CYP 2021 - The year ahead, page-66

I couldn’t be more excited for what’s in store for Cynata in 2021 and 2022. Investing in running our own Phase 2 trials is a game-changer for the company for what I believe are the following reasons.

A lot of the people who have been invested in Cynata for many years, including myself, are probably guilty of placing too much weight on the GvHD Phase 1 results. While it is clear they were excellent, there are a number of reasons why other companies may have been reluctant to partner with Cynata for other indications, namely:

1. It is well-understood that MSC's already have a solid history of efficacy in treating GvHD.

While Cynata’s trial was the first using iPSC derived MSC’s, this doesn’t create a compelling argument for the effectiveness of their technology, as it was in a “relatively”easy indication to demonstrate efficacy.

1. Cynata’s results, while particularly strong, were in a trial of only 15 patients.

A commercial partner for future indications will take over the majority of workaround trial design, manufacturing and all the related investments, which could easily total in the 8-9 figure range, depending on the indication, before licensing costs. This is a significant investment for any company, so to rely on the results from 15 people is likely a chasm too far to close.

1. Cynata’s scalable technology for manufacturing hasn’t been tested on a commercial scale.

After the CRL delivered to Mesoblast by the FDA in September, one of the main talking points by the company and here on the forums is the scalability of the Cymerus technology. However, this hasn’t actually been trialled in a full-scale setting yet, with the 440 patient Phase 3 OA trial to give the manufacturing it’s first minor test. While the company have designed the manufacturing process with scalability as a priority (per their presentations), commercial partners will be responsible for upscaling upon acquisition of each indication’s licence, which is standard among these agreements. As this represents a large up-front cost, being able to validity of the scalability will be paramount. In a 15 person trial, it is easy to sweep any problems under the rug. In a 440 person trial with ~1000 doses, this is not as simple and you can be sure that potential partners will be watching the roll-out with a keen eye.

The company running our own Phase 2 trials will deliver a mountain of data that potential partners will be able to use to assess us more accurately. If the Cymerus technology is as effective as the pre-clinical data suggests, then it is extremely likely that we will see some more licence agreements executed