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Regeneus Safely Treats First Patient With Promising Cancer Vaccine

The first patient has been safely treated in the clinical trial of Regeneus Ltd's (ASX:RGS) personalised cancer immunotherapy RGSH4K.

The study safety oversight committee identified no safety concern, with the data covering a dosing period of 2 vaccinations, administered 3 weeks apart.

The dosing of the first patient in the trial achieves a significant milestone in the clinical development of this autologous tumour vaccine product for the treatment of solid tumours.

The study, known as the ACTIVATE study, is a single centre, open label, first-in-human, Phase 1 dose escalating study to evaluate the safety, tolerability and preliminary efficacy of RGSH4K, administered in 21 patients with advanced cancers.

RGSH4K is produced from a patient's own cancer cells and an immunostimulant that is designed to activate the immune system against the cancer cells to initiate a body-wide response.

The immune system's memory should recognise and respond to both existing and new tumours.

Regeneus has the exclusive worldwide rights to develop and commercialise the vaccine technology for human and veterinary applications.

The technology was developed at the Bill Walsh Translational Cancer Research Laboratory which is part of the Kolling Institute of Medical Research located at the Royal North Shore Hospital in St Leonards, Sydney.

Financing and development milestones

Regeneus has also treated the first patient under first-in-human trials of its allogeneic "off-the-shelf" stem cell therapy for knee osteoarthritis, Progenza.

The Safety, Tolerability and Efficacy of Progenza (STEP) trial seeks to evaluate the treatment's safety and tolerability as well as its effect on knee pain and function.

Progenza is produced from mesenchymal stem cells derived from the adipose (fat) tissue of a healthy donor who has been extensively screened.

The company's proprietary and scalable manufacturing process is capable of producing millions of therapeutic doses from one donor.

In March, Regeneus successfully completed a preclinical study at a U.S. based facility that showed no Progenza-related safety or toxicity issues, even at doses well in excess of the intended human dose.

Research for this work has recently been supported by a A$3.4 million research and development tax incentive refund from the Australian government.

Regeneus anticipates that it will be eligible to receive reimbursement for qualifying expenditure in its R&D programs during FY2016.

Other financial highlights in the lead-up to the current product trialling have included a $6.2 million capital raising last year and a reduced cost base over FY2015 averaging a quarterly cash burn of $1.7 million.

Progress in partnering and licensing discussions

More practical advances achieved by Regeneus have included partner discussions for the clinical development, global sales and marketing of Canine CryoShot - an allogeneic "off-the-shelf" stem cell therapy for canine osteoarthritis.

The company has also progressed partner discussions for manufacturing, clinical and commercial development of Progenza in Japan, where new laws passed last year are expected to promote regenerative medicine and accelerate access to new therapies.

Regeneus has a long standing R&D relationship with Macquarie University for developing new technologies to better understand how stem cells work with real disease.

An important project is focusing on ways to optimise the selection of stem cells and their therapeutic performance.

Additional R&D agreements such as those with Quirindi Veterinary Clinic and Illawarra Equine Centre enable Regeneus to conduct ethical research on animals with real disease rather than on animals that have had their diseases induced artificially.

This gives the company a significant research advantage and has enabled it to perform early stage demonstrations of the therapeutic effects of its products for a range of conditions.

These early stage studies have in turn enabled Regeneus to develop a patent portfolio that gives protection across a broad range of applications and products.

Its IP portfolio comprises 12 granted patents; 9 in Australia; 2 in NZ and 1 in the U.S.

Analysis

Safe treatment of the first patient in RGSH4K is an important milestone in the clinical development of a cancer treatment which represents an option without many of the side effects of standard chemotherapy.

Further upside for Regeneus may be realised as the company explores partnering options in conjunction with the Phase 1 study.

Commercial potential of the cancer therapy has been emphasised by industry predictions that cancer vaccines and other emerging immunotherapies would be worth US$35 billion by 2023.

Regeneus is well funded, with $3 million in cash as of the end of June, not including the recent $3.4 million R&D funding.

Additional government funding is expected to be secured at the end of the current financial year.

The R&D funding will have a direct benefit on Regeneus' product development activities, which are developing simultaneously on several fronts, including the promising Progenza studies.

Progenza has the potential to access a major market with 250 million people affected worldwide by osteoarthritis, which has no known disease modifying treatments.

Potential price catalysts for Regeneus shares in FY2016 include the securing of a global sales and marketing partner for CryoShot Canine, commercial partnerships in Japan, a safety report on the STEP trial and continued progress in RGSH4K trialling.

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