David Thompson Presents Osteal Therapeutics at LSI Europe '23

Osteal Therapeutics is a musculoskeletal therapeutics company developing solutions for the treatment of orthopedic infections.
David Thompson
David Thompson
CEO, Osteal Therapeutics



David Thompson  0:06  
Appreciate the introduction. As I mentioned, I'm David Thompson. I'm the president and CEO of Osteal Therapeutics. I'm a bit of the odd man out here at this conference because Osteal technically is a drug company that we develop combination therapies were regulated as a drug. Osteal is developing a combination drug device therapy platform for treating orthopedic infections and addressing the high morbidity, mortality and cost of care of dealing with these patients. So let's talk about what the fundamental issue here is here. So anytime we put an orthopedic implant into the human body, the metal the poly and the surrounding tissue become vulnerable to formation of biofilms. And biofilms are these complex poly microbial structures where bacteria hide under these matrices, and effectively isolate themselves from the immune system from systemic antibiotics. And ultimately, because of the protection these biofilms afford standard minimum inhibitory concentrations of antibiotics are insufficient to treat these, these infections. And we need to raise those concentrations up to what's called the m back the minimum biofilm eradication concentration. Now these infections present themselves in three major categories, orthopedic reconstruction, so Periprosthetic joint infections, that's the largest one spine and plant infections and trauma implants. PGI Periprosthetic joint infection that's the largest category is a killer. So this is a cancer like diagnosis in which a patient with a PGI has a survived five year survival rate effectively of a breast cancer patient. So one in four of these patients are not going to survive the first five years after their diagnosis. And the treatment that they are offered isn't long, arduous, ineffective therapy called to stage exchange arthroplasty. So these patients are going to go in, the surgeon is going to remove their infected prosthesis, replace it with an antibiotic loaded bone, cement spacer. These are minimally functional implants that allow sort of some basic ambulation, but are very limiting in what they allow a patient to do. That patient then is going to go for six weeks plus of IV antibiotics. And then if they're lucky, they're going to come back in about week 16 And get reimplanted with a new joint. Sadly, the 16 week patients are the lucky ones. Half of the patients, particularly those over 65, are not ever going to get their new joint. And for those patients that retain their spacers. They are exposed to increased mortality, the potential for amputation, and even further loss of mobility as their functional status declines. The reason why the standard of care doesn't work is that relying on primarily systemic antibiotics that reach minimum inhibitory concentrations, but not M back means that these patients ultimately because it can't achieve them back. They can't resolve these infections. And so the other challenge is, is that as you look at trying to increase concentrations at the site of infection through systemic delivery, you run into the issue that these antibiotics are both nephrotoxic and ototoxic. So in about 20% of the patients, they're going to end up with an AKI instead of actually getting result resolution of their infection. So the answer to this is what ostial has developed is a novel route of administration called cyclic local antibiotic irrigation. And what it allows us to do is place high concentrations of antibiotics directly into the site of infection. And we do it by cycling those antibiotics in and out on a regular basis providing fresh high concentration antibiotic, but by also withdrawing it regularly, we prevent significant systemic absorption, thereby protecting the patient's kidneys and hearing. And so what this allows us to do is take what are today firstline broad spectrum antibiotics and dramatically improve their efficacy in treating these infections. So this is our lead candidate VTX7, it's a combination of Vanka myosin and Tober myosin, formulated for irrigation and then delivered through our proprietary fenestrated spacers using a also proprietary purpose built irrigation control unit. The The entire thing is offered as a single therapy. That's all single use. And what it allows us to do is effect aid and exchange arthroplasty, both the withdrawal and reimplantation for that patient in seven days in 100% of patients, and we do it by providing them with over 150 cycles of high concentration antibiotics during that therapeutic period. We've recently completed our primary endpoint and first secondary endpoint of our first randomized controlled trial, the apex trial. This is a, a prospective randomized multicenter trial in the US comparing VTX7 to the current standard of care. And just a few highlights from that what we found was 50% lower mortality in the VTX7 arm, we got 100% of patients reimplanted versus 85% In the standard of care, and we did it on average, 108 days sooner. So our patients are back on a fully functional revision implant in seven days. And we did that also with no drug related adverse events at all. And our surgeons saved an average of 70 minutes of our time versus the standard of care. We're currently enrolling Apex two which is a confirmatory trial, the apex one that's our Pivotal, and we expect to have that fully enrolled by the end of October. So as I mentioned earlier, we are a drug. So cedar is our lead agency. They have provided multiple special designations for VTX. Seven, we're an orphan drug, we are qualified infectious disease product, the combination of those two mean that we have 12 years of regulatory exclusivity, in which no one else can get approval for the use of vancomycin and Tober myosin for the treatment of PGI, we also get a 75% end tap from the qualified infectious disease product designation. That means our hospitals get reimbursed for the product from the very beginning of of launch. And we expect to have breakthrough therapy by the end of the year. We're launching into a 45,000 patient highly concentrated market, where 50% of the patients are in 300 hospitals and 65% of them are one payer Medicare where we have an n tap. So this means that we have a very modest commercial footprint required to reach this, this high need patient population. And when we look at our sales forecast, the top 20 sites from the apex trial represent a $200 million revenue opportunity for ostial. That's based on an analysis of their claims data. So we're poised to be the standard of care within the PGI and musculoskeletal infection space, we've got strong clinical data demonstrating clear clinical and quality of life benefit. We have existing coding coverage and payment so hospitals and surgeons will build the same codes and get paid the same way they get paid today. And importantly, there is no approved therapy for PGI in the United States. So this will be the first FDA approved product in this space. And it is very well protected despite the fact that our antibiotics are today generic antibiotics with long histories. And that's because our 12 years of regulatory exclusivity, effectively turn what are generic products back into branded drugs, we also further protect them with a significant and growing portfolio of device and drug patents are first mover advantage in the space will establish us as the standard of care. And finally, combination products are a very complex and difficult regulatory pathway. And we've developed significant experience in this space than any competitor will be challenged to repeat. We have multiple near term milestones that we'll be expecting to accomplish in the next few months. So the first though the one year data from our apex study will be available by the end of the year. We also expect breakthrough by end of the year. We'll be submitting our NDA in q3 of next year. And we expect to be on the market with with VTX7 approved in 2025. So just to wrap up, this is a $7 billion platform technology with multiple therapeutic categories that it applies in. We've got a very well defined path to market at this point. We've had a phenomenal relationship with the FDA and they're highly supportive of this program. We're basically positioned to be the standard of care in a space that currently has no solution. And so as Kai mentioned, we we had actually intended originally to kick off fundraising at this meeting and for a q4 series C. We closed it two weeks ago. So we've been very fortunate with our support from the investment community j&j led our Series A&M capital, which is a joint venture between Hillhouse and Mayo Clinic led our series B. And then we just closed our $23 million Series C. So we'll be raising our final equity round the series D in late 2024. And that will fund commercialization. So if anybody's interested in discussing that, I'd be happy to talk. Thank you very much appreciate your time.


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