Di­ur­nal en­joy­ing trans­for­ma­tional year as it gen­er­ates first com­mer­cial rev­enues

Web­site: www.di­ur­nal.co.uk

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Di­ur­nal Group (DNL:AIM) has am­bi­tions to be­come a world-lead­ing spe­cialty phar­ma­ceu­ti­cal com­pany in en­docrinol­ogy. The com­pany is tar­get­ing treat­ments in cer­tain un­der­served chronic hor­monal dis­eases that, com­bined, rep­re­sent a $10bn mar­ket op­por­tu­nity.

Di­ur­nal’s near-term fo­cus is on the de­vel­op­ment of its pipe­line of prod­ucts for the treat­ment of dis­eases of cor­ti­sol de­fi­ciency in Europe and the US, focusing on the treat­ment of the rare ge­netic con­di­tion con­gen­i­tal adrenal hyper­pla­sia (CAH), a mar­ket op­por­tu­nity of ap­prox­i­mately $0.5bn, and the treat­ment of adrenal in­suf­fi­ciency (AI), a mar­ket op­por­tu­nity of ap­prox­i­mately $2.8bn. Longer-term, Di­ur­nal’s ear­lier stage pipe­line po­ten­tially ad­dresses en­docrino­log­i­cal dis­or­ders with a com­bined mar­ket size of over $6.6 bil­lion.

Ex­e­cut­ing on this strat­egy, in just over two years af­ter Di­ur­nal’s ini­tial pub­lic of­fer­ing, the Com­pany re­ceived its first reg­u­la­tory ap­proval in Fe­bru­ary 2018: Alkindi (hy­dro­cor­ti­sone gran­ules in cap­sules for open­ing) was sub­se­quently launched in Ger­many on 15 May 2018.

Di­ur­nal is one of the few UK biotech­nol­ogy com­pa­nies that have suc­cess­fully taken a prod­uct from con­cept through to com­mer­cial­i­sa­tion. Di­ur­nal ex­pects to gen­er­ate its first com­mer­cial rev­enues dur­ing 2018.

CRE­AT­ING A STRONG EURO­PEAN COM­MER­CIAL­I­SA­TION CA­PA­BIL­ITY

The en­docrine dis­or­ders Di­ur­nal is tar­get­ing are typ­i­cally man­aged by spe­cial­ist physi­cians based in ma­jor hospi­tals. Given this con­cen­trated pre­scrib­ing base, and in an ef­fort to max­imise the eco­nomic value it ex­tracts from its prod­ucts, Di­ur­nal in­tends to di­rectly com­mer­cialise in the Euro­pean mar­ket.

Di­ur­nal has es­tab­lished the com­mer­cial in­fra­struc­ture re­quired to sup­port a suc­cess­ful launch of its first prod­uct, Alkindi, and in­tends to use the same com­mer­cial or­gan­i­sa­tion and sup­ply chain for the planned fu­ture Euro­pean launch of its sec­ond drug can­di­date, cur­rently in late stage de­vel­op­ment, Chrono­cort (mod­i­fied re­lease hy­dro­cor­ti­sone), which is an­tic­i­pated to re­ceive mar­ket au­tho­ri­sa­tion in 2020. Di­ur­nal be­lieves the work done to sup­port the launch of Alkindi sub­stan­tially de­risks the planned launch of Chrono­cort.

Di­ur­nal also be­lieves that its Euro­pean com­mer­cial in­fra­struc­ture is a valu­able as­set that can en­sure it not only re­tains the full eco­nomic value of its in-house prod­ucts in ma­jor Euro­pean ter­ri­to­ries, but also makes the com­pany an at­trac­tive part­ner for com­pa­nies seek­ing to com­mer­cialise en­docrinol­ogy fo­cused prod­ucts in Europe.

In the US, Di­ur­nal’s cur­rent strat­egy is to cap­i­talise on the in­ter­est in its pro­grammes and seek a US part­ner for com­mer­cial­i­sa­tion of its late-stage pipe­line prod­ucts at an ap­pro­pri­ate time to en­sure that mar­ket ac­cess is op­ti­mised for a suc­cess­ful prod­uct launch.

BUILD­ING VALUE IN LATESTAGE COR­TI­SOL DE­FI­CIENCY PIPE­LINE

De­fi­ciency of the es­sen­tial hor­mone cor­ti­sol re­sults in fa­tigue, de­pres­sion and may cause death through adrenal cri­sis. Through Alkindi and Chrono­cort, Di­ur­nal is build­ing a life-long ‘adrenal fran­chise’. Alkindi is the first prod­uct specif­i­cally de­signed for chil­dren suf­fer­ing from AI, and the re­lated con­di­tion CAH, and aims to ad­dress the need for a prod­uct that is li­censed, ef­fec­tive, safe and

easy to ad­min­is­ter.

Chrono­cort pro­vides a drug re­lease pro­file that the com­pany be­lieves mim­ics the body’s nat­u­ral cor­ti­sol cir­ca­dian rhythm, which cur­rent ther­apy is un­able to repli­cate, and is de­signed to im­prove dis­ease con­trol for adults with CAH. Di­ur­nal is also as­sess­ing the util­ity of Chrono­cort in adults in the AI mar­ket.

For Alkindi in the US, fol­low­ing dis­cus­sion with the US Food and Drug Ad­min­is­tra­tion (FDA), the com­pany has as­sem­bled a pack­age of stud­ies along­side the ex­ist­ing Euro­pean Phase III study data that it be­lieves will sup­port a reg­u­la­tory sub­mis­sion for ap­proval in pae­di­atric AI. The com­pany does not be­lieve that fur­ther clin­i­cal stud­ies will be re­quired for US reg­is­tra­tion and in­tends to sub­mit its reg­u­la­tory pack­age for Alkindi to the FDA in 2018.

For Chrono­cort, the Com­pany ex­pects a sig­nif­i­cant value in­flec­tion point fol­low­ing the re­port of head­line data from its Euro­pean Phase III study of Chrono­cort in CAH pa­tients, which is ex­pected in Q4 2018. In the US, fol­low­ing dis­cus­sion with the FDA, Di­ur­nal has de­signed a Phase III reg­is­tra­tion pack­age for Chrono­cort and in­tends to com­mence this pro­gramme dur­ing Q3 2018. Di­ur­nal also plans to en­ter the AI mar­ket with Chrono­cort, com­menc­ing a Phase II study in US cen­tres around the end of 2018.

Di­ur­nal’s pipe­line of prod­uct can­di­dates for cor­ti­sol de­fi­ciency are pro­tected by an ex­ten­sive patent port­fo­lio, ben­e­fit­ting from sev­eral granted or pend­ing patents in key ju­ris­dic­tions, along with strong pro­tec­tion through or­phan drug des­ig­na­tions, ex­tend­ing com­mer­cial ex­clu­siv­ity un­til 2034.

MAX­IMIS­ING PIPE­LINE PO­TEN­TIAL OUT­SIDE OF CORE MAR­KETS

Out­side Di­ur­nal’s core ter­ri­to­ries in Europe and the US, the com­pany will seek to max­imise in­come from Alkindi and Chrono­cort by en­ter­ing into lo­cal dis­tri­bu­tion agree­ments with ex­pe­ri­enced part­ners, which they have al­ready done in Is­rael, Aus­tralia and New Zealand. Typ­i­cally, the Com­pany will seek to ac­cess ter­ri­to­ries where there is the po­ten­tial for a price which re­flects the in­no­va­tion for its prod­ucts and which can use the Euro­pean reg­u­la­tory dossier as the ba­sis for lo­cal reg­u­la­tory sub­mis­sions.

BUILD­ING AN EAR­LIER-STAGE PIPE­LINE

Whilst Di­ur­nal’s cur­rent pri­mary fo­cus is on bring­ing its late-stage cor­ti­sol de­fi­ciency pipe­line to the mar­ket in Europe and the US, the com­pany’s longert­erm plan is to ex­pand into en­docrine dis­ease ar­eas, such as those as­so­ci­ated with the thy­roid, go­nads and pi­tu­itary. Ear­lier-stage can­di­dates cur­rently in­clude a na­tive oral testos­terone for the treat­ment of male hy­pog­o­nadism, which is cur­rently be­ing as­sessed in a Phase I/II clin­i­cal study ex­pected to com­plete dur­ing 2018.

The com­pany also has ear­lier-stage de­vel­op­ment ac­tiv­i­ties as­sess­ing a mod­i­fied-re­lease T3 re­place­ment ther­apy for hy­pothy­roidism and an siRNA ther­apy for Cush­ing’s dis­ease, a con­di­tion char­ac­terised by an ex­cess of cor­ti­sol. In ad­di­tion, Di­ur­nal reg­u­larly as­sesses third party prod­ucts for chronic en­docrine dis­or­ders that fit within its strate­gic vi­sion.

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