS device to the observed improvements in the balance of the company’s trial participants.

At the same time, the FDA acknowledged that there were no device-related serious adverse events in either of the company’s two clinical trials.

Mr. Deschamps says Helius recognizes the importance of generating new clinical data demonstrating the independent contribution of physical therapy alone in its treatment protocol in order to demonstrate the overall impact of PoNS on participants.

As a result, Helius proactively decided to initiate a study to generate the physical therapy alone data, he adds. The new study protocol will use the same design as the TBI 001 study, including a five-week treatment period and the same inclusion and exclusion requirements. Helius also has identified clinical sites for the study and expects to begin enrolling participants by the end of July 2019.

“We remain committed to generating data to pursue FDA clearance of our PoNS device in order to bring this innovative therapy to more than 1.5 million Americans suffering from chronic balance deficit due to mmTBI,” Mr. Deschamps says.

The company’s methods of use patents extend until 2028, while utility and design patents run until 2035. “We believe this represents a significant barrier to competitor entry,” he suggests.

According to Helius, there are more than 350,000 people in Canada with chronic balance deficit caused by mmTBI, representing a large initial market.

Last October, Helius formed a joint venture with HealthTech Connex to form a new operating entity, called Heuro Canada, to develop and manage neuroplasticity clinics in Canada for the PoNS treatment.

The venture opened two original clinics in Montreal and Surrey, British Columbia and is adding three clinics in Toronto, Calgary and Ottawa during the second half of 2019. The five clinics represent major metropolitan areas that cover more than 50% of Canada’s population.

For all of 2019, Helius is guiding for revenue in a range of $1.6-million to $2-million (U.S.) based on its two founding clinics in Canada. The company expects to generate revenue of about $18,000 (Canadian) per device delivered to the Canadian clinics in 2019.

“We are initially targeting patient segments that are cash pay and workers compensation plans via direct-to-patient digital campaigns and partnerships with patient advocacy groups,” Mr. Deschamps says.

Helius also is engaging with key opinion leaders and professional societies to reinforce the scientific basis for PoNS; incorporate PoNS into Canadian health system guidelines; and pave the way for reimbursement from commercial and government payers.

Regarding its pipeline, Mr. Deschamps says Helius has generated pilot data in patients with multiple sclerosis and stroke, and registry data in cerebral palsy, which “represent other potential indications for PoNS.” Further down the road, the company sees a potential for PoNS to treat people with post-traumatic stress disorder, facial nerve palsy, depression and Parkinson’s disease.

“With our non-invasive PoNS platform, we remain committed to expanding treatment options for patients by amplifying the brain’s ability to heal itself,” he adds.

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To connect with Helius, or any of the other companies featured on BioTuesdays, send us an email at editor@biotuesdays.com.