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Sareum Holdings to move forward on oral Covid treatment trials


AIM-listed Sareum Holdings (AIM:SAR) has issued a bullish update to investors today on progress with its SDC-1801 COVID treatment, which continues to advance towards first clinical trial. The board also said it felt the company was in a robust position financially following several share subscriptions by high-net-worth individuals during 2021.

In addition, the company said it is highly optimistic about the future of its out-licensed asset SRA737, which is expected to enter new clinical trials in 2022 under the guidance of Sierra Oncology, the licence holder for this exciting candidate.

SDC-1801 is a selective dual tyrosine kinase 2/Janus kinase 1 inhibitor, discovered by Sareum. The company has been advancing SDC-1801 through preclinical development and preparing for clinical trials to investigate its potential for treating autoimmune diseases, such as psoriasis, lupus, inflammatory bowel diseases, rheumatoid arthritis as well as severe respiratory symptoms of Covid-19.

Sareum is prepping for clinical trials in 2022

“We are pleased to report that the final toxicology and safety studies required to file for an exploratory Clinical Trial Authorisation have been completed and we expect the finalised reports in the first quarter of 2022,” the board told investors today. “The data from these studies will be crucial to the progression of this CTA, which we remain on track to submit during mid-2022. While data analysis is still in progress, we are confident that the studies have met their objectives of identifying any organs or tissues that might be susceptible to high-dose toxicity and determining the appropriate first-in-human dose. The results received to date fully support our plan to submit this CTA for SDC-1801.”

Sareum has appointed consultants to advise on the design of these first clinical trials, which would investigate the safety of SDC-1801 in healthy volunteers during which time the company will continue to assess the initial indications for further study.

The synthesis of SDC-1801 drug substance under GMP conditions, intended for use in the planned Phase 1 clinical trial, continues to progress to plan with delivery expected during the first half of 2022.

Oral capsule formulation for Covid symptoms?

Sareum has also initiated the process to develop drug product for these trials as an oral capsule formulation rather than orally dosed solutions or suspensions as previously planned. This step will require additional time, but the company says it believes it to be a good use of resources that will add value to the programme by improving the quality of the data generated in the Phase 1 trial and remove the need to develop capsules at a later stage.

Importantly, this first clinical trial could also support the clinical development of SDC-1801 as a potential treatment for the severe respiratory symptoms of Covid-19. As a reminder, during 2021 Sareum completed a six-month project, funded in part by a UK government grant, demonstrating that SDC-1801, in infected lung cells and in vivo disease models, reduces levels of key inflammatory agents known to play a role in the serious and potentially life-threatening hyper-inflammatory response that affects some Covid-19 patients.

Sareum says it might make use of the UK government’s AGILE clinical trial platform, or other equivalent programmes, to provide additional funding and support for clinical trials with SDC-1801 for Covid-19 applications and potentially accelerate its development.

It is evident that that there is still a clear need for new therapies to treat severe respiratory inflammation arising from viral infections such as Covid-19 despite the success of vaccination programmes and the availability of the first new, mainly antiviral, therapies. With TYK2 acknowledged as a key therapeutic target for severe Covid-19 in an article published in December 2020 in the leading scientific journal, Nature, Sareum thinks that that SDC-1801 could have a role to play in this area in the future.

Licensing deal with Sierra Oncology

In August 2021, Sierra in-licensed the BET inhibitor AZD5153 (now known as SRA515) from AstraZeneca and noted how it might combine SRA515 with SRA737 as a potential pipeline expansion opportunity. Sierra Oncology has subsequently referred to its plans to initiate additional clinical studies in the first half of 2022 with pipeline agents including SRA737 in other haematologic and solid tumour indications. Specifically, reference was made to a potential role for SRA737 in combination studies with novel agents in solid tumours, including pancreatic cancer, where patients have become resistant to a class of drugs called PARP inhibitors.

The dosing of the first patient with SRA737 in any clinical trial would trigger a $2.0m payment from Sierra under the amended $290m licensing deal on SRA737 between Sierra and CRT Pioneer Fund signed in November 2020. Under the amended agreement, Sareum is eligible to receive a 27.5% share of this and any future milestone payments.

Sareum continues to believe that, based on preclinical and early clinical data, SRA737 holds great promise for the treatment of cancer, particularly in combination settings.

What about the numbers?

Looking at Sareum’s financial position, the company ended the fiscal year to 30 June 2021 with a robust cash position having raised £2.37m (before expenses) from two subscriptions by a high-net-worth individual in June 2021. A further £2.18m (before expenses) was raised in July and August 2021 with two further share subscriptions by new high-net-worth individuals plus an exercise of warrants, bringing the total raised to approximately £4.6m to fund the further development of SDC-1801 and SDC-1802. Sareum’s cash position as at 30 September 2021 was approximately £4.4m.

Sareum reported a loss after tax during the fiscal year ended 30 June 2021 of £1.5m, reflecting the increased R&D expenditure required for preclinical development, versus a loss of £0.99m in 2020.

Sareum continues to deploy its funds to advance SDC-1801 and SDC-1802 and build a robust data package and patent portfolio to support ongoing partnering activities for these differentiated assets. For both TYK2/JAK1 inhibitor programmes, the Directors will continue to review the potential higher value of a later-stage licensing deal versus the requirement for any additional funding.

Share consolidation under consideration

Sareum also said it is considering undertaking a share consolidation in the new year. The company’s board is of the opinion that the high number of shares outstanding (over 3.3 billion) and the low absolute share price negatively affects investors’ perception of Sareum and considers a share consolidation to be in the best interests of the company and its shareholders.

A consolidation would reduce the number of shares outstanding and increase the relative price, which could be more attractive to a broader range of institutional investors and other members of the investing public. A proposal regarding the terms of a share consolidation will be put to shareholders for approval at an Extraordinary General Meeting, which will be convened early in 2022.

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This article does not constitute investment advice. Make sure you do your own research or consult a professional advisor.

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